I mobile : FY2022 Q3 Consolidated Financial Results

Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.

June 8, 2022

Consolidated Financial Results for the Nine Months

of the Fiscal Year Ending July 31, 2022

(Under Japanese GAAP)

Company name:	i-mobile Co., Ltd.
Listing:	Tokyo Stock Exchange
Securities code:	6535
URL:	https://www.i-mobile.co.jp/
Representative:	Tetsuya Noguchi, Representative Director, CEO
Inquiries:	Yasuhiro Fumita, Director
Telephone:	[phone]

Scheduled date to file quarterly securities report:	June 9, 2022
Scheduled date to commence dividend payments:	-
Preparation of supplementary material on quarterly financial results:	Yes
Holding of quarterly financial results briefing:	None

(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated financial results for the nine months of the fiscal year ending July 31, 2022 (from August 1, 2021 to April 30, 2022)

1. Consolidated operating results (cumulative)

(Percentages indicate year-on-year changes.)

	Net sales		Operating profit		Ordinary profit		Profit attributable to
				owners of parent
Nine months ended	Millions of yen		%	Millions of yen		%	Millions of yen		%	Millions of yen		%
April 30, 2022	11,984		25.0	3,683		22.8	3,790		25.6	2,625		30.2
April 30, 2021	9,590		55.9	2,998		49.9	3,017		51.9	2,016		32.6

Note: Comprehensive income	For the nine months ended April 30, 2022:	2,629 million yen [30.4%]
		For the nine months ended April 30, 2021:	2,016 million yen [35.0%]
	Basic earnings per share	Diluted earnings per share
	Nine months ended	Yen	Yen
	April 30, 2022	121.81	121.42
	April 30, 2021	94.08	93.04

Note: The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. from the beginning of the first quarter of the current fiscal year. Figures for the first nine months of the fiscal year ended July 31, 2021 are the figures after retrospective application of the accounting standard, etc.

(2) Consolidated financial position

		Total assets	Net assets	Equity-to-asset ratio
	As of	Millions of yen	Millions of yen	%
	April 30, 2022	20,395	15,294	74.7
	July 31, 2021	18,992	14,720	77.4
Reference: Equity
	As of April 30, 2022:	15,239 million yen
	As of July 31, 2021:	14,704 million yen

2. Cash dividends

			Annual dividends per share
		First quarter-end	Second quarter-end		Third quarter-end	Fiscal year-end	Total
		Yen	Yen		Yen	Yen	Yen
	Fiscal year ended	-	0.00		-	100.00	100.00
	July 31, 2021
	Fiscal year ending	-	0.00		-
	July 31, 2022
	Fiscal year ending					35.00	35.00
	July 31, 2022 (Forecast)
Note: Revisions to the forecast of cash dividends most recently announced: None

3. Consolidated earnings forecast for the fiscal year ending July 31, 2022 (fromAugust 1, 2021 to July 31, 2022)

(Percentages indicate year-on-year changes.)

	Net sales		Operating profit		Ordinary profit		Profit attributable to	Basic earnings
				owners of parent		per share
	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
July 31, 2022	14,270	23.1	3,750	10.9	3,715	10.4	2,504	8.9	116.49

Note: Revisions to the earnings forecasts most recently announced: None

The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc. from the beginning of the first quarter of the current fiscal year. Year on year changes show comparisons with the figures after retrospective application of the accounting standard, etc.

* Notes

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes in scope of consolidation): None

Newly included:	0 companies
Excluded:	0 companies

1. Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: None
2. Changes in accounting policies, changes in accounting estimates, and restatement
3. 1. Changes in accounting policies due to revisions to accounting standards and other regulations: Yes
   2. Changes in accounting policies other than (i) : None
   3. Changes in accounting estimates: None
   4. Restatement: None
4. Number of shares issued (common shares)
5. 1. Number of issued shares at the end of period (including treasury shares)

As of April 30, 2022	21,848,196 shares
As of July 31, 2021	21,848,196 shares

1. Number of treasury shares at the end of period

As of April 30, 2022	255,850 shares
As of July 31, 2021	345,050 shares

(iii) Number of shares outstanding during the period (cumulative from the beginning of the fiscal year)

Nine months ended April 30, 2022	21,557,017 shares
Nine months ended April 30, 2021	21,432,504 shares

• Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit firm.
• Proper use of earnings forecasts, and other special matters

The forward-looking statements, including business results forecasts, contained in this document are based on information currently available to the Company and certain assumptions deemed reasonable by the Company. Actual business results may differ considerably due to a variety of factors. See 1. Qualitative Information on Quarterly Financial Results, (3) Explanation of Forward-looking Information, Including Consolidated Earnings Forecasts on page 4 of the Quarterly Financial Results (Appendix).

(Change in unit for presentation of amounts)

The amounts for accounts and other items on the Company's quarterly consolidated financial statements were previously stated in thousands of yen. However, since the first quarter of the current fiscal year, the amounts have been stated in millions of yen.

