Supplementary Material for

FY2023 Q1 Financial Results

March 14, 2023

◤◤ Contents⚫ Consolidated Financial Highlights

2⚫ Gyomu Super Business4⚫ Outline of Gyomu Super Franchise Agreement5⚫ Changes in Total Number of Gyomu Super Stores

6⚫ Year-on-year Changes in Product Shipments to Gyomu Super Stores

7⚫ Kobe Bussan’s Strengths: “Unique Products with Competitive Advantages”

8⚫ Restaurant & Delicatessen Business9⚫ Eco Renewable Energy Business13⚫ Shareholder Returns

15⚫ Consolidated Financial Forecast

16⚫ Medium-term Management Plan

17
1

◤◤ Consolidated Financial Highlights<Millions of yen>

<Millions of yen>

Net Sales

120,000

15,000100,000

13,00080,00070,63696,80985,045

81,597

107,942

16.0%

12.2%

10.4%

12,98010,816

10,444

11,781

8.0%
4.0%
0.0%

FY19 Q1
FY19 Q1<Millions of yen>

9.3%

FY20 Q1

FY21 Q1

FY22 Q1<Millions of yen>

9.0%

7,000
6,000
5,000
4,000
6,596

4.0%

7,346

2,000

3,410

1,000

4.6%

4.5%

4,335

10.0%

10,000

8.0%

8,000
6,000

4.0%

4,000

2.0%

0

0.0%
FY19 Q1

FY20 Q1

FY21 Q1

販売管理費
SG&A expenses

FY22 Q1

FY23 Q1

売上高販管費率
SG&A ratio

FY21 Q1

FY22 Q1

2,000

FY23 Q1

Gross margin
売上高総利益率

Operating Profit
8.3%
6.9%

10.0%
7.7%

6.0%

6.0%

4,922

FY20 Q1
Gross profit
売上総利益

FY23 Q1

SG&A Expenses

12.0%

11,261

5,000

0

3,000

12.3%

9,000
7,000

20,000

8,000

20.0%

15.9%

11,00060,00040,00015.3%

Gross Profit

8.0%
5.9%
6.0%

4,219

5,634

7,034

7,446

4.0%
6,338
2.0%

0

0.0%
FY19 Q1

FY20 Q1

FY21 Q1

営業利益
Operating profit

Note: Fiscal year (FY) represents the one-year period from November 1 to October 31 of the following year.

FY22 Q1

FY23 Q1

売上高営業利益率
Operating margin2◤◤ Consolidated Financial Highlights<Millions of yen>
20,000

8.3%

10.0%

6,000

8.0%

5,000

7.9%

7.0%

16,00012,000<Millions of yen>

Ordinary Profit

5.7%

6.0%

4,000

Profit Attributable to
Owners of Parent
5.4%

5.0%

4.4%
3.8%

4.0%

3,000
8,000

4.0%
2.0%

4,000
4,045

5,751

7,019

7,629
2,118

0
FY19 Q1

FY20 Q1

FY21 Q1

経常利益
Ordinary profit

FY22 Q1

FY23 Q1

売上高経常利益率
Ordinary margin

1,000

0.0%

0

2,695

3.0%

5,121

4,598

2,000

2.0%

6.0%

5.3%

1.2%

3,559

1,348

2.0%
1.0%
0.0%

FY19 Q1

FY20 Q1

FY21 Q1

FY22 Q1

親会社株主に帰属する四半期純利益
Profit attributable to owners of parent

FY23 Q1

売上高四半期純利益率
Net margin[Financial Overview]⚫ Net sales
Net sales increased by ¥11,133 million (11.5%) year on year with robust new store openings and continued strong product shipments to existing
stores.
⚫ Gross profit
Gross profit decreased by ¥520 million (4.4%) year on year due to the continued impact of the exchange rate fluctuations and the soaring raw
material prices. Assuming the foreign exchange market maintains the current trend, the exchange rate impact on gross profit for Q2 onwards willbe less significant than a year ago.
⚫ SG&A expenses
SG&A expenses increased by ¥587 million (13.6%) year on year due to increases in freight costs for the Gyomu Super Business and personnel andrent expenses resulting from the opening of our directly operated BBQ restaurants.
⚫ Operating profit
Operating profit decreased by ¥1,107 million (14.9%) year on year. The expected improvement in gross profit for Q2 onwards as mentioned above
will lead to improvement in operating profit.
⚫ Ordinary profit
Ordinary profit decreased by ¥5,510 million (72.2%) year on year due to the recording of a loss on valuation of forward exchange contracts resulting
from the rapid appreciation of yen from the beginning of Q1 as well as the factors above. While the valuation loss varies depending on the exchange
rates at quarter-end, we expect the loss to be reversed by the end of FY2023.

