Financial Results for the Six Months Ended
August 31, 2022
AEON DELIGHT CO., LTD.
Kazumasa Hamada,President and CEO, Group CEO
October 4, 2022

Contents

1

Financial Report for FY2/23 1H

2

Initiatives for 2H©2022 AEON Delight All Rights Reserved2Consolidated Statement of Income
Sales increased but profits decreased YoY, showing a slow growth compared to the initial plan.
COVID-19 and the Ukrainian crisis had a 600 million yen of negative impact on our operating income for the first half.

FY2/22 1H(Ratio to sales)

Net sales[Former Revenue
Recognition Standard]

FY2/23 1H(Ratio to sales)(100 million yen)

Difference

PercentagechangeVs.
FY2/20 1H

1,465
1,476（100.0%）［1,639］［1,653］(100.0%）10［14］

100.7%［100.9％］106.2%［105.0％］196（13.3%）▲895.8%99.2%

130（8.8%）9108.1%116.4%

66（4.5%）▲1878.3%

76.8%

Gross profit

204（14.0%）

SG&A expenses

120（8.2%）

Operating income

84（5.8%）

Ordinary income

84（5.8%）66（4.5%）▲1877.8%

76.3%

55（3.8%）43（2.9%）▲1278.0%

83.7%

Net incomeattributable toowners of parent* Figures for change, difference, and comparison with the FY2/20 1H are reclassified under the new revenue recognition standard and compared under the same standard
for the same period of the previous year and the same period of FY2/20.
Figures in square brackets are comparisons with the same basis under the old revenue recognition standard.
* (Ratio to sales) is calculated based on the new revenue recognition standard.
3©2022 AEON Delight All Rights Reserved

Sales by Segment
Sales increased in 5 businesses and decreased in 2 businesses due to expansion of market share among existing customers anddevelopment of new customers.
Cleaning services: Decrease in sales due to lower demand for alcohol disinfection cleaning services(100 million yen)
Construction work: Sales down sharply due to cancel or postponement of customers' capital investment plans
and material shortages and procurement delays
Vs.
FY2/22 1H
FY2/23 1H
Difference
FY2/20 1H
Facilities management

310

322
［322］

104.0%［104.2%］108.9%［109.2%］

Security services

236

241

102.0%

108.8%

Cleaning services

341

337

99.0%

109.2%

Construction work

247

233

94.2%

101.1%

202［287］

204
［292］

101.2%［101.6％］113.0%［112.9％］

47
［135］

47
［136］

100.3%［100.5％］88.6%［84.7％］

8089

110.7%

92.4%

1,465
［1,639］1,476［1,653］100.7%［100.9％］106.2%［105.0％］Materials/supplies
sourcing services[Former Revenue Recognition
Standard]

Vending machineservices[Former Revenue Recognition
Standard]

Support services
Total[Former Revenue Recognition
Standard]©2022 AEON Delight All Rights Reserved4

Profit by Segment
Profits increased in 3 businesses and decreased in 4 businesses.
Security services: Decrease in orders for safety cameras
Cleaning services: Decrease in orders for alcohol disinfection cleaning services
Construction work: Decrease in net sales and orders for small-scale repair construction
Materials/supplies sourcing services: Increase in purchasing cost

FY2/22 1H(100 million yen)

FY2/23 1H

DifferenceVs.
FY2/20 1H

Facilities management

26.2

28.2

107.7%

101.3%

Security services

17.0

14.4

84.8%

102.2%

Cleaning services

42.7

33.2

77.8%

94.8%

Construction work

22.5

14.0

62.5%

64.6%

Materials/supplies
sourcing services

13.6

9.9

73.0%

73.4%

Vending machineservices

3.5

5.5

157.3%

78.9%

Support services

2.5

2.7

109.5%

110.0%

128.2

108.3

84.5%

88.8%

Total

©2022 AEON Delight All Rights Reserved5Consolidated Balance Sheet(100 million yen)
Liabilities andnet assets

DifferenceAssets

2022/22022/8Current assets

1,210

1,251

41

Current
liabilities

438

459

20

Tangible fixedassets

7069▲1Fixedliabilities

3531▲4Intangible
fixed assets

56648474490

15

Investments,etc.

