Izumi : Support Documentation about the Consolidated Financial Results for the First Quarter of the Year Ending February 28, 2023 (FY2022)

July 12, 2022

IZUMI CO., LTD.

(Stock code: 8273)

Support Documentation about the Consolidated Financial Results for the First Quarter of the Year Ending February 28, 2023 (FY2022)

1. Summary of Financial Results

1) Consolidated Financial Results			(Unit: millions of yen)
	FY2021	FY2022
	1Q	Full Term	1Q	Full Term
	Forecast
Operating revenue	164,954	676,800	110,112	454,300
(YoY)	110.7%	99.6%	-	-
Operating profit	7,832	34,717	7,868	32,600
(YoY)	124.2%	97.0%	-	-
Ordinary profit	8,050	34,696	7,940	32,600
(YoY)	126.1%	96.2%	-	-
Profit attributable to owners of parent	5,081	23,204	5,295	20,900
(YoY)	152.7%	100.7%	-	-
Earnings per share	¥70.97	¥324.45	¥74.09	¥292.40
Total assets	469,731	468,798	472,567
Net assets	246,427	262,433	262,430
Net assets per share	¥3,268.45	¥3,479.26	¥3,483.00
Equity ratio	49.7%	53.0%	52.7%
Total number of issued shares at the	71,665,200	71,665,200	71,665,200
end of period (incl. treasury shares)
Number of treasury shares at the end of	208,190	187,562	187,968
period
Average number of shares during	71,607,042	71,517,631	71,477,411
the period (excl. treasury shares)
Number of consolidated subsidiaries	15	17	15
Number of equity-method affiliates	5	4	4

*Reference

(Before applicatioin)

1Q	Full Term
Forecast
170,394	697,100
103.3%	103.0%
7,868	32,600
100.5%	93.9%
7,940	32,600
98.6%	94.0%
5,295	20,900
104.2%	90.1%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first quarter of the fiscal year ending February 28, 2023 and the financial results forecasts for the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. For reference, each figure for the first quarter of the fiscal year ending February 28, 2023 and the financial results forecasts for the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations are presented outside of the table.

2) Non-consolidated Financial Results

(Unit: millions of yen)

	FY2021	FY2022
	1Q	Full Term	1Q	Full Term
	Forecast
Operating revenue	154,005	632,836	86,493	355,500
(YoY)	111.9%	99.7%	-	-
Operating profit	6,372	28,065	6,542	25,600
(YoY)	133.5%	96.3%	-	-
Ordinary profit	6,495	28,273	6,645	25,600
(YoY)	132.7%	96.1%	-	-
Profit	4,165	19,140	4,707	16,600
(YoY)	174.7%	109.6%	-	-
Dividends per share	-	¥86.00	-	¥86.00
Total assets	408,596	407,231	410,556
Net assets	189,362	201,520	201,608
Equity ratio	46.3%	49.5%	49.1%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first quarter of the fiscal year ending February 28, 2023 and the financial results forecasts for the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. For reference, each figure for the first quarter of the fiscal year ending February 28, 2023 and the financial results forecasts for the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations are presented outside of the table.

*Reference

(Before applicatioin)

1Q	Full Term
Forecast
159,549	651,700
103.6%	103.0%
6,542	25,600
102.7%	91.2%
6,645	25,600
102.3%	90.5%
4,707	16,600
113.0%	86.7%