⚫ Profit attributable to owners of parent
As a result of the factors above, profit attributable to owners of parent decreased by ¥3,772 million (73.7%) year on year.

3◤◤ Gyomu Super BusinessGyomu Super is our core business. Operating results of this business segment reflect wholesale sales to, androyalty fee from, Gyomu Super franchisees earned by Kobe Bussan, a franchisor (franchising headquarters), as wellas earnings of Kobe Bussan Group’s plants.

◼ Gyomu Super stores have expanded nationwide with 1,012
stores as of January 31, 2023.
◼ Net sales for FY2023 Q1 exceeded the planned amount.
◼ We revised prices mainly for private label items produced byour group’s domestic plants to address cost rises caused
primarily by the continuously soaring prices of raw materials.
Gyomu Super Hakodate Taya Store (Our 1000th store)<Millions of yen>

Net Sales(cumulative)<Millions of yen>

9.4%

10,000120,000

8,000

Operating Profit(cumulative)
8.5%

10.0%

8.9%

7.3%

7.0%

8.0%

90,0006,000
60,00030,00061,793

71,792

83,70994,579104,818

6.0%

4,000
2,000

7,853
4,526

8,408

6,074

7,306

2.0%

0

0.0%
FY19 Q1

0
FY19 Q1

FY20 Q1

FY21 Q1

FY22 Q1

FY23 Q1

4.0%

FY20 Q1

FY21 Q1

Operating profit
営業利益

FY22 Q1

FY23 Q1

営業利益率
Operating margin

Note: Due to a change in the reportable segment structure in FY2021, the figures for FY2020 are reclassified retrospectively to reflect the change.
4
Accordingly, the figures for these two years are not consistent with those for FY2019 or before.

◤◤ Outline of Gyomu Super Franchise Agreement
We operate Gyomu Super stores under a franchise system except 3 stores of our own.
Our franchise agreement has 2 types as follows:• General franchise contract, which allows a franchisee to open 1 store in our directly managed areas (*1).
• Area franchise contract, which allows a franchisee to open multiple stores in a defined prefecture in our indirectly managed
areas (*2). Also, we own 3 stores in Hyogo and Osaka prefectures under direct operations.
関西直轄
228店舗

*1 Directly managed areas• Hokkaido area: Hokkaido prefecture• Kanto area:
Tokyo, Chiba, Kanagawa, and Saitama prefectures• Kansai area:
Osaka, Kyoto, Hyogo (excl. Awaji Island), Nara, Wakayama, and Shiga prefectures• Kyushu area:
Fukuoka, Saga, Nagasaki, Kumamoto, Oita, and Miyazaki prefectures

関東直轄
191店舗

Outline of Franchise Contract & Requirements

Simulated Earnings(as of January 31, 2023)(Standard Store Franchisees)

Directly managed areas

Indirectly managed areas

Number of franchisees

8915Type of franchise
agreement

Single-unit franchise(A general franchisee can open
1 store per contract.)

Multi-unit franchise(An area franchisee has an
exclusive right to open multiple
stores in a prefecture defined
under the contract.)

Initial franchise fee(excl. consumption taxes)¥2,000,000

Population in the prefecture x ¥2

Franchise deposit¥10,000,000

Population in the prefecture x ¥5

1% of total purchase of goods

1% of purchase of defined goods

Royalty fee

Facility expenses

Distribution expenses

It costs between ¥32 million and ¥38 million to construct racks for
shelf-stable foods and refrigeration equipment (the above
construction cost is a rough estimate and varies depending on
properties). Equipment, construction work, POS registers, and otherfunds for start-up are required separately.
Principally paid byfranchise headquarters

神奈川県
55店舗

東京都
64店舗

地方エリア
315店舗

*2 Indirectly managed areas• Other areas:
Prefectures other than those listed above

千葉県
33店舗

Negotiable

P&L accountMonthlyamountComposition

Net sales¥43,500,000

100.0％

Gross profit¥7,395,000

17.0％

SG&A expenses¥6,499,000

14.9％(Rent expenses)¥1,300,000

3.0％(Personnel expenses)¥2,393,000

5.5％¥896,000

2.1％

Operating profit* By purchasing items such as fresh food separately, many offranchisees operate more efficiently than the above simulation.

