Summary of Consolidated Financial Results
for the Third Quarter of the Fiscal Year Ending February 28, 2023
(Nine Months Ended November 30, 2022)[Japanese GAAP]
December 29, 2022

Company name: Adastria Co., Ltd.
Listing: Tokyo Stock Exchange
Stock code:
2685
URL: https://www.adastria.co.jp
Representative: Osamu Kimura, Representative Director and President
Itsuo Iwakoshi, Senior Executive Officer,
Contact:
Head of Corporate Planning OfficeTel: +81-3-5466-2060
Scheduled date of filing of Quarterly Report:
January 13, 2023
Scheduled date of payment of dividend:
Preparation of supplementary materials for quarterly financial results: Yes
Holding of quarterly financial results meeting:Yes (for investors)
Note: The original disclosure in Japanese was released on December 29, 2022 at 15:30 (GMT +9).
(All amounts are rounded down to the nearest million yen)

1. Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending February 28, 2023
(March 1, 2022 – November 30, 2022)(1) Consolidated results of operations (cumulative)
Net sales
Million yen(Percentages represent year-on-year changes)
Net income
Ordinary profit
attributable to ownersof the parent

Operating profit%

Million yen%

Million yen%

Million yen

Nine months ended Nov. 30, 2022
177,026
20.6
11,165149.0
11,805 106.2
Nine months ended Nov. 30, 2021
146,731
10.5
4,483
304.6
5,725
83.7
Note: Comprehensive income
Nine months ended Nov. 30, 2022: 8,419 million yen (up 125.5%)
Nine months ended Nov. 30, 2021: 3,734 million yen (up 297.4%)
Net income per share

Diluted net income per share

Yen

Yen

Nine months ended Nov. 30, 2022
Nine months ended Nov. 30, 2021

168.09
78.16

%

7,616
3,534

115.5
187.6

-

(2) Consolidated financial position
Total assets

Net assets

Equity ratio

Million yen

Million yen%

As of Nov. 30, 2022
123,853
61,16948.2
As of Feb. 28, 2022
97,95754,963
55.1
Reference: Shareholders’ equity As of Nov. 30, 2022: 59,749 million yen
As of Feb. 28, 2022: 53,963 million yen
Note: At the end of the previous fiscal year, the provisional accounting treatment for the business combination was finalized , and,for the fiscal year ended February 2022, the initial allocation of acquisition costs due to the provisional finalization of
accounting treatment was significantly revised. The reported amounts reflect these changes.

2. Dividends
1Q-end2Q-endDividend per share
3Q-endYear-end

Total

Yen

Yen

Yen

Yen

Yen

Fiscal year ended Feb. 28, 2022
25.00
Fiscal year ending Feb. 28, 2023
25.00
Fiscal year ending Feb. 28, 2023 (forecast)
Note: Revision to the most recently announced dividend forecast: Yes

-

30.00

55.00

35.00

60.00

3. Consolidated Forecast for the Fiscal Year Ending February 28, 2023 (March 1, 2022 – February 28, 2023)
Net sales
Million yen

Operating profit%

Million yen%

Ordinary profit
Million yen

Full year
240,000
19.1
12,50090.4
13,000Note: Revision to the most recently announced consolidated forecast: Yes(Percentages represent year-on-year changes)
Net income attributable Net income per
to owners of the parent
share

%

59.2

Million yen

8,200

%

66.8

Yen

180.81

* Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changes inscope of consolidation): None
Newly added: -Excluded: -(2) Application of special accounting methods for presenting quarterly consolid ated financial statements: None
(3) Changes in accounting policies and accounting-based estimates, and restatements
1) Changes in accounting policies due to revisions in accounting standards, others: Yes
2) Changes in accounting policies other than 1) above: Yes
3) Changes in accounting-based estimates: None
4) Restatements: None
Note: Please refer to the section “2. Quarterly Consolidated Financial Statements and Notes, ( 3) Notes to Quarterly
Consolidated Financial Statements, Changes in Accounting Policies” on page 9 for further information.

