～No Change, No Full Recovery～

Presentation of Results for First Six Months of
Fiscal Year Ending February 28, 2022

October 12, 2021
YOSHIMOTO Tatsuya
President and Representative Executive Officer
J. Front Retailing Co., Ltd.

Create and Bring to Life “New Happiness.”Today’s Agenda

III. Overview of H1 FY2021 Results

III. H2/Full FY2020 Forecast
III. Progress of Medium-term Business Plan

1

Overview of H1 FY2021 Results (IFRS)

2Consolidated PL (IFRS)
Prolonged impact of COVID-19 such as local and national government’s requests to close
stores, shorten business hours and restrict admission

Achieved business profit; business profit above, operating loss and loss below June forecast
Paid interim dividend of ¥14 per share, up ¥5 YoY, as planned at beginning of year
(Millions of yen, unless otherwise stated)

First six months offiscal year ending
February 28, 2022

Q1

Q2

H1
Results

YoY %

2.3)

402,148)

25.4)

vs. June
forecast(12,852)

83,236(0.9)

157,333)

6.7)(7,667)

57.6)

36,158(5.3)

69,693)17.2)(2,307)32,236)28.2)

33,802(0.7)

66,038)11.6)(2,462)Business profit (loss)

1,298)－

2,356(43.0)

3,654)－

154)

Other operating income

431)(46.1)

1,225(57.6)

1,657)(55.1)

657)

Other operating expenses

5,550)(76.9)

1,150

107.2)

6,701)(72.7)(299)

Operating profit (loss)(3,819)－2,430(62.4)(1,388)－

1,112)

Profit (loss) attributable toowners of parent(3,062)－

1,067(73.5)(1,995)－

1,005)

ResultsYoY %Results

Gross sales

190,665)67.3)

211,483

Revenue

74,097)16.8)

Gross profit

33,535)

SGA

Dividend per share (Yen)YoY %(Interim)

14)(YoY ¥) 5)

3

Segment Performance (1) Department Store (IFRS)
Slower recovery than expected in Q2 due to 5th wave of COVID-19
Business loss above forecast partly due to decreased profit margin in spite of efforts to further
reduce SGA
Operating loss below forecast due to increase in other operating income including subsidies for
employment adjustment associated with store closure
Revenue
100,000
80,0000△500△1,000△1,500△2,000△2,500△3,000△3,50086,33874,23960,00040,00020,0000

1H
H1 FY2020
FY2020Results

Operating profit (loss)

Business profit (loss)
0△5,000(1,447)△15,000△20,000△25,000(2,982)H1 FY2020
1H
Results
FY20201H
H1 FY2021
FY2021Results(4,757)△10,000(20,318)
H1 FY2020
1H
Results
FY2020H1 FY2021
1H
Results
FY2021H1 1H
FY2021Results
FY2021(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Q1

Q2

H1

Gross sales

114,723)80.4

132,880)

2.0)

247,604)

27.7

vs. June
forecast－

Revenue

39,631)54.0

46,706)(3.7)

86,338)

16.3

－

SGA

25,433)42.0

28,589)5.0)

54,002)

19.7－

Business profit (loss)

(872)

－

(575)

－

(1,447)－(347)

Operating profit (loss)(3,922)

－

(835)

－

(4,757)－

243)

ResultsYoY %ResultsYoY %Results

YoY %4

Daimaru Matsuzakaya Department Stores Major Store Sales
Sales improved more than 10 points from Q1 to Q2 compared to FY2019 but recovery slowed
down
Kobe and Nagoya stores that have strong regular customers such as gaisho customers
recovered steadily
Tokyo and Umeda stores that heavily depend on railway passengers remained relatively
sluggish(%)

Fiscal year ending
February 28, 2022

vs. FY2020

vs. FY2019

Q1
Results

Q2
Results

H1
Results

Q1
Results

Q2
Results

H1
Results

Shinsaibashi

116.2

29.7)

55.6

(57.8)(38.6)(48.4)

Umeda

58.6

(5.1)

12.1

(56.7)(31.9)(44.1)

Tokyo

94.0

4.9)

33.2

(53.5)(45.6)(49.6)

Kyoto

64.7

1.1)

22.9

(32.1)(23.4)(27.6)

Kobe

98.1

(0.3)

28.6

(25.7)(8.8)(17.3)

Sapporo

103.8

(6.8)

27.8

(31.5)(30.9)(31.2)

Nagoya

94.8

5.6)

34.9

(19.2)(13.1)(16.1)

Total
directly managed stores

84.9

2.6)

28.8

(37.8)(26.4)(32.1)*Total is on a comparable store basis (Comparison with FY2019 excludes Yamashina store and Shimonoseki store).

