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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. U-NEXT HOLDINGS Co., Ltd. (Tokyo Stock Exchange, Prime Market Code: 9418) Summary of Second Quarter of Fiscal Year Ending August 2025 April 10, 2025
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 1 Contents 1.Overview of 2Q results of operations 2. Segment information 3. Topics 4. Appendix
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 2 1. Overview of 2Q results of operations
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 3 Executive summary All-time highs on a quarterly basis in Communication & Energy. Record-high first half performance for Content Distribution and Store & Facility Solutions. Despite expecting the impact of recent macroeconomic trends on our company to be minimal, no change in the FY2025 forecast. First half and quarterly record highs for sales and earnings at all levels.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 4 (Million yen) FY2025 Forecast FY2025 ２Q Progress Net Sales 360,000 186,782 52％ Operating Income 31,000 16,608 54％ Operating Margin (%) 8.6% 8.9% - Ordinary Income 30,000 16,620 55％ Profit or Loss attributable to owners of parent 16,700 9,436 57％ Profit of Loss attributable to owners of parent［Adjusted］ 19,850 11,062 56％ EBITDA 42,500 21,946 52％ EBITDA Margin 11.8% 11.7% - EBITDA-CAPEX 10,300 2,226 22％ Consolidated financial summary (vs. Forecast) ⚫ First half sales and earnings at all levels were more than 50% of the FY2025 forecasts. ⚫ EBITDA-CAPEX down mainly due to the purchase of stock of a subsidiary (¥3.2 billion).
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 5 Consolidated financial summary (YoY) (Million yen) FY2024 ２Q FY2025 ２Ｑ YoY YoY (Ratio) Net Sales 152,249 186,782 +34,533 23％ Operating Income 15,813 16,608 +794 5％ Operating Margin (%) 10.4% 8.9% - - Ordinary Income 15,323 16,620 +1,296 8％ Profit or Loss attributable to owners of parent 8,727 9,436 +709 8％ Profit of Loss attributable to owners of parent [Adjusted] 10,299 11,062 +763 7％ EBITDA 20,665 21,946 +1,280 6％ EBITDA Margin 13.6% 11.7% - - EBITDA-CAPEX 7,850 2,226 ▲5,623 ▲72％ ⚫ Sales up 23% and high single-digit growth of earnings at all levels. ⚫ EBITDA-CAPEX down mainly due to business investments (purchase of real estate and development of a new POS register service) and the purchase of stock of a subsidiary.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 6 (Million yen) FY2025 Forecast FY2025 ２Q Progress Content Distribution Net Sales 122,100 62,455 51％ Operating Income 9,800 5,815 59％ Operating Margin 8.0% 9.3% - Store & Facility Solutions Net Sales 93,100 49,191 53％ Operating Income 14,700 9,199 63％ Operating Margin 15.8% 18.7% - Communication & Energy Net Sales 142,100 73,784 52％ Operating Income 13,600 5,445 40％ Operating Margin 9.6% 7.4% - Financial, Realty & Global Net Sales 8,700 4,936 57％ Operating Income 1,400 795 57％ Operating Margin 16.1% 16.1% - Adjustment Net Sales -6,000 -3,584 60％ Operating Income -8,500 -4,648 55％ Segment information (vs. Forecast) ⚫ Store & Facility Solutions and Financial, Realty & Global performance far exceeded the forecasts. ⚫ Communication & Energy earnings were below half of the FY2025 forecast but higher than the first half forecast. *The adjustment includes head office expenses, goodwill amortization, the elimination of inter-segment transactions and other items.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 7 (Million yen) FY2024 ２Q FY2025 ２Q YoY YoY (Ratio) Content Distribution Net Sales 53,048 62,455 +9,406 18％ Operating Income 4,420 5,815 +1,394 32％ Operating Margin 8.3％ 9.3% - - Store & Facility Solutions Net Sales 45,200 49,191 +3,990 9％ Operating Income 7,893 9,199 +1,305 17％ Operating Margin 17.5％ 18.7% - - Communication & Energy Net Sales 52,700 73,784 +21,084 40％ Operating Income 6,470 5,445 ▲1,024 ▲16％ Operating Margin 12.3％ 7.4% - - Financial, Realty & Global Net Sales 4,260 4,936 +676 16％ Operating Income 733 795 +61 8％ Operating Margin 17.2％ 16.1% - - Adjustment Net Sales -2,961 -3,584 ▲623 21％ Operating Income -3,705 -4,648 ▲943 25％ Segment information (YoY) ⚫ Higher sales and earnings in all segments except Communication & Energy. ⚫ Communication & Energy sales up but earnings down mainly because of capacity payments. The 1H earnings decline is much smaller than at the end of the 1Q. *The adjustment includes head office expenses, goodwill amortization, the elimination of inter-segment transactions and other items.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 8 Net Sales/Operating Income/EBITDA EBITDA = Operating Income ＋ Depreciation ＋ Amortization of goodwill YoY +23％ QoQ +３％ (Million yen) Operating Income / margin EBITDA / margin 3 3 2 2 2 2 3 3 2 3 2 2 2 23 2 2 3 32 2 2 22 2 23 2 2 2 2 2 3 .3 . . . 22 2 2 33 3 22 2 3 32 2 2 2 22 2 23 2 2 2 2 2 3 3 3 3 2 3 2 2 2 2 3 32 2 2 2 2 3 3 3 2 2 22 2 23 2 2 2 2 2 3 . .3 2. . E A YoY +５％ QoQ +１％ YoY +６％ QoQ +３％ Net Sales Operating margin (cumulative) EBITDA margin (cumulative) All-time quarterly and first half highs for sales, operating income and EBITDA.