This document is an English translation of a statement written originally in Japanese. The Japanese original should
be considered as the primary version.

Consolidated Financial Results for Nine Months Ended February 28, 2022
(Japanese GAAP)

April 4, 2022
Name of Listed Company: CREATE SD HOLDINGS CO., LTD.
Listing: Tokyo Stock Exchange
Securities code: 3148
URL: https://www.createsdhd.co.jp/English/tabid/129/Default.aspx
Representative: Taizo Hirose, Representative Director and President
Contact: Tetsuya Yamazaki, Executive Officer and General Manager, Finance andTel: +81-45-914-8241
Accounting Dept.
Scheduled filing date of Securities Report: April 8, 2022
Scheduled date of start of dividend payment: ―Supplementary materials for the financial results: None
Quarterly results briefing sessions: None
(Figures are rounded down to the nearest million yen)

1. Consolidated Third Quarter Results for Fiscal Year Ending May 31, 2022 (June 1, 2021 to February 28, 2022)(1) Consolidated Operating Results(Figures in percentages denote the year-on-year change)
Profit attributable toOperating profit
Ordinary profit
owners of parent

Net sales
Millions of yen% (Millions of yen)

% (Millions of yen)

Nine months ended
260,636
3.3
13,240–8.2
13,606
February 28, 2022
Nine months ended
252,374
8.5
14,42619.1
14,752February 28, 2021
(Note) Comprehensive income: Nine months ended February 28, 2022: ¥9,234 million (–8.3%)
Nine months ended February 28, 2021: ¥10,070 million (19.4%)
Earnings per share%% (Millions of yen)

％

–7.8

9,227

–7.9

19.1

10,014

19.4

Diluted earnings per share

Yen

Yen

Nine months ended
145.95－February 28, 2022
Nine months ended
158.40－February 28, 2021
The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 revised March 31, 2020) effectivefrom the beginning of the first quarter of the fiscal year ending May 31, 2022. Said standard has been applied to financial statement
data contained herein for the nine months ended February 28, 2022.

(2) Consolidated Financial Position
Total assets
Millions of yen

Total net assets
Millions of yen

Equity ratio%

As of February 28, 2022
166,896
103,013
61.7
As of May 31, 2021
163,824
96,63859.0(Reference) Net assets: As of February 28, 2022: ¥103,013 million
As of May 31, 2021: ¥96,638 million
The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 revised March 31, 2020) effectivefrom the beginning of the first quarter of the fiscal year ending May 31, 2022. Said standard has been applied to financial statement
data contained herein for the nine months ended February 28, 2022.

12. Dividend Payments
Dividends per shareFirst quarter

Second quarter

Yen

Third quarter

Yen

Fiscal year ended
21.00－
May 31, 2021
Fiscal year ended—
23.00
May 31, 2022
Fiscal year ending
May 31, 2022 (forecast)(Note) Revisions to most recently announced dividend forecast: None

Year-end

Annual

Yen

Yen

Yen

－

23.00

44.00

23.00

46.00

—

3. Consolidated Financial Forecast (From June 1, 2021 to May 31, 2022)
Preliminary remarks on consolidated financial results forecasts
Net sales
Millions of yen(Figures in percentages denote the year-on-year change)
Profit attributable toEarnings per
Ordinary profit
owners of parent
share

Operating profit%

Millions of yen%

Millions of yen%

Millions of yen%

Yen

Full-year
352,600
4.2
19,3804.0
19,8003.9
12,7703.2
202.00(Notes)
1. Revisions to most recently announced financial results forecast: None
2. The Company applied the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29 revised March 31, 2020) effectivefrom the beginning of the first quarter of the fiscal year ending May 31, 2022. Said standard has been applied to the above consolidated
financial results forecasts.

2

Notes(1) Significant changes of subsidiaries in nine months ended February 28, 2022 (changes in specific subsidiaries
accompanied by a change in the scope of consolidation):
None
Newly consolidated: ― companies (company name(s)); Deconsolidated: ― companies (company name(s))
Notes on significant changes of subsidiaries during period(2) Application of accounting treatments specific to preparation of quarterly consolidated financial statements: Not
applicable
Notes on application of accounting treatments specific to preparation of quarterly consolidated financial statements(3) Changes in accounting policies, changes of accounting estimates and restatement(i) Changes in accounting policies due to amendments to accounting standards: Yes(ii) Other changes in accounting policies:None(iii) Changes in accounting estimates:None(iv) Restatements:
None
Notes on changes in accounting policies(4) Issued shares (common shares)(i) Issued shares (including treasury
shares) at period-end:(ii) Treasury shares at period-end:(iii) Average issued shares during period:

