2024-2027 Medium-Term Management Plan
Briefing Materials for Investors

May 10, 2024
RENAISSANCE INCORPORATED0Table of Contents
1. 2024-2027 Medium-Term Management Plan Overview-1) Background to the Medium-Term Management Plan and Changes in theManagement Indicators-2) Medium-Term Management Plan Overview/Renaissance‘s Business Development/
Our Understanding of the Market

2. Direction for Strengthening Business and Organizational Foundations-1) Business Direction (Sports Clubs and Peripheral Areas/Nursing and Medical Care Peripheral
Areas/Home Fitness)-2) Direction for Strengthening Organizational Foundations (HR/IT/Finance)
3. Management Goals and Cash Allocation/Corporate Philosophy and Long-TermVision11. Background to the Medium-Term Management Plan
Changes in the management indicators
COVID-19 is already becoming a thing of the past. With the consolidation/merger of Sports Oasis,
the Company is poised to become No. 1 in the fitness industry in terms of sales. It is now at aturning point as it heads full steam toward a growth trajectory.
Net Sales and Operating Income (Billions of Yen)
 Sudden change from stable growth until FY2017
 Changing competitive landscape in the fitness industry, then struck by COVID-19 pandemic Earnings recovery, a work in progress50

 Kept at about 40% before the pandemic,
maintaining soundness Strategically aggressive era, financial strength
temporarily decreased; continued to balancesoundness and investment
50403020100403020

ROE (%)

Shareholders' equity ratio (%)

 Temporary deterioration in FY2020 due tochanges in the competitive environment and thepandemic Aiming for improvement with earnings recovery as
a key driver40
200-20-40-60-80

100FY2017

FY2018FY2019FY2020

FY2021

FY2022-10Sales (Billions of yen)

Operating income (Billions of yen)

FY2023The shareholders' equity ratio has fallen temporarily due
to the acquisition of Oasis shares. Further strengtheningof finances is needed.
21. Medium-Term Management Plan Overview
Corporate
Philosophy
Long-Term
VisionRENAISSANCE, "a company for creating purpose in life (ikigai in Japanese)," proposes a healthy and comfortable lifestyle
to our guests.
Health solution company that enriches the age of the 100-year life span

Social changes to be resolved

Four societies we aim forRevealing health issues

A society in which all generations can live
healthy and comfortable lives

Discrepancy between average
life expectancy and healthy
life expectancy

A healthy and long-lived society full ofvitality through exercise and humaninteraction

Lack of rehabilitation andother services

Realization of a society in which everyone, eventhose with illnesses or those who need support
such as nursing care, can live a life and lead alife that is uniquely their own

Decline of local
communities

A society where people can actively
participate in their local communities

Direction of the Medium-Term
Management Plan

1

Driving the industry as a leading
integrated sports club company

 Pursuit of added value unique to an integrated sports club
 Strengthen earnings base through efficient store
operations
 Drive industry restructuring through aggressive
M&A/succession
 Expansion of peripheral businesses through leveraging ofoperational know-how

2

Creating medium- to long-term growth
drivers beyond the fitness industry

 Nursing and medical care peripheral businesses focusedon functional improvement
 Home fitness business to expand the base of exercise
habits3

1. Overview of the Medium-term Management Plan
(Renaissance's Business Development)

Renaissance's business to support the health challenges of all generations
Age0 years old
Demographic
active inexercise forhealthmaintenance

100 years oldSports Club Business• A community health solution center for all ages,
from infants to the elderly

1

Driving the industry as a leading
integrated sports club company

Nursing and Medical Care-related BusinessSports Club Peripheral Business Domain

Demographic
not active in
exercise forhealthmaintenance• Utilize operational know-how gained from sports clubmanagement outside the facilities
Know-how gained outside the facilities is circulated back to thesports clubs└Regional health promotion projects andPPP projects└Health promotion business for workers• Day-care service for functional improvement and home nursingstations• Solution proposals for nursing care insurance providers

Home Fitness Business

2

Creation of medium- to long-term growth
drivers that transcend the boundaries ofthe fitness industry• Online sales proposing exercise habits
for life "outside the fitness market"

4

1. Medium-Term Management Plan Overview(Our Understanding of Market Size/Growth Potential and Competitive Environment)
Market size is Renaissance's estimate based on various data.

