First Half Results for FY2014(Six months ended August 31, 2014)

Lawson, Inc.
October 8, 2014

Copyright (c) 2014 Lawson, Inc. All rights reserved.

1

Financial ResultsforFirst Half of FY2014

Yutaka Yoshitake
Chief Financial Officer

Copyright (c) 2014 Lawson, Inc. All rights reserved.

2

Earnings Summary of First Half of FY2014

Net sales of all stores
Operating profit
Operating profit ratio
Recurring profit
Net profit
EPS (Yen)
Dividend per share (Yen)FY2012-1H
Actual
970.9
34.5
3.6%
34.2
17.8
178.82100

FY2013-1H
Actual
992.7
35.6
3.6%
35.5
19.0
190.67
110

Actual
994.6
40.0
4.0%
39.6
21.8
219.15120

Total no. of stores in Japan

10,912

11,384

11,987(Consolidated：Billions of yen)

FY2014-1H
YoY
vs. Plan
100.2%
97.1%
112.3%
105.6%+0.4%P+0.3%P
111.5%
106.5%
114.9%
112.8%
114.9%
112.8%
+10
±0
+603

+29

Note: The number of stores is a total number of convenience stores in Japan operated by the Lawson group.

Consolidated operating profit: 40.0 billion yen (+12.3% YoY). Up 2.1 billion yen versus plan, butroughly flat when excluding depreciation method changes, etc.
Gross profit margin rose on stronger sales of fast food items and on the improvement of gross marginof non-food items.
The impact from changes in depreciation calculations totaled 4.3 billion yen. SG&A expenses fell year
on year, and versus our initial plan.
Performance from Lawson subsidiary, Lawson Mart, Inc., fell short of plan.
Consolidated net profit: 21.8 billion yen (+14.9% YoY, +2.4 billion yen versus plan)
Copyright (c) 2014 Lawson, Inc. All rights reserved.

3

Existing Stores (Non-Consolidated*)* excluding LAWSON MART/LAWSON STORE100 business<FY2014-1H>Gross profit margin up 0.4ppt

Existing store sales down 1.0%
(number of customers down 2.8%,
spending per customer up 1.8%)

Existing-store sales contracted 1.0% YoY on continued slump in cigarette sales and poorsummer weather. The same measure excluding cigarette sales rose 0.5% YoY.
Gross profit margin rose 0.4p to 31.3%. Over-the-counter fast food sales fell below target andsoft drink sales were sluggish during the cool summer. However, strong sales of non-food items
helped boost the gross margin. The gross profit margin excluding cigarette sales rose 0.1p YoY.
As a result, the gross profit figure for existing stores, which links directly to franchise store profits,rose 0.3p YoY.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

4

Store Openings (Non-Consolidated*)*excluding LAWSON MART/LAWSON STORE100 business(Daily new store
sales in 1,000 yen)

(Net store increase)

Additional storesconverted from other chain
in Kanto region

Additional storesconverted from other chain
in Kansai region

496
319

177

New store openings proceeded roughly to plan, but we closed 23 fewer stores than planned.
As a result, the total number of stores increased by a net 29 stores.
Average daily sales per new store fell year on year to 491,000 yen.
Stripping out affiliates from other chains, the number of new store openings has been
approximately 400 stores between 2012 and 2014.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

5Key Components of SG&A Expenses
FY2014-1H
FY2013-1H
ActualActual Change
105.8
113.7
7.9

(Billions of yen)

Non-consolidated

Selling, general & administrative expenses

FY2014
Forecast
Increase 5-10%*Including the impact of around 7.0 billion yen in the SGA change of
FY2014-1H and around 5% in the SGA forecast of FY2014
respectively from the business restructuring of Ninety-nine Plus.

