Supplementary Material for

FY2023 Q2 Financial Results

June 13, 2023

◤◤ Contents

⚫

Consolidated Financial Highlights

2

⚫

Gyomu Super Business

4

⚫ Outline of Gyomu Super Franchise Agreement

5

⚫ Changes in Total Number of Gyomu Super Stores

6

⚫ Year-on-year Changes in Product Shipments to Gyomu Super Stores

7

⚫ Kobe Bussan's Strengths: "Unique Products with Competitive Advantages"

8

⚫

Restaurant & Delicatessen Business

9

⚫ Eco Renewable Energy Business

13

⚫

Shareholder Returns

15

⚫

Consolidated Financial Forecast

16

1

◤◤ Consolidated Financial Highlights

Net Sales

250,000

200,000

150,000

221,968

100,000

198,161

176,069

176,437

144,520

50,000

0

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Gross Profit

30,000

20.0%

15.9%

15.4%

16.0%

25,000

12.2%

12.0%

11.0%

12.0%

20,000

22,959

27,089

23,722

24,518

8.0%

15,000

21,572

4.0%

10,000

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Gross profit

Gross margin

SG&A Expenses

15,000

9.4%

10.0%

8.3%

12,000

8.0%

9,000

13,635

14,696

4.1%

4.5%

4.7%

6.0%

6,000

4.0%

8,989

10,384

3,000

7,184

2.0%

0

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

SG&A expenses

SG&A ratio

Operating Profit

15,000

10.0%

8.2%

7.4%

12,000

7.0%

8.0%

6.5%

6.4%

9,000

6.0%

12,393

14,387

14,733

14,133

6,000

4.0%

9,324

3,000

2.0%

0

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Operating profit

Operating margin

Note: Fiscal year (FY) represents the one-year period from November 1 to October 31 of the following year.

2

◤◤ Consolidated Financial Highlights

Ordinary Profit

18,000

12.0%

15,000

8.6%

8.3%

10.0%

12,000

6.6%

7.1%

8.0%

5.9%

9,000

6.0%

15,190

16,380

6,000

12,465

13,198

4.0%

9,487

3,000

2.0%

0

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Ordinary profit

Ordinary margin

Profit Attributable to

12,000

Owners of Parent

8.0%

9,000

5.7%

5.6%

6.0%

6,000

4.2%

4.3%

4.1%

4.0%

10,133

11,037

9,110

7,546

3,000

6,049

2.0%

0

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Profit attributable to owners of parent

Net margin

[Financial Overview]

  • Net sales
    Net sales increased by ¥23,807 million (12.0%) year on year with robust new store openings and continued strong product shipments to existing stores.
  • Gross profit
    Gross profit increased by ¥795 million (3.4%) year on year due to the yen being weaker and raw material prices being higher than a year ago despite the continued strong net sales.
  • SG&A expenses
    SG&A expenses increased by ¥1,395 million (15.5%) year on year due to increases in freight costs for the Gyomu Super Business and personnel and rent expenses resulting from the opening of our directly operated BBQ restaurants.
  • Operating profit
    As a result of the factors above, operating profit decreased by ¥599 million (4.1%) year on year
  • Ordinary profit
    Ordinary profit decreased by ¥3,182 million (19.4%) year on year due to the recording of a foreign exchange loss on U.S. dollar-denominated deposits and a valuation loss on forward exchange contracts resulting from the ongoing appreciation of the yen since the beginning of Q1. While the valuation loss varies depending on the exchange rates at quarter-end, we expect the loss to be reversed by the end of FY2023.
  • Profit attributable to owners of parent
    As a result of the factors above, profit attributable to owners of parent decreased by ¥1,927 million (17.5%) year on year.

3

◤◤ Gyomu Super Business

Gyomu Super is our core business. Operating results of this business segment reflect wholesale sales to, and royalty fee from, Gyomu Super franchisees earned by Kobe Bussan, a franchisor (franchising headquarters), as well as earnings of Kobe Bussan Group's plants.

  • Gyomu Super stores have expanded nationwide with 1,023 stores as of April 30, 2023.
  • Net sales for FY2023 Q2 exceeded the planned amount.
  • We have changed specifications of private label items produced by our group's domestic plants and revised prices for national brand items to address continuously rising costs caused primarily by the soaring prices of raw materials.

Gyomu Super Hakodate Taya Store (Our 1000th store)

Net Sales

(cumulative)

250,000

200,000

150,000

215,111

100,000

126,760

157,586

173,596

193,532

50,000

0

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Operating Profit

(cumulative)

20,000

9.2%

10.0%

7.8%

8.4%

8.6%

7.4%

16,000

8.0%

12,000

6.0%

16,620

8,000

13,300

16,052

15,822

4.0%

4,000

9,928

2.0%

0

0.0%

FY19 Q2

FY20 Q2

FY21 Q2

FY22 Q2

FY23 Q2

Operating profit

Operating margin

Note: Due to a change in the reportable segment structure in FY2021, the figures for FY2020 are reclassified retrospectively to reflect the change.

4

Accordingly, the figures for these four years are not consistent with that for FY2019.

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Kobe Bussan Co. Ltd. published this content on 13 June 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 13 June 2023 07:17:06 UTC.