Members : Financial Results Briefing for 1Q FY2022

Financial Results for 1Q FY2022

Members Co., Ltd. (TSE 2130)

July 30, 2021

Proprietary and Confidential to Members Co.,LTD

Company Profile

Representative Director and President Tadashi Kenmochi

Members is the internet business partner that aims to create a spiritually rich society through "MEMBERSHIP" by

supporting digital business with digital creators.

Corporate name	Members Co., Ltd.
Date of establishment	June 26, 1995
Mission	Create a spiritually rich society through "MEMBERSHIP"
(VISION2030)
Locations	Headquarters: 37th floor of Harumi Island Triton Square Office Tower X, 1-8-10 Harumi, Chuo-ku, Tokyo
	Web Garden Sendai: 8th floor of Daiichi Seimei Tower Bldg., 4-6-1Ichiban-cho,Aoba-ku,Sendai-shi, Miyagi
	Web Garden Kitakyushu: 9th floor of Meiji Yasuda Seimei Kokura Bldg., 9-1Konya-machi,Kokurakita-ku,Kitakyushu-shi, Fukuoka
	Web Garden Kobe: 16th floor of Kobe Commerce Industry and Trade Center Bldg., 5-1-14 Hamabedori, Chuo-ku,Kobe-shi, Hyogo
	Sapporo Office: 5th floor of 11.CONCEPT SPERARE Bldg., 1-1-65Minami-Jujo-Nishi,Chuo-ku,Sapporo-shi, Hokkaido
Capital	935 million yen (as of June 30, 2021)
Sales revenue	12,087 million yen (fiscal year ended March 31, 2021)〔IFRS〕
Securities code	2130; First Section of Tokyo Stock Exchange
No. of employees	1,824 (as of June 30, 2021)
(consolidated)

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Proprietary and Confidential to Members Co.,LTD

Service Features

EMC business

(Engagement Marketing Center business)

Outline

Digital business operation support service Websites, EC, SNS, apps, marketing automation (MA), digital transformation (DX), etc.

Features

• Dedicated teams of digital creators for the client companies, which deeply understand the management strategies, goals, products, and services of the clients, drive the digital business.
• Methodization of the operation know-how by the dedicated teams
  ①Improvement in outcomes ②Enhancement of productivity ③Quality and security
  ④Promotion of CSV marketing ⑤Team building ⑥ Account plan ⑦Shift of cutting-edge technology fields
• Specializing in large client companies, large-scale transactions, and continuous projects

Major clients

Shiseido Co., Ltd., SKY Perfect JSAT Corporation, Daikyo Inc., Trend Micro Inc., Panasonic Corporation,

Benesse Corporation, Mizuho Bank, Ltd., Sumitomo

Mitsui Card Co., Ltd., etc.

PGT business(*)

(Product Growth Team business)

Outline

Provision of personnel for supporting the growth of digital products of clients

DX producers, UX designers, data scientists, marketing planners, data engineers, website directors, website designers, engineers, and others

Features

• Provision of autonomous teams of digital creators
• To support growth in the cutting-edge technology fields
  To support the growth of digital products of clients by using the skills in the cutting-edgetechnology field with high added value
• Creators first
  System of appointing creators as executive officers, remote work, and development of a sound working environment

Major clients

• Internet-relatedenterprises with great growth potential
• Social innovation ventures for solving social issues
• Local medium-sized enterprises

* In April 2021, "Digital Personnel business" was renamed "Product Growth Team (PGT) business."

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Proprietary and Confidential to Members Co.,LTD

1Q FY 2022 Overview

Thanks to the active digital shift and DX in enterprises, sales revenue increased 24.9% year on year. Operating profit turned positive in 1Q for the first time in 6 terms, due to the

profitability enhancement through the improvement in utilization rate in the PGT business.

Consolidated results

Sales revenue		Operating profit		Added-value sales
	million	+24.9%	million		+67			million	+28.6%
		million yen
3,108 yen	y/y	9 yen		y/y	2,927 yen		y/y
Business situation
EMC business			PGT business				No. of companies	44	-3 from the
					we offer the EMC	end of the
Sales revenue			Sales revenue				model		previous term
	million	+15.1%		million	+42.4%				EMC		end of the
2,129			1,132				creators			950	＋175 from the
	y/y		y/y			PGT	end of the
	yen			yen						697	+168 from the
								business	previous term

Educational investment

million

73 yen

Down 11 million

yen y/y

Ratio of sales of

services other than

website operation

25.1 ％

Up 4.7 points

y/y

Estimated term-end dividend per share

23.5 yen

Up 6.0 yen from

the previous

term

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Income Statement Summary

The y/y growth rate of sales revenue was as high as 24.9%. New graduates were assigned to on-site duties earlier than usual, but gross profit margin was almost unchanged year on year. From 2Q, we will accelerate the assignment of new graduates to on-site duties to improve profitability.

				Progress		Progress
	Results for 1Q	Results for 1Q	Forecast for	rate toward	Full-year	rate toward
	1H of FY	the forecast	forecast for	the full-year
	of FY 3/2021	y/y
	of FY 3/2022	3/2022	for 1H of FY	FY 3/2022	forecast for
[unit: million yen]				3/2022		FY 3/2022

Sales revenue	2,489	3,108	+24.9%	7,000	44.4%	15,200	20.5%
Added value	2,277	2,927	+28.6%	―	―		―
sales

Gross profit	721	892	+23.8%	―	―		―
（Gross profit	29.0%	28.7%	―	―	―		―
margin）
SGA	801	890	+11.2%	―	―		―
Operating profit	(58)	9	+67	504	1.8%	1,800	0.5%
（Operating profit	―	0.3%	―	―	―		―
margin）
Pretax profit	(59)	7	+67	490	1.5%	1,790	0.4%
Net profit	(11)	17	+29	328	5.5%	1,199	1.5%

* Added value sales = Sales revenue ー Outsourcing and procurement costs ＝ Sales from in-house resources

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