Financial Statement Information

Condensed consolidated balance sheet

(Unit: million yen)

Year ended October 2018

Year ended October 2019

ASSETS

Current assets

Cash and deposits

2,482

2,564

Notes and accounts receivable-trade

1,123

851

Merchandise

12

3

Work in process

28

13

Short-term loans receivable

76

10

Accounts receivable-other

39

88

Virtual currencies

274

137

Deposits paid

820

312

Others

126

282

Allowance for doubtful accounts

-78

Total current assets

4,905

4,265

Non-current assets

Property, plant and equipment

Buildings and structures

274

82

Accumulated depreciation

-60

-24

Buildings and structures, net

214

57

Machinery, equipment and vehicles

9

12

Accumulated depreciation

-8

-5

Machinery, equipment and vehicles, net

0

6

Tools, furniture and fixtures

281

253

Accumulated depreciation

-119

-197

Tools, furniture and fixtures, net

161

56

Land

146

0

Lease assets

11

11

Accumulated depreciation

-11

-11

Lease assets, net

0

0

Construction in progress

2

Total property, plant and equipment

525

121

Intangible assets

Software

86

60

Goodwill

135

1,419

Others

30

221

Total intangible assets

252

1,701

Investments and other assets

Investment securities

4,983

4,178

Investments in capital

154

13

Long-term loans receivable

141

214

Others

220

238

Allowance for doubtful accounts

-160

-236

Total investments and other assets

5,338

4,406

Total non-current assets

6,117

6,229

Total assets

11,022

10,494

Year ended October 2018

Year ended October 2019

LIABILITIES

Current liabilities

Notes and accounts payable-trade

252

265

Short-term loans payable

2,000

Current portion of long-term loans payable

145

502

Current portion of bonds

140

Accounts payable-other

194

215

Income taxes payable

5

32

Provision for bonuses

234

166

Others

582

545

Total current liabilities

3,415

1,867

Non-current liabilities

Bonds payable

490

Long-term loans payable

236

2,076

Deferred tax liabilities

55

2

Others

48

13

Total non-current liabilities

341

2,583

Reserves under special laws

Reserve for financial instruments transaction liabilities

0

0

Total reserves under special laws

0

0

Total liabilities

3,756

4,450

NET ASSETS

Shareholders’ equity

Capital stock

1,000

1,000

Capital surplus

7,663

7,663

Retained losses

-1,496

-3,247

Treasury shares

-88

-88

Total shareholders’ equity

7,078

5,326

Accumulated other comprehensive income

Valuation difference on other available-for-sale securities

88

6

Deferred gains or losses on hedges

-0

-0

Foreign currency translation adjustment

100

100

Total accumulated other comprehensive income

188

105

Share acquisition rights

2

Non-controlling interests

609

Total net assets

7,266

6,044

Total liabilities and net assets

11,022

10,494

Condensed consolidated profit and loss statement

(Unit: million yen)

Year ended October 2018

Year ended October 2019

Net sales

7,640

7,600

Cost of sales

6,618

6,248

Gross profit

1,021

1,351

Selling, general and administrative expenses

1,417

1,967

Operating income or Operating loss

-395

-615

Non-operating income

Interest income

10

8

Dividend income

0

Gain on sales of investment securities

100

Share of profit of entities accounted for using equity method

26

Gain on sales of virtual currencies

915

House rent income

12

Others

34

21

Total non-operating income

1,087

43

Non-operating expenses

Interest expenses

15

25

Commission expenses

56

99

Share of loss of entities accounted for using equity method

391

Others

7

23

Total non-operating expenses

78

539

Ordinary income

612

-1,111

Extraordinary income

Gain on sales of non-current assets

2

Gain on sales of investment securities

126

Gain on sales of shares of subsidiaries and associates

10

Reversal of allowance for doubtful accounts

6

2

Gain on change in equity

40

1

Virtual currencies revaluation gain

102

Gain on exchange of virtual currencies

60

Total extraordinary income

335

16

Extraordinary losses

Loss on valuation of investment securities

68

144

Impairment loss

291

487

Loss on retirement of non-current assets

0

0

Loss on step acquisitions

5

Total extraordinary losses

360

637

Profit (loss) before income taxes

588

-1,733

Income taxes-current

27

16

Income taxes-deferred

5

3

Total income taxes

33

19

Profit (loss)

555

-1,752

Profit attributable to non-controlling interests

4

0

Profit (loss) attributable to owners of parent

550

-1,753

Statement of changes in shareholders’ equity

(Unit: million yen)

Shareholders’ equity

Capital stock

Capital surplus

Retained losses

Treasury shares

Total shareholders’ equity

Balance at the biginning of the fiscal year

1,000

7,663

-1,496

-88

7,078

Cumulative effects of changes in accounting policies

Restated balance

Changes of items during period

Issuance of new shares

Issuance of new shares — exercise of acquisition rights

Increase by share exchanges

Profit attributable to owners of parent

-1,753

-1,753

Change in ownership interest of parent due to transactions with non-controlling interests

Transfer by capital reduction

Change of scope of equity method

1

1

Deficit disposition

Net changes of items other than shareholders’ equity

Total changes of items during period

-1,751

-1,751

Balance at the end of the fiscal year

1,000

7,663

-3,247

-88

5,326

Accumulated other comprehensive income

Share acquisition rights

Noncontrolling interests

Total net assets

Valuation difference on other securities

Deferred gains/losses on hedging instruments

Foreign exchange adjustment account

Total other accumulated comprehensive income

Balance at the beginning of the fiscal year

88

100

188

7,266

Cumulative effects of changes in accounting policies

Restated balance

Changes of items during period

Issuance of new shares

Issuance of new shares – exercise of share acquisition rights

Increase by share exchanges

Profit attributable to owners of parent

-1,753

Change in ownership interest of parent due to transactions with non-controlling interests

Transfer by capital reduction

Change of scope of equity method

1

Deficit disposition

Net changes of items other than shareholders’ equity

-81

-0

-0

-82

2

609

529

Total changes of items during period

-81

-0

-0

-82

2

609

-1,222

Balance at end of current period

6

-0

100

105

2

609

6,044

Condensed consolidated cash flow statement

Year ended October 2018

Year ended October 2019

Cash flow from operating activities

373

-232

Cash flow from investment activities

-4,168

-1,203

Cash flow from financial activities

4,206

1,173

Exchange rate difference in relation to cash and cash equivalents

0

-2

Increase (or decrease: -) in cash and cash equivalents

411

-264

Opening balance of cash and cash equivalents

2,071

2,482

Increase in cash and cash equivalents from newly consolidated subsidiary

345

Closing balance of cash and cash equivalents

2,482

2,564