Summary of Financial Results for the First Quarter of Fiscal Year 2022
(Three Months Ended March 31, 2022)[Japanese GAAP]May 13, 2022

Company name: SENSHUKAI CO.,LTD.

Stock exchange: Tokyo Stock Exchange
Stock code:
8165
URL: https://www.senshukai.co.jp
Representative:
Mr. Kenji Kajiwara, President and Representative Director
Inquiries:
Mr. Tetsuya Takahashi, Director, General Manager, Corporates Headquarters
Tel: +81-6-6881-3220
Scheduled date of filing of Quarterly Report: May 16, 2022
Scheduled date of payment of dividend: Preparation of supplementary materials for quarterly financial results: None
Holding of quarterly financial results meeting: None
(All amounts are rounded down to the nearest millions of yen)

1. Consolidated Financial Results for the 1st Quarter of 2022 (January 1, 202 2 – March 31, 2022)(1) Consolidated operating results (cumulative)(Percentages represent changes from the same period of the previous fiscal year)
Profit attributable toOperating profit
Ordinary profit
owners of parent

Net sales

Millions of yen%

1Q 2022
12,009(2,794)
1Q 202118,655(6.0)(388)
Note: Comprehensive income (millions of yen) 1Q 2022: (2,590) (-%)

Millions of yen%-

Millions of yen%

Millions of yen%(2,727)(373)
1Q 2021: 89 (-%)

(2,728)(290)-

Net income per share

Diluted net income per share

Yen

Yen

1Q 2022(58.20)
1Q 2021(6.32)
Note: Beginning with the first quarter of 2022, Senshukai has applied Accounting Standard for Revenue Recognition ( AccountingStandards Board of Japan (ASBJ) Statement No. 29, March 31, 2020). All figures for the first quarter of 2022 incorporate
this accounting standard and comparisons with the first quarter of the previous fiscal year are omitted.

(2) Consolidated financial position
Total assets

Net assets

Millions of yen

Equity ratio

Millions of yen

Net assets per share%Yen

1Q 2022
48,67330,41862.5
648.76
Fiscal Year 2021
52,47633,20263.3
708.09Reference: Shareholders’ equity (millions of yen) 1Q 2022: 30,418
Fiscal Year 2021: 33,202
Note: Beginning with the first quarter of 2022, Senshukai has applied Accounting Standard for Revenue Recognition (ASBJ
Statement No. 29, March 31, 2020). All figures for the first quarter of 2022 incorporate this accounting standard.

2. Dividends
1Q-endDividend per share
3Q-end2Q-endYen

Yen

Year-end

Yen

Total
Yen

Yen

Fiscal Year 2021
3.00
4.00
7.00
Fiscal Year 2022
Fiscal Year 2022 (forecasts)
0.00
0.00
0.00
Note: Revision to the most recently announced dividend forecast: Yes
For more information, please refer to “Notice of Revisions to Consolidated Outlook and Dividends (Dividend Suspension)”(Japanese version only) that was announced today (May 13, 2022).

3. Consolidated Outlook for Fiscal Year 2022 (January 1, 2022 – December 31, 2022)
Net sales
Millions of yen(Percentages represent changes from the same period of the previous fiscal year)
Profit attributable to
Net income per
Operating profit
Ordinary profit
owners of parent
share% Millions of yen% Millions of yen% Millions of yen%

Yen

Full Year 2022
68,000 (7.0)(4,200) (4,100)(4,000)(85.31)
Note: Revision to the most recently announced consolidated outlook: Yes
For more information, please refer to “Notice of Revisions to Consolidated Outlook and Dividends (Dividend Suspension)”(Japanese version only) that was announced today (May 13, 2022).

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes inscope of consolidation): None
(2) Application of special accounting methods for presenting quarterly consolidated financial statements: Yes
Note: Please refer to “2. Quarterly Consolidated Financial Statements and Notes, (3) Notes to Quarterly Consolidated
Financial Statements (Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial
Statements)” on page 8 for further information.

