Summary of Financial Results for the Fiscal Year Ended August 31, 2021
[Japan GAAP] (Consolidated)
Company
Stock Code
Representative

October 12, 2021
Listed on the TSE

Watts Co., Ltd.

2735
URL: https://www.watts-jp.com/
Fumio Hiraoka, President and CEO
Hidehito Mori,
Contact
T E L: +81-6-4792-3280
Executive Managing Director, Head of Corporate Planning Office
Expected date of annual shareholders’ meeting: November 25, 2021
Expected starting date of dividend payment: November 26, 2021
Expected date of filing of annual securities report: November 25, 2021
Preparation of supplementary financial document: Yes
Results briefing: Yes (for institutional investors)（Rounded down to million yen）

1. Consolidated business results for the fiscal year ended August 2021
(September 1, 2020 through August 31, 2021)(1) Consolidated results of operations(% change from the previous corresponding period)
Sales

Operating profit

Million yen %Million yen
Year ended Aug. 2021
50,702-4.0
1,669
Year ended Aug. 2020
52,7952.7
1,768(Note) Comprehensive income:Fiscal year ended August 2021: 942 million yen (25.8%)
Fiscal year ended August 2020: 749 million yen (-%)

Recurring profit

%
-5.6
146.7

Net income
per share

Diluted net income
per share
Yen
Yen
Year ended Aug. 2021
72.09
Year ended Aug. 2020
57.80
(Reference) Investment earnings/loss on equity-method:
Fiscal year ended August 2021: -88 million yen
Fiscal year ended August 2020: -47 million yen

Million yen
1,586
1,731

Return on
equity
%
8.9
7.5

%
-8.3
163.9

Net income attributableto owners of parent
Million yen
%
965
24.7
774
997.3

Ratio of recurring
profit to total assets
%
7.4
8.0

Ratio of operating
profit to sales
%
3.3
3.4

(2) Consolidated financial position
Total assets

Shareholders’ equity
ratio

Net assets

Million yen
As of Aug. 2021
21,340
As of Aug. 2020
21,544(Reference) Shareholders’ equity:
As of August 2021: 11,222 million yen
As of August 2020: 10,481 million yen

Million yen
11,222
10,481

Net assets per
share

%
52.6
48.7

Yen
837.60782.34(3) Consolidated results of cash flows

Year ended Aug. 2021
Year ended Aug. 2020

Cash flows fromoperating activities
Million yen
378
922

Cash flows frominvesting activities
Million yen
-778
-526

Cash flows fromfinancing activities
Million yen-51
106

Cash and cash equivalents
at the end of period
Million yen
6,169
6,591

2. Dividends
Annual dividendYear ended Aug. 2020
Year ended Aug. 2021
Year ending Aug. 2022
(forecast)End of
1Q
Yen-

End of
2Q
Yen
0.00
0.00
0.00

End of3Q
Yen-

Year-end

Annual

Yen
15.00
22.00
15.00

Yen
15.00
22.00
15.00

Total
dividends(Total)Dividend
payout ratio(Consolidated)

Million yen
201
296

%
26.0
30.5
39.4

Rate of total
dividend to
net assets(Consolidated)
%
1.9
2.7

3．Forecast of consolidated business results for the fiscal year ending August 2022
(September 1, 2021 through August 31, 2022)(% change from the previous corresponding period)
Sales

For the six months
ending Feb. 2022
Year ending Aug. 2022

Operating profit

Net income
attributable to ownersof parent

Recurring profit

Net income pershare

Million yen%

Million yen%

Million yen%

Million yen%

Yen

29,350

14.6

470

-56.7

420

-60.6

215

-73.1

16.05

60,200

18.7

1,035

-38.0

955

-39.8

510

-47.2

38.07

*Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries accompanying changes inthe scope of consolidation): None
(2) Changes in accounting policies, accounting estimates and restatement①Changes in accounting policies associated with revision of accounting standards:②Changes in accounting policies other than ①③Changes in accounting estimates④Restatement: None: None: Yes: None(3) Shares outstanding (common stock)① Number of shares outstanding at the end of period (treasury stock included)
As of August 2021
13,958,800 shares
As of August 2020
13,958,800 shares② Treasury stock at the end of period:
As of August 2021
560,874 shares
As of August 2020
560,874 shares③Average number of stock during period
Fiscal year ended August 2021
13,397,926 sharesFiscal year ended August 2020
13,397,926 shares(Note) The number of treasury stock at the end of period includes the Company’s shares held by the share issuance trust for directors(FY8/21: 60,000 shares, FY8/20: 60,000 shares). In addition, the Company's shares owned by the share issuance trust for directors
are included in treasury stock deducted for calculation of the average number of shares during period (FY8/21: 60,000 shares,
FY8/20: 60,000 shares).

