Analyst meeting for
Nursing Care and Childcare
Business (Company)
September 14, 2022
Benesse Holdings, Inc.

This presentation contains forward looking statements concerning the future plans, strategies, beliefs and performance of Benesse Holdings, Inc. and its subsidiaries. These
forward looking statements are not historical facts. They are expectations, estimates, forecasts and projections based on information currently available to the Company and are
subject to a number of risks, uncertainties and assumptions. As such, actual results may differ materially from those projected.

Business Description
Benesse Group Business Description
Overview

Education Business in Japan 49.1%

Nursing Care and Childcare
Business 29.5 %Main Businesses/Services

Shinkenzemi
School & teacher support
Prep schools/Classrooms

Affliated Companies
Benesse Corporation
Tokyo Individualized Educational Institute, Inc.
UP Inc.
Tokyo Educational Institute Co., Ltd. (Tetsuryokukai)
Ochanomizu Seminar Co., Ltd.
Shinken-AD Co., Ltd.
Benesse i-Career Co., Ltd.
Benesse BE studio Inc.
Classi Corp. others

Main Businesses/Services

Net Sales

431.9
Billion yen
FYE March 2022






Nursing home care
Meal delivery, nursing careconsultation
HR recruitment & dispatch fornursing and care staff
Daycare and afterschool childcare

Affliated Companies
Benesse Style Care Co., Ltd.
Benesse MCM Corp.
Heart Medical Care Co., Ltd.
Benesse Palette Co., Ltd.
Benesse Senior Support Co., Ltd.

Others 0.3%
Berlitz 4.6%

Kids & Family Business 16.5%
Main Businesses/Services

Note: Regarding Berlitz Corporation, as a result of the share transfer on February 14, 2022,
Berlitz is not included in the fourth quarter results of the consolidated accounting period.






Kodomo Challenge
Pregnancy, Childbirth, and Child-Rearing
LifestylePet

Affliated Companies
Benesse Corporation
Benesse Corporation China
PT. Benesse Indonesia
others
As of end of March 20221

(1) Overview of the Nursing Care and Childcare
Business (Company)
・Overview and Background・Our Philosophy
・Business Model(2) Medium-to-Long Term Strategy and Future Vision(3) Profitability・Capital Efficiency

Overview and BackgroundOverview of Nursing Care and Childcare Business (Company)
Nursing Care and Childcare Business Company combines Benesse Style Care Co., Ltd. and
4 affliate companies to offer nursing care,daycare and afterschool childcare business, andother peripheral business in the field of nursing care.
Director and Senior Managing Executive Officer, Head of the Nursing Care and Childcare Business Company
Representative Director and President of Benesse Style Care Co.,Ltd.
Shinya Takiyama

Nursing Care, Daycare, AfterschoolChildcare BusinessNursing Care Peripheral Businesses

Benesse Palette Co., Ltd.

Benesse Style Care Co., Ltd.
・Nursing home care service, seniors housing
・Home help services
・Childcare and afterschool

Nursing Care and Childcare
Business Company

Representative Director and President
Takeshi Iwaida

・Meal delivery service to the elderly
・Catering service for elderly homes and housing

Benesse Senior Support Co ., Ltd.
・Nursing care consultation service

Representative Director and President

Yasuhiko Honma

Representative Director andExecutive Vice President
Masato Kosugi

・B2B support for nursing and care staff retention

Benesse MCM Corp.
・Medical and nursing care recruitment & dispatch

Representative Director and President

Yoko Fukazawa

Head of Childcare and afterschool
Business
Takako Sakuma

Benesse Holdings Subsidiary

Heart Medical Care Co., Ltd.

・HR recruitment and dispatch services for medical, nursing, and welfare fields;

nursing care industry news services
・Sale and rental of nursing care equipment (subsidiaries: Marufuji Co., Ltd.,
Representative Director and President Silverheart Co., Ltd.)
Koji Ito4

Changes in the Business from the Start to Present
Growth is mostly attributed to an increase in facilities offering nursing home careservices and the expansion into other business fields. FY2019～FY2021 results wereaffected by COVID-19
1,274
127.3
＊Net sales and operating income are the combined total amount for Nursing Care and Childcare Business Company.
Net Sales: External net sales, Operating income: Before royalty payment＊

589
58.8

3.8
39

4

7.1
71

13
30

-2.1
-21

47

-11
-1.0

12.1
121

16

61

0.4
5

16.7
168

18

73

16
1.6

32.0
27.4 321
274
22.8
228

18
21
92
20
2.0

18
22
106
1.9
19

446
40.3 44.6

37.1 404
371

19
21
115

19
20
129

20
20
139

2.5
25

2.6
27

2.6
26

23
19
150
3.0
30

24
19
204
41
4.0

665
66.5
24
19
224
4.6
47

79.5
796
73.9
739

26
22
238
4.8
49

31
26
253

5.8
59

87.2
873

1,118
1,030
102.9 111.8

1,170
116.9

123.8
122.8 1,238
1,229

Net Sales（Unit: billion yen）

950
94.9

1
36
34
276

5.6
56

5
40
34
292

7.0
70

12
45
39
308

23
50
39
316

8.1
82

8.8
89

27
53
39
322

27
57
40
330

28
60
37
339

11.3 10411.3 114
114
10.3

31
62
37
343

8.0
80

Office / Facility
Afterschool childcare
Nursery schools
Home help
Nursing home care

Operating income（Unit: billion yen）

Affected by COVID-19

FY 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Nursing
Care
Peripheral
in the fieldof nursing
care
Main businessshown in ( )Daycareandafterschool
childcare

