Summary of Financial Statements for the First Quarter of Fiscal Year Ending April 2025
[Japan GAAP] (Consolidated)
September 4, 2024
Name of listed company:

AIN HOLDINGS INC.

Exchange listed on:

Prime Market of Tokyo Stock Exchange and Sapporo Securities Exchange

Code number:

9627

URL: https://www.ainj.co.jp/corporate/

Representative:
Inquiries:

Kiichi Otani, President and Representative Director
Toshihide Mizushima, Representative Senior Managing Director
TEL: +81-3-5333-1812
Start of dividend payment:–
Supplementary documents for quarterly results:
Yes (Supplementary materials for the quarterly results are disclosed on the
Company’s website appropriately as the financial statements.)

Quarterly results briefing:No(Amounts are rounded down to the nearest million yen.)
1. Consolidated results for the first quarter of fiscal year ending April 30, 2025 (May 1, 2024 to July 31, 2024)(1) Consolidated operating results(Percentage figures show year-on-year changes.)
Profit attributable to
Net sales
EBITDA
Operating profit
Ordinary profit
owners of parent
Million yen

Three months ended
103,603
July 31, 2024
Three months ended
94,654
July 31, 2023
(Note) Comprehensive income:%Million yen%

Million yen%

Million yen%

Million yen

%

9.5

5,578

(8.7)

2,757

(23.6)

2,969(23.5)

1,642(23.3)

16.2

6,111

22.4

3,610

31.1

3,881

25.6

2,140

25.5

Three months ended July 31, 2024: ¥1,667 million (-23.5%)
Three months ended July 31, 2023: ¥2,179 million (+28.5%)(Note) EBITDA = operating profit + depreciation + amortization of goodwill
Profitper share

Diluted earnings
per share
Yen

Yen

Three months ended July 31, 2024

46.93

–

Three months ended July 31, 2023

60.93

–

(2) Consolidated financial position
Total assets

Net assets

Shareholders’equity ratio

As of July 31, 2024

Million yen
248,139

Million yen
134,354%
54.1

As of April 30, 2024

249,409

135,411

54.3(Reference) Shareholders’ equity:

As of July 31, 2024: ¥134,256 million

As of April 30, 2024: ¥135,307 million

2. Dividends

Year ended April 30, 2024

End of firstquarter
Yen–

Dividend per share
End of third
quarterYen–
0.00

End of second
quarter
Yen–
Year ending April 30, 2025
Year ending April 30, 2025
0.00
(forecast)(Note) Revision to the most recently announced dividend forecasts: No–

End of year

Full year

Yen

Yen

80.00

80.00

80.00

80.00

3. Consolidated financial forecasts for the fiscal year ending April 30, 2025 (May 1, 2024 to April 30, 2025)(Percentage figures show year-on-year changes.)
Net sales

EBITDA

Operating profit

Ordinary profit

Profit attributable toProfitowners of parent

per share

Million yen%

Million yen%

Million yen%

Million yen%

Million yen%

Yen

First sixmonths

213,670

10.3

13,150

(5.1)

6,770

(22.6)

7,150(23.4)

3,800(27.7)

108.56

Full year

453,500

13.4

33,6207.3

19,360(5.2)

20,000(6.4)

10,000(12.3)

285.68(Note) Revision to the most recently announced consolidated financial forecasts: Yes
For more details about revisions to forecasts, please refer to today’s release (September 4, 2024), “Notice of Upward
Revisions to Consolidated Financial Forecasts.”*Notes(1) Significant changes in the scope of consolidation during the period: No
Newly consolidated: –Excluded: –(2) Application of specified accounting methods for the preparation of quarterly consolidated financial statements: Yes(Note) For detail, please refer to “2. Quarterly consolidated financial statements and major notes (3) Notes on quarterly
consolidated financial statements” on page 8 of the Attachment.
(3) Changes in accounting principles, changes in accounting estimates, and restatement of revisions
1) Changes in accounting principles as a result of revisions to accounting standards, etc.:
Yes2) Changes in accounting principles other than 1):
No3) Changes in accounting estimates:
No4) Restatement of revisions:No(4) Number of outstanding shares (common stock)1) Number of outstanding
shares (including treasury
As of July 31, 2024
shares):2) Number of shares held in
As of July 31, 2024
treasury:
3) Average number ofThree months ended
shares outstanding:July 31, 2024

