Financial Results for FY2021
May 12, 2022
Benesse Holdings, Inc.

This presentation contains forward-looking statements concerning the future plans, strategies, beliefs and performance of Benesse Holdings, Inc. and its subsidiaries. These forward-looking
statements are not historical facts. They are expectations, estimates, forecasts and projections based on information currently available to the Company and are subject to a number of risks,
uncertainties and assumptions. As such, actual results may differ materially from those projected.

Financial Results Summary for FY2021
Shinsuke Tsuboi
Managing Executive Officer, CFO (Chief Financial Officer),
Executive General Manager of Finance and Accounting
Benesse Holdings, Inc.

FY21 results summary Increase in sales and income YoY

Net sales up ¥4.4bn, 1.0%, Operating income up ¥7.0bn, 54.1%, YoY
But net income down ¥2.0bn, 65.9%, YoY on loss from transfer of Berlitz

 Large increase in income vs. forecast

Operating income ends at ¥20.1bn, beating initial forecast of ¥17.5bn
Transfer of Berlitz secures NP of ¥1.0bn vs. forecast of ¥0.0bn

 Steady progress on 「V-shaped recovery in phase 1 (FY21-FY22)」

・V-shaped recovery in first year in the Education Business in Japan(Operating income ¥13.8bn in FY19→¥19.0bn in FY21）
・Income down in Nursing Care Business on fall in occupancy rate from COVID-19（Operating income shrinks ¥3.3bn vs. FY19, ¥2.3bn YoY）

 One-time special loss in FY21 on 「transfer of Berlitz」

However, expect lower tax burden from FY22 to add to ongoing profit growth tohelp improve capital efficiency and CF

2

Highlights for FY21
Steady progress toward V-shaped recovery, net income down on
one-time loss from transfer of Berlitz
500.0

Net
sales

450.0

448.5

431.9

427.5

Operatingincome 15.0

(Billions of Yen)

21.2

20.1

20.0

400.0
350.0

＋1.0％

300.0

25.0

13.0

＋54.1％

10.0

250.0
5.0

200.0
150.0

0.0

FY19
20.0
18.0

FY20

FY21

15.4

16.0

9.2

10.0

FY20

FY21

12.0

16.7

Ordinary
14.0
income 12.0

FY19

8.0

6.2

6.0

＋66.3％

6.0

10.0

Net
income*8.0

3.1

4.0

4.0

Impact of Berlitz transfer(ー)Loss on transfer: ¥9.5bn(+)Fall in taxes, etc.: about ¥3.8bn

2.0

2.0
0.0

-65.9％
1.0

0.0

FY19

FY20

FY21

FY19

FY20

FY21

*Net income attributable to owners of the parent

3Change in FY21 operating income by segment (YoY)
Large income increase on recovery in the School & Teacher Support business, and Cram School/Classroom
businesses, halving of losses at Berlitz(Billions of Yen)

-0.2

20.0

-2.3

+3.9

-1.3

＋7.5

15.0

-0.4
10.0

5.0

0.0

13.0

FY20

20.2

20.1

Others/FY21

12.6
Education in Japan＋7.1

Shinkenzemi

Education
Business

K&F

Nursing Care &Childcare

Berlitz

Reconcilliationsin Japan
ex. Shinkenzemi
・Total enrollments -2.9% YoY
・Optional courses performed
well・Schools＆Teacher support: rebound in Shinken
Simulated Exams, steady growth in Miraiseed
・Cram schools/Classroom: enrollments surpass
pre-COVID level・Impact of 2.5pt fall in occupancyrate
Mar 21 92.6％ → Mar 22 90.1％

・Structural reforms halve losses
・Transfer of all shares (inconsolidated account through 3Q）

4Change in FY21 operating income by segment (vs. FY19)
Overall steady progress toward V-shaped recovery in FY22, Education Business in Japan surpasses preCOVID level
However, ongoing COVID negative impact on Nursing Care & Childcare, K&F also still recovering

