HOME CENTER and HOME FASHION STORE

Financial Results Briefing Material
for the Six Months Ended September 30, 2023
(April 01, 2023 – September 30, 2023)

October 30, 2023
NAFCO Corporation(Securities Code: 2790)

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HOME CENTER and HOME FASHION STORE

Financial Results for the Six Months EndedSeptember 30, 2023
(April 01, 2023 – September 30, 2023)

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HOME CENTER and HOME FASHION STOREStatements of Income for the Six Months Ended September 30, 2023(Millions of yen)Six months ended
September 30, 2022

% of sales

Net sales

104,629100.0%

101,033

100.0%

96.6%

Gross profit

36,512

34.9%

34,021

33.7%

93.2%

Operating grossprofit

36,70135.1%

34,199

33.9%

93.2%

Selling, general andadministrative
expenses

30,07828.7%

30,16529.9%

100.3%

Operating profit

6,622

6.3%

4,033

4.0%

60.9%

Ordinary profit

6,831

6.5%

4,209

4.2%

61.6%

Profit

4,203

4.0%

2,487

2.5%

59.2%

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Six months ended
September 30, 2023% of sales

YoY Change

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HOME CENTER and HOME FASHION STORE

Balance Sheets(Millions of yen)
Fiscal Year Ended
March 31, 2023

Six months ended
September 30, 2023

Change From
the End of the Previous
Fiscal Year

Total assets

238,408

239,190+781

Current assets

105,748

106,540+792

36,12340,133+4,010132,660

132,649(10)

119,010

119,080+69

76,59475,637(957)

19,03318,808(224)

161,813

163,553+1,739Cash and deposit ratio (%)

15.2

15.8

Ratio of interest-bearing liabilities (%)

8.0

7.9

Equity ratio (%)

67.9

68.4

Current ratio (%)

167.3

172.3

Non-current ratio (%)

82.0

81.1

Of which, cash and deposits

Non-current assets
Of which, property, plant and equipment

Liabilities
Of which, interest-bearing liabilities（short-term borrowings, current portion oflong-term borrowings, long-term borrowings）

Net assets

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HOME CENTER and HOME FASHION STORE

Trends in Sales Composition by ProductMaterials, DIY andgardening goods

Six months
ended
September 2016

Six months
ended
September 2017

All Rights Copying NAFCO Co.,Ltd.

Six months
ended
September 2018

Householdgoods

Furniture and homefashion goods

OthersSix months
ended
September 2019

Six months
ended
September 2020

Six months
ended
September 2022

Six months
ended
September 2021

Six months
ended
September 2023

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HOME CENTER and HOME FASHION STORE

Trends in Existing Stores
Net sales of existing stores compared to previous year (%)

Six months ended
September 30, 2023 cumulative(existing stores)

Net sales︓96.5%
Customers︓93.0%
Customer average︓103.7%

Jul.

Aug.

Sep.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Jun.

Jul.

Aug.

Sep.

Sales
Customers
Customeraverage

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HOME CENTER and HOME FASHION STORE

Trends in Gross Profit Margin at the End of the Term
Left axis (gross profit margin: %）Right axis (private brand ratio: %）Six months ended
September 30, 2023

Gross profit margin

33.7%

(%)

FY3/13

FY3/14

FY3/15

FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21

FY3/22

FY3/23

Q2FY3/24

Private brandratio
Gross profit
marginAll Rights Copying NAFCO Co.,Ltd.

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HOME CENTER and HOME FASHION STORE

Factors for a Change in Operating Profit（Millions of yen）

Gross profit

Selling, general and administrative expenses(1,359)

(545)

6,622

(612)
Household
goods

＋25

(11)

OthersOperatingrevenue

Furniture and homefashion goods
Materials, DIY
and gardening goods
Six months ended September 30, 2022
Operating profit
All Rights Copying NAFCO Co.,Ltd.