1

												Consolidated
2. Consolidated Statements of Income									(Unit: millions of yen)
		FY2021	FY2022			*Reference			FY2021
		1Q (Mar-May)	1Q (Mar-May)		(Before applicatioin)			Full Term (Mar-Feb)
		Amount	% of Sales	Amount	% of Revenue		Amount	% of Sales	YoY		Amount	% of Sales
	Operating revenue	164,954	-	110,112	100.0%		170,394	－	103.3%		676,800	-
	Net sales	156,624	100.0%	96,976	88.1%	161,999	100.0%	103.4%		643,280	100.0%
	Gross profit	35,264	22.5%	32,322	29.4%		36,586	22.6%	103.7%		145,943	22.7%
	Operating revenue	8,330	5.3%	13,135	11.9%	8,394	5.2%	100.8%		33,519	5.2%
	Operating gross profit	43,594	27.8%	45,458	41.3%		44,981	27.8%	103.2%		179,463	27.9%
	Selling, general and	35,761	22.8%	37,589	34.1%	37,112	22.9%	103.8%		144,745	22.5%
	administrative expenses
	Personnel expenses	17,195	11.0%	16,843	15.3%	16,843	10.4%	98.0%		66,831	10.4%
	Depreciation	3,679	2.3%	3,597	3.3%	3,597	2.2%	97.8%		15,267	2.4%
	Amortization of goodwill	133	0.1%	133	0.1%	133	0.1%	100.0%		532	0.1%
	Rental expenses	2,871	1.8%	2,845	2.6%	2,844	1.8%	99.1%		11,248	1.7%
	Utilities expenses	1,596	1.0%	3,016	2.7%	2,033	1.3%	127.4%		7,986	1.2%
	Advertising expenses	2,319	1.5%	2,276	2.1%	2,861	1.8%	123.4%		9,647	1.5%
	Other	7,966	5.1%	8,877	8.1%	8,799	5.4%	110.4%		33,230	5.2%
	Operating profit	7,832	5.0%	7,868	7.1%		7,868	4.9%	100.5%		34,717	5.4%
	Non-operating income	499	0.3%	313	0.3%	313	0.2%	62.7%		1,600	0.2%
	Interest and dividend income	55	0.0%	55	0.0%	55	0.0%	99.0%		224	0.0%
	Non-operating expenses	282	0.2%	241	0.2%	241	0.1%	85.4%		1,621	0.3%
	Interest expenses	150	0.1%	119	0.1%	119	0.1%	79.2%		555	0.1%
	Ordinary profit	8,050	5.1%	7,940	7.2%		7,940	4.9%	98.6%		34,696	5.4%
	Extraordinary income	11	0.0%	128	0.1%	128	0.1%	1077.1%		1,039	0.2%
	Extraordinary losses	442	0.3%	86	0.1%	86	0.1%	19.4%		1,456	0.2%
	Profit before income taxes	7,619	4.9%	7,983	7.3%		7,983	4.9%	104.8%		34,280	5.3%
	Total income taxes	2,429	1.6%	2,604	2.4%	2,604	1.6%	107.2%		10,758	1.7%
	Profit attributable to non-controlling interests	108	0.1%	82	0.1%	82	0.1%	76.6%		317	0.0%
	Profit attributable to owners of parent	5,081	3.2%	5,295	4.8%	5,295	3.3%	104.2%		23,204	3.6%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. The presentation of each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations together with the variable factors are presented in the "Breakdown of the amount of financial impact" at the end of this document for reference. In addition, for a more accurate reflection of the real state associated with the application of the accounting standard, we have changed the comparison for each figure for the first three months of the fiscal year ending February 28, 2023 from the previous "% of Sales" to "% of Revenue."

1. Segment Information

	FY2021	FY2022			*Reference			FY2021
	1Q (Mar-May)	1Q (Mar-May)		(Before applicatioin)	Full Term (Mar-Feb)
	Amount	% of Total	Amount	% of Total		Amount	% of Total	YoY	Amount	% of Total
(Operating revenue)
Retail operations	159,955	97.0%	106,106	96.4%	165,055	96.9%	103.2%		656,914	97.1%
Retail-peripheral operations	23,621	14.3%	9,871	9.0%	24,569	14.4%	104.0%		96,419	14.2%
Other	1,282	0.8%	1,476	1.3%	1,476	0.9%	115.1%		5,079	0.8%
Adjustment	- 19,904	- 12.1%	- 7,343	- 6.7%	- 20,707	- 12.2%	-	- 81,611	- 12.1%
Total	164,954	100.0%	110,112	100.0%	170,394	100.0%	103.3%		676,800	100.0%
(Operating profit)
Retail operations	6,714	85.7%	6,643	84.4%	6,643	84.4%	98.9%		29,589	85.2%
Retail-peripheral operations	805	10.3%	1,047	13.3%	1,047	13.3%	130.1%		4,321	12.4%
Other	336	4.3%	242	3.1%	242	3.1%	72.0%		1,004	2.9%
Adjustment	- 23	- 0.3%	- 65	- 0.8%	- 65	- 0.8%	-	- 198	- 0.6%
Total	7,832	100.0%	7,868	100.0%	7,868	100.0%	100.5%		34,717	100.0%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. Each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations is presented for reference.

