Hamee : Fiscal Year Ending April 30, 2022 Financial Results

Consolidated Financial Results

FY04/22 [Japanese GAAP]

June 13, 2022

Name of listed company Hamee Corp.

Listed stock exchanges

East

Code Number

3134

URL https://hamee.co.jp/

Representative (Title) President and CEO

(Name) Ikuhiro Mizushima

Contact person (Title) Officer,Corporate Planning Dept.Manager

(Name) Ippei Takahashi

(TEL)[phone]

Scheduled date of Annual General MeetingJuly 28, 2022

Date of dividends payment July 29, 2022

Date to file Securities Report

July 29, 2022

Supplementary materials for financial Result: Yes

Results briefing

: Yes

( Scheduled to be held for institutional

investors and analysts on June 14,2022)

FY04/2022 consolidated results (May 1, 2021-April 30, 2022)

(Millions of yen are rounded down)

(1)Consolidated operating results

(Percentages indicate year-on-year change.)

Net sales

Operating income

Ordinary income

Attributable to owners of

parent Net income

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

FY04/22

13,413

8.5

2,202

1.0

2,329

8.4

1,743

12.0

FY04/21

12,363

9.2

2,179

24.9

2,148

22.3

1,556

45.5

(NOTE) Comprehensive incomeFY04/22

1,865Millions of yen

(5.3%) FY04/21

1,771Millions of yen

(90.7%)

Earnings Per share

Diluted

Shareholders' equity

Total assets

Operating income

Earning Per Share

Net income margin

Profit ratio

Yen

Yen

%

%

%

FY04/22

109.72

109.43

23.9

24.7

16.4

FY04/21

98.38

97.62

28.0

26.1

17.6

(Reference) Equity in earnings of affiliatesFY04/22

5Millions of yen

FY04/21

0Millions of yen

(2)Consolidated Financial Position

Total assets

Net assets

Equity Ratio

Net assets per share

Millions of yen

Millions of yen

%

Yen

FY04/22

10,518

8,252

77.6

513.06

FY04/21

8,338

6,528

77.1

404.97

(Reference) Shareholders' equity

FY04/22

8,157Millions of yen

FY04/21

6,429Millions of yen

(3)Consolidated Cash Flows

Cash Flows from

Cash Flows from

Cash Flows from

Cash and cash equivalents

operating activities

investing activities

financing activities

Balance at end of year

Millions of yen

Millions of yen

Millions of yen

Millions of yen

FY04/22

1,186

△886

298

4,025

FY04/21

1,941

△412

△1,736

3,354

2.Dividends

Annual dividend per share

Total

Dividend

Net assets

End of first

End of

End of the

dividends

payout ratio

Dividend rate

second

Year end

Total

(Total)

(Consolidated)

(Consolidated)

quarter

quarter

third quarter

Yen

Yen

Yen

Yen

Yen

Millions of yen

%

%

FY04/21

-

0.00

-

10.00

10.00

158

10.2

2.9

FY04/22

-

0.00

-

22.50

22.50

357

20.5

4.9

FY04/23 (Forecast)

-

0.00

-

22.50

22.50

22.7

Forecast of consolidated results for FY04/23 (May 1, 2022 to April 30, 2023)

(Percentages indicate year-on-year changes.)

	Net sales		Operating		Ordinary income	Attributable to owners	Earning Per
				income				of parent Net income	Share
	Millions of yen		%	Millions of yen		%	Millions of yen	%	Millions of yen	%	Yen
Full year	15,932		18.8	2,293		4.1	2,295	△1.5	1,575	△9.6	99.10

(NOTE) As we manage our business performance on an annual basis, our business performance forecasts are only for the full fiscal year.

• Notes

(1)Significant Changes in Subsidiaries during the Fiscal Year (Changes in specified subsidiaries affecting the scope of consolidation) :None

New	-Company	、	Removed -Company

(2)Changes in accounting policies and changes or restatement of accounting estimates

① Changes in accounting policies caused by revision of accounting standards	:	Yes
② Changes in accounting policies other than ①	:	None
③ Changes in accounting estimates	:	None
④ Restatement	:	None
(3)Number of shares outstanding(common stock)

① Number of shares outstanding at the end of the period(including treasury stock)

• Number of treasury stock at the end of the period

• Average number of shares during the period

FY04/22	16,268,800Shares	FY04/21	16,255,200Shares
FY04/22	369,516Shares	FY04/21	377,523Shares
FY04/22	15,893,560Shares	FY04/21	15,819,780Shares

(Reference) Summary of Non-consolidated Financial Results

Non-consolidated Performance for the Fiscal Year Ended FY04/22 (May 1, 2021-April 30, 2022)

(1) Explanation of Non-Consolidated Results of Operation (Percentages indicate year-on-yearchanges.)