5◤◤ Changes in Total Number of Gyomu Super Stores
Gyomu Super opened 7 stores and closed 2, resulting
in a net increase of 5 stores during FY2023 Q1.
The progress at the end of FY2023 Q1 was 13%
toward the full-year target of a net increase of 40
stores.

We expanded store openings in all locations in Japan,
focusing on the Kyusyu area.

Number of Stores by Area
956 stores as ofJanuary 31, 2022

(cumulative)

Hokkaido 21
Kyushu 58

Chiba

Kansai
255東京都
64店舗

Total Number of Gyomu Supper Stores

千葉県
33店舗

地方エリア
315店舗
（＋2）

神奈川県
45

関東直轄
191店舗

Saitama

Kanto

60

55店舗

Kanagawa

260

73

Tokyo

Other

82

362

1,100
1,047

1,050

1,012

1,012 stores as ofJanuary 31, 2023 (+56)

1,000

Hokkaido 28 (+7)

956
950
900

Kyushu 76 (+18)
Kansai

900

Chiba

261
(+6)

850

51
Kanto
276
(+16)

800
FY2021

FY2022

FY2023

FY2023

2021年
Q1

2022年
Q1

2023年
Q1

2023年
Target

1月

1月

1月

10月目標

Saitama

(+6)

65
(+5)

Kanagawa
（＋5）

Tokyo

Other

84

371

(+2)

76
(+3)

(+9)

Directly managed areas: Hokkaido, Kanto, Kansai, and Kyushu
Indirectly managed areas: Other

6◤◤ Year-on-year Changes in Product Shipments to
Gyomu Super Stores◼ Product shipments for each month of FY2023 Q1 increased year on year even after the resumption ofbusiness as usual at restaurants and the lifting of movement restrictions.
<YoY Change(%)><YoY Change(%)> [Existing Stores in Directly Managed Areas]

Monthly Trends for Product Shipments
113.3

115
110.2
110
105.6
105
100

103.6

125
109.9

109.1
107.2
103.9

104.3

103.1

103.1
102.4

105.5

105.3

102.9

101.1

94.4

95

94.2

91.5

90
Nov. 12月
Dec. 1月
Jan.
11月

Feb.
2月

Mar.
3月

FY2021
2021年

Apr.
4月

May
5月

103.5

103.1

103.4 102.9

104.5

115

120.1

119.9
115.3

110.0

112.5

111.2

112.5 113.2

112.7

113.6

113.1

110.8

110.5 110.3

110
105

101.7

Decreased year on year because
the state of emergency announced
in 2020 increased eating-at-homedemand.

FY2022
2022年

118.6

120
105.1

104.9

June July
6月
7月[All Stores Nationwide]
Monthly Trends for Product Shipments

111.6

110.3

111.1

111.5

108.6

110.0

109.3

112.3
108.3

98.9

100

102.4

101.7

95
Nov.
11月 Dec.
12月

Aug.
Oct.
8月 Sept.
9月 10月

Jan.
1月

Feb.
2月

Mar. Apr.
3月
4月

FY2021
2021年

FY2023
2023年

May
5月

June 7月
July
6月

FY2022
2022年

Aug.
8月

Sept. 10月
Oct.
9月

2023年
FY2023[Year-on-year % Changes in Product Shipments to Gyomu Super Stores]
FY2022
Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

H1

May

FY2023
June

July

Aug.

Sept.

Oct.

H2

Full

Nov.