5Daimaru Matsuzakaya Department Stores SGA Analysis (IFRS)H1 FY2021
SGA analysis(Millions of yen)

Decrease indepreciation

Decrease inother SGA

(5,018)

Increase inpersonnel
expenses

Increase inpacking andtransportation
costs

1,156

598
Increase in
ad expenses

40,703

23

Increase indepreciation

1,766
(6)

Decrease inrent expenses

3,174

(633)

(204)

(261)

Decrease inrent expenses

Decrease inpersonnel
expenses(1,503)(799)
Decrease in
ad expenses

919

Increase inoperationalcosts【Fixed costs reclassified due to store closure】(TY) ¥2.29 billon
Personnel expenses ¥0.35 billion,
depreciation ¥0.99 billion,
other (outsourcing expenses, etc.) ¥0.93 billion, etc.
(LY) ¥6.69 billion
Personnel expenses ¥1.21 billion,
depreciation ¥2.52 billion,
other (outsourcing expenses, etc.) ¥2.92 billion,etc.

58,913

48,332

Down ¥10,581 million from FY 2019Up ¥7,629 million YoY
LY
Results(2,161)
Decrease inoperational
costs

Increase inother SGA

Decrease inpacking andtransportation
costs

H1 TY
Results

H1 FY2019
Results
6

Segment Performance (2) SC Business (IFRS)
Affected by closure and reduced business hours due to declaration of state of emergency
and priority preventative measures
Achieved both business profit and operating profit through efforts to reduce cost and SGA
Entertainment struggled due to continued restrictions, Neuve A was excluded fromconsolidation at end of June by share transfer
Revenue
30,00025,00020,00015,00010,0005,000
026,764

3,000
2,500
2,000
1,500
1,000
500
0

23,1661H
H1 FY2020
Results
FY2020Operating profit (loss)

Business profit

1H
H1 FY2021
H1
Results
FY2021
FY2021

2,721

456

1,000
0
△1,000△2,000950△3,000△4,000H1 FY2020
1H
Results
FY2020(3,071)H1 1H
FY2020
FY2020Results

H1 FY2021
1H
Results
FY2021H1 1H
FY2021
FY2021Results(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Q1

Q2

H1

Gross sales

50,440)94.1

52,5391.0)

102,979

32.1)

vs. June
forecast－

Revenue

13,786)59.2

12,978(10.5)

26,764

15.5)

－

SGA

3,081)

6.7

2,237(41.4)

5,318(20.7)－

Business profit

1,486)

－

1,235

46.8)

2,721

186.4)(179)

Operating profit

(955)

－

1,411

20.5)

456

－

56

ResultsYoY %ResultsYoY %Results

YoY %7

Segment Performance (3) Developer Business (IFRS)
Existing real estate rental properties including use of transferred properties performed steadily
as expected
Increase in orders received by J. Front Design & Construction for large scale projects in Tokyoand Kyushu areas also contributed
Revenue below June forecast is mainly attributable to delay in planned sale of real estate
properties
Revenue
35,00030,00025,00020,00015,00010,0005,000
0Business profit

32,8902,000
25,737

1,731

Operating profit
2,000

1,726

1,500

1,500

1,000

1,000

500

500

0
H1 FY2020
1H
Results
FY2020H1 FY2021
1H
Results
FY2021

1,698

1,807

H1 FY2020
1H
Results
FY2020H1 1H
FY2021Results
FY20210
H1 FY2020
1H
Results
FY2020H1 FY2021
1H
Results
FY2021(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Q1

Q2

H1

Gross sales

14,8740.4)

14,14312.7

29,017

6.0)

vs. June
forecast－

Revenue

11,640(46.2)

14,09625.3

25,737(21.7)

－

SGA

1,605

6.2)

1,696

17.9

3,302

11.9)

－

Business profit818(20.3)

907

28.8

1,726

(0.3)

326)

Operating profit

876

11.7)

931

2.0

1,807

6.5)

(293)

ResultsYoY %ResultsYoY %Results

YoY %8

Segment Performance (4) Payment and Finance Business (IFRS)Steadily recovered in spite of slow recovery of transaction volume affected by temporary
closure of department stores, etc.
Both business profit and operating profit above June forecast partly due to reduction of SGA
Transaction volume per account is increasing partly due to renewal of credit cards
Revenue
6,000
5,000
4,000
3,000
2,000
1,000
0

Business profit
446

500

4,953

4,593

Operating profit

476

600
500
400
300
200
100
0

400
300
200
100

0
H1 FY2020
1H
Results
FY2020H1 1H
FY2021Results
FY2021

H1
FY20212021年度Results
上期実績

2020年度H1
FY2020
上期実績
Results

506

453

H1 FY2020
1H
Results

H1 1H
FY2021Results

FY2020

FY2021(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Q1

Q2

H1

Gross profit

3,398

44.9)

3,434

19.8

6,832

31.1

vs. June
forecast)－

Revenue

2,335

11.4)

2,617

4.8

4,953

7.8

)－

SGA

2,267

15.5)

2,209

1.1

4,476

7.9

－

Business profit

68(48.5)

408

30.1

476

6.8

276

Operating profit

75

4.0)

