Investors’ Guide 2016

U.S.M. Holdings at a Glance

Message from the Management

Business Philosophy of U.S.M.Holdings
We

Our corephilosophy● Offer customers healthy, valuable choices in food
● Cultivate deep relationships to build prosperous local communities● Constantly pursue innovation and move with the times

In our business, we aim to

We aim to create value as aregionally focused enterpriseby building close relationships
with our local community.

● Offer products and services tailored to various lifestyle choices that give customers

access to a range of healthy, valuable foods● Create a corporate culture that supports employee self-fulfillment by providing skills

Businessvisiontraining and encouraging people to achieve their potential

Hiromasa Kohama● Continually develop and grow over time while seeking to maximize enterprise value

Chairman and
Representative Director● Create new value based on fair dealings with our business partners for customer benefit

President andRepresentative Director● Welcome new companies into the group to help us meet the needs of local communities

United Super Markets Holdings Inc. (U.S.M. Holdings)

chains already shared the business philosophy of putting theand engage in fair, transparent corporate governance while respecting the managementof each member company of U.S.M. Holdings.

was established on March 2, 2015 as a joint holding com-

customer first and contributing to local communities. Togeth-pany for The Maruetsu, Inc., Kasumi Co., Ltd., and Max-er, we aim to create the leading supermarket chain in terms of

Valu Kanto Co., Ltd.

scale and quality in the Kanto region and provide our custom-

Outline of U.S.M. Holdings

U.S.M. Holdings is the largest integrated supermarket

ers with high-quality food at home. Integrating the three oper-

operator by sales in the region comprising Tokyo and its

ators to create a network with regional scale has allowed us

six adjacent prefectures. Every day, our stores serve over

to pool capabilities while focusing on innovation, based on ashared business vision.

The Maruetsu, Inc.

Kasumi Co., Ltd.

1.1 million c. We will continue developing and evolving

Established in 1945, Maruetsu
celebrated its 70th anniversary
in October 2015. The chain of
285 stores as of the end of
Feb. 2016 is developing under
the three formats of“Maruetsu,” “Maruetsu Petit,”and “Lincos.”(See P. 5 for details)

Established in 1961, Kasumi
had a chain of 170
supermarkets as of the endof Feb. 2016. With threeformats, Kasumi gives storesautonomy based on a “Social
Shift” management ethos.
(See P. 6 for details)

our business by cultivating close connections between

We adopted a new joint holding company structure toeach of our stores and their local communities, leverag-manage the integration process. This approach has helped

ing our strengths to create possibilities for the future.

us retain the brand value created by each operator overCreating new value
through the evolving
expertise of our threecompanies

MaxValu Kanto Co., Ltd.
Established in 2009, MaxValu Kanto had a chain of 39
supermarkets as of the end of Feb. 2016 with a businessapproach emphasizing user reassurance, lifestyle andlocal produce while developing a brand of supermarkets
geared toward great taste and convenience.
(See P. 7 for details)
1

Makoto Ueda

many years and acknowledges the value of management

Background to the creation of U.S.M. Holdings

autonomy in developing services that truly serve the local

The supermarket sector in Japan has been consolidating incommunity. To put it another way, the supermarket opera-

the face of tough competition not only from other supermar-

tors remain the basis of our retail business and the role of the

ket chains, but also from other retail sectors such as discountholding company is to find ways to create new products andstores, convenience stores, drugstores, online retailers andservices that customers will see as added value.

meal delivery services.
To thrive amid fierce competition in such a fast-changing

Future prospects

environment, it is essential to maximize enterprise value by

While leveraging economies of scale created by integrating“creating original value,” which means providing products andthe three operators and promoting the growth of each, we will

services tailored to the various lifestyles of our customers.

also seek to welcome other similarly minded supermarket operators in the region into the U.S.M. Holdings group. By Feb-

Integrated but still uniqueruary 2021, we aim to achieve consolidated operating reve-

The Maruetsu, Kasumi and MaxValu Kanto supermarket

nue of ¥1 trillion and develop a network of over 1,000 stores.
2

Business at a GlanceTochigi
Prefecture

Network

9 stores

Gunma
Prefecture

6 storesWe develop store formats aimed at increasing customer satisfaction.
The Maruetsu, Inc.
Maruetsu brand development

Moving ahead with regional
development in Tokyo andadjacent markets

SaitamaPrefecture

Maruetsu Petit

The three formats are: “Maruetsu,” an enjoyable
place to shop daily for fresh food and other groceries; “Maruetsu Petit,” an urban-format supermarket tailored to city residents; and “Lincos,” asupermarket offering high-quality merchandiseand service (includes two stores in China).

