AEON Mall : Consolidated Financial Results for the First Quarter of the Fiscal Year Ending February 28, 2022 (Japanese GAAP)

This is an abridged translation of the original Japanese document and is provided for informational purposes only.

If there are any discrepancies between this and the original, the original Japanese document prevails.

Consolidated Financial Results for the First Quarter of the Fiscal Year

Ending February 28, 2022 (Japanese GAAP)

		July 6, 2021
Company name:	AEON MALL Co., Ltd.	Stock Exchange Listing: TSE
Stock code:	8905	URL https://www.aeonmall.com/en/ir/index.html
Representative:	Yasutsugu Iwamura, President and CEO

Scheduled date of filing of quarterly report: July 13, 2021			Starting date of dividend payment: −
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results briefing: Yes (for institutional investors and analysts)
				(Amounts in millions of yen rounded down to the nearest million yen)
1. Consolidated Financial Results for the First Quarter of the Fiscal Year Ending February 2022 (March 1, 2021 - May 31, 2021)
(1) Consolidated Operating Results (cumulative)				(Percentages represent year-on-year changes)
	Operating revenue	Operating income	Ordinary income	Net income attributable
	to owners of parent
	Million yen		%	Million yen	%	Million yen	%	Million yen	%
Three months ended May 31, 2021	76,207		44.4	10,822	337.9	8,888	744.9	8,879	－
Three months ended May 31, 2020	52,790		(34.6)	2,471	(83.7)	1,051	(91.8)	(13,476)	－
(Note) Comprehensive income: Three	months ended May 31, 2021: ¥23,719 million (-%)
Three months ended May 31, 2020: (¥25,708) million (-%)
	Net income per share	Net income per share (diluted)
			Yen			Yen
Three months ended May 31, 2021			39.02			39.01
Three months ended May 31, 2020			(59.23)			－

(Note) Diluted net income per share for the three months ended May 31, 2021, is not provides, as the company recorded a net loss per share for shares with dilutive effect.

(2) Consolidated Financial Position
		Total assets		Net assets	Equity ratio
		Million yen		Million yen		%
May 31, 2021		1,427,424		406,584		27.8
February 28, 2021		1,394,199		387,486		27.1
(Reference) Equity: May 31, 2021: ¥396,630 million
February 28, 2021: ¥377,318 million
2. Dividends
						Annual Dividend
			First quarter-end	First half-end	Third quarter-end	Fiscal year-end	Total
				Yen	Yen	Yen		Yen	Yen
Year ended February 28, 2021			－	20.00	－	20.00	40.00
Year ending February 28, 2022			－
Year ending February 28, 2022 (projection)		25.00	－	25.00	50.00
(Note) Revisions to dividend forecast announced	recently: None

3. Consolidated Earnings Projections for the Year Ending February 28, 2022 (March 1, 2021 - February 28, 2022)

							(Percentages represent year-on-year changes)
							Net income		Net income per
	Operating revenue	Operating income	Ordinary income	attributable to
		share
							owners of parent
	Million yen	%	Million yen	%	Million yen	%	Million yen		%	Yen
First half, FY2021	167,000	32.5	26,500	125.3	23,000	156.0	18,000		－	79.10
Full-year	344,000	22.6	59,000	71.5	50,500	77.6	31,000		－	136.23

(Notes) 1. Revisions to earnings forecast announced recently: None

* Notes

(1) Material changes in consolidated subsidiaries during the period (changes in specific subsidiaries resulting in a change in the scope of consolidation): Yes

(2) Application of special accounting methods in the preparation of quarterly consolidated financial statements: None
(3) Changes in accounting policies, changes of accounting-based estimates, revisions & restatements
[1]	Changes in accounting policies due to changes in accounting standards, etc.: None
[2]	Changes in accounting policies other than the above: None
[3]	Changes in accounting estimates: None
[4]	Revisions and restatements: None
(4) Number of shares issued and outstanding (common stock)
[1]	Number of shares outstanding at period-	Three months ended	227,546,939	Year ended	227,545,839
	end (including treasury stock)	May 31, 2021	February 28, 2021
[2] Treasury stock at period-end	Three months ended	3,513	Year ended	3,265
May 31, 2021	February 28, 2021
[3] Average number of shares during the	Three months ended	227,542,950	Three months ended	227,525,045
	period (quarterly cumulative)	May 31, 2021	May 31, 2020

* The summary of quarterly financial results is exempt from quarterly review procedures.