431

13.2

506

11.7

306

ResultsYoY %ResultsYoY %Results

YoY %9

Segment Performance (5) Other (IFRS)Revenue increased driven by Daimaru Kogyo whose sales of automotive parts were strong andDimples’ on which impact of COVID-19 was improved
Comparison to June forecast of Daimaru Kogyo was affected by more prolonged impact of
COVID-19 than expected
Business profit above forecast due to reduction of SGA, operating profit above forecast partly
due to subsidies for employment adjustment
Revenue
40,000Business profit
1,200
1,000
800
600
400
200
0

34,67331,571

30,00020,00010,0000

1H
H1 FY2020
Results
FY2020

700
600
500
400
300
200
100
0

964
596

H1 FY2020
1H
Results
FY2020H1 1H
FY2021Results
FY2021

Operating profit
631
412

H1 1H
FY2020Results
FY20201H
H1 FY2021
Results
FY20211H
H1 FY2021
Results
FY2021(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Q1

Q2

H1

Gross sales

19,5008.5)

20,428

3.3)

39,9295.8)

vs. June
forecast－

Revenue

17,31914.9)17,354

5.2)

34,673

9.8)

－

SGA

5,460

6.3)

5,636

8.9)

11,096

7.6)－

Business profit316(14.3)

279(53.0)

596(38.1)

196)

Operating profit

135

－

495

(50.2)

631

53.0)

231)

ResultsYoY %ResultsYoY %Results

YoY %10

Consolidated BS (IFRS)
Total assets decreased ¥30.6 billion compared to previous year end partly due to depreciationand sale of Neuve A
Interest-bearing liabilities decreased ¥8.6 billion compared to previous year end due torepayment of lease liabilities
Ratio of equity attributable to owners of parent was 28.0%, up 0.1 points from previous year end

Total assets

Interest-bearing liabilities

Equity attributable toowners of parent
Ratio of equity
attributable toowners of parent

1,263,722
1,233,119(30,603)562,815
Leaseliabilities
202,885～ ～Feb 28, 2021

(Millions of yen)

Aug 31, 2021

28.0

27.9%
＋0.1 points

554,189(8,626)

Lease
liabilities
192,532

352,171

345,842(6,329)Bonds/
borrowings
359,930

Bonds/
borrowings
361,657

Feb 28, 2021

Aug 31, 2021

Feb 28, 2021

Aug 31, 202111

Consolidated CF (IFRS)
Operating CF decreased ¥2.4 billion due to increase in working capital as well as decrease inoperating loss
Free CF was ¥12.3 billion, up ¥3.9 billion YoY partly due to reduction of investment
Net cash provided by financing activities decreased ¥99.3 billion YoY in reaction to financing for
COVID-19 last year

Operating CF

Investing CF

Free CF

Financing CF

Balance of
cash and deposits
124,377
123,450

81,35519,758 17,261<＋6,491><(2,497)>(11,358)(4,867)8,400 12,393<(927)><＋3,993>(17,962)<(99,317)>

Figures in angle brackets represent YoY changes.

Results Q2 FY ended February 28, 2021
(Millions of yen)

Results Q2 FY ending February 28, 2022

12

H2/Full FY2021 Forecast (IFRS)

13

Business Environment Awareness◆ Assume that restrictions on travel and request to shorten
business hours will be eased gradually◆ Assume that restriction on entry of inbound tourists toJapan will not be eased in current fiscal year
◆ However, consider measures with “multiple scenarios”
in preparation for worsening situation

14

Consolidated PL Forecast (IFRS)Forecasts for all profit items remain unchanged from June forecast due to flexible costmanagement in spite of uncertainty about sales
For Department Store, domestic consumption is expected to recover faster from late Q3 to Q4
Plan to pay year-end dividend of ¥15 per share, resulting in annual dividend of ¥29, up ¥2 YoY(Millions of yen, unless otherwise stated)

H2
Fiscal year ending
February 28, 2022

Forecast

Full year
YoY %Forecast

YoY %vs. June
forecast

Gross sales

519,851

15.8)

922,000

19.8)(13,000)

Revenue

200,166

16.6)

357,500

12.0)(7,500)Gross profit

82,806

10.5)

152,500

13.5)(2,500)SGA

74,461

2.3)

140,500

6.4)(2,500)Business profit (loss)

8,345

294.3)

12,000407.2)

0)

Other operating income

5,342

164.5)

7,000

22.6)

0)

Other operating expenses

6,798(12.4)

13,500(58.3)

0)

Operating profit (loss)

6,888

－

5,500

－

0)

Profit (loss) attributable toowners of parent

2,995

－

1,000

－

0)

29 (YoY ¥) 2)

0)

Dividend per share (Yen)(Year-end)

15(YoY ¥) (3) (Annual)15

Segment Performance Forecast (1) Department Store Business
Sales are expected to recover from late Q3 to Q4 in spite of impact of declaration of state of
emergency in September
Inbound sales are expected not to attain full-scale recovery but to remain at H1 level this year
Revenue
250,000

201,600
200,000

173,831150,000
100,000
50,0000
2020年度FY2020実績
Results

Operating profit (loss)

Business profit (loss)
4,000
3,000
2,000
1,000
0
△1,000△2,000△3,000△4,0002021年度FY2021見通し
Forecast