* Financial summary is not subject to the auditing procedures by certified public accountants or auditing firms* Explanation regarding appropriate use of business forecasts and other special instructions(Caution concerning forward-looking statements)
The forward-looking statements regarding future performance in this material are based on information currently
available to the Company and certain assumptions that the Company deems to be reasonable at the time this report was
prepared. Therefore, the Company does not make promises about the achievements. Actual results may differ
significantly from the forecasts due to various factors.
Please refer to “(4) future outlook” of “1. Results of operations” on page 4 for the suppositions that form theassumptions for business forecasts and cautions concerning the use of business forecasts.

1. Results of Operations…………………………………………………………………………………………………….. 2(1) Overview of operating results for the current fiscal year………………………………………………………….…. 2(2) Overview of financial position for the current fiscal year……………………………………………………….…… 3(3) Overview of cash flows for the current fiscal year……………………………………………………………….…... 3(4) Future outlook………………………………………………………………………………………………………… 4
2. Basic policy regarding selection of accounting standards………………………………………………………………... 4
3. Consolidated Financial Statements……………………………………………………………………………………….. 5(1) Consolidated Balance Sheets…………………………………………………………………………………………. 5(2) Consolidated Statements of Income and Statements of Comprehensive Income……..……………………………… 7(Consolidated Statements of Income)…………………………………………………………………………….. 7(Consolidated Statements of Comprehensive Income)…………………………………………………………… 8(3) Consolidated Statements of Changes in Net Assets…………………………………………………………………... 9(4) Consolidated Statements of Cash Flows……………………………………………………………………………… 11(5) Notes to Consolidated Financial Statements…………………………………………………………………………… 12(Notes on going concern assumption)………………………………………………………………………………. 12(Changes in accounting estimates)………………………………………………………………………………….. 12(Segment information)……………………………………………………………………………………………… 12(Per share information)……………………………………………………………………………………………… 12(Important subsequent events)………………………………………………………………………………………. 13
4. Other………………………………………………………………………………………………………………………. 14(1) Changes in Directors…………………………………………………………………………………………………... 14(2) Sales…………………………………………………………………………………………………………………… 14- 1 -1. Results of Operations(1) Overview of operating results for the current fiscal year
During the fiscal year ended August 2021, the impact of the outbreak of COVID-19 was evident in all aspects of daily life.
Although COVID-19 had been expanding in the wake of the fifth wave and the new variants, the Tokyo Olympic andParalympic Games 2020 ended without major incident. Still, the State of Emergency or Stricter COVID-19 Measures declared in
27 prefectures from April onward were extended several times, and the timing of the containment of COVID-19 remained
unpredictable. On the other hand, Japan’s COVID-19 vaccination rate is steadily increasing; now over 50% of the total
population in Japan has fully vaccinated. Meanwhile, although the real GDP growth rate for the April-June 2021 period wasrevised upward, the domestic economy was not strong enough to cover the decline in the preceding period.
Given this environment, in addition to the 100-Yen shop business in Japan, the Company, which operates the “Watts”, “Watts
with”, “meets.”, “silk”, etc., has been working on diversifying its revenue sources by undertaking other domestic businesses,
centering on the sale of life-style goods and discount goods as well as overseas business.
