Don Quijote Holdings. Co., Ltd.

Results for FY 2017
Earnings Results
July 1, 2016 - June 30, 2017

August 15, 2017

0Earnings summary
Consolidated(Millions of yen)

12 months to Jun. 2017
Actual12 months to Jun. 2016

Share

YoY

ActualShare

Net sales

828,798

100.0%

109.1%

759,592

100.0%

Gross profit

218,580

26.4%

108.3%

201,893

26.6%

SGA

172,39520.8%

108.6%

158,708

20.9%

Operating profit

46,1855.6%

106.9%

43,185

5.7%

Recurring profit

45,5235.5%

103.9%

43,797

5.8%

Profit attributable toowners of parent

33,0824.0%

132.7%

24,938

3.3%

EPS(Yen)209.18-132.6%

157.76-• Consolidated and same store sales went up 9.1% and 2.6% YoY respectively. We executed pricing and merchandising strategy basedon the consumer sentiment and external environment. We focused on the rise in traffic and the number of item purchased even if we
temporarily sacrificed the gross profit.
• GPM went down 0.2pts. We increased the gross profit thanks to the private brand and spot procured items.
Non-food items generated satisfying GP while food items attracted the greater number of customer by being more price-competitive.
• Aggressive new store openings triggered the rise in personnel cost and rent. Personnel cost at existing store went down due to theorganization reform. Utility cost and supplies expense dropped. SG&A went down 0.1pts owing to the well-controlled personnel cost.
• OP went up 6.9%, marking the 28th consecutive sales and OP growth. NP jumped by 32.7%.
Net profit hit all time high for 8 consecutive years.
Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

1Same-store sales
115%= Customer traffic= All stores= Customer spending= Existing stores

110%

105%

100%

95%

90%
2014
Dec.
Existing stores

2015
Jun.
2016 July.

Aug.

2015
Dec.

2016
Jun.

Sep.

Oct.

Nov.

Dec.

2017 Jan.

2016
Dec.

2017
Jun.

Feb.

Mar.

Apr.

May.

June.

July.

Sales

103.7%

99.6%

102.6%

102.2%

102.2%

102.6%

102.6%

102.1%

103.2%

102.1%

102.8%

105.1%

105.2%

Customer traffic

101.9%

98.9%

101.2%

100.7%

101.6%

102.5%

102.7%

101.6%

103.6%

103.1%

102.0%

104.5%

104.0%

Customer spending

101.8%100.7%

101.3%

101.5%

100.6%

100.2%

99.9%

100.5%

99.6%

99.0%

100.7%

100.6%

101.1%

Existing store count

236

239

236

238

239

240

244

244

245

247

258

258266• DQ SSS went up 2.6%, traffic +2.2% and spending +0.4% for FY June 2017.
• Aggressive new store openings triggered the rise in personnel cost and rent. Personnel cost at existing store went down due tothe organization reform. Utility cost and supplies expense dropped. SG&A went down 0.1pts owing to the well-controlled personnel cost.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

2

Sales breakdown by product category
12 months to Jun. 2017

Consolidated(Millions of yen)

ActualShare

12 months to Jun. 2016
YoY

ActualShare

Home electrical appliances

68,9128.3%

113.0%

60,9788.0%

Miscellaneous household goods

183,505

22.1%

116.7%

157,288

20.7%

Foods

274,55333.1%

113.4%

242,215

31.9%

Watches & fashion merchandise

158,45119.1%

102.8%

154,183

20.3%

Sporting goods & leisure goods

53,596

6.5%

103.6%

51,722

6.8%

Other products

62,785

7.6%

93.8%66,947

8.8%

Total retail store business

801,802

96.7%

109.3%

733,333

96.5%

Rent income

20,5592.5%

103.9%

19,781

2.6%

Other business

6,437

0.8%

99.4%

6,478

0.8%

828,798

100.0%

109.1%

759,592

100.0%

Total

Home appliances : Headsets took the lead. Smart phone goods such as batteries were strong. Private Brand TV attracted a huge attention.
Household goods : Daily consumables including kitchen goods made a stable growth. Temperature fluctuation encouraged seasonal items.
Foods: Snacks including chocolates were robust. Daily delivered and processed food drew more frequent customers.

