MINISTOP : Consolidated Financial Results for the Three Months Ended May 31, 2022

Disclaimer: This document is an English translation of the original document in Japanese and has been prepared solely for reference purposes. In the event of any discrepancy between this English translation and the original in Japanese, the original shall prevail in all respects.

Consolidated Financial Results

for the Three Months Ended May 31, 2022

[Japanese GAAP]

July 6, 2022

Company name: MINISTOP Co., Ltd.

Stock exchange listing: Tokyo Stock Exchange

Code number: 9946

URL: https://www.ministop.co.jp/ corporate/ir/

Representative: Akihiro Fujimoto, President and Representative Director

Contact: Hiroshi Kusayanagi, Executive Officer, General Manager of Business Administration

Phone: [phone]

Scheduled date of filing quarterly securities report: July 7, 2022

Scheduled date of commencing dividend payments: -

Availability of supplementary explanatory materials on quarterly financial results: Available

Schedule of quarterly financial results briefing session: Not scheduled

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Three Months Ended May 31, 2022 (March 1, 2022 - May 31, 2022)

(1) Consolidated Operating Results			(% indicates changes from the previous corresponding period.)
		Gross operating	Operating profit		Ordinary profit		Profit attributable to
		revenue					owners of parent
	Three months ended	Million yen	%	Million yen	%	Million yen	%	Million yen	%
	May 31, 2022	20,552		-	(729)		-	(546)	-	14,253	-
	May 31, 2021	46,508	4.9	(1,877)		-	(1,742)	-	(1,849)	-
	(Note) Comprehensive income: Three months ended May 31, 2022: ¥14,010 million [-%]
		Three months ended May 31, 2021: ¥(1,567) million [-%]
		Basic earnings			Diluted
				earnings
		per share
				per share
	Three months ended	Yen			Yen
	May 31, 2022	491.34			491.29
	May 31, 2021	(63.76)		-

(Note) The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and other standards from the beginning of the three months ended May 31, 2022. The figures for the three months ended May 31, 2022 reflect these accounting standards, and therefore, changes from the previous corresponding period are not shown.

(2) Consolidated Financial Position

	Total assets	Net assets	Equity ratio
	Million yen	Million yen	%
As of May 31, 2022	88,944	42,362	47.6
As of February 28, 2022	117,261	28,487	24.3

(Reference) Equity: As of May 31, 2022: ¥42,312 million As of February 28, 2022: ¥28,441 million

(Note) The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and other standards from the beginning of the three months ended May 31, 2022. The figures for the three months ended May 31, 2022 reflect these accounting standards.

2. Dividends

				Annual dividends
		1st quarter-end	2nd quarter-end		3rd quarter-end	Year-end	Total
		Yen	Yen		Yen	Yen	Yen
Fiscal year ended		-	10.00		-	10.00	20.00
February 28, 2022
Fiscal year ending		-
February 28, 2023
Fiscal year ending
February 28, 2023			10.00		-	10.00	20.00
(Forecast)

(Note) Revision to the dividend forecast announced most recently: None

3. Consolidated Financial Results Forecast for the Fiscal Year Ending February 28, 2023 (March 1, 2022 - February 28, 2023)

(% indicates changes from the previous corresponding period.)

	Gross operating					Profit attributable	Basic earnings
	Operating profit	Ordinary profit	to owners of
	revenue			per share
						parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	80,500	-	(200)	-	(400)	-	10,200	-	351.61

(Note) Revision to the financial results forecast announced most recently: None

(Note) The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020) and other standards from the beginning of the three months ended May 31, 2022. The figures of the consolidated financial results forecast stated above reflect these accounting standards, and therefore, changes from the previous corresponding period are not shown.

* Notes:

1. Changes in significant subsidiaries during the period under review: Yes (Changes in specified subsidiaries resulting in changes in scope of consolidation) Newly included: -
   Excluded: one company (MINISTOP Korea Co., Ltd.)
2. Accounting treatment particularly for the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, changes in accounting estimates and retrospective restatement
4. 1. Changes in accounting policies due to the revision of accounting standards: Yes
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting estimates: None
   4. Retrospective restatement: None

(Note) For details, please see "2. Quarterly Consolidated Financial Statements and Principal Notes (3) Notes to Quarterly Consolidated Financial Statements (Changes in accounting policies)" on page 10 of the attachments.

(4) Total number of issued and outstanding shares (common shares)

1)	Total number of issued and outstanding shares at the end of the period (including treasury shares):
	May 31, 2022:	29,372,774 shares
	February 28, 2022:	29,372,774 shares
2)	Total number of treasury shares at the end of the period
	May 31, 2022:	363,550 shares
	February 28, 2022:	363,550 shares
3) Average number of shares during the period:
	Three months ended May 31, 2022:	29,009,224 shares
	Three months ended May 31, 2021:	29,009,424 shares

• These quarterly consolidated financial results are outside the scope of a quarterly review by certified public accountants or an audit firm.
• Explanation of the proper use of financial results forecast and other notes
  Forward-looking statements contained in this document, including financial results forecast, are based on information currently available to the Company and certain assumptions that the Company considers reasonable, and actual financial results, etc. may significantly differ from the projections due to various factors. For the use of financial results forecast, please see "1. Qualitative Information on Quarterly Financial Results (3) Explanation of Consolidated Financial Results Forecast and Other Forecasts" on page 5 of the attachments.