Nine months ended
February 28, 2022
Nine months ended
February 28, 2022
Nine months ended
February 28, 2022

66,819,342 shares
3,600,755 shares
63,218,596 sharesFiscal year ended
May 31, 2021
Fiscal year ended
May 31, 2021
Nine months ended
February 28, 2021

66,819,342 shares
3,600,728 shares
63,218,650 shares

Note on issued sharesThis financial summary is not subject to a quarterly review by certified public accountants or audit firms.
Cautionary statement regarding business results forecasts and special notes(Notes concerning forward-looking statements, etc.)
The financial forecasts and other forward-looking statements contained herein are based on currently available information and certain
assumptions considered by the Company to be reasonable. Actual financial results may differ materially due to various factors. Refer to“(3) Overview of Consolidated Financial Results Forecast and Future Expectations” on page 3 of the supplementary material for theunderlying assumptions and proper use of the forecasts.

3

Contents

1.. Qualitative Information Related to Consolidated Financial Results ……………………………………………………2(1) Overview of Operating Results………………………………………………………………………………………… 2(2) Overview of Financial Position………………………………………………………………………………………… 3(3) Overview of Consolidated Financial Results Forecast and Future Expectations ……………………………………… 3
2. Consolidated Financial Statements and Notes……………………………………………………………………………4(1) Consolidated Balance Sheet …………………………………………………………………………………………… 4(2) Consolidated Statements of Income and Comprehensive Income………………………………………………………6(3) Notes to Consolidated Financial Statements…………………………………………………………………………… 8
Going concern assumption …………………………………………………………………………………………… 8
Notes in case of significant changes in shareholders’ equity ………………………………………………………… 8
Application of specific accounting treatment in the preparation of consolidated financial statements ……………… 8
Changes to accounting policies………………………………………………………………………………………

8

Additional information………………………………………………………………………………………………… 9
3. Supplemental Information ……………………………………………………………………………………………… 10(1) Production, Orders Received, and Sales Supplemental Information-1-……………………………………………10

1.Qualitative Information Related to Consolidated Financial Results(1) Overview of Operating Results
During the first nine months of the fiscal year ending May 31, 2022, the future of the Japanese economy remained uncertain due
to heightened geopolitical risks on top of the ongoing difficult circumstances arising from the COVID-19 pandemic.
The business environment in the drug store industry remains harsh due to the entry of new competitors from other industries
and an increase in consolidation and restructuring on top of new store openings by competitors and intensification of pricecompetition.
Under these circumstances, the Group will promote comprehensive health care support for regional contribution in the domainsof daily life, prevention, medical care, and nursing care.
Drug Stores
In the drug store business, our top priority is the safety and security of our customers, patients, and employees. While voluntarily
refraining from sales promotions that would create waves of customer attraction, we have been promoting everyday low prices(EDLP) in which we provide products at attractive prices no matter when customers come to our stores. In addition, in order toaddress the need for one-stop shopping in which the necessities for daily life are available in one place, we worked to renovate
our stores to improve food sales, including enhancing our fresh and frozen food offerings. At the same time, we promoted in-store
prescription drug stores and continued to focus on improving convenience and expertise in small trade areas. In regard to theimpact of COVID-19, there was a reactionary drop in demand in response to expanded demand in the previous year driven by
products to prevent the spread and stay-at-home products, but due in part to the resurgence of COVID-19 caused by the spread of
the Omicron variant starting in January, net sales were strong, driven by food products.
We established a Sustainability Promotion Committee chaired by the President and Representative Director to engage in efforts
to promote sustainability management. The committee established a Basic Policy on Sustainability and identified material issues(materiality). We also worked on strengthening the governance structure, including by establishing a Nomination andRemuneration Committee as an advisory body to the Board of Directors.
During the period, we opened 20 new drug stores. Meanwhile, we also closed one for which the contract expired.
Moreover, we opened 32 new in-store prescription drug stores and two dedicated prescription drug stores. This total of 34
openings surpassed the number of drug store openings. Meanwhile, we also closed one dedicated prescription drug store for which
the contract expired.
Nursing Care
As society ages, we are operating paid assisted living facilities characterized by delicious meals for elderly people that want tolive safely and securely under the care of nursing staff as well as an adult day care center characterized by functional maintenanceand recovery training for living at home for those who want to live at home as long as possible.
During the first nine months of the fiscal year ending May 31, 2022, we took care to prevent the spread of COVID-19 in our
paid assisted living facilities and adult day care services while also pouring effort into customer service, which is one of the
distinctive characteristics of our Group, to increase user satisfaction and improve operating rate. In addition, in order to improve
the profitability of adult day care services, we increased the capacity per facility.
Owing to the efforts above, as of the end of the first nine months of the fiscal year ending May 31, 2022, the number of theGroup’s drug stores came to 678, the number of dedicated prescription drug stores to 37, and the number of in-store prescription
drug stores to 258, for a total of 295 stores in the drug store business. The Group also has five stores in the supermarket businessand two paid assisted living facilities and 39 adult day care service centers in the nursing care business.
As a result of the above, the financial results for the first nine months of the fiscal year ending May 31, 2022 were as follows:
Net sales came in at ¥260,636 million (up 3.3% year on year), operating profit was ¥13,240 million (down 8.2%), ordinary profit
was ¥13,606 million (down 7.8%), and profit attributable to owners of parent was ¥9,227 million (down 7.9%).
The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020) has been applied as of the
beginning of the first quarter of the fiscal year ending May 31, 2022. For this reason, the figures for comparison with the previous
year are based on calculation methods set forth under different standards. See “(3) Notes to Consolidated Financial Statements(Changes to accounting policies)” under “2. Consolidated Financial Statements and Notes” for details.

