Visional : Consolidated Financial Results for the Nine Months Ended April 30, 2022

Disclaimer: This document is an English translation of the original Japanese language document and has been prepared solely for reference purposes. In the event of any discrepancy between this English translation and the original Japanese language document, the original Japanese language document shall prevail in all respects.

Consolidated Financial Results

for the Nine Months Ended April 30, 2022

[Japanese GAAP]

June 13, 2022

Company name: Visional, Inc.

Stock exchange listing: Tokyo Stock Exchange

Code number: 4194

URL: https://www.visional.inc/

Representative: Soichiro Minami, Representative Director and CEO

Contact: Risako Suefuji, Executive Officer, CFO and CAO

Phone: [phone]

Scheduled date of filing quarterly securities report: June 14, 2022

Scheduled date of commencing dividend payments: -

Availability of supplementary explanatory materials on quarterly financial results: Available

Schedule of quarterly financial results briefing session: Not scheduled

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Nine Months Ended April 30, 2022 (August 1, 2021 - April 30, 2022)

(1) Consolidated Operating Results				(% indicates changes from the previous corresponding period.)
				Net sales			Operating profit		Ordinary profit		Profit attributable to
								owners of parent
Nine months ended		Million yen	%		Million yen	%		Million yen	%		Million yen	%
April 30, 2022	31,884	54.8			7,218	131.9		7,515	156.2		4,880	158.9
April 30, 2021	20,601	-			3,112	-		2,933	-		1,885	-
(Note)	Comprehensive income: Nine months ended April 30, 2022: ¥4,881 million [158.9%]
				Nine months ended April 30, 2021: ¥1,885 million [ - %]
			Basic earnings			Diluted earnings
				per share			per share
Nine months ended				Yen				Yen
April 30, 2022				136.08				116.90
April 30, 2021				59.41				48.39
(Note)	The year-on-year rates of changes for the nine months ended April 30, 2021 are not disclosed, as the Company
	did not prepare consolidated financial statements for the nine months ended April 30, 2020.
(2) Consolidated Financial Position
				Total assets		Net assets	Equity ratio
					Million yen			Million yen		%
As of April 30, 2022				42,598		27,602		64.7
As of July 31, 2021				35,076		22,536		64.2

(Reference) Equity: As of April 30, 2022: ¥27,554 million As of July 31, 2021: ¥22,533 million

2. Dividends

					Annual Dividend
		1Q	2Q		3Q	Year-end	Annual
		Yen	Yen		Yen	Yen	Yen
Fiscal year ended		―	0.00		―	0.00	0.00
July 31, 2021
Fiscal year ending		―	0.00		―
July 31, 2022
Fiscal year ending
July 31, 2022						0.00	0.00
(Forecast)

(Note) Revision to the forecast for dividends announced most recently: None

3. Consolidated Financial Results Forecast for the Fiscal Year Ending July 31, 2022 (August 1, 2021 - July 31, 2022)

(% indicates changes from the previous corresponding period.)

							Profit attributable	Basic earnings
	Net sales		Operating profit	Ordinary profit	to owners of	per share
							parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Full-year	43,600	51.9	8,000	237.8	8,320	265.8	5,400	280.1	150.55

(Note) Revision to the financial results forecast announced most recently: Yes

* Notes:

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes in scope of consolidation): None
2. Accounting methods adopted particularly for the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, changes in accounting estimates and retrospective restatement
4. 1. Changes in accounting policies due to the revision of accounting standards: Yes
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting estimates: None
   4. Retrospective restatement: None

(Note) For details, please refer to "2. Quarterly Consolidated Financial Statements and Principal Notes, (3) Notes to

	Quarterly Consolidated Financial Statements (Changes in accounting policies)" on page 9 of the Attachments.
(4) Total number of issued shares (common shares)
1)	Total number of issued shares at the end of the period (including treasury shares):
	April 30, 2022:	35,879,800 shares
	July 31, 2021:	35,858,000 shares
2)	Total number of treasury shares at the end of the period:
	April 30, 2022:	179 shares
	July 31, 2021:	- shares
3)	Average number of shares during the period:
	Nine months ended April 30, 2022:	35,868,979 shares
	Nine months ended April 30, 2021:	31,732,518 shares

(Notes) On December 6, 2020, as a result of exercising the put options of Class A preferred stock, the Company redeemed all the Class A preferred stock as treasury stock and issued common stock to the shareholders in return. On the same day, all shares of the treasury stock redeemed were then canceled in accordance with Article 178 of the Companies Act, following the resolution reached at the Board of Directors' meeting held on November 20, 2020. In addition, on December 7, 2020, the Company conducted a 100-for-1 stock split, following the resolution reached at the Board of Directors' meeting held on November 20, 2020.. Accordingly, "Total number of issued shares at the end of the period" and "Average number of shares during the period" were calculated assuming that the stock split was conducted at the beginning of the fiscal year ended July 31, 2021.