(3) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others: Yes
2) Changes in accounting policies other than 1) above: None
3) Changes in accounting-based estimates: None
4) Restatements: None
Note: Please refer to “2. Quarterly Consolidated Financial Statements and Notes, (3) Notes to Quarterly Consolidated
Financial Statements (Changes in Accounting Policies)” on page 8 for further information.

(4) Number of shares outstanding (common shares)
1) Number of shares outstanding at the end of the period (including treasury shares)
1Q 2022:52,056,993 sharesFiscal Year 2021:

52,056,993 sharesFiscal Year 2021:

5,167,335 shares

1Q 2021:45,905,333 shares

2) Number of treasury shares at the end of the period
1Q 2022:5,170,735 shares

3) Average number of shares outstanding during the period
1Q 2022:46,887,429 shares* This quarterly financial report is not subject to quarterly review by certified public accountants or auditing firms.
* Cautionary statement with respect to forward-looking statements
The above projections are based on information available at the time of release of thi s report. Actual results could differ
significantly from these projections due to a variety of factors. For further details regarding the projections, please refer to page3, “1. Qualitative Information on Quarterly Consolidated Financial Performance, (3) Explanation of Consolidated Forecasts andOther Forward-looking Statements.”

SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance2(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements

3

2. Quarterly Consolidated Financial Statements and Notes

4(1) Quarterly Consolidated Balance Sheet

4(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
Income6

Quarterly Consolidated Statement of Income(For the Three-month Period)

6

Quarterly Consolidated Statement of Comprehensive Income(For the Three-month Period)7(3) Notes to Quarterly Consolidated Financial Statements

8(Going Concern Assumption)

8(Significant Changes in Shareholders’ Equity)

8(Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements)

8(Changes in Accounting Policies)

8(Additional Information)

9(Segment Information)

10

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SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
Beginning with the first quarter of 2022, Senshukai has applied Accounting Standard for Revenue Recognition(ASBJ Statement No. 29, March 31, 2020). As a result, the explanation of results of operations for the first quarterof 2022 does not show the amount of increase or decrease compared with the same period of 2021.
In the first quarter (January 1 to March 31) of 2022, there were restrictions on economic activity in some areas ofJapan and consumer spending remained sluggish as the omicron variant sparked a rapid increase in COVID-19 cases.
Restrictions were eased by the end of March due to pandemic safety measures and progress with vaccinations.
However, the outlook for the economy is uncertain because the end of the pandemic is still not in sight and there areconcerns about the possibility of the appearance of a new variant. In addition, consumer sentiment in Japan is
declining because of growing geopolitical risk involving the Ukraine crisis and other events, the high price of crudeoil, rising U.S. interest rates, exchange rate volatility and the increasing cost of household necessities.
In Japan’s retail industry, competition became even more intense due to a growing number of new competitors in
the mail-order and online shopping business as e-commerce are firmly established as shopping channels amongcustomers. Furthermore, a full-scale recovery of Japan’s retail sector is unlikely to happen soon because of thedecline in demand linked to staying home for safety during the pandemic and the low level of consumer motivation
to make purchases.
In January 2022, the replacement of the core IT system was completed as planned. Replacement activities included
revisions and business process reengineering for systems and business processes that had b ecome complicated. The
purpose was to better enable Senshukai to adapt to a variety of changes in the business climate. Although a longtime and many measures were used to prepare for the new IT system, there were problems after the system became
operational. For example, some orders were not properly received and some merchandise could not be delivered onschedule. Furthermore, the impact of these problems broadened for several reasons, including a large volume ofcalls at the call center, and it became difficult to conduct normal business operations. The new system is currently
operating properly. However, sales at Belle Maison business in the core mail-order and online shopping businesshave been far below the level of the same period of 2021. Furthermore, first quarter sales in 2021 include sales ofthe bridal business, which was subsequently excluded from the consolidated financial statements. As a result, net
sales in the first quarter of 2022 were 12,009 million yen (compared with 18,655 million yen in the first quarter of2021), operating loss was 2,794 million yen (compared with a loss of 388 million yen in the first quarter of 2021),
ordinary loss was 2,727 million yen (compared with a loss of 373 million yen in the first quarter of 2021). Loss
attributable to owners of parent was 2,728 million yen (compared with a loss of 290 million yen in the first quarterof 2021).
Business segment performance was as follows.
Consolidated subsidiaries Dears Brain Inc. and PLANETWORK CO., LTD., and WONDERSTAGE Co., Ltd., awholly owned subsidiary of Dears Brain and a sub-subsidiary of Senshukai, were excluded from the scope of
consolidation following the sales of all shares of Dears Brain and PLANETWORK on March 31, 2021 . The Group
had withdrawn from these businesses. Consequently, there is no longer business segment information for the bridal
business beginning with the first quarter of 2022.
(Mail-order and Online Shopping Business)
Consolidated sales in the mail-order and online shopping business, which is primarily the catalog and the Internet
businesses, was 10,309 million yen in the first quarter of 2022 compared with 15,337 million yen in the first quarterof 2021. There was an operating loss of 2,879 million yen compared with a profit of 531 million yen in the firstquarter of 2021.
In the first quarter, there were problems involving the launch of the new core IT system following the completionof the replacement of the previous system in January 2022. To deal with these problems, marketing activities weresuspended and the level of normal business activities was reduced in order to focus on handling inquiries from
customers. Due to this situation, sales of Belle Maison in this segment were far below sales one year earlier, resulting
in lower segment sales and earnings.