25.0

+4.6

＋0.5

-1.4

(Billions of Yen)

-3.3

20.0
15.0
10.0

21.2

+0.3

25.5
Education in Japan
＋5.2

-1.8

20.1

20.1

Others/

FY21

5.0
0.0

FY19

Shinkenzemi

Education
Business

K&F

Nursing Care &Childcare

Berlitz

Reconcilliationsin Japan
ex. Shinkenzemi

5

FY21 net income (changes from Operating income)Net income of ¥1.0bn includes ¥9.5bn loss on transfer of stock in affiliates from transfer of Berlitz(Billions of Yen)

25.0
20.0

-6.3

15.0
10.0

+1.5
-9.5

20.1

15.4

-0.1

5.0

-7.5
0.0
-5.0

Operating income Interest payable
on leases, etc.

Other nonoperating income

Ordinary income Loss on transferof stock inaffiliate

-0.9
+3.8

Other special

Taxes, etc.

Tax reduction

Net income

gains/losses(excluding

impact of Berlitz

attributable toimpact of Berlitz

transfer

non-controllingtransfer)

1.0

Net income

interests

FY21 Net income

6Toward reform and growth of theBenesse Group
Hitoshi Kobayashi
Representative Director and President, CEO
Benesse Holdings, Inc.

【Repost】Targets of the medium-term management plan
FY22 the final year of Phase 1, accelerate “reform and growth” as we move toward Phase 2

Positioning ofeach phase

Phase 1: FY21-FY22

Phase 2: FY23-FY25

V-shaped recovery

Challenge & growth

V-shaped recovery from the impact of COVID-19
organically in existing businesses

Aim for sustainable growth through inorganic means(new challenges in existing businesses)

Expand into new fields（Move into new fields and overseas territories by leveraging Benesse’s strengths）

FY23-FY25
Organic growth rate of 3%+（sales）

Financial
targets & KPI

FY22
Rebuild sales/OP to above FY19 levels in“2 years”**ex. ASRR impact

Based on FY22 earnings after V-shaped recovery from COVID-19 impact

FY25
OPM 8％+
ROE 10％+8

Executive summary Target V-shaped recovery in FY22, major improvement in ROEfrom transfer of Berlitz
 Aim for further growth from reform of existing businesses,
proactive stance on new themes (inorganic + new fields)
 Clarify financial strategy, implement strategic investment in
new growth9

FY22 earnings forecasts highlights
Expect net sales to fall on impact of Berlitz transfer (-45.0bn vs. FY19, -¥20.0bn YoY),
but major improvement in income and rise in ROE to 8.8%
5,000

Net
Sales

4,500

448.5

431.9

426.0

-1.4％

4,000

(Billions of Yen)

300

3,500

Operating
Income 200
250

25.0
21.2

20.1

＋24.0％

150

3,000

100

2,500
2,000

50

1,500

0

FY19

pre-COVID

FY21

FY22

FY19

pre-COVID

FY21

250

Ordinary
Income 150
200

16.7

19.5

ROE

100

Net
50
Income*00

pre-COVID

FY22

13.5

150

50

FY21

11.0%
9.0%
7.0%

＋26.6％

FY19

8.8%

200

15.4

100

FY22

1.8%

3.0%

0.7%

1.0%

6.2

-1.0%

1.0 ＋￥12.4bn
FY19

5.0%

FY21

-3.0%
-5.0%

FY22

pre-COVID*Net income attributable to owners of the parent

10

FY22 Operating income by segment (YoY and vs. pre-COVID)
Occupancy rate in Nursing Care business lower-than-expected at start of year in impact of COVID-19, but expect
achievement of V-shaped recovery on profitability improvement in Education in Japan and transfer of Berlitz(Billions of Yen)