Nursing Care Business (started in FY1995 as part of Benesse Corporations. In FY2000, Benesse Care Corp. established and Shinkoukai Co., Ltd becomes a subsidiary.
In FY2009 Bon Sejour Corp. becomes a subsidiary.
Benesse MCM Corp. (Established FY2002) (HR recruitment/dipatch)Proto Medical Care Co., Ltd. (now Heart Medical Care Co., Ltd.) (Became a subsidiary FY2021)(HR recruitment, nursing care industry news service)
Benesse Palette Co., Ltd Corp. (Established FY2013)(Food delivery service)
Benesse Senior Support Co ., Ltd.
(Established FY2014) (Nursing care consultation)
Childcare Business (Started in FY1994 as part of Benesse Corporations. Moved to Benesse Style Care Co., Ltd. in FY2004.)
Afterschool Childcare Business (Starts FY2014)

5

Change in Ratio of Net Sales for Nursing Care and Childcare Business
Ratio of Nursing Care and Childcare Business in the Group is expanding.
Ratio of Nursing Care and Childcare Business net sales to consolidated net sales

FY2010
14.3％

Nursing Care and Childcare

Net Sales: 58.8 billion yen

FY2021
29.5％

Nursing Care and Childcare

Net Sales: 127.3 billion yen
6Our Philosophy

Purpose (Nursing Care)

Aiming to improve QOL for the elderly
by pursuing a service that
“Provides what you want for yourself or your family”

We believe that improving QOL means
bringing the person closer to the life way they want to live
(a life of dignity.)
As we work to make that a reality
we prioritize having a deep respect for people’s individuality.
In addition, by providing our Group's services to the local community,
seniors can continue living a life that suits them in a familiar environment,
enabling us to contribute to creating a society where
people grow happier as they grow older.
8

Expansion of Operation From Nursing Home Business, to Providing Various
Solutions for Issues Related to Nursing Care
■Providing support that helps people who require care or have dementia to find areason for living.

Positioning nursing homes as a place of hope for families who have reached their limit with caring for loved ones
at home.

■Leveraging our unique experiences and knowledge gained from providing roundthe clock care 365 days a year
Caring for 17,000 residents serves as a source for new ideas and solutions.

■Offering mutual agreement contracts that allow customizing of services andproducts within long-term care insurance cover

Reducing dependence on long-term care insurance gives the potential for price competitiveness■Using our hands-on experience as a Nursing Care Business to understand thereal needs of peripheral businesses

For example, introducing client-friendly pricing system* for HR recruitments businesses.

■Japan’s role as one of the first developed countries to face declining birthrate
and aging population.
Experience and knowledge gained in Japan can help tackle these issues as they emerge in other countries.
*Note: This system delays payment of the referral fee until the worker has been in position for one month in order to protect clients from the nursing care industry’s high rate of turnoverin the first few weeks of employment.”

9

Business Model・Nursing Care Business・Daycare and Afterschool Childcare BusinessNursing
Care
Business

Outline of Benesse Nursing Care Services(Development of community-based services）

Rooted in community and supporting seniors with various backgrounds
Related company:
Benesse Style Care Co., Ltd.

Related company:
Benesse Palette Co., Ltd.

Related company:
Benesse Style Care Co., Ltd.

Nursing homes andhome help services

Seniors housing

Meal delivery service

ｰｰｰｰｰ
ｰｰｰｰｰ
・・・

Total Seniors Living
Related company:
Benesse Style Care Co., Ltd.

Home care business

Related companies:
Heart Medical Care Co., Ltd.
MARUFUJI
SILVER HEART

To live in a familiar environment
until the end, in a way thatsuits seniors

Medical equipment rentals
and sales
Recruitment and dispatch
business for
Nursing care andmedical staff

Nursing care consultation
services

Nursing care zero turnoversupport services

Related companies：
Benesse Senior Support Co., Ltd.
Heart Medical Care Co., Ltd.

Related company：
Benesse Senior Support Co., Ltd.

Related companies：
Benesse MCM Corp., Heart Medical Care Co., Ltd.

11

Nursing
Care
Business

Outline of Nursing Homes

Facilities expansion focused on urban centres. Residents range from healthy people
to those certified as requiring long-term care.
Facilities (As of June 30, 2022)

 346 senior citizen nursing homes inoperation• 341 private-pay nursing homes(of these, 262 facilities with nursing care, 79 residential
facilities )• 2 group home facilities• 1 care house• 2 nursing homes with care services

Residents (As of June 30, 2022)■Residents: Approximately 17,000■Average age: 89.2 years■Female 80%、Male 20%■Nursing care level (see pie chart below)

・Used by people with a wide range of nursing care needs
Others, pending, 0.6％

 Expansion in 13 prefectures, mainlyin Tokyo metropolitan area
• Northern Japan: Hokkaido, Miyagi Prefecture• Tokyo metropolitan area: Tokyo, Kanagawa, Chiba, andSaitama• Tokai: Aichi• Western Japan: Osaka, Hyogo, Kyoto, Nara, Okayama• Kyushu: Fukuoka

Longterm
Carelevel 5
11.0%

Independent

3.1％

Support Care Level 1 8.8％
Support Care Level2
6.5％

Long-term Care level 4
15.6%

Long-term Care level 3
15.5%

Long-term Care level 1
21.6%
Longterm
Carelevel 2
17.2%

12

Features of Our Nursing Care BusinessNursing
Care
Business(Facility Development by Prefecture)

Number of elderly people expected to increase in the long term, developing facilities mainly in
the Tokyo metropolitan area, Nagoya, and Kinki region where many wealthy people reside

Facilities by prefecture

2015～2020 Population growth rates by prefecture
2015~2020 Top 28 prefectures by population growth rate (to Nara, where the company has facilities)