(4) Number of outstanding shares (common stock)1) Number of shares outstanding at the end of the period (including treasury shares)
As of Nov. 30, 2022:
48,800,000 shares
As of Feb. 28, 2022:

48,800,000 shares

2) Number of treasury shares at the end of the period
As of Nov. 30, 2022:
3,449,059 shares

As of Feb. 28, 2022:

3,552,459 shares

3) Average number of shares outstanding during the period
Nine months ended Nov. 30, 2022: 45,313,566 shares

Nine months ended Nov. 30, 2021: 45,224,082 shares

Note 1: The current quarterly financial report is not subject to quarterly review procedures by certified public accountants or
auditing firms.
Note 2: Cautionary statement with respect to forward-looking statements
Forward-looking statements in this report are based on currently available information and certain assumptions judged to bereasonable. Actual results may differ significantly from these forecasts for a number of factors. Please refer to the section “1.
Qualitative Information on Quarterly Consolidated Financial Performance, (3) Explanation of Consolidated Forecast andOther Forward-looking Statements” on page 4 regarding preconditions or other related matters for the forecast shown above.

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

Contents of Attachments
1. Qualitative Information on Quarterly Consolidated Financial Performance2(1) Explanation of Results of Operations

2(2) Explanation of Financial Position

3(3) Explanation of Consolidated Forecast and Other Forward-looking Statements

4

2. Quarterly Consolidated Financial Statements and Notes

5(1) Quarterly Consolidated Balance Sheet

5(2) Quarterly Consolidated Statements of Income and Comprehensive Income

7(3) Notes to Quarterly Consolidated Financial Statements

9

Going Concern Assumption

9

Significant Changes in Shareholders’ Equity

9

Changes in the Scope of Consolidation or Application of the Equity Method

9

Changes in Accounting Policies

9

Segment Information

10

Subsequent Events

11

3. Supplementary Information

12(1) Sales for Brands and Regions

12(2) Sales for Merchandise Categories

12(3) Number of Stores

13

- 1 -

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

1. Qualitative Information on Quarterly Consolidated Financial Performance(1) Explanation of Results of Operations
Consolidated results
First nine months of FY2/22
First nine months of FY2/23(Mar. 1, 2021 – Nov. 30, 2021) (Mar. 1, 2022 – Nov. 30, 2022)
146,731
177,026

Net sales

YoY change(Amount)
30,294(Million yen)
YoY change
(%)
20.6

Operating profit

4,483

11,165

6,681

149.0

Ordinary profit
Net income attributableto owners of the parent

5,725

11,805

6,080

106.2

3,534

7,616

4,081

115.5

During the first nine months (March 1 – November 30, 2022) of the current fiscal year, the business climate wasbetter than one year earlier as the end of many pandemic restrictions resulted in a recovery of outings andnormalization of personal consumption. Market conditions improved even though lockdowns in Shanghai createdsupply chain disruptions in May and June and the Omicron variant sparked another wave of the pandemic in July.
Sales at all stores and existing stores were higher than one year earlier i n every month of the first nine months of
the fiscal year. The outlook for the economy remains uncertain because of the yen’s rapid depreciation and therising cost of resources and energy because of the Ukraine crisis. However, the desire of consumers to buy
apparel and other fashion products remains strong.
The Adastria Group announced a medium-term management plan on April 13, 2022 with the following strategies
for growth and is taking numerous actions to accomplish these goals.
Growth Strategy Ⅰ