Table of Contents - Attachments
1. Qualitative Information on Quarterly Financial Results .....................................................................	2
(1)	Explanation of Operating Results .................................................................................................	2
(2)	Explanation of Financial Position .................................................................................................	5
(3)	Explanation of Consolidated Financial Results Forecast and Other Forecasts .............................	5
2. Quarterly Consolidated Financial Statements and Principal Notes .......................................................	6
(1)	Quarterly Consolidated Balance Sheets .........................................................................................	6
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income ................................	8
	Quarterly Consolidated Statements of Income
	Three months ended May 31, 2022 ............................................................................................	8
	Quarterly Consolidated Statements of Comprehensive Income
	Three months ended May 31, 2022 ............................................................................................	9
(3)	Notes to Quarterly Consolidated Financial Statements ...............................................................	10
	(Notes on going concern assumption) ......................................................................................	10
	(Notes in case of significant changes in shareholders' equity) .................................................	10
	(Changes in accounting policies) ...............................................................................................	10
	(Notes to the Consolidated Statements of Income) ....................................................................	10
	(Segment information, etc.) ......................................................................................................	11
	(Revenue recognition) ..............................................................................................................	12

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1. Qualitative Information on Quarterly Financial Results

(1) Explanation of Operating Results

In the three months ended May 31, 2022, amid the prolonged impact of COVID-19, economic and social activities showed some signs of returning to normal due in part to progress in the roll-out of vaccines and the lifting of the targeted measures to prevent the further spread of the virus in all regions across Japan. However, factors such as the growing instability in the supply chain and rises in raw material prices, logistics costs, and utilities costs partly caused by the situation in Ukraine and lockdowns in China have contributed to the continued unpredictability of the future outlook.

Under these circumstances, we began concentrating management resources on Japan and Vietnam in this fiscal year with the aim of enhancing corporate value and achieving sustainable growth. In March, the Company transferred all the shares it held in MINISTOP Korea Co., Ltd., a consolidated subsidiary, and the subsidiary was excluded from the scope of consolidation from the beginning of the three months ended May 31, 2022. In addition, we competed the liquidation of QINGDAO MINISTOP CO., LTD, a consolidated subsidiary, in April. As a result, gross operating revenue decreased year on year. Operating loss, however, shrunk year on year as we cut expenses related to advertising, equipment, and others. In addition, we recorded a gain on sale of shares of subsidiaries and associates of ¥23,831 million as we completed the transfer of MINISTOP Korea Co., Ltd.

As a result of the above, consolidated operating results for the three months ended May 31, 2022 were gross operating revenue of ¥20,552 million (gross operating revenue of ¥46,508 million in the same period of the previous fiscal year), operating loss of ¥729 million (operating loss of ¥1,877 million in the same period of the previous fiscal year), ordinary loss of ¥546 million (ordinary loss of ¥1,742 million in the same period of the previous fiscal year), and profit attributable to owners of parent of ¥14,253 million (loss attributable to owners of parent of ¥1,849 million in the same period of the previous fiscal year).

The Group has applied the "Accounting Standard for Revenue Recognition" (Accounting Standards Board of Japan (ASBJ) Statement No. 29, March 31, 2020), etc. from the beginning of the first quarter of the fiscal year under review. As a result, the way we record gross operating revenue is different from the way we recorded it in the three months ended May 31, 2021, and therefore, the amount of change and the rate of year-on-year change

1. in gross operating revenue are not stated in the Explanation of Operating Results section. For more details, please refer to "2. Quarterly Consolidated Financial Statements and Principal Notes (3) Notes to Quarterly Consolidated Financial Statements (Changes in accounting policies)."

The operating results of each segment are as follows.

[Domestic business]

Net sales at all stores of MINISTOP alone compared with the same period of the previous fiscal year decreased by 1.7%. Net sales per day per existing store compared with the same period of the previous fiscal year ("per-day/per-store sales") for MINISTOP stores decreased by 0.6%. Per-day/per-store sales of convenience store products decreased by 1.5%, and per-day/per-store sales of fast food products processed in store increased by 5.4%. Average per-day/per-store customer numbers fell by 2.6%, while per-day/per-store average customer purchase value increased by 2.1%. While the number of customers decreased year on year due in part to a rebound from the impact of such factors as the TV commercials broadcast last year, the customer purchase value for fast food products processed in store increased year on year in terms of both unit price per product and the number of products purchased.

Our mission is 'We realize a society full of beaming smiles with "delicious" and "convenience," and our vision is "creating stores that are more convenient, more healthy, more exciting, that customers will want to visit every day." Under the policy of establishing "meal destination stores" where consumers would go to purchase their meals every day, we expanded our product design and offerings that are filled with a sense of "freshly cooked" and excitement and promoted various initiatives to save customers' time. We strove to make our stores more convenient by, for example, reviewing the methods of processing and delivering fast food products

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