Fitness market

Nursing care-related services market
Nursing care-related services market(Approx 1 trillion yen)

Fitness market(Approx 450 billion yen)

Market size

Integrated fitness club market(Approx 280 billion yen)
Renaissance sales
from sports facilities(Approx 60 billion yen)

Marketgrowthpotential
Competitiveenvironment

Frailty-related market(Approx 130 billion yen)Nursing care tech market(Approx 70 billion yen)
Rehabilitation facilities market(Approx 300 billion yen)
Renaissance sales fromnursing care facilities(Approx 2 billion yen)

 Despite the advent of low-priced 24-hour unmanned clubs andthe spread of online services, fitness participation rates areincreasing only slightly
 Recent steady recovery in membership of integrated sports clubs

 With the increase in average life expectancy, the market for nursing care-related services isexpected to grow
 Among them, there are growing expectations for rehabilitation-specific day-care services
that aim to maintain and restore physical and lifestyle functions and find purpose in life
(ikigai in Japanese) Low-priced formats are pushing market development, while theappeal of integrated clubs is being reaffirmed.
 The number of operators running integrated clubs is gradually
becoming more limited, and consolidation by major players iscontinuing Highly difficult to stabilize earnings due to the impact of the triennial revision of nursing
care fees, etc.
 Possible to differentiate through effective physical and lifestyle function improvement
know-how5

2. Direction for Strengthening Business andOrganizational Foundations

Driving the industry as a leading
integrated sports club company

1(1) Sports Club BusinessStrengthening
the earnings
base andtransforming
the businessstructure

Increasing customer experience value by accompanying customers until
results materialize and making exercise a habit••

Increasing the efficiency of facility operations and reinvesting incustomer experience value••

Increased need to respond to changes in cost structure due to rising construction costs, utility
costs, and wages and to lower facility maintenance costs through facility maintenance andcleanliness, etc.
Promoting operational efficiency and creating customer interaction time through the use of DX

Sales target (Billions of yen)70504030•

10Strengthening the growth potential of Oasis by leveraging Renaissance know-how
Membership programs for companies (monthly corporate), swimming schools, etc.
Measures are based on the success stories of Renaissance/Oasis, shared between the twocompanies, and develop new know-how

59.3

60

Maximize synergies from Oasis integration•Business
succession
M&A

Reinforcing "human" services that lead to customer experience value, distinct from smallscale, unmanned formats
Setting prices appropriate for the customer experience value

39.3

200

FY2023

FY2027

Drive industry restructuring through aggressive M&A/succession•140 facilities nationwide through business succession and M&A (as of March 31, 2024)
32 Sports Oasis facilities cover the Tokyo metropolitan area and Kinki region
Achieved value enhancement of facilities (Imazato and KSC Kanamachi) where businesssuccession has been implemented*(Reference) Sales of Oasis in FY2023 were
12.1 billion yen (non-consolidated)6

2. Direction for Strengthening Business andOrganizational Foundations

1

Driving the industry as a leading
integrated sports club company(1) Rolling out know-how gained from sports club management to new marketsProviding solutions for health and education
issues faced by municipalities near clubs• Conducted more than 1,000 nursing prevention
classes for a cumulative total of more than 150
municipalities

BtoG
Community
healthpromotion

Entrusted management of public facilities
through PPP (entrusted management/PFI, etc.)• Expanding the market to include innovative proposals
and Park-PFI in collaboration with BEACH TOWN.
Sales target (Billions of yen)

5.5

64
20

1.6
FY2023

FY2027*(Reference) Sales of Oasis in FY2023
were 1.0 billion yen (non-consolidated)

BtoB
Healthpromotionfor workers
targetingcorporate
healthinsurance
associations

Market expansion through health content
cultivated in sports clubs and online
platforms to deploy this content•••

54,331 online members (as of March 31, 2024)
900 RENAISSANCE Online Livestream (ROL)
programs per week
More than 900 companies and health insurances
associations under corporate contract withRenaissance
Sales target (Billions of yen)