	Net sales		Operating income		Ordinary income	Net income
	Millions of yen		%	Millions of yen	%		Millions of yen	%	Millions of yen		%
FY04/22	11,451		5.6	1,488	12.7		1,667	32.2	1,208		41.5
FY04/21	10,840		5.6	1,320	3.5		1,261	△0.6	854		13.6
	Earnings Per Share	Diluted Earning Per Share
			Yen				Yen
FY04/22			76.04			75.85
FY04/21			53.99			53.57

(2)Non-Consolidated Financial Position

	Total assets	Net assets	Equity Ratio	Net assets per share
	Millions of yen	Millions of yen	%	Yen
FY04/22		7,459	5,416	71.3	334.69
FY04/21		5,731	4,350	74.2	267.81
(Reference) Shareholders' equity	FY04/22	5,321Millions of yen	FY04/21 4,252Millions of yen

• This financial summary is not subject to the audit by a certified public accountant or auditing firm.
• Disclaimer regarding to Forward Looking Statements

(Precautions on forward-looking statements)

The earnings forecasts and other forward-looking statements presented in these materials reflect information available to the company and assumptions as of the date of this announcement that are based on uncertain factors that may affect future results, and the Company does not guarantee the achievement of these targets. Actual results may differ significantly as a consequence of numerous factors. Please refer to "1. Overview of Operating Results, (4) Future Outlook" on page 5 of the attachments for the assumptions used in the forecasts and cautionary statements regarding the use of the forecasts.

(Video for financial briefing)

We plan to distribute a video on our financial results on our website (https://hamee.co.jp/ir/library/video).

○Accompanying Materials - Contents
1.Overview of Operating Results....................................................................................................	2
(1)Overview of Operating Results for the Fiscal Year under Review..................................................	2
(2)Overview of Financial Position for the Fiscal Year under Review...................................................	5
(3)Overview of Cash Flows for the Fiscal Year under Review............................................................	5
(4)Future Outlook.....................................................................................................................	7
2. Basic Approach to the Selection of Accounting Standards..............................................................	11
3.Consolidated Financial Statements and Major Notes.....................................................................	12
(1)Consolidated Balance Sheets................................................................................................	12
(2)Consolidated Statement of Income and Consolidated Statement of Comprehensive Income...........	14
(3)Consolidated Statements of Changes in Net Assets..................................................................	16
(4)Consolidated Statements of Cash Flows................................................................................	20
(5)Notes fo consolidated financial statements.............................................................................	22
(Notes on the Going Concern Assumption)...............................................................................	22
(Basis of Presenting Consolidated Financial Statements)...........................................................	22
(Changes in Accounting Policies)............................................................................................	23
(Segment information, etc.)..................................................................................................	24
(Per Share Information).......................................................................................................	27
(Significant Subsequent Events).............................................................................................	28

1

1.Overview of Operating Results.

(1)Overview of Operating Results for the Fiscal Year under Review

During the fiscal year under review, in Japan, restrictions on actions due to COVID-19 continued, and while there was no significant recovery in consumption at physical stores, there was no significant reactionary decline against the expansion of the EC market, which showed a significant rise in the previous fiscal year, the first year of COVID-19. Turning to the global economy, we felt the headwinds throughout the year, including the sharp depreciation of the yen, the disruption in the supply chain triggered by the global shortage of semiconductors, the sharp rise in marine freight rates caused by the shortage of containers and the shortage of labor due to lock-downs, and the soaring price of crude oil and other resources.

In this environment, the status of each segment was as follows.

• Commerce Business a. Domestic business

In the first quarter of the consolidated fiscal year under review, although there was no backlash like the increase in demand seen in the previous fiscal year due to the launch of iPhone SE2 and other factors, in the new iPhone shopping season in September, the release of new products, particularly iFace series, progressed steadily, and sales and marketing measures that accurately grasped market trends were successful. As a result, we remained at a level above that of the previous fiscal year, and it was again confident that iFace's brand power was high. In retailing, we won the Rakuten Shop of the Year 2021 Smartphone, Tablet, and Peripheral Equipment Genre Award for the third consecutive year. In wholesaling, we launched full-scale transactions with new carriers, and we were able to achieve results that will lead to future growth in each of our sales channels. In the fourth quarter of the fiscal year under review, retail sales fell short of the previous fiscal year due to the headwinds of an extension of the period of restrictions on behavior during COVID-19 to the new lifestyle shopping season. On the other hand, in April, real consumption recovered and wholesale sales recovered its momentum. This was a period in which we were able to demonstrate stable profitability in our business of maintaining a strong brand of iFace by maintaining a balanced distribution channel of wholesale, retail, and two sales channels. This year, iFace celebrated its 10th anniversary since its launch. Going forward, we will continue to firmly grow this brand as a mainstay brand.