Maruetsu

Lincos (China)

LincosKasumi Co., Ltd.
Kasumi brand development

Fiscal year ended February 29, 2016: total of 30 new
stores opened, expanding the network to 494 stores

Food Market

Food Square

The three supermarket formats are the flagship“Food Square” brand marketing new delights formealtimes, the core “Food Market” brand supplying groceries to suit local tastes and customs,
and a discount format offering everyday low prices under the “Food Off Stocker” brand.

U.S.M. Holdings opened a total of 30 new stores in the fiscal
year ended February 29, 2016, split between Maruetsu (16),Kasumi (13) and MaxValu Kanto (1). A total of 15 stores werealso closed (Maruetsu 7, Kasumi 2, MaxValu Kanto 6) aspart of a scrap-and-build policy to try to maximize operational efficiency. The overall network comprised 494 storesat year-end.

Food Off StockerTokyo

93 stores

49 stores

494 stores

Number of U.S.M. Holdings Group stores* Number of stores by company and by prefecture as of February 29, 2016

Maruetsu

Kasumi2
92
32
30

Tochigi Prefecture

137
1
46
53
47
1

Gunma Prefecture

ー

Tokyo
Ibaraki Prefecture
Chiba Prefecture
Saitama Prefecture
Kanagawa Prefecture

18
1
15
3
2

ー

ー

8
6
170

285

Total

MaxValu Kantoー39

Number of stores (graph)■Maruetsu■Kasumi■MaxValu Kanto

451(stores)479

494

422 19439 22

141

146

151

159

170

262

271

268

276

285

Feb. 201332

Feb. 201444

Feb. 201539

Feb. 2016* The two Maruetsu stores in China are not included.

Selected new stores opened in the fiscal year ended February 29, 2016
Maruetsu Tobitakyu Store

Food Square Kasumi Higashi-Narashino Store

MaxValu Narita Tomisato Store

Chofu-shi, Tokyo

Narashino-shi, Chiba Prefecture

Narita-shi, Chiba Prefecture

May

15

3

Chiba
Prefecture

Kanagawa
Prefecture

Breakdown of our stores

MaxValu Kanto brand development

Stores trading under the “MaxValu” format aim to
maximize value for customers shopping for daily
groceries in terms of quality, price, range andservice, while the “MaxValu Express” format offers convenience, competitive prices and surprising variety that changes daily for those shopping for everyday grocery items.

157 storesFeb. 2012

MaxValu Kanto Co., Ltd.

94 stores

86 stores

Focused on Japan’s richest and most promisingurban market
U.S.M. Holdings was created for operations within the regionof Tokyo and the adjacent prefectures. This is Japan’s richestand most promising retail market due to the rising demand
created by the continuous net influx of population plus thegrowing number of overseas visitors.
As of the end of February 2016, the U.S.M. Holdings retail
network totaled 494 supermarkets in the Kanto region, comprising Tokyo and its six adjacent prefectures. U.S.M. Holdings boasts by far the largest market share in this region. The
chain expansion strategy seeks not only to exploit market
share dominance and economies of scale, but also to upgrade the quality of the retail offering as a vital ingredient inkeeping a tight regional focus and paying attention to theneeds of local customers. Going forward, U.S.M. Holdings
aims to retain and build on the support of customers by introducing convenience store-style services at smaller urban outlets and developing formats to integrate supermarkets withdrugstores or other outlets.

IbarakiPrefecture

MaxValu

October

7

November

17

MaxValu Express

4Maruetsu

Meeting local needs withvaried store layouts
Realizing “happy lifestyles” for customers
Although Maruetsu is the largest food-oriented supermarket
chain in the Tokyo region, Maruetsu strives to cater to local
needs with a variety of store layouts, ranging from small 130
m2 outlets under the “Maruetsu Petit” brand, to large 5,000
m2 “Maruetsu” supermarkets. The small “Maruetsu Petit” urban outlets have been developed in recent years to emphasize
fresh produce (fruit and vegetables, meat and fish) and freshly
prepared dishes to set itself apart from convenience store
chains. Such outlets help relieve the inconvenience of grocery
shopping in city centers.
Maruetsu introduced its own private label, “maruetsu365,”(maruetsu san-go-roku) in 2010. The brand’s concept is to offer
products with extra features providing added value at reasonable
prices. The private-label merchandise range has been expanded
and updated, and included around 245 items as of the end of
February 2016. It has proved highly popular with customers.
Having celebrated its 70th anniversary in October 2015,
Maruetsu currently serves around 650,000 customers eachday. Although it has grown into a large chain, the focus remains on creating vibrant stores where consumers feel welcome and on building strong connections with local customers to contribute to their happy lifestyles.