-2-(2) Overview of Financial Position
Total assets as of February 28, 2022 were ¥166,896 million, up ¥3,071 million from the end of the previous fiscal year. The main
factors were a ¥588 million increase in merchandise and a ¥4,909 million increase in non-current assets as well as a ¥2,143 million
decrease in cash and deposits.
Total liabilities as of February 28, 2022 were ¥63,882 million, down ¥3,303 million from the end of the previous fiscal year.
The main factors were a ¥938 million decrease in accounts payable, a ¥3,440 million decrease in provision for point cardcertificates, and a ¥1,624 million decrease in accrued income taxes.
Total net assets as of February 28, 2022 were ¥103,013 million, up ¥6,375 million from the end of the previous fiscal year. The
main factors were a ¥2,908 million decrease in dividends paid and recording of ¥9,227 million in profit attributable to owners ofparent.

(3) Overview of Consolidated Financial Results Forecast and Future Expectations
At this time, no changes have been made to the forecasts for the fiscal year ending May 31, 2022 announced on July 12, 2021.

-3-2. Consolidated Financial Statements and Notes(1) Consolidated Balance Sheet(Millions of yen)
FY2020(As of May 31, 2021)

3Q of FY2021(As of February 28, 2022)

AssetsCurrent assets
Cash and deposits
Accounts receivable - trade39,282
9,682

37,13810,356Merchandise
Other

33,456
8,663

34,044
7,705

Total current assets

91,08489,246

20,89822,079Land
Other, net

15,272
4,504

17,196
4,381

Total property, plant and equipment

40,67543,658712

623

Non-current assets
Property, plant and equipment
Buildings and structures, net

Intangible fixed assets
Goodwill
Other

885

918

1,598

1,541

Long-term loans receivable
Leasehold and guarantee deposits

9,776
10,867

9,722
11,172

Other
Allowance for doubtful accounts

9,867
(45)

11,597(43)

Total investments and other assets

30,46632,45072,74077,650163,824

166,896

41,6993,297

40,760
1,672

328

1,545

Total intangible assets
Investments and other assets

Total non-current assets
Total assets
Liabilities
Current liabilities
Accounts payable - trade
Accrued income taxes
Accrued bonuses
Provision for bonuses for directors (and otherofficers)
Provision for point card certificates
Asset retirement obligations

128

112

3,596
19

155
19

Other

10,70011,888

Total current liabilities

59,76956,154

Net defined benefit liability
Asset retirement obligations

2,708
3,238

2,973
3,371

Provision for loss on subleasing
Other

32
1,438

39
1,344

Total non-current liabilities

7,416

7,728

67,18663,882

Non-current liabilities

Total liabilities-4-

(Millions of yen)
FY2020(As of May 31, 2021)

3Q of FY2021(As of February 28, 2022)

Net assets
Equity capital
Share capital
Capital surplus

1,000
934

1,000
934

Retained earnings
Treasury shares

99,114(4,393)

105,481(4,393)

Total shareholders’ equity

96,655103,022

23

22

(40)

(31)

(17)

(9)