0.8

1.0

0.5

0.0

0.4

FY2023

FY20277

2. Direction for Strengthening Business andOrganizational Foundations

2

Creation of medium- to long-term
growth drivers that transcend theboundaries of the fitness industry(2) Nursing and medical care peripheral business
Monetizationof existing
facilities
New storeopenings
Promotion ofM&A

Stable profitability through track record in functional improvement• Stable operation of 33 directly managed facilities and 11 franchise facilities (as of March 31,2024)• Products backed by evidence such as functional training, additional acquisition of oral functions,and SYNAPSOLOGY®
• Each store is consistently well-attended and filled close to capacity

Establishing a model for multi-store development• Establish model stores that can respond to the nursing care industry's shortage of humanresources and periodic revisions to the nursing care reimbursement system, while taking
advantage of the Renaissance's unique characteristics• Aggressive investment in new store openings and M&A promotion to cover all aspects of thearea

Sales target (Billions of yen)

4.0

3.5

3.5
3.0
2.5
2.0

1.9

1.5
1.0

Proposal ofnursing caresolutions

Propose know-how gained through our own operations to otherbusiness operators• Strengthen sales structure to make proposals that contribute to the profitability of day-carefacilities operated by other business operators

0.50.0

FY2023

FY202782. Direction for Strengthening Business andOrganizational Foundations(3) Home Fitness Business

2Creation of medium- to long-term
growth drivers that transcend theboundaries of the fitness industry

I don't like exercise. I can't keep upwith exercise.
In that case, I don't need to go to agym.
Working out while having fun as myauthentic self.
A better mind and body foreveryone, all the time.

Sales target (Billions of yen)
4.6

5.0Fitness toys supervised by exercise professionals•Originalproductdevelopment

•4.5
4.0

Development of products that enable people who don't like exercise or have low
physical fitness to develop exercise habits at home, and that fit into their lives evenwhen they do not exercise
Home exercise equipment that allows you to exercise while doing something else.

3.5

The concept is "bring the sports club to the home"
Exercise equipment invented by gym trainers allows you to exercise while doing
something else.
Easy, simple, and yet solidly effective

1.5

3.0
2.5
2.0

1.0
0.5

0.16

0.0

FY2023

Diversesaleschannels

Sales of "just right" products that meet the needs of those withpotential health issues•

Marketing and sales promotion expenditures with clear targeting based on TVshopping and Internet shopping results

FY2027* (Reference) Sales of Oasis in FY2023 were 3.9billion yen (non-consolidated)92. Direction for Strengthening Business andOrganizational Foundations
Three pillars for strengthening organizational foundations
Optimizing management resource allocation from a Company-wide growth perspectiveAims•HRITFinance••••••

Linking management and business strategies
with human resources strategies
Solidifying position as a leading company in
Health and Productivity Management
Achieving diversity in management(30% female managers)
Realization of an experience chosen bycustomers and staff through human x digital
Build infrastructure linked to business strategy

Actions to achieve management conscious of
the cost of capital and stock price
Shareholders' equity ratio 25.0%/ROE
12.0%/ROIC 7.7%

Key points•
•
•
•
••
•

Investment in human capital to improve productivity over medium tolong term
Realization of management according to business and functional
characteristics
Emphasize ensuring diversity and fairness as a source of innovation
Build an internal and external system integration infrastructure that canflexibly respond to business needs from a long-term perspective ofabout 10 years and overall optimization.
System development/organization required for management/skill
development and securing talent

Clarification of investment and exit criteria
Carry out capital expenditures within the scope of operating
cash flows

103. Management Goals
Management Goals in the Medium-Term Management Plan (Financial Goals)
Indicator

FY2023 results

FY2027 target

2023 versus 2027

Net sales43.6 billion yen

75.0 billion yen+31.4 billion yen (172%)

Operating income

1.26 billion yen

5.5 billion yen+4.24 billion yen (443%)

Operating income to netsales

2.8%

7.3%

+4.5ptShareholders' equity ratio

21.5%

25.0%

+3.5ptROE

5.7%

12.0%+6.3pt

ROIC

2.4%

7.7%

+5.3pt11

3. Management Goals
Growth plan for operating income (FY2023 to FY2027 breakdown) (Billions of yen)
Strengthening theopening of nursing careand rehabilitation
facilities