(33)

Advertisingexpenses(256)

Personnel
expenses

+173

(39)

+69
OthersUtilityexpenses Depreciationand amortization

4,033

Six months ended September 30, 2023
Operating profit
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77HOME CENTER and HOME FASHION STORE

Trends in Private Brand Ratio at the End of the Term
Company total
Private Brand ratio(％)

Materials, DIY andgardening goods

Householdgoods

Furniture and home fashion goods

Ongoing

Increase

Aim toachieve
early

Fiscal year
ended
Mar. 2020
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Fiscal year
ended
Mar. 2021

Fiscal year
ended
Mar. 2022

Fiscal year
ended
Mar. 2023

Six months
endedSep. 2023

Full-year
targethttp://www.nafco.tv

88HOME CENTER and HOME FASHION STORE

Private Brand Products (Materials, DIY and Gardening goods)

Battery Chainsaw
Broad range of chainsaw users areshifting to battery types

Professional users

Engine chainsaw

Opting for battery types because

They are lighter than engine types and easier to start
They emit smaller noise and vibration, which reduces
physical burden on users

Non-professional

users

Cordedelectric chainsaw
Opting for battery types because

Battery types with no power cord
allows users to work over a larger aera

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HOME CENTER and HOME FASHION STORE

Private Brand Products (Household goods)

Loungewear and Slippers

Heat-generating slippers
Warm, fluffy boa fleece

Functional fabric insole

Many colors

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HOME CENTER and HOME FASHION STORE

Private Brand Products (Furniture and Home Fashion goods)

Kotatsu■Entirely original product series.
■Nordiska-series products for total coordination.
*The catalog below shows example coordinates[NAFCO’s e-commerce website “TWO-ONE STYLE” now featuring Kotatsu]
https://www.21style.co.jp/user_data/feature_2023_kotatsu_index.php
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HOME CENTER and HOME FASHION STOREStore Openings and Expansion/Renovation (New Stores)
Nogata Store
New
新店
StoresExpansion

改装Renovation/
増床

Store Name

Opening

Location

Store style

NogataJune

FukuokaHome center

Arie

July

NagasakiHome center(small store)

Ube(Furniture)

April

Yamaguchi

Furniture
house (TWOONE STYLE)

Washinomiya

May

SaitamaHome center

Arie StoreAll Rights Copying NAFCO Co.,Ltd.

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HOME CENTER and HOME FASHION STORE

Number of Stores by Area
KyushuChugoku
ShikokuKansai

Chubu

Kanto
Tohoku︓New stores in the fiscal year ending
March 31, 2024

全店

Total Stores

店
KansaiComposition ratio (no. of stores)by area (%)
エリア別店舗構成⽐（単位︓％）TohokuChugoku

Kanto
Chubu

KyushuAll Rights Copying NAFCO Co.,Ltd.

Shikoku

Small stores of1,000 m2

HI stand-alone
storesFurniture-onlystoresCombination
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HOME CENTER and HOME FASHION STORE

Business Growth Status
Furniture and home fashion goods

Build a product strategy
around the three cores andoperate stores making full useof each store format

8.8%■Sold at:
Combination stores, furniture only storesand home centers■Products
Furniture, floor coverings, curtains, interior
goods, lightings, bedding, remodelingmaterials, floor materials

19.6%

Sales inthe fiscal year
ended March 2023

Materials, DIY
and gardening goods

46.3%■Products
Carpentry tools, small metal building
components, paints, plastering supplies,
gardening goods, plumbing supplies, exteriormaterials, lumber, shelves, room accessories,
work supplies, plants, electrical materials202,259 million yen

Household goods■Sold at:
Combination stores, home centers and small
stores of about 1,000 m2■Products
Household goods, seasonal goods, storage
containers, stationery, daily goods, cooking
appliances, footwear, foods, cosmetics,
outdoor goods
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■Sold at:
Combination stores, home centers and small
stores of about 1,000 m2

25.3%
Store type

*Percentage figures represent
sales composition by productcategory

Composition
Ratio(no. ofStores)