35,428,212 shares As of April 30, 2024

35,428,212 shares

415,485 shares As of April 30, 2024

433,891 shares

Three months ended
July 31, 2023

35,130,024 shares

35,003,889 shares(Note) Number of shares held in treasury includes the Company's shares held by Custody Bank of Japan, Ltd. (Trust
Account E) (as of April 30, 2024: 333,800 shares, as of July 31, 2024: 315,300 shares). In addition, the Company’s
shares held by Custody Bank of Japan, Ltd. (Trust Account E) are included in treasury shares deducted from thecalculation of average number of shares outstanding during the period (three months ended July 31, 2023: - shares,
three months ended July 31, 2024: 324,200 shares).
*Review of the attached quarterly consolidated financial statements by certified public accountants or independent accountauditors: No*Statement regarding the proper use of financial forecasts and other special remarks(Caution concerning forward-looking statements)
The above forecasts are calculated based on the information available as of the publication date of this material, and actual
financial results may vary due to change in future economic conditions and others.

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

Contents of the Attachment
1. Overview of Operating Results, etc. ........................................................................................................................................ 2(1) Overview of quarterly operating results .............................................................................................................................. 2(2) Overview of quarterly financial position .............................................................................................................................. 3(3) Forecast of consolidated financial results and other forward-looking information............................................................... 3
2. Quarterly consolidated financial statements and major notes ................................................................................................. 4(1) Quarterly consolidated balance sheet ................................................................................................................................ 4(2) Quarterly consolidated statements of income and comprehensive income ........................................................................ 6
Quarterly consolidated statement of income .................................................................................................................... 6
Quarterly consolidated statement of comprehensive income ........................................................................................... 7(3) Notes on quarterly consolidated financial statements ........................................................................................................ 8(Notes on changes in accounting policies) ....................................................................................................................... 8(Notes on specified accounting methods for the preparation of quarterly consolidated financial statements).................. 8(Segment information, etc.) .............................................................................................................................................. 8(Notes on significant changes in the amount of shareholders’ equity) ............................................................................. 9(Notes on the premise of a going concern) ...................................................................................................................... 9(Notes to quarterly consolidated statement of cash flows) ............................................................................................... 9(Additional information) .................................................................................................................................................... 9(Material subsequent events) ......................................................................................................................................... 10

1

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

1. Overview of Operating Results, etc.
(1) Overview of quarterly operating results
During the first three months of the current fiscal year (May 1, 2024 to July 31, 2024), the Japanese economy recovered
gradually along with an improvement in the employment and income environment. However, conditions remain uncertain
due to the risk of downward pressure on the domestic economy from slowing conditions overseas, as well as rising prices
and fluctuations in financial and capital markets.
Against this backdrop, the AIN HOLDINGS Group (the Group) worked to provide healthcare and retail services in line withits mission to “contribute to local healthcare” and “provide beauty and happiness” – two of the Group’s materiality issues. In
addition, promoting diversity & inclusion is a key part of efforts to create a “sound management base,” another of the Group’smateriality issues. Specifically, the Group is actively promoting women’s participation in the workplace, including providing
training to help female employees transform their thinking and build career pathways by harnessing their management
capabilities, and stepping up measures to promote work-life balance, among other initiatives. These efforts have beenrecognized publicly, with AIN PHARMACIEZ INC., the Group’s core operating company, receiving “Platinum Eruboshi”
certification from the Minister of Health, Labour and Welfare in June 2024. Together with these initiatives, the Group isreinforcing its human resources strategy. In July this year, the Company expanded the disclosure of KPIs and otherinformation related to human capital management, an area of focus for the Group.
Going forward, the Group will continue striving to be a company that “people welcome to their communities” by helping tosolve various social issues through its business activities.
Results for three months ended July 31, 2024 (May 1, 2024 to July 31, 2024) are as follows.
(Million yen)
ChangeThree months
Three months