3,000

0(1,200)△5,000△10,000△15,000△20,000(2,936)△25,000

2020年度FY2020実績
Results(20,785)
2020年度FY2020実績
Results

2021年度FY2021見通し
Forecast

2021年度FY2021見通し
Forecast(Millions of yen, %)H2Fiscal year ending
February 28, 2022 Forecast
YoY %Full year
Forecast

YoY %vs. June
forecast

Gross sales

331,49917.1

579,200)

21.4－

Revenue
SGA

115,11562,530
4,507
3,366

15.8
5.8
－
－

201,600)
116,600)
3,000)(1,200)

16.0
12.0
－
－

－
－
(300)
300)

Business profit (loss)
Operating profit (loss)

16

Daimaru Matsuzakaya Department Stores Major Store Sales Forecast(%)

Fiscal year ending
February 28, 2022

vs. FY2020

vs. FY2019

Q3
Forecast

Q4
Forecast

H2
Forecast

Q3
Forecast

Q4
Forecast

H2
Forecast

Shinsaibashi

28.7)

33.8

31.3

(21.5)(4.0)(13.1)

Umeda

7.9)

40.8

25.6

(26.0)(5.5)(14.9)

Tokyo

11.7)

43.3

27.9

(31.9)(14.8)(23.0)

Kyoto

6.7)

27.8

17.9

(13.9)

5.8)

(3.6)

Kobe

(1.7)

17.8

8.5

(9.3)

9.8)

0.6)

Sapporo

18.0)

34.4

26.8

(12.3)

(3.5)

(7.5)

Nagoya

5.0)

23.0

14.5

(12.7)

9.6)

(1.3)

Total
directly managed stores

8.5)

26.4

18.0

(17.7)

0.2)

(8.4)

*Total is on a comparable store basis (Comparison with FY2019 excludes Shimonoseki store and Toyota store).

17

Daimaru Matsuzakaya Department Stores SGA Analysis (IFRS)H2 FY2021
SGA analysis(Millions of yen)Other

(5,021)

Personnel
expenses

4,354

Packing andtransportation
costs

88

144
Ad
expenses

Other

94

Rent
expenses

Depreciation(234)

Operationalcosts

Depreciation

89

577

564 (1,508)

Packing andtransportation
Personnel
costs(1,031) expenses

(59)
Rent
expenses(77)
Ad
expenses

6,339

Operational
costs

・Mainly decrease due to merger of Daimaru
Matsuzakaya Sales Associates on
September 1, 2021 (¥3.4 billion)

56,667・Increase in reaction to decrease of ¥4.1 billion
in retirement benefit costs resulting fromextension of retirement age in FY 2019
・Mainly increase due to merger of Daimaru
Matsuzakaya Sales Associates on
September 1, 2021 (¥3.2 billion)

56,172

52,841・Mainly increase due to merger of Daimaru Matsuzakaya
Sales Associates on September 1, 2021 (¥3.2 billion)

Up ¥4.95 million from 2019Up ¥3,826 million YoY
H2 LY
Results

H2 TY
Forecast

H2 FY2019
Results
18

Segment Performance Forecast (2) SC Business (IFRS)Revenue decreased in H2 affected by exclusion of Neuve A from consolidation in spite of fullcontribution of Shinsaibashi PARCO
Both business profit and operating profit significantly increased in H2 in reaction to rent
concessions last year and due to reduction of SGA
Revenue
60,00055,23155,00050,00040,00030,00020,00010,0000
2020年度FY2020実績
Results

Operating profit (loss)

Business profit
4,500
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0

2021年度FY2021見通し
Forecast

4,200

4,000

1,800

2,000
0
△2,000△4,0001,079△6,000△8,0002020年度FY2020実績
Results

2021年度FY2021見通し
Forecast(6,896)2020年度FY2020実績
Results

2021年度FY2021見通し
Forecast(Millions of yen, %)Fiscal year ending
February 28, 2022

H2
Forecast

Full year
YoY %Forecast

YoY %vs. June
forecast

Gross sales

128,5209.0)

231,500

18.2)－

Revenue
SGA

28,235
4,681
1,478
1,343

(12.5)(39.7)－－

55,00010,000
4,200
1,800

(0.8)
(30.9)
316.7)
－

－
－
(200)
0)

Business profit
Operating profit

19

Segment Performance Forecast (3) Developer Business (IFRS)Real estate rental business including development of new properties is expected to steadily
contribute to revenue
Revenue and profit are expected to increase in H2 partly due to strengthening of properties inmajor cities in design and construction businessBusiness profit

Revenue
60,00056,50053,82550,00040,00030,00020,00010,0000
2020年度FY2020Results
実績

4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0

2021年度FY2021
Forecast
見通し

Operating profit
4,000
3,500
3,000
2,500
2,000
1,500
1,000
500
0

3,400
2,840

2020年度FY2020Results
実績

2021年度FY2021見通し
Forecast

3,500

1,981

2020年度FY2020実績
Results

2021年度FY2021見通し
Forecast(Millions of yen, %)Fiscal year ending
February 28, 2022

H2
Forecast

Full year
YoY %Forecast

YoY %vs. June
forecast

Gross sales

31,88236.2

60,90019.9－

Revenue
SGA

30,762
3,497
1,673
1,692

46.9
19.7
50.9
496.0

56,500
6,800
3,400
3,500

5.0
15.8
19.7
76.6

－
－
300)
(300)