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 9 SG&A expenses SG&A ratio YoY ▲２pt (Quarter) QoQ ▲０pt SG&A YoY +11％ (Quarter) QoQ +０% 2 3 2 2 23 2 3 2 3 3 2 2 2 3 3 3 2 3 3 2 3 3 22 2 2 3 3 2 33 2 .3 2 . 2 . 2 . 2 . 2 . 2 .3 2 . 2 .2 2 . 2 .3 2 . 2 . 2 . 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 2 2 2 32 2 2 2 2 22 3 23 3 Labor costs Advertising expenses Others SG&A expenses/Net Sales (Million yen) 23,572 23,573 ⚫ Expenses increased YoY because of the growth of business activities but decreased to below 25% of sales. ⚫ No QoQ change as higher personnel and advertising expenses were offset by lower payments for M&A services and other items.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 10 Net Income (Million yen) YoY +８％ QoQ +７％ Net Income (Adjusted) YoY +７％ QoQ +７％ Net Income 2 3 2 2 3 2 2 2 2 3 3 2 2 2 3 2 3 3 2 22 2 23 2 2 2 2 2 3 3 2 3 2 3 2 3 2 3 3 2 2 3 3 3 2 3 2 2 22 2 23 2 2 2 2 2 3 Increased YoY/QoQ and reached record highs for a first half and a quarter.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 11 3 3 3 2 2 3 2 3 Consolidated balance sheet Debt +¥ . bn YoY Goodwill +¥3. bn Equity ratio +1.4pt Shareholder’s equity +¥ .0 bn FY2022 FY2023 Cash Goodwill Equity Debt Goodwill Goodwill Goodwill Equity Equity Equity Cash Cash Cash FY2024 (Billion yen) FY2025 ２Q R&I Rating A-(Stable) Debt Debt Debt 26.3% 34.1% 35.8% 37.2% Equity ratio Equity ratio of more than 37% as debt and equity increased. Equity ratio
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 12 Consolidated cash flows (YoY summary ) ⚫ Operating CF : own with earnings up ¥ . bn but income taxes payable up ¥3. bn (including a 1.5 billion increase due to tax law revisions). ⚫ nvesting C : Cash used increased as investments were up ¥ . bn due mainly to the purchase of a commercial building and development of a new POS register and to ¥3.2bn purchase of subsidiary stock. ⚫ ree C : own to negative ¥ . bn as operating C decreased and negative investing C increased. ⚫ inancing C : New loans to fund subsidiary stock purchases (¥ . bn) and purchase of a commercial building (¥2. bn). 3 3 2 2 2 2 3 3 3 2 C C C C C 2 2 2 2 2 2 2 3 2 3 + 3 Operating CF Investing CF Free CF Financing CF Total CF
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 13 2. Segment information
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 14 Revised segments beginning in FY2025 Financial, Realty & Global Communication & Energy Store & Facility Solutions Content DistributionContent Distribution Store Services Business Systems Communications Energy Rent guarantee Wi-Fi for real estate －VO service “U-NEX ” －MVNO for individuals －Music distribution for stores －Store DX (POS register, Cashless payment, etc.) －Automated payment machines for facilities － Broadband internet service for businesses/stores/individuals － ICT service for business (SaaS, security, VPN, etc. ) － High and low voltage electricity for businesses/stores/individuals －Rent guarantee －Payment services (Acquirer、PSP*) －Real estate (Operation of retail buildings, broadband internet service) Previous segment New segment Main services A payment service provider (PSP) processes electronic payments between credit card and other companies and the stores, EC bus inesses and other member merchants of these companies. MVNO for individuals
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 15 Overview of business segments BtoBBtoC *1 Video on Demand Market Five-year Forecast, GEM Partners *2*GEM Partners, November 2024 *3 U-NEXT HOLDINGS assumptions *4 U-NEXT HOLDINGS assumptions SVOD market share in Japan*1 No.2 Content Distribution Store & Facility Solutions Store Services (Restaurants・Retailers・Beauty salons) Music distribution, POS register, Cashless payment, Catering robots, etc. (Hotels・Hospitals) Number of Subscribers Market share of music distribution for stores in Japan*3 No.1 Automated payment machines market share in Japan*4 No.1 Communication & Energy Communication Broadband internet service, ICT and cloud services etc. Energy High/Low voltage, green energy. Number of Stores 830K Number of Facilities 30K VO service “U-NEX ” Comprehensive solutions to support stores and facilities Business Systems Automated payment machines、reception machine、 Operational Management systems etc. Financial ・Cashless payments ・Credit/leases Realty ・Real estate communication services ・Rent guarantees ・Operation of retail buildings Global (Currently working on a business plan) Financial, Realty & Global 4.6M Largest inventory*2 No.1
