AEON Mall : FY2022 1st Half Financial Results

(Percentages represent year-on-yearchanges)

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 Second Quarter of the Fiscal Year

Ending February 28, 2023 (Japanese GAAP)

		October 4, 2022
Company name:	AEON MALL Co., Ltd.	Stock Exchange Listing: TSE
Stock code:	8905	URLhttps://www.aeonmall.com/en/ir/index.html
Representative:	Yasutsugu Iwamura, President and CEO
Scheduled date of filing of quarterly report: October 11, 2022	Starting date of dividend payment: October 21, 2022

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 Second Quarter of the Fiscal Year Ending February 2023 (March 1, 2022 - August 31, 2022)

(1) Consolidated Operating Results (cumulative)

			Operating revenue		Operating income	Ordinary income	Net income attributable
				to owners of parent
			Million yen	%		Million yen	%	Million yen		%	Million yen	%
Six months ended August 31, 2022		194,104	26.0		22,826	16.0	18,533		14.5	7,122	(44.5)
Six months ended August 31, 2021		154,101	22.3		19,684	67.4	16,189		80.2	12,835	－
(Note) Comprehensive income: Six months ended August 31, 2022: ¥53,449 million (90.0%)
	Six months ended August 31, 2021: ¥28,130 million (-%)
			Net income per share		Net income per share (diluted)
					Yen					Yen
Six months ended August 31, 2022			31.30					31.29
Six months ended August 31, 2021			56.40					56.40
(Note) The Company adopted Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) as of the beginning of the
first quarter of the current consolidated fiscal year. Figures for the second quarter of the fiscal year ending February 28, 2023
reflect the application of this accounting standard.
(2) Consolidated Financial Position
		Total assets			Net assets			Equity ratio
			Million yen					Million yen				%
August 31, 2022		1,625,060				473,488				28.4
February 28, 2022		1,463,256				426,931				28.5

(Reference) Equity: August 31, 2022: ¥461,653 million February 28, 2022: ¥416,455 million

(Note) The Company adopted Accounting Standard for Revenue Recognition (ASBJ Statement No. 29) as of the beginning of the first quarter of the current consolidated fiscal year. Figures for the second quarter of the fiscal year ending February 28, 2023 reflect the application of this accounting standard.

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, 2022	－	25.00	－		25.00	50.00
Year ending February 28, 2023	－	25.00
Year ending February 28, 2023 (projection)			－		25.00	50.00

(Note) Revisions to dividend forecast announced recently: None

3. Consolidated Earnings Projections for the Year Ending February 28, 2023 (March 1, 2022 - February 28, 2023)

							(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
Full-year	404,000	－	55,500	45.2	45,500	39.8	23,000		19.3	101.07

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

2. Beginning with the fiscal year ending February 28, 2023, the Company will adopt Accounting Standard for Revenue Recognition (ASBJ Statement No. 29), etc. The consolidated earnings forecast above is based on this standard. Since operating revenue has been affected by the adoption of this standard, we have not shown the percentage change compared with the previous period. Operating income, ordinary income, and net income attributable to owners of parent have not been affected by the application of the standard. Estimating results for the fiscal year ending February 28, 2023 before the adoption of this standard, we expect operating revenue to increase 13.3%.

• Notes
• 1. Material changes in consolidated subsidiaries during the period (changes in specific subsidiaries resulting in a change in the scope of consolidation): None
  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
  4. 1. Changes in accounting policies due to changes in accounting standards, etc.: Yes
     2. Changes in accounting policies other than the above: None
     3. Changes in accounting estimates: None
     4. Revisions and restatements: None

(Note) For more information, see 2. Quarterly Consolidated Financial Statements and Notes (4) Notes to the Quarterly Consolidated Financial Statements (Changes in accounting policies) on P.20

(4) Number of shares issued and outstanding (common stock)
[1]	Number of shares outstanding at period-	Six months ended	227, 557,439	Year ended	227,548,939
	end (including treasury stock)	August 31, 2022	February 28, 2022
[2]	Treasury stock at period-end	Six months ended	4,092	Year ended	3,997
August 31, 2022	February 28, 2022
[3]	Average number of shares during the	Six months ended	227,548,242	Six months ended	227,543,726
	period (quarterly cumulative)	August 31, 2022	August 31, 2021

• 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.14 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 October 5, 2022. The materials handed out at this briefing will be posted on the Company's website on October 4, 2022, 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	13
(3)	Explanation of Consolidated Earnings Projections and Other Projections	14
2. Quarterly Consolidated Financial Statements and Notes	15
(1)	Quarterly Consolidated Balance Sheets	15
(2)	Quarterly Consolidated Statements of Income and Consolidated Statements of Comprehensive Income	17
	Quarterly Consolidated Statements of Income
	For the six months ended August 31, 2021 and August 31, 2022	17
	Quarterly Consolidated Statements of Comprehensive Income
	For the six months ended August 31, 2021 and August 31, 2022	18
(3)	Quarterly Consolidated Statement of Cash Flows	19
(4)	Notes to the Quarterly Consolidated Financial Statements	20
	Notes on the going concern assumption	20
	Notes on significant changes in shareholders' equity	20
	Changes in major consolidated subsidiaries during the period under review	20
	Changes in accounting policies	20
	Supplementary information	20
	Segment and other information	21
	Significant subsequent events	22

- 1 -

1. Qualitative Information on Quarterly Financial Performance

1. Explanation of Operating Results

1) Explanation of consolidated results of operations

AEON MALL Co., Ltd., creating the future of community living as we pursue our basic principle that the customer comes first. Under this management philosophy, is a Life Design Developer (Note) we defined our corporate activities as Heartful Sustainable.