Multi-Brand, Multi-Category

Growth Strategy IⅠ Digital Customer Interactions and Services
Growth Strategy ⅠII Glocal
Growth Strategy ⅠV New BusinessGrouping of brands according to roles for improved
profitability and growth
Accelerate growth of our EC site and create a fun EC
community
Develop models in Mainland China and cultivate
Southeast Asia
Establish a food and beverage business and create new
appealConsolidated net sales increased 20.6% year-on-year to 177,026 million yen, operating profit increased 149.0%
to 11,165 million yen, ordinary profit increased 106.2% to 11,805 million yen, and net income attributable toowners of the parent increased 115.5% to 7,616 million yen.
As a result of Zetton, Inc. becoming a consolidated subsidiary in February 2022, Adastria is reporting theApparel and Sundry Goods-related Business and Other (Food and Beverage Business) as separate businesssegments beginning with the current fiscal year.
In the Apparel and Sundry Goods-related business segment, sales in Japan were up 14.3% from one year earlier.
The main reasons are the reduction of restrictions on store operations, favorable spring and summer weather,strong sales of apparel to meet the rising demand for clothing for outings, several hit products, and promotional
measures such as TV commercials and point redemption .
In the Other segment, sales increased due to the acquisition of Zetton, Inc., which operates a food and beveragebusiness in line with Adastria’s growth strategy.
As part of its digital strategy, Adastria has continued to attract customers through TV commercials and otheractivities to raise awareness of its “Dot ST” e-commerce website in the third quarter, same as in the first quarter.
Activities include adding merchandise of other companies to enlarge the lineup of products. As a result, thenumber of members of this website is now 15.1 million, 1.5 million more than at the end of the previous fiscal
year. Although pace of sales growth was held down because of the recovery of demand at physical stores,
e-commerce sales continue to increase with these sales up 6.9% in the first nine months from one year earlier.
In Mainland China, sales were down 2.3% year-on-year because of lockdowns and other measures in response to
the emergence of a new COVID-19 variant. Sales increased 15.5% in Hong Kong as a second quarter recovery- 2 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Yearand the addition of a new store offset the impact of pandemic restrictions in the first quarter. In Taiwan, sales
were up 58.2% due to the success of a new brand. In the United States, sales rose 53.2% because of strong
consumer spending, growth of wholesale sales because of quality improvements, and higher e -commerce sales.
As a result, total overseas sales were up 35.9% and the overseas business was profitable in the first nine months.
All overseas sales information is based on conversions to yen of sales in local currencies.
Despite the negative effects of the yen’s depreciation and high prices of raw materials, the gross profit margin of
the Apparel and Sundry Goods-related Business was basically unchanged from the same period in the previous
fiscal year because we are supplying products at the right times, prices and volumes, holding down discountsales, and increasing the added value of our products. Another reason is revisions of prices of some merchandise
to maintain the proper balance with the value of these products. In addition, as the share of the food and beveragebusiness increased due to the acquisition of Zetton, Inc. which is now a consolidated subsidiary, the gross profit
margin increased 0.7 percentage point from one year earlier to 56.4%.
Selling, general, and administrative expenses increased mainly because of higher personnel expenses and store
leasing expenses, and an increase in advertising and promotion expenses resulting from numerous promotional
activities following the reduction of these activities, due to store closures and shortened business hours in theprevious fiscal year. But sales recovered and business operations became more efficient. As a result, the SG&A tosales ratio improved by 2.5 percentage points from one year earlier to 50.1%, and operating profit significantly
improved.
Non-operating income includes a subsidy of 212 million yen related to shortened operating hours caused by the
pandemic, employment adjustment subsidies of 37 million yen and foreign exchange gains of 459 million yen. A
loss on valuation of derivatives of 106 million yen related to shutting down the South Korean business wasrecorded as a non-operating expense.
Business segment performance was as follows.
1) Apparel and Sundry Goods-related BusinessAs a result of the above, sales were 169,302 million yen and segment profit was 11,638 million yen.
Seven stores were added to this business because OPEN AND NATURAL Inc. became a consolidated subsidiaryin the first quarter. In addition, we opened 82 stores (including 17 overseas) and closed 43 stores (including 3
overseas), resulting in a total of 1,469 stores (including 87 overseas) at the end of the first nine months of thecurrent fiscal year.
2) Other (Food and Beverage Business)
Sales were 7,750 million yen and segment profit was 167 million yen.
The number of stores at the end of the first nine months was 75, a result of the increase of 73 stores due to theacquisition of Zetton, Inc. at the end of the previous fiscal year and opening of 4 stores and closing of 7 stores.
(2) Explanation of Financial Position
Total assets increased 25,895 million yen from as of February 28, 2022 to 123,853 million yen as of November
30, 2022. There were increases of 8,929 million yen in notes and accounts receivable-trade, 9,859 million yen in
inventories, and 5,412 million yen in other, net under property, plant and equipment, partly because ofright-of-use assets, etc., resulting from the application of the new lease acc ounting standard (ASC No. 842), etc.,
by the U.S. subsidiary.
Liabilities increased 19,689 million yen to 62,683 million yen. There were increases of 5,469 million yen innotes and accounts payable-trade, 5,475 million yen in short-term borrowings, 3,942 million yen in accounts
payable-other, and 3,326 million yen in other under current liabilities, including contract liabilities arising fromthe adoption of the revenue recognition accounting standard and leas e liabilities resulting from the application of
the new lease accounting standard (ASC No. 842) by the U.S. subsidiary, etc.
Net assets increased 6,206 million yen to 61,169 million yen. This was mainly due to a decrease of 350 million
yen in treasury shares (increase in net assets), and increases of 4,930 million yen in retained earnings and 702- 3 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Yearmillion yen in foreign currency translation adjustment.
(3) Explanation of Consolidated Forecast and Other Forward-looking Statements
As is explained in this earnings report, sales and earnings during the first nine months were strong. Due to theoutlook for fiscal year sales and earnings to be higher than in the forecast announced on April 13, 2022, theforecast for the fiscal year ending in February 2023 has been revised. More information is in the December 29,
2022 press release concerning this revision “Notice Concerning Revisions to Consolidated and Non-Consolidated
Earnings Forecasts for the Fiscal Year Ended February 2023 and Upwar d Revision of Dividend Forecast” postedon the corporate website.