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 16 Summary of ２Q results of operations Content Distribution Financial, Realty & Global Communication & Energy Store & Facility Solutions (YoY) Big increases in sales and earnings due to 400,000 more subscribers and the popularity of the soccer package. (QoQ) Sales increased but higher expenses for content and advertising reduced earnings. (YoY) Big increases in sales and earnings due to strong performance in store solutions of music distribution and DX services. (QoQ) Sales and earnings down because of slow store solutions initial sales and decline in demand in facility solutions involving new Japanese banknotes. (YoY) Big increase in energy sales due to larger number of customers but higher expenses, mainly for capacity payments, brought down earnings. (QoQ) Big increases in sales and earnings backed by seasonal upturn in electricity use during the winter. (YoY) Sales and earnings increased because of the growth of real estate communication services, rent guarantees and commercial building operations. (QoQ) The cashless payment business that was acquired beginning in the ２Q started with a small loss.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 17 Content Distribution (Million yen) YoY +18％ QoQ +４％ Net Sales .2 .3 . .3 3 2 2 2 3 3 2 2 2 2 2 3 3 2 3 2 22 2 23 2 2 2 2 2 3 YoY +32％ QoQ▲18％ 3 2 2 3 2 3 2 3 3 2 2 2 2 3 2 2 3 2 2 22 2 23 2 2 2 2 2 3 Operating Income / margin Operating margin (Cumulative) ⚫ Record first half performance driven by more subscribers, the popularity of the soccer package and other factors. ⚫ Earnings down QoQ because of higher expenses for content and advertising.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 18 2. 2. 2. 2. 2. 2. 2 3. 3 3.2 3. 3. 2 3. 3 3. . .23 . 3 . . . . . . . 3 2. 2. 2. 2. 2. 2. 2 3. 3. .2 .2 .3 . . 3 . 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 U NEX Paravi Content Distribution (Subscribers) (Million subscribers) *Includes monthly point service and other subscribers associated with business alliance partners. YoY +390K (+９％) QoQ +130K (+３％) Net change of QoQ (K) More than 4.6 million subscribers with increases of 390,000 YoY and 130,000 QoQ. U-NEXT +95 +107 +69 +94 +88 +87 +107 +221 +333 +138 +109 +137 ＋106 ＋155 Paravi - - - - - - +829 ▲137 ▲80 ▲63 ▲43 ▲28 ▲25 ▲21
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 19 Content Distribution (Marketing expenses) 2 2 2 2 22 2 2 3 2 2 2 2 3 3 2 3 2 2 3 2 3 3 2 3. . 2.3 2.3 . 3. . . 2. .3 . .2 . . 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 Marketing expenses YoY ＋８％ QoQ +12％ Marketing expenses ratio YoY ▲0.9pt QoQ + 0.8pt (Quarter) (Quarter) Up with the big increase in the number of new users attracted by the December start of distribution of combat sports and increased QoQ.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 20 Content Distribution (ARR) ※Annual Recurring Revenue: Monthly Recurring Revenue の12倍 ※Monthly Recurring Revenue:U-NEXTサービス全体の継続課金売上高(PPV等のフロー売上高を除き、音楽配信等付帯月額サービスを含む) ※各四半期最終月の単月売上高ベース YoY +¥ . bn (+10％) QoQ +¥2. bn (+２％) 2 2 3 3 2 3 2 3 223 2 3 3 3 23 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 A ARR is climbing steadily as the number of subscribers increases. *Annual Recurring Revenue : Monthly recurring revenue multiplied by 12. *Monthly Recurring Revenue : Portion of U-NEXT service sales derived from fees paid on a regular basis. (excludes PPV and other one-time sales, includes music distribution and other related services with monthly fees) *Based on sales in the last month of each quarter.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 21 Store & Facility Solutions (Million yen) YoY +９％ QoQ ▲８％ Operating Income / marginNet Sales . .3 .3 . 3 2 3 3 3 3 3 3 2 33 3 3 2 3 2 3 3 3 2 2 2 22 2 23 2 2 2 2 2 3 YoY +17％ QoQ ▲20％ 2 2 2 23 3 2 3 23 23 3 2 22 2 2 2 2 2 2 22 2 23 2 2 2 2 2 3 Operating margin (Cumulative) ⚫ Big YoY increase in store solutions due to music distribution and DX services; record-high earnings for a first half. ⚫ Sales and earnings down QoQ because of slow store solutions initial sales and downturn in demand involving new Japanese banknotes in facility solutions.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 22 3 233 3 3 2 3 3 22 3 2 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 (1) Store Solutions . . . . .3 . . 2. . . . 3. . . ross Pro t argin Gross ProfitNet Sales Sales and earnings are climbing despite the volatility of initial sales. (Million yen)
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 23 2 2 2 23 3 3 2 2 22 23 3 33 3 3 3 2 2 23 2 2 2 2 23 2 32 3 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 Network (internet) services for stores Other store service contracts usic distribution contracts (1) Store Solutions (Number of contracts) YoY +97K (+９％) QoQ +22K (+２％) (Thousand contracts) *Other store services are the sum of POS registers, Wi-Fi, IP cameras, table service robots, digital signage and food delivery franchising. *Network (internet) services for stores are part of the Communication & Energy segment. *Other store services no longer include cashless payment services in all fiscal years shown. This service has changed to GMV disclosure in the Finance, Realty & Global segment. *Contracts are counted separately for individual services even when they are by the same customer. Consistent increase in the number of contracts with net increases of 100,000 YoY and 20,000 QoQ.