Existing
110.2 102.4 103.1 101.1 105.3 102.9 104.1 103.1 105.5 103.4 104.9 101.7 105.1 103.9 104.0 105.6
storesAll
116.6 108.8 109.3 107.5 111.9 108.6 110.4 108.5 111.7 108.8 110.5 107.9 112.6 110.0 110.2 112.1
storesAll
Nationwide
118.6 110.3 111.2 108.6 113.2 110.5 112.0 110.3 113.6 110.0 112.7 108.3 112.3 111.2 111.6 111.6
storesDirectly
managedareas

Note: “Nationwide” represents the product shipments to the stores in both directly and indirectly managed areas.

Dec.

Jan.

107.2 103.9
112.6 109.5
112.5 109.3
7

◤◤ Kobe Bussan’s Strengths:“Unique Products with Competitive Advantages”
Enhancing Original Products

Samples of Private Label Products

We own 25 food production plants located from Hokkaido to
Yamaguchi (as of January 31, 2023). The number is one of the largest
in Japan’s supermarket industry. Our original products produced atthese plants are available only at Gyomu Super stores and enjoy strong
customer acceptance.

◼ Products produced by Kobe Bussan Group’s plants
Comes in two separate packs for ease of use

Also, food products directly imported from approximately 50 countries
under the concept, “the flavors of the world, to Japan,” are popular with
consumers because they enjoy genuine taste of countries across theworld at reasonable prices at home.

Ratio of Private Label Products (cumulative)
35.0%

34.74%

34.75%

Potato salad
34.74%

34.47%

34.0%

33.0%

32.0%

¥429 (500 g x 2)

Caramel-flavored frozen
cake with custard mousse¥289 (1 pcs)

Mini Daifuku¥300 (850 g)◼ Import products
34.29%
33.01%

32.94%

Q2
2Q

Q3
3Q

32.75%

Q1
1Q
2021年10月期
FY20212022年10月期
FY202233.12%

Q4
4Q
2023年10月期
FY2023

Tempe¥375 (450 g)

Taiwanese
castella¥203 (130 g)

Sea buckthorn juice¥970 (500 ml)

Bargain price : ¥159
Note: All prices include tax.
Products and prices are different depending on stores and seasons.

8◤◤ Restaurant & Delicatessen Business
The Restaurant & Delicatessen Business covers restaurants and delicatessen shops that we operate directly or as afranchisor (franchising headquarters). This business segment includes Kobe Cook World Buffet, a buffet-style restaurant
chain; Premium Karubi, a served a-la-carte buffet style BBQ restaurant chain; and Chisouna, a delicatessen shop chain.
◼

The existing restaurants of Premium Karubi remained
strong.

◼

Kobe Cook World Buffet got back on the track ofgrowth with the number of restaurants and customers
bouncing back.

◼

Chisouna continued opening new shops.

As a result of the above, the segment performance is on atrend toward improvement.
Net Sales<Millions of yen>

Kobe Cook World Buffet

Premium Karubi

Operating Profit<Millions of yen>(cumulative)(cumulative)

2,500

50
30

2,000

10

1,500

5.1%
28

8.0%
3.0%
17
25

-10
2,417

1,000

545

839

FY20 Q1

FY21 Q1

FY23 Q1

0.7%

5.0%

2.0%
-1.0%
-4.0%
-7.0%

-3.9%
-6.1%
FY19 Q1

FY22 Q1

-62

-30

-70

750

0
FY19 Q1

-46

-50

1,592
500

Chisouna

FY20 Q1

FY21 Q1

営業利益
Operating profit-10.0%
FY22 Q1

FY23 Q1

営業利益率
Operating margin

Note: Due to a change in the reportable segment structure in FY2021, the figures for FY2020 are reclassified retrospectively to reflect the change.
9
Accordingly, the figures for these two years are not consistent with those for FY2019 or before.

◤◤ Restaurant & Delicatessen Business
Kobe Cook World Buffet
Total Number of Restaurants: 12 (as of January 31, 2023)

Kobe Cook World Buffet opened 1 restaurant and closed none during FY2023 Q1.
It reopened a restaurant after renovation at Nonoichi-shi, Ishikawa in January.
We aim to raise its awareness by further exposure to local media.