Major Strategic Expenses
Personnel expenses
IT-related expenses(Hardware leasing, software amortization, maintenance, etc.)
Advertising and promotional expenses

Consolidated SG&A expenses

17.9
7.5

18.4
6.9

0.5
▲ 0.6

5.0

4.0

▲ 0.9 Increase 15-20%

146.1

143.8

▲ 2.3

Increase 0-5%
Decrease 5-10%

Increase 0-5%

Note: Figures in italic indicate the revised figures from the initial plan.

Compared to plan

Compared to H1 FY2013

Copyright (c) 2014 Lawson, Inc. All rights reserved.

3.2 billion yen below plan
Other expenses: Changes to depreciation
methods exceeded initial assumptions by 2.0
billion yen, leading to a larger fall in total SG&A.

Group

Group

Lower costs at Lawson HMV Entertainment,
Lawson ATM Networks, and Lawson Fresh(included under the parent from July 1, 2014)

ParentParentOther expenses: 4.3 billion yen impact fromchanges to depreciation calculations. Total
expenses rose after facility expenses for the
restructured Lawson Mart and Lawson Store 100
operations were recorded on the parent account.

4.0 billion yen below plan
See parent above.
Plus determined efforts to control costs at all
consolidated subsidiaries.
6Earnings of Major Subsidiaries(Billions of yen)

Operating Profit of Major Subsidiaries
Lawson Mart, Inc.
Smart Kitchen, Inc.
Lawson HMV Entertainment, Inc.
Lawson ATM Networks, Inc.
Chongqing Lawson, Inc.
Shanghai Hualian Lawson, Inc.

FY2014-1H

FY2014

FY-endOwnership

ActualYoY change

Forecast

Feb.
Feb.
Feb.
Feb.
Dec.
Dec.

100.0%
100.0%
100.0%
76.5%
100.0%
94.0%▲ 0.98▲ 0.31
1.53
3.18▲ 0.38▲ 0.45▲ 0.98
+0.51
+0.14
+0.00
▲0.00
▲ 0.10▲ 1.60▲ 0.303.20
5.80▲ 0.70▲ 0.50Note: Figures in italic indicate the revised figures from the initial plan.
Note: Smart Kitchen was absorbed into Lawson, Inc. on July 1, 2014. Its data spans the four months from March to June, 2014 only.

Lawson Mart

Expanded to 25 stores. Lawson Store 100 recovery in sales proved slow, pushingthat operation below plan. Lawson Mart, Inc. and the Lawson Mart division reported
a combined 1H profit of 30 million yen, and are forecast to generate a full-year profitof 300 million yen in FY2014.

Smart Kitchen

Absorbed into Lawson, Inc. on July 1, 2014. Lawson Fresh (including the portion
under the parent) reported an operating loss of 400 million yen as expected..

Lawson HMC Entertainment

Profit up on strong ticket sales for large-scale concerts and theme park admissions.
Newly-acquired United Cinema Holdings to be included in consolidated PL from 3Q.

Lawson ATM Networks

Profit held steady YoY. Lower income from fewer ATM transactions was offset by a
net increase in new ATM machine installations, and revised ATM management costs.

Copyright (c) 2014 Lawson, Inc. All rights reserved.

7

Capital Expenditures and Cash Flows (Consolidated)
Consolidated Capital Expenditures（Billions of yen）

Subtotal for capital expenditure

FY2012-1H
Actual
18.6
3.9
2.7
1.3
26.7

FY2013-1H
Actual
16.0
3.5
2.4
1.0
23.1

FY2014-1H
Actual
21.3
2.9
2.4
0.8
27.5

Depreciation and amortization

20.8

22.8

19.9

New stores
Existing stores
IT-related
Other

FY2014
Plan

43.5
8.5
12.0
1.0

65.0
42.6

Note: Figures in italic indicate the revised figures from the initial plan.
（Billions of yen）

Consolidated Cash flows

FY2012-1H
Actual

FY2013-1H
Actual

FY2014-1H
ActualFree cash flows

53.3▲ 28.924.3

61.7▲ 29.831.9

92.1▲ 38.2
53.8

Cash flows from financing activities▲ 14.7▲ 19.4▲ 8.6

Approx. 95.0
Approx. ▲115.0
Approx. ▲20.0
Approx. ▲5.0

(Cash dividends paid)

▲ 9.2

▲ 9.9

▲ 10.9▲ 23.0Cash and cash deposits

83.3

86.2

113.7

Cash flows from operating activities
Cash flows from investing activities

FY2014
Forecast-

Note: Figures in italic indicate the revised figures from the initial plan.