In addition, the gaming monitor business, which started in the fiscal year under review, continued to be unable to meet demand in the first half of the fiscal year under review due to a supply shortage caused by a worldwide shortage of semiconductors and other factors. However, supply recovered from the second half of the fiscal year, and average monthly sales rose to more than JPY50 million. In the Cosmetics Business launched in the third quarter of the fiscal year under review, we will continue to make upfront investments for the time being because of aggressive marketing and branding measures. However, we are expanding our sales channels utilizing wholesale and other sales channels in the Commerce Business, and we will firmly link this to the next fiscal year.

b. Overseas Business

In the U.S., the largest market, various e-commerce sales measures were successful by strengthening the organizational capabilities related to e-commerce sales, which had been undertaken in the past, and contributed to boosting sales, particularly in Otamatone. In addition, our organizational strength grew enough to enable us to roll out localized products in the U.S. market. As a result, sales were robust, particularly for squeezes, which were featured in character rollouts. In line with this development, we were able to accelerate the development of tech accessories, particularly in iFace.

As a result, net sales in the Commerce Business were JPY10,189,693 thousand (up 4.8% year on year) and operating income was JPY2,186,985 thousand (down 12.5%).

2

• Platform Business a. Next Engine

For the internally developed cloud computing (SaaS) EC Attractions Next Engine, although the pace of customer acquisition stabilized compared to the previous fiscal year, when there was special demand for e-commerce because of COVID-19, we continued to strengthen customer success activities. In September, we reached 5,000 clients, and the number of clients remained at a high level compared to the level prior to COVID-19. We are investing in infrastructure to improve the efficiency of server operations and ensure stable operation. Although this investment has a slight impact on the profit margin, the increase in revenues from the acquisition of more clients contributed to solid growth in operating income.

b. Hamee Consulting Corp. (hereafter, Hamee Consulting)

In Hamee consulting, which provides sales support consulting for e-commerce businesses, we were able to continuously win EC consulting contracts with major customers, and our sales base grew significantly. In addition, we added new store production and renovation and other production projects that were newly launched as business divisions in the second half of the fiscal year as focus areas, resulting in significant increases in sales and profits.

As a result, net sales in the Platform Business were JPY2,769,297 thousand (up 20.0% year on year) and operating income was JPY1,144,063 thousand (up 19.8%).

• Others

This is related to new services that cannot be clearly categorized into either the Commerce Business or the Platform Business, and includes the Hometo Tax Payment Support Service, Hamic POCKET mobile device for elementary school students, and RUKAMO ethical net shop.

The Hometown Tax Payment Business recorded significant increases in both sales and profits, supported by the expansion of the hometown tax payment market, in addition to sales activities that have been undertaken since the beginning of the fiscal year, centered on the development of new businesses for returns and return home items, the use and enhancement of Next Engine, and strengthened efforts on the front side, such as the conversion and renovation of local government portal sites and advertising production.

With regard to Hamic POCKET, in order to resolve the battery issues in Hamic Pocket that had been on the market since the beginning of the fiscal year, in February 2022 we began sales of a Hamic Pocket L with a larger battery capacity. However, the difficulty of developing and manufacturing smartphones by ourselves is high, and we continue to be unable to produce products that meet user expectations. We will continue to develop these products within the scope of our annual investment ceilings.

In the fiscal year under review, net sales were JPY454,490 thousand(up 37.9% year on year), and segment income (operating loss) was JPY231,659 thousand (compared with an operating loss of JPY273,208 thousand in the previous fiscal year) due to the upfront investment phase other than the "Hometown Tax Payment Support Service."

As a result, net sales for the fiscal year under review were JPY13,413,481 thousand (up 8.5% year on year), operating income was JPY2,202,385 thousand (up 1.0%), ordinary income was JPY2,329,611 thousand (up 8.4%), and attributable to owners of parent net income was JPY1,743,821 thousand (up 12.0%).

As a result of comprehensively considering consolidated sales of JPY13.8 billion or more and consolidated operating profit margin of 16% or more, which are targets for the current consolidated fiscal year under the medium-term management plan (from the fiscal year ending April 2020 to the fiscal year ending April 2022), we believe that we have achieved this target, and the year-end dividend payout ratio is 20% or more, subject to a resolution of the shareholders meeting.

3