Consolidated Financial Results for the First Half of the Fiscal Year Ending March 31, 2022

Consolidated Financial Results for the First Half of the Fiscal Year Ending March 31, 2022

(Based on J-GAAP)

Listed company:	Geniee Inc.
Code No.:	6562	URL	https://en.geniee.co.jp
Representative:	(Title/post)	Representative Director, President	(Name) Tomoaki Kudo
& CEO
Contact liaison:	(Title/post)	CFO		(Name) Jun Kikukawa
Schedule date of first quarter	November 12, 2021	Schedule date to commence
report submission:		dividend payments:

Supplemental quarterly earnings summary materials created: Yes

Quarterly earnings conference held: Yes

November 12, 2021 Listed stock exchange: TSE

TEL: [phone]

―

										(amounts below one million yen rounded off)
1. Consolidated earnings for the first half of FY2021 (April 1, 2021 to September 30, 2021)
(1) Consolidated operating results (cumulative)							(% indicates YoY change)
	Net sales		Operating income		Ordinary income	EBITDA		Profit attributable to
				owners of parent
	million yen		%	million yen		%	million yen		%	million yen		%	million yen		%
1H FY2021	6,458		－	172		－	193		－	455		863.3	138		－
1H FY2010	6,430		(8.2)	(123)		－	(140)		－	47		－	(119)		－

(Note) As the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29), etc. has been adopted from the beginning of the
fiscal year ending March 31, 2022, change in net sales is not listed due to the impact of changes in accounting standards.
(Note) Comprehensive income	1H FY 2021	143 million yen	(-%)	1H FY 2020	(126) million yen	(-%)
(Note) EBITDA = Operating income + Depreciation and amortization + Amortization of goodwill
	Net income per share		Diluted net income per share
		Yen			Yen
1H FY2021		7.69			7.65
1H FY2010		(6.66)			－

(Note) Although potentially dilutive shares do exist, they are not listed under diluted net income per share because they resulted in a net loss per share.

(2) Status of consolidated finances

		Total assets				Net assets			Equity ratio
			million yen				million yen			%
1H FY2021			6,490				2,698			41.5
FY2020			5,652				2,657			47.0
(Ref.) Shareholders' equity	1Q FY2021	2,669	million yen	FY2020	2,655 million yen
2. Status of dividends
						Total annual dividends
		End of 1Q	End of 2Q		End of 3Q		Year-end		Total
		Yen		Yen			Yen		Yen		Yen
FY2020		－	0.00			－		0.00		0.00
FY2021		－	0.00
FY2021							－		－		－
(forecast)
(Note) Revisions since most recently announced dividend forecast: None

Dividend forecast amounts for FY2021 second quarter and end of fiscal year are not yet determined.

3. Consolidated earnings forecast for FY2021 (April 1, 2021 to March 31, 2022)

	Net Sales		Operating Income	Ordinary Income	EBITDA	Profit attributable to
		owners of parent
	million yen		%	million	%	million	%	million	%	million	%
		yen	yen	yen	yen
FY2021	13,425～		－	640～	227.1～	620～	315.5～	1,259～	114.3～	526～	417.1～
13,739		－	840	329.3	820	449.5	1,459	148.3	665	553.8

As the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29), etc. has been adopted from the beginning of the

fiscal year ending March 31, 2022, change in net sales is not listed due to the impact of changes in accounting standards.

*Notes

1. Movement of important subsidiaries during consolidated cumulative quarter under review (movements of designated subsidiaries incidental to change in scope of consolidation): None
2. 
   New companies: (Company name); Excluded companies: (Company name)
3. Application of special accounting treatments during the creation of quarterly consolidated financial statements: None
4. Changes in accounting principles, changes in accounting estimates, and restatements
5. 1. Change in accounting principles incidental to revisions to accounting standards, etc.: Yes
   2. Changes in accounting principles other than 1): None
   3. Changes in accounting estimates: None
   4. Restatements: None

1. Number of issued shares (common stock)
2. 1. Number of shares issued at end of fiscal year (including treasury stock)
   2. Treasury stock as of end of term
   3. Average number of shares during fiscal year (cumulative quarter)

1H FY2021	18,048,200	shares	FY2020	18,048,200	shares
1H FY2021	102,639	shares	FY2020	118	shares
1H FY2021	18,023,688	shares	1H FY2020	17,968,246	shares

*The quarterly earnings summary is not subject to quarterly review by the public certified accountant or auditing firm.

*Explanation concerning appropriate use of earnings forecasts and other special notes (Notes on forward-looking statements)

Earnings forecasts and other forward-looking statements indicated in these materials, are based on information available and certain assumptions deemed reasonable at the time. Statements in these materials do not constitute any guarantee of actual performance. Actual business results may differ substantially due to several factors. Refer to "(3) Information on consolidated earnings forecast and other forward-looking information in 1. Qualitative information concerning quarter earnings" on page 4 of the attachment for the assumptions behind earnings forecasts and notes concerning the use thereof.

(Method of obtaining notes on quarterly financial statements)

Notes on quarterly financial statements will be published to our website on November 12, 2021.