FY21-22（YoY ）

30.0

+0.1

20.0
10.0
0.0

20.1
FY21

＋2.6

+0.6

+1.7

-0.6

+2.7

23.8

20.2
Education in Japan＋3.4
Shinkenzemi

Education Business

University students/

in Japanworking adults

-2.5

K&F

Nursing Care & Childcare

Berlitz

Others/Reconcilliations

25.0（Forecast）

FY22

ex. Shinkenzemi

FY19-22（vs. pre-COVID）

40.0
30.0

+4.7

20.0
10.0
0.0

21.2
FY19

＋3.3

+0.4

+0.3

-3.9

+3.1

Education 25.9
in Japan ＋8.5
Shinkenzemi

Education Business

University students/

in Japanworking adults

-4.4
24.8

K&F

Nursing Care & Childcare

Berlitz

Others/Reconcilliations

25.0（Forecast）

FY22

ex. Shinkenzemi

11【Repost】Targets of the medium-term management plan
FY22 the final year of Phase 1, accelerate “reform and growth” as we move toward Phase 2

Positioning ofeach phase

Phase 1: FY21-FY22

Phase 2: FY23-FY25

V-shaped recovery

Challenge & growth

V-shaped recovery from the impact of COVID-19
organically in existing businesses

Aim for sustainable growth through inorganic means(new challenges in existing businesses)

Expand into new fields（Move into new fields and overseas territories by leveraging Benesse’s strengths）

FY23-FY25
Organic growth rate of 3%+（sales）

Financial
targets & KPI

FY22
Rebuild sales/OP to above FY19 levels in“2 years”**ex. ASRR impact

Based on FY22 earnings after V-shaped recovery from COVID-19 impact

FY25
OPM 8％+
ROE 10％+Set out roadmap for achievement of financial KPI

12

Update on financial KPI for FY25
Plan to add to steady organically-driven growth by realizing new medium-to-long-term growth from taking on
new challenges

FY22 forecast

FY25
PL estimate【Net sales】【Operating income】¥426.0bn¥25.0bn¥500.0bn+¥40.0bn+【 Financial KPI 】

FY23-FY25
Organic growth atleast 3%
FY25
OPM at least 8%
Updated

FY23
ROE at least 10%

Contribution ration to growth in FY23-25 (breakdown)

Organic
Inorganic/
New fields+50.0～60.0bn

Organic80％+10.0~15.0+αInorganic/
New fields
20％＋

FY23-FY25
Growth contribution
at least 20% frominorganic/new fields

New

13

Organic

Inorganic/
New fields

Key measures for FY25

Proactively undertake measures to create organic growth and new growth
Organic■Shinkenzemi••

Inorganic

Raise profitability via improvement of retention
rate and reform of marketing
BYOD-based tablet strategy•

Develop platform business to address diverse
learning needs

■K&F

•

Raise profitability via improvement of retention
rate and reform of marketing•

Overhaul model to focus on “multi-layered” productservices■School &Teacher
support••Stabilize Mirai Seed earnings (Elem/J. High schools)
Boost product attractiveness via assessment x ICT(High schools)•

Bolster service model for schools with diverse
students’ education advancement (development +advancement support)■Cram schools/
Classrooms•

Grow number of schools and strengthen
uniqueness of each cram school•

Further increase industry share (M&A)■Nursing Care &Childcare•

Rebuild occupancy rate, expand strategic
locations•

Grow peripheral businesses with focus on HR
business (M&A)

New fields■University students/
Working adults■Overseasdevelopment•

Move into new markets (M&A), expand into recurrent education/reskilling markets utilizing Group’s
strengths•

Move into school assessment in India, consider and evaluate nursing care in China

Foundation: strongly pursue DX based on cross-organizational DIP (digital innovation partners)

14Organic

Shinkenzemi: April Shinkenzemi Enrollment and sales

April enrollee down 8.3% YoY overall, but forecast only 4.9% YoY decrease in sales
due to higher spending per enrollee
2019（pre-COVID）

