ASIRO : Consolidated Financial Results for the First Six Months of the Fiscal Year Ending October 31, 2022 (Under IFRS)

Note: This document has been translated from a part of 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.

Consolidated Financial Results

for the First Six Months of the Fiscal Year Ending October 31, 2022

(Under IFRS)

		June 14, 2022
Company name:	ASIRO Inc.	Listing: Tokyo Stock Exchange
Securities code:	7378	URL: https://asiro.co.jp/
Representative:	Hiroto Nakayama, Representative Director and President
Contact:	Satoshi Kawamura, Director and CFO
Tel:	[phone]
Planned date of quarterly report submission:	June 14, 2022
Planned start date for payment of dividends:	-
Preparation of supplemental explanatory material for quarterly results:	Yes
Holding of briefing for quarterly results:	Yes

(Amounts are rounded to the nearest million yen)

1. Consolidated Financial Results of the First Six months of the Fiscal Year Ending October 31, 2022 (November 1, 2021 to April 30, 2022)

1. Consolidated Operating Results

(Percentage figures represent year-on-year changes)

	Revenue	Operating profit	Profit before tax	Profit		Profit attributable	Total
		to owners of	comprehensive
												parent		income
	Millions of	%	Millions of	%	Millions of	%	Millions of		%	Millions of		%	Millions of	%
	yen			yen			yen		yen			yen			yen
Six months ended	1,021	38.8		303	55.1	300	57.4	206		68.3	206		68.3	225	102.9
April 30, 2022
Six months ended	736	(2.8)		195	31.6	191	32.9	122		39.9	122		39.9	111	26.0
April 30, 2021
	Basic earnings per	Diluted earnings per
	share			share
			Yen			Yen
Six months ended		30.47			27.22
April 30, 2022
Six months ended		20.38			20.38
April 30, 2021
(Reference) EBITDA:
Six months ended April 30, 2022			331 million yen (up 50.0%)
Six months ended April 30, 2021			221 million yen (up 22.3%)
Adjusted EBITDA:
Six months ended April 30, 2022			317 million yen (up 49.6%)
Six months ended April 30, 2021			212 million yen (up 24.4%)

(Note) EBITDA and adjusted EBITDA are disclosed as useful comparative information on the Company's performance.

Please see "1. Qualitative Information on Operating Result (3) Explanation of Cash Flows (Reference Information)" on page 4 of the attached materials for information on the definitions and calculation methods of each indicator.

(Note) The Company's shares were unlisted in the first six months of the fiscal year ended October 31, 2021, and although share acquisition rights existed, their dilutive effect is not included in the calculation of diluted earnings per share for the first six months of the fiscal year ended October 31, 2021 because vesting is conditional upon listing.

1. Consolidated Financial Position

Equity attributable to

Ratio of equity

Total assets

Total equity

attributable to owners of

owners of parent

parent

Millions of yen

Millions of yen

Millions of yen

%

As of April 30, 2022

3,333

2,353

2,349

70.5

As of October 31, 2021

2,802

2,222

2,222

79.3

2.

Dividend Status

Annual dividends per share

1Q-end

2Q-end

3Q-end

4Q-end

Total

yen

yen

yen

yen

yen

Fiscal year ended October 31, 2021

―

0.00

―

0.00

0.00

Fiscal year ending October 31, 2022

―

0.00

Fiscal year ending October 31, 2022

―

0.00

0.00

(forecast)

Note: Revisions to most recently announced dividend forecast: No

3. Consolidated Earnings Forecasts of the Fiscal Year Ending October 31, 2022 (November 1, 2021 to October 31, 2022) (Percentage figures represent year-on-yearchanges)

		Revenue		Operating profit	Profit before tax	Profit		Profit attributable to	Basic earnings per
				owners of parent	share
		Millions of		%	Millions of	%	Millions of	%	Millions of	%	Millions of	%	Yen
		yen		yen	yen	yen	yen
	Full year	1,861		19.8	406	12.4	403	13.8	276	20.6	276	20.6	40.39
Note: Revisions to most recently announced earnings forecasts: No

• Notes

1. Changes in significant subsidiaries during the period
   (Changes in specified subsidiaries resulting in changes in scope of consolidation): Yes

Newly added:	1 company (Company name) Kailash Small Amount and Short Term Insurance
Excluded:	1 company (Company name) trient, Inc.

The Company performed an absorption-type merger of trient, Inc. on December 1, 2021. Furthermore, the Company acquired additional shares in Kailash Small Amount and Short Term Insurance on April 28, 2022, making it a consolidated subsidiary.

1. Changes in accounting policies and changes in accounting estimates

(i)	Changes in accounting policies required by IFRS:	None
(ii)	Changes in accounting policies due to other reasons:	Yes
(iii)	Changes in accounting estimates:	None

Note: See "2. Condensed Quarterly Consolidated Financial Statements and Notes (5) Notes to Condensed Quarterly Consolidated Financial Statements (Changes in Accounting Policies) on page 11 for details.

1. Number of shares issued (common stock)

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

As of April 30, 2022	6,841,768 shares
As of October 31, 2021	6,829,000 shares

1. Number of treasury stock at the end of the period

As of April 30, 2022	133,400 shares
As of October 31, 2021	- shares

1. Average number of shares during the period

Six months ended April 30, 2022	6,751,308 shares
Six months ended April 30, 2021	6,000,000 shares

• This report is exempt from the quarterly review by certified public accountants or auditing firms.
• Explanation on appropriate use of results forecasts and other notes

The results forecasts and other forward-looking statements shown in these materials are based on information obtained by the Company at present, and certain assumptions deemed to be reasonable. They are not intended to be a promise by the Company to achieve the results. Furthermore, actual results, etc. may vary significantly due to a variety of factors.