Total net assets

96,638103,013

Liabilities and net assets

163,824

166,896

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income-5-(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statement of Income
First nine months of the fiscal year ending May 31, 2022

Net sales
Cost of sales

3Q of FY2020(From June 1, 2020
to February 28, 2021)
252,374
182,777(Millions of yen)
3Q of FY2021(From June 1, 2021
to February 28, 2022)
260,636
190,017Gross profit

69,59770,619Provision for point card certificates
Salaries and allowances

3,546
21,954155
24,013

Provision for bonuses
Provision for directors’ bonuses

1,372
94

1,482
103

Retirement benefit expenses
Depreciation and amortization

373
2,638

334
2,794

Land/office rent
Other

11,15914,031

11,934
16,560Total selling, general and administrative expenses

55,17057,37814,426

13,240Interest income
Dividend income

73
0

69
0

Gain on receipt of donated non-current assets
Rent income

66
226

35
229

Other

101

162

Total non-operating income

469

498

0
3

－
0

Rental expenses
Other

129
8

127
4

Total non-operating expenses

142

132

14,752

13,606

Subsidy income

2－

Total extraordinary income

2

－

3

3

2

－

Selling, general and administrative expenses

Operating profit
Non-operating profit

Non-operating expenses
Interest expenses
Compensation expenses

Ordinary profit
Extraordinary profit

Extraordinary losses
Loss on retirement of non-current assets
Loss on tax purpose reduction entry of non-current
assetsTotal extraordinary losses

5

3

14,74913,602

Income taxes

4,735

4,375

Profit10,014

9,227

Profit before income taxes

Profit attributable to non-controlling interests
Profit attributable to owners of parent

-6-

－

－

10,0149,227

Consolidated Statement of Comprehensive Income
First nine months of the fiscal year ending May 31, 2022

ProfitOther comprehensive income

3Q of FY2020(June 1, 2020 February 28, 2021)
10,014(Millions of yen)
3Q of FY2021(June 1, 2021 February 28, 2022)
9,227

6
49

(1)
8

Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income
Comprehensive income

55

7

10,0709,234

10,070

9,234

－

－

Comprehensive income attributable to:
Owners of parent
Non-controlling interests-7-(3) Notes to Consolidated Financial Statements
Going concern assumption
Not applicable
Notes in case of significant changes in shareholders’ equity
Not applicable
Application of specific accounting treatment in the preparation of consolidated financial statements(Calculation of tax expenses)
We make a reasonable estimate of the effective tax rate to be imposed on profit before income taxes in the fiscal year ending
May 31, 2022, including the first nine months, after applying tax effect accounting and perform the calculation by multiplying
profit before income taxes by the estimated effective tax rate.
Changes to accounting policies(Adoption of accounting standard related to revenue recognition)
The Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020) has been adopted as of the
beginning of the first quarter of the fiscal year ending May 31, 2022. The amount to be received in exchange for goods orservices is recognized as revenue at the point when control of the promised goods or services is transferred to the customer.
The main changes resulting from this are as follows:(1) In regard to the points program operated by the Company, the Company previously recorded the expenses expected inrelation to future redemption as a provision, but this has been changed to a method in which the points are recognized as
performance obligations, and the recording of revenue is deferred in cases where they provide important rights to thecustomer.
(2) In regard to revenue from purchasing for consumption, the Company previously recognized the entire amount as revenue,
but this has been changed to a method in which the net amount is recognized as revenue after determining the role (principal
or agent) in providing the goods or services to the customer.
In regard to application of the Accounting Standard for Revenue Recognition, following the transitional treatment set forthin the proviso in paragraph 84 of the Accounting Standard for Revenue Recognition, the Company has applied a new
accounting policy from the beginning of the fiscal year ending May 31, 2022 in which the cumulative effect is added to or
subtracted from retained earnings at the beginning of the first quarter when a new accounting policy is applied retroactively
from the beginning of the first quarter.
Because the Accounting Standard for Revenue Recognition was applied, some of the provision for point card certificatespresented under current liabilities in the consolidated balance sheet for the previous fiscal year is included under contract
liabilities as of the first quarter of the fiscal year ending May 31, 2022. Following the transitional treatment set forth inparagraph 89-2 of the Accounting Standard for Revenue Recognition, the Company has not restated the financial results of theprevious fiscal year to reflect the new method of presentation.
As a result, in the first nine months of the fiscal year ending May 31, 2022, net sales decreased by ¥2,765 million, cost of
sales decreased by ¥335 million, selling, general and administrative expenses decreased by ¥2,470 million, while operating
profit, ordinary profit, and profit before income taxes each increased by ¥40 million. In addition, the beginning balance ofretained earnings increased by ¥48 million.
Following the transitional treatment set forth in paragraph 28-15 of the Accounting Standard for Quarterly Financial
Reporting (ASBJ Statement No. 12, March 31, 2020), there is no information on a breakdown of revenue from contracts withcustomers in the first nine months of the previous fiscal year.
Application of Accounting Standard for Fair Value Measurement
The Accounting Standard for Fair Value Measurement (ASBJ Statement No. 30, July 4, 2019) has been applied from the
beginning of the first quarter of the fiscal year ending May 31, 2022. Following the transitional treatment set forth in paragraph-8-19 of the Accounting Standard for Fair Value Measurement and paragraph 44-2 of the Accounting Standard for Financial
Instruments (ASBJ Statement No. 10, July 4, 2019), the new accounting policy set forth in the Accounting Standard for Fair
Value Measurement will be applied into the future. This has no impact on the quarterly financial statements.
Additional Information
There are no significant changes to the assumptions regarding the impact of COVID-19 described in (Additional Information)and (Accounting Estimates for Impact of COVID-19) in the securities report for the previous fiscal year.