Priority store opening pattern
Store area

Number ofpeople inservedbusiness area

Combination
store

39.4%

13,000 m2 or
more

200,000

Home center

50.3%

7,000 m2,10,000 m2 or
more

100,000

Furniture only
store

4.4%

7,000 m2

300,000

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HOME CENTER and HOME FASHION STORE

Number of Point Card Members(Ten thousand people)

Point card membership is increasing
through apps and cards(YoY Change +3.2%)

1,302
1,262
1,214
1,173

1,133
1,087
1,035976
2021
Reciprocal use of point
card on E-commercestarted903
829
747

2020
Integrated point card
into app2013
Changed from 3x points
plan to 5x points

Q2
FY3/14

Q2
FY3/15All Rights Copying NAFCO Co.,Ltd.

Q2
FY3/162019
Point card with inhouse money function

Q2
FY3/17

Q2
FY3/18Q2
FY3/19Q2
FY3/20Q2
FY3/21

Q2
FY3/22

Q2
FY3/23

Q2
FY3/24

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HOME CENTER and HOME FASHION STOREForecast for the Fiscal Year Ending
March 31, 2024
(April 01, 2023 – March 31, 2024)[Revision from information disclosed in April 2023: Included]

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HOME CENTER and HOME FASHION STOREForecast for the Fiscal Year Ending March 31, 2024
(Millions of yen)
YoYChange(%)

Fiscal year
ended
March 31, 2023
(Results)% ofsales

Fiscal year
ended
March 31, 2022
(Results)% ofsales

200,000 100.0% 98.9％

202,259

100.0%

206,549

100.0％

Full-year(Plan)Net sales% ofsales

Operatingprofit

7,000

3.5%

75.9％

9,219

4.6%

12,002

5.8%

Ordinary profit

7,425

3.7%

76.8％

9,760

4.8%

12,572

6.1%

Profit

4,120

2.1%

73.1％

5,639

2.8%

7,961

3.9%

Annualdividends

58 yen (forecast)56 yen

56 yenThe full-year forecast has been revised based on the results of the six months ended September 30, 2023.
(Announced on October 24, 2023)
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HOME CENTER and HOME FASHION STORE

Shareholder Benefit Program
Expansion from September 2023 was disclosed in the news release“Expansion of Shareholder Benefit Program” on August 18, 2023

Number of shares held

End of September (Interim)[Either A or B]

End of March (Year-end)[Either A or B]

100 or more
but less than 500 shares

A. UC Gift Voucher worth ¥500
B. NAFCO Shopping Voucher
worth ¥1,000

A. UC Gift Voucher worth ¥1,000
B. NAFCO Shopping Voucher
worth ¥2,000500 or more
but less than 1,000shares

A. UC Gift Voucher worth ¥1,500
B. NAFCO Shopping Voucher
worth ¥3,000

A. UC Gift Voucher worth ¥3,000
B. NAFCO Shopping Voucher
worth ¥6,000

1,000 or more shares

A. UC Gift Voucher worth ¥2,500
B. NAFCO Shopping Voucher
worth ¥5,000

A. UC Gift Voucher worth ¥5,000
B. NAFCO Shopping Voucher
worth ¥10,000*The red text indicates the latest expansion.

*NAFCO Shopping Voucher
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HOME CENTER and HOME FASHION STORE

Trends in the Number of Shareholders(People)[Nov. 08, 2019] Notice of Introduction of Shareholder Benefit Program[May 08, 2020] Notice of Dividends of Surplus (Increase)

11,121[Oct. 30, 2020] Notice of Expansion of Shareholder Benefit Program[Oct. 30, 2020] Notice of Dividends of Surplus (Interim Dividends and Increase)[Feb. 19, 2021] Notice of Revision from Year-End Dividend Forecast for
the Fiscal Year Ending March 31, 2021 (Increase)[Sep. 20, 2022] Expansion of Shareholder Benefit Program[Aug. 18, 2023] Notice of Expansion of Shareholder Benefit Program

8,103

Started theintroduction ofShareholder
Benefit Program

FY3/15

FY3/16All Rights Copying NAFCO Co.,Ltd.