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SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

(Corporates Business)
Consolidated sales in the corporates business, which provides products and services to corporations, were 1,131
million yen compared with 1,065 million yen in the first quarter of 2021. Operating profit was 55 million yen
compared with a profit of 109 million yen in the first quarter of 2021.
In the first quarter, as the omicron variant made the pandemic worse in Japan, sales increased because of strong salesof COVID-19 testing kits and other products involving the pandemic as people used them as novelties. Earnings
were lower because of the higher sales volume of products with a low gross margin.
(Insurance Business)
This business provides support, mainly to Belle Maison members, for choosing the most suitable insurance policies.
Consolidated sales were 87 million yen compared with 71 million yen in the first quarter of 2021 and operating
profit was 26 million yen compared with a profit of 13 million yen in the first quarter of 2021.
(Others)
Consolidated sales in other businesses, which include childcare support business and manufacturing and sales ofcosmetics, were 481 million yen compared with 447 million yen in the first quarter of 2021. Operating profit was 3
million yen compared with a profit of 3 million yen in the first quarter of 2021.
(2) Explanation of Financial Position(Balance sheet position)
Assets totaled 48,673 million yen at the end of the first quarter of 2022, a decrease of 3,803 million yen from theend of 2021.
Current assets decreased 3,926 million yen to 30,536 million yen. The factors included a decrease of 5,552 million
yen in cash and deposits, while there were increases of 1,194 million yen in merchandise and finished good s and477 million yen in other. Non-current assets increased 123 million yen to 18,136 million yen. The factors included
an increase of 318 million yen in intangible assets, while there were decreases of 82 million yen in property, plantand equipment and 111 million yen in investments and other assets.
Current liabilities decreased 964 million yen to 15,001 million yen. The factors included decreases of 1,559 million
yen in electronically recorded obligations-operating, 272 million yen in other and 220 million yen in provision forsales promotion expenses, while there were increases of 591 million yen in contract liabilities and 399 million yen
in accounts payable-trade. Non-current liabilities decreased 54 million yen to 3,253 million yen. The main factors
included a decrease of 105 million yen in long-term borrowings.
Net assets decreased 2,784 million yen to 30,418 million yen. The factors included booking of loss attributable toowners of parent of 2,728 million yen. As a result, the equity ratio was 62.5%.
(3) Explanation of Consolidated Forecasts and Other Forward-looking Statements
In response to problems that began after the January 2022 completion of the replacement of the core IT system,
Senshukai has suspended marketing activities and reduced the level of normal business activities in order to placepriority on handling inquiries from customers. Due to this situation, sales of Belle Maison in the core mail-orderand online shopping business were far below sales one year earlier. Currently, marketing activities have resumed,
the volume of business activities is increasing and there are new actions for achieving a sales recovery. The entire
Senshukai Group is firmly committed to restoring the trust of customers and achieving a recovery in the volume oforders. The forecast for 2022 reflects these issues and activities.
More information is in “Notice of Revisions to Consolidated Outlook and Dividends (Dividend Suspension)”(Japanese version only) that was announced on May 13, 2022.