2015～2020
人Prefectures whose populations increased

Prefectures where theCompany operates

Population change %Prefectures where future
development is planned

2015～2020
Population increased

2015～2020
Population decreased

Hokkaido

Nara

Kumamoto

Gifu

Kagawa

Saga

Mie

Fukui

NaganoTochigi

Ishikawa

Shizuoka

Gunma

Okayama

Ibaraki

Hiroshima

Hyogo

Miyagi

Kyoto

Shiga

Osaka

Fukuoka

Aichi

Saitama

Chiba

Kanagawa

Tokyo

Okinawa

1

Tokyo

2

Okinawa3

Kanagawa

4

Saitama

5

Chiba

6

Aichi

7

Fukuoka8

Shiga(As of June 30, 2022)
346 facilities in 13 prefectures.
Of these, 264 (76.3% of total) are in Tokyo metropolitan area
Hokkaido (Sapporo City)
2 facilities
Main criteria for facility development
・ Number of elderly wealthy
households, density, changes
・ Elderly population trends
・ Possibility of dominance・ Other strategic factors (hiring
strategy, etc.)

Compiled based on 2020 census results (Statistics Bureau of Japan https://www.stat.go.jp/data/kokusei/2020/index.html）

Population over 75 years old by prefecture
future estimate

Top 15 prefectures ranked by population over 75

Top 15 prefectures ranked by estimate of population over 75 in 2040

2020

2030

2040

NiigataMiyagi

Kyoto

Hiroshima

IbarakiShizuoka

Fukuoka

Hyogo

Hokkaido

Chiba

Aichi

Saitama

Osaka

Kanagawa

Tokyo

Compiled based on The National Institute of Population and Social Security Research’s “ Japan’s Future Population Estimates by Region(2018 Estimates)s”（https://www.ipss.go.jp/pp-shicyoson/j/shicyoson18/3kekka/Municipalities.asp）

1

2020

2030

2040

Tokyo

Tokyo

Tokyo

2

Osaka

3

Kanagawa

4

Saitama Saitama Saitama

Kanagawa Kanagawa

Osaka

Kinki region 51 facilities
Hyogo Prefecture 24 facilities
Osaka metropolitan area 18 facilities
Okayama Prefecture 4 facilities
Kyoto Prefecture 3 facilities
Nara Prefecture 2 facilities

Osaka

5

Aichi

Aichi

Aichi

6

Chiba

Chiba

Chiba

7

Hokkaido

Hokkaido

Hokkaido

8

Hyogo

Hyogo

Hyogo

9

Fukuoka Fukuoka Fukuoka

10

Shizuoka Shizuoka Shizuoka

11

Hiroshima

12

Tochigi

IbarakiMiyagi Prefecture (Sendai City)
5 facilities

Ibaraki

Hiroshima Hiroshima

13

Kyoto

Kyoto

Kyoto

14

Niigata

NiigataMiyagi

15

NaganoMiyagi

Niigata

Fukuoka Prefecture (Fukuoka City)

2 facilities
Tokyo Metropolitan Area 264 facilities

Aichi Prefecture(Nagoya City Centre)
22 facilities

Tokyo 163 facilities
Kanagawa Prefecture 63 facilities
Saitama Prefecture 24 facilities
Chiba Prefecture 14 facilities

13

Nursing
Care
Business

Features of Our Nursing Care Business（Dominance in Tokyo metropolitan area）
Among facilities mainly in the Tokyo metropolitan area,
Benesse has an overwhelmingly dominant position particularly in Setagaya Ward.
Tokyo metropolitan area facilities by municipality

Example of dominance

Setagaya Ward
(As of June 30, 2022)★ Municipalities with 10 or more facilities■ Municipalities with 5~9 facilities▲ Municipalities with 2～4 facilities

Saitama Prefecture 24 facilities● Municipalities with only 1 facility

13
1
Satte
1
Kawaguchi 6
Soka
2
Warabi1

Chiba Prefecture 14 facilities

Saitama
Toda

5
3
3
1
1
1

Ichikawa
Chiba
Funabashi
NarashinoMatsudo
Noda

Kanagawa Prefecture 63 facilities
Yokohama
KawasakiFujisawa
Kamakura
Hiratsuka
YamatoSagamihara
Chigasaki
HayamaZushi
Hadano

21
20
8
4
2
2
2
1
1
1
1

Tokyo 163 facilities
Setagaya 32
Nerima15

Suginami

12

Ohta

11

Itabashi

8

Meguro6

Shinjuku

5

Shibuya

4

Kita

4

Shinagawa3

Minato3

MitakaKoganei2

Katsushika

3

7MachidaMusashino

3

7

Edogawa2

Fuchu

Kunitachi

Bunkyo

2

5

1

Chofu

KodairaNakano

2

4

1

Komae

KiyoshiToshima2

4

1

Kokubunji

Chiyoda1

1

3

Hachioji

Taito

NishiTokyo

Hino

1

3

1

Sumida1

Tama

3◆Nursing care related locations
・ Private-pay nursing homes

32 facilities

・ Nursing care centers(in-home care)

3 locations

・ Day service

2 locations

・ Food delivery for the elderly

1 location

・ Medical equipment rental and sales

1 location◆Private-pay nursing home share
Share
by # of facilities
施設数シェアBenesse32％

Share by capacity
定員数シェアBenesse

28％

7％
5％

Source: Tamura Planning & Operating “Seniors Housing Data 2022” and in-house survey (as of June 30, 2022)

7％
6％

14

Nursing
Care
Business

Features of Our Nursing Home Business(Private-pay nursing home brands)
Offering broad selection of private-pay nursing homes to suit a variety of budgets

Number of facilities as of June 2022. Excludes care houses, Li-Re (assisted-living residence), group homes.

