Dentsu Reports Consolidated Financial Results for the Nine Months Ended December 31, 2012 (Japanese GAAP)

  Dentsu Reports Consolidated Financial Results for the Nine Months Ended
  December 31, 2012 (Japanese GAAP)

    — Posts 1,412.1 Billion Yen in Consolidated Billings (Net Sales) (4.0%
year-on-year increase), 38.1 Billion Yen in Operating Income (24.1% increase),
 39.0 Billion Yen in Ordinary Income (4.8% increase) and 19.9 Billion Yen in
                        Net Income (50.2% increase) —

Business Wire

TOKYO -- February 8, 2013

Dentsu Inc. (TOKYO:4324)(ISIN:JP3551520004)(President & CEO: Tadashi Ishii;
Head Office: Tokyo; Capital: 58,967.1 million yen) today convened a meeting of
its Board of Directors at its Head Office in Tokyo at which it finalized its
consolidated and non-consolidated financial results for the nine months ended
December 31, 2012 (April 1–December 31, 2012).

Summary of financial results for the period
During the nine months ended December 31, 2012, the Japanese economy showed a
gradual recovery due to demand from reconstruction in the wake of the Great
East Japan Earthquake and the effects of policies such as Japan's eco-car
subsidy program. However, the situation remained uncertain due to concerns
about the prolonged European government debt crisis as well as the slowdown in
economic growth seen in China and other emerging economies.

Meanwhile, demand for advertising, mainly television spots, showed a strong
upturn in the April-June quarter as the market rebounded from the effects of
the devastating earthquake and tsunami which had affected the advertising
industry during the same period a year earlier. However, against the
background of increasing uncertainty about the future of the global economy,
advertising demand started to slow in the summer.

Under such circumstances, the Dentsu Group (hereinafter "the Group") leveraged
its comprehensive resources and proactively pursued a diverse array of
business opportunities by offering "Integrated Communication Design"
solutions. Furthermore, events such as the London 2012 Olympic Games and
TOYOTA Presents FIFA Club World Cup Japan 2012 provided the Group with
opportunities for multi-faceted business development.

As a result, for the nine months ended December 31, 2012, the Group posted
consolidated billings (net sales) of 1,412,195 million yen, an increase of
4.0% compared with the same period of the previous fiscal year; gross profit
of 248,963 million yen, an increase of 6.0%; operating income of 38,116
million yen, an increase of 24.1%; and ordinary income of 39,098 million yen,
an increase of 4.8%. Net income for the nine months ended December 31, 2012
was 19,939 million yen, an increase of 50.2%.

Looking at the results by business segment, net sales of 1,368,930 million
yen, an increase of 4.0% compared with the same period of the previous fiscal
year, and segment income of 35,106 million yen, an increase of 24.0%, were
posted in the Advertising segment. In the Information Services segment, net
sales of 48,113 million yen, an increase of 9.7%, and segment income of 742
million yen were posted (a segment loss of 461 million yen was posted for the
same period of the previous fiscal year). Net sales in the Other Business
segment totaled 12,365 million yen, a decrease of 9.9%, with segment income of
823 million yen, an increase of 87.3%.

By geographic area, net sales of 1,217,696 million yen, an increase of 1.8%
compared with the same period of the previous fiscal year, and operating
income of 34,781 million yen, an increase of 21.7%, were posted in Japan. In
other countries, net sales of 200,980 million yen, an increase of 19.8%, and
operating income of 3,120 million yen, an increase of 68.8%, were posted.

Regarding Dentsu Group companies with a December 31 closing date, including
subsidiaries in countries other than Japan, their financial results for the
nine months from January 1 to September 30, 2012 are, as a general rule,
incorporated in the consolidated financial results for the nine months ended
December 31, 2012.

Dentsu posted non-consolidated billings (net sales) of 1,037,789 million yen,
an increase of 0.9% compared with the same period of the previous fiscal year;
gross profit of 142,699 million yen, an increase of 2.0%; operating income of
24,705 million yen, an increase of 23.3%; ordinary income of 28,565 million
yen, an increase of 1.8%; and net income of 15,869 million yen, an increase of
31.0%.

For more details regarding the consolidated and non-consolidated results,
please see the presentation slides in the Presentation Materials section of
the company website at:
http://www.dentsu.com/ir/

Reference: Scope of Consolidated Financial Results
As of December 31, 2012, the Dentsu Group includes 150 consolidated subsidiary
companies and 38 affiliated companies accounted for by the equity method. 88
of these companies are located in Japan and 100 in countries other than Japan.
By business segment, 170 of these companies fall into the Advertising segment,
13 into the Information Services segment, and 5 into the Other Businesses
segment.

Outlook for the fiscal year ending March 31, 2013
Although results for the nine months ended December 31, 2012 were slightly
below expectations, advertising demand has been on an upward trend since the
start of the 2013 calendar year. Consequently, there are no revisions to the
forecast of consolidated financial results for the fiscal year ending March
31, 2013 which was announced on November 8, 2012.

On July 12, 2012, Dentsu announced that it had agreed with Aegis Group plc, a
leading global media and digital communications agency headquartered in the
United Kingdom, to proceed with the acquisition of Aegis by scheme of
arrangement under the laws of England and Wales to make it a wholly owned
subsidiary of Dentsu. As of today, February 8, the acquisition of Aegis has
not become effective yet and therefore its performance has not been
contemplated in the Company's consolidated results for the fiscal year ending
March 31, 2013.