Due to factors such as the timing of the impact of COVID-19 subsiding remaining unclear, the Company promptly disclose any revisions to earnings forecasts that are required based on future business trends.

Appendix
Table of Contents
1. Qualitative Information on Operating Result.................................................................................................	2
(1)	Explanation of Operating Results...........................................................................................................	2
(2)	Explanation of Financial Position...........................................................................................................	3
(3)	Explanation of Cash Flows.....................................................................................................................	3
(4)	Explanation of Forward-looking Information such as Consolidated Earnings Forecasts.......................	4
2. Condensed Quarterly Consolidated Financial Statements and Notes ............................................................	5
(1)	Condensed Quarterly Consolidated Statement of Financial Position .....................................................	5
(2)	Condensed Quarterly Consolidated Statements of Income and Comprehensive Income.......................	7
(3)	Condensed Quarterly Consolidated Statement of Changes in Equity ....................................................	9
(4)	Condensed Quarterly Consolidated Statements of Cash Flows............................................................	10
(5)	Notes to Condensed Quarterly Consolidated Financial Statements .....................................................	11
	(Notes on Going Concern Assumptions) ...............................................................................................	11
	(Changes in Accounting Policies)..........................................................................................................	11
	(Changes in Accounting Estimates).......................................................................................................	11
	(Bonds) ..................................................................................................................................................	11
	(Segment Information)...........................................................................................................................	12
	(Per Share Information) .........................................................................................................................	13
	(Business Combinations) .......................................................................................................................	14
	(Significant Events after Reporting Period)...........................................................................................	17

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1. Qualitative Information on Operating Result

1. Explanation of Operating Results

During the six months ended April 30, 2022, the Japanese economy proceeded to return to normal due to the spread of vaccinations against the novel coronavirus (COVID-19), but concerns still cannot be dispelled in the current conditions. In addition, there is growing uncertainty about the future due to factors such as the global rise in resource prices and the invasion of Ukraine by Russia.

Meanwhile, in the Internet advertising market surrounding the Group, advertising expenditures continued to grow consistently to 2.7052 trillion yen (up 21.4% year on year), and exceeded advertising expenditures in the four forms of mass media (aggregate of advertising expenses in the newspapers, magazines, radio and television) for the first time. (Source: Dentsu Inc. "2021 Advertising Expenditures in Japan")

In such business conditions, the Group is conducting business centered on Legal Media & Other, and operates Legal Media primarily with attorneys as customers and Other Media for customers other than attorneys. Furthermore, in addition to Legal Media & Other, the Group operates Legal Human Resources to provide personnel referral services primarily for attorneys.

In Legal Media that accounts for a large portion of revenue, as a result of increasing the number of new contracts by strengthening sales activities along with customer success activities providing customer support after signing contracts, and focusing on lowering the churn rate, the number of advertising slots posted (Note 1) in April 2022 was 1,696 (up 21.0% year on year), and the number of advertising customers (Note 2) was 684 (up 26.0% year on year), with business growing steadily.

(Note 1) The number of advertising slots posted is the total number, and multiple slots are counted in cases where the same customer has multiple advertising slots.

(Note 2) The number of advertising customers is the actual number of customers with advertising slots.

Furthermore, in Other Media, there was an increase in business in the "Carism" career change media based on heightened recruiting motivation of companies aimed at normalization of the economy, and the number of inquiries during the six months ended April 30, 2022 increased significantly to 17,411 (up 79.9% year on year).

Consequently, the results for the six months ended April 30, 2022 were as follows. Revenue was 1,021,087 thousand yen (up 38.8% year on year), operating profit was 302,723 thousand yen (up 55.1% year on year), profit before tax was 300,399 thousand yen (up 57.4% year on year) and profit was 205,746 thousand yen (up 68.3% year on year). Note that Kailash Small Amount and Short Term Insurance ("Kailash"), which became a consolidated subsidiary on April 28, 2022, is only consolidated on the balance sheet as of April 30, 2022, and the statement of income will be consolidated from the third quarter.

Operating results by segment were as follows. [Legal Media & Other]

In addition to advertising revenue increasing due to increases in advertising slots posted and advertising customers in Legal Media, due to the increase in inquiries in the "Carism" career change business in Other Media as mentioned above, revenue was 966,771 thousand yen (up 38.3% year on year) and segment profit was 444,661 thousand yen (up 45.2% year on year).

Legal Media revenue was 682,698 thousand yen (up 23.6% year on year) and operating profit was 298,463 thousand yen (up 12.4% year on year). Other Media revenue was 284,073 thousand yen (up 93.6% year on year) and operating profit was 146,198 thousand yen (up 260.1% year on year).

[Legal Human Resources]

Since the launch of the business in two fiscal years ago, there was a steady increase in registrants and contracts in personnel referral services, resulting in revenue of 54,316 thousand yen (up 49.7% year on year), and segment profit of 24,665 thousand yen (up 502.7% year on year).

[Other]

Due to the occurrence of expenses for preparation of the launch of new business and the consolidation of Kailash on the statement of income from the third quarter, from the six month ended April 30, 2022,

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