High-end
Monthly equivalent:over 550,000 yen

Aria
27 homes

Granny&GrandaMid-range
Monthly equivalent
Between 200,000 and 550,000 yen

Bon Sejour

157 homesClara
35 homes

Madoka57 homes

50 homes

Cocochi
15 homes

Low-endMonthly equivalent:less than 200,000 yen
Fee example for each brand*1
Occupancyfee BasedContract
Monthly-fee
BasedContract＊Monthly equivalent: Occupancy fee divided by 60 months plus monthly fee, assuming equal amortization of the occupancy fee over 5 years.
Aria Fukuzawa(Type A)

Granda Futagotamagawa Bon Sejour Minami Urawa(Type A1)

(Type A/Basic)

Clara Miyamaedaira

Madoka Musashi-Shinjo

Cocohi Noda
(Type A/Basic)

Standard admission*2

29,000,000 yen

10,800,000 yen

6,680,000 yen

ーー

2,970,000 yen

Monthly Fee (example) (taxincl)*3

314,430 yen

267,310 yen

224,599 yenーー

190,817 yen

Deposit *4

3,306,000 yen

1,231,200 yen

1,171,800 yen

660,000 yen

720,000 yen

687,000 yen

Monthly Fee (example) (taxincl)*3

865,430 yen

472,510 yen

359,899 yen

361,910 yen

287,210 yen

240,317 yen*1 Example fee for Nursing Care Level 1 resident in a private-pay nursing care home.
*2 A person aged 75 or over at time of admission.

Fee examples are as of September 2022.
*3 Monthly fees include food, maintenance, and other costs. Other expenses include long-term care insurance contributions.
*4 The full amount is to be returned at the end of the contract.

15

Nursing
Care
Business

Revenue Structure of Private-Pay Nursing Homes（per location）

The main focus is the private-pay nursing home business with low dependence on
long-term care compensation

Sales

Monthly usage fees

Long-term care compensation

Depositamortization

Approx. 45%

Approx. 35%

Approx. 20%(Rent, meals, management fees, etc.)

Labour and personnel costs

Expenses

Approx. 45%

Facility
expenses

Other expenses(Rent, depreciation,
repairs, etc.

(Utilities, consumables,
Kitchen outsourcing,etc.)

Approx. 15%

Approx. 20%

Operating income(Before pro-rata head
office expenses)

Approx. 20%% of sales

16Childcare
Business

Features of Our Daycare and Afterschool Childcare BusinessChildcare that fosters the power to learn so children can live in society in an age of
uncertainty
Daycare BusinessFeatures of Benesse’s daycares

4 environments x 4 relations
Teachers’ careful approach

Create an environment

TimeLife with a vision of
the future

PeopleAssigned person in charge,
mixed age groups

Afterschool Childcare Business

Space

Wait &
watch

Accept× FindPlay & Life
Comfortable place tofeel at home

Mainly licensed daycares in Tokyo metropolitan
area where the need for childcare is great (92% of total)# of daycares in operation

65(As of June 30, 2022)

By prefecture

Kanagawa
23 (35％)

Hyogo 2
Chiba 1
Saitama 1

By type

Unlicensed 5

Tokyo
38 (58％)

Of which 33
within 23 wards

Licensed daycares
民設民営(認可)60 (92％)
50施設
(77％)

Create a rhythm oflearning and play

Making a habitof learning

Learning throughexperience

Supporting the fun of learning

Encourage

Learn from playing

Features of Benesse’s
childcare clubs

×

Variety of formative experiences
and immersive programs toshape childrens’ future

In metropolitan area (Tokyo 79%) where there are waiting lists, all private childcare clubs
operate as a Class II social welfare service

34# of childcare clubs in operation(As of June 30, 2022)

By typeBy prefecture

Kanagawa 5
Chiba 2

Tokyo
27(79％)Of which 22 facilities
in Bukyo

PrivateOperations
childcare Outsourced
facilities 19 (56％)
15 (44％)17

(1) Overview of the Nursing Care and Childcare
Business (Company)(2) Medium-to-Long Term Strategy and Future Vision
・Nursing Care Business environment
・Nursing Care Business growth strategy
・Daycare and Afterschool Childcare Business growth strategy(3) Profitability・Capital Efficiency

Nursing Care Business Environment

Elderly Population
The over 85 population, the main target of nursing homes, will increase until 2060.
The increase is projected to be greater in municipalities where we operate private-pay nursing homes
than the national rate of increase.
Over 75 population
Over 75 population will peak in 2055

Generation Y

24.46

22.88

137%

11.52
1,152

Baby boomers

Baby boomers

The Company is building private-pay
nursing homes in municipalities where growth rates
are projected to surpass the nationwide growthOver 85 population will peak in 2060
Unit: million people)

Generation Y(Unit: million people)

Over 75 population growth rateestimate

Over 85 population

10.24
1,024

Over 85

Estimated over 75 population growth rate
in municipalities where the Company
operates private-pay nursing homes

125%

Estimated over 75 population national
growth rate

75 ～84

Over 85

2000 2005 2010 2015 2020 2025 2030 2035 2040 2045 2050 2055 2060 2065

100％

2020

＊2000～2020 population based on the Statistics Bureau of Japan’s “Population Census Results”＊Estimates for 2025 and beyond are based on the National Institute of Population and Social Security Research’s “Japan’s Future Population Estimates” (2017 estimates)

2025

2030

2035

2040

2045

20

Shortage of Nursing Care Personnel
Shortage of nursing care personnel is becoming more serious
Active jobs-to-applicants ratio
20

15

Required number of nursing staff (forecast)
Number of nursing care staff

18.36【Industry: Nursing care services】

Required number of nursing care staff (estimate）

280万人
2,800

（Unit: thousand people)