2021（last year）

2022（this year）

YoY
changeChange (%)

High school
courses

150,000

140,000

110,000(30,000)(21.2)

Junior highschool courses

420,000

410,000

350,000(60,000)(14.8)

Elementary
school courses

1,240,000

1,360,000

1,280,000(80,000)(5.8)

810,000

810,000

750,000(60,000)(7.2)

2,620,000

2,720,000

2,490,000(230,000)(8.3)¥113.4bn¥122.9bn¥116.9bn(¥6.0bn)(4.9％)

KodomoChallenge

Total for Japan
Sales (Shinkenzemi +Kodomo Challenge)

15

Organic

Shinkenzemi: causes and countermeasures for fall in April enrollment

Causes ofenrollment fall

April enrollment weaker than expected, but target YoY increase in profit
External

Internal■Protracted impact from COVID-19…fall in children’s learning motivation*, increased economic
uncertainty, acceleration in birthrate decline■Increased competition with digital learning and online classes■Retentions: rise in high-activity enrollees in digitalization, but low-activity members still make up
30-40% ⇒ rise in numbers not studying outside school, outflow to cram schools/low-priced products■New enrollments: rise in Kodomo Challenge/Elementary school digital courses, but further fall in
paper courses
Marketing reform still ongoing ⇒ sales expenses allocated to various trials, but lowered efficiency■Retentions: cater to low-activity enrollees ⇒ encourage them to utilize Shinkenzemi with human support■New enrollments: establish trial marketing model ⇒ spread successful patterns, eliminate inefficientmeasures

Measures■Expand peripheral businesses to address diverse learning needs

Secure YoY profit increase in FY22 by developing further retention measures andincreasing marketing efficiency during the year
Gradually move to “next-generation Shinkenzemi model” from FY23 onward

16

Inorganic

Shinkenzemi: Platforms for diverse learning

Establish high-margin business model by making effective use of customer baseand addressing diverse learning needs

Raise LTV by growing peripheral businesses
FY25 target: net sales of ¥10.0bn+, OPM of 20%+

Steady growth in peripheral business from rise in high-activity enrollees and loyal users

Lineup expansion plans
Challenge School
・FY22 6 genres「Dance」「Art」「Abacus」「Calligraphy」「Programming」「Careers」

・FY23 12 genres

Expand by assessing market trends andcustomer needs

Expand genres as a platform via
in-house development and provision ofaccredited services

Growth and margin increase fromsales expansion①Sales using customer base
②Sales to potential
・Personalized proposals based on
customers (PCL*: about
customer behavior history❷非会員向け販売
9mn)
ゼミ会員

Current Shinkenzemi/
向け販売
Kodomo Challenge
enrollment(about 2.5mn)①Sales tomembers*PCL＝Potential Customer List

High-margin modelfrom efficiency in sales②Sales using digital means

・Personalized proposals utilizing“Learning Pocketbook”, “Shimajiro App”

Scale-up business

17Organic

Inorganic/
New fields

Education Business in Japan: School & Teacher Support BusinessHigh school business
Strengthen education advancement supportand high school-university linkages
 Begin support for high school students’ education
advancement in new areas in response toexpansion in admissions before December.
→Support for discovery of “learning catalyst” to enable highschool students to quickly discern the university/vocational
school that is the best fit for themElementary/Junior high school businessContinue to expand number of
elementary/junior high schools using Mirai
Seed in response to GIGA School Program Momentum remains brisk at start of FY22. Eyeing
about 9,000 schools vs. rollout target of 8,900
 Progress on paid software introduction atelementary/junior high schools in the market as awhole, about 75% of local authorities now using
paid software→Achieve both reduced guidance burden on high school
teachers and improved promotional impact foruniversities/vocational schools

High school
students

Universities/
Vocational
schools

Use “Careered support program” torealize high level of satisfaction for
university/school matches

