Focused Allocation of Human Resources and Funding for M&A and Infrastructure

「On 10 December 2025, the Company acquired common shares and stock acquisition rights of Digital Holdings Co., Ltd. through a tender offer, the acquisition of all shares in HIBC Co., Ltd. and Time and Space Co., Ltd., asset management companies that were major shareholders of the company, and an absorption-type company split agreement. As a result, the Company's voting rights ratio in Digital Holdings Co., Ltd. reached 51.15%, and Digital Holdings Co., Ltd. and its subsidiaries, including Opt Co., Ltd. and 5 other companies, were made consolidated subsidiaries as of the same date.」

「Acquired shares in Amuse Sports Holdings, which manages top athletes in Japan and the United States, and launched the business as “HAKUHODO Athlete Solution Inc.”」

「In the technology business, HAKUHODO ITTENI, a new company aiming to innovate the demand chain based on a consumer-oriented perspective, and HAKUHODO BRIDGE, a new company responsible for developing and implementing digital services to transform digital touchpoints and experiences, commenced operations in April 2025.」

「From the current interim consolidated accounting period, The Yellow Sheep was included in the scope of consolidation because its shares were acquired. In addition, eMFORCE Inc. was excluded from the scope of consolidation because all of its shares were transferred.」

「The principal consolidated subsidiaries included in the scope of consolidation from the current fiscal year are as follows: conversion into a subsidiary through the acquisition of shares in stages: Public Digital Holdings Ltd.; conversion into subsidiaries through share acquisitions: ㈱RUH and ㈱WUUZY.」

「Cash flows from investing activities amounted to an outflow of ¥13,066 million, due to expenditures for the acquisition of property, plant and equipment (¥5,479 million), intangible assets (¥7,267 million), and investment securities (¥4,220 million), proceeds from the sale of investment securities (¥2,208 million), expenditures for the acquisition of shares and equity interests in subsidiaries (¥2,647 million), and other factors. The comparable figure for the same period of the previous year was an outflow of ¥26,989 million.」

「From the second quarter of the current fiscal year, ㈱RUH was included in the scope of consolidation because its shares were acquired.」

「From the first quarter of the current fiscal year, Public Digital Holdings Ltd. was included in the scope of consolidation because additional shares were acquired, and was excluded from the scope of equity-method application.」

「In addition, Hakuhodo DY Corporate Initiative, a new company established in April 2023 to advance the sophistication and efficiency of the Group's corporate functions, was established. The Company will strengthen the capabilities of its corporate functions through training and recruitment, and create synergies as a cross-group function through the consolidation and standardization of operations and DX.」

「From the third quarter of the current fiscal year, Lexington and MA&TH Entertainment Network were included in the scope of consolidation because they were acquired.」

「From the second quarter of the current fiscal year, SYLVAIN LABS and Kingdom Digital Solutions were included in the scope of consolidation because they were acquired. C2 International was also included in the scope of consolidation because additional shares were acquired, and was excluded from the scope of equity-method application.」

「In April 2022, the Company established Hakuhodo Technologies Co., Ltd., a new company that serves as the Group's technology platform. In addition to consolidating resources dispersed throughout the Group, it will strengthen the recruitment and development of external specialist talent by establishing a human resources management framework suited to engineers as a specialist functions company. During the plan period, the Company will progressively expand its functions, including through proactive recruitment of engineers, and will evolve the entire Group into a more technology-driven corporate group centered on the company.」

「From the first quarter of the current fiscal year, ㈱Hakuhodo DY Matrix was included in the scope of consolidation because it was newly established, while LLC Ailove Digital was included because it was acquired. From the second quarter of the current fiscal year, Rich Talent Group LLC was also included in the scope of consolidation because it was acquired.」

「From the first quarter of the current fiscal year, ㈱Hakuhodo DY Matrix was included in the scope of consolidation because it was newly established, while LLC Ailove Digital was included because it was acquired.」

「Cash flows from investing activities included proceeds from the sale of investment securities (¥8,362 million), expenditures for the acquisition of shares and equity interests in subsidiaries (¥6,145 million), and expenditures for the acquisition of shares and equity interests in subsidiaries involving changes to the scope of consolidation (¥4,820 million).」

「Expenditures for the acquisition of shares and equity interests in subsidiaries (¥6,145 million); expenditures for the acquisition of shares and equity interests in subsidiaries involving changes to the scope of consolidation (¥4,545 million)」

「Total consideration for shares acquired through the tender offer (cash and deposits): TWD 1,742 million (¥6,391 million)」