23 wards, part time

11.59

11.37

10
23 wards, full time employees
National, part time

50

2012/7

2,330
233万人

8.02

6.20

4.47
3.21

3.99

2,430
243万人

（690）

（320）

211万人
2,110

（220）

National, full time employees Period：July 2012~July 2022
2013/7

2014/7

2015/7

2016/72017/7

2018/7

2019/72020/72021/72022/72019
FY2019年度

2023
FY2023
年度

2025
FY2025年度

Sources: (left graph) Compiled from the Ministry of Health, Labour and Welfare’s “Employment Referrals for General Workers” and Tokyo Hello Work’s “Active Job Openings and Job Search Conditions by Occupation”(right graph) Compiled from the Ministry of Health, Labour and Welfare’s “8th Long-term Care Insurance Business Plan”

2040

FY2040年度

21

Benesse’s ShareThe nursing industry is an ultra-long tail market. Our market share is still low.
Largest share of number of high-end private-pay nursing homes in urban areas.
Share of nationwide private-pay nursing homes(with nursing care + residential type)
Share by number of facilities
Benesse 3.3％

Share by number of capacity
Benesse 2.2%

Total of the top 5
companies* 12.3％

Total of the top５
companies* 7.1％

Others 87.7%

Others 92.8%

All business operators# of operators：7,815# of facilities ：15,537# of capacity ：597,538

Source: Tamura Planning & Operating “Seniors Housing Data 2022” and in-house survey (as of May 31, 2022)

Share of high-end private-pay nursing homes（with nursing care＋residential type）

Tokyo, Nagoya, and Osaka regions（Tokyo, Kanagawa, Chiba, Saitama, Osaka, Hyogo, Aichi）# of operators：133 # of facilities：483 # of capacity：46,553

Benesse22.6%＊High-end：over 400,000 monthly

Tokyo 23 wards

Benesse29.3%

Osaka, Hyogo Prefecture

Benesse18.9%

Nagoya, Aichi Prefecture

Benesse36.4%

22

Growth strategy for the Nursing Care BusinessShort-term and longer-term growth strategy for the Nursing Care business
Pursue growth strategy while strengthening the foundations by investing in HR and DX

Strategies(Short term）
 Recover occupancy rate from fallcaused by COVID-19 impact

Organic
growth(Longer term）
 Increase number of strategic homes••

Inorganic
growthStrengthening
the foundations

End-FY23 occupancy rate target
95.2％

Enter new areas and create dominance via
coordination with hiring strategy
Open distinctive new homes

Expand by around 12 a year

Expand nursing care peripheralbusinesses, particularly HR business

Aim to achieve sales of ¥10bn
as soon as possible＊inc. via M＆A

 HR and DX investment••

Targets

Verbalize/visualize knowledge × DX
Boost new graduate hiring, improve
working conditions

Improve seniors’ QOL, expand
human capital24Organic
growthRecover Occupancy Rate from Fall Caused by COVID-19

Strengthening marketing strategies with a view to improving occupancy rate.
Regain pre-COVID level by end-FY23
Measures
Strategies to improve occupancy rate
Build links with
regional hospitals/caremanagers＋

Short stay（trials）

Occupancy rate trends and targets
1Q situation• Occupancy rate at existing homes on target at end-1Q•（end-June 2022）

Number of tours (a lead indicator) up 174% on FY21

（as of June 2022. Comparison excludes homes opened in FY21 and FY22）

Occupancy rates and targets for existing homes
97.0% 95.2%<Benesse’s unique strengths＞① Can market at the area level(create dominance in large urban areas）② Has services to support hospitals/care managers（meal deliveries, nursing care consultation offices,
HR recruitment/dispatch）

95.0%

95.2%
93.0%

92.6%

93.0%

90.1%

91.0%

（Target）（Target）

89.0%
87.0%
85.0%

Regain pre-COVID level by end-FY23
End-FY19

End-FY20

End-FY21

End-FY22

End-FY23
25

Organic
growthEnter New Areas and Create Dominance via Coordination with Hiring Strategy

Create dominance in existing areas and enter new areas. Link to hiring strategy.
Policy on new home opening

Link to hiring strategy
FY22 opening plans

Dominance inexisting areas

Continue to proactively opening
distinctive high-end homes

Greater Tokyo,
West Japan (inc.
Okayama), Tokai

Several new homes
already opened

Pursue home development tocreate dominance in the medium
term

Sapporo, Sendai

Market withPotential Needs

Move into biggest areas, including
those set to have large senior
populations (75+) in the future

Fukuoka,
Hiroshima

Link tohiring strategy andpotential market

Base market entry on market
potential factors such as senior
population (75+), household
affluence

Kanazawa,
Kumamoto10
homes

Hokkaido・
TohokuHokuriku

GreaterTokyo・
West Japan・
Tokai

2
homes
Kyushu26

Organic
growthOpen Distinctive New Homes

Pursue QOL-focused services. Increase high-end homes and Benessestyle sensing homes.
High-end home（slated to open in October 2022）
Aria Kyoto Kamogawa Gosho Higashi

エントランスホール完成予想CGGozan no Okuribi（as seen from Aria
Kyoto Kamogawa Gosho Higashi）•「Aria」 is developed in the center of a historic and culturally mature
town where anyone will aspire to live.

•

Drawing on the home’s location, surroundings, and the history of thetown and utilizing trees and other natural resources, the home isdesigned to have individuality that reflects the region’s characteristics.

Sensing homes（planned）
 Collect further quality data on
nursing care experts“Majikami” and expedite
development of the “Majikami”
AI solution
 Plans to turn 56 homes,
including existing homes, into
sensing homes in FY23

Toilet sensor

Sleep sensor

etc.
27

Inorganic
growthGrowth Strategy for Nursing Care Peripheral Businesses

Proto Medical Care Co., Ltd.（currently Heart Medical Care) joined group in June 2021
M&A reasons & aims

Services available at time of joining
Media support business■Heart Pages
A community-based freepaper produced with local
authorities.