Watches & Fashion : Luxury watches hit the bottom. Underwear and sporting wear grew sharply. Bags and shoes were brisk.
Sports & Leisure : Workout equipments and character toys boosted the sales. Leisure goods and seasonal event goods were good.
Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

3

The number of stores(Number of stores)

FY2015FY2016FY2017

Don Quijote

183

194

198

MEGA363940

New MEGA4155

72

Others323944

Total stores in Japan292327354Overseas

141414Grand Total

306

341368Domestic opening

3340

32

Domestic closure1055233527

Net increase• 32 new stores were opened : 11 Don Quijote, 15 New MEGA , 1 MEGA, 1 Kyo-yasu-do, 3 Doit and 1 Picasso.
• 5 stores were closed. 2 closed for insufficient profitability, 2 for relocation and 1 for renewal construction.
• 60% of new stores were formally occupied by other retailers.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

4

Key components in SG&AConsolidated(Millions of yen)

12 months to Jun. 2017
Actual12 months to Jun. 2016

ShareYoY

ActualShare

Net sales

828,798

100.0%

109.1%

759,592

100.0%

Salary allowance

64,5387.8%

108.9%

59,2397.8%

Rent

23,3572.8%

112.1%

20,838

2.7%

Commission paid

19,5242.4%

106.6%

18,3092.4%

Depreciation and amortization

14,0751.7%

105.8%

13,301

1.8%

Others50,901

6.1%

108.3%

47,021

6.2%

SGA

172,39520.8%

108.6%

158,708

20.9%• SGA to sales ratio went down by 0.1pts YoY as costs were perfectly controlled.
• Aggressive new store openings triggered the rise in personnel cost and rent. Personnel cost at existing store went down
due to the organization reform. Utility cost and supplies expense dropped. SG&A went down 0.1pts owing to the well-controlled
personnel cost.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

5

Sales and profit by business（Millions of yen）

Sales, profit and loss by segment from Jul. 1, 2016, to Jun. 30, 2017
Consolidated
Sales to external customers

Retail store

Rent incomeOthers

Total

Adjusted amount

Consolidated

801,802

20,5596,437828,798-

828,798487

20,054

9,156

29,697(29,697)-

Total

802,289

40,613

15,593

858,495(29,697)828,798

Segment profit

23,693

16,123

6,395

46,211(26)

46,185Internal sales or transfers
between segments（Millions of yen）

Sales, profit and loss by segment from Jul. 1, 2015, to Jun. 30, 2016
Consolidated
Sales to external customers

Retail store

Rent income

Others

Total

Adjusted amount

Consolidated

733,333

19,781

6,478

759,592-

759,592

16

18,026

8,486

26,528(26,528)-

Total

733,349

37,807

14,964

786,120(26,528)

759,592

Segment profit

22,74614,1596,733

43,638(453)

43,185Internal sales or transfers
between segmentszProfit in the retail business was 23.7 billion yen which is our mainstay.

• Profit in the tenant leasing business was 16.1 billion yen.
• Profit in other business was 6.4 billion.
Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

6

Sales, profit and asset by subsidiaries（Millions of yen）

Sales, profit and asset by subsidiaries from Jul. 1, 2016, to Jun. 30, 2017
ConsolidatedDon Quijote 1)

DoitNagasakiya 2)

Overseas 3)

JAM 4)

Accretive 5)

Consolidated

Net sales

596,419

16,708

165,700

36,63618,1091,698

828,798

Operating profit

22,492

418

4,814

1,303

7,395

705

46,185

Total asset

240,624

22,93680,54023,038140,255-

642,868

Net asset

119,447

19,435

48,692

16,731

67,131-

279,930

PL/1USD= \108.88
BS/1USD= \112.18（Millions of yen）

Sales, profit and asset by subsidiaries from Jul. 1, 2015, to Jun. 30, 2016
Consolidated