Business profit
Operating profit

20

Segment Performance Forecast (4) Payment and Finance Business (IFRS)Strengthen efforts to acquire new customers by developing new customers in department storesand promoting online sign-up
Expected to return to business profit and operating profit in H2 partly due to increase intransaction volume through campaign
Revenue
12,00010,00010,800

1400

8,000
6,000

1000

800

800

0

600

396

400

2,000

421

400

200

200

0

0

2021年度FY2021
Forecast
見通し

1,200

1200

1000
600

4,000

1400

1,140

1200

9,035

2020年度FY2020Results
実績

Operating profit

Business profit

FY20202020年度Results
実績

FY20212021年度Forecast
見通し

2020年度FY2020Results
実績

2021年度FY2021
Forecast
見通し(Millions of yen, %)Fiscal year ending
February 28, 2022

H2
Forecast

Full year
YoY %Forecast

YoY %vs. June
forecast

Gross sales

7,667

22.0

14,50026.1－

Revenue
SGA

5,846
5,183
663
693

31.6
15.4
－
－

10,800
9,660
1,140
1,200

19.5
11.8
187.3
184.9

－
－
240
300

Business profit
Operating profit

21

Segment Performance Forecast (5) Other (IFRS)In Other segment, revenue and profit of its core company Daimaru Kogyo are expected todecrease in H2
Also affected by exclusion of a subsidiary J. Front Foods from consolidation on February 26
this year
Revenue
70,00062,559Business profit
64,00060,00050,00040,00030,00020,00010,0000
FY20202020年度Results
実績

FY20212021年度Forecast
見通し

Operating profit

1,654

1,800
1,600
1,400
1,200
1,000
800
600
400
200
0

2,000

1,724

1,500

1,200

1,100
1,000
500
0
2020年度FY2020Results
実績

2021年度FY2021
Forecast
見通し

2020年度FY2020実績
Results

2021年度FY2021見通し
Forecast(Millions of yen, %)Fiscal year ending
February 28, 2022

H2
Forecast

Full year
YoY %Forecast

YoY %vs. June
forecast

Gross sales

38,285(4.6)

75,000(0.8)－

RevenueSGA

32,542
11,283
707
660

(2.1)
(0.9)
(39.5)(46.7)

64,00022,200
1,200
1,100

2.3)
3.0)
(27.5)(36.2)

－
－
200)
200)

Business profit
Operating profit

22Consolidated BS Forecast (IFRS)
Total assets are expected to decrease ¥63.7 billion YoY partly due to decrease in fixed assets
Interest-bearing liabilities are expected to decrease ¥20.8 billion YoY partly due torepayment of lease liabilities
Ratio of equity attributable to owners of parent is expected to be 28.8%, up 0.9 points YoY

Total assets

Interest-bearing liabilities

1,263,722

Equity attributable toowners of parent
Ratio of equity
attributable toowners of parent

1,200,000(63,722)

28.8

27.9
562,815
Leaseliabilities
202,885～ ～Feb 28, 2021
(Millions of yen)

Feb 28, 2022

＋0.9 points

542,000(20,815)

Leaseliabilities
185,000

352,171

345,000(7,171)

Bonds/
borrowings
359,930

Bonds/
borrowings
357,000

Feb 28, 2021

Feb 28, 2022

Feb 28, 2021

Feb 28, 202223

Consolidated CF Forecast (IFRS)
Operating CF is expected to decrease ¥16.4 billion YoY partly due to increase in working
capital resulting from business scale recovery
Secure free CF of ¥33.0 billion partly due to reduction of investment and revenue from sale ofassetsContinue to secure enough cash reserves until COVID-19 comes to an end

Operating CF

Investing CF

Free CF

Financial CF

Balance of
cash and deposits
128,925
120,000

58,72756,47140,00035,601 33,000<＋13,870><(16,471)><(2,601)>(20,870)(7,000)Figures in angle brackets represent YoY changes.

Results FY ended February 28, 2021
(Millions of yen)<(8,925)>(41,000)<(99,727)>

Forecast FY ending February 28, 2022

24

FY2021 - FY2023

Progress of Medium-term Business Plan

25

Overall Structure of Medium-term Business Plan
3 strategies for revenue recovery and regrowth

Real × Digital Strategy

Prime Life Strategy－Department Store: Enhanceappeal of stores and use
stores for media commercewith focus on genuineness/essence－Develop new solution
services to realize highquality customer experience－Parco: Rebuild store brandvalue / seek digital SC
platform－Create/develop new content
from CSV perspective

Developer Strategy－Mixed use not limited tocommercial use－Launch circular investment
scheme－ Advance online gaisho
communication－ Enter into semi-urban areas－ Advance CRM strategy at
the Group level

Important measures for full recovery

The Group structure reform－ Reduce costs via business model reform－ Narrow business base26

Image of Portfolio Transformation
Expand share of Developer, Payment and Finance, Other
while steadily growing Department Store, SC¥80.0 bn
“Operating profit” share by segment

40%

Other*
Payment and
Finance
Developer¥40.2 bn
7.0%
4.7%
9.8%
23.6%

¥40.3 bn
1%
6%
11%
25%

SC

Department
Store

54.9%

FY2019*“Other” includes consolidation adjustments.