The Maruetsu, Inc. Corporate Data
Head office

Higashi-Ikebukuro, Toshima-ku, Tokyo

Established

October 1945

Capital37.5 billion yen

Kasumi-style value cultivated by“Social Shift” management ethos“Social Shift” management aims to build storesloved by the community through autonomous
actions for the benefit of customers

Main initiatives in the fiscal year ended February 29, 2016

The “Social Shift” management ethos adopted by Kasumi in2013 emphasizes management autonomy to enable eachstore to cultivate vitality based on customer feedback and employee ideas. The “Kasumi Value Perspective,” adopted in2014, involves putting the customer-first business philosophy
into practice. In line with this, Kasumi is introducing mechanisms to help generate information and ideas about better
merchandising and services for customers.
The “Social Shift” management ethos at Kasumi targets
sustainable growth by augmenting the originality of store layouts
and merchandising. For example, since 2001, all Kasumi stores
have assigned space specifically for local products. Today,
some 3,800 such items are on sale across the chain as a whole.
In line with this initiative, Kasumi has dedicated space within its
produce section for vegetables supplied by local farmers. Customers typically support this grow-local-buy-local model sincelocally grown vegetables in season are often fresher and tastier.
Today, around 1,300 farmers supply fresh local produce to 138
Kasumi stores. Kasumi has built on its close community links
while also seeking to take advantage of the model’s growth potential. Promoting the “Social Shift” management ethos is a key
part of ensuring sustainable growth into the future.

Threefold evolution through“transformation ahead of future growth”

Main initiatives in the fiscal year ended February 29, 2016

Maruetsu had positioned the fiscal year ended February 29,
2016 as one of “transformation ahead of future growth,” withthe emphasis on promoting greater competitiveness, higher
productivity and more advanced management capabilities.
In practical terms, efforts focused on strengthening the
fresh produce category to attract more customers, renewing
the mainstays in the lineup of delicatessen items, and expanding the range of prepared fish and meat products supplied byprocessing facilities. Besides refurbishing and renovating existing stores, Maruetsu also sought to improve productivity by
expanding the use of automatic ordering systems at certain
stores under central control, testing partial self-checkout systems, and promoting paperless operations. Non-consolidated
operating revenues for Maruetsu rose 5.9% in the fiscal year
ended February 29, 2016 to ¥363,259 million.

5

KasumiNumber of stores

285 stores

Number of employees 15,609*As of February 29, 2016

Kasumi Co., Ltd. Corporate Data
Head office

Nishiohashi, Tsukuba-shi, Ibaraki Prefecture

Established

June 1961

Capital14.4 billion yen

Number of stores

170 stores

Number of employees 10,245*As of February 29, 2016

Initiatives to make stores integral to the community based on “Social Shift management” measures
In fiscal 2015, the third year of measures based on the “Social
Shift” management ethos, Kasumi extended autonomy tomore outlets, raising the number of such stores to 123. Employees plan their own initiatives at these stores to cultivate
local connections, including events that involve customer participation and opportunities to sample seasonal local produce.
In other initiatives to help stores function as an integral partof the community, Kasumi outlets have introduced “Eat-in”
spaces where customers can gather, relax and eat. These
spaces are also being used as venues for cooking classes,
exercise classes, birthday parties and other events to serve
local community needs, with the details varying by store.
Kasumi shares these events and in-store highlights in realtime via its Facebook page. In this way, Kasumi is developing
stores that forge deeper connections with shoppers, who see thesupermarket as “their store.” Reflecting the success of these initiatives, non-consolidated operating revenues for Kasumi grew
6.7% in the year ended February 29, 2016, to ¥249,000 million.
6