Operating cash flow increased temporarily with the period-end falling on a Sunday, Approx total:
60.0 billion yen in real terms.
Investing and financing cash flow temporarily affected by acquisition of United Cinema Holdings,
Inc.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

8

FY2014 Consolidated Company Forecasts
Net sales of all stores
Operating profit
Operating profit ratio
Recurring profit
Net profit
EPS（Yen）
Dividend per share (Yen)ROE

FY2012
Actual
1,906.5
66.2
3.5%
65.9
33.1
332.20200
15.2%

FY2013
Actual
1,945.3
68.1
3.5%
68.8
37.9
380.04220
16.1%

FY2014 Forecast
Plan
YoY
1,982.0
101.9%
75.0
110.1%
3.8%+0.3%P
73.9
107.3%
38.9
102.5%
389.33
+9.29
240
+20
▲0.7%P
15.4%

Total no. of stores in Japan

11,13011,606

12,288+682

Gross profit of existing stores (YoY)
Net sales of existing stores (YoY)
Gross profit margin ratio

101.2%
100.0%
30.5%

101.5%
99.8%
31.0%

100.0%
98.9%
31.4%▲1.5%P▲0.9%P+0.4%P

Gross profit margin difference excluding cigarettesales (YoY)+0.5%P+0.4%P+0.2%P▲0.2%P(Billions of yen)(Non-consolidated)

Note: The number of stores is a total number of convenience stores in Japan operated by the Lawson group.
Note: Figures in italic indicate the revised figures from the initial plan.

Consolidated OP forecast unchanged at 75.0 billion yen. New conservative existing-store sales
estimate.
Improve sales trend through aggressive use of strategic promotional funds for non-Ponta customers.
Gross profit at existing stores to hold steady thanks to 0.4-point YoY improvement in gross profit
margin. FY2014 forecast of gross profit of existing stores (YoY) is 100%.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

9

Financial Discipline: Appropriate Control of Risk & Return

Acquisition of SEIJO ISHII CO., LTD.
EBITDA

Approx.

7.2billion yen

Corporate
value

Approx.

47.0 billion yen(Ref.)

Profit for theyear

55.0 billion yen(tax adjusted)（tax unadjusted)

4.4 billion yen
ROE +1.0p
Approx.

(12-month basis from 13/9 – 14/8)⇒EV/EBITDA =6.5 times⇒ EV/EBITDA = 7.6 times(12-month basis from 13/9 – 14/8)⇒ Consolidated

EV/EBITDA multiple near 7. High investment efficiency.
Expected to boost Lawson consolidated ROE by over 1.0p.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

10

Risk Management
Improved information security system
StoresCreated the Lawson Group Personal Information Protection Policy.
Policy regarding in-store mistakes or customer complaints clearly laid out in store
manuals.
HQ employees

Conduct regular checks to see if the Lawson Office Security Rules are being observed.
Business partners

Ensure any business that involves personal information is appropriately outsourced.
Check their systems for the protection of personal information.

Use own HACCP to ensure thorough hygiene management
We have established our own hazard analysis and critical control point (HACCP) system toprevent incidents of food poisoning or food tampering.
Example: We keep detailed records on important food processing management factors such as cooking times
and product temperature. In the unlikely event of any incident occurring, we are able to swiftly locate the cause
and take immediate action.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

11

Lawson’s Management Policy
andFY2014 2H Business Strategy

Genichi Tamatsuka
President and CEO
Representative Director
Copyright (c) 2014 Lawson, Inc. All rights reserved.