Initiatives to Reduce Food Waste
Harborland Restaurant (located in Chuo-ku, Kobe-shi, Hyogo), which we directly operate, is anexperimental restaurant to work on various initiatives to reduce food waste. Since November
2021, after the last order of lunch and dinner hours, the restaurant has offered 50% discount at
a section in the restaurant designated for selling “by weight” at ¥1.30 (¥1.404 including taxes)
per gram. Such initiatives enhance customer satisfaction of any age and are currently introduced
into 11 restaurants.

Overview of FY2023 & Business Strategy
Since December 2022, all our restaurants have seen an increase in group demand thanks to arecovery in the number of tourists from home and abroad. Sales, especially in Harborland
Restaurant, are approaching the level before the COVID-19 pandemic.
Every season, we run marketing campaigns featuring cuisine of a selected country. In March andApril, we hold the “Italia Fair” to offer elaborate Italian dishes and desserts.

Going forward, we continue to expand takeout menu and offer services that satisfy customers

Seasonal limited: “Italia Fair”

with the menu, volume of food and price unparalleled to any other restaurant chains.
10◤◤ Restaurant & Delicatessen BusinessPremium Karubi
Total Number of Restaurants: 17 (as of January 31, 2023)

Premium Karubi opened 1 restaurant and closed none during FY2023 Q1.
Despite the price revision as a measure against soaring purchase prices, a higher price range menu is also wellreceived.

It is actively posting information on Instagram (@premiumkarubi).

Differentiation from Other Competitors
What makes Premium Karubi different from other BBQ restaurants isthe best selected, perfectly aged meat and in-house made desserts
and gelatos. The restaurants offer new menus for each season sothat repeat customers can enjoy our meals. We are running amarketing campaign titled “South Korea Fair” from March 7 to May 31.
Also, our dessert buffet uses seasonal ingredients every season.
From March, we are offering springlike desserts featuring strawberry
and cherry blossom flavors, which are well received by customers.

Restaurants Opened during FY2023
Lake Town

5-1-2 Lake Town, Koshigaya-shi, Saitama

The first store in Shizuoka opened in February,which got a lot of exposure to media.
Note: Menus may vary by restaurant and season.

* We plan to open new restaurants onwards in phases.
11◤◤ Restaurant & Delicatessen Business
Chisouna
Total Number of Shops: 92 (as of January 31, 2023)

Chisouna opened 5 shops and closed none during FY2023 Q1.
A significantly increased number of shops and price revisions helped
improve its profitability.
We anticipate opening the 100th shop in the current fiscal year.

Factors behind Strong Performance
Despite continuous soaring prices of raw materials, Chisouna
maintains a price advantage by working on price revisions, menuchanges, and improvement in cooking operations efficiency. In
addition, a strong synergy effect on attracting more customers to
Gyomu Super stores is accelerating the willingness of franchisees
to open new shops. The voluminous fresh homemade foods keep
attracting customers.

Recent Development
Approximately 40% of Gyomu Super stores that opened during
FY2022 had a Chisouna section.
In December 2022, we introduced a new format in which a
Chisouna section was established in a drugstore. As such, we

continue to expand the number of shops without limiting thoseestablished in Gyomu Super stores.
Note: Products and prices may vary by shop and season.

12◤◤ Eco Renewable Energy BusinessWe provide eco-friendly, safe, and reliable renewable energy by operating solar andwoody biomass power plants.
◼ Operating profit for FY2023 Q1 declined year on
year due to the recording of depreciation of asolar power plant in Nishigo-mura,Nishishirakawa-gun, Fukushima, which started
operations in June 2022.
◼ An expected rise in operations of our solar
power plants from spring will increase operating
profit for the full year of FY2023.
◼ In spring 2024, we plan to start operating a solar
power plant in Miyagi.
Net Sales<Millions of yen>

Kobe Bussan’s Solar Power Plant(Photo: Nishishirakawa Power Plant with the capacityof 18.9 MW, which started operations in June 2022)

Kobe Bussan’s Woody Biomass Power Plant

Operating Profit<Millions of yen>(cumulative)(cumulative)