- 4 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

2. Quarterly Consolidated Financial Statements and Notes(1) Quarterly Consolidated Balance Sheet(Million yen)
Third quarter of FY2/23(As of Nov. 30, 2022)

FY2/22(As of Feb. 28, 2022)
AssetsCurrent assets
Cash and deposits

16,976

16,441

Notes and accounts receivable-trade

9,878

18,807

Inventories

19,25929,119

Other

2,126

1,972

Allowance for doubtful accounts

(71)

(129)

48,16966,211

Total current assets
Non-current assets
Property, plant and equipment
Store interior equipment, net

4,404

5,982

Other, net

11,60017,013

Total property, plant and equipment

16,00522,996

922

1,404

Other

9,914

10,673

Total intangible assets

10,836

12,078Intangible assets
Goodwill

Investments and other assets
Investment securities

1,003

1,179

Leasehold and guarantee deposits

15,426

14,136

Other

6,866

7,587

Allowance for doubtful accounts

(351)

(336)

Total investments and other assets

22,94522,566

Total non-current assets

49,78757,641

97,957

123,853

Notes and accounts payable-trade

11,282

16,752

Electronically recorded obligations-operating

6,620

8,364

95

5,570

Total assets
Liabilities
Current liabilities

Short-term borrowings
Current portion of long-term borrowings

455

379

Accounts payable-other

10,44914,392

Income taxes payable

3,247

3,188

Provision for bonuses

2,179

1,187

Provision for point card certificates

1,728

136

Other provisions

446

562

Other

1,910

5,237

Total current liabilities

38,41655,770896

618

Non-current liabilities
Long-term borrowings
Provisions
Other
Total non-current liabilities
Total liabilities

- 5 -

322

-

3,358

6,294

4,577

6,913

42,99462,683

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

(Million yen)
Third quarter of FY2/23(As of Nov. 30, 2022)