12

Small Neighborhood Stores Strong Growth Potential
Aging society
Nuclear families
Women in work

Changing family structures

Short
time

On wayhome fromwork（10,000 households）

1,100

700

Proximity

1,065

500

890(19.4%)

783(19.9%)

745(14.9%)484(10.6%)333(6.6%) 3-generation
households

560(14.2%)
1989年

2001年

2013年

National Livelihood Survey, Ministry of Health, Labor and Welfare

Retail stores in Japan(million ㎡)

160

1.6mln

1,600

140

1,400

120

0.9mln 100

1,200
1,000

80

800

60

600

Future households in Japan(10,000 households)

6,000

People perhousehold

3.1
5,000
4,000

Total
39.42 mln

3,000

304
774

2,000

2,864

Total
45.66 mln

Quadrup
3.225
le in
Total
years 22.42mln
50.11 mln

3

households
have amember over
over 65
1,083 1 member
2.6 is 65
All1,159 members
2.8

664
2.63

973
2.51

40

400
legal entities

Wife ashomemaker(21.3%)

300(000 stores)

200(20.8%)

900

Walking
distance
1,800

930(23.5%)

Both adults
working951

individual owners

floorspace

0

20
0

1985 1988 1991 1994 1997 1999 2002 2004 2007 2012
Business surveys (1985～2007), Economic Census of Business Activity 2012

over 65All

2,930

2,759 members
2.2
under 65

2

1,000
1 98 9 年

20 0 1年※45% of total

2.4
Double in
25 years

20 13 年

National Institute of Population and Social Security ResearchSocial change has huge implications forthe convenience store industry.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

13

Develop Small Neighborhood Store Operation
Expand customer base

Expand profit-generating
opportunities

Stronger products● MACHI café, Machikado● Over-the-counter fast food● Health products● Value-added items

Multiple channels for
maximum convenience
Responding to neighborhoodchanges
NATURAL LAWSON, SEIJO ISHIILAWSON MART
Stronger healthcare ranges
Last one mile

Small neighborhood
store format● Offer all basic CVS services● Increase range of expected basic services

Profit opportunities

Strengthen services● Entertainment, ticket sales● ATM, finance

Product
power● Admin services

Supply chain
management

Stronger
distribution

Threeessential
practices
Maximize
ICT
use

Effective
response
to change

Stronger
store
operations

Stronger FC
model

Fresh business
opportunities

Outside Japan● China● Southeast Asia
● North America

Customer
relationsmanagement

Lawson’s core focus is to strengthen its small neighborhood store response andpresence, by strengthening its three essential practices, its product power and its
ability to respond effectively to change.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

14

Product Strategy – Responding to Change ①

Stronger basic products

Lawson’s own unique products
Innovative product ranges●Consistent improvements in basic necessities●Products unique to Lawson●Far-reaching cost performance improvements,●Value products with that little bit extra

and consistent underlying efforts to boost value●Earn wider customer respectex●Tuna mayonnaise rice balls●Mixed sandwiches●White fish & seaweed lunchbox●Revolutionary collaboration with

manufacturers●High repeat visits

ex●Taste of Home!
●Pure Series●Bran Bread●“Karaage-kun” fried chicken

Support framework/infrastructure

SCM, raw materials procurement

Innovation lab, manufacturer collaboration

CRM, grasp needs of individual
customers and stores

Comprehensive marketing strategy

Use SCM, CRM and marketing to support development of solid basic
ranges, and unique, Lawson-defining items.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

15

New Store/Format Strategy- Responding to change②

Regular LAWSONStrengthen and refine product range to meet market and social changes
FreshproduceCounterfast food& deliHigh
valueadded

Cooked in
store

Healthproducts

OTC
drugs

LAWSON MART

NATURAL LAWSONStores with a strong healthcare focus

LAWSON STORE100SEIJO ISHII

Pharmacy LAWSONUse lessons learned through multi-format stores to strengthen andrefine regular LAWSON stores
Copyright (c) 2014 Lawson, Inc. All rights reserved.