Living environment
support business■Rental/sale of welfare
equipment and home
improvement
Rental of long-term careinsurance-billable equipment

HR support business■Nurse Agent
Recruitment site dedicatedto nurses•

Nursing care peripheral business of
HR is a growth.

•”Staff pulling power” and “client
development capabilities” vital for
non-contiguous growth.

•Plans to establish an HR
recruitment business by leveraging
the strong “pulling power” of theportal site and robust “development
capabilities” of the media businessowned by the former
Proto Medical Care.

•

The former Proto Medical Care has
welfare equipment depots in 15
locations across Greater Tokyo andcould contribute to the total seniorliving concept already being
pursued by the Nursing Care &Childcare Company.

Silver Heart
15 locations across Tokyo,
Kanagawa, Saitama■Oasis Nursing Care

Comprehensive search site
for senior and nursing carehomes.

■Nursing Recruitment

Nav
Job-change site for medicalcare, nursing care, andwelfare jobs

■Medical Cubic
HR dispatch service fornurses and nursing carespecialists••

HR dispatch business
transferred to Benesse
MCM in April 2022.
Strategy of expediting
growth using respective
strengths of two HR
business.

28

Inorganic
growthGrowth Strategy for Nursing Care Peripheral Businesses

Current situation and future strategy

Target growth as an HR business specializing in medicine and nursing care via the
HR recruitment and HR dispatch operations.
Heart Medical Care

Benesse MCM

Aim to monetize multiple revenue
streams from media business、develop
as strong HR recruitment company

Further grow in strong HR dispatch by
expanding area, diversifying
occupations/projects•

Established recruitment business in February 2022
and overhauled Nursing Care Recruitment Naviportal site with a view to multiplying revenue
streams.

•

The nursing care HR market has been changed by the
COVID-19. Earnings fell due to a downturn in market
demand for nursing care worker dispatch but have beensteadily recovering as economic activity rebounds.

•

Introduce client-friendly pricing system* torecruitment business. Create new services until
established such as video-based staff training.

••

Intend to add new authorities and actively expand
highly-public media Heart Pages.

The main business transferred from Heart Medical Care is
the one-time dispatch of nurses to assist in home bathing
and other tasks. Benesse MCM intends to leverage this tostrengthen and expand work for nursing professionals aswell as current mainstay nursing care workers.

•

Sapporo office opened in August 2022. More openings are
required to grow the HR dispatch business, and new areas
will be considered in line with the demand outlook.

*Note: This system delays payment of the referral fee until the new hire has been inposition for one month in order to protect clients from the nursing care industry’s
high rate of turnover in the first few weeks of employment.

Heart Medical Care

Benesse MCM

29Strengthening
growthfoundations

Hiring of Nursing Care Workers and Improvement in Working Conditions

Actively hiring new graduates and improving working conditions. Aim to raise thesocial standing of the nursing care profession.
New graduate hiring

Improvement in working conditions

 781 new graduates joined the company
as nursing care workers in FY22

Improvements in the last 5 years• Apr 2017

Remuneration increased by rise in bonuses andallowances• Investment of around ¥1.3bn/yr. to improve remuneration
per nursing care worker by as much as ¥700,000/yr.

Attributes of 2022 new graduates（attributes of the 781 graduates hired as nursing care workers）

4-yr university
graduates
96％

Graduates fromnon-welfare courses

Continual
improvement • Oct 2019
Salary increased by revision of personnel
in working
systemconditions• Investment of around ¥1.4bn/yr. to improve working
conditions for highly specialty nursing care workers bybenchmarking industry average annual salaries, excluding
executives, at ¥4.40mn (as of 2019).
• Feb 2022

85％

AveragesalaryIntroduction of support allowance s to improve
working conditions

Full-time nursing care worker average more than ¥4.5mn,
above ¥4.4mn industry average

Continual revision of personnel system/expansion of training/improvement in remuneration andworking conditions↓
Raise social standing of the nursing care profession

30

Strengthening
growthfoundations

Characteristics of Benesse’s Nursing Care Business(QOL-focused Services)

Deep respect for people’s individuality＝Provision of QOL-focused services「Providing a selection of services that satisfy the resident and their families」「Allowing residents to live with dignity
in the manner they wish throughout their life」
Our original services put these ideas into practice、supporting residents through their whole lives via deep understanding foreach person and respect for 「individuality and character」.
【Facilities】
Environments, Buildings, and Equipment for a comfortable life

【Services】“Carers” to support the realization of people’s individuality

31

Strengthening
growthfoundations

Characteristics of Benesse’s Nursing Care Business(QOL-focused Services)

Verbalizing/visualizing the practical knowledge from 27 years into a structure to link principles and action

Principles「Deep respect for people’s individuality」「Benesse Method」 Verbalizing/visualizing the practical knowledge from 27 years
Care method
・Self-reliance support・Dementia care・Personal hygiene care

Personnel systemlinked to provisionof customer value

Facility design
method・Living environment creation
・Comfortable spaces

Nursing care expert“Majikami”
development system

Developing people who cancontinue to perform byequipping them with a highdegree of expert knowledge

まるで自分で動いているかのように感じられる

生き方とこだわりを
大切にした
生活プラン

介護技術

心のありかをチームで見つける

いｂいｈの認知症ケアベネッセの介護5つのコアバリュー（5つのサービスのスタイル）

役割・可能性・関係性を大切にした自立・自発支援

Benesse-style
Nursing Care DX
Service navigation system

・Adding impressions toregular care logs

■Training and practical application■Assessment framework■Nursing care technique guidelines

その方らしいさいごへの寄りそい*「Self-reliance support ® 」is support for the
spontaneous effort of seniors, and is the name of aservice offered by Benesse Style Care, Co., Ltd.