MaxValu Kanto

Brightening the community, always
from the customer’s perspective
Always offering something new and different
attuned to changing customer lifestyles
MaxValu Kanto strives to ensure that its stores reflect therhythms of local daily life. Food ranges on display change frequently: in April, stores celebrate the new beginnings and cherry
blossom viewing; in May, the themes are the Golden Week holiday and Mother’s Day. Weekly changes to the merchandise
layout reflect our efforts to make customers feel that MaxValu
stores are always offering something different and new. Seasonal merchandise is another vital part of the MaxValu offering, tohelp bring seasonal variety to customers’ mealtimes.
Fresh produce and delicatessen are the strong points ofany successful supermarket, and MaxValu Kanto is always
seeking to fulfill customer desires in these areas. As part of thiseffort, delicatessen counters offer freshly made items throughout the day, especially for bento boxed lunches at lunchtime.
By meeting specific daily needs, the company strives to create
stores that regularly surprise our customers.
Main initiatives in fiscal year ended February 29, 2016

Improving fresh produce and prepared dishes toboost customer satisfaction“Reform” and “execution” have been the watchwords of MaxValu Kanto in trying to deliver greater customer satisfaction
with fresh produce and delicatessen. The layout of both these
sections has been rearranged to emphasize locally sourced
produce. In the delicatessen section, the company has also
forged relationships with new vendors and introduced new
products. On the sales side, the company has promoted special deals through “Tuesday Market,” offering a wider range offresh produce on that day.
With many overseas visitors to Japan increasingly doing
lots of shopping in the country, the company has opened aduty-free counter at the MaxValu Narita Tomisato store in thecity of Narita, Chiba Prefecture, near the international airport.
This sells items popular with foreign tourists, including Japanese teas, cereals and traditional confectionery. For Chiba residents, the company is promoting fish sourced direct from the
nearby port of Choshi and other local produce.
In the year ended February 29, 2016, the company createda new Sales Support Department to improve in-store operational capabilities and foster work practice reforms aimed atraising workplace productivity. Several stores were closed toboost business efficiency. Non-consolidated operating revenues decreased 3.5% in the year ended February 29, 2016, to¥47,721 million.

Growth Strategy

MaxValu Kanto Co., Ltd. Corporate Data
Head office

Kameido, Koto-ku, Tokyo

Established

December 2009

Capital

100 million yen

Number of stores

39 stores

Number of employees 1,994*As of February 29, 2016

Promotion of medium-term management policies
The medium-term management policies formulated and promoted by U.S.M.
Holdings are based on a four-pronged business strategy of “creating new
product value,” “creating new services,” “fostering people who will lead thenext generation,” and “improving business efficiency.” Ten project teams withmembers from each of the three group companies were formed in the year
ended February 29, 2016 to report to the Group Synergy Realization Committee on a range of synergy-creating initiatives. Joint purchasing is being pur-sued to lower the cost of goods for merchandise and in-store materials, andto reduce store refurbishment expenses. Joint promotional campaigns for thethree companies are also being used to stimulate growth in customer traffic.
The project teams are also looking at ways of using integration synergies tocreate original value from the three perspectives of Health, Community andValue. All of these initiatives are helping to reinforce the business base of
U.S.M. Holdings in the Tokyo region.

Medium-term management policies -- Creating original value from integration synergies -Creating
new productvalue

Creating
new services

Creating originalvalue
Fosteringpeoplewho will leadthe next
generation

Targetoperatingrevenue of
1 trillion yen

Operating revenue

Improvingbusiness
efficiency

1
trillion yen
750billion yen

720.0

663.8

billion yen

Feb. 2016

Feb. 2018(Target)billion yen

500billion yen
250billion yen
0Feb. 2021(Target)Strategy
Creating new product value and services
Assembled in March 2016, the Product Design Task Team is promoting the development and procurement of products to satisfy the needs of Kanto residents based on
detailed market research (including product information, customer needs and local
area knowledge). With the aim of giving customers healthy, valuable choices in food,the team is planning regular joint promotions and expanded food ranges to create
original merchandise value through our products.
Looking ahead, U.S.M. Holdings aims to promote ICT-based analysis of pooledmarketing data to yield intelligence on how to deliver greater convenience to customers via new services.

Training the next generation
As part of building and developing a new training
framework, U.S.M. Holdings also promotes intra-group personnel exchanges and skills development programs so the three operating companies
can gain better mutual cultural understanding andshare information on best practice with the aim ofdeveloping self-fulfilled employees who can contribute to local communities.

