February 2022
Benesse Holdings, Inc.
Summary of analysts meeting regarding 「Transfer of shares of Berlitz
Corporation」■Date︓February 14, 2022 (Monday) 17:00－17:30■Respondents︓Tamotsu Adachi, Chairman and CEO
Shinsuke Tsuboi, Executive Officer, CFO and Managing Director ofFinance and Accounting
Hiroshi Nishimura, Executive Officer, Managing Director of theOffice of the CEO/COO■Tamotsu Adachi, Chairman and CEO
I will explain the transfer of shares of the Berlitz announced today.
The Board of Directors has resolved today to waive debts owed by Berlitz
Corporation, and to transfer all shares of Berlitz which Benesse holds to a special

purpose company owned by ILSC Holdings LP in Canada, the holding company of
the ILSC Education Group, which is in the language education business including
study abroad support services.
Berlitz, which was considered the worldʼs largest language education enterprise,
was founded in 1878 and became a consolidated subsidiary of Benesse in 1993.
Berlitz became a wholly owned subsidiary of Benesse in 2001. Through theimplementation of its proprietary language learning method – the “Berlitz Method”– its communications business centered on language education pioneered businessmodels that contributed to the developmental growth and globalization ofindividuals and businesses around the world.
In addition, ELS Educational Services, Inc., an entity indirectly wholly-owned byBerlitz, is the largest college-prep English language school in the United States andsupports a multitude of international students with their English language studies.
The Benesse Group has integrated ELS in its business growth plans by partnering
them with Benesseʼs study abroad support services.
Berlitz has made a significant contribution to the development of the Benesse
Groupʼs language education business and study abroad support business. It also
created synergies with teacher placement services for universities and GTEC English
language testing.
Over the years, however, the business recorded operating losses and performance
struggled as it fell behind in new product development to counter rising competition
and the number of international students from the Middle East declined.
In 2017, new management was brought in from outside the company, and drastic
restructuring including franchising was carried out in addition to productdevelopment and marketing reforms in an all-out effort to become profitable.
Thanks to those efforts, in FY2020 business recovered to a point where profitability
was in sight, but then the global COVID-19 pandemic broke out and the Berlitz
business was hit hard.
Amidst the prolonged impact of COVID-19, there was a shift to online classes, theglobal launch of the new product Berlitz 2.0, enhanced digital marketing, andfurther structural reform, and this year losses have been gradually shrinking.
In November 2020, Benesse formulated a medium-term management plan for fiscal
years 2021 to 2025. While Benesse is committed to the pursuit of sustainablegrowth via initiatives such as evolving our core businesses of education and careservices and exploring new areas of growth potential, we are also continuing a policy

of business selection and concentration.
After deliberating on the role Berlitz plays in the business portfolio of the Benesse
Group, and determining that the overseas language education business is notnecessarily our core business, we began negotiations with multiple candidates lastyear. We reached the conclusion that synergies exist between Berlitz and ILSC andthat accelerating Berlitzʼs growth with ILSCʼs support will bring about Berlitzʼsfurther development. As such, it has been resolved as of today that all shares ofBerlitz held by Benesse will be transferred to ILSC SPC.
Even after the share transfer, the Benesse Group will continue to maintain acooperative relationship with the Berlitz Group for its study abroad support services
and other relevant businesses.
Next, our CFO Shinsuke Tsuboi will explain the financial impact.

■Shinsuke Tsuboi, Executive Officer, CFO and Managing Director of Financeand Accounting
I will explain the revised forecast disclosed today and the impact from a numericalaspect.
The matters decided on and disclosed today are the transfer of all shares of Berlitz
Corporation held by Benesse as Mr. Adachi has explained, and the waiver ofapproximately ¥17.8 billion in debts owed by Berlitz. The date of transfer is today,February 14 and the shares are transferred to ILSC SPC. ILSC SPC is a special
purpose company owned by ILSC Holdings LP in Canada, the holding company ofthe ILSC Education Group, which is in the language education business including
study abroad support services.

Next, I will explain the impact of this news on earnings, divided into this year(FY2021) and next year (FY2022) and beyond.
As mentioned in the Notice of Revision to Full-Year Consolidated Financial Results
Forecast, Berlitz, whose fiscal year ends in December is included in consolidated
accounts until the end of September (3Q) but as a result of the share transfer, netsales, operating income, and net income are excluded from our results from 4Q.
This will negatively impact net sales by ¥8.0 billion from the forecast announced inMay 2021. Berlitz was included in consolidated results through 3Q, and the impact
on the full-year operating income forecast is minimal. The debt waiver and theresulting extraordinary loss of around ¥9.8 billion will have a significant impact onnet income. However, the reduction in corporate taxes as a result of the sharetransfer will have a positive impact of around ¥3.5 billion. We are forecasting theoverall negative impact on net income to be around ¥6.3 billion.
Looking at the impact on next year and beyond, we expect the impact of reduced
taxes to be around ¥18.0 billion over 5 years, including this termʼs ¥3.5 billion. We
also expect a positive impact of around ¥3.0 billion on net income next term.
Consequently, we expect ROE to improve substantially from FY2022.
In concrete terms, our capital base is around ¥150.0 billion, and if the positiveimpact of ¥3.0 billion every year continues, ROE will increase by around 2%.

Next is the forecast for FY2021. The outlook for net sales has been revised
downward by ¥8.0 billion from the previous forecast of ¥441.0 billion to ¥433.0billion. The operating income and ordinary income forecasts are unchanged.
The initial forecast for net income attributable to owners of the parent was ¥5.0
billion, but taking recent performance trends and the share transfer and debt waiver
into consideration, we have reduced our net income forecast to zero.
There is no change in the forecast of ¥25 per share year-end dividend (¥50 for fullyear).