* Explanations and other special notes concerning the appropriate use of earnings projections (Cautionary statement regarding forward-looking statements, etc.)

The forward-looking statements, such as earnings projections, included in these materials are based on information currently available to the Company and certain assumptions it deems reasonable. They do not constitute a promise of future performance by the Company. Moreover, actual performance may vary considerably due to a variety of factors. See 1. Qualitative Information on Quarterly Financial Performance (3) Explanation of Consolidated Earnings Projections and Other Projections on P.11 of the accompanying materials for assumptions used in earnings projections and matters to note when using earnings projections.

(Procedures for obtaining supplementary information on financial results)

The Company is scheduled to hold a briefing for institutional investors and analysts on July 7, 2021. The materials handed out at this briefing will be posted on the Company's website on July 6, 2021, and an audio recording of the briefing will be made available on the Company's website soon after the briefing has ended.

Accompanying Materials ― Contents

1. Qualitative Information on Quarterly Financial Performance	2
(1)	Explanation of Operating Results	2
(2)	Explanation of Financial Position	10
(3)	Explanation of Consolidated Earnings Projections and Other Projections	11
2. Quarterly Consolidated Financial Statements and Notes	12
(1)	Quarterly Consolidated Balance Sheets	12
(2)	Quarterly consolidated Statements of Income and Consolidated Statements of Comprehensive Income	14
	Quarterly Consolidated Statements of Income
	For the three months ended May 31, 2020 and May 31, 2021	14
	Quarterly Consolidated Statements of Comprehensive Income
	For the three months ended May 31, 2020 and May 31, 2021	15
(3)	Quarterly Consolidated Statement of Cash Flows	16
(4)	Notes to the Quarterly Consolidated Financial Statements	17
	Notes on the going concern assumption	17
	Notes on significant changes in shareholders' equity	17
	Changes in major consolidated subsidiaries during the period under review	17
	Supplementary information	17
	Segment and other information	18
	Significant subsequent events	18

－ 1 －

1. Qualitative Information on Quarterly Financial Performance

1. Explanation of Operating Results

a. Explanation of consolidated results of operations

The Company has defined a long-term vision through the fiscal year ending February 2026 (FY2025) by which we will pursue our management philosophy and achieve further business growth. We are working together with local communities to achieve sustainable growth by creating social, environmental, and economic value.

Our current medium-term management plan (FY2020-FY2022), which we launched in fiscal 2020, outlines four growth policies:

1. Achieve high profit growth overseas; (2) Achieve stable growth in Japan; (3) Pursue a financing mix and strengthen governance structures to support growth; and (4) Pursue ESG-based management.

In pursuing growth initiatives, we have established certain management issues and a vision for our future: (1) Achieve profit growth in overseas businesses and accelerate new mall openings; (2) Maximize the attractiveness of brick-and-mortar malls through customer experience (CX); (3) Build next-generation malls and pursue the urban shopping center business; (4) Pursue digital transformation (DX); and (5) Plan and pursue medium-term strategies, while accelerating reform based on ESG perspectives. Through these efforts, we will continue to provide solutions to regional and social issues, establishing our position through social infrastructure functions to be a central facility for the local community.

Based on the AEON COVID-19 Prevention Protocol, a standard for quarantine measures established by the AEON Group to protect the health and livelihoods of customers and employees, we will continue to establish improved mall environments and operating systems that offer thorough infection prevention measures. We view this as an opportunity to reinvent our business models and create malls that offer new concepts and service functions in the era of the new normal. We will strive to create malls that respond to social change in Japan and overseas.

During the first quarter of the consolidated fiscal year, COVID-19 infections remained uncontained, although differences were evident among various countries and regions. Certain of our malls in Japan and overseas were forced to shorten operating hours or close temporarily.