ended
July 31, 2023

ended
July 31, 2024

94,654
3,610
3,881
2,140

103,603
2,757
2,969
1,642

Three months
ended
July 31, 2023

Three months
ended
July 31, 2024

Sales
84,405
Segment profit
5,429
Sales
7,412
Segment profit
710
Sales
2,848
Other businesses
Segment profit(5)(loss)(Note) Segment sales include intersegment transactions.

91,866
4,245
8,947
1,016
2,801
20

Net sales
Operating profit
Ordinary profit
Profit attributable to owners of parent
Results by segment are as follows.
(Million yen)

Dispensing
pharmacy business
Cosmetic and drug
store business

8,949
(853)
(911)
(497)

Change7,460(1,183)
1,534
306
(46)
25

Change (%)

9.5(23.6)(23.5)(23.3)

Change (%)

8.8(21.8)
20.7
43.1
(1.6)
－

(Dispensing pharmacy business)
In the dispensing pharmacy business, the Group’s vision is to “become the primary care pharmacy of choice for local
communities, backed by proven expertise.” To realize this vision, the Group is working to leverage the primary carecapabilities of its pharmacists and dispensing pharmacies to help patients access medical services in their local community
with peace of mind. Specifically, the Group is cooperating with medical institutions, using patient medication notebooks toensure integrated and continuous monitoring of patient medication, and providing services for home-based healthcare.
The Group is also actively promoting digital transformation (DX) to improve convenience for patients. This includes making
its prescriptions sending service more accessible for customers by enabling access through the official AIN Pharmacy app,
Anytime AIN Pharmacy and the official AIN Pharmacy LINE account.
During the first three months of the fiscal year, the average prescription price rose due to an increase in high-costprescriptions. The number of prescriptions also increased, reflecting higher service levels related to improvements in thecapabilities of primary care pharmacists and pharmacies and reduced waiting times.
During the same period, the Group opened 12 new dispensing pharmacies, including those acquired through M&A deals,
and sold eight, resulting in a total of 1,235.

2

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

(Cosmetic and drug store business)
In the cosmetic and drug store business, the Group operates the chain of AINZ & TULPE cosmetics and drug stores,
which are clearly differentiated from other retailers with their unique product offerings centered on cosmetics and exclusive
and advance sales of Asian cosmetics brands.
During the first three months of the fiscal year, the number of customers at existing stores and stores opened in theprevious fiscal year remained firm, and unit prices increased due to growth in sales of Asian cosmetics and high-priced
cosmetics, maintaining the trend from the previous fiscal year. The Group will continue to closely monitor buying trends,
reinforce the merchandise lineup and create attractive retail environments.
During the same period, the Group opened two stores and closed one, resulting in a total of 82 stores.
Also, as notified in a press release on July 3, 2024, “Notice Regarding Acquisition of Shares of Francfranc Corporation(Conversion to Subsidiary),” Francfranc Corporation (“Francfranc”), a retailer of interior goods and sundries, joined the Groupin August. Going forward, the Group plans to leverage the respective strengths of AINZ & TULPE and Francfranc to expand
the business and further increase the Group’s corporate value.
(2) Overview of quarterly financial position
The balance of total assets at the end of the first quarter declined ¥1,270 million from the end of the previous fiscal yearto ¥248,139 million, mainly reflecting decreases for accounts receivable – trade and accounts receivable – other.
The balance of liabilities decreased ¥213 million to ¥113,784 million.
The balance of short-term and long-term borrowings declined ¥828 million to ¥5,865 million, primarily reflecting therepayment of borrowings.
Total net assets decreased ¥1,057 million to ¥134,354 million and the shareholders’ equity ratio declined 0.2 of apercentage point to 54.1%.
(3) Forecast of consolidated financial results and other forward-looking information
The Group has revised its consolidated financial forecasts for the fiscal year ending April 30, 2025, which were announced
on June 6, 2024. For more details, please refer to today’s release (September 4, 2024), “Notice of Upward Revisions toConsolidated Financial Forecasts.”