Improving business efficiency
To help improve the quality of management, the holding company is also promoting the centralization of functions such as public/investor
relations, legal affairs, accounting and finance. In March 2016, the ICT* Business Design Office was set up to oversee development ofplatforms for forging further synergies, rather than just using IT to raise efficiency. U.S.M. Holdings aims to achieve business efficiency
through such measures, while creating an enterprise that can continually evolve and grow based on close local community links.
*ICT: information and communication technology

78

CSR Activities

U.S.M. Holdings’ Basic Policy on the Environment
The United Super Markets Holdings Group recognizes that environmental problems constitute a critical global issue and■ Forest Conservation and Tree-Planting Activities■ ISO 14001 Certification

Maruetsu participates in the Musashino Forest Revitalization Project in
Saitama Prefecture, planting wild cherry and other trees at Maruetsu Forest (Maruetsu no Mori), located in Yokote, Hidaka City. Employees volunteer to clear undergrowth each spring and autumn as a forest conservation activity. Kasumi holds a tree-planting festival each May together withcustomers at Kasumi Empathy Creation Forest (Kyokan Sozo no Mori),
located in Kasama City, Ibaraki Prefecture. MaxValue Kanto engages in
activities to enhance the green space surrounding its stores.

Maruetsu and MaxValu Kanto are certified under the ISO 14001 international standard for environmental management systems. The companies
have set environmental targets applicable to all stores: reducing electricity and food waste, which have a particularly high environmental impact;
reducing combustible waste emissions (Maruetsu) and general waste
emissions (MaxValu Kanto); and increasing the number of customers declining bags (Maruetsu) and the percentage of customers declining bags
(MaxValu Kanto). The Group will continue environmental conservation
activities at all business sites as well as appropriate measures at businesssites that have obtained ISO 14001 certification.

makes concerted efforts to protect the global environment, helping to build a sustainable recycling society through soundbusiness activities that foster social and economic development and harmonious coexistence with local communities.

1. We actively work to conserve resources and energy through our business activities.
2. We work to develop and popularize environmentally friendly products and materials.
3. We promote waste reduction and The Three R’s: reuse, reduce and recycling.
4. We contribute to local environmental protection activities and strive for harmony with local communities.
5. We familiarize employees with this policy, nurture a spirit of environmental protection in each individual,
and engage in group-wide activities that involve all employees.
6. We announce this environmental policy to our employees and the public and strive toprovide information on our activities proactively.

The U.S.M. Holdings Group’s Main Initiatives
Environmental Impact Reduction and CO2 Reduction

9■ Recycling Activities■ Grocery Bag Reduction Activities

The Group companies install recycling bins at the front of each of theirstores and collect recyclable resources such as food trays, milk cartons,
and PET bottles. Kasumi, in particular, collects recycled resources at Recycling Stations installed at all stores and sorts and stores them at theKasumi Recycling Center, which performs primary processing. Kasumi
opened a new center in April 2016 withthe aim of establishing a more stable
recycling system.

With the cooperation of customers, Group companies engage in activities to reduce the use of disposable plastic grocery bags. Maruetsu
awards T-Card users who decline plastic shopping bags two T-Points as“eco points.” Kasumi applies the proceeds from the sale of plastic grocery bags at stores that have stopped distributing bags free of charge toenvironmental protection
and other worthy causes.
MaxValu Kanto collects
used plastic grocery bags
from customers for use bycustomers who do notbring their own reusable
shopping bags.

■ Raising Employee Awareness of Waste Reduction■ Carbon Offsetting

To raise employee awareness of the importance of waste reduction, Maruetsu has
introduced at more than 200 supermarkets, mainly its eponymous stores, a waste
weighing and management system thatquantifies the amount of waste discharged.
By quantifying waste discharged from its
stores, Maruetsu is working to curtail
waste emissions by increasing employee
commitment to waste reduction.

Maruetsu engages in a carbon offset initiative to offset CO2 emitted in the
manufacture of the plastic grocery bags it provides for customers, purchasing the right to emit CO2 equivalent to theamount absorbed in forest conservation activities conducted by Iwate Prefecture, Tome City in
Miyagi Prefecture, and Kitakata City in Fukushima Prefecture. In addition to contributing to
global warming mitigation, this initiative also supports environmental protection activities and local communities in areas that were stricken by
the Great East Japan Earthquake.

