Meiko Network Japan : Summary of Financial Results for the third quarter 2022

Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

(Japanese GAAP)

July 8, 2022

Company name:

MEIKO NETWORK JAPAN CO., LTD.

Listing:

Tokyo

Securities code:

4668

（URL：https://www.meikonet.co.jp）

Representative:

Kazuhito Yamashita, President & Representative Director

Inquiries:

Kouyuki Sakamoto, Executive Officer, General Manager of Corporate Planning Department

Telephone:

[phone]

Scheduled date to file quarterly securities report:

July11, 2022

Scheduled date to commencement dividend payment:

-

Preparation of supplementary material on quarterly financial results: None

Holding of quarterly financial results briefing:

None

(Amounts are rounded down to the nearest million yen.)

1. Consolidated financial results for the Nine months ended May 31, 2022 (from September 1, 2021 to May 31, 2022)

(1) Consolidated operating results (cumulative)

(% indicates changes from the previous corresponding period.)

Net sales

Operating profit

Ordinary profit

Profit attributable to

owners of parent

Nine months ended

Millions of yen

%

Millions of yen

%

Millions of yen

%

Millions of yen

%

May 31, 2022

2.8

721

12.1

13,884

647

140.0

94.8

753

May 31, 2021

13,505

1.0

269

620.2

370

103.6

672

－

(Note) Comprehensive income: Nine months ended May 31, 2022: ¥888 million [32.6 %] Nine months ended May 31, 2021: ¥670 million [114.2 %]

	Basic earnings per	Diluted earnings
	share	per share
Nine months ended	Yen	Yen
May 31, 2022
30.04	－
May 31, 2021
26.81	－

(2) Consolidated financial position

	Total assets	Net assets	Equity-to-asset ratio
As of	Millions of yen	Millions of yen	%
May 31, 2022	14,591	10,369	71.1
August 31, 2021	14,649	10,025	68.4

(Reference) Equity: As of May 31, 2022:	¥10,369 million
As of August 31, 2021:	¥10,025 million

2. Cash Dividends

	Annual dividends per share
First quarter-end	Second quarter-end	Third quarter-end	Fiscal year-end	Total
Yen	Yen	Yen	Yen	Yen

Fiscal year ended August 31,		－		10.00	－	10.00	20.00
2021
Fiscal year ending August 31,		－		11.00	－
2022
Fiscal year ending August 31,					－	11.00	22.00
2022 (Forecast)
(Note) Revision of dividend forecast		in the current quarter:		None

3. Consolidated Financial Results Forecast for Fiscal Year Ending August 31, 2022 (from September 1, 2021 to August 31, 2022)

(% indicates year-on-year changes)

	Net sales		Operating profit		Ordinary profit	Profit attributable to	Basic earnings
			owners of parent	per share
	Millions of yen	％	Millions of yen	％	Millions of yen	％	Millions of yen	％	yen
Full-year						1,114
19,800	4.0	1,040	7.3		0.0	1,025	(10.1)	40.86
(Note) Revision to the financial results forecast announced most recently:	None

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Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

*Notes:

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in the scope of consolidation): None

(2) Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: None

1. Changes in accounting policies, changes in accounting estimates, and restatement
2. 1. Changes in accounting policies caused by revision of accounting standards: Yes

2)	Changes in accounting policies due to other reasons:	None
3)	Changes in accounting estimates:	None
4)	Restatement:	None

1. Number of issued shares (common shares)

1. Total number of issued shares at the end of the period (including treasuryshares)

As of May 31, 2022	27,803,600 shares
As of August 31, 2021	27,803,600 shares

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

As of May 31, 2022	2,720,058 shares
As of August 31, 2021	2,720,058 shares

1. Average number of shares outstanding during the period (cumulative from the beginning of the fiscal year)

Nine months ended May 31, 2022	25,083,542 shares
Nine months ended May 31, 2021	25,084,546 shares

• Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit corporation.
• Proper use of earnings forecasts, and other special matters

Forward-looking statements in the document, such as earnings forecasts, are based on the information currently available and certain assumptions that the company thinks reasonable. Actual results may differ remarkably from the statements due to variety of different factors.

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Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

（Reference）Trend of numbers of Meiko Gijuku schools and registered students and system-wide sales