800

100

20.0%
15.3%

80

15.0%

700
60

89

40

600
702
500
528

537

FY19 Q1

FY20 Q1

581

636

3.8%
20

0

FY21 Q1

FY22 Q1

FY23 Q1

6.3%
60

46

44

20
FY19 Q1

400

9.6%

8.6%

10.0%
5.0%

0.0%
FY20 Q1

FY21 Q1

営業利益
Operating profit

FY22 Q1

FY23 Q1

営業利益率
Operating margin13◤◤ Eco Renewable Energy Business
Plant Locations

Solar Power:[Biomass]
Shiranuka-cho,
Hokkaido
6.2 MW

18 locations

51.0 MW

1 location

6.2 MW

Biomass:[Solar Power]
5 in Hokkaido
5.9 MW(as of January 31, 2023)[Solar Power]
1 in Shiga
0.5 MW[Solar Power]
4 in Hyogo
4.5 MW[Solar Power]
1 in Fukushima
18.9 MW[Solar Power]
1 in Fukuoka
0.9 MW[Solar Power]
1 in Ibaraki
2.4 MW[Solar Power]
3 in Osaka
14.2 MW[Solar Power]
1 in Tokushima
2.1 MW[Solar Power]
1 in Wakayama
1.6 MW

14◤◤ Shareholder Returns
Dividends<Yen>

Kobe Bussan regards returning profits to shareholders as one of key

Dividend per Share25

management issues. Our basic policy is to secure funds necessary forour business growth and distribute profits to shareholders according to20

the operating results.

21.5%

17.8%

22.1%

23.1%

23.0%

20%

15

For FY2022, we paid the annual year-end dividends of ¥22.00 per share,up ¥1.00 from the initial forecast of ¥21.00.

15%

10
5

For FY2023, we plan to pay the annual dividends of ¥22.00 per share.

0
Note: The figures in the graph on the right have been adjusted for the effect of

25%

20.00

22.00

22.00

15.00

5%

10.00
FY20192019年

the 2-for-1 stock splits carried out in November 2019, and November

FY2021
FY20202020年
2021年
Dividend per share
1株当たり配当金10%

FY2023
FY2022
2022年
2023年予想
TargetPayout ratio
配当性向(連結)

0%

2020.

Shareholder Benefit Program
The shareholder benefit program has been introduced to express Kobe Bussan’s gratitude for the continuous support of its shareholders
and to gain the deeper understanding of customers for its businesses. We will send JCB Gift Card to shareholders who hold 100 shares ormore as of October 31 of each year, according to the number of years of ownership and the number of shares held.
Shareholder incentives
Number of shares held

Continuous ownership years
Less than 3 years

Continuous ownership years
3 years or more

100-999

JCB Gift Card ¥1,000

JCB Gift Card ¥3,000

1,000-1,999

JCB Gift Card ¥10,000

JCB Gift Card ¥15,000

2,000 or more

JCB Gift Card ¥15,000

JCB Gift Card ¥20,000

Note: Shareholders may opt to exchange the gift cards for an assortment of private label products worth the face value.

Sample15

◤◤ Consolidated Financial Forecast
FY2023 Forecast(Millions of yen)

Full-year forecast

Progress towards
Full-year forecast

107,942440,000

24.5%

Operating profit

6,338

29,700

21.3%

Profit attributable toowners of parent

1,348

21,200

6.4%

Q1 actual
Net sales[Note]• The above forecast reflects the assumption that the weak yen against US dollar will continuingly
increase the cost of imported products as well as the costs of raw materials and infrastructure.
•

The full-year forecast has been determined to remain unchanged at the moment, considering
the recent currency movement.

Gyomu Super Business Guideline towards FY2023 Forecast
FY2023 target

Action plan

Target ofstore openings

Net increase of
40 stores

Open stores focusing on the Kanto and Kyushu areas under
direct management.
Strengthen property data-gathering capability driven byheadquarters.

Product
development

Rise in PB ratio

Focus on private label products developed by our groupplants and those imported directly by ourselves.
16• This material contains forward-looking statements based onassumptions, estimates, and plans as of March 14, 2023.

• Please note that actual results may differ significantly from theseforward-looking statements due to uncertain factors arising fromchanges in the economic climate.
• This material is not intended to solicit and encourage purchase ofshares.
• This material has been translated from the Japanese original forreference purposes only. In the event of any discrepancy between
this translated material and the Japanese original, the original shallprevail.

For information regarding this material, please contact:
IR-Public Relations, Kobe Bussan Co., Ltd.
ir@kobebussan.co.jp
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