FY2/22(As of Feb. 28, 2022)
Net assets
Shareholders’ equity
Share capital

2,660

2,660

Capital surplus

7,213

7,213

Retained earnings

51,11456,044

Treasury shares(7,636)(7,285)

Total shareholders’ equity

53,351

58,632895

Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

45

(238)

Foreign currency translation adjustment

558

1,260

Total accumulated other comprehensive income

611

1,117

Non-controlling interests

1,000

1,419

Total net assets

54,963

61,16997,957

123,853

Total liabilities and net assets- 6 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

(2) Quarterly Consolidated Statements of Income and Comprehensive Income
Quarterly Consolidated Statement of Income(For the Nine-month Period)First nine months of FY2/22(Mar. 1, 2021 – Nov. 30, 2021)(Million yen)First nine months of FY2/23(Mar. 1, 2022 – Nov. 30, 2022)

Net sales

146,731

177,026

Cost of sales

65,05877,238Gross profit

81,67399,787

Selling, general and administrative expenses

77,18988,622

Operating profit

4,483

11,165

Foreign exchange gains

240

459

Subsidy income

471

212

Subsidies for employment adjustment

486

37

Other

260

229

1,459

938

Interest expenses

109

134

Loss on valuation of derivatives

55

106

Non-operating income

Total non-operating income
Non-operating expenses

Other

52

57

Total non-operating expenses

218

298

5,725

11,805Gain on liquidation of subsidiaries and associates

81-

Reversal of allowance for doubtful accounts

264-

Total extraordinary income

346-

Impairment loss

321

50

Total extraordinary losses

321

50

Net income before income taxes

5,750

11,754

Income taxes-current

2,526

4,371

Income taxes-deferred

(310)

(530)

Total income taxes

2,216

3,841

Net income

3,534

7,913

（0）

297

3,534

7,616

Ordinary profit
Extraordinary income

Extraordinary losses

Net income (loss) attributable to non-controlling interests
Net income attributable to owners of the parent- 7 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

Quarterly Consolidated Statement of Comprehensive Income(For the Nine-month Period)First nine months of FY2/22(Mar. 1, 2021 – Nov. 30, 2021)(Million yen)First nine months of FY2/23(Mar. 1, 2022 – Nov. 30, 2022)

3,534

7,913

Other comprehensive income
Valuation difference on available-for-salesecurities
Deferred gains or losses on hedges

(2)

87

(4)

(283)

Foreign currency translation adjustment

206

702

Net income

Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of
the parent
Comprehensive income attributable tonon-controlling interests

- 8 -

199

505

3,734

8,419

3,734

8,000

(0)

