S Foods : Summary of Consolidated Financial Results for the Second Quarter

Note: This document is a translation of a part of the original Japanese version and provided for reference purposes only. In the event of any discrepancy between the Japanese original and this English translation, the Japanese original shall prevail.

Consolidated Financial Results

for the Six Months Ended August 31, 2023

[Japanese GAAP]

Company name: S Foods Inc.	October 12, 2023
Stock exchange listing: Tokyo
Code number: 2292
URL: https://www.sfoods.co.jp
Representative: Shinnosuke Murakami	President and Representative Director
Contact: Kenji Unoki	Corporate Officer Supervising Administration Group

Phone: +81-798(43)1065

Scheduled date of filing quarterly securities report: October 13, 2023

Scheduled date of commencing dividend payments: October 31, 2023

Availability of supplementary briefing material on quarterly financial results: No

Schedule of quarterly financial results briefing session: No

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

1. Consolidated Financial Results for the Six Months Ended August 31, 2023 (March 1, 2023 to August 31, 2023)

(1) Consolidated Operating Results			(% indicates changes from the previous corresponding period.)
	Net sales		Operating profit	Ordinary profit	Profit attributable to
		owners of parent
Six months ended	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%
August 31, 2023	208,986		7.8	8,333	(3.0)	9,426	(2.9)	7,166	25.2
August 31, 2022	193,827		13.8	8,587	6.5	9,704	15.0	5,726	2.4

(Note) Comprehensive income:	Six months ended August 31, 2023:
	Six months ended August 31, 2022:

¥	11,952 million	[	34.2%]
¥	8,908 million	[	30.0%]

	Basic earnings	Diluted earnings per
	per share		share
Six months ended	Yen			Yen
August 31, 2023	226.61			-
August 31, 2022	181.10			-
(2) Consolidated Financial Position
	Total assets		Net assets	Capital adequacy ratio
As of	Millions of yen		Millions of yen	%
August 31, 2023	221,919			126,619	53.7
February 28, 2023	204,778			117,306	53.8
(Reference) Equity: As of	August 31, 2023:	¥	119,162 million
As of	February 28, 2023:	¥	110,092 million

2. Dividends

				Annual dividends
	1st	2nd		3rd		Year-end	Total
	quarter-end	quarter-end		quarter-end
	Yen		Yen		Yen		Yen	Yen
Fiscal year ended February 28, 2023	-		39.00		-		39.00	78.00
Fiscal year ending February 29, 2024	-		42.00
Fiscal year ending February 29, 2024					-		42.00	84.00
(Forecast)
(Note) Revision to the forecast for dividends	announced most	recently:	No

3. Consolidated Financial Results Forecast for the Fiscal Year Ending February 29, 2024(March 1, 2023 to February 29, 2024) (% indicates changes from the previous corresponding period.)

			Net sales		Operating profit	Ordinary profit	Profit attributable to	Basic earnings
				owners of parent	per share
			Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
Full year			420,000		5.2	13,500	(7.4)	14,000	(11.6)	10,000	(5.4)	316.09
(Note) Revision to the financial results forecast announced most recently:	No
* Notes:
(1) Changes in significant subsidiaries during the six months ended August 31, 2023
(changes in specified subsidiaries resulting in changes in scope of consolidation):	No
New	-	(Company name:								)
Exclusion:	-	(Company name:								)

1. Accounting policies adopted specially for the preparation of quarterly consolidated financial statements:Yes
2. Changes in accounting policies, changes in accounting estimates and retrospective restatement
3. 1. Changes in accounting policies due to the revision of accounting standards: No
   2. Changes in accounting policies other than 1) above: No
   3. Changes in accounting estimates: No
   4. Retrospective restatement: No
4. Total number of issued shares (common shares)
5. 1. Total number of issued shares at the end of the period (including treasury shares):

August 31, 2023:	32,267,721	shares
February 28, 2023:	32,267,721	shares
2) Number of treasury shares at the end of the period:
August 31, 2023:	631,489	shares
February 28, 2023:	646,640	shares

3) Average number of shares outstanding during the period:
Six months ended August 31, 2023:	31,626,854	shares
Six months ended August 31, 2022:	31,617,296	shares