Developer
Payment and
Finance
Other

60%

Department
Store
SC

57%

FY2023

FY2030

Forecast

Image

27

FY2021 – FY2023 Medium-term Business Plan

Operating Profit Target by Segment
Full recovery of the Group cannot be achieved without recovery of Department StoreBusiness and Parco SC Business(Millions of yen）
SC Business

Department Store Business
23,00025,00025,00020,00020,00015,00015,00010,00010,000(1,200)5,000

0△5,000△5,000△15,000

Recovery of△10,000¥43.7 billion △15,000△20,000△20,000△10,000(20,785)
FY202025,000

FY2021E
FY2021
Forecast

Payment and Finance Business

FY202015,00015,00010,00010,000

421

1,200

2,300

FY2020

FY2021E
FY2021
Forecast

FY2023E
FY2023
Forecast

0△10,000△15,000

5,000

FY2021E
FY2021
Forecast

FY2023
FY2023E
Forecast

Developer Business

25,00020,000△5,000Recovery of¥17.0 billion(6,896)△25,000

FY2023
FY2023E
Forecast

20,000

5,000

1,800

5,000

0

△25,000

10,200

1,981

3,500

4,500

0
△5,000△10,000△15,000

FY2020

FY2021
FY2021E
Forecast

FY2023E
FY2023
Forecast
28

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Response to Changes in Market“What will recover,” “what will not recover” and “what will further grow” are becoming clear
Urgent to respond to segmentalized fashion market while strengthening strong areas
Expected changes insales composition by customer type
(%)

100%
90%

Expected changes insales composition by merchandise category*

23.7

90%

GaishoLuxury23.5

Cosmetics

11.2

18.6

Women’s volume /women’saccessories

14.9

9.7

Men’s clothing /children’s clothing

8.2

9.2

Art/jewelry/kimono

13.0

Food

22.0

Homeware/other

7.2

80%

12.5
9.4

Inbound

70%

6.0

60%

60%

50%

50%
40%

40%
30%

17.3

30.0

80%
70%

(%)

100%

66.9

General

64.0

30%

20%

20%

10%

10%

0%

0%

23.6

9.1
FY2019FY2023E
FY2023
Forecast

FY2019*Total of 9 flagship stores according to internallymanaged merchandise classification

FY2023E
FY2023
Forecast

29

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Progress of OMO Initiatives (1)Digitalization of touch points using app
App users

App users
sales

1.12

175.0

millionpeoplebillion yen*Result for the last one year

*As of H1 FY2021

Rate ofutilization

外商

75.9

Spend
per app user

2.5

%

times
一般

*Result for the last one year

*Result for the last one year
Comparison to in-house card holders who do not register for app

ギフト
Centralized management of customer information / purchase information through single
sign-onand sophistication of CRM

Target number of app users for FY2023: 2.4 million people30

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Progress of OMO Initiatives (2)Accelerate digital shift such as OMO (= Online sales target of ¥40.0 billion in medium-term plan)
Online sales forecast
by customer type
45,000Online sales forecast
by merchandise category

45,000(Millions of yen)

(Millions of yen)

40,00040,00035,000

現金・カード顧客他
Cash/card

35,000

外商顧客
Gaisho30,00030,00025,00025,00020,00020,00015,00015,00010,00010,000

5,000

5,000

0

ギフト
Gift

Cosmetics/art/
化粧品・アート・コネス他
Connaissligne/other0
2019年度FY2019FY20192020年度FY20202021年度FY2021見通し
Forecast

2023年度FY2023
目標
Forecast

2019年度FY20192020年度FY20202021年度FY2021見通し
Forecast

2023年度FY2023
目標
Forecast*Online sales are total sales through online payment for department store website, DEPACO, etc., gaisho’s conaissligne and live shopping.

31

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Progress of OMO Initiatives (3)Prepare to create OMO shopping sites● Cosmetics OMO site・・・Plan to launch in February 2022

Can select and buy
what I want online orin stores anytime!

Can sell online andin stores alike!
Can also use data!

Informationdelivery

Onlinecustomer service

WebinarVarious data
will be linked<Customer>

Information
一般 provision

Customer service
in stores<Brand>ギフト
Realize our own OMO that expands “human” power using digital technologies

Online sales target for FY2023: ¥5.0 billion

32

FY2021 – 2023 Medium-term Business Plan

Department Store Business – Progress of OMO Initiatives (4)Evolution of gaisho online activities
Purchase shareof customers in their
20s to 40s+4.2 pts

connaissligne
Onlinecustomer
servicestartedin September

外商
化粧品
アート
コネス
他

一般
*The figures is as of H1 FY2021.