Safety and Security Initiatives■ Voluntary Inspections for Radioactive Substances■ ISO 22000 and ISO 9001 Quality Management Certification

The Group has put in place an inspection system for radioactive substances to enable customers to purchase food products with confidence
and peace of mind. Maruetsu and Kasumi conduct voluntary product inspections and disclose on their websites theresults of sampling inspections of fresh
produce, milk, tofu, and other products.

Maruetsu has obtained certification under the ISO 22000 international
standard for food safety management systems at its fresh food processing centers for fresh meat and fresh fish and attests that it provides customers with safe, high-quality food products. Rose Corporation Co.,
Ltd., a Kasumi Group company that produces and processes boxedlunches and prepared foods, has obtained certification under the ISO
9001 international standard for quality management systems and engages in rigorous quality control that ensures customer peace of mind.

Contributions to Society■ Support for Guide Dog Training■ Great East Japan Earthquake Reconstruction Assistance

The Group supports guide dog training through monetary donations andconducts events such as guide dog training center tours for customers.
Maruetsu has continuously made donations to the Japan Guide Dog Association (JGDA) since 1993 through activities to raise funds for guide dog
training, and the cumulative amount donated by fiscal 2015 was approximately 250 million yen. Kasumi periodically holds meetings of the Kasumi
Guide Dog Friends Club (Kasumi Modoken Friend Club) with JGDA support to deepen community understanding and support for guide dogs.

Since the Great East Japan Earthquake of 2011, Kasumi has continuously engaged in activities to assist the city of Rikuzentakata, which was devastated inthat disaster. It conducts companywide charity activities based on a reconstruction assistance calendar and donates the money collected to the Rikuzentakata
Elementary and Junior High School Reconstruction Fund. In March 2016, some
300 persons participated in Rikuzentakata Tanabata Festival Experiential Learning (Rikuzentakata Tanabata Matsuri Taiken Gakushu), an event held for fiveconsecutive years since 2012 coinciding with a donation presentation ceremony. At the time of the Tanabata Festival, held on August 7 each year, elementary
school students from areas where stores are located and new Kasumi employees visit Rikuzentakata for two nights and three days to view the current situationin the disaster-stricken area and learn about the strength and wisdom to survive
from the personal stories of victims. By joining in the Tanabata Festival andpulling floats together with the local people, the participants deepen their interactions with others and learn the importance of bonds between people.

Photo credit: Japan Guide Dog Association■ Energy Conservation■ Fundraising Activities

Kasumi actively utilizes renewable energy, using solar power to generatepart of the energy required for its stores. The company generates solar
power at 23 stores and sells 4.18 million kWh of electricity per year to
power companies.
In addition, the Group companies install LED lighting, which combines low
power consumption with a long service life. They reduce the environmental
impact by using LED lighting for refrigeration equipment and installing dimmable lighting. They work to curtail electricity use at individual stores by, for example, installing night covers and nighttime shutoff timers on refrigeration cases.

Maruetsu, Kasumi, and MaxValu
Kanto participate in Nippon Television’s 24-Hour Television: “Love
Saves the Earth” charity television program.

Solar power generation

Use of LED lighting and natural light■ Collection of PET Bottle Caps to Purchase Vaccines
The Group companies collect PET bottle caps at their stores and donate
the proceeds from the sale of the caps to the Japan Committee, Vaccines for the World’s Children (JCV) for use in purchasing vaccines forchildren around the world. (Some stores do not participate.)

10Corporate GovernanceConsolidated Financial Statements (As of February 29, 2016)

Corporate GovernanceConsolidated Balance Sheet

Basic Policy on Corporate Governance⑴ Respect the autonomy and independence of the operatingcompanies and ground corporate governance in the basic
principles, vision, and mission formulated at the time theCompany was established based on the common principles“Customer-first” and “Contribution to local communities.”⑵ Maintain transparency and fairness in decision-making toensure appropriate cooperation with shareholders andother stakeholders.
⑶ Regard shareholders with whom appropriate cooperation
can be achieved from a medium- and long-term perspective, particularly customer shareholders who provide opinions through their daily shopping, and other stakeholders
as important partners. Create an environment that enables
constructive dialogue with these stakeholders and develop
a framework to reflect their feedback in management.
⑷ On the basis of (1) to (3) above, demonstrate a healthy
entrepreneurial spirit by ensuring rationality in the management decision-making process and strive for theCompany’s sustained growth and enhancement of medium- and long-term corporate value by realizing promptand decisive decision-making.