Under this management philosophy, we defined our corporate activities as Heartful Sustainable. In this way, we contribute to the development and revitalization of communities and society as a corporate citizen, striving to achieve sustainable societies through various initiatives.

We develop malls localized to the characteristics of each community we serve in Japan and around the world, contributing to better individual lifestyles and community growth. Through efforts in co-creation with customers, communities, partner companies, shareholders, and investors, we will continue to provide solutions to regional and social issues, establishing our position through social infrastructure functions to be central facilities for local communities.

(Note) Our definition of Life Design extends beyond the framework of the shopping mall. Life Design addresses functions associated with different customer life stages, including not only shopping, but also interaction with other people, cultural development, and other features contributing to future lifestyles.

We recorded higher revenue and profit for the six months ended August 31, 2022 compared to the same period in the previous consolidated fiscal year. Operating revenue amounted to ¥194,104 million (+26.0% year on year), while operating income amounted to ¥22,826 million (+16.0%) and ordinary income amounted to ¥18,533 million (+14.5%) Extraordinary losses included losses of ¥1,782 million (¥2,405 million in the cumulative consolidated second quarter of the previous fiscal year) due to COVID-19, recorded as fixed costs during the temporary closure period. We also recorded an impairment loss of ¥1,731 million yen (¥78 million in the cumulative consolidated second quarter of the previous fiscal year) due to the decision to scrap and build certain aging facilities, as well as provision for loss on store closings of ¥2,017 million (no provision in the cumulative consolidated second quarter of the previous fiscal year). As a result, income before income taxes and other adjustments amounted to ¥12,375 million (-10.3% year on year). In addition, total income taxes increased ¥4,257 million year on year, mainly due to the recording of deferred tax assets in the second quarter of the previous consolidated fiscal year in connection with the absorption- type merger of our subsidiary, OPA Co., Ltd. As a result, net income attributable to owners of parent decreased to ¥7,122 million (-44.5% year on year).

Operating revenue, operating income, ordinary income, and net income attributable to shareholders of the parent company were +20.5%, -21.9%,-26.3%, and -58.2% compared to the results recorded during the second quarter of the consolidated fiscal year ended February 28, 2020, which was not impacted by COVID-19 ("FY2019" below).

◆Consolidated Earnings			(Million yen)
	FY2021 Q2	FY2022 Q2	Change
	[YoY]
Operating revenue	154,101	194,104	＋40,003
			[+26.0%]
Operating income	19,684	22,826	＋3,141
			[+16.0%]
Ordinary income	16,189	18,533	＋2,343
			[+14.5%]
Net income attributable to owners of	12,835	7,122	(5,712)
parent			[-44.5%]

- 2 -

(Reference) Results vs. six months ended August 31, 2019

(Million yen)

FY2019 Q2

FY2022 Q2

Change

(Vs. FY2019

Operating revenue

161,070

194,104

＋33,034

[+20.5%]

Operating income

29,212

22,826

(6,386)

[-21.9%]

Ordinary income

25,157

18,533

(6,624)

[-26.3%]

Net income attributable to

17,043

7,122

(9,920)

owners of parent

[-58.2%]

2) Explanation of business performance by segment

◆Earnings by Segment

(Million yen)

Operating Revenue

Segment Income (Loss)

FY2021 Q2

FY2022 Q2

Change

FY2021 Q2

FY2022 Q2

Change

[YoY]

[YoY]

China

20,964

25,765

＋4,800

4,192

4,453

＋261

[+22.9%]

[+6.2%]

Vietnam

4,155

5,926

＋1,771

861

1,459

＋598

[+42.6%]

[+69.4%]

Cambodia

1,380

2,489

＋1,109

279

617

＋337

[+80.3%]

[+120.4%]

Indonesia

1,828

2,739

＋910

(530)

(542)

(12)

[+49.8%]

[－]

Other

－

－

－

(16)

(7)

＋9

[－]

Overseas

28,329

36,921

＋8,592

4,786

5,980

＋1,194

[+30.3%]

[+25.0%]

Japan

125,771

157,443

＋31,671

14,886

16,832

＋1,946

[+25.2%]

[+13.1%]

Adjustment

－

(259)

(259)

12

12

－

[－]

[+0.0%]

Total

154,101

194,104

＋40,003

19,684

22,826

＋3,141

[+26.0%]

[+16.0%]

- 3 -