2

Consolidated

2) Financial Results of Major Subsidiaries (Year-on-yearin parentheses)				*Reference		(Unit: millions of yen)
Company	Business / Segment		FY2021	FY2022					FY2021
	1Q (Mar-May)	1Q (Mar-May)			(Before applicatioin)		Full Term (Mar-Feb)
YOU-ME CARD CO., LTD.	Finance	Operating revenue	2,321	2,060	2,439	( 105.1%)		9,181
	Retail-peripheral operations	Operating profit	501	484		484	( 96.6%)		2,157
IZUMI TECHNO Co., Ltd.	Store management	Operating revenue	3,499	4,120	4,124	( 117.8%)		14,863
	Retail-peripheral operations	Operating profit	293	439	439	( 149.7%)		1,760
IZUMI FOOD SERVICE CO., LTD.	Food services	Operating revenue	1,233	1,403	1,403	( 113.8%)		5,277
	Retail-peripheral operations	Operating profit	-32	31	31	（ -	）		74
Youme Mart Kumamoto Co., Ltd.	Retail	Operating revenue	6,885	6,134	6,833	( 99.2%)		28,083
	Retail operations	Operating profit	137	78		78	( 57.4%)		872
Youme Mart Kitakyushu Co., Ltd.	Retail	Operating revenue	6,879	6,055	6,753	( 98.2%)		27,746
	Retail operations	Operating profit	224	142	142	( 63.6%)		850
YOURS Co., Ltd.	Retail	Operating revenue	5,833	5,451	5,661	( 97.1%)		23,364
	Retail operations	Operating profit	106	52	52	( 49.4%)		409

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. Each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations is presented for reference.

3) Change in Consolidated Operating Profit by Quarter					(Unit: millions of yen)
		FY2020		FY2021			FY2022
				YoY			YoY				YoY
1Q	(Mar-May)	6,305		95.6%	7,832		124.2%		7,868		-
2Q	(Jun-Aug)	10,152		134.1%	8,137		80.2%		-		-
First half total (Mar-Aug)	16,457		116.2%	15,970		97.0%	Forecast	15,100		-
3Q	(Sep-Nov)	8,588		122.5%	7,898		92.0%		-		-
Three quarters total (Mar-Nov)	25,045		118.3%	23,868		95.3%		-		-
4Q	(Dec-Feb)	10,735		100.2%	10,848		101.1%		-		-
Annual total (Mar-Feb)	35,781		112.2%	34,717		97.0%	Forecast	32,600		-

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. Each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations is presented for reference.

3

Consolidated

3. Consolidated Balance Sheets				(Unit: millions of yen)
		As of Feb. 28, 2022	As of May 31, 2022
		Amount	% of Total	Amount	% of Total	Change
	Total assets	468,798	100.0%	472,567	100.0%	+ 3,769
	Cash and deposits	11,621	2.5%	9,912	2.1%	- 1,708
	Notes and accounts receivable - trade, and contract assets	-	-	48,106	10.2%	+ 48,106
	Notes and accounts receivable - trade	42,794	9.1%	-	-	- 42,794
	Merchandise and finished goods	20,381	4.3%	22,365	4.7%	+ 1,984
	Property, plant and equipment	329,367	70.3%	328,540	69.5%	- 826
	Leasehold and guarantee deposits	15,846	3.4%	15,744	3.3%	- 102
	Investment securities	8,729	1.9%	7,526	1.6%	- 1,203
	Other	40,057	8.5%	40,372	8.5%	+ 314
	Liabilities	206,364	44.0%	210,136	44.5%	+ 3,771
	Notes and accounts payable - trade	29,697	6.3%	28,679	6.1%	- 1,017
	Interest-bearing liabilities	99,366	21.2%	93,849	19.9%	- 5,516
	Other	77,301	16.5%	87,607	18.5%	+ 10,305
	Net assets	262,433	56.0%	262,430	55.5%	- 2
	Equity	248,689	53.0%	248,955	52.7%	+ 265
	Non-controlling interests	13,744	2.9%	13,475	2.9%	- 268

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023. The cumulative effect of the retrospective application, assuming the new accounting policy had been applied to periods prior to the beginning of the first three months of the current fiscal year was added to or deducted from the opening balance of retained earnings of the first three months of the current fiscal year, and thus the new accounting policy was applied from such opening balance. As a result of this change, the opening balance of retained earnings decreased by ¥1,449 million.