In the domestic 100-Yen shop business, the Company has been continuing to promote the introduction of products withprices higher than 100 yen (from 200 yen to 1,000 yen) and has aggressively introduced them to consignment shops. In
addition, to supplement the "fashionable taste" to the 100-Yen shop and enhance synergy between businesses, the Company
opened 4 100-Yen shops which include “Buona Vita” sections.
As for the new shop openings, the Company opened 165 shops, exceeding the full-year plan of 144 shops. There were 41 shop
closings (including 2 franchised shops), including certain unprofitable shops and unpredictable closing of shops where theCompany’s shops were located in. As a result, the total number of 100-Yen shops at the end of the current fiscal year was 1,364,
which includes 1,341 directly managed shops (net increase of 126), and 23 franchised/other shops (net decrease of 2). Of these,
the number of "Watts" and "Watts with", the Watts brand shops, increased to 825 (net increase of 186), accounting for about
60% of the total.
In the domestic other businesses, the number of shops was 21 (unchanged), as “Buona Vita,” a life-style goods shop offering
comfortable life, opened 5 shops, mainly consignment shops in its 100-Yen shops, while closing 5 unprofitable shops. Buona
Vita has focused on sales promotion through LINE official accounts and proposing stay-at-home products. “Value- 100,” thefresh-foods supermarket collaboration, continues with 1 shop (unchanged). "Real", a discount shop, was 6 shops (unchanged). In
addition, as a new business format, the Company opened the first shop of "Tokino:ne", a household items shop under the themeof “time”, in Kobe City.
Moreover, the Company withdrew from the “Søstrene Grene” business, a Denmark’s life-style variety shop, closing all the
shops in March.
Regarding the overseas operation, the Company operates “KOMONOYA”, a fixed-price shop mainly in Southeast Asia. At
the end of the current fiscal year, “KOMONOYA” operates 41 shops in Thailand (net decrease of 9), 2 shops in Malaysia(unchanged), 3 shops in Vietnam (net decrease of 2), and 19 shops in Peru (net decrease of 1). In China, a fixed price shop “小物家园”(KOMONOKAEN) was 4 shops (net decrease of 2). The total number of own-brand shops “KOMONOYA” and “小物家园”(KOMONOKAEN) was 69 (net decrease of 14).
Due to the transfer of the Chinese subsidiary in the previous fiscal year and the impact of the spread of COVID-19, sales in theoverseas business and Buona Vita declined. As well as the domestic 100-Yen shop business, sales declined largely, as its samestore sales were 95.2% year-on-year due to a reaction to the increase in demand for hygiene products and household
consumption-related products in the previous fiscal year. As a result, for the current fiscal year, sales were 50,702 million yen(down 4.0% YoY, 99.5% to the plan), operating profit was 1,669 million yen (down 5.6% YoY, 90.2% to the plan), recurring
profit was 1,586 million yen (down 8.3% YoY, 89.1% to the plan).
Net income attributable to owners of parent was 965 million yen (up 24.7% YoY, 84.0% to the plan) due to recording of gains
on debt exemption from the withdrawal of a consolidated subsidiary Hilmer Japan Co., Ltd. (*Year on year: comparison with theresults for the previous fiscal year. Ratio to plan: comparison with the business forecasts for the fiscal year ended August 2021
which were announced in the “Notice Concerning Revision to Business Forecasts” dated April 5, 2021.)
Since the Group operates under a single segment consisting of the operation of 100-Yen shops associated business, segment
information is omitted.