419

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

(3) Notes to Quarterly Consolidated Financial Statements
Going Concern Assumption
Not applicable.
Significant Changes in Shareholders’ Equity
Not applicable.
Changes in the Scope of Consolidation or Application of the Equity Method
Important changes in the scope of consolidation
Following the acquisition of shares in OPEN AND NATURAL Inc. through the Company ’s consolidated
subsidiary BUZZWIT Co., Ltd. on March 31, 2022, OPEN AND NATURAL became a consolidated subsidiary(sub-subsidiary) from the first quarter of the current fiscal year. However, only the balance sheet of OPEN AND
NATURAL was included in the consolidation as the deemed acquisition dat e was April 30, 2022 and the period
to date of the closure of quarterly consolidated accounts did not exceed three months. The statement of income ofthis company has been included in the consolidation since the second quarter of the current fiscal year .
Changes in Accounting Policies
Application of Accounting Standards for Revenue Recognition
The Company has applied the Accounting Standard for Revenue Recognition (Accounting Standards Board ofJapan (ASBJ) Statement No. 29, March 31, 2020) and other standards from the beginning of the first quarter ofthe current fiscal year. Based on these standards, revenue expected to be received in exchange for the provisionof goods and services is recognized when the control of the goods and services is transferred to customers. In
prior years, to prepare for the redemption of the points granted on sales t o customers, the Adastria Group
recorded a provision for point card certificates in an amount that reflects the performance of obligation related tothe expected redemption of points in the future. The Company has changed to a method that recognizes the po ints
granted as performance obligations, allocates the transaction price, and records it as contract liability.
The application of the Accounting Standard for Revenue Recognition is pursuant to the transitional treatment set
forth in the proviso of Paragraph 84 of this standard. The cumulative effect of the retrospective application,
assuming the new accounting policy had been applied to periods prior to the beginning of the first quarter of thecurrent fiscal year, was added to or subtracted from retained earnings at the beginning of the first quarter of thecurrent fiscal year, and then the new accounting policy was applied beginning with this amount of retained
earnings.
As a result, compared with the previous accounting method, the application of the new standard resulted in
reductions of 1,668 million yen in sales, 88 million yen in cost of sales, 1,579 million yen in selling, general andadministrative expenses. However, there were no effects on operating profit, ordinary profit and net income
attributable to owners of the parent. In addition, the new standard reduced retained earnings at the beginning of
the current fiscal year by 114 million yen.
In accordance with the transitional treatment set forth in Paragraph 89 -2 of the Accounting Standard for Revenue
Recognition, reclassification based on the new presentation method has not been carried out for the previous
fiscal year.
Changes in valuation of inventories
The Company and certain consolidated subsidiaries previously valued its merchandise mainly at cost based on
the specific identification method (the amount shown on the balance sheet was calculated by writing down thebook value based on a decline in profitability). However, from the first quarter of the current fiscal year, the cost
method has been changed to a cost method mainly based on the weighted average method (the value on thebalance sheet is calculated by writing down the book value based on a decline in profitability).
The valuation method was changed in view of further globalization of the Group’s business and taking theopportunity of upgrade of its backbone IT system.

- 9 -Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal YearThe effect of this change is insignificant.
Accounting for leases: Application of ASC No. 842 [Leases]
Foreign subsidiaries, that have adopted the U.S. accounting standards, have started applying US GAAP ASC No.
842, Leases (ASC No. 842) standard from the first quarter of the current fiscal year. The cumulative effect of the
adoption of ASC No. 842 is recognized at the date of adoption and is an adjustment to retained earnings and leaseliabilities related to the right-of-use assets at the beginning of the first quarter of the current fiscal year.
The effect of this change on profit in the first nine months of the current fiscal year is insignificant.
Application of the Accounting Standard for Measurement of Fair Value
The Company has applied the Accounting Standard for Measurement of Fair Value, etc. (ASBJ Statement No. 30,
July 4, 2019) from the beginning of the first quarter of the current fiscal year, and has applied the new accounting
policies set forth by the Accounting Standard for Measurement of Fair Value, etc. prospectively in accordancewith the transitional treatment in Paragraph 19 of the Accounting Standard for Measur ement of Fair Value andParagraph 44-2 of the Accounting Standard for Financial Instruments (ASBJ Statement No. 10, July 4, 2019).
There is no effect of the application of these standards on the quarterly consolidated financial statements.
Segment Information
I. First nine months of FY2/22 (Mar. 1, 2021 – Nov. 30, 2021)

The Adastria Group has only a single business segment, which is the planning and sales of clothing and related
merchandise. There is no others segment because the levels of sales and earnings of other activities are
insignificant.
II. First nine months of FY2/23 (Mar. 1, 2022 – Nov. 30, 2022)

1. Information related to net sales and profit or loss for each reportable segment(Million yen)
Reportablesegment
Apparel andSundryGoods-related
Business

Other(Note 1)

Amounts shown onquarterly
consolidated
statement of income(Note 3)Adjustment(Note 2)Total

Net sales
External sales
Inter-segment sales and transfers
Total
Segment profit

169,301

7,725

177,026-

177,026

0

25

26

(26)

-

169,3027,750

177,053(26)

177,026

11,638167

11,805-

11,805

Notes: 1. “Other” represents the businesses which are not included in the reportable segment and mainly consists of Food andBeverage Business.
2. The amount of adjustment to segment profit is an adjustment to unrealized profit related to inter-segment
transactions.
3. The segment profit is consistent with the ordinary profit of the Quarterly Consolidated Statement of Income.
4. The segment profit includes corporate expenses that are allocated to each reportable segment.