16

First Half Existing-store Monthly Sales Trends(%)

Varying times forrecording ticket sales
resulted in volatile
year-on-yearchanges

Following the sales-tax hike, we saw volatile totals for ticket sales andpoor weather. However, 1H sales contracted year on year mainly
because the overall trend was weaker than expected.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

17

Strategy for the FY2014 Second Half

Getting customers to try somethingelse, come back again.
Supporting
customers’
everyday livingwith ranges to rival
any supermarket

Copyright (c) 2014 Lawson, Inc. All rights reserved.

Speedypolarization
response

Promote Lawson’s
appeal to Ponta
members and nonmembers alike18

Product Strategy - MACHI café: Bigger, Better Menu
Two unique Lawson flavors
Almost too good for aconvenience store

Heartfelt hospitality

The flavor of
attentive service

The flavor ofwonderful taste＋
Pricing

Simplified pricing structure by removing special
会員価格の廃止し、わかりやすい価格に変更
ブレンドについてはSサイズ（100円）を新設
price for members. Introduced 100-yen start size.

Buyingincentives

テレビCMなど新規購買につながる集客策を投下
Attracted new customers through TV ads, etc.

Busy stores

Introduced ice machines, placed two machinesside by side. Considering other ideas.

Encourage more customers to experience these two unique flavors.
Offer superior quality to boost competitiveness and customer visits.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

19

Product Strategy - MACHI café: Effect of Broader Menu
Began offering Start (S) size at all MACHI café from September 30, 2014
Number ofitems sold

+35%

Total sales

Gross profit

+10%

+10%

After introducing lower-priced, low-margin S size,
number of items sold, total sales and gross profit all increased.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

20

Product Strategy – Typical Price Revisions
2014 Second Half pricing strategy

Monthly pasta sales （PSA/D)
(%)

(Yen)

8,000

100

6,000

Beef
bolognaise

75

2,000

Sharp fall in sales
from April.
Introduced rapid
leverage in June.

5025530 yenUpgraded the beef andcheese ingredients for ahigher-value product.

Meat sauce
4,000

450 yen409 yen

399 yen

Returnedd price to pre-sales
tax hike level to help
customers recognize it.

Carbonara

460 yen410 yen

パスタ
販売高PSA/DSales
of pasta (PSA/D)
パスタ
販売高PSA/D前年比
Salesof pasta YoY (PSA/D)

0

0

Reduced price after
comparing with competitors.

Mar
Apr
May JuneJulyAug
14/03月14/04月14/05月14/06月14/07月14/08月

Some categories suffered immediately after the sales tax hike.
Revised some prices in Second Half to make them more attractive to customers.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

21

Product Strategy – Overall Balance
Value-added items: The challenge: - to create fresh customer value
Lawson’s unique items: Use pride ingredients to differentiate with other companies
New
seriesMorerice

As good
as handmade

Taste of Home!
Niigata koshihkari rice
seriesRegular basic products are themainstay underpinning salesMore
ingredients

Roll-your-own rice balls
Pre-rolled rice balls

2013
Spring2014
Spring

Proportionof sales

26.0%

Proportionof sales

33.3%

ＳＫＵ

9

ＳＫＵ

11

Proportionof sales

66.7%

ＳＫＵ

21

Proportionof sales

ＳＫＵ

74.0%
23

Rice ball category

Concentrate equally on boosting value-added items and consistently
improving our mainstay regular basic items and unique Lawson items.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

22

Sales Promotion – for Ponta Members & Non-members

Ponta members
Continue current
actionFood tasting tokens
Bonus points
Boost Ponta member
companies for added
customerconvenience

Non-Ponta members
Take stronger action
Simple pricing
Repeat action points
until awareness
improves