*Change in the number of issued shares

		FY2021 (Mar-Feb)	FY2022 1Q
Total number of issued shares	at the beginning of the period	71,665,200	71,665,200
	at the end of the period (A)	71,665,200	71,665,200
Treasury shares, etc.	at the beginning of the period	8,106	187,562
	at the end of the period (B)	187,562	187,968
	(Acquired during the period)	200,717	406
	(Share-based remuneration)	21,261	0
	(Cancelled during the period)	0	0
A－B		71,477,638	71,477,232
(Average during the period)		71,517,631	71,477,411

4. Consolidated Statements of Cash Flows			(Unit: millions of yen)
		FY2021	FY2022		FY2021
		1Q (Mar-May)	1Q (Mar-May)		Full Term (Mar-Feb)
	Cash flows from operating activities	- 14,445	+ 9,225		+ 18,577
	Profit before income taxes	+ 7,619	+ 7,983		+ 34,280
	Non-cash loss/gain (depreciation, etc.)	+ 4,300	+ 4,079		+ 17,348
	Increase/decrease in claims and obligations related to operating activities	- 20,069	+ 1,477		- 20,515
	Income taxes and interest income	- 7,535	- 5,765		- 13,077
	Other	+ 1,239	+ 1,450		+ 542
	Cash flows from investing activities	- 5,333	- 2,310		- 14,246
	Capital investment related	- 5,277	- 2,791		- 16,336
	Other	- 55	+ 481		+ 2,089
	Cash flows from financing activities	+ 1,925	- 8,623		- 18,016
	Interest-bearing liabilities related	+ 5,905	- 5,516		- 10,960
	Other	- 3,979	- 3,107		- 7,056
	Increase/decrease in cash and cash equivalents	- 17,853	- 1,708		- 13,685