2. Information related to revisions for reportable segments
In prior years, there was no segment information because the Adastria Group had only the single reportablesegment of planning and sales of clothing and related merchandise. There was no “other” segment because thisinformation was immaterial. Beginning with the first quarter of the fiscal year ending in February 2023, segment
information is presented because the importance of the food and beverage business within the Adastria Group has
increased.
Segment information for the first nine months of the previous fiscal year that was prepared by using the same- 10 -

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Yearsegment classification method used for the first nine months of the current fiscal year is not presented because
activities other than the planning and sales of clothing and related merchandise is immaterial.
In the first nine months of the previous fiscal year, the planning and sales of clothing and related material was the
only significant segment. As a result, segment information prepared by using the same segment classification
method used for the first nine months of the previous fiscal year is not presented.
3. Information related to impairment losses on non-current assets, goodwill, etc. for each reportable segment
Impairment losses related to non-current assets
Not applicable.
Significant change in goodwill
Not applicable.
Significant gain on bargain purchaseNot applicable.
Subsequent Events
Establishment of Subsidiary
The Adastria Board of Directors approved a resolution on October 19, 2022 to establish an overseas subsidiary.
1. Reason for the establishment of an overseas subsidiary
Overseas operations are an important element of the strategies for growth in the current medium -term
management plan. Southeast Asia is a key region for growth because of the large population of young people andoutlook for more expansion of the apparel market. The new company in Thailand, where there is a large volumeof spending on apparel, will use operations involving “niko and …,” a major Adastria brand, as the starting point
for activities that reflect the needs and preferences of customers in Thailand. After Adastria (Thailand)establishes a sound base of operations in Thailand, we plan to use this company to expand operations to morecountries in Southeast Asia.
2. Overview of the subsidiary(1)Company name:

Adastria (Thailand) Co., Ltd. (tentative name)(2)

Location:

Bangkok, Thailand(3)

Representative:

Hideo Kimura(4)

Business activities:

Retail business and other related activities in Southeast Asia

(5)

Capital:

100 million baht (about 390 million yen)

(6)

Establishment:

Early January 2023 (tentative)(7)

Relationships between Adastria and Adastria (Thailand):1. Capital:

Wholly owned by Adastria

2. Personnel: Two Adastria directors and Two Adastria employees are to serve
concurrently as directors of Adastria (Thailand)
3. Business: Not applicable at this time- 11 -

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

3. Supplementary Information(1) Sales for Brands and Regions
Brand / region

First nine months of FY2/23

YoY change (%)

Sales (million yen)

Composition (%)

GLOBAL WORK

33,455

18.9

21.2

niko and ...

21,93012.4

10.7

LOWRYS FARM

15,9279.0

7.1

studio CLIP

15,074

8.5

5.0

LEPSIM

9,453

5.3

7.0

JEANASiS

8,037

4.5

6.6

BAYFLOW

7,554

4.3

13.5

LAKOLE

5,682

3.2

65.3

Others25,472

14.4

14.4

Total (Adastria)

142,588

80.5

13.7

BUZZWIT Co., Ltd. (Note 3)

6,855

3.9

33.6

ELEMENT RULE Co., Ltd.

7,482

4.2

9.0

167

0.1

300.1

Other consolidated subsidiaries

157,093

88.7

14.3

Hong Kong

Total (Japan)

2,307

1.3

15.5

Mainland China

1,572

0.9

(2.3)

Taiwan

2,919

1.6

58.2

USA

5,408

3.1

53.2

12,2076.9

35.9

169,301

95.6

15.6

7,299

4.1

-

Total (Overseas)
Total (Apparel and Sundry Goods-related
Business)
Zetton, Inc. (Note 4)
ADASTRIA eat Creations Co., Ltd.