- 2 -(2) Overview of financial position for the current fiscal year
(Assets)
As of the end of the current fiscal year ended August 2021, current assets stood at 16,049 million yen, a decrease of 366 million
yen from the end of the previous fiscal year. This was mainly due to decreases of 422 million yen in cash and deposits and 189
million yen in notes and accounts receivable-trade, and an increase of 316 million yen in merchandise and finished goods despite.
Fixed assets stood at 5,291 million yen, an increase of 162 million yen from the end of the previous fiscal year. This was
mainly due to an increase of 384 million yen in other intangible fixed assets, due mainly to an increase in software expenses
associated with the upgrade of core systems, and a decrease of 109 million yen in investment securities and 42 million yen intools, furniture and fixtures.
As a result, total assets stood at 21,340 million yen, a decrease of 203 million yen from the end of the previous fiscal year.
(Liabilities)
As of the end of the current fiscal year, current liabilities stood at 8,620 million yen, a decrease of 1,040 million yen from theend of the previous fiscal year. This was mainly due to decreases of 540 million yen in electronically recorded obligations, 361
million yen in notes and accounts payable-trade, and 270 million yen in accrued consumption taxes.
Noncurrent liabilities stood at 1,498 million yen, an increase of 96 million yen from the end of the previous fiscal year. Thiswas mainly due to increases of 231 million yen in asset retirement obligations and 28 million yen in provision for directors'
stock-based benefits, and a decrease of 173 million yen in long-term loans payable.
As a result, total liabilities stood at 10,118 million yen, a decrease of 944 million yen from the end of the previous fiscal year.
(Net assets)
As of the end of the current fiscal year, total net assets stood at 11,222 million yen, an increase of 740 million yen from theend of the previous fiscal year. This was mainly because retained earnings increased by 763 million yen. As a result,shareholders’ equity ratio stood at 52.6% (48.7% at the end of the previous fiscal year).
(3) Overview of cash flows for the current fiscal year
Cash and cash equivalents (hereinafter referred to as “cash”) at the end of the current fiscal year amounted to 6,169 million
yen, a decrease of 422 million yen from the end of the previous fiscal year.
Details and breakdown of each cash flow in the current fiscal year are as follows.
(Cash flows from operating activities)
Net cash provided by operating activities was 378 million yen (922 million yen was provided in the previous fiscal year). Cashwas provided mainly by income before income taxes of 1,586 million yen. Cash was used mainly for decrease in trade payablesof 902 million yen and income taxes paid of 381 million yen.
(Cash flows from investing activities)
Net cash used in investing activities was 778 million yen (526 million yen was used in the previous fiscal year). This was
mainly due to purchase of intangible assets of 442 million yen associated with core system renovation and purchase of property,
plant and equipment of 319 million yen for new shop openings.
(Cash flows from financing activities)
Net cash used for financing activities was 51 million yen (106 million yen was provided in the previous fiscal year). This was
mainly due to repayments of long-term loans payable of 511 million yen and proceeds from long-term loans payable of 400
million yen.

- 3 -(4) Future outlook
Consumer spending is expected to recover steadily as the vaccination for all applicants is expected to be completed by the endof this year, and the accompanying measures to stimulate demand are expected to take effect. However, the situation is still
difficult to predict, since it is affected by the status of new variants of COVID-19 and persistence of antibody after vaccination.
Corporate activities are also expected to recover by capturing the recovery in domestic and external demand and the increase indemand for DX and green investment. On the other hand, there are negative factors such as the prolonged shortage ofsemiconductors and the persistently high resource prices, and a full-fledged recovery in corporate activities is still expected totake time.
Given this situation, the Group continues to make every effort to offer value-for-money products by investing accumulated
earnings in product development, through low-cost opening and closing of shops and low-cost shop operations. Furthermore, tomeet the diversified consumer needs, the Group will continue to aim for being the 100-Yen shop where customers can find avalue of more than ¥100.
Furthermore, with the aim of building a new revenue source to complement the 100-Yen shop business, the Group is actively
working on developing lines like “Buona Vita” and “Real”, to provide the new driving force for further growth in the future.
As for the overseas business that is expected to grow greatly in the future, the Company will strive to expand existing businessand develop new markets, in order to further expand the sales share within the Group and to earn profits.
Since the Company acquired Ontsu F･RETAIL Co., Ltd. and NIPPAN Co., Ltd., which operate a 100-Yen shop business, as
subsidiaries on October 1, 2021, it expects a substantial increase in sales for the next fiscal year.
Based on the above, the Company expects the following performance for the next fiscal year: sales of 60,200 million yen (up18.7% year on year), operating profit of 1,035 million yen (down 38.0% year on year), recurring profit of 955 million yen (down
39.8% year on year) and net income attributable to owners of parent of 510 million yen (down 47.2% year on year).
(Reference) Cash flow indicators
FY8/17

FY8/18FY8/19FY8/19FY8/21Equity ratio (%)

49.7

52.2

47.1

48.7

52.6

Market value equity ratio (%)

88.0

64.5

38.3

58.5

55.7

Interest-bearing debt to cash flows ratio (years)