ギフト

Further expand prime products, services, experience value
Online sales target for FY2023: ¥10.0 billion

33

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Business Model Transformation
Need to drastically overhaul content provided in stores and floor allocation

Expand content that adds color to life and creates fulfilling lifestyle
Direction of overhaul

Expand prime content(luxury, art, jewelry/watches)

Redesign and expand content by shifting focus to lifestylee.g. cosmetics ⇒ beauty/wellness

Introduce new content by shifting focus to experiencee.g. education, entertainment, incubation

Decrease originally curated space by half (13,200 ㎡⇒7,000 ㎡) /further decrease women’s volume zone clothing (Down 21% from FY2016 ⇒ down 30%)

Give priority to expanding content that makes strength stronger

34

FY2021 – FY2023 Medium-term Business Plan

Department Store Business – Business Model Transformation
Launch business model transformation to “Nagoya-version” department store
hybrid one during current Medium-term Business Plan period Achieve top position of gaisho business in terms of assortment, service and space quality
 Build highly profitable department store model with optimally balanced mix of kaitori shiire and shoka
shiire* and fixed-term lease using advantages of three building structure

Content

GaishoRespond to segmentalized market
Provide new experience value

Strengthen response to new rich

Structural reform

Area strategy

Reform/streamline HR structure

Maximize real estate value

Share ofgaisho sales

Share offixed-term
lease

50

40

%

%

Create areas that generate overwhelming value including development of areas around department stores*Kaitori shiire means purchase on a no return basis and shoka shiire means purchase recorded at the time of sale.

35

FY2021 – 2023 Medium-term Business Plan

Department Store Business – New Content

Entered subscription business
AnotherADdress

Total numberof subscribers

5,260
people

一般*The figure is as of H1 FY2021.

ギフト

Create new sustainable consumption style36

FY2021 – FY2023 Medium-term Business PlanSC Business – New Content

Promote development and expansion of timeless content and digital shift
Plan to open medical wellness mall Welpa in Shinsaibashi PARCO (November)Broad offering ranging from medicalcare to product sales and services

Chance to know health care andcomfortable environment to experience

Convenience only commercial
facilities can provide

UX-based online services that
support use of place

ポスト（対2019年度）

Study its results and consider introducing it to other Parco stores andDaimaru/Matsuzakaya stores across Japan37

FY2021 – FY2023 Medium-term Business Plan

Payment and Finance Business ー Build Platform for Growth
Strengthen product appeal and earning power through renewal of credit cards in January 2021
Changed accounting method for annual membership from lump sum reporting to prorating(IFRS) in H2 2020
Adjusted operating profit is expected to rise above FY2018 level in FY2021 and reach almost¥3.0 billion in FY2023

Operating profit of Payment and Finance Business
Operating profit(Millions of yen)

Annual membership adjustments

3,000
2,600
2,500

2,000
1,400
1,497
1,500

2,740
2,360
1,909

1,000

1,076
1,200

500
421
0

FY2017FY2018FY2019FY2020

FY2021
FY2021E
Forecast

FY2023
FY2023E
Forecast 38

FY2024 and beyond (next Medium-term Plan and beyond)Developer Business ー Deep Cultivation of Key Areas
Preparations for key development areas that have the key to “regrowth” for FY2024 and beyond
are making steady progress
Department Store and Parco “jointly” create various attractions to show exclusive strengths【Nagoya Sakae area】【Osaka Shinsaibashi area】

BINO Sakae

Nagahori-dori

Redevelopment of
Nagoya Nishiki 3-chome Disrict 25(Planned to open in 2026)

Shinsaibashi
ZERO GATE

Parking

Shinsaibashi
PARCO

Daimaru
Shinsaibashi(Main)

Shinsaibashisuji

NagoyaZERO GATEWhite Avenue

Midosuji(Main)

Hisaya-odori

Matsuzakaya
NagoyaHisaya-odori

Isemachi-dori

Otsu-dori(North)Parking(South)Daimaru Interior building
Musee Air Shinsaibashi(South)NagoyaPARCO(West)

midi(East)

Yabacho-dori(South)Wakamiya-dori

39

The Group Structure Reform
Reduction of fixed costs (lowering of break-even point)
Business model reform

HR structure reform

Cost structure reform

Reduce fixed costs ¥10.0 bn compared to FY2019

Expect to reduce ¥3.7 bn in FY2021(Including cost, compared to 2019)

Consider uncertain business environment, study additional measures40

Sustainability Management
Implementation of Corporate Credo “Service before Profit” = CSVRealization of
decarbonizedsociety

Integrate
corporate
strategies /businessstrategies withsustainability
management

Realization ofcustomers’
healthy/safe/
secure life

Realization ofwork-life
integration

Promotion ofdiversity &inclusion

７ materiality
issuesManagement of
the entire supply
chain

Coexistencewith local
communities

Clarify long-termgoals for 2030
using KGIs/KPIs

Promotion of
circulareconomyAttention to all stakeholders
Create both social value and economic value