3

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

2. Quarterly consolidated financial statements and major notes(1) Quarterly consolidated balance sheet(Million yen)

AssetsCurrent assets
Cash and deposits
Accounts receivable - trade
Merchandise
Supplies
Short-term loans receivable
Accounts receivable - other
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings and structures, net
Land
Other, net
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Leasehold and guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

4

Fiscal year endedApril 30, 2024
(As of April 30, 2024)

Three months ended
July 31, 2024
(As of July 31, 2024)

48,611
15,852
24,299345
144
16,0005,490(1)110,743

49,404
13,88625,980349
323
12,8616,555(1)109,359

27,122
10,207
6,121
43,45027,625
10,1586,312
44,09644,066
7,176
51,24243,0207,359
50,3803,345
6,403
25,1869,315(276)
43,973
138,666
249,409

3,515
6,214
25,4749,357(258)
44,303
138,780
248,139

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

(Million yen)

Liabilities
Current liabilities
Accounts payable - trade
Short-term borrowings
Income taxes payable
Deposits received
Provision for bonuses
Provision for bonuses for directors
Contract liabilities
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Retirement benefit liability
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income (loss)
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

5

Fiscal year endedApril 30, 2024
(As of April 30, 2024)

Three months ended
July 31, 2024
(As of July 31, 2024)

65,506
3,467
4,532
19,063
3,394
19
465
6,784
103,232

70,484
3,385
1,498
19,580
2,439
11
460
5,748
103,608

3,227
4,662
2,876
10,765
113,998

2,479
4,760
2,936
10,176
113,784

21,894
20,131
95,257(2,436)
134,847

21,894
20,131
94,073(2,334)
133,765

234
225
459
104
135,411249,409

283
206
490
98
134,354248,139

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

(2) Quarterly consolidated statements of income and comprehensive income
Quarterly consolidated statement of income(Million yen)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Commission income
Rental income from real estate
Outsourcing service income
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Loss on sale of receivables
Rental expenses on real estate
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sale of non-current assets
Gain on sale of businesses
Other
Total extraordinary income
Extraordinary losses
Loss on sale and retirement of non-current assets
Impairment losses
Loss on valuation of investment securities
Other
Total extraordinary losses
Profit before income taxes
Income taxes
ProfitLoss attributable to non-controlling interests
Profit attributable to owners of parent

6

Three months ended
July 31, 2023
(May 1, 2023 toJuly 31, 2023)
94,65481,455
13,1999,588
3,610

Three months ended
July 31, 2024
(May 1, 2024 toJuly 31, 2024)
103,603
90,671
12,931
10,174
2,757

11
18
2
79
56
42
138
350

9
18
2
79
87
8
138
343

8
26
38
5
79
3,881

5
51
23
49
130
2,969

274
–
3
277

0
527
0
528

71
139
–
6
216
3,942
1,805
2,136
(3)
2,140

7
65
43
0
116
3,381
1,744
1,636
(5)
1,642

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

Quarterly consolidated statement of comprehensive income(Million yen)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Remeasurements of defined benefit plans, net of tax
Total other comprehensive income (loss)
Comprehensive income
Comprehensive income attributable to owners of parent
Comprehensive income attributable to non-controllinginterests