• These quarterly consolidated financial results are outside the scope of quarterly review by certified public accountants or an audit firm.
• Explanation of the proper use of financial results forecast and other notes

The statements regarding the forecast of financial results in this report are based on the information that is available to the Company, as well as certain assumptions that are deemed to be reasonable by management. Therefore, there might be cases in which actual results differ materially from forecast values due to various factors.

Table of Contents - Attachments
1. Qualitative Information on Quarterly Financial Results...................................................................................	2
(1)	Explanation of Operating Results.................................................................................................................	2
(2)	Explanation of Financial Position ................................................................................................................	3
(3)	Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information.............	3
2. Quarterly Consolidated Financial Statements and Principal Notes ..................................................................	5
(1)	Quarterly Consolidated Balance Sheets .......................................................................................................	5
(2)	Quarterly Consolidated Statement of Income and Comprehensive Income ...............................................	7
(3)	Notes to Quarterly Consolidated Financial Statements ................................................................................	9
	(Notes on going concern assumption).....................................................................................................	9
	(Notes in case of significant changes in shareholders' equity) ...............................................................	9
	(Changes in accounting policies) ............................................................................................................	9
	(Segment information, etc.) ..................................................................................................................	11
	(Business combinations) .......................................................................................................................	12

1

1. Qualitative Information on Quarterly Financial Results

1. Explanation of Operating Results
   Statements in this document about the future reflect our judgments as of the end of the current quarter of the fiscal year under review.
   In the nine months ended April 30, 2022, the Japanese economy was on a recovery trend as vaccination and drugs against COVID-19 were widely available. On the other hand, the outlook for the global macroeconomy is currently uncertain and due to factors such as a surge of raw material prices and fluctuation in the financial capital markets, the outlook for economic activities that have shown signs of recovery have again become unclear.
   Under these circumstances, the Group's core BizReach business performed steadily, backed by a continued great willingness of companies to recruit and the increase in job seekers due to advertising.
   As a result, in the nine months ended April 30, 2022, the Group recorded net sales of ¥31,884 million (up 54.8% year on year), operating profit of ¥7,218 million (up 131.9% year on year), ordinary profit of ¥7,515 million (up 156.2% year on year), and profit attributable to owners of parent of ¥4,880 million (up 158.9% year on year).
   Performance by segment was as follows.

1. HR Tech

The HR Tech segment consists of BizReach, HRMOS, and other HR Tech services.

In the BizReach business, backed by continued recovery of human resources demand in the professional hiring domain, as of the end of the third quarter under review, the cumulative number of registered direct employers (Note 1) increased to more than 20,000 (compared to more than 17,100 as of the end of the previous fiscal year), the number of active headhunters (Note 2) increased to more than 5,200 (compared to more than 5,100 as of the end of the previous fiscal year), and the number of scoutable job seekers (Note 3) increased to more than 1.59 million (compared to more than 1.38 million as of the end of the previous fiscal year), all of which, as an indicator, have shown growth from the end of the previous fiscal year. As a result, the BizReach business recorded net sales of ¥27,390 million (up 63.9% year on year) and adjusted operating profit before corporate expense allocation (Note 4) of ¥14,006 million (up 87.4% year on year).

In the HRMOS business, we are conducting marketing activities in order to expand the number of customers while continuing product investment such as the development of new functionality. During the third quarter under review, new functions such as "Individual Condition Survey" by which companies identify changes in conditions of their employees have been released.

ARR (Note 5) of the HRMOS business rose 27.7% to ¥1,537 million, the number of unique paying

customers (Note 6) increased 25.6% to 1,127, and ARPU (Note 7) rose 1.6% to ¥113,651 from the end of the previous fiscal year. The churn rate (Note 8), which is a 12-month average, decreased to 0.66%.

As a result, the HRMOS business recorded net sales of ¥1,057 million (up 24.8% year on year) and an adjusted operating loss before corporate expense allocation (Note 4) of ¥2,047 million (loss of ¥1,151 million for the previous fiscal year). As a result, in the nine months ended April 30, 2022, the HR Tech segment recorded net sales of ¥30,320 million (up 56.0% year on year) and segment profit of ¥8,929 million (up 112.3% year on year).

(Notes) 1. The total number of employers that have subscribed to BizReach, excluding headhunters

1. The number of headhunters that have been screened by BizReach, Inc.
2. The number of registered BizReach users who have configured their employment history to be disclosed to hiring companies or who have configured their employment history to be disclosed to headhunters
3. This is the operating profit or loss of the business before bearing the personnel expenses and

2