Trend of Quarterly Consolidated Financial Results and Forecast for the Fiscal
Year Ending March 31, 2013

(Unit: million yen)
                 Three                Three                Three                Nine
                 months      YoY      months      YoY      months      YoY      months      YoY
FY2012*          ended       change   ended       change   ended       change   ended       change
                 June 30,    (%)      Sept. 30,   (%)      Dec. 31,    (%)      Dec. 31,    (%)
                 2012                 2012                 2012                 2012
                 (Apr–Jun)            (Jul–Sep)            (Oct–Dec)            (Apr–Dec)
Net sales        447,469     11.3     473,566     2.7      491,159     (0.6)    1,412,195   4.0
Gross profit     76,481      12.2     86,172      6.1      86,308      1.1      248,963     6.0
Selling,
general and      66,910      4.7      73,633      3.9      70,302      1.5      210,846     3.3
administrative
expenses
Operating        9,571       126.4    12,539      21.4     16,005      (1.0)    38,116      24.1
income
Ordinary         11,497      78.9     8,287       (37.1)   19,488      10.0     39,098      4.8
income
Net income       5,886       349.8    3,463       (48.3)   10,590      100.9    19,939      50.2
* FY2012: April 1, 2012 to March 31, 2013

 
(Unit: million yen)
                 Six                  Forecast
                 months               for the               FY2012*
                 ended       YoY      six months   YoY      forecast    YoY
FY2012*          Sept. 30,   change   ending       change   announced   change
                 2012        (%)      March 31,    (%)      on Nov. 8   (%)
                 (Apr–Sep)            2013                  2012
                                      (Oct–Mar)
Net sales        921,036     6.7      1,039,963    1.0      1,961,000   3.6
Operating        22,110      51.9     37,889       1.2      60,000      15.4
income
Ordinary         19,784      0.9      37,315       (13.7)   57,100      (9.1)
income
Net income       9,349       16.8     18,750       (13.1)   28,100      (5.0)
* FY2012: April 1, 2012 to March 31, 2013
 

Dentsu's forecast of non-consolidated financial results for the fiscal year
ending March 31, 2013 that was revised on November 8, 2012 remains unchanged:

  * Net sales: 1,440.0 billion yen (2.5% year-on-year increase)
  * Operating income: 39.0 billion yen (23.1% year-on-year increase)
  * Ordinary income: 39.9 billion yen (1.9% year-on-year decrease)
  * Net income: 20.0 billion yen (52.6% year-on-year decrease)

Cautionary statement with respect to forward-looking statements
These business results forecasts have been made by Dentsu on the basis of
currently available information, and hence involve potential risks and
uncertainties. Consequently, actual business results may differ from the
forecasts due to changes in various factors.

 
 
Consolidated Financial Results
for the Nine Months Ended December 31, 2012
(From April 1 to December 31, 2012)
 
1. Summary of Consolidated Balance Sheets
                            
                             (Millions of yen: Rounded down to the nearest one
                             million yen)
                             As of               As of
                             March 31,           December 31,         % Change
                             2012                2012
ASSETS
Current assets               722,223             580,786              (19.6)
Noncurrent assets            479,671             586,487              22.3
Total assets                 1,201,894           1,167,273            (2.9)
                                                                       
LIABILITIES
Current liabilities          525,181             479,745              (8.7)
Noncurrent liabilities       119,824             94,767               (20.9)
Total liabilities            645,005             574,513              (10.9)
                                                                       
NET ASSETS
Shareholders' equity         541,929             554,031              2.2
Accumulated other
                             (5,638)             17,239               –
comprehensive income
Minority interests           20,598              21,489               4.3
Total net assets             556,889             592,760              6.4
Total liabilities and net    1,201,894           1,167,273            (2.9)
assets

 
2. Summary of Consolidated Statements of Income
                            
                             (Millions of yen: Rounded down to the nearest one
                             million yen)
                             Nine months           Nine months
                             ended                 ended              % Change
                             December 31,          December 31,
                             2011                  2012
Net sales                    1,357,340             1,412,195          4.0
Gross profit                 234,774               248,963            6.0
Operating income             30,723                38,116             24.1
Non-operating income         10,091                7,414              (26.5)
Non-operating expenses       3,505                 6,433              83.5
Ordinary income              37,309                39,098             4.8
Extraordinary income         499                   233                (53.2)
Extraordinary loss           5,605                 2,810              (49.9)
Income before income taxes
and                          32,203                36,521             13.4

minority interests
Net income                   13,274                19,939             50.2

 
3. Summary of Consolidated Statements of Comprehensive Income
                            
                             (Millions of yen: Rounded down to the nearest one
                             million yen)
                             Nine months           Nine months
                             ended                 ended              % Change
                             December 31,          December 31,
                             2011                  2012
Income before minority       14,151                21,057             48.8
interests
Other comprehensive income   (1,162)               22,961             –
Comprehensive income         12,989                44,018             238.9
                                                                       

About Dentsu Inc.
Founded in 1901, Dentsu Inc. has held the position of the world's largest
single-brand agency for 40 years. Through its unique "Integrated Communication
Design" approach, Dentsu offers multinational clients the most comprehensive
range of advertising and marketing services in the industry. While continuing
to pursue innovation in the digital arena, Dentsu is active in the production
and marketing of sports, movies, anime and other entertainment content on a
global scale. The Dentsu Group has more than 6,000 clients and around 22,000
employees worldwide.
Dentsu News: http://www.dentsu.com/news/index.html
Dentsu Inc.: http://www.dentsu.com/index.html

Contact:

Dentsu Inc.
Shusaku Kannan, (813) 6216-8042
Senior Manager
Corporate Communications Division
s.kannan@dentsu.co.jp