Maintain current promotions for Ponta members.
Take more aggressive action to attract non-Ponta members into stores.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

23

Achieve both of quality and quantity in store development

Area strategy

Ponta data
commercial area
analysis

Property info

Regional branches
Regional offices

Property info
Owner candidate info

Area team meeting(franchise store owners)

Store format meeting●Area development strategy●Merchandise assortment forcustomers in the area
●Strict ROI standards

First Half result : Net increasing 299 stores
FY2014 target : Net increasing 600 stores (same as original plan)
Copyright (c) 2014 Lawson, Inc. All rights reserved.

24

Recent M&A – United Cinemas
Synergy with core business
United Cinemas Co., Ltd.
FY13 sales: 20.0 billion
yen
FY13 OP: 1.0 billion yen
36 theatres, 331 screens

Stronger entertainment business = more ticket
purchasers = greater attractiveness = stronger
core business
Films head the entertainment hierarchy.
Acquiring better contents=better promotion for
CVS business

LAWSON
storesCD/
DVD

Financial discipline
HMV
storesMajority of funds for the acquisition sourced
through non-recourse loans(Leveraged buyout scheme)= Minimized risk money for Lawson parentSecond-handitems
Games

Affiliates’
websites

CinemasTickets

Films/
concerts

Other instore
items

Books
maga
zines
Goods

Spot
venue
sales

Trips
LAWSON
websiteIncorporating cinemas as a major channel of entertainment should attract morecustomers to the whole group, and strengthen core business.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

25

Recent M&A – SEIJO ISHIIHigh value-added supermarket chain advocating“Quality food for a quality life.”
SEIJO ISHII uses its own business model to develop & manufacture tasty, safe,
secure foodstuffs, and pursue high value-added products and services.
⇒Many common points with Lawson in terms of manufacturer retailer skills.
⇒Strengthen Lawson’s core business through small-format neigborhood stores.
Loyal customers value SEIJO ISHII’s quality products, stores and customer relations.
⇒Protect SEIJO ISHII’s organizational culture, corporate DNA and inherent businessstrengths⇒Maintain products & stores. Lawson to provide infrastructure support on
distribution, store development, etc.
Stores currently located mainly in station buildings in major urban areas⇒Strengthen Lawson Group’s geographical expansion strategy, especially in Kanto
region.

Copyright (c) 2014 Lawson, Inc. All rights reserved.

26

M&A – SEIJO ISHII’s Brand Power & High Profitability
Profitability

Product mix

FY2013 gross OP margin

0

20

Sales by category30

40

FY2013 OP margin

Freshproduce
Processed
Items
food
delivereddaily,
delicatessen

Seijo Ishii(Reference)
Company X
Food supermarket

Company A
Company B
Company C
0

2

4

6

8

Sales by brandNational
brand

Privatebrand
Including Central
Kitchen(Reference)
Company Y
Upmarketsupermarket

10

FY2013 sales per tsubo (3.3 square meters)
Seijo Ishii

Store locations
and size

Company A

Department stores
165sqmCompany B
Company C
0

2

4

6

8

※Data taken from individual companies’ financial reports
Copyright (c) 2014 Lawson, Inc. All rights reserved.

10

Offices, etc.
165sqm
Shopping centers
200sqmStationbuildings
150sqmRoadside
430sqm27

Financial Discipline – Cash Flow
Rough picture of cash flow based on convenience store business in Japan(opening 1,000 stores)

Operatingcash flow
Approximately
100 billion yen

Investing cash
flow
Approximately
60 billion yen

How free cash flow is used
Free cash flow
Approximately
40 billion yen

Lease
repayments
Dividends

Free cash flow used to pay dividends and repay leases.
M&A is funded through leveraged debt.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