Don Quijote 1)

Doit

Nagasakiya 2)

Overseas 3)

JAM 4)

AccretiveConsolidated

Net sales

532,671

16,403

157,101

40,706

16,9404,834

759,592

Operating profit

20,431

1,004

3,923

2,281

6,970

1,911

43,185

Total asset

225,968

22,63875,635

21,455

109,027

21,911

560,568

Net asset

109,295

18,907

46,242

16,061

14,734

8,216

244,547

1) Figures show the results of retail business at DQ. 2) Nagasakiy a shows only retail business

PL/1USD= \119.99

3) Ov erseas includes DQ USA and MARUKAI

BS/1USD= \112.69

4) Prof it & Loss statement f or JAM shows results f rom July 2016 to June 2017. Balance Sheet shows results as of June 30, 2017.
5) Accretiv e was transf erred f rom subsidiary to equity af f iliate in January 19, 2017.

• Don Quijote and Nagasakiya enjoyed the record high profit.
• Doit and Overseas were impacted by external factors, however, these business areas started new format stores.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

7

Balance Sheet（Millions of yen）
As of Jun. 30,
2017

Change fromJun. 30, 2016

Total current assets

227,585

31,608Cash and deposits

76,340

MerchandiseConsolidated

Total noncurrent assets
Total property, plant and equipment

Buildings
Land
Total intangible assets
Goodwill
Total investments and other assets

Lease and guarantee deposits

Total assets（Millions of yen）
As of Jun. 30,
2017

Change from
Jun. 30, 2016

Total current liabilities

164,825

16,83033,446

Accounts payable

85,661

15,467

123,969

6,569

Short-term liabilities*

25,022(7,901)

415,283

50,692

Total noncurrent liabilities

198,11330,087

310,766

18,714Long-term bonds

74,890(1,581)

118,623

10,509Long-term borrowings

84,63839,556

171,018

5,833

Long-term payables
under fluidity lease receivables

19,366(7,510)15,888(1,117)

Total liabilities

362,938

46,917

5,363(1,489)Net assets

279,930

35,38388,62933,095

Total shareholders' equity

258,282

26,49440,474

4,829

Non-controlling interests

20,7797,783

642,868

82,300Liabilities and net assets

642,868

82,300Consolidated* Short-term liabilities = Short-term loans payable + Current portion of long-term loans payable + Current portion of bonds• Cash & deposits : Long-term borrowings were financed for capex. Cash on hand increased due to the strong sales andinventory reduction.
• Merchandise: Inventories increased associated with 32 new stores. Inventory for existing store went down by 5%.

• Payables associated with the liquidation of receivables : 26.5 billion yen. It went down by 7.5 billion yen from a year ago.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

8

Cash flows and Capital expenditure（Millions of yen）

Consolidated Cash Flows
12 months to Jun.
2017
Cash and equivalents at beginning of period
Cash flows from operating activitiies
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in cash and equivalents
Cash and equivalents at end of period

12 months to Jun.
2016

44,49656,441(40,593)
17,64433,59878,094

51,292
29,110(52,197)
17,148(6,796)44,496

12 months to Jun.
2017
Cash flows*
Net increase (decrease)(6,796)27,331
11,604496
40,39433,598（Millions of yen）

Consolidated Capital Expenditures

Capital expenditures

Change12 months to Jun.
2016

45,357
46,661
1,304

51,57036,881(14,689)