121.1
100.8

Impact of Oasis
integration

Investment in humancapital to improve
productivity

0.3

7.2

Build infrastructure linked
to business strategy

8Expansion of BtoG (regional)
and BtoB (occupational area)

(2.9)

(0.3)

6(0.4)

5.5(1.5)

420

Revenue from existing clubs +5.3 billion yen└Sales return to pre-COVID level└Total enrollment projected to be 400,000
Oasis integration impact +1.0 billion yen
New store openings, business succession, M&A +0.8 billion yen

1.3

Operating
Income for
Fiscal 2023

Sports club

Sports club
peripheral areas

Nursing careand medicalperipheralareas

Home fitnessInvestment in
humanresources

Investment insystems

Costs incurred for Oasis
integration

PMI
expenses

Other generaladministrative
expenses

Operating
Income for
Fiscal 2027

12

3. Management Goals
Management Goals in the Medium-Term Management Plan (Non-Financial Goals)

In our Sustainability Policy, we clearly state that we will "contribute to the creating purpose in life (ikigai inJapanese) for all stakeholders through our business activities“.
Contribute to customers'
creation of purpose in life(ikigai in Japanese) throughour business activities Number of social participants with a foundation in health(number of people creating purpose in life)
 Customer satisfaction survey (quality of purpose in life)

Achieve medium- tolong-term growththrough diverse humanresources
 Ensure diversity in the appointment of core personnel, etc.
30% female manager rate/100% acquisition rate of men’s child-care leave Health promotion of employees
100% of employees receive periodic health checkups/100% of employees
take follow-up measures after periodic health checkups
 Employee engagement survey

Expansion ofsports clubs

Online service toexpand healthimprovements

Supporting healthpromotion atcompanies andhealth insurance
associations

Expansion of nursing
and rehabilitation
facilities

Health promotion
support for local
municipalities

Business creationin the healthcare
domainConsulting forstore operations
and development
supportExpansion of
global businessCo-create projects withpartner companies andlocal governments
 Establish and comply with multi-stakeholder policy and partnershipbuilding declaration
 Contribute to national policies to extend healthy life expectancy
through government committees and related organization activities Partnering with municipalities to create healthy communities

133. Cash Allocation
Investment allocation policy and shareholder return policy

Investment
allocation policy

Advance and prioritize growthinvestments to improve
corporate value.
Flexibly respond while balancing
the strengthening of our financial
position and the provision of
stable returns to shareholders.

Investment in growth toimprove corporate value

14 billion yen
Cash flows
fromoperatingactivities

22 billion yen

Shareholder
return policy

Provide stable returns toshareholders, focusing on
dividends reflecting businessresults.

4-yearcumulative

Stableshareholder returnsShare buybacks

4 billion yen

Strengthening
financial position

4 billion yen
14

3. Renaissance Corporate Philosophy and Long-Term
VisionAiming to achieve record profits in
FY2027 by "creating purpose in life"(ikigai in Japanese) and making social
contributions to healthy living
2027

2029
50th

anniversary ofestablishment

Contribute to a well-being society as ahealth solutions company

2028

Aiming to achieve record profits

Sales 75 billion yen
Operating income
5.5 billion yen

2026

Resume sports club openings, allocate management resources for medium andlong term, and prepare for accelerated business growth202520242023

The addition of Tokyu Sports Oasis and KSC wellness Fitness Club Kanamachi andKanamachi Swimming Club will redefine the value of integrated sports clubs andincrease the contribution of healthcare-related businesses to overall performance.

Reinvest funds from sports club price revision into future growth areas, preparing for earnings recovery
Identify social issues to be addressed by our company

15

Corporate Philosophy
RENAISSANCE, "a company for creating purpose in life
(ikigai in Japanese)," proposes a healthy and comfortable
lifestyle to our guests.
Long-Term Vision
Health solution company that enriches the age of the
100-year life span
We will contribute to solving society's physical, mental and social healthissues through our business activities toward the realization of ahealthy and long-lived society.

16