7

Three months ended
July 31, 2023
(May 1, 2023 toJuly 31, 2023)
2,136

Three months ended
July 31, 2024
(May 1, 2024 toJuly 31, 2024)
1,636

50
(7)
42
2,179
2,183

48
(18)
30
1,667
1,673

(3)

(5)

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

(3) Notes on quarterly consolidated financial statements(Notes on changes in accounting policies)(Application of Accounting Standard for Corporate Tax, Inhabitant Tax and Enterprise Tax, etc.)
The Company applied the “Accounting Standard for Corporate Tax, Inhabitant Tax and Enterprise Tax, etc.” (ASBJ
Statement No. 27, October 28, 2022) from the beginning of the first quarter of the current fiscal year.
The application of the standard has no impact on the Company’s quarterly consolidated financial statements.
(Notes on specified accounting methods for the preparation of quarterly consolidated financial statements)
To calculate tax expenses, the effective tax rate on profit before income taxes for the consolidated fiscal year after theapplication of tax effect accounting is reasonably estimated and the estimated rate is applied to profit before income taxes
for the quarterly period.
(Segment information, etc.)
I Three months ended July 31, 2023 (May 1, 2023 to July 31, 2023)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

84,405

7,412

2,835

94,654－

94,654(2) Intersegment sales

－

－

12

12

(12)

－

84,405

7,412

2,848

94,666(12)

94,654

5,429

710

(5)

6,134

(2,252)

3,881

Total

Sales

Total sales
Segment profit (loss)
Notes:

1. The adjustment of ¥(2,252) million to segment profit (loss) includes ¥2,587 million in corporate expenses, ¥(323)
million in (income) loss that is not allocated to reportable segments, and ¥(11) million in eliminations due tointersegment transactions.
Corporate expenses consist mainly of expenses associated with the administrative divisions and the system
logistics division, which are not part of the reportable segments.
2. Segment profit (loss) is adjusted with the ordinary profit of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]
There are no applicable matters to be reported.
Ⅱ Three months ended July 31, 2024 (May 1, 2024 to July 31, 2024)
1. Net sales and income (loss) by reportable segment
Reportable segments
Adjustments(Note) 1(Million yen)
Carried onquarterly
consolidated
statements ofincome(Note) 2

Dispensing
pharmacybusiness

Cosmetic anddrug store
business

Otherbusinesses(1) Sales to third parties

91,866

8,947

2,789

103,603－103,603(2) Intersegment sales

－

－

12

12

(12)

－

91,866

8,947

2,801

103,615(12)

103,603

4,245

1,016

20

5,282

(2,313)

2,969

Total

Sales

Total sales
Segment profit (loss)

8

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

Notes:

1. The adjustment of ¥(2,313) million to segment profit (loss) includes ¥2,592 million in corporate expenses, ¥(274)million in (income) loss that is not allocated to reportable segments, and ¥(4) million in eliminations due tointersegment transactions.
Corporate expenses consist mainly of expenses associated with the administrative divisions and the system
logistics division, which are not part of the reportable segments.
2. Segment profit (loss) is adjusted with the ordinary profit of quarterly consolidated statements of income.

2. Impairment losses on fixed assets and goodwill by reportable segment[Significant impairment losses on fixed assets]
There are no applicable matters to be reported.
[Significant changes in the amount of goodwill]
There are no applicable matters to be reported.
(Notes on significant changes in the amount of shareholders’ equity)
There are no applicable matters to be reported.
(Notes on the premise of a going concern)
There are no applicable matters to be reported.
(Notes to quarterly consolidated statement of cash flows)
A quarterly consolidated statement of cash flows has not been prepared for the first quarter of the current fiscal year.
Depreciation (including amortization related to intangible fixed assets excluding goodwill) and amortization of goodwill forthe first quarter of the fiscal year under review are as follows.
Three months ended
Three months ended
July 31, 2023
July 31, 2024
(May 1, 2023 to(May 1, 2024 toJuly 31, 2023)
July 31, 2024)
Depreciation¥1,414 million¥1,697 million
Amortization of goodwill
1,086
1,123