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SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet(Millions of yen)

1Q 2022

Fiscal Year 2021
(As of Dec. 31, 2021)(As of Mar. 31, 2022)

AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade, and contract
assetsMerchandise and finished goods

15,665

10,113

2,235

2,541

9,123

10,317

Accounts receivable-other

5,654

5,264

Other

1,911

2,389

Allowance for doubtful accounts

(126)

(90)

34,46330,536

Buildings and structures, net

4,076

4,002

Land

5,524

5,524

379

370

9,980

9,897

Other

4,204

4,522

Total intangible assets

4,204

4,522

Investment securities

2,493

2,426

Other

Total current assets
Non-current assets
Property, plant and equipment

Other, net
Total property, plant and equipment
Intangible assets

Investments and other assets
1,425

1,380

Allowance for doubtful accounts

(90)

(90)

Total investments and other assets

3,828

3,716

18,013

18,13652,476

48,673

Total non-current assets
Total assets-4-

SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

(Millions of yen)

1Q 2022

Fiscal Year 2021
(As of Dec. 31, 2021)(As of Mar. 31, 2022)

Liabilities
Current liabilities
Electronically recorded obligations-operating

6,612

5,053

Accounts payable-trade

2,761

3,161

Short-term borrowings

550

500

Income taxes payable

22

10Contract liabilities
Provision for bonuses for directors (and otherofficers)
Provision for sales promotion expenses

-

591

6

-

258

38

Provision for bonuses

33

197

Other

5,721

5,449

Total current liabilities

15,96615,001

3,005

2,900

6

6

Non-current liabilities
Long-term borrowings
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities

296

347

3,307

3,253

19,274

18,255

Net assets
Shareholders’ equity
Share capital

100

100

Capital surplus

30,08430,084Retained earnings

7,061

4,139

Treasury shares(2,953)(2,953)

Total shareholders’ equity

34,291

31,370267

274

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges
Revaluation reserve for land
Foreign currency translation adjustment
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets

-5-

119

240

(1,516)(1,516)38

49(1,089)(952)

33,20230,41852,476

48,673SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

(2) Quarterly Consolidated Statement of Income and Quarterly Consolidated Statement of Comprehensive
Income(Quarterly Consolidated Statement of Income)(For the Three-month Period)
1Q 2021(Jan. 1, 2021 – Mar. 31, 2021)(Millions of yen)
1Q 2022(Jan. 1, 2022 – Mar. 31, 2022)

Net sales

18,65512,009

Cost of sales

9,268

6,384

Gross profit

9,386

5,625

Selling, general and administrative expenses

9,774

8,419

Operating loss

(388)

(2,794)Non-operating income
Interest and dividend income

60Gain on adjustment of account payable

19

39

Reversal of allowance for doubtful accounts

1

29

Other

224

57

Total non-operating income

252

127

Interest expenses

39

10

Rental expenses on real estate
Share of loss of entities accounted for using equity
methodCommission expenses

-

15

35

21

138

7

Non-operating expenses

Other

24

4

Total non-operating expenses

238

60

(373)

(2,727)0

4

Loss on sale of shares of subsidiaries and associates

9-

Loss on change in equity

26-

Total extraordinary losses

36

4

Loss before income taxes(409)(2,732)

Income taxes

(119)

(3)

Loss

(290)

(2,728)Loss attributable to owners of parent(290)(2,728)