FY3/17

FY3/18

FY3/19FY3/20FY3/21

FY3/22

Q1FY3/Q224
FY3/24
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HOME CENTER and HOME FASHION STORE

Trends in Total Return Ratio
Left axis: Total dividends(millions of yen)

Left axis: Treasury sharesacquisition amount (millions of yen)

Right axis: Total return (%)■ Maximize shareholder value by taking
measures such as steady dividend payment
linked with business performance andacquisition and retirement of treasury shares

FY3/14

FY3/15All Rights Copying NAFCO Co.,Ltd.

FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21

FY3/22

FY3/23
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HOME CENTER and HOME FASHION STOREappendix*The Company has applied “Accounting Standard for Revenue Recognition”
and others since the beginning of the fiscal year ended March 31, 2022.
The figures before the application of such Standard and others are presented
based on the disclosed figures before the application.

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2222

HOME CENTER and HOME FASHION STOREStatements of Income

Items(Millions of yen)Six months ended
September 30, 2021

Six months ended
September 30, 2022

Six months ended
September 30, 2023

Results

YoY
Change% ofsales

Results

YoY
Change% ofsales

Results

YoYchange% ofsalesNet sales

107,97585.1%

100.0%

104,62996.9%

100.0%

101,033

96.6%

100.0%

Gross profit

37,529

85.2%

34.8%

36,512

97.3%

34.9%

34,021

93.2%

33.7%

Operating grossprofit37,689-34.9%

36,701

97.4%

35.1%

34,199

93.2%

33.9%

Selling, general andadministrative
expenses

30,603100.8%

28.3%

30,078

98.3%

28.7%

30,165100.3%

29.9%

Operating profit

7,086

51.7%

6.6%

6,622

93.5%

6.3%

4,033

60.9%

4.0%

Ordinary profit

7,304

52.5%

6.8%

6,831

93.5%

6.5%

4,209

61.6%4.2%

Profit

4,531

53.5%

4.2%

4,203

92.8%

4.0%

2,487

59.2%

2.5%

Existing Stores(YoY Change)

Six months ended
September 30, 2021

Six months ended
September 30, 2022

Six months ended
September 30, 2023

Net sales

87.0%

96.7%

96.5%

Customers

84.9%

92.4%

93.0%

Customer average

102.4%

104.5%

103.7%All Rights Copying NAFCO Co.,Ltd.

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HOME CENTER and HOME FASHION STORESegments
Net sales(Millions of yen)Six months ended
September 30, 2021

Six months ended
September 30, 2022

Six months ended
September 30, 2023

Results

YoY
Change% ofsales

Results

YoY
Change% ofsales

Results

YoY
Change% ofSales

Materials, DIY andgardening goods

52,362

88.0%

48.5%

51,217

97.8%

49.0%

48,878

95.4%

48.4%

Household goods

27,055

79.9%

25.1%

26,255

97.0%

25.1%

25,879

98.6%

25.6%

Furniture and homefashion goods

20,049

85.3%

18.6%

18,942

94.5%

18.1%

17,556

92.7%

17.4%

Others

8,507

84.9%

7.9%

8,213

96.5%

7.8%

8,718

106.2%

8.6%

Total

107,97585.1%

100.0%

104,62996.9%

100.0%

101,033

96.6%

100.0%

Gross profit(Millions of yen)Six months ended
September 30, 2021

Six months ended
September 30, 2022

Six months ended
September 30, 2023

Results

YoY
Change% ofSales

Results

YoY
Change% ofSales

Results

YoY
Change% ofsales

Materials, DIY andgardening goods

18,766

86.9%

35.8%

18,654

99.4%

36.4%

17,295

92.7%

35.4%

Household goods

7,841

79.4%

29.0%

7,547

96.2%

28.7%

7,002

92.8%

27.1%

Furniture and homefashion goods

8,276

87.5%41.3%

7,751

93.7%

40.9%

7,139

92.1%

40.7%

Others

2,644

84.8%

31.1%

2,558

96.7%

31.1%

2,584

101.0%

29.6%

Total

37,529

85.2%

34.8%

36,512

97.3%

34.9%

34,021

93.2%

33.7%

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HOME CENTER and HOME FASHION STORE