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 24 (1) Store Solutions (Contracts for three major products) 22 23 2 2 2 2 2 2 2 2 2 2 2 2 3 2 2 2 3 2 32 3 2 2 32 3 2 3 2 2 222 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 POS i i Camera (Thousand contracts) YoY +40K (+22％) QoQ +８K (+４％) * Contracts for three major products are included in other store service contracts on page 23. Increases of 40,000 YoY and 10,000 QoQ backed by the steady growth of all three products.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 25 (1) Store Solutions (ARR for three major products) *Annual Recurring Revenue : Monthly recurring revenue multiplied by 12. *Monthly Recurring Revenue : Sales from services with continuous fees, excluding sales fees and other sales from one-time activities. *Based on sales in the last month of each quarter. (Million yen) YoY +¥ . bn (+17％) QoQ +¥ . bn (+３％) ARR is increasing consistently as the number of contracts climbs.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 26 2 3 3 2 2 3 3 2 3 2 2 3 2 2 3 2 2 23 3 3 2 2 23 2 3 3 33 3 3 3 3 3 3 2 2 3 2 2 2 2 2 2 2 3 3 2 2 3 2 3 2 32 2 2 2 2 2 3 2 3 2 2 2 3 3 3 3 2 33 3 3 3 3 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 (2) Facility Solutions (One-time sales/Recurring sales) 左 : ロ 右 : ロ 粗 左下: カ グ 右下: カ グ粗 . . . . 3 . . 2. 3 . . . . 3. . . カ グ粗 ロ 粗 Upper left: One-time sales Upper right: One-time gross profit Lower left: Recurring sales Lower right: Recurring gross profit (Million yen) Recurring gross profit margin One-time gross profit margin * Recurring: Maintenance fees, hotel management system utilization fees and other recurring income * One-time: Sales of payment kiosks and other one-time income FY2022 FY2023 FY2024 FY2025
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 27 Communication & Energy Operating Income / marginNet Sales . . . . 3 3 3 3 2 3 2 3 3 2 3 3 2 2 3 2 2 2 22 2 23 2 2 2 2 2 3 2 2 2 2 3 3 3 2 22 3 2 3 2 2 3 2223 3 2 2 2 3 2 3 2 3 2 22 2 23 2 2 2 2 2 3 Operating margin (Cumulative) (Million yen) ⚫ Record-high quarterly earnings mainly because of the growth of the energy business. ⚫ Earnings down YoY because of higher capacity payments but a big QoQ earnings increase due to the seasonal increase in electricity use. YoY +40％ QoQ ＋９％ YoY ▲16％ QoQ ＋63％
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 28 (1) Communication: ICT service for business YoY +11％ QoQ +１％ Operating Income / margin YoY +６％ QoQ ▲６％ . . . . 2 2 2 3 3 3 3 3 2 2 2 22 2 23 2 2 2 2 2 3 3 3 3 3 3 22 2 3 2 22 2 23 2 2 2 2 2 3 Net Sales (Million yen) Sales and earnings are climbing YoY, primarily driven by the stable growth of SaaS services. Operating margin (Cumulative) *Due to an omission in the Q1 financial consolidation process following the group reorganization at the beginning of the fiscal year ending August 2025, we have retrospectively revised the figures, resulting in an increase in both net sales and operating income.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 29 (1) Communication: ICT service for business (ARR) 22 3 3 2 333 2 2 3 22 3 23 23 2 2 3 2 3 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 *Annual Recurring Revenue: Monthly recurring revenue multiplied by 12. *Monthly Recurring Revenue: Sales from services with continuous fees, excluding sales fees and other sales from one-time activities. *Based on sales in the last month of each quarter. (Million yen) YoY +¥2. bn (+12％) QoQ +¥ . bn (+２％) ARR climbing steadily with the growth of recurring sales.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 30 (1) Communication: Broadband internet service for stores and individuals YoY +18％ QoQ +４％ Operating Income / marginNet Sales YoY +６％ QoQ ＋７％ . . . . 23 2 2 2 2 2 2 2 3 2 2 3 22 2 2 2 2 22 2 23 2 2 2 2 2 3 3 3 3 3 23 3 3 3 2 3 3 2 3 3 2 3 2 33 3 2 2 22 2 23 2 2 2 2 2 3 (Million yen) Operating margin (Cumulative) Steady growth YoY/QoQ of sales and earnings due to the consistently strong performance of store broadband services.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 31 (1) Communication: Broadband internet service for stores and individuals (Number of contracts) 3 3 2 3 33 3 3 3 2 2 23 2 2 2 22 22 222 23 23 2 2 2 2 2 2 3 3 2 32 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 or individuals or stores (Thousand contracts) YoY +55K (+21％) QoQ +12K (+４％) * Contracts for stores and BtoBtoC models, which are part of the above graph, are included in other service subscribers on page 23. Steady growth in the number of broadband service contracts as the increase in services for stores far offset the decline in services for individuals.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 32 (2) Energy (Million yen) YoY +72％ QoQ ＋13％ Operating Income / marginNet Sales YoY ▲25％ QoQ +226％ 3 3 2 2 3 2 22 3 2 3 3 3 3 3 2 3 2 2 2 22 2 23 2 2 2 2 2 3 .2 . .3 . 2 3 3 3 2 3 3 2 2 22 2 23 2 2 2 2 2 3 Operating margin (Cumulative) ⚫ Capacity payments raised expenses but record-high quarterly sales mainly because of a larger number of customers. ⚫ Earnings decreased YoY because of capacity payments but a big QoQ earnings increase because of high electricity usage during the winter .