(Additional information)(Transactions for delivering the Company’s own shares to employees etc. through trusts)
The Company conducts transactions to deliver its own shares through a trust to an employee stock ownership plan toenhance the welfare of employees and provide incentives to increase the Company's corporate value.
1. Transaction summary
The Company has introduced the " Stock-Based Benefit Trust (Employee Shareholders Association Purchase Type) (thePlan) from April 2024.
With the introduction of the Plan, the Company, as the Trustor, entered into a Stock-Based Benefit Trust (Employee
Shareholders Association Purchase Type) Agreement (the “Trust Agreement”; the trust established pursuant to the Trust
Agreement is referred to as the “Trust”) with Mizuho Trust & Banking Co., Ltd. (the “Trustee”). Additionally, the Trustee
entered into a re-trust agreement with Custody Bank of Japan, Ltd. regarding the management of securities and other trust
assets by Custody Bank of Japan, Ltd. as the subtrustee.
Custody Bank of Japan, Ltd. will make a single collective acquisition of the Company’s shares in advance equivalent to
the number of shares anticipated to be purchased by the AIN HOLDINGS Employee Shareholders Association (the“Shareholders Association”) over the next five years, transferring them to the Trust Account E, and sell the Company’s
shares thereafter when purchases of the shares are made by the Shareholders Association. If an amount equivalent to thegains on sales of shares is accumulated in the trust assets of the Trust via the sale of the Company’s shares up until thetime of the Trust’s termination, this cash shall be distributed as residual assets to the members of the Shareholders
Association (employees) who satisfy the beneficiary eligibility requirements.
In addition, since the Company provides a guarantee when the Trustee takes out a loan in order for the Trust Account E
to acquire the Company’s shares, in a case in which the Trustee has an outstanding loan balance equal to the loss on thesale of shares as of the time of Trust’s termination due to a drop in the Company’s share price or other reasons, theCompany will pay off the outstanding loan balance pursuant to the guarantee agreements.
2. Company’s shares held in the trust
The Company's shares held in the trust are recorded as treasury shares under net assets at the acquisition cost(excluding the amount of incidental expenses). In the fiscal year ended April 30, 2024, the book value and number of these9