Ordinary loss
Extraordinary losses
Loss on sale and retirement of non-current assets-6-

SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

(Quarterly Consolidated Statement of Comprehensive Income)(For the Three-month Period)
1Q 2021(Jan. 1, 2021 – Mar. 31, 2021)(Millions of yen)
1Q 2022(Jan. 1, 2022 – Mar. 31, 2022)(290)(2,728)Valuation difference on available-for-sale securities

73

6

Deferred gains or losses on hedges

213

120

Foreign currency translation adjustment
Share of other comprehensive income of entities
accounted for using equity method

(6)

3

99

6

379

137

89

(2,590)89(2,590)Loss
Other comprehensive income

Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners ofparent-7-

SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

(3) Notes to Quarterly Consolidated Financial Statements(Going Concern Assumption)
Not applicable.
(Significant Changes in Shareholders’ Equity)
Not applicable.
(Application of Special Accounting Methods for Presenting Quarterly Consolidated Financial Statements)(Calculation of tax expense)
Tax expenses are calculated by first determining a reasonable estimate of the effective tax rate after the applicationof tax effect accounting with respect to profit before income taxes for the fiscal year that includes the applicable
quarter and multiplying the profit before income taxes for that quarter by that rate. However, Senshukai uses
legally stipulated effective tax rates to calculate tax expenses when the use of estimated tax rates produces a clearly
irrational result.
(Changes in Accounting Policies)(Application of the Accounting Standards for Revenue Recognition)
Senshukai is applying the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31,2020) and other standards from the beginning of the first quarter of 2022. Based on these standards, revenue
expected to be received in exchange for the provision of goods and services is recognized when the control of thegoods and services is transferred to customers.
The main changes resulting from the application of the Accounting Standard for Revenue Recognition are as
follows:(1) Revenue recognition concerning the Senshukai Point Program
In prior years, Senshukai maintained a provision for sales promotion expenses based on the expected future use ofpoints that customers receive when they buy Senshukai merchandise in order to prepare for the use of these points.
Additions to this allowance were classified as selling, general and administrative expenses. In accordance with the
new revenue recognition standard, these points are now classified as a performance obligation and recog nition ofrevenue is deferred.
(2) Revenue recognition concerning point programs of other companies
In prior years, an amount equivalent to the value of the points of point programs operated by other companies wasclassified as selling, general and administrative expenses. In accordance with the new revenue recognition standard,
the calculation of transaction prices concerning merchandise sale performance obligations to customers now uses
the method of recognizing revenue after deducting transaction prices as the amount recovered for third parties.
(3) Revenue recognition concerning shipping expenses paid by customers
In prior years, shipping expenses received from customers were deducted from selling, general and administrative
expenses. In accordance with the new revenue recognition standard, payments from customers for shipping
expenses are now recognized as revenue because the merchandise shipping service is included in the performanceobligation involving the provision of merchandise to customers.
(4) Revenue recognition concerning sales of merchandise that may be returned
In prior years, for transactions of merchandise that may be returned, the value of merchandise returned bycustomers was deducted from sales when Senshukai confirmed the receipt of the merchandise. In accordance withthe provision of the new revenue recognition standard concerning variable compensation, revenue for merchandisethat is expected to be returned is not recognized when the merchandise is sold. Instead, a refund liability is now
recognized that is equivalent to the payment that was or will be received for the applicable merchandise.

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SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