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 33 (2) Energy (Number of contracts) (千 ) . . . . . . 3. 3. 2. 2. 2. . . . . . 2. 3. .2 . . . . . .2 . . . . . . . .3 . . . . . . 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 USEN U PO E 2 . 2 . 2 . 3 . 3 . 3 . 3 . 2 . 2 .3 2 .2 2 .2 2 .3 23. 22. . 2. 3. . .3 . . . 2 . 2 . 3 . 3 . . 2 . 32.2 . . 2 . 2 . 3 .2 3 . 3 . 3 . 3 . .3 2. . . 2. .3 22. 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 USEN U PO E ・ U PO E ・ High voltage Low voltageYoY +37 QoQ +２％ YoY +145％ QoQ +22％ USEN DENKI (Low voltage) U-POWER (High voltage) USEN DENKI (Low voltage) U-POWER (Low voltage/BtoB) U-POWER (Low voltage/BtoC) (Thousand customer accounts) (Thousand customer accounts) Steady increase at U-POWER in the number of high-voltage and low-voltage contracts.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 34 Financial, Realty & Global YoY +16％ QoQ +42％ Operating Income / marginNet Sales YoY +８％ QoQ +２％ 2 . 22.3 .2 . 2 3 3 3 2 3 2 3 33 3 3 3 2 22 2 23 2 2 2 2 2 3 3 2 3 2 2 2 2 33 2 2 3 3 2 22 2 23 2 2 2 2 2 3 (百万円)(Million yen) Operating margin (Cumulative) ⚫ YoY/QoQ sales and earnings growth for real estate communications, rent guarantees and commercial building operations. ⚫ The cashless payment business is included in the consolidated financial statements beginning with the 2Q (see TOPICS).
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 35 Financial, Realty & Global (Contracts for major products) 2 2 2 22 23 2 2 2 2 2 3 2 2 3 3 3 3 3 3 3 3 3 2 22 2 23 2 2 2 2 2 3 32 33 3 3 3 3 3 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 eal estate i i Small amount short term insurance ent guarantees (Thousand contracts) YoY +43K (+12％) QoQ +10K (+３％) Consistent growth of all three products with contracts up 40,000 YoY and 10,000 QoQ.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 36 2 2 3 2 3 3 22 3 3 2 2 3 2 2 2 33 3 33 2 3 2 33 32 2 3 2 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 eases Credit (1) Financial (Leases / Credit for small-midsize companies and stores) YoY +¥ . bn (+55％) QoQ ▲¥ . 3bn (▲１％) (Million yen) Due to sluggish new lease originations, the total balance, including credit, remained flat. * USEN FINANCIAL Co., Ltd., which conducts the financial business mentioned above, is currently an equity-method affiliate.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 37 3. Topics
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 38 Content Distribution (Market Share) ⚫ Ranks first among Japanese companies and second after Netflix. ⚫ The only service with constant market share growth, increasing from 15% to 18% during the past year. 2 2 2 2 2 2 2 2 2 22 2 23 2 2 Net ix U NEX Ama on Prime Video A N isney+ ulu emino( d V 22％ ％ 3％ . ％ . ％ ％ ％ Source: Video on Demand Market Five-year Forecast, GEM Partners Market share by total amount paid by consumers for video distribution services
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 39 Content Distribution (More Golf Content) Press release: https://www.unext.co.jp/ja/press-room/golf-lineup-2025-02-18 ⚫ Acquired exclusive rights for all four major men’s golf tournaments and the Japanese women’s golf tour. ⚫ The first-ever distribution in Japan of all four major golf tournaments on a single platform. ⚫ Stream all golf content as unlimited viewing with no extra fee. ■ he four major men’s golf tournaments he world’s most prestigious golf tournament comprised of the four major championships: Masters Tournament, The Open Championship, the PGA Championship and U.S. Open. ■ he Japan women’s golf tour Every year, the Ladies Professional Golfers Association of Japan holds many tournaments throughout Japan.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 40 Content Distribution (Music Subscription Service) ⚫ U-NEXT plans to add a music subscription service*. ⚫ “Video + usic” will be available for a monthly subscription fee when using U-NEXT point. *The Launch date is undecided and the pricing structure and service details are based on current assumptions and may be subject to change in the future ■Acquiring users of other OTTs and music subscriptions for U-NEXT Other OTT service Music subscription＋ U-NEXT (Video ＋ Music subscription) ■Other features ✓Unique hybrid of live music performances + music videos + music in one single service. ✓Enjoy the same music lineup available on other music platforms for a standalone monthly fee of 980 JPY.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 41 Store & Facility Solutions (New Register Service) Press release : https://unext-hd.co.jp/newsrelease/2025/03/usen-nttdata-regi.html ■Strengths of the new service ✓Implemented multilingual support that can be utilized for both inbound customers and foreign employees. ✓Compared to previous OEM offerings, the following has become easier, significantly improving service scalability and flexibility. ①Enhancement development for feature expansion. ②Integration with surrounding services. (including our own and third-party services) ⚫ ave developed “USEN egi” a new POS register service for the food and beverage sector with NTT Data. ⚫ The goal is to raise the number of contracts from the current level of about 30,000 to 100,000 within the next few years.