1.3

1.7

0.4

1.4

3.0

284.3

157.9

522.6

197.5

30.8

Interest coverage ratio (times)(Notes) Equity ratio: Equity/Total assets
Market value equity ratio: Total market capitalization/Total assets
Interest-bearing debt to cash flows ratio: Interest-bearing debt/Operating cash flow
Interest coverage ratio: Operating cash flow/Interest payment
1. Total market capitalization is calculated by multiplying closing stock price at the end of the period by the total numberof shares issued at the end of the period (excluding treasury stock).
2. Net cash provided by operating activities in the consolidated statements of cash flows is used as ‘Operating cash flow.’
3. Interest-bearing debt includes all debt on which interest is paid reported on the consolidated balance sheet.
4. For interest payment, interest expenses paid in the consolidated statements of cash flows are used.

2. Basic policy regarding selection of accounting standards
In order to secure comparability with domestic peer companies, the Company applies Japanese accounting standards.

- 4 -3. Consolidated Financial Statements(1) Consolidated Balance Sheets(Thousands of yen)Previous fiscal year
(August 31, 2020)
AssetsCurrent assets
Cash and deposits
Notes and accounts receivable-trade
Merchandise and finished goods
Raw materials and supplies
Consumption taxes receivable
Other
Allowance for doubtful accounts
Total current assets
Noncurrent assets
Property, plant and equipment
Buildings and structures
Accumulated depreciation and impairment loss
Buildings and structures, net
VehiclesAccumulated depreciation and impairment loss
Vehicles, net
Tools, furniture and fixtures
Accumulated depreciation and impairment loss
Tools, furniture and fixtures, net
Land
Leased assets
Accumulated depreciation and impairment loss
Leased assets, net
Construction in progress
Total property, plant and equipment
Intangible assets
Other
Total intangible assets
Investments and other assets
Investment securities
Deferred tax assets
Guarantee deposits
Other
Allowance for doubtful accounts
Total investments and other assets
Total noncurrent assets
Total assets- 5 -Current fiscal year
(August 31, 2021)

6,591,348
2,340,081
7,114,726
15,33957,652
320,877-23,849
16,416,177

6,169,208
2,150,910
7,431,457
12,12375,956
232,481-22,483
16,049,656

2,021,501-1,290,640
730,860
19,860-14,252
5,607
3,637,146-3,049,711
587,435
257,800
27,623-19,879
7,744
19,162
1,608,611

2,055,446-1,313,149
742,297
26,266-20,833
5,432
3,729,454-3,184,361
545,092
257,800
27,623-26,034
1,589
1,552,212

227,932
227,932

612,229612,229

436,438
406,098
2,316,365
143,227-10,166
3,291,964
5,128,507
21,544,684

327,430
393,3902,289,987
123,665-7,574
3,126,899
5,291,340
21,340,997

Previous fiscal year
(August 31, 2020)(Thousands of yen)
Current fiscal year
(August 31, 2021)

3,479,165
3,686,438
684,324
169,097
399,90375,596
203,687
17,900945,519
9,661,633