For ease of comparison, the units of the amounts for the previous fiscal year and the first nine months of the previous fiscal year have also been changed to millions of yen.

Appendix

Index

1. Qualitative Information on Quarterly Financial Results ………………………….……………………………	2
(1)	Explanation of Operating Results …………………………………………………………………………	2
(2)	Explanation of Financial Position …………………………………………………………………………	4
(3)	Explanation of Forward-looking Information, Including Consolidated Earnings Forecasts ………………	4
2. Quarterly Consolidated Financial Statements and Notes ………………………………………………………	5
(1)	Quarterly Consolidated Balance Sheet ……………………………………………………………………	5
(2)	Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive Income ……	6
(3)	Notes to the Quarterly Consolidated Financial Statements …………………………………………………	8
	Notes on Going Concern Assumption ……………………………………………………………………	8
	Notes on Significant Changes in Shareholders' Equity ……………………………………………………	8
	Changes in Accounting Policies ……………………………………………………………………………	8
	Segment Information and Other Data ...…………………………………………………………….………	9
	Significant Subsequent Events ……………………………………………………………………………	10

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1. Qualitative Information on Quarterly Financial Results

(1) Explanation of Operating Results

During the nine months ended April 30, 2022, the Japanese economy showed signs of gradual recovery from the prolonged impact of COVID-19, but the outlook for the domestic and overseas economy remained uncertain due to the re-spread of infectious diseases caused by the outbreak of mutant strains and the uncertainty over the situation in Russia and Ukraine.

The i-mobile Group (the "Group") had no significant impact on its business performance due to the spread of COVID-19 and the situation in Russia and Ukraine. However, if the economic impact becomes more prolonged and serious in the future, the Group's business performance could be adversely affected by such factors as a contraction in the advertising market due to a decrease in the number of advertisers, a shrinkage in the hometown tax donation market because of a decline in individual residence tax and income tax, and further restrictions on business activities.

The Group is composed of two business segments - Online Advertising and Consumer Service - operating under the corporate vision "Creating a Business for the Future". In the market for the Hometown Tax Donation business, which is the mainstay of the Consumer Service segment, the hometown tax donation amount in fiscal 2020 increased by approximately 1.4 times year on year to 672.5 billion yen while the number of hometown tax donations also increased by approximately 1.5 times to 34.89 million*1. In addition, the number of people eligible for the hometown tax donation credit (the number of people who actually made a hometown tax donation and were eligible for a residence tax credit) also increased year on year by approximately 1.3 times*1 to 5.524 million people, as it becomes more widely accepted as a stable system in line with its initial purpose of realizing regional revitalization*2.

Moreover, in the domestic online advertising market, which is a core business domain in the Online Advertising segment, online advertising expenditure in 2021 increased by 21.4% year on year to 2,705.2 billion yen, growth remained steady with the acceleration in the digitization of society serving as a tailwind. In particular, online advertising media expenditures grew 22.8% year on year to 2,157.1 billion yen, reflecting a rebound from the previous year, when consumption was sluggish due to the impact of COVID-19 and advertising placements declined. Due to an increase in time spent at home and the Tokyo 2020 Olympic and Paralympic Games, the number of users of video streaming services has grown resulting in a marked increase in demand for video ads*3. Overall online advertising media expenditures in 2022 is forecasted to reach 115.0% of the previous year's level, or 2,481.1 billion yen*4 , and further market growth is expected.

As an Internet marketing company in this business climate, the Group has worked to further enhance corporate value, leveraging the technology and marketing expertise from multiple angles cultivated in the core Online Advertising (Ad Network) business by developing new markets, and investing in growth business sectors. With Furunavi, the Hometown Tax Donation business which has functions for solving social issues, such as the local- communitie revitalization, we improved recognition of the Furunavi brand and ran promotion activities to increase the number of local governments we do business with, and Furunavi-related services strengthened original plans for experience-based gifts in return such as dining and lodging gift certificates, working with local governments on. In the Online Advertising segment, we promoted the growth of the Media Solution and App Operation businesses, which are both the focus areas. We also made Simple App Studio Inc., which plans and operates HealthTech apps, a subsidiary in October 2021, and are working to expand our media-related business. Moreover, in the Ad Network business, we are striving to improve the earnings structure and ensure stable profits.

Furthermore, with the aim of meeting the expectations of society by engaging in management with sustainability from a medium- to long-term perspective, the Group has formulated its Basic Policy on Sustainability and is further enhancing its efforts to resolve social issues, including environmental and climate change issues. The Hometown Tax Donation Regional Revitalization Collaboration Lab led by the Company utilized the Hometown Tax Donation system to send approximately 32 tons of rice to a total of 6,400 single-parent households in Tokyo that were exhausted by the COVID-19 pandemic.

As a result of these efforts, for the first nine months of the current fiscal year, the Group recorded net sales of 11,984 million yen, up 25.0% year on year, operating profit of 3,683 million yen, up 22.8% year on year, ordinary profit of 3,790 million yen, up 25.6% year on year, profit attributable to owners of parent of 2,625 million yen, up

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