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 42 Communication & Energy (Alliance expansion) ⚫ Collaboration with Merpay, and Started internet and electricity service plans that give users Mercari Points. ⚫ A stronger B2B2C scheme by establishing alliances with companies that have individual end users. Press release : https://unext-hd.co.jp/newsrelease/2025/02/merpay-usennetworks-upower.html Communications/ Energy services Air travel Payment services Current Alliances ？？？ NEW MerpayJAL Asset management Money Forward
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 43 Financial, Realty & Global (Tenant matching service) ⚫ aunched “ enalead” service to match real estate companies with individuals and businesses looking for locations for new stores and restaurants. ⚫ Build relationships with newly opened stores in the upstream points to drive cross-selling of group offerings. Press release : https://unext-hd.co.jp/newsrelease/2024/12/usen-trust-tenalead.html Number of exhibitor member registrations *as of March 2025 for all of the above Number of offers Number of registered merchants (Real estate companies) appx. 1,700 cases appx. 350 cases appx. 3,500 cases
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 44 Financial, Realty & Global (New consolidation of a subsidiary) *GMV (Gross Merchandise Value) : Total Transaction Value *This page shows only payment service provider (PSP) information and does not include the acquiring business that is expected to close. ⚫ NetMove (currently USEN FinTech) was consolidated starting in December 2024. ⚫ Despite the burden of losses due to customer acquisition costs and goodwill amortization, we expect to be profitable next fiscal year. Cashless payment GMV (LTM) 2 3 2 23 3 3 2 2 2 2 2 3 3 3 3 3 2 2 2 2 2 Financial performance of cashless (LTM) Operating loss Goodwill amortization (Million yen) Sales Operating Income (Million yen) *From FY2025, we will enhance our marketing functions specifically for cashless services. * he above includes USEN’s profit and loss (recorded in store solutions) that is scheduled to be transferred to USEN FinTech in Q3.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 45 ４. Appendix
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 46 Integrated Report 2024 has been released ! ＜CEO’s essage＞ ＜Overview of strategy＞ ＜Message from an outside director＞＜Sustainability initiatives＞ Results of operations and other financial information with explanations of strategies, ESG and many other subjects in a single publication. https://ssl4.eir- parts.net/doc/9418/ir_material_for_fiscal_ym9/174135/00.pdf ntegrated eport 2 2 is available here ↓ https://forms.gle/zUeJV74TTigN6vXJ9 Feedback Please take the time to give us your thoughts and suggestions for improvements to make our Integrated Report even better.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 47 Competitive edge Growth strategy Content Distribution ✓ No.2*1 market share in Japan. Unlimited viewing coverage with the absolute No.1*2 in content volume in Japan. ✓ Achieving high ARPU by offering a hybrid model of unlimited viewing and pay-per-use as well as points equivalent to ¥ 2 per month. ✓ Integrated marketing covering the internet, mass media and conventional channels. ✓ Quick and flexible development capability due to a team of highly skilled engineers. ✓ A competitive edge due to the size of the content lineup rather than the production of original content. ✓ Unparalleled service that allows users to seamlessly enjoy the different categories of videos, books, and music and concerts, all in one app. ✓ Further expansion of exclusive titles. ✓ Enlarging and upgrading the sports and music category to make it a core category with movies, anime and dramas. Store & Facility Solutions ✓ No.1 market share in Japan in the markets for providing music to stores and automatic payment kiosks to a variety of facilities. ✓ Stable profit structure backed by a solid customer base established during 60 years. ✓ Nationwide sales team of 1,400 and engineering team of 1,100; these internal resources facilitate fully integrated operations encompassing order receipt, delivery and maintenance services. ✓ A partner network of 17,000 companies for sending customers to these partners. ✓ Use a platform of communication environments for upselling more than 60 IoT/DX products and services. ✓ Focus on newly opened stores, where there is a high ratio of contracts for packages of services; use a cycle of stores that close and stores that open to replace these stores to establish upselling. ✓ Developing white space for business hotels/general hospitals/small and medium-sized medical institutions. ✓ Assemble a lineup of services that matches