We recorded higher revenue and profit for the three months ended May 31, 2021, compared to the same period in the previous fiscal year. Operating revenue amounted to ¥76,207 million (+44.4% year on year), while operating income amounted to ¥10,822 million (+337.9%), ordinary income amounted to ¥8,888 million (+744.9%), and quarterly net income attributable to owners of parent amounted to ¥8,879 million (compared to net loss of ¥13,476 million in the year-ago period). Operating revenue, operating income, ordinary income, and net income attributable to shareholders of the parent company were -5.6%,-28.5%,-30.9%, and +11.1% compared to the results recorded in the year-ago quarter, which was not impacted by COVID-19.

Fixed costs for the three months ended May 31,2021, amounted to ¥1,561 million stemming from temporary closures and other factors. We posted these costs as extraordinary losses due to COVID-19.

◆ Consolidated Earnings			(Million yen)
	FY2020 Q1	FY2021 Q1	Change [YoY]
Operating revenue	52,790	76,207	+23,416
[+44.4%]
Operating income	2,471	10,822	+8,350
[+337.9%]
Ordinary income	1,051	8,888	+7,836
[+744.9%]
Net income (loss) attributable to owners	(13,476)	8,879	+22,355
of parent	[－]

－ 2 －

(Reference) Three months ended May 31, 2019)

(Million yen)

FY2019 Q1

FY2021 Q1

Change

(vs. FY2019 Q1)

Operating revenue

80,690

76,207

(4,483)

[-5.6%]

Operating income

15,137

10,822

(4,315)

[-28.5%]

Ordinary income

12,862

8,888

(3,974)

[-30.9%]

Net income attribute to owners of parent

7,991

8,879

+887

[+11.1%]

b. Explanation of business performance by segment

◆Earnings by Segment

(Million yen)

Operating Revenue

Segment Income (loss)

FY2020 Q1

FY2021 Q1

Change [YoY]

FY2020 Q1

FY2021 Q1

Change [YoY]

Japan

44,175

62,024

+17,849

2,716

8,035

+5,318

[+40.4%]

[+195.7%]

China

4,985

10,327

+5,342

(1,019)

2,299

+3,319

[+107.1%]

[－]

ASEAN

3,629

3,854

+225

768

480

(287)

[+6.2%]

[-37.4%]

Overseas

8,615

14,182

+5,567

(251)

2,780

+3,032

[+64.6%]

[－]

Adjustments

－

－

－

6

6

－

[－]

[+0.0%]

Total

52,790

76,207

+23,416

2,471

10,822

+8,350

[+44.4%]

[+337.9%]

(Reference) Three months ended May 31, 2019

(Million yen)

Operating Revenue

Segment Income

FY2019 Q1

FY2021 Q1

Change

FY2019 Q1

FY2021 Q1

Change

(vs. FY2019 Q1)

(vs. FY2019 Q1)

Japan

68,575

62,024

(6,550)

12,837

8,035

(4,802)

[-9.6%]

[-37.4%]

China

8,988

10,327

+1,339

1,584

2,299

+715

[+14.9%]

[+45.2%]

ASEAN

3,126

3,854

+728

709

480

(228)

[+23.3%]

[-32.2%]

Overseas

12,115

14,182

+2,067

2,293

2,780

+486

[+17.1%]

[+21.2%]

Adjustments

－

－

－

6

6

－

[－]

[+0.0%]

Total

80,690

76,207

(4,483)

15,137

10,822

(4,315)

[-5.6%]

[-28.5%]

1. Overseas

The Company recorded higher revenue and profits overseas. Operating revenue amounted to ¥14,182 million (+64.6% year on year). Operating income amounted to ¥2,780 million (compared to operating loss of ¥251 million in the year-ago quarter). Operating revenue and operating income for the three months ended May 31, 2021, were +17.1%, and +21.2% compared to the results recorded in the year-ago quarter, respectively.

We continue area-dominant mall openings in China, mainly in the four areas of Beijing/Tianjin/Shandong, Jiangsu/Zhejiang,

－ 3 －