9186▲4Shareholder’sequity

929

941

11

Fixed assets

218

220

1

Total net assets

954

981

27

Total assets

1,428

1,471

43

Total liabilities
and net assets

1,428

1,471

43

Difference

Totalliabilities

2022/22022/8©2022 AEON Delight All Rights Reserved

6Consolidated Statement of Cash Flows(100 million yen)2021/8Difference2022/8Cash flows fromoperating activities

17

Cash flows frominvesting activities▲4▲59▲55

Cash flows fromfinancing activities▲24▲204

Cash and cash
equivalents at theend of year583

9▲8(100 million yen)
Operating CF
営業ＣＦ

InvestingCF
投資ＣＦ

FinancingCF
財務ＣＦ40200(20)
(40)
(60)

614

31(80)
FY8/21

FY8/22©2022 AEON Delight All Rights Reserved7

Major Initiatives in FY2/23 1H ① Development of Area Management
Accelerated the development of "area management", a new facility management
model, to build a sustainable business model

Reorganized area branch system under all 8
domestic branch offices as the reorganization
plan in April 2022.
Designed areas based on customer needs andfacility/regional characteristics, and developed anationwide "area management" system.

At the same time, we have made progress inautomating inspection operations through theintroduction of cameras and sensors andconsolidating operations at customer support
centers, resulting in the following results.
Labor-saving at 70 new facilities(248 facilities in total)●Customer support centers with remote
Aim to redeploy 26 specialized personnel
monitoring functions are set up under the control of (141 in total)
8 branch offices nationwide.
to capture new opportunities to gain revenues©2022 AEON Delight All Rights Reserved8Major Initiatives in FY2/22 1H ② Business Expansion in Asia
Sales increased in both China and ASEAN businesses (130.2% YoY)
On the other hand, operating income in overseas business decreased (92.1% YoY) due to increased costs forstrengthening governance in China and higher labor costs following the revision of Indonesian law.
In China, we will change the corporate form of AEON DELIGHT（CHINA） to an investment company
in order to accelerate business expansion throughout China（Oct. 2022）
In the ASEAN region, where further growth is expected in the mid- to long-term, we have begun preparations
to establish an ASEAN headquarters where we have taken the lead in strengthening our management base.
(Net sales：
100 million yen)

(Operating income：

ChinaMalaysia

Vietnam

160120Indonesia

Operating income

100 million yen)

12153.4

117.8

98.6
7.980

640

30

Net sales
FY2/22 1H

Operatingincome

Net sales*Fiscal-year end for the overseas business is December 31. Figures are simple sum of operating companies.

FY2/23 1H

Operatingincome0©2022 AEON Delight All Rights Reserved9Contents

1

Financial Report for FY2/23 1H

2

Initiatives for 2H©2022 AEON Delight All Rights Reserved

10Factor Analysis of Consolidated Business Results for 1H and Measures for 2H
Results for 1H

Policies and Assumptions for 2H① Shortage of various materials and equipment due to COVID-19and Ukrainian situation, delays in procurement, etc. affectedsales in each segment.

① Although the procurement of materials and equipment remains,there has been a considerable improvement, and a portion ofshortages and delays will be incorporated in the 2H of the fiscalyear.

② Impact on the Construction work business due to customers'
cancellation and postponement of capital investment plansreflecting to changes in the environment.

② Amid rising energy costs for facilities, strengthen energy-saving
proposals that leverage our expertise in LEDs, air conditioning
control, and sales of non-fluorocarbon cases to help customers
solve their issues. Receive orders for earthquake recoveryrelated construction in the Tohoku region③ Decreased profitability of the security services due to adecrease in orders for safety cameras, etc.

③ Improve profitability by continuing initiatives throughsystemization of store entry and exit management and store
closure operations, price negotiations, etc.

④ Decline in sales of the Cleaning services business due to adecrease in demand for alcohol sanitizers④ Excluding alcohol disinfection, base sales will continue toincrease in the first half of the year.
In the second half, the year-on-year impact of alcohol sanitationand cleaning decreased significantly.
Continuing from the first half, we will secure an increase insales in the second half by expanding renewal contracts.