4

Non-Consolidated

5. IZUMI CO., LTD.: Income Statement and Other Financial Information

1) Statement of Income										(Unit: millions of yen)
	FY2021	FY2022			*Reference			FY2021
	1Q (Mar-May)	1Q (Mar-May)		(Before applicatioin)		Full Term (Mar-Feb)
	Amount	% of Sales	Amount	% of Revenue		Amount	% of Sales	YoY		Amount	% of Sales
Operating revenue	154,005	-	86,493	100.0%		159,549	-	103.6%		632,836	-
Net sales	146,306	100.0%	73,680	85.2%	151,835	100.0%	103.8%		601,881	100.0%
Gross profit	27,974	19.1%	24,875	28.8%		29,102	19.2%	104.0%		116,432	19.3%
Operating revenue	7,699	5.3%	12,812	14.8%	7,713	5.1%	100.2%		30,954	5.1%
Real estate lease revenue	2,034	1.4%	6,745	7.8%	2,067	1.4%	101.7%		8,125	1.4%
Distribution center revenue	2,254	1.5%	-	-	2,391	1.6%	106.0%		9,217	1.5%
Store lease joint management	2,143	1.5%	2,067	2.4%	2,067	1.4%	96.5%		8,470	1.4%
expense revenue
Other	1,266	0.9%	4,000	4.6%	1,187	0.8%	93.7%		5,141	0.9%
Operating gross profit	35,673	24.4%	37,688	43.6%		36,815	24.2%	103.2%		147,387	24.5%
Selling, general and	29,301	20.0%	31,145	36.0%	30,272	19.9%	103.3%		119,321	19.8%
administrative expenses
Personnel expenses	12,178	8.3%	11,828	13.7%	11,828	7.8%	97.1%		47,142	7.8%
Depreciation	3,137	2.1%	3,025	3.5%	3,025	2.0%	96.4%		12,910	2.1%
Rental expenses	2,453	1.7%	2,416	2.8%	2,416	1.6%	98.5%		9,684	1.6%
Store management expenses	2,522	1.7%	2,986	3.5%	2,986	2.0%	118.4%		10,649	1.8%
Utilities expenses	1,219	0.8%	2,563	3.0%	1,569	1.0%	128.7%		6,221	1.0%
Advertising expenses	1,951	1.3%	2,037	2.4%	2,241	1.5%	114.8%		8,173	1.4%
Other	5,838	4.0%	6,287	7.3%	6,205	4.1%	106.3%		24,539	4.1%
Operating profit	6,372	4.4%	6,542	7.6%		6,542	4.3%	102.7%		28,065	4.7%
Non-operating income	365	0.2%	261	0.3%	261	0.2%	71.6%		1,288	0.2%
Interest and dividend income	128	0.1%	126	0.1%	126	0.1%	98.6%		329	0.1%
Non-operating expenses	241	0.2%	158	0.2%	158	0.1%	65.6%		1,080	0.2%
Interest expenses	162	0.1%	133	0.2%	133	0.1%	82.2%		605	0.1%
Ordinary profit	6,495	4.4%	6,645	7.7%		6,645	4.4%	102.3%		28,273	4.7%
Extraordinary income	11	0.0%	230	0.3%	230	0.2%	2072.5%		466	0.1%
Extraordinary losses	425	0.3%	71	0.1%	71	0.0%	16.8%		1,027	0.2%
Profit before income taxes	6,081	4.2%	6,804	7.9%		6,804	4.5%	111.9%		27,712	4.6%
Profit	4,165	2.8%	4,707	5.4%	4,707	3.1%	113.0%		19,140	3.2%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. The presentation of each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations together with the variable factors are presented in the "Breakdown of the amount of financial impact" at the end of this document for reference. In addition, for a more accurate reflection of the real state associated with the application of the accounting standard, we have changed the comparison for each figure for the first three months of the fiscal year ending February 28, 2023 from the previous "% of Sales" to "% of Revenue."

1. Sales Information

	FY2021	FY2022			*Reference			FY2021
	1Q (Mar-May)	1Q (Mar-May)		(Before applicatioin)			Full Term (Mar-Feb)
	Amount	% of Total	Amount	% of Total		Amount	% of Total	YoY	Amount	% of Total
(By Product)
Lifestyle	21,908	15.0%	19,108	25.9%	23,851	15.7%	108.9%		87,609	14.6%
Foods	53,606	36.6%	52,442	71.2%	53,698	35.4%	100.2%		227,820	37.9%
Directly managed stores total	75,514	51.6%	71,550	97.1%		77,549	51.1%	102.7%		315,430	52.4%
Tenants	53,515	36.6%	-	-	57,395	37.8%	107.2%		215,647	35.8%
X-SELL Department	2,262	1.5%	2,130	2.9%	2,411	1.6%	106.6%		10,845	1.8%
Product supply, etc.	15,013	10.3%	-	-	14,479	9.5%	96.4%		59,958	10.0%
Total	146,306	100.0%	73,680	100.0%	151,835	100.0%	103.8%		601,881	100.0%
(By Region)
Chugoku	61,156	41.8%	39,110	53.1%	62,863	41.4%	102.8%		249,878	41.5%
Kyushu	54,219	37.1%	27,052	36.7%	57,101	37.6%	105.3%		225,587	37.5%
Other	30,930	21.1%	7,517	10.2%	31,871	21.0%	103.0%		126,415	21.0%
Total	146,306	100.0%	73,680	100.0%	151,835	100.0%	103.8%		601,881	100.0%

• The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29) and relevant ASBJ regulations from the beginning of the fiscal year ending February 28, 2023, and each figure for the first three months of the fiscal year ending February 28, 2023, is the figure after applying the accounting standard and relevant ASBJ regulations. Each figure for the first three months of the fiscal year ending February 28, 2023 reclassified to the figure before applying the accounting standard and relevant ASBJ regulations is presented for reference.

5