Quarterly Consolidated Financial Statements

Quarterly Consolidated Balance Sheets

		(Millions of yen)
	As of February 28, 2023	As of August 31, 2023
Assets
Current assets
Cash and deposits	46,862	39,200
Notes and accounts receivable - trade	35,212	44,361
Merchandise and finished goods	28,304	32,641
Work in process	2,049	8,697
Raw materials and supplies	5,644	6,253
Other	9,778	5,726
Allowance for doubtful accounts	(48)	(62)
Total current assets	127,803	136,817
Non-current assets
Property, plant and equipment
Buildings and structures	60,419	60,752
Accumulated depreciation	(29,822)	(30,138)
Buildings and structures, net	30,597	30,614
Land	14,989	14,937
Other	44,843	49,347
Accumulated depreciation	(27,550)	(28,789)
Other, net	17,293	20,558
Accumulated impairment	(3,796)	(2,672)
Total property, plant and equipment	59,084	63,437
Intangible assets
Goodwill	197	166
Other	389	347
Total intangible assets	586	514
Investments and other assets
Investment securities	13,920	16,036
Retirement benefit asset	180	192
Other	3,391	5,107
Allowance for doubtful accounts	(188)	(186)
Total investments and other assets	17,304	21,150
Total non-current assets	76,974	85,101
Total assets	204,778	221,919

		(Millions of yen)
	As of February 28, 2023	As of August 31, 2023
Liabilities
Current liabilities
Notes and accounts payable - trade	26,964	28,148
Short-term borrowings	12,275	11,580
Income taxes payable	2,792	2,940
Provision for bonuses	1,083	1,310
Other	12,457	14,994
Total current liabilities	55,572	58,973
Non-current liabilities
Bonds payable	350	300
Long-term borrowings	26,971	30,156
Provision for retirement benefits for directors (and	140	118
other officers)
Retirement benefit liability	2,035	2,022
Other	2,401	3,729
Total non-current liabilities	31,899	36,326
Total liabilities	87,472	95,300
Net assets
Shareholders' equity
Share capital	4,298	4,298
Capital surplus	18,754	18,792
Retained earnings	80,861	85,416
Treasury shares	(407)	(397)
Total shareholders' equity	103,507	108,110
Accumulated other comprehensive income
Valuation difference on available-for-sale	3,332	4,939
securities
Deferred gains or losses on hedges	(61)	80
Foreign currency translation adjustment	3,362	6,075
Remeasurements of defined benefit plans	(47)	(44)
Total accumulated other comprehensive income	6,585	11,051
Non-controlling interests	7,213	7,457
Total net assets	117,306	126,619
Total liabilities and net assets	204,778	221,919

Quarterly Consolidated Statements of Income and Comprehensive Income

Quarterly Consolidated Statements of Income (For the six months)

		(Millions of yen)
	For the six months	For the six months
	ended August 31, 2022	ended August 31, 2023
Net sales	193,827	208,986
Cost of sales	166,484	181,036
Gross profit	27,342	27,949
Selling, general and administrative expenses	18,754	19,616
Operating profit	8,587	8,333
Non-operating income
Interest income	83	199
Dividend income	329	345
Rental income from buildings	109	75
Share of profit of entities accounted for using equity	5	1
method
Foreign exchange gains	414	428
Other	381	423
Total non-operating income	1,324	1,473
Non-operating expenses
Interest expenses	138	151
Arrangement fee	-	100
Rent cost	24	20
Other	44	108
Total non-operating expenses	207	380
Ordinary profit	9,704	9,426
Extraordinary income
Gain on sale of non-current assets	14	52
Gain on sale of shares of subsidiaries and associates	-	1,388
Gain on sale of investment securities	-	4
Subsidy income	210	1,584
Total extraordinary income	224	3,028
Extraordinary losses
Loss on disposal of non-current assets	78	24
Impairment losses	68	21
Loss on store closings	0	1
Loss temporary store closings	39	-
Loss on tax purpose reduction entry of non-current	50	1,583
assets
Loss on sale of investment securities	-	4
Loss on valuation of investment securities	-	374
Other	1	-
Total extraordinary losses	239	2,010
Profit before income taxes	9,689	10,444
Income taxes	3,764	2,979
Profit	5,925	7,465
Profit attributable to non-controlling interests	199	298
Profit attributable to owners of parent	5,726	7,166