	Term		Nine months ended May	Nine months ended May
		31, 2021	31, 2022
			From Sep. 1, 2020	From Sep. 1, 2021
	Fiscal Period		to May 31, 2021	to May 31, 2022
		Operating	YOY	Operating	YOY
			results	comparison	results	comparison
Number of Meiko Gijuku directly operated schools (MNJ)	206	(37)	217	11
Number of Meiko Gijuku directly operated schools (MAXIS)	93	(1)	95	2
Number of Meiko Gijuku directly operated schools (KLINE)	41	(1)	41	-
Number of Meiko Gijuku directly operated schools (TOMONI)*1	42	-	42	-
Number of Meiko Gijuku directly operated schools (One link)	20	20	21	1
Number of Meiko Gijuku directly operated schools (Cooth) *2	-	-	15	15
Subtotal number of Meiko Gijuku directly operated schools	402	(19)	431	29
Number of Meiko Gijuku franchised schools		1,370	(80)	1,336	(34)
Total number of Meiko Gijuku schools		1,772	(99)	1,767	(5)
Number of registered students of Meiko Gijuku directly	13,109	588	13,765	656
operated schools (MNJ)
Number of registered students of Meiko Gijuku directly	6,060	654	5,797	(263)
operated schools	(MAXIS)
Number of registered students of Meiko Gijuku directly	2,561	344	2,591	30
operated schools	(KLINE)
Number of registered students of Meiko Gijuku directly	1,900	189	1,955	55
operated schools	(TOMONI)*1
Number of registered students of Meiko Gijuku directly	759	759	811	52
operated schools	(One link)
umber of registered students of Meiko Gijuku directly		-	-	955	955
operated schools	(Cooth) *2
Subtotal mumber of registered students of Meiko Gijuku directly	24,389	2,534	25,874	1,485
operated schools
Number of registered students of Meiko Gijuku franchised	64,744	409	60,655	(4,089)
Schools
Total number of registered students of Meiko Gijuku schools	89,133	2,943	86,529	(2,604)
Sales from Meiko Gijuku directly operated schools	(Millions of yen)	8,041	829	8,486	445
Sales from Meiko Gijuku franchised schools *3	(Millions of yen)	3,162	(101)	3,230	67
Sales from Japanese language schools	(Millions of yen)	665	(304)	552	(113)
Sales from others		(Millions of yen)	1,635	(282)	1,615	(20)
Total Sales		(Millions of yen)	13,505	139	13,884	378
Sales from Meiko Gijuku directly operated schools	(Millions of yen)	8,041	829	8,486	445
System-wide sales from Meiko Gijuku franchised schools	18,509	(893)	17,373	(1,135)
		(Millions of yen)
Total system-wide sales from Meiko Gijuku schools *4	26,550	(63)	25,860	(690)
		(Millions of yen )

• 1 K.M.G Corporation Co., Ltd has changed its name to TOMONI Co., Ltd. as of September 1, 2021.
  2 Cooth CO., LTD. was included in the scope of consolidation on December 1, 2021 due to the acquisition of shares.
  3 Sales from Meiko Gijuku franchised schools represent royalty revenues and sales of products.
  4 Total system-wide sales from Meiko Gijuku schools represent the sum of total sales of Meiko Gijuku directly operated schools, including tuition, materials fees, and examination fees, and the total sales of Meiko Gijuku franchised schools, including tuition. Materials fees and examination fees of franchised schools are excluded.

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Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

Quarterly Consolidated Financial Statements and Major Notes

(1) Quarterly consolidated statement of Balance Sheets

				(Millions of yen)
	As of August 31, 2021	As of May 31, 2022
Assets
Current assets
Cash and deposits	8,727	8,339
Accounts receivable - trade			767		－
Accounts receivable - trade, and contract assets			－		618
Securities			200		－
Merchandise			114		95
Work in process			13		3
Supplies			7		17
Advance payments to suppliers			19		9
Prepaid expenses			303		297
Other			322		231
Allowance for doubtful accounts			33)		31)
Total current assets	10,441	9,580
		(		(
Non-current assets
Property, plant and equipment
Buildings and structures	1,145	1,341
Accumulated depreciation		(	676)	(	770)
Buildings and structures, net		469	570
Tools, furniture and fixtures		(	375	(	390
Accumulated depreciation		322)	337)
Tools, furniture and fixtures, net		52	53
Land			0		49
Leased assets			10		35
Accumulated depreciation			(1)		22)
Leased assets, net			8		( 12
Total property, plant and equipment			531		685
Intangible assets
Goodwill			203		455
Software			190		188
Software in progress			4		3
Telephone subscription right			4		4
Total intangible assets			402		651
Investments and other assets
Investment securities	2,022	2,362
Long-term prepaid expenses			42		39
Deferred tax assets			226		180
Leasehold and guarantee deposits			942		944
Long-term time deposits			－		100
Other			40		45
Total investments and other assets		3,274	3,672
Total non-current assets		4,207	5,010
Total assets		14,649	14,591

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Summary of Consolidated Financial Results for the Nine Months Ended May 31, 2022

				(Millions of yen)
	As of August 31, 2021	As of May 31, 2022
Liabilities
Current liabilities
Accounts payable - trade	119	117
Accounts payable - other	102	140
Accrued expenses	1,139	835
Income taxes payable	427	299
Accrued consumption taxes	331	145
Advances received	1,242	－
Contract liabilities			－	1,157
Lease obligations	1	1
Deposits received	54	122
Provision for bonuses	404	523
Other		51	58
Total current liabilities	3,876	3,401
Non-current liabilities
Long-term borrowings			－	56
Retirement benefit liability	111	121
Provision for share awards for directors (and other officers)	11	21
Provision for share awards	34	34
Long-term accounts payable-other to employees	104	84
Long-term accounts payable-other to officers	117	117
Deferred tax liabilities	18	10
Lease obligations	7	11
Asset retirement obligations	339	360
Long-term guarantee deposits		1	1
Total non-current liabilities		747	820
Total liabilities	4,624	4,221
Net assets
Shareholders' equity
Share capital	972	972
Capital surplus	909	909
Retained earnings	10,529	10,738
Treasury shares	2,779)	2,779)
Total shareholders' equity			( 9,632	( 9,841
Accumulated other comprehensive income
Valuation difference on available-for-sale securities	377	509
Foreign currency translation adjustment		15	17
Total accumulated other comprehensive income		392	527
Total net assets	10,025	10,369
Total liabilities and net assets			14,649	14,591

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