3,118,081
3,145,453
200,000
528,247
396,644
129,894
186,679
915,676
8,620,678

569,688297,928
27,772
65,245
192,735
247,987
1,401,358
11,062,992

396,084
324,078
30,22393,938424,171229,683
1,498,180
10,118,858

440,297
1,354,136
8,965,680-273,120
10,486,994

440,297
1,354,136
9,729,641-273,120
11,250,955

15,857-21,158-5,301
10,481,692
21,544,684

9,615-38,432-28,817
11,222,138
21,340,997

Liabilities
Current liabilities
Notes and accounts payable-trade
Electronically recorded obligations
Short-term loans payable
Current portion of long-term loans payable
Income taxes payable
Accrued consumption taxes
Loss on liquidation of business
Provision for bonuses
Provision for directors' bonuses
Other
Total current liabilities
Noncurrent liabilities
Long-term loans payable
Retirement benefit liability
Provision for directors’ retirement benefits
Provision for directors' stock-based benefits
Asset retirement obligations
Other
Total noncurrent liabilities
Total liabilities
Net assets
Shareholders’ equity
Capital stock
Capital surplus
Retained earnings
Treasury stock
Total shareholders’ equity
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Total accumulated other comprehensive income
Total net assets
Total liabilities and net assets- 6 -(2) Consolidated Statements of Income and Statements of Comprehensive Income(Consolidated Statements of Income)(Thousands of yen)Previous fiscal year
(from September 1, 2019
to August 31, 2020)
Sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating revenues
Interest income
Dividends income
Foreign exchange gains
Royalty income
Compensation income
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Early-withdrawal penalty
Share of loss of entities accounted for using equity
methodExchange loss
Compensation expenses
Other
Total non-operating expenses
Recurring profit
Extraordinary income
Surrender value of insurance
Gain on sale of investment securities
Gain on sales of noncurrent assets
Insurance claim income
Gain on debt exemption
Total extraordinary income
Extraordinary loss
Loss on retirement of noncurrent assets
Impairment loss
Loss on liquidation of business
Loss on disaster
Total extraordinary losses
Income before income taxes and minority interests
Income taxes-current
Income taxes-deferred
Total income taxes
Net income
Net income attributable to owners of parent- 7 -Current fiscal year
(from September 1, 2020
to August 31, 2021)

52,795,694
32,580,148
20,215,545
18,446,842
1,768,703

50,702,569
31,076,847
19,625,721
17,956,171
1,669,549

6,512
915
5,405
26,92235,542
18,73094,028

1,602
998
14,907
3,741
5,239
2,465
9,405
38,3606,723
52,37147,5404,926
1,320
88,514

17,485
7,465
131,585
1,731,147

20,0406,454
121,256
1,586,653

1,260
362
25,13826,761

5,821
6,866
231
8,532
291,302
312,755

4,879
205,031426,904
24,791
661,605
1,096,302
361,974-40,050
321,924
774,378
774,378

7,131
305,506
312,638
1,586,770
608,760
12,179620,940
965,830
965,830

(Consolidated Statements of Comprehensive Income)(Thousands of yen)Previous fiscal year
(from September 1, 2019
to August 31, 2020)
Net income
Other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Share of other comprehensive income ofassociates accounted for using equity method
Total other comprehensive income
Comprehensive income(Breakdown)Comprehensive income attributable to owners ofparent- 8 -Current fiscal year
(from September 1, 2020
to August 31, 2021)

774,378965,830

10,445-6,242-33,588-13,803-2,012-3,469-25,156
749,221-23,515
942,314749,221942,314(3) Consolidated Statements of Changes in Net Assets
Previous fiscal year (from September 1, 2019 to August 31, 2020)(Thousands of yen)
Shareholders’ equity
Capital stock
Balance at the beginning ofcurrent period

Capital surplus

440,297

Retained earnings

1,637,636

8,325,881

Total shareholders’equityTreasury stock-273,120

10,130,694

Changes of items during theperiodDividends from surplus-134,579-134,579

Net income attributableto owners of parent

774,378

774,378

Increase (decrease) in
equity due to acquisitionof consolidated
subsidiaries
Net changes of items
other than shareholders'equity-283,500-283,500

Total changes of items during
the period--283,500

639,799-356,299

Balance at the end of current
period440,297

1,354,136

8,965,680-273,120

10,486,994

Accumulated other comprehensive income

Balance at the beginning ofcurrent period

Valuation difference
on available-for-salesecurities

Foreign currencytranslation adjustment

Total accumulated
other comprehensive
income5,411

14,443

19,855

Non-controllinginterests

Total net assets-283,500

9,867,050

Changes of items during theperiodDividends from surplus-134,579

Net income attributableto owners of parent

774,378

Increase (decrease) in
equity due to acquisitionof consolidated
subsidiaries
Net changes of items
other than shareholders'equityTotal changes of items during
the period
Balance at the end of current
period-283,500

10,445-35,601-25,156

283,500

258,343

10,445-35,601-25,156

283,500

614,642

15,857-21,158-5,301-

10,481,692- 9 -Current fiscal year (from September 1, 2020 to August 31, 2021)(Thousands of yen)
Shareholders’ equity
Capital stock
Balance at the beginning ofcurrent period

Capital surplus

440,297

Retained earnings

1,354,136

8,965,680

Total shareholders’equityTreasury stock-273,120

10,486,994

Changes of items during theperiodDividends from surplus-201,868-201,868

Net income attributableto owners of parent

965,830

965,830

Net changes of items
other than shareholders'equityTotal changes of items during
the period--