425

0.3

26.0

Total (Food and Beverage Business)

7,725

4.4

2,188.4

Total (Group)

177,026

100.0

20.6

Notes:

1. The number of stores is categorized by using brand operating divisions and geographic regions.
2. The above figures are sales to external customers and do not include internal sales between consolidated
subsidiaries.
3. Sales of BUZZWIT Co., Ltd. include sales of its consolidated subsidiary OPEN AND NATURAL, Inc.
4. Sales of Zetton, Inc. include sales of its consolidated subsidiary ZETTON, INC (USA Business).

(2) Sales for Merchandise Categories
Category

First nine months of FY2/23

YoY change (%)

Sales (million yen)

Composition (%)

Men’s apparel (bottoms, tops)

26,833

15.2

22.8

Lady’s apparel (bottoms, tops)

108,758

61.4

15.6

Others41,43423.4

34.4

Notes:

177,026
100.0
Total
1. The others category includes additions to the provision for point card certificates and other items.
2. The above figures are sales to external customers and do not include internal sales between consolidated
subsidiaries.

- 12 -

20.6

Adastria Co., Ltd. (2685) Summary of 3Q Financial Results for February 2023 Fiscal Year

(3) Number of Stores
Number of stores
Brand / region

As of Feb. 28,

First nine months of FY2/23

As of Nov.

2022

Increase
Increase
Opened Changed Closed(Note 3)/decrease30, 2022

GLOBAL WORK

206

-

3

-

(2)

1

207

niko and ...

144

-

4

-

(1)

3

147

LOWRYS FARM

136

-

2

-

(4)

(2)

134

studio CLIP

184

-

2

-

(6)

(4)

180

LEPSIM

120

-

1

-

(4)

(3)

117

JEANASiS

73

-

3

-

(2)

1

74

BAYFLOW

60

-

2

-

-

2

62

LAKOLE

47

-

18

-

-

18

65

Others

275

-

16

-

(10)

6

281

Total (Adastria)

1,245

-

51

-

(29)

22

1,267

BUZZWIT Co., Ltd. (Note 4)

18

7

6

-

(2)

11

29

ELEMENT RULE Co., Ltd.

84

-

6

-

(9)

(3)

81

Other consolidated subsidiaries

3

-

2

-

-

2

5

1,350

7

65

-

(40)

32

1,382

Hong Kong

14

-

6

-

-

6

20

Mainland China

6

-

3

-

-

3

9

Taiwan

43

-

8

-

(2)

6

49

USA

10

-

-

-

(1)

(1)

9

73

-

17

-

(3)

14

87

1,423

7

82

-

(43)

46

1,469

-

73

4

-

(5)

72

72

5

-

-

-

(2)

(2)

3

5

73

4

-

(7)

70

75

1,428

80

86

-

(50)

116

1,544

Total (Japan)
1

Total (Overseas)
Total (Apparel and Sundry
Goods-related Business)
Zetton, Inc. (Note 5)
ADASTRIA eat Creations Co., Ltd.
Total (Food and Beverage Business)
Total (Group)
Notes:

1. The number of stores is categorized by using brand operating divisions and geographic regions.
2. The number of stores includes e-commerce websites of other companies and e-commerce websites of Adastria.
3. “Increase” represents the increase in the number of stores resulting from the consolidation of Zetton, Inc. at theend of FY2/22 and OPEN AND NATURAL Inc. during the first quarter of FY2/23.
4. The number of stores of BUZZWIT Co., Ltd. includes sales of its consolidated subsidiary OPEN AND
NATURAL Inc.
5. The number of stores of Zetton, Inc. includes sales of its consolidated subsidiary ZETTON, INC (USA Business).

This financial report is solely a translation of the Company’s Kessan Tanshin (including attachments) in Japanese, which
has been prepared in accordance with accounting principles and practices generally accepted in Japan, for theconvenience of readers who prefer an English translation.

- 13 -