28

Medium-term Roadmap
Gross
operating profit

Consolidated
operating profit
100 billion yen

Non-consolidated
LawsonConsolidated
subsidiaries

ROE 20%
Dividend increase/share buy-backback andcancellation

Increase grossprofit margin by
0.4%point per year

Selling,
general andadministrative
expenses

Existing stores'
gross profit

Net increasein stores
by 5% per year

Industry
consolidation

Initiatives toward 1) 100 billion yen in operating profit and 2) ROE 20%
Maintain capital discipline with emphasis on ROIC
Differentiation by products with high GPM and multiple store formats
High customer retention through CRM leveraging Ponta card data analysis
Productivity improvement through SCM reform
Capitalize on consolidation opportunities
Copyright (c) 2014 Lawson, Inc. All rights reserved.

29

Reference

Copyright (c) 2014 Lawson, Inc. All rights reserved.

30

Half Year Breakdown of FY2014 Forecast(Consolidated: Billions of yen)

Net sales of all stores
Operating profit
Operating profit ratio
Recurring profit
Net profit

1H Initial Plan
1,024.0
37.9
3.7%
37.2
19.4

FY2014 Forecast
1H Actual
2H Plan
987.3
994.6
34.9
40.0
3.5%
4.0%
34.2
39.6
17.0
21.8

Full-Year Plan
1,982.0
75.0
3.8%
73.9
38.9

99.7%
98.7%
31.4%

100.0%
98.9%
31.4%(Non-consolidated)

Gross profit of existing stores (YoY)
Net sales of existing stores (YoY)

Gross profit margin ratio

101.3%
100.0%
31.3%

100.3%
99.0%
31.3%

Note: Figures in italic indicate the revised figures from the initial plan.

Copyright (c) 2014 Lawson, Inc. All rights reserved.

31

First Half of FY2014 Balance Sheet

As of Aug. 31, 2014

Total current assets(Cash and deposits)(Accounts receivable -other)

Total noncurrent assets
Property, plant and equipment
Intangible assets
Investments and other assets(Long-terms loans receivable)(Lease deposits)

Total Assets

261.0
124.9
65.2
461.2
251.1
36.3
173.7
35.9
90.0
722.3

Copyright (c) 2014 Lawson, Inc. All rights reserved.

(Billions of yen)
Change from
As of Aug. 31, 2014
Feb. 28, 2014

Change fromFeb. 28, 2014

65.3
48.1
11.0
36.0
17.7
7.8
10.4
2.1
3.8
101.3

Total current liabilities(Accounts payable -trade)(Deposits payable)
Total noncurrent liabilities(Long-term guarantee deposits)

Net Assets(Common stock)(Retained earnings)

Liabilities and net assets

317.4
113.7
112.3
142.4
30.9
262.4
58.5
148.4
722.3

70.7
24.5
24.8
18.6
▲ 1.2
11.9
10.2
101.3

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LAWSON MART
Lawson Group(Consolidated)

Lawson, Inc. (Non-consolidated)
Commission
Lawson Mart, Inc.
(100% Subsidiary)

Commission

Sales
Direct Running StoresFranchise Stores

Lawson Mart, Inc. Lawson, Inc.
Net Sales of allconvenience stores

DirectNet Sales

DirectFranchise commission
form franchise stores

FC

DirectFC

DirectDirectFC

DirectDirect = Direct Running Stores
Copyright (c) 2014 Lawson, Inc. All rights reserved.

Lawson GroupFC
FC = Franchise Stores
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Cautionary Statement
This presentation contains forward-looking statements and forecasts regarding the future plans, strategies andperformances of Lawson and its subsidiaries and affiliates. These statements and forecasts are not historical facts. They
are expectations based on assumptions and beliefs derived from information currently available to the Company and are
subject to risks and uncertainties including, but not limited to, economic trends, heightened competition in the domestic
convenience store sector, personal consumption, market demand, the tax system and other legislation. As such, actual
results may differ materially from estimates.
Figures in this presentation have been rounded down.
Copyright (c) 2014 Lawson, Inc. All rights reserved.

34