Action“Majikami” AI solution(under development)

32

Strengthening
growthfoundations

Nursing Care Expert “Majikami” Development System

The nursing care expert “Majikami” development system uses a program that fusesorganized training and practical application
About nursing care experts “Majikami”
Who arenursingcare
experts“Majikami”?

The typesof nursing
careexperts“Majikami”

They are specialists in solving
fundamental problems with thepractical, dissemination, andproposal skills to lead a team inorder to realize improved
residents’ QOL and targets(needs)Since the system’s inception in
FY19, 192 people have beendeveloped and accredited as
Majikami（as of Apr 2022）＜Types＞

The nursing care expert “Majikami” development system“Majikami” training

Verbalizing the knowledge of “Majikami” andincorporating it into the program
Framework
application,etc.

Dementiacare

Training

Application

Safety management
and prevention of
accident recurrence

Nursing caretechniques

Step3 training

 Dementia care

Step2 training Safety management andprevention of accident
recurrence

Step1 training

 Nursing care techniques

Application
at homes

Dementia
care

Safety management
and prevention of
accident recurrence

Nursing caretechniques

Development of nursing
care experts “Majikami”
with high degrees of
specialism• A development program thatverbalizes the knowledge of“Majikami”• Exams to supplement training.
Exams that tests techniques andknowledge, plus inspection of theprocess and results of initiatives toimprove residents’ QOL• Retesting once a year after
accreditation

Development of 「nursing
care professionals」• Become a full-time carer is thetarget level for all• Exams to supplement training*Also support for acquisition of thecertified care worker national qualification

33

Strengthening
Foundation for
GrowthNursing Care DX

The aim of Our DX is to improve the QOL of the elderly
Promoting Nursing Care DX not only to improve productivity but also
to improve QOL of the elderly
Alert when resident’s status changes

Service Navigation System• Recordkeeping platform developed in-house in 2017.
• The system is designed not only to streamline the recordkeeping andtranscribing process which was paper-based until now, but also to foster
more creativity in staff duties, thereby encouraging awareness among thestaff and opportunities to change their behaviour.
• The aim is to improve the residents’ QOL by performing services based on
information provided by the system, such as changes in a resident’s weightover a certain period of time and each individual’s various considerations.
• Winner of the Japan Institute of Information Technology’s 2018 Information
Technology Award.

Benesse’s versionof nursing care DX（past）

・・・・・・

Business Chat Tools

Facilitate multi-occupational collaboration

Nursing Care DX（present~future）

Incoming

Enable communications in facilities

Further promote nursing care DX through conversion of facilities into
sensing homes and AI development to improve QOL of the elderly（details on following pages）

34

Strengthening
Foundation for
GrowthNursing Care DX

Aim to improve QOL for the residents by fusing IT and human knowledge
Sensing homes

Features of Our DX First Benesse Sensing Home opened March 2022
Aiming to improve QOL for the residents
by fusing IT and human knowledge
Private-pay nursing home

Granda YotsuyaIntroduced in 6 facilities in FY21 to assess and develop the system
Information
gathering

Information
integration andvisualization

Diagnosis andhypothesis for
improving QOL

Sensors

Dashboard“Majikami” AI Solution

 Sleep sensor
 Presence/absence
sensor Toilet sensor
Capture information
accurately and in real time

＊Also sensors for
medication+facial recognition,
temperature check+facialrecognition, etc.

●●●

(in development)

Quality data
●

●

●

●
●

Integrate and visualize
resident’s information insensors and recording
system (Service Navigation
System)Nursing care experts“Majikami”

AI

AI incorporates expertiseand practical skills of“Majikami” as training data
to provide perspective andawareness to staff

35

Strengthening
Foundation for
GrowthNursing Care DX（”Majikami” AI Solution）

The aim of “Majikami” AI Solution is to improve QOL of the elderly and nursing staff
skills”Majikami” AI Solution Development Themes
Development of a nursing care support system to deliver true productivity gains
by using AI to detect BPSD* factors and signs that “something is different”＊joint development with Panasonic Corporation

 Development Theme 1． Analysis of BPSD* factors
200

10
8

100

6
4

50
0

2
1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

Residents’
information0

Nursingcare experts
マジ神“Majikami”

Example）
Data shows a tendency to sleep
soundly, but when comparedwith the resident’s personality,
could medication be the cause?

2021.9Selected to participate in AMED project
to promote development of robotic
devices for nursing care2022.4
Subsidy recipient this year as well

12

150

Subsidies from National Research andDevelopment Agency”Majikami”’s analytical perspective
used as training data in AI Development Theme 2．Detection of ”something different”

Veteran staff

Example）
Resident’s behaviour is different
from usual (no abnormalities invital signs)

2 hours later
sudden change

Detect signs based on veteranstaff’s “6 th sense”, communicate,find solution＊Note
BPSD : Behavioural and Psychological Symptoms of Dementia
AMED : Japan Agency for Medical Research and Development

36

Passing on Knowledge
Providing some of the practical knowledge gained over 27 years free of charge
Kaigo Antenna （Started Sep. 2019）

Providing information free of charge on comprehensive
nursing care site supporting those involved in nursing care
Nursing care techniques

Outings

Benesse’s nursing care techniques

Nursing technique guidelines（with video）

Information about wheelchair
accessible barrier-free
popular places

Benesse method

Prevention & disaster preparedness

Benesse’s nursing careknowledge and methods
available free of charge
Excretion function care &dementia care

Infectious disease prevention
measures
Disaster prevention

Nursing care recreational materials
Nursing care recreationmaterials

Over 5,000 items

Illustration materials
Over 1,000 nursing care
illustrations available forfree and for commercial use

etc.