Number of Stores by Area and Business Type

Number ofStores at theEnd of the Term

Six months ended
September 30, 2021

Six months ended
September 30, 2022

Six months ended
September 30, 2023

Combination
storesHI standalone
storesFurnitureonly
storesCombination
storesHI standalone
storesFurnitureonly
storesCombination
storesHi standalone
storesFurnitureonly
storesKyushu

82

106

382

106

381

107

3

Chugoku andShikoku

3352

133

51

133

50

1Kansai

16

21

716

22

816

23

8

Chubu

913

1

914

2

913

2

Kanto andTohoku

392

392

3

92

143

201

14143

202

16

142

202

16

Total

358

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361

360

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HOME CENTER and HOME FASHION STORE

Balance Sheets
Fiscal Year Ended March 31, 2022

Items
(Millions of yen)

Results

Compared to
the End of thePrevious
Fiscal Year

Change From
the End of thePrevious
Fiscal YearSix months ended
September 30, 2023

Fiscal Year Ended March 31, 2023

Results

Compared to
the End of thePrevious
Fiscal Year

Change From
the End of thePrevious
Fiscal Year

Results

Compared to
the End of thePrevious
Fiscal Year

Chane From theEnd of thePrevious
Fiscal Year

Total assets

233,075

98.7%(3,088)238,408

102.3%+5,333

239,190

100.3%+781

Current assets

100,74498.4%(1,675)

105,748105.0%+5,003

106,540

100.7%+792

Of which, cash anddeposits

34,111

83.2%(6,872)36,123105.9%+2,01140,133111.1%+4,010Non-current assets

132,33198.9%(1,413)

132,660

100.2%+329

132,649

100.0%(10)

118,557

98.8%(1,384)

119,010100.4%+452

119,080

100.1%+69

75,312

90.4%(8,029)76,594101.7%+1,28275,637

98.7%

(957)

20,29392.1%(1,744)

19,03393.8%(1,259)18,808

99.1%

(224)

157,763103.2%

4,941

161,813102.6%

4,050

163,553101.1%+1,739Of which, property,
plant and equipmentLiabilities
Interesting-bearing
liabilities

Net assets

Fiscal Year Ended March 31, 2022

Fiscal Year Ended March 31, 2023

Six months ended
September 30, 2023

Cash and deposit
ratio (%)

14.6%

15.2%

15.8%

Ratio of interestbearing liabilities (%)

8.7%

8.0%

7.9%

Equity ratio (%)

67.7%

67.9%

68.4%

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HOME CENTER and HOME FASHION STORE

Stock (Full-year)
Fiscal Year Ended
March 31, 2021

Fiscal Year Ended
March 31, 2022

Fiscal Year Ended
March 31, 2023

Number ofIssued Shares29,784,400

29,784,400

29,784,400

Number ofTreasury Shares

1,221,600

1,221,800

1,221,800

Net Assets per Share (yen)

5,350

5,523

5,665

Dividend per Share (yen)

50

56

56

Earnings per Share (yen)

409

279

197

Payout Ratio

12.2%

20.1%

28.4

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HOME CENTER and HOME FASHION STOREThis document is intended solely for the purpose of providing information toinvestors.
We will disclose information as needed at an appropriate time depending on
the external environment and the progress of business performance.
This document may contain forward-looking statements. These statements
are not statements of past fact, but are instead forecasts based on
hypotheses and assumptions determined from information available at thecurrent time.
They also involve risks and uncertainties related to economic trends, marketenvironments, and the like.
Actual business performance may therefore differ from the Company’sforecasts.

http://www.nafco.tv(Securities Code︓2790)

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