For the application of the Accounting Standard for Revenue Recognition, in accordance with the transitional
measures in the proviso to Paragraph 84 of this standard, the cumulative effect of the retrospective application of
the new accounting standard, if it is applied prior to the first quarter of 2022, is added to or subtracted from retained
earnings at the beginning of the first quarter of 2022. The new standard is then applied beginning with this amountof retained earnings.
As a result, net sales increased 242 million yen and cost of sales decreased 10 million yen. Operating loss increased
42 million yen, and ordinary loss and loss before income taxes increased 52 million yen each. In addition, there
was a decrease of 5 million yen in retained earnings at the beginning of 2022.
Due to the application of the Accounting Standard for Revenue Recognition, “Notes and accounts receivable -trade”
that was presented in the current assets section of the consolidated balance sheet in 2021 is, from the first quarterof 2022, included in “Notes and accounts receivable-trade, and contract assets.” In addition, the amountcorresponding to contract liabilities in the revenue recognition standards, that was included in “Other” presented
in the current liabilities section in 2021 is, from the first quarter of 2022, stated as “Contract liabilities.” Inaccordance with the transitional treatment prescribed in Paragraph 89-2 of the Accounting Standard for Revenue
Recognition, no reclassification has been made to the prior year’s consolidated financial statements to conform to
the new presentation.
Application of the Accounting Standards for Measurement of Fair Value
Senshukai has applied the Accounting Standard for Measurement of Fair Value (ASBJ Statement No. 30, July 4,2019) and other standards from the beginning of the first quarter of 2022, and has applied the new accounting
policies set forth by the Accounting Standard for Measurement of Fair Value, etc. prospectively in accordance withthe transitional measures prescribed in Paragraph 19 of the Accounting Standard for Measurement of Fair Valueand Paragraph 44-2 of the Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019).
There is no effect of the application of these standards on the quarterly consolidated financial statements.
(Additional Information)(Application of tax effect accounting associated with the transition from the consolidated taxation system to thegroup tax sharing system)
Senshukai and its consolidated subsidiaries are transitioning to the group tax sharing system that was created by
the Act on Partial Amendments to the Income Tax Act, etc. (Act No. 8 of 2020) and, in conjunction with thistransition, has reexamined items concerning the non-consolidated taxation system. With respect to this transition
and reexamination, Senshukai and its consolidated subsidiaries have not used the provisions of Paragraph 44 of
Implementation Guidance on Tax Effect Accounting (Accounting Standards Board of Japan (ASBJ) Guidance No.
28, February 16, 2018) in accordance with the treatment in Paragraph 3 of Practical Solution on the Treatment of
Tax Effect Accounting for the Transition from the Consolidated Taxation System to the Group Tax Sharing System(ASBJ Practical Issues Task Force (PITF) No. 39, March 31, 2020). As a result, deferred tax assets and deferred
tax liabilities are based on the tax law prior to these amendments.
(Uncertainty of accounting estimates)
The COVID-19 pandemic had not ended as of the end of March 2022 and the outlook is uncertain, due in part toconcerns about the possibility of the appearance of a new variant. Furthermore, consumer sentiment in Japan is
declining because of growing geopolitical risk involving the Ukraine crisis and other events, the high price of
crude oil, rising U.S. interest rates, exchange rate volatility and the increasing cost of household necessities.
Senshukai assumes that these factors will have only a limited effect on accounting estimates. However, due toproblems involving the launch of the new core IT system in January 2022, marketing activities were suspended
and the level of normal business activities was reduced in order to focus on handling inquiries from cu stomers.
Due to this situation, sales of Belle Maison in the core mail-order and online shopping business were far below
sales one year earlier, resulting in lower segment sales and earnings. Currently, marketing activities have resumed,
the volume of business activities is increasing and there are new actions for achieving a sales recovery. The entire
Senshukai Group is firmly committed to restoring the trust of customers and achieving a recovery in the volumeof orders. Although Senshukai is using the best possible estimates based on information that is currently available,-9-SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

a change in the business climate or problems involving the new core IT system may have an effect on the financial
condition, results of operations and cash flows of the Senshukai Group.
(Segment Information)
I 1Q 2021 (Jan. 1, 2021 – Mar. 31, 2021)
1. Information related to sales and profit or loss for each reportable segment
Reportable segment
MailOthers
order and
Bridal Corporates Insurance
onlineSub-total (Note 1)
business businessbusiness
shopping
business

Total(Millions of yen)Amounts
shown onquarterly
Adjustment
consolidated(Note 2)statement ofincome(Note 3)