Licensed educational
software Mirai Seed

About
6,000

7,942

End-FY22
target 8,900

Eyeing9,000

Number of schools using
the software
Apr 2021

End-FY2021

FY2022 target

18

Organic

Education Business in Japan: Cram schools/Classroom businesses

V-shaped recovery in FY21, continued brisk momentum at start of FY22
 Achieved V-shaped recovery in one year in FY21 (operating income up ¥3.5bn YoY)
 Mirroring last year, student numbers off to strong start amid ongoing COVID-19 impact
April enrollments

V-shaped recovery
from COVID-19
impact12
11

Strong start

10
9
8
7

109,000

99,000110,000

111,000

2019

2020

2021

2022

6
5

*April enrollments the combined total for Tokyo Individualized Educational
Institute, UP, Tetsuryokukai, Ochanomizu Seminar, and Benesse BE studio
19

Organic

K&F: recent changes in conditions in the China Kodomo Challenge business

Recent easing in competitive conditions, greater lockdown impact from late-March
Recent conditions

Enrollment in China

1.10mnIntensifying in competitive conditions■Easing in competitive conditions owing to govt. policy change(double reduction policy)

1.12mn・Succession of competitors shrinking or exiting business (easing in marketing
competition)
・Benesse so far not affected by restrictions due to its kindergarten basic
education and publishing operations

120
950,000

100
80

Apr-20

Apr-21

Apr-22

60■New enrollments and retentions brisk through early-March but
increased impact from COVID-19 lockdowns from mid-March・+6% vs. March new enrollment target through 2nd week, retentions also brisk

・Negative effect on enrollment from marketing suspension due to increase in
COVID-19 infections from late-March*Lockdown of 45 cities, including Shanghai

Recovery measures

・Bolster implementation of new marketing measures (member proposal
sales, etc.)

・Develop more basic educational materials and increase parental
support20

Organic

Nursing Care & Childcare business: improving occupancy
rate in nursing-care facility business

Bolster marketing strategy to improve occupancy rate. Target profitability recovery.
●Occupancy rate regains 90% level amid re-expansion in COVID-19
Recentconditions(in-facility
care business)→Occupancy rate -2.5pt YoY (92.6％ → 90.1％）●Recent uptick in pre-occupancy tours,

document requests also steady, so
customer interest levels high→Pre-occupancy tour volume up 20% vs. FY20

93.0%
92.0%
91.0%
90.0%
89.0%
88.0%
87.0%

(March tours at existing homes)

Change in occupancy rate
92.6%
90.1%

89.8%

State of emergency Jan–Mar,
Apr–Jun, Jul–Sep 2021

Mar-21

Focused measures toprevent spread
Jan–Mar 2021

Sep-21

Mar-22Strategy for improving occupancy rate
Building relationships withlocal hospitals and care managers
Measures【Utilizing Benesse’s unique strengths 】①Can market at the area level(create dominance in large urban areas)②Use of icebreaker offerings（for hospitals: elderly home introduction center, for homes:
meal deliveries）＋

Short stays (trials)【FY21: impact】■Rise in long-term contract volume via
hospitals/care managers*Oct-Mar totals(FY20:353→FY21:604)【FY22: bolster marketing strategy mostly in 1H】■Short stay trial campaign→ long-term
contracts21Organic

Nursing Care & Childcare: Benesse-style nursing care DX

Aim to improve QOL for residents by fusing IT and human knowledge
Sensing homes

Majikami AI solution
Service quality prioritizing QOL

Dementia carenursing home

Granda Yotsuya

 First Benesse-style sensing home opened in March
2022, plans to shift existing 55 homes to sensing
homes by FY23
 Created an AI solution based on teacher data from theknow-how of nursing care experts (Majikami)

Sleep quality

Analysis to detectchange fromthe norm

Thoroughly strengthen service foundation by fusing IT and human knowledge

Know-how ofnursing careexperts(Majikami)