763,961-

763,961

Balance at the end of current
period440,297

1,354,136

9,729,641-273,120

11,250,955

Accumulated other comprehensive income

Balance at the beginning ofcurrent period

Valuation difference
on available-for-salesecurities

Foreign currencytranslation adjustment

Total accumulated
other comprehensive
income15,857-21,158-5,301

Total net assets

10,481,692

Changes of items during theperiodDividends from surplus-201,868

Net income attributableto owners of parent

965,830

Net changes of items
other than shareholders'equity-6,242-17,273-23,515-23,515

Total changes of items during
the period-6,242-17,273-23,515

740,445

Balance at the end of current
period9,615-38,432-28,817

11,222,138- 10 -

(4) Consolidated Statements of Cash Flows(Thousands of yen)Previous fiscal year
(from September 1, 2019
to August 31, 2020)
Net cash provided by (used in) operating activities
Income before income taxes and minority interests
Depreciation and amortization
Impairment loss
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for directors' bonuses
Increase (decrease) in liabilities relating toretirement benefits
Increase (decrease) in provision for directors’
retirement benefits
Increase (decrease) in provision for directors'
stock-based benefits
Increase (decrease) in provision for loss on
business liquidation
Interest and dividends income
Interest expenses
Loss (gain) on sale of investment securities
Loss on retirement of noncurrent assets
Loss on liquidation of business
Gain on debt exemption
Decrease (increase) in accounts receivable-trade
Decrease (increase) in inventories
Increase (decrease) in notes and accounts payable-trade
Increase (decrease) in accrued consumption taxes
Other
SubtotalInterest and dividends income received
Interest expenses paid
Income taxes paid
Net cash provided by (used in) operating activities
Net cash provided by (used in) investing activities
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of intangible assets
Payments for asset retirement obligations
Payments for lease and guarantee deposits
Proceeds from collection of lease and guarantee
deposits
Purchase of investment securities
Proceeds from sale of investment securities
Payments for sales of shares of subsidiaries resulting
in change in scope of consolidation
Other
Net cash provided by (used in) investing activities
Net cash provided by (used in) financing activities
Net increase (decrease) in short-term loans payable
Proceeds from long-term loans payable
Repayment of long-term loans payable
Repayment of lease obligations
Cash dividends paid
Other
Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period- 11 -

Current fiscal year
(from September 1, 2020
to August 31, 2021)

1,096,302
413,311205,031
5,721-1,823
16,464
17,9001,586,770
375,722305,506
5,721-3,958-17,007-17,900

21,147

26,149

3,037

2,451

32,523

28,69343,433-75,596-7,428
6,723
4,879
310,918
109,883-156,182-1,112,894
325,759
19,3881,354,095
6,999-4,669-434,325
922,099-2,6004,926-6,866
7,131-291,302
188,585-327,397-902,068-290,251
172,169
768,877
3,567-12,298-381,885
378,261-431,272
342-110,535-59,605-73,186-319,611
1,660-442,354-68,332-81,771

157,373

67,209-387-

16,183-9,620-600-526,290

48,043-778,973

838,342-591,547-6,286-134,413
106,094

200,000
400,000-511,510-6,286-201,671
67,500-51,968

14,12930,540516,032
6,075,315
6,591,348-422,139
6,591,348
6,169,208

(5) Notes to Consolidated Financial Statements(Notes on going concern assumption)
None(Changes in accounting estimates)
Asset retirement obligations
In the second quarter of the fiscal year ended August 2021, the Company changed its estimate for asset retirement obligations
that had been recorded as restoration obligations associated with real estate lease contracts, since it acquired new informationsuch as the most recent actual restoration costs. An increase of 220,100 thousand yen due to this change has been added to thebalance of asset retirement obligations before the change.
Some of the tangible fixed assets in connection with this change were recorded as impairment losses. As a result of thischange in estimate, income before income taxes and minority interests for the current fiscal year decreased by 87,045
thousand yen.
(Segment information)
Since the Group has a single segment consisting of the operation of 100-Yen shops and associated business, thisinformation is omitted.
(Per share information)
Previous fiscal year
(from September 1, 2019