Change(6,213)
9,780
15,993* Cash flows = Net income + Depreciation and amortization + Extraordinary loss - Dividend• Cash flow from operating activities was 56.4 billion yen positive.
Positive factors : 55.3 billion yen of income before income taxes and minority interests, 16 billion yen of depreciation and amortization,
9.1 billion yen increase in trade payables. Negative factors : 3 billion yen of profit from the sale of share of affiliated company and56.4 billion yen for tax payment.
• Cash flow from financing activities was 17.6 billion yen positive driven by 25.4 billion yen of net increase of long-term borrowings and5.3 billion yen of corporate bond issued. 3.5 billion yen of dividend payment were negative factors.
• Capex was 45.4 billion yen to acquire properties for new stores for this year and years afterwards.
Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

9

Earnings summary for Q4
Consolidated(Millions of yen)

3 months to Jun. 2017
Actual3 months to Jun. 2016

Share

YoY

ActualShare

Net sales

208,811100.0%

109.9%

190,045100.0%

Gross profit

54,67526.2%

109.9%

49,75926.2%

SGA

45,62721.9%

109.9%

41,511

21.8%

Operating profit

9,047

4.3%

109.7%

8,248

4.3%

Recurring profit

9,517

4.6%

111.3%

8,548

4.5%

Profit attributableto owners of parent

6,104

2.9%

117.2%

5,206

2.7%

EPS(Yen)

38.59-

117.2%

32.93-

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

10

Sales breakdown by product category for Q4
Consolidated(Millions of yen)

3 months to Jun. 2017
ActualShare

3 months to Jun. 2016YoY

ActualShare

Home electrical appliances

15,7917.6%

110.3%

14,315

7.5%

Miscellaneous household goods

50,12824.0%

123.6%

40,559

21.3%

Foods

71,16034.1%

113.0%

62,964

33.1%

Watches & fashion merchandise

36,723

17.6%

96.7%

37,976

20.0%

Sporting goods & leisure goods

12,4686.0%

107.2%

11,634

6.1%

Other products

16,0157.7%

100.4%

15,958

8.4%

Total retail store business

202,28596.9%

110.3%

183,406

96.5%

Rent income

5,110

2.4%

100.4%

5,090

2.7%

Other business

1,417

0.7%

91.5%

1,549

0.8%

208,811100.0%

109.9%

190,045100.0%

Total

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

11

Key components in SG&A for Q4
Consolidated(Millions of yen)

3 months to Jun. 2017
Actual3 months to Jun. 2016

Share

YoY

ActualShare

Net sales

208,811100.0%

109.9%

190,045100.0%

Salary allowance

16,286

7.8%

107.3%

15,183

8.0%

Rent

6,156

2.9%

113.5%

5,423

2.9%

Commission paid

5,517

2.6%

111.3%

4,959

2.6%

Depreciation and amortization

3,718

1.8%

99.4%

3,741

2.0%

Others13,9506.7%

114.3%

12,206

6.4%

SGA

45,62721.9%

109.9%

41,511

21.8%

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

12Forecast for fiscal June 2018
FY2018 Forecast

Consolidated(Millions of yen)Plan

FY2018 1H Forecast

Share

YoY

Plan

Share

YoYNet sales

880,000

100.0%

106.2%

445,000

100.0%

106.5%

Gross profit

232,000

26.4%

106.1%

117,000

26.3%

105.7%

SGA

184,000

20.9%

106.7%

90,00020.2%

106.8%

Operating profit

48,0005.5%

103.9%

27,0006.1%

102.5%

Recurring profit

48,0005.5%

105.4%

27,0006.1%

100.3%Net profit

28,000

3.2%

84.6%

15,500

3.5%

94.2%

EPS(Yen)

177.02

-

84.6%

97.99

-

94.1%

Capital expenditure

45,000

-

99.2%

--

-

Depreciation

15,0001.7%

106.6%---• Full year forecast : Sales 880 billion yen, OP : 48 billion, RP : 48 billion, NP : 28 billion.
• Don Quijote SSS forecast : DQ SSS forecast : +0.6% in 1H, +0.4% in 2H and +0.5% for full year.

Copyright (c) 2017 Don Quijote Holdings Co.,Ltd. All rights reserved.

13