Consolidated Financial Statements
Consolidated Balance Sheets
			(Thousands of yen)
	As of March 31, 2021		As of September 30, 2021
Assets
Current assets
Cash and deposits	1,091,864		1,536,094
Trade accounts receivable	1,479,167		－
Trade accounts receivable and contractual assets	－	1,539,542
Other	188,299		199,304
Allowance for doubtful accounts	(32,194)	(35,875)
Total current assets	2,727,136		3,239,067
Non-current assets
Total property, plant and equipment	447,052		488,256
Intangible assets
Goodwill	1,025,345		1,113,795
Software	896,899		863,616
Software in progress	151,981		361,417
Total intangible assets	2,074,225		2,338,828
Investments and other assets
Investment securities	142,255		146,667
Other	310,923		328,769
Allowance for doubtful accounts	(49,550)	(50,831)
Total investments and other assets	403,627		424,605
Total non-current assets	2,924,905		3,251,689
Total assets	5,652,042		6,490,756
		(Thousands of yen)
	As of March 31, 2021	As of September 30, 2021
Liabilities
Current liabilities
Accounts payable	1,012,031		1,155,678
Short-term borrowings	426,500		274,000
Current portion of long-term borrowings	160,928		406,821
Income taxes payable	39,062		71,289
Provision for bonuses	83,701		116,132
Other	432,211		473,048
Total current liabilities	2,154,435		2,496,968
Non-current liabilities
Long-term borrowings	650,988		1,087,696
Asset retirement obligations	126,963		143,775
Other	62,325		64,060
Total non-current liabilities	840,276		1,295,531
Total liabilities	2,994,712		3,792,500
Net assets
Shareholders' equity
Common stock	1,549,591		1,549,591
Capital surplus	1,556,829		1,122,316
Retained earnings	(462,395)		109,449
Treasury stock	(144)		(101,805)
Total shareholders' equity	2,643,880		2,679,553
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	(2,581)		(796)
Foreign currency translation adjustment	13,934		17,026
Total accumulated other comprehensive income	11,353		16,229
Stock acquisition rights	2,095		2,473
Total net assets	2,657,329		2,698,256
Total liabilities and net assets	5,652,042		6,490,756

Consolidated Statements of Income
		(Thousands of yen)
	For the fiscal year	For the fiscal year
	ended September 30, 2020	ended September 30, 2021
Net sales	6,430,952	6,458,395
Cost of sales	5,388,638	4,776,484
Gross profit	1,042,313	1,681,910
Selling, general and administrative expenses	1,165,782	1,509,494
Operating income (loss)	(123,468)	172,415
Non-operating income
Interest income	278	184
Foreign exchange gains	5,264	－
Gain on investment in partnership	－	43,692
Other	494	1,357
Total non-operating income	6,037	45,234
Non-operating expenses
Interest expenses	3,558	11,010
Foreign exchange losses	－	4,864
Casualty loss	10,130	7,011
Other	9,431	1,307
Total non-operating expenses	23,121	24,194
Ordinary income (loss)	(140,552)	193,455
Extraordinary income
Gain on reversal of subscription rights to shares	189	181
Total extraordinary income	189	181
Extraordinary losses
Loss on retirement of noncurrent assets	－	0
Loss on sale of shares in an affiliated company	8,157	－
Special severance payment	4,304	－
Damage compensation	1,295	－
Total extraordinary losses	13,757	0
Profit (loss) before income taxes	(154,120)	193,637
Income taxes - current	3,853	52,659
Income taxes - deferred	(38,017)	2,371
Total income taxes	(34,164)	55,030
Net income (loss)	(119,955)	138,607
Loss attributable to non-controlling interests	(226)	－
Profit (loss) attributable to owners of parent	(119,728)	138,607

Consolidated statements of cash flows
		(Thousands of yen)
	For the fiscal year	For the fiscal year
	ended September 30, 2020	ended September 30, 2021
Cash flows from operating activities
Profit (loss) before income taxes	(154,120)	193,637
Depreciation and amortization	138,963	200,487
Amortization of goodwill	31,741	82,073
Increase (decrease) in allowance for doubtful accounts	3,130	(460)
Increase (decrease) in provision for bonuses	14,509	32,430
Interest income	(278)	(184)
Interest expense	3,558	11,010
Foreign exchange losses (gains)	(6,935)	(1,309)
Loss (gain) on investment in partnership	－	(43,692)
Loss (gain) on sales of stock of subsidiaries and affiliates	8,157	－
Decrease (increase) in trade receivables	(102,658)	(50,579)
Increase (decrease) in notes and accounts payable - trade	129,379	145,376
Other, net	8,204	27,504
Subtotal	73,653	596,295
Interest and dividends received	278	34,722
Interest paid	(3,505)	(11,010)
Income taxes paid	(3,776)	(20,432)
Net cash provided by (used in) operating activities	66,650	599,574
Cash flows from investing activities
Purchase of property, plant and equipment	(29)	(45,535)
Purchase of intangible assets	(254,673)	(315,481)
Distributions from an investment partnership	－	10,251
Purchase of investment in subsidiaries resulting in change in scope of	－	(167,929)
consolidation
Payments for sales of investment in subsidiaries resulting in change in	(838)	－
scope of consolidation
Proceeds from long-term loans receivable	5,296	－
Payments for lease deposit and guarantee deposit	(2,576)	(19,499)
Other, net	224	－
Net cash provided by (used in) investing activities	(252,596)	(538,195)
Cash flows from financing activities
Proceeds from short-term borrowings	150,000	579,000
Repayments of short-term borrowings	(25,000)	(731,500)
Proceeds from long-term borrowings	－	800,000
Repayments of long-term borrowings	(49,998)	(117,399)
Repayments of lease obligations	(38,532)	(45,792)
Proceeds from issuance of common stock	2,100	－
Purchase of treasury shares	－	(101,631)
Purchase of investment in subsidiaries resulting in non-change in scope of	(5,223)	－
consolidation
Net cash provided by (used in) financing activities	33,345	382,677
Effect of exchange rate change on cash and cash equivalents	(4,855)	2,785
Net increase (decrease) in cash and cash equivalents	(157,456)	446,842
Cash and cash equivalents at beginning of period	1,197,540	1,091,864
Decrease in cash and cash equivalents resulting from exclusion of subsidiaries	－	(2,611)
from consolidation
Cash and cash equivalents at end of period	1,040,084	1,536,094