Learning nursing
care know-how(Majikami AI)

Improve the nursing care skills of staff who
are not experts using the Majikami AI

27 years of nursing care business know-how, HR development capabilities
that are the roots of Benesse’s educational activities

22Organic

New fields

University students/Working adults: growth in existing fields
and new fields

Establish new company, challenge the solutions of issues in the university
students/working adults field
Market for working adults

Social issues

In this era of living to 100, Japan lags behind
US/Europe in “learning for a fruitful life”
Benesse intends to tackle solving the social
structure issues in the university
students/working adults field head on

Establish new company foruniversity students/working adults

Assessment market
４％

Qualifications
market(recurrent)

27%

Overseas
GlobalDomestic market¥1tn(2021 estimate）

inbound（foreign
workers）

Corporate
training market

Languagelearning market
18%(reskilling)

51%*Source: Compiled by Benesse based on the Education Industry 2021 Market Report publishedby Yano Institute Research Ltd. (Benesse estimate for assessment market)

Growth in existing fields and new fields
Existingfields・Further growth focused on Udemy

Corporate use FY19: 80 firms → FY21: at least 650
firms（Used by at least 45% of Nikkei 225 firms）
Further strengthen services for local authorities

New
fields・Examine new fields, particularly
corporate training, qualifications,assessment, and inbound markets（begin exploring M&A, partnerships, DIF alliances）

Target FY25 sales of about ¥40.0bn driven by new growth fields in the education market in Japan23

Financial strategy ❶ Stance on cash position
Transfer of Berlitz stabilized operating CF, expect business recovery/growthand lower tax costs to improve operating CF＜Financial discipline: stance on cash holdings＞

Funds equivalent to “customer deposits”, such as advances received, to be used for working capital and as funds to ensureliquidity/stability
However, about ¥40.0～¥50.0bn designated as investment standby funds will be used to actively explore investment
opportunities＜Cash for strategic investment and shareholder returns＞～FY25 adjusted operating CF

Total ¥130.0bn＜Adjustment＞

・FY22～FY25 Total operating CF ¥170.0bn
・Rise in advances received＋repayment oflease liabilities＝¥40.0bn

End-FY21 Investment standby
funds¥50.0bnof cash/cash equivalents and highly-liquid＋ ・Totalmarketable securities
about ¥160.0bn
・Advances received, Advances received fromnursing home residents, etc.
about ¥110.0bn

Assume a cash position of ¥180.0bn for the next four years

24Financial strategy ❷ Cash allocation and capital policy
In parallel with investments in reform/growth and strategic investments, wetarget both shareholder returns and strengthening of the financial foundation

Total four-year cash position around ¥180.0bn
Use① Investments in reform/growth ofexisting businesses Business investment (capex, etc.
*excluding lease assets）（estimate）¥70.0bn

Use② Strategic investments in the future

 M＆A/Digital Innovation Fund（estimate）¥50.0bn

Use③ Shareholders return and strengthening of financial foundation【Shareholder returns】

 Based on 35% lower limit for dividend
payout ratio, aim to continuously raise
dividends by growing post-tax net income¥25.0～¥30.0bn【Financial foundation strengthening】
Regain equity ratio of 30% by FY25
and retain some capital for future
investments¥25.0～¥30.0bn
25Plans for strengthening engagement
Scheduled IR events for FY22

 Business briefings for each segment

Business briefings focused on medium to long-term market trends
for Education Business in Japan, Nursing Care & Childcare Business ESG briefing

Establishment of ESG & Sustainability Office (Apr 2022)

26

Finally

ReformConsider reform of business models for existing
businesses to adapt to changing markets
Pursue productivity increases and more robust
structure

Growth

Add to organic growthby growing existing inorganic (peripheral)businesses and challenging new fields

Clarify and swiftly achieve financial KPI
27

Dividend outlook

Target FY22 dividend per share of ¥60,
up ¥10 YoY

28