「In addition, ㈱博報堂ＤＹベンチャーズ and 13 other companies were included in the scope of consolidation because they were newly established, while ㈱西広 and 13 other companies were included because their shares were acquired.」

「From the third quarter of the current fiscal year, ㈱大広WEDO and 1 other company were included in the scope of consolidation because they were newly established, while ㈱Emerge and 4 other companies were included because their shares were acquired. In addition, ㈱ラップス and 1 other company were excluded from the scope of consolidation because their shares were sold.」

「From the second quarter of the current fiscal year, ㈱LossLess and 2 other companies were included in the scope of consolidation because they were newly established, while eMFORCE Inc. and 5 other companies were included because their shares were acquired.」

「From the first quarter of the current fiscal year, ㈱博報堂DYベンチャーズ and 2 other companies were included in the scope of consolidation because they were newly established, while ㈱西広 and 1 other company were included because their shares were acquired. In addition, ㈱博報堂DYデジタル was excluded from the scope of consolidation because it was absorbed by デジタル・アドバタイジング・コンソーシアム㈱, and コイネージ㈱ was excluded because its shares were sold.」

「Going forward, to strengthen the 3 growth platforms described above, we will invest funds not only in M&A but also in data and technology, the development of systems infrastructure, and the strengthening and development of human resources, with the aim of achieving rapid and steady growth.」

「From the third quarter of the current fiscal year, ㈱Sports Technology Lab and 2 other companies were included in the scope of consolidation because they were newly established, while 日本トータルテレマーケティング㈱ and 5 other companies were included because their shares were acquired.」

「From the second quarter of the current fiscal year, ㈱ファーマーズガイド and 6 other companies were included in the scope of consolidation because they were newly established, while Beginnings Communications,Inc. and 3 other companies were included because their shares were acquired.」

「From the first quarter, PT.Hadya Wirya Mahir and 5 other companies were included in the scope of consolidation following their establishment, Kepler Group LLC and 3 other companies were included following the acquisition of equity interests, and 省广博報堂整合営銷有限公司 became a subsidiary under the control criteria and was included in the scope of consolidation.」

「QUANTAM BACKSLASH GLOBAL Inc. and 17 other companies were included in the scope of consolidation following their establishment, while Hornall Anderson Design Works LLC and 17 other companies were included following the acquisition of shares.」

「From the third quarter, ㈱博報堂マーケティングシステムズ and 5 other companies were included in the scope of consolidation following their establishment. Xtentia Integrated Communications Pvt Ltd (India) and 1 other company were removed from the scope following their sale, while ㈱TBWA＼HAKUHODO INTERNATIONAL was removed following its liquidation.」

「From the first quarter, QUANTUM BACKSLASH GLOBAL Inc. and 3 other companies were included in the scope of consolidation following their establishment, while Hornall Anderson Design Works LLC and 3 other companies were included following the acquisition of shares. From the second quarter, ㈱OMD HAKUHODO and 4 other companies were included following their establishment, while One Yard SAS was included following the acquisition of shares.」

「Gross profit increased by ¥4.907 billion from the previous year to ¥58.458 billion, up 9.2%, reflecting the steady expansion of existing businesses and the boost from the inclusion of newly consolidated subsidiaries. Selling, general and administrative expenses increased 6.1% as a result of strengthening the operating platform through M&A and making strategic investments in costs,」

「D.A.コンソーシアムホールディングス㈱ and 14 other companies were included in the scope of consolidation following their establishment, while Integrated Communications Group Pte Ltd. and 33 other companies were included following the acquisition of shares.」

「Date of business combination: 3 October 2016 The company's subsidiaries Digital Advertising Consortium Inc. and ㈱アイレップ established a joint holding company and integrated their management in order to respond appropriately to changes in the expanding internet advertising market, which was undergoing significant environmental change, and achieve sustainable development.」

「Selling, general and administrative expenses increased 8.3% as a result of strengthening the operating platform through M&A and other measures and making strategic investments in costs. In addition, from the second quarter, ㈱Ｋ・Ｍ・Ｊ and 1 other company were included in the scope of consolidation following the acquisition of shares.」

「Gross profit increased by ¥5.085 billion from the previous year to ¥53.551 billion, up 10.5%, as a result of continuing various initiatives to improve profitability across the group. Selling, general and administrative expenses increased 12.5% as a result of strengthening the operating platform through M&A and making strategic investments in costs, as well as increases in retirement benefit expenses and amortization of goodwill.」

「Going forward, we will continue to focus talent on the three growth drivers described above and invest actively in M&A and infrastructure development, aiming for rapid and steady growth.」