Net sales
Sales to customers 15,337
1,733
1,065
71
18,207447 18,655
18,655Inter-segment
65
5
10
81
81
(81)
sales or transfers
Total
15,402
1,738
1,076
71
18,289447 18,736(81)
18,655
Segment profit531(1,045)
109
13
(391)
3
(388)
0
(388)
(loss)
Notes: 1. Others represent the businesses which are not included in any of the four reportable segments and consist of thechildcare support business and manufacturing and sales of cosmetics.
2. The 0 million yen adjustment to segment profit (loss) is an elimination for inter-segment transactions.
3. Segment profit (loss) is adjusted to be consistent with the operating loss on the quarterly consolidated statement ofincome.

2. Information related to impairment of non-current assets, goodwill, etc. for each reportable segment
Significant changes in the amount of goodwill
In the bridal business, all shares of consolidated subsidiaries Dears Brain Inc. and PLANETWORK CO., LTD.
were sold at the end of the first quarter of 2021. As a result of the sales of these subsidiaries shares, goodwill
decreased 1,158 million yen.
3. Information related to assets for each reportable segment
Significant decrease in assets due to decrease in number of subsidiaries
Consolidated subsidiaries Dears Brain Inc. and PLANETWORK CO., LTD., and WONDERSTAGE Co., Ltd., awholly owned subsidiary of Dears Brain and a sub-subsidiary of Senshukai, were excluded from the scope of
consolidation following the sales of all shares of Dears Brain and PLANETWORK at the end of the first quarterof 2021. As a result, segment assets of the bridal business for the first quarter of 2021 decreased 14,911 million
yen, compared with the end of 2020.
II 1Q 2022 (Jan. 1, 2022 – Mar. 31, 2022)
1. Information related to sales and profit or loss for each reportable segment
Reportable segment
Mail-orderand online
shopping
business

Corporates
business

Insurancebusiness

Sub-total

Others(Note 1)

Total

(Millions of yen)Amounts
shown onquarterly
Adjustment consolidated
statement ofincome(Note 2)

Net sales
Sales to customers
10,3091,131
87
11,527481 12,009
12,009Inter-segment
55
8
64
64
(64)
sales or transfers
Total
10,365
1,140
87
11,592481 12,074(64)
12,009Segment profit(2,879)55
26(2,798)3(2,794)(2,794)(loss)
Notes: 1. Others represent the businesses which are not included in any of the four reportable segments and consist of thechildcare support business and manufacturing and sales of cosmetics.
2. Segment profit (loss) is adjusted to be consistent with the operating loss on the quarterly consolidated statement ofincome.

- 10 -SENSHUKAI CO.,LTD. (8165) Financial Results for the First Quarter of Fiscal Year 2022

2. Information related to revisions for reportable segments
In 2021, consolidated subsidiaries Dears Brain Inc. and PLANETWORK CO., LTD., and WONDERSTAGE Co.,
Ltd., a wholly owned subsidiary of Dears Brain and a sub-subsidiary of Senshukai, were excluded from the scopeof consolidation following the sales of all shares of Dears Brain and PLANETWORK. The Group had withdrawn
from these businesses. Consequently, there is no longer business segment information for the bridal businessbeginning with the first quarter of 2022.
(Application of the Accounting Standards for Revenue Recognition)
As described in Changes in Accounting Policies, Senshukai has applied the Accounting Standard for Revenue
Recognition (ASBJ Statement No. 29, March 31, 2020) from the beginning of the first quarter of 2022 and changed
the accounting method for revenue recognition. Accordingly, the method for calculating segment profit or loss
has been changed as well.
The effect of this change was to increase net sales by 249 million yen and to increase segment loss by 42 million
yen for the first quarter of 2022 in the mail-order and online shopping business. Net sales decreased 6 million
yen and there was no change in segment profit in other businesses.

* This financial report is solely a translation of summary of “Kessan Tanshin” (in Japanese, including attachments), which has
been prepared in accordance with accounting principles and practices generally accepted in Japan, for the convenience ofreaders who prefer an English translation.

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