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025

treasury shares amounted to ¥1,844 million and 333 thousand shares, respectively. And in the first quarter of the fiscal
year ending April 30, 2025, the book value and number of these treasury shares amounted to ¥1,741 million and 315
thousand shares, respectively.
3. Book value of loans recorded under the gross amount method
Fiscal year ended April 30, 2024 ¥1,845 million
First quarter of the fiscal year ending April 30, 2025: ¥1,845 million(Material subsequent events)(Business combination through acquisition)
At a meeting of the Board of Directors on July 3, 2024, the Company approved the acquisition of shares in Francfranc
Corporation (Head office: Minato-ku, Tokyo; “Francfranc”) to make it a subsidiary. A share purchase agreement was
concluded on the same day. On August 20, 2024, the Company acquired all shares of Francfranc, making it a subsidiary. In
addition, on August 21, 2024, the Company concluded an absorption-type split agreement with an effective date of October
1, 2024. Under the agreement, the interior goods and sundries retail sales business of Francfranc, a wholly owned subsidiaryof the Company, will be split off and assumed by AIN PHARMACIEZ INC., also a wholly owned subsidiary of the Company.
(1) Overview of business combination(i) Name and business of acquired company
Name: Francfranc Corporation
Business: Planning, development and sales of interior goods and sundries(ii) Main reasons for business combination
The Group has two core businesses – the dispensing pharmacy business and the cosmetic and drug store
business – that seek to play a key role in regional communities. In the dispensing pharmacy business, the Company
operates a nationwide chain of dispensing pharmacies. Together with Group companies, the Company is actively
opening new dispensing pharmacies and utilizing M&A to expand the business. The Company is also working toprovide community-focused healthcare services in all regions of Japan, such as through home-based dispensing andcontinuous monitoring of patient medication in partnership with medical institutions, and by enhancing the primarycare capabilities of its pharmacists and dispensing pharmacies.
In the cosmetic and drug store business, the Company operates the chain of AINZ & TULPE cosmetic and drug
stores. AINZ & TULPE aims to be a unique and comprehensive beauty retailer that satisfies customer needs with analways-fresh lineup of cosmetic and beauty products through stores offering a fun shopping experience. The brandis targeting further growth and aims to clearly stand apart from other beauty retailers with a lineup of original products
focused on cosmetics.
Francfranc became a subsidiary after the acquisition of all its shares by the Company. Since its establishment,
Francfranc has operated a business selling interior goods and sundries aimed at a wide range of customers, mainly
women in their 20s and 30s, centered on the Francfranc flagship brand. Through the operation of 152 stores in Japan,
nine stores overseas (as of July 3, 2024) and e-commerce sales, Francfranc offers urban and sophisticated lifestyle
proposals.
AINZ & TULPE and Francfranc have stores in similar markets and target customer segments with similar values,
but they are complementary in terms of product lineups and retail categories. The Company believes that Francfranc’s
addition to the Group will generate synergies by leveraging the strengths of both companies. The Company envisages
the following synergies.
(a) Cross merchandisingWith strengths in different product categories, AINZ & TULPE and Francfranc stores will be able to display
their respective in-house products, offering a wider choice to customers, improving customer satisfaction andincreasing sales per customer.
(b) Strategic store development
AINZ & TULPE and Francfranc stores are compatible, as they are located in station buildings and commercial
facilities, primarily in major cities, and target similar customer segments. This offers further opportunities forbusiness expansion through the opening of a wider range of different store formats, such as strategic joint storesin large commercial facilities.
(c) Development of appealing products using shared know-how
In line with their mission of offering lifestyle proposals, AINZ & TULPE and Francfranc have both focused on
developing products that influence customers' values. By sharing product development know-how, bothcompanies will be able to create products that offer even higher levels of satisfaction.
The Company believes that combining the complementary strengths of both companies in this way will improvecustomer service and enhance the corporate value of the Group.
(iii) Date of business combination
August 20, 2024
10

AIN HOLDINGS INC. (9627) Summary of Financial Statements for the First Quarter of the Fiscal Year Ending April 30, 2025(iv) Legal form of business combination
Acquisition of shares(v) Name of company after acquisition
No change(vi) Share of voting rights acquired
100%(vii) Main basis for determining company has been acquired
Cash payment for shares in the company(2) Breakdown of acquisition cost and payments
Consideration for acquisition

Cash¥49,976 million

Acquisition cost

¥49,976 million

Advisory fees, etc. are not included as they have not yet been determined. The acquisition price for dilutive shares is
included.
(3) Details and amounts of significant acquisition-related expenses
Not finalized at this time(4) Amount and reasons for goodwill, amortization method and amortization period
Not finalized at this time(5) Amounts and breakdown of significant assets acquired and liabilities assumed on the date of business combination
Not finalized at this time
(Significant borrowings)
At a meeting of the Board of Directors on August 15, 2024, the Company approved a resolution to borrow funds to partiallyfinance the acquisition of Francfranc Corporation. Details are as follows.
(1) Lenders

The Hokkaido Bank, Ltd., North Pacific Bank, Ltd., Mizuho Bank, Ltd., Sumitomo
Mitsui Banking Corporation, The Norinchukin Bank, MUFG Bank, Ltd.

(2) Loan amount¥32,000 million(3) Loan dateAugust 19, 2024

(4) Loan interest rate

Fixed interest rate(5) Loan period

Seven years(6) Repayment method

Equal repayment of principal every three months(7) Collateral / guaranteeNone11