Board of Directors

Account

The Board of Directors consists of nine directors (including
three outside directors). The Board meets once a month, inprinciple, and holds extraordinary meetings as necessary. The
five Audit & Supervisory Board members attend Board of Directors meetings. At Board meetings, the directors deliberate andresolve matters prescribed by law and matters set forth in the
Board of Directors Regulations and oversee the execution ofbusiness by the directors on the basis of regulatory complianceand appropriate risk management. As a pure holding company,
the Company requires the operating companies to report to theCompany important resolutions and governs the appropriate
execution of business operations by the operating companies.

Audit & Supervisory Board
The Audit & Supervisory Board consists of five corporate auditors (including three outside corporate auditors). The Board
meets once a month, in principle, and holds extraordinary
meetings as necessary. At Board meetings, the corporate auditors receive reports on, discuss, and resolve important audit-related matters. The corporate auditors audit the legality ofthe execution of duties by the directors, the status of assets,
and other matters in accordance with the audit policy anddivision of duties established by the Audit & Supervisory
Board. The Audit & Supervisory Board convenes meetings ofthe Group Auditor & Supervisory Board Liaison Committee forthe purpose of cooperating with the corporate auditors andinternal audit departments of the operating companies, strives
to ensure highly effective auditing, and works to reinforce thegovernance function and internal audit function.

Corporate Governance Structure(As of May 19, 2016)

General Meeting of Shareholders

Accounting auditor/Audit corporation

Audit &
Auditing
Supervisory Board(Corporate auditors)

Collaboration
ReportingAccounting auditing
Collaboration

Auditing

President andRepresentative
Director

Collaboration

Audit & Supervisory
Board Committee(Group corporate auditors)

ReportingInternal
Internal Audit Department auditing
・Internal control
・Auditing
ReportingOversight/
Policy reinforcement

Management
Council
Resolution/
Approval

ReportingCorporate departments

Management guidanceApproval of important matters

Corporate auditors/
Audit departments

11

Board of Directors(Directors)

Oversight Election/
Dismissal

ReportingAssetsCash and deposits
Notes and accounts receivable - trade

AmountCurrent liabilitie
29,471
419

Notes and accounts payable - trade47,030Current portion of long-term loans payable

3,900

Income taxes payable

3,641
1,795

Inventories

16,244

Provision for bonuses

Accounts receivable - other

17,046

Provision for loss on store closings

235

Provision for shareholder benefit program

256

Deferred tax assets

2,184

Other

2,722

Provision for doubtful accounts（169）

Total current assets

67,920Non-current assets
Property, plant and equipment
Buildings and structures, net

60,020

Land

Other

22,981

Total current liabilities

79,841

Non-current liabilities
Long-term loans payable

25,700

Deferred tax liabilities

163

Provision for directors' retirement benefits

365

Provision for loss on subleases

211

Net defined benefit liability

2,365

42,344

Asset retirement obligations

4,580

Other, net

17,919

Other

9,115

Total property, plant and equipment

120,284

Total non-current liabilities

Goodwill

15,482

Other

2,239

Total intangible assets

17,722

Total liabilities

Investment securities

7,398

Deferred tax assets

5,215

Guarantee deposits

34,210Other

42,500122,342

Net assets
Shareholders' equity
Capital stock

10,000Capital surplus

104,319

Retained earnings

Investments and other assets
Resolution/
Approval

Account

Liabilities

Current assets

Treasury stock
Total shareholders' equity

16,595（7）
130,907

Accumulated other comprehensive income
Valuation difference on available-for-sale securities

（205）

1,648

Foreign currency translation adjustment

323

Provision for doubtful accounts（392）

Remeasurements of defined benefit plans

144

Total investments and other assets

48,079Total accumulated other comprehensive income

263

Total non-current assets

Subsidiaries

AmountIntangible assets

Election/Dismissal
Oversight(Millions of yen)

Total assets

186,086
254,006

Minority interests

493

Total net assets

131,664

Total liabilities and net assets

254,00612

Consolidated Financial Statements (Fiscal year ended February 29, 2016)