-9-3. Supplemental Information(1) Production, Orders Received, and Sales
1) Sales results(i) Sales results by product division
Sales results by product division during the first nine months of the fiscal year ending May 31, 2022 were as follows:
3Q of FY2021(From June 1, 2021 to February 28, 2022)
Product division

Amount (millions of yen)

YoY change (%)

Drug Stores
Medical and health products

69,578103.8

OTC42,754

97.9

Prescription drug stores

26,823114.9

Cosmetics

31,332

102.7

Food products

101,091

104.3

Daily products

41,067

101.6

Other

12,606100.5

Subtotal

255,675

103.3

3,291

99.1

Paid assisted living facilities

565

107.1

Adult day care services

1,016

97.1

Subtotal

1,581

100.5

Revenue from contracts with customers

260,548

103.2

Other revenue (Notes)

88

－

Total

260,636

103.3

Supermarkets
Nursing Care

(Notes)
1. As stated under Changes to Accounting Policies, the Accounting Standard for Revenue Recognition was applied from the
beginning of the first quarter of the fiscal year ending May 31, 2022, which changed the accounting treatment related torevenue recognition. As such, sales by product division have also been changed.
2. Other revenue includes rent income based on the Accounting Standard for Lease Transactions (ASBJ Statement No. 13).

- 10 -

(ii) Sales results by region
Sales results by region during the first nine months of the fiscal year ending May 31, 2022 were as follows:
3Q of FY2020(From June 1, 2021
to February 28, 2022)
Amount (millions of
yen)

3Q of FY2021(June 1, 2021 February 28, 2022)

Share (%)

Amount (millions ofyen)

Share (%)

Kanagawa

155,586

61.6

162,370

62.3

Tokyo

36,84914.6

37,110

14.2

Shizuoka

29,765

11.8

29,430

11.3

Chiba

17,3306.9

18,377

7.1

Other

12,842

5.1

13,347

5.1

Total

252,374

100.0

260,636100.0(Note) As stated under Changes to Accounting Policies, the Accounting Standard for Revenue Recognition was applied fromthe beginning of the first quarter of the fiscal year ending May 31, 2022, which changed the accounting treatment related
to revenue recognition. As such, sales by region have also been changed.
(2) Purchase results
Purchase results by product division during the first nine months of the fiscal year ending May 31, 2022 were as follows:First nine months of the fiscal year ending May 31, 2022
(From June 1, 2021 to February 28, 2022)
Product division

Amount (millions of yen)

YoY change (%)

Drug Stores
Medical and health products

41,42592.5

OTC

24,99081.1

Prescription drug stores

16,434

117.5

Cosmetics

19,71997.7

Food products

86,664110.0

Daily products

29,052

103.1

Other

9,680

103.1

Subtotal

186,543

102.9

2,495

101.3

Paid assisted living facilities――

Adult day care services――

Subtotal――

189,038

102.8

―

―

189,038

102.8

Supermarkets
Nursing Care

Revenue from contracts with customers
Other revenue
Total(Note) As stated under Changes to Accounting Policies, the Accounting Standard for Revenue Recognition was applied from the
beginning of the first quarter of the fiscal year ending May 31, 2022, which changed the accounting treatment related torevenue recognition. As such, purchase results have also been changed.

- 11 -