Members : Financial Results Briefing for 1Q FY2023

Financial Results for 1Q FY2023

Members Co., Ltd. (TSE 2130)

July 29, 2022

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 (Tokyo), Web Garden Sendai, Web Garden Kitakyushu, Web Garden Kobe, Sapporo Office
Capital	1,002 million yen (as of June 30, 2022)
Sales revenue	14,938 million yen (fiscal year ended March 31, 2022)〔IFRS〕
Securities code	2130; Prime Section of Tokyo Stock Exchange
No. of employees	2,303 (as of June 30, 2022)
(consolidated)

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Management Policy and Service Features

Members is a platform on which digital creators (DCs), who play a

leading role in value creation in the rapidly expanding digital

economy, can grow and play an active role.

We develop and provide optimal digital business operation services that meet social needs in order to realize a prosperous society.

	Marketing
	transformation
	Promoting CSV (*)
	management and corporate
	value marketing
	Support to
	create social
An initiative to achieve	problem-solving
business
10,000 digital creators
Supporting the
A group of creators who embody the core
development of digital
values of "contribution, challenge,
products and services
sincerity, and teamwork" and continue to
improve their skills to maximize the
results of client companies.

companies

Dedicated team for digital business

(EMC: Engagement Marketing Center)

Major

operation support

DC human resources

Technology-specific DC

Tech

human resources provision

provision

comprehensive

Data

UX Design

DX

venture

service

Scientists

Digital business support for mid-sized local companies

companies

Engineering

SaaS

DevOps

technology

Digital business / Product development support

Advanced

domain

business PGTEMC Team) Growth Product (PGT: business

Pursuing happiness of digital creators

Creating social value

Optimizing the services provided

* CSV (Creating Shared Value: A management method that simultaneously realizes economic and social value)

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1Q FY 2023 Overview

As enterprises proceeded with digitalization, our performance was healthy. Our service of supporting business in high value-added fields, including data and UX, performed well continuously. Added-value sales kept growing by 25%. 484 new graduates joined our company, increasing the loss, but it is in line with our plan.

Consolidated results

Sales revenue

3,831 million +23.3%

yen y/y

Business situation

Operating loss		Added-value sales
67	yen		3,677	yen	+25.6%
yen y/y
	million	-76 million		million
					y/y

EMC business Sales revenue 2,486 million +16.8%

yen y/y

PGT business Sales revenue 1,559 million +37.7%

yen y/y

No. of companies	53	-1 from the
we offer the EMC	end of the
model	previous FY
No. of companies	43	+22 from the
we offer the PGT	end of the
model	previous FY

Operation rate	Up 4.3 points
during 23/1Q	y/y

86.0 ％

Ratio of sales of
Up 7.4 points	No. of digital
services other than	-24 from the end
website operation	compared to	creators in	876 of the previous FY
22/4Q	EMC business
during 23/1Q
	PGT business	733 of the previous FY
36.0	％
			No. of digital	+10 from the end
			creators in

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Income Statement Summary

Gross profit grew 31.4% year on year, and gross profit margin rose 1.9 points year on year, as the increase in average sales price exceeded the increase in remuneration for DCs. As the assignment of tasks to new graduates was postponed and we made more active investment in mid-career recruitment and sales marketing, SGA increased year on year. The profits in the first half and the full year are expected to rise, and we aim to achieve the forecast profits.

		Result in 1Q		First half year in FY3/2023	Full year in FY3/2023
	FY3/2022	FY3/2023	y/y	Forecast	Progress rate	Forecast	Progress rate
[Unit：million yen]	toward the	toward the
					forecast		forecast
Sales revenue	3,108	3,831	+23.3%	8,280	46.3%	18,200	21.1%
Added value sales	2,927	3,677	+25.6%	―	―	―	―
Gross profit	892	1,173	+31.4%	―	―	―	―
(Gross profit margin)	28.7%	30.6%	―	―	―	―	―
SGA	890	1,239	+39.2%	―	―	―	―
Operating profit	9	(67)	―	450	―	2,200	―
(Operating profit	0.3%	(1.8%)	―	―	―	―	―
margin)
Pretax profit	7	(93)	―	445	―	2,185	―
Net profit	17	(67)	―	320	―	1,573	―

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

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