Current fiscal year
(from September 1, 2020

to August 31, 2020)

to August 31, 2021)

Net assets per share

782.34 yen

837.60 yen

Net income per share

57.80 yen

72.09 yen

(Notes) 1. No diluted net income per share is presented because dilutive shares do not exist.
2. The Company's shares owned by the share issuance trust for directors are included in the treasury stock deducted in thecalculation of the total number of shares outstanding at the end of period, which is the basis for calculating net assets per
share. (previous fiscal year: 60,000 shares, current fiscal year: 60,000 shares).
3. The Company's shares owned by the share issuance trust for directors are included in the treasury stock deducted in thecalculation of the average number of shares during period, which is the basis for calculating net income per share.
(previous fiscal year: 60,000 shares, current fiscal year: 60,000 shares).
4. The basis for calculating net income per share is as follows.
Previous fiscal year
(from September 1, 2019
to August 31, 2020)
Net income attributable to owners of parent (thousand yen)Amount that does not belong to common shareholders(thousand yen)
Net income attributable to owners of parent available tocommon shareholders (thousand yen)
Average number of common shares during the period(shares)- 12 -

Current fiscal year
(from September 1, 2020
to August 31, 2021)

774,378965,830--

774,378965,830

13,397,926

13,397,926

(Important subsequent events)(Business combination through acquisition)
At a meeting of the Board of Directors held on August 27, 2021, the Company resolved to acquire all the shares of Ontsu
F.RETAIL Co., Ltd. and NIPPAN Co., Ltd. to make them subsidiaries, and concluded its share transfer agreement. On October
1, 2021, the Company acquired all the shares of these companies.
(1)The outline of the business combination① Name of the acquired company and the contents of its business
Name of theacquired company

Ontsu F.RETAIL Co., Ltd.

NIPPAN Co., Ltd.

Outline of business

Operation of 100-Yen shops, "FLET'S"and "Hyakuen Ryojikan", etc., as well as
operation of franchised chain shops.

Planning, import, and sales of generalmerchandise products for 100-Yen shops② Major reasons for the business combination
Ontsu F.RETAIL Co., Ltd. operates approximately 140 100-Yen shops under the brand names of "FLET'S" and"Hyakuen Ryojikan", mainly in the Kansai and Kanto regions. NIPPAN Co., Ltd. wholesales merchandise to 100-Yen
shops. The Company has decided to acquire all shares of these companies and made them subsidiaries, as it believes that
it will improve the corporate value by expanding the store network and business scale of the core 100-Yen shop business.
③ Date of business combination
October 1, 2021
④ Legal form of business combination
Acquisition of shares⑤ Name of the company after the merger
No change⑥ Percentage of voting rights acquired
100%⑦ Grounds for determining the acquiring company
The Company’s cash acquisition of shares(2) Acquisition cost of the acquired company and breakdown by type of consideration
Consideration for acquisition
Acquisition cost

Cash

2 yen
2 yen

(3) Details and amount of major acquisition-related expenses
Due diligence expenses, etc.: 1,000 thousand yen(4) Amount of goodwill incurred, reason for the goodwill, amortization method and period
Not determined at this time.
(5) Amount of assets received and liabilities assumed on the date of business combination and its major breakdown
Not determined at this time.

- 13 -

4. Other(1) Changes in directors① Change in the representative director
None② Changes in other directors
None(2) Sales
Sales by area and business type are as follows.
Area

Amount(thousand yen)

Year-on-yearchange (%)

Number of shops
As of August 31,
2021

Newly opened

ClosedHokkaido area

2,169,917

100.9

93

19

4

Tohoku area

2,146,117

101.9

81

8

3

Kanto area

12,534,899

93.8

306

31

8

Chubu area

7,206,732

98.6

219

19

5

Kinki area

10,459,255

96.3

244

29

10

Chugoku/Shikoku area

5,034,968

103.4

234

48

4

Kyushu area

4,736,435

98.5

164

11

5

100-Yen shop business

44,288,328

97.4

1,341

165

39

Wholesale

6,414,241

87.5

121

8

27

Total

50,702,569

96.0

1,462

173

66

- 14 -