41Appendix

42

<Reference＞

FY2020 Results by Segment(Retroactive adjustment associated with adoption of new segments)(Millions of yen)

Gross sales
Department StoreSC
Developer
Payment and Finance
Other
Consolidation adjustments
Revenue
Department StoreSC
Developer
Payment and Finance
Other
Consolidation adjustments
Business profit (loss)
Department StoreSC
Developer
Payment and Finance
Other
Consolidation adjustments
Operating profit (loss)
Department StoreSC
Developer
Payment and Finance
Other
Consolidation adjustments

Q1

Q2

H1

Q3

Q4

H2

113,990)
63,649)25,989)14,819)2,345)
16,575)(9,387)63,459)25,784)
8,658)
21,637)
2,095)
13,677)(8,394)(3,879)(4,353)
109)
1,026)
132)
(102)
(692)
(27,103)(23,233)(4,242)
784)
72)
(418)
(66)

206,644)
130,411)51,996)
12,553)2,867)
18,906)(10,090)
84,011)
48,612)
14,508)
11,253)
2,498)
15,629)(8,490)4,130)
1,428)
841)
704)
313)
589)
252)
6,466)
2,840)
1,171)
913)
381)
904)
255)

320,635)
194,060)
77,985)27,373)
5,212)
35,481)(19,478)
147,471)
74,397)
23,166)32,890)4,593)
29,307)(16,884)
250)(2,924)950)
1,731)
446)
486)
(439)
(20,637)(20,392)(3,071)
1,698)
453)
485)
188)

213,972)
132,571)
56,867)
12,732)3,060)
20,097)(11,357)
83,228)44,856)
15,553)
13,484)
2,337)
16,618)(9,622)
1,640)
(137)
573)
921)
(17)
544)
(244)
2,153)
192)
1,016)
712)
(0)
676)
(444)

234,845)
150,396)
61,025)
10,681)3,223)
20,029)(10,511)
88,379)54,577)
16,729)7,450)
2,104)
16,633)(9,115)
476)
125)
(515)
188)
(31)
623)
86)
(5,781)(586)(4,913)
(429)
(32)
562)
(382)

448,818)
282,967)
117,893)
23,414)
6,284)
40,127)(21,868)
171,607)
99,433)32,282)
20,935)
4,442)
33,251)(18,737)
2,116)(11)58)
1,109)(49)
1,167)(157)(3,628)(393)(3,896)283)(32)1,238)(827)

FY2020*The previous year’s actual figures have been retroactively adjusted in accordance with the standards for the new reportable segments adopted in FY2021.
*As Daimaru Matsuzakaya Department Stores Co. Ltd. absorbed Daimaru Matsuzakaya Sales Associates Co. Ltd. on September 1, 2021, the previous year’s
figures have been retroactively adjusted.

769,453)
477,028)
195,878)
50,787)
11,496)75,608)(41,346)
319,079)
173,831)55,449)53,825)9,035)
62,559)(35,622)2,366)(2,936)
1,008)
2,840)
396)
1,654)(597)(24,265)(20,785)(6,968)
1,981)
421)
1,724)(638)

43

<Reference> Consolidated total and major subsidiaries

Fixed Costs Reclassified Due to Store Closure (FY2021 and FY2020)(Millions of yen, %)First six months offiscal year ending
February 28, 2022

Portion of cost

Portion of SGA

Consolidated

TY

LY

ChangePersonnel expenses

243

1,124

(881)

Rent expenses

20

16

Depreciation

597

Other
Total

TY

Total (effect on business profit)

Daimaru Matsuzakaya
Department Stores

LY

Change464

2,130(1,666)

4)

21

31

2,018

(1,421)

1,064

352

838

(486)

1,213

3,998

Personnel expenses

0

Rent expenses

TY

Parco

LY

Change707

3,254(2,547)

(10)

41

47

(6)

3,104

(2,040)

1,661

5,122

(3,461)

382

2,172

(1,790)

734

3,010

(2,276)(2,785)

1,932

7,439

(5,507)

3,146

11,437(8,291)

0

0)

354

1,216

(862)

354

1,216

(862)

20

9

11)

15

31

(16)

35

40

(5)

Depreciation

236

527

(290)

991

2,521

(1,530)

1,227

3,048

(1,821)

Other

264

364

(100)

931

2,928

(1,997)

1,195

3,292

(2,097)

Total

521

900

(379)

2,292

6,697

(4,405)

2,814

7,597

(4,783)

Personnel expenses

50

490

(440)

14

348

(334)

64

838

(774)

Rent expenses

0

0

0)

0

0

0)

0

0

0)

Depreciation

360

1,491

(1,131)

24

175

(151)

384

1,666

(1,282)

Other

86

472

(386)

14

184

(170)

100

656

(556)

Total

497

2,455

(1,958)

52

708

(656)

550

3,163

(2,612)44https://www.j-front-retailing.com

Create andBring to Life
“New Happiness.”

Forward-looking statements in this document represent our assumptions based on information currently available to us and inherently involve potential
risks, uncertainties and other factors. Therefore, actual results may differ materially from the results anticipated herein due to changes in various factors.