⑤ Decline in profitability of the Materials/supplies sourcing
services business due to increase in purchasing costs reflecting
increases in raw materials, logistics costs, etc.

⑤ In addition to streamlining logistics costs, we will strive to reflect
rising costs in appropriate selling prices. Agreements on pricerevisions with customers are in progress⑥ Increase in expenses due to increased upfront investments,including for DX.

⑥ Steadily make investments necessary for future growth, whileassessing the effects©2022 AEON Delight All Rights Reserved

11

Business Forecasts for FY2/23(100 million yen)

FY2/22 Result(Ratio to sales)

FY2/23 Forecast(Ratio to sales)

New revenue recognition standard

New revenue recognition standard

2,839 （100.0%）
Net sales

Former revenue recognition standard

3,176 （100.0%）

3,100 （100.0%）

Difference

109.2%

Former revenue recognition standard

3,470 （100.0%）

109.3%

Operating income

157（5.0%）

170（5.5%）

108.3%

Ordinary income

157（4.9%）

170（5.5%）

109.0%Net income attributableto owners of parent

106（3.4%）

107（3.4%）

100.0%* Figures (Ratio to sales) for FY2/2022 are based on the former revenue recognition standard, and figures for FY2/23 arebased on the new revenue recognition standard.
* Estimated impact of COVID-19 on operating income in FY2/23: -800 million yen (-1.2 billion yen in FY2/22)©2022 AEON Delight All Rights Reserved

12Progress in KPIs (Key Performance Indicators) of the Medium-Term Management Plan

Basic
PolicyCustomeroriented
management

Promotion ofDX

KPI (End-FY2/24)
Ratio of sales inside/outside the AEON Group
60%:40%Operating income margin of 6.0%,
sustaining the standard of ROE 12% (full-year) throughincreasing operating income
Number of facilities introducing area management: 360
Reduction in number of on-site staff through area
management: 180

Progress in FY2/23 1H

End-FY2/22

63.7%：36.3%

64.4%：35.6%

Operating income margin:4.5%
ROE: －％※

Operating income margin:
5.0%
ROE: 11.7％

248 facilities

178 facilities

141 staffs

115 staffs

ー※Began to improve businessprocesses in the head officedivisionー※52.1 billion yen

10.4％

7.8％

ー※

Started providing support fromour finance and accounting
department for all domestic
group companies.

Allocation of 20% of staffs in the headquarters to front
office by consolidatinghead office functionsGroupmanagement

Net sales of 65.0 billion yen consolidated with groupcompanies in JapanNet sales ratio of Asia businesses over 8%
Shift to shared services for domestic group finance andaccounting departments (full-year)

Items in blue indicate improvements.
*Some indicators were updated on a full-year basis.

©2022 AEON Delight All Rights Reserved 13

Acquisition of Treasury Shares
Acquire treasury shares to improve capital efficiency and increase
shareholder returns

1.5

We will acquire up tomillion shares, equivalent to 3.0%of the total number of shares issued (excluding treasury stock)(Repurchase period: October 5, 2022 to October 4, 2023)

Improve capital efficiency and increase shareholder returns©2022 AEON Delight All Rights Reserved14

If you have any questions or comments, please contact us below.
■ These materials contain statements about forecasts and estimates relating to the future plans, strategies, andperformance of AEON DELIGHT.
These statements are based not only on past performance, but also on assumptions based on information currently
available to the company. For this reason, please note that the actual performance may differ from our estimates.
■ The information contained in these materials has been prepared by the following methods if not specifically statedotherwise.
◇ All statements are based on consolidated results◇ Figures are rounded down to the nearest 100 million yen.
*Figures on page 5, 9 (Operating income) are rounded down to the nearest 10 million yen.
◇ Percentages have been rounded off to one decimal place
IR Contact : President’s Office, PR・IR GroupTEL 03-6895-3892

AEON DELIGHT CO., LTD.
(Securities Code: 9787)

Please contact us on our website.
https://www.aeondelight.co.jp

Based on information available up to the date of publication (October 4, 2022)
These forecasts have been prepared and are subject to change due to various factors going forward.