Consolidated Statement of Income (Millions of yen)Account

Amount649,539

Cost of sales

466,344

Gross profit
Operating revenue

Stock Informaation

EstablishedMarch 2015

Number of shares authorized

500,000,000 shares

Capital10 billion yen

Number of shares issued

131,681,356 shares

Number of shareholders

57,306

16,107

Business

Management of supermarket business

183,194

Cash flows frominvesting activities（16,897）

Head office

1 Kanda Aioi-cho, Chiyoda-ku, Tokyo

14,259Cash flows fromfinancing activities（3,910）

197,454

Selling, general and administrative expenses

183,430
14,024Non-operating income

Effect of exchange rate change on
cash and cash equivalents（55）

Net decrease in cash andcash equivalents（4,755）Interest income

97

Cash and cash equivalents
at beginning of period

20,481Dividend income

55
116

13,744

Subsidy income

Increase in cash and cash equivalents
resulting from share transfer

Other

295

Cash andcash equivalents at end of period

29,470Total non-operating income

565

Non-operating expenses

Major Shareholders

Group Companies

Supermarket business for retail sales of foods,
household goods, apparel, etc.
Head office: 5-51-12 Higashi-Ikebukuro, Toshima-ku, Tokyo
Business

Kasumi Co., Ltd.

Supermarket business for retail sales of foods,
Businesshousehold goods, apparel, etc.
Head office: 599-1, Nishiohashi, Tsukuba-shi, Ibaraki Prefecture
MaxValu Kanto Co., Ltd.

Supermarket business for retail sales of foods,
Businesshousehold goods, apparel, etc.
Head office: 5-30-3 Kameido, Koto-ku, Tokyo

233

Directors and Corporate Auditors(as of May 19, 2016)

Share of loss of entities accounted for using equity method

137

Repayments of compensation received

93

Other

262

Total non-operating expenses

727

Chairman and Representative Director
President and Representative Director
Representative Director
Director and Executive Vice-President
Director
Director and Advisor (part-time)
Outside Director (part-time)
Independent Outside Director (part-time)
Independent Outside Director (part-time)
Corporate Auditor (Standing)Corporate Auditor (Standing)Outside Corporate Auditor (part-time)
Outside Corporate Auditor (part-time)
Independent Outside Corporate Auditor (part-time)

Hiromasa Kohama
Makoto Ueda
Daisuke Tezuka
Motohiro Fujita
Ryota Furuse
Motoya Okada
Mitsuru Akiyoshi
Shigekazu Torikai
Naoko Makino
Kazuo Hosoya
Tsutomu Uchida
Akira Sasaoka
Masahiro Miyatake
Shinobu Okamoto

13,862Extraordinary income
Gain on sales of non-current assets

264

Gain on sales of investment securities

0

Total extraordinary income

264

Extraordinary losses
Impairment loss

235

Loss on store closings

210

Loss on sales of investment securities

12

Income before income taxes and minority interests

Percentage ofshares held(%)

Aeon Market Investment Co., Ltd.

67,15951.00

Kasumi Business Partners Shareholding Association

2,859

2.17

The Kambayashi Scholarship Foundation

2,300

1.75

Japan Trustee Services Bank, Ltd. (Trust Account)

2,178

1.65

Aeon Co., Ltd.

1,629

1.24

Nippon Life Insurance Company

1,531

1.16

Nippon Access Inc.

1,473

1.12

The Master Trust Bank of Japan, Ltd. (Trust Account)

1,343

1.02

KOKUBU GROUP CORP.

1,099

0.84

Mitsubishi Shokuhin Co., Ltd.

1,073

0.82

Note: Percentages of shares held are calculated excluding 6,674 shares of treasury stock.

Distribution of Shares by Shareholder Type
Foreign corporations etc.

4.29％

Securities ﬁrms

0.12％

Financial institutions

10.33％

Treasury stock

0.01％
Individuals and other

19.92％

Other Japanese corporations

65.33％

2,734

Provision of allowance for loss on store closings

Total extraordinary losses

Number ofshares held
(thousand shares)

Shareholder name

The Maruetsu, Inc.

Interest expenses

Ordinary income

13

AmountCorporate Data

Cash flows fromoperating activities

Operating gross profit

Operating income

Consolidated Statement of Cash Flows (Millions of yen)Account

Net sales

Corporate Data and Stock Information (As of February 29, 2016)

3,192
10,934

Income taxes - current

5,553

Income taxes - deferred

202

Total income taxes

5,756

Income before minority interests

5,177

Minority interests in loss

（151）

Net income

5,329

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united super markets holdings inc.

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Stock Exchange Code: 3222

1 Kanda Aioi-cho, Chiyoda-ku, Tokyo 101-0029, Japan
TEL: +81-3-3526-4761
URL: http://www.usmh.co.jp/