customers’ needs. Communication & Energy ✓ Provides multivendor ICT services by using a sales team for corporate customers. ✓ Uses direct sales and a network of 250 sales agents to sell broadband services to stores. ✓ Two categories of services: USEN DENKI for fixed-rate electricity and U-POWER for variable rate electricity. ✓ Able to revise with flexibility the lineup of electricity services in response to changes in the cost of purchasing electricity. ✓ Goal is steady growth backed by a lineup of corporate ICT services that match customers’ needs. ✓ Increase sales of broadband services for stores to create more DX/IoT product cross-selling opportunities. ✓ Cost reductions with the electricity services, leading to cross-selling of other Group's products. ✓ he roup’s diverse sales channels and large number of customers can be used effectively to sell electricity, which is essential for every home and business. Financial, Realty & Global ✓ A variety of financial services for stores. ✓ Specializes in the retail/commercial building category; no office or residential properties. ✓ Global activities are mainly activities targeting demand involving foreign tourists in Japan; no emphasis on overseas operations. ✓ Provision of integrated cashless payment service, including acquirer and payment processing activities; more customers due to greater convenience and more opportunities for cross-selling other Group products. ✓ In addition to receiving lease payments from tenants, create opportunities for cross-selling other Group products. ✓ Create services and businesses that span demand involving foreign tourists in Japan and the use of the U-NEX roup’s resources. Segment overview *Source: *1 GEM Partners Video on Demand Market Five-year Forecast Reports *2 GEM Partners, Novemver 2024
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 48 Portfolio management Sustained growth backed by use of stable business cash flows for large investments for High-growth businesses and New development businesses. Store & Facility Solutions Communication & Energy Financial, Realty & Global Content Distribution Greater Investments Market growth potential Bigger New development businesses High-growth businesses Stable growth businesses ●Financial, Realty & Global ●Store & Facility Solutions (Excluding store DX) ●Communication & Energy 【Disclosure segments】 ● Content Distribution ●Store & Facility Solutions (Store DX)
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 49 FY2025 Forecast (Key points) Content Distribution ⚫ YoY increase in subscribers of 300,000. (+400,000 at U-NEXT and -100,000 at the former Paravi) ⚫ orecasts use an e change rate of ¥ /US. ⚫ No change in marketing expenses vs. FY2024. ⚫ Profitability improved with no change in profit structure despite increases in system costs and personnel expenses. Store & Facility Solutions ⚫ Estimated drop impact in replacement demand for automatic pay machines is -¥5.0 bn in sales and -¥2.5 bn in profit. ⚫ Excluding the above factors, on an adjusted basis, sales are expected to increase by ¥1.0 bn and profit by ¥0.5 bn. ⚫ Store solution: Music distribution sales increased slightly due to price revision, and DX for stores grew stably. ⚫ Facility solution: Partially offsetting the drop in one -time sales by increasing of recurring revenues. Communication & Energy ⚫ Stable growth in recurring revenue of ICT Service and Broadband internet service for stores and individuals. ⚫ YoY increase in customers of 100 at high voltage, ＋38,000 at low voltage (BtoB +4,000, BtoC +34,000). ⚫ Cost increase impact of capacity payments, which occurs 5 months in FY2024 and 12 months in FY2025, is ¥3.3 bn. ⚫ The cost increases will be passed on to customers through price increases, resulting in sales increase of ¥20.0 bn and profit increase of ¥1.7 bn YoY. Financial, Realty & Global ⚫ Increase in sales and earnings due to stable growth in rent guarantee business. ⚫ Newly consolidated a commercial building management subsidiary from the beginning of FY2025, contributing to sales/profit (plans to acquire 5 additional properties during FY2025). ⚫ Cashless payment business M&A (completed in FY2025) proceeds are not factored in. (Sales increase is expected to have a limited impact on profit and loss due to goodwill amortization expenses) Adjustment ⚫ Decrease in branding costs in FY2024. (FY2025 branding costs will be determined based on business conditions.) ⚫ Increase in personnel expenses and commissions paid.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 50 EPS (LTM) *LTM: Last Twelve Month EPS YoY +¥7.2 QoQ +¥1.9 EPS (adjusted) YoY +¥7.5 QoQ +¥2.2 . . .3 .2 . .3 . . .3 . . .2 .2 . 2. . . . . .3 .2 . . .3 . 2. . . 2 3 2 3 2 3 2 2 22 2 23 2 2 2 2 EPS EPS (yen) (Quarter) (Quarter) (adjusted) A small YoY increase because of higher net income.