Approximately 80,000 Kaigo Antenna members, mainly nursing care professionals （As of June 30, 2022）
The number is increasing steadily and is expected to surpass 100,000 by the end of FY2022 （March 31, 2023）
37

Growth Strategies for Daycare and AfterschoolChildcare BusinessGrowth Strategies for Our Daycare and Afterschool Childcare Business
To become the first choice for childcare support in the community, our main goals are to improve
the quality of childcare services and strengthen external communications.

Daycare Business

Afterschool Childcare BusinessAs daycare waiting lists shorten,
the market will become more competitive.
External
Factors・Declining birthrate means daycare waiting lists are shortening
・Number of new childcare centers planned by local governments has
decreased drastically. Private sector is also slowing down in opening
new childcare centers.

Afterschool childcare clubs and children
registered to use the clubs are increasing every year.
External
Factors

・Number of households with two working parents increasing makes
issue of children waiting for afterschool childcare places more
apparent, especially in metropolitan Tokyo.
・Around 27,000 afterschool childcare clubs. Over 1.3 million children
registered. (As of May 2021)

 Using digitalisation and the Benesse Method for childcare
to improve childcare services.
Benesse Method for Childcare“Words that Continually Expand a Child’s Universe”

History・January 2020, Published by Benesse
Corporation

Example of Main Activities
・Use for in-house training such aspreschool training, new graduate training,and more・Using a photo contest focused on 40
methods to help gain in-house advantage

History Focus on operating afterschool childcare clubs inmetropolitan Tokyo where the need is greatest.

Example of Main Activities

 Enrichment of hands-on activities that
integrate real-world experience and online

Digitalisation of childcare
・December 2018, began business
partnership between Benesse Corporation
and CoDMON・April 2022 installation completed in 62
out of 65 daycares

・Documenting daily schedule and sharing
with parents
・Digitizing records to improve operational
efficiency

Improving the quality of childcare and strengthening
external communications
 Passing on knowledge from 28 years of daycare center operational
experience.

Since FY19, commissioned by the Child Development Association of Japan to provide training
programs (childcare safety training, training for facility managers).

Opened two new afterschool childcare clubs in April 2022,
Received one new proposal from local government.

Expanding scope of activities with online events, hands-on experiencesat the club,and more.

 Developing services that leverage synergies with
the Education Business・Shinkenzemi's Red Pen Teacher service of correcting answers and handson lessons.
・Permanent display of Shinkenzemi teaching material samples andcollaboration with Benesse's English class, BE studio.

39

(1) Overview of the Nursing Care and Childcare
Business (Company)(2) Medium-to-Long Term Strategy and Future Vision(3) Profitability・Capital Efficiency
・OPM and ROIC
・Impact of Change in Accounting Standard for Revenue Recognition
・Impact of Application of Accounting Standard for Leases

Nursing Care and Childcare Business (OPM and ROIC)
Aim to recover both operating profit margin (OPM) and ROIC from FY2022 lows
Plan to raise ROIC to above group WACC（approx. 5％）from FY2023
Factors depressing OPM and ROIC

・Fall in occupancy rate from impact of COVID-19 (FY2021、FY2022）
・Impact of accounting standard change for revenue recognition (FY2022）

9.3

OPM
ROIC

8.4
6.3

6.5
5.4

FY2019FY2020

Aim to return both
OPM and ROIC toFY2019 levels by
FY2025

5.5

4.7

4.2

FY2021

FY2022E

FY2023E

FY2024E

FY2025E*FY2022 figures based on initial forecasts
41

Nursing Care Business(Impact of change in accounting standard for revenue recognition)
Change in booking standard for amortized occupancy fee sales revenue from FY21
(accounting change, no impact on customer usage contracts）
Eliminated initial amortization at start of usage (30% of occupancy fee)
BeforeAfter

30% of occupancy fee booked under sales
at start of usage, remaining 70% booked
uniformly throughout period of contract.

※In case of departure during the average period of occupancy,
the difference with the amortized cumulative amount based on the customer
usage contract is booked as a lump sum under sales.

30%

Lump sum booking
under sales

Uniform booking
throughout period of
occupancy

Start of occupancy

Total occupancy fee booked under sales uniformly
throughout average period of occupancy.

Uniform booking
throughout period of
occupancy

70%

Assumed 5-yr
period of occupancy

Uniform booking
throughout period of
occupancy

Start of occupancy

30%

70%

Average 6-yr
period of occupancy42

Nursing Care and Childcare Business(Impact of Application of Accounting Standard for Leases（Change in Balance of Lease Liabilities））

Large increase in lease liabilities from application of accounting
standard for leases on newly-opened facilities from FY2011（Billions of Yen）

Change in balance of lease liabilities

1,200
120

90
900

600
60

30
300

00

FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY202143

Nursing Care and Childcare Business(Impact of Application of Accounting Standard for Leases on ROIC)
Large increase in ROIC when calculated on a cash basis excluding the impact oflease accounting
Change in capital invested and ROIC
（Capital invested:
Billions of Yen）

Excluding the impact of lease accounting（ROIC）

1,500
150

20.0%

（Capital invested:
Billions of Yen）

150
1,500

（ROIC）

19.8%

20.0%

17.5%

14.1%

15.0%

100
1,000

17.0%

15.0%

13.0%

1,000
100

10.0%

7.2%

50
500

00

5.9%

FY20176.5%
5.4%

FY2018FY2019FY2020

10.0%

50
500
4.7%

FY2021

5.0%

0.0%

5.0%

00

FY2017FY2018FY2019FY2020

FY2021

0.0%*Excludes lease liabilities at Benesse Style Care from capital invested, adds depreciation costs forlease assets at Benesse Style Care back to OP but excludes lease interest and repayment ofprincipal for lease liability.

44