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 51 Consolidated balance sheet (Million yen) FY2024 FY2025 2Q Difference (Assets) Current assets 150,218 154,260 +4,041 Cash and deposits 52,738 49,962 ▲2,775 Notes and accounts receivable-trade 41,246 39,768 ▲1,478 Inventories 11,302 12,650 +1,348 Prepaid expenses 40,694 47,305 +6,611 Other 4,236 4,572 +336 Non-current assets 78,743 87,673 +8,930 Property, plant and equipment 21,056 24,743 +3,686 Intangible assets 47,194 53,286 +6,091 Goodwill 39,490 42,563 +3,072 Other 7,704 10,722 +3,018 Investment and other assets 10,491 9,644 ▲847 Total assets 228,962 241,934 +12,971 (Million yen) FY2024 FY2025 2Q Difference (Liabilities) Current liabilities 71,529 68,559 ▲2,969 Notes and accounts payable-trade 33,686 32,765 ▲921 Short-term loans payable - - - Current portion of long-term loans payable 3,066 3,153 +87 Other 34,776 32,640 ▲2,135 Non-current liabilities 65,399 72,689 +7,290 Bonds payable 10,000 10,000 - Long-term loans payable 49,822 57,240 +7,417 Other 5,576 5,449 ▲127 Total liabilities 136,928 141,249 +4,320 (Net assets) Shareholder’s equity 81,729 89,724 +7,994 Capital stock 99 99 - Capital surplus 29,786 29,786 - Retained earnings 51,843 59,838 +7,994 Treasury stock -0 -0 -0 Valuation and translation adjustments 138 164 +26 Non-controlling interests 10,166 10,795 +629 Total net assets 92,033 100,685 +8,651 Total liabilities and net assets 228,962 241,934 +12,971 ⚫ Current assets: Expenditures for acquiring content are the main reason for higher prepaid expenses. ⚫ Non-current assets: Property, plant and equipment up because of the purchase of a commercial building; intangible assets up because of software for developing the new POS register service. ⚫ Liabilities: Current assets and other liabilities increased mainly because of new long-term loans to fund acquisitions and the purchase of a commercial building; trade payables decreased. ⚫ Net assets: Equity increased because of the growth of retained earnings, offset somewhat by deductions for dividend payments.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 52 Return on equity (LTM) *Return on Equity: Net Income/Sales ratio × Asset Turnover ratio × Financial Leverage *Net Income/Sales ratio: Profit or Loss attributable to owners of parent /Net Sales *Asset Turnover Ratio: Net Sales / Total assets *Financial Leverage: Total assets / (Net assets – Subscription rights to shares – Non-controlling interests) 23. 2 .2 2 . .3 2 22 2 23 2 2 2 2 2 eturn on Equity 3. . . . 2 22 2 23 2 2 2 2 2 . . . . 2 22 2 23 2 2 2 2 2 . 3.3 2. 2. 2 22 2 23 2 2 2 2 2 Net Income/Sales Ratio Asset Turnover Ratio Financial Leverage Only small changes in all three components of the return on equity.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 53 Leverage ratio (LTM)/Debt/Equity ratio Leverage Ratio (LTM) Debt/Equity Ratio *LTM : Last Twelve Month *Gross Leverage ratio : Debt / EBITDA *Net Leverage ratio : (Debt－Cash) / EBITDA * ross ebt/Equity ratio : ebt / Shareholder’s equity *Net Debt/Equity ratio : (Debt－Cash) / Shareholder’s equity 2.3 2. . . .3 . .3 . 2 22 2 23 2 2 2 2 2 グロ . . . . . .2 . .2 2 22 2 23 2 2 2 2 2 グロ /E /E Gross Leverage ratio Net Leverage ratio Gross Debt/Equity ratio Net Debt/Equity ratio (times)(times) Small upturns in the leverage and debt/equity ratios as debt and equity increased.
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 54 (Billion yen) FY2022 Actual FY2023 Actual FY2024 Actual FY2025 Forecast Remarks ROE ①＝②/③ 23.6% 20.2% 20.4% 18.8% Small increase in FY2024 Net Income - ② 8.7 11.0 15.4 16.7 Shareholder’s equity (Average) - ③ 36.5 54.0 74.9 88.9 ROIC ④＝(⑤×(1－⑥)/(③＋⑦) 11.3% 11.9% 13.5% 12.7% Big increase in FY2024 Operating Income - ⑤ 17.3 21.6 29.1 31.0 Effective tax rate - ⑥ 36％ 36% 36％ 36% Shareholder’s equity (Average) 36.5 54.0 74.9 88.9 Debt (Average) - ⑦ 61.7 61.7 63.4 66.7 Increased because of funds procured for M&A and real estate purchases Cost of capital ⑧＝⑨＋(⑩×⑪) 10.3% 10.6% 7.2% 7.2% FY2024 was down significantly from previous year (no change expected in FY2025) 10-year Japanese gov’t bond - ⑨ 0.2% 0.7% 0.9% 0.9% Based on the last day of each fiscal year Market risk premium - ⑩ 7.4% 7.0% 5.5% 5.5% Average of each fiscal year Shareholder beta - ⑪ 1.36 1.42 1.15 1.15 60 months with 95% confidence interval WACC ⑫＝⑧×⑬＋⑭×⑮ 4.8% 5.9% 4.5% 4.5% Equity ratio is increasing (more financial soundness) Cost of shareholder’s equity 10.3% 10.6% 7.2% 7.2% Shareholders’ equity ratio - ⑬ 40% 52% 57% 58% Cost of debt - ⑭ 1.1% 0.8% 1.0% 0.9% Debt to Total Assets - ⑮ 60% 48% 43% 42% Equity spread ①－⑧ 13.3% 9.5% 13.3% 11.6% EVA spread ④－⑫ 6.5% 6.1% 8.9% 8.2% Equity spread & EVA spread
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Copyright © U-NEXT HOLDINGS Co., Ltd. All Rights Reserved. 55 This presentation includes opinions, forecasts and other statements that are based on the judgments of management when this presentation was prepared. As this information incorporates risk factors and other uncertainties, U-NEXT HOLDINGS makes no promise that this information is accurate or complete. Forward-looking Statements Selected for FY2021-2024