April 11, 2023

LIFE CORPORATION
Financial Results Briefing
For FY2022(Fiscal year ended February 28, 2023)

LIFE CORPORATION

1. Full-year FY2022 performance overview
2. Review of the 6th Medium-Term Plan
3. Overview of the 7th Medium-Term Plan
4. Shareholder return policy
5. Full-year forecast for FY2023―2―

LIFE CORPORATION

1. Full-year FY2022 performance overview―3―

LIFE CORPORATION

Key points for full-year FY2022 earnings

1. 19 consecutive years of sales growth*・Existing store net sales almost 100% YOY*
2. Ordinary profit ¥20.0 billion
・¥10.6 billion ordinary profit in FY2022 2H:
second highest
・Full-year ordinary profit: ¥5.4 billion higher
than FY2019 (pre-COVID-19)*Results are compared using the figures before the application of the “Accounting Standard for Revenue Recognition”―4―LIFE CORPORATION

Full-year FY2022 performance overview (consolidated)(Unit: Millions of yen)

Item

Operatingrevenue
OperatingprofitOrdinary profit
ProfitFull-year FY2022

Full-year FY2021

765,426

19,14820,015

13,327768,335

22,932

23,695

15,208Changeー*2(16.5%)*2(15.5%)*2(12.4%)*1 Accounting treatment methods are different for comparative periods due to the application of the “Accounting Standard for Revenue
Recognition.” Accordingly, changes in operating revenue from the previous period are not stated.
*2 Accounting treatment methods are different for comparative periods due to the application of the “Accounting Standard for Revenue
Recognition.” However, changes from the previous period are stated because the effects on amounts are immaterial.
.

―5―

*1

LIFE CORPORATION

Reference: Effects of the application of the “AccountingStandard for Revenue Recognition”(Unit: Millions of yen)
Full-year FY2022
Before the application

EffectAfter the application①

Operating revenue（②＋⑤）

785,627(20,200)

765,426②

Net sales

761,873(23,378)

738,494③

Cost of sales

523,697(14,785)

508,911④

Gross profit

238,176(8,593)

229,582⑤

Receipts fromoperating revenue

23,753

3,177

26,931⑥

Operating grossprofit261,929(5,415)

256,514⑦

Selling, general andadministrative
expenses242,774(5,409)237,365⑧

Operating profit

19,155(6)

19,148* Major factors derive from the changes in accounting methods of, among others, rents for tenants, our point system, and transactions inwhich purchase of goods, etc. is recognized at the time of sales thereof (shoka shiire)* Effects on each profit item below operating profit are immaterial.

―6―

LIFE CORPORATION

Factors of changes in operating profit(on a basis before the application of the Accounting Standard for Revenue Recognition)
Increase in operating gross profit＋7,951
Increase inreceipts
fromIncrease in
Operatinggross profit
revenue+7,451

Increase in selling, general and administrative expenses(11,728)
Decrease in remodelingand repair expenses+1,546+499
Increase in
freight costs Increase inpromotional(974)
expenses

22,932(Unit: Millions of yen)

(750)

Increase inutilities
expenses(4,114)

Increasein rent
expenses(1,446)

Increase inothersIncrease in
Increase inpersonnel
depreciation
expenses(4,365)(716)

19,155(905)

Decrease in operating profit(3,777)Full-year FY2021

Full-year FY2022―7―

LIFE CORPORATION

Operating revenue trends(on a basis before the application of the Accounting Standard for Revenue Recognition)•

Operating revenue increased due to stores opening, existing stores being
remodeled, and the expansion of online supermarkets and the BIO-RAL
section in FY2021 and FY2022.
(Unit: Billions of yen)785.6

■Operating revenue

800.0

700.0
629.9

652.9

677.7

698.6

759.1

768.3

20

21

714.6

584.9

600.0

500.0

400.0

376.1

386.7

300.0
03

04

・

・

・

・

・ ・ ・ ・

14

15

16
―8―

17

18

19

22 (Fiscal year)

LIFE CORPORATION

Existing store net sales trends(on a basis before the application of the Accounting Standard for Revenue Recognition)• Existing store net sales of 104.5% compared to FY2019 before COVID-19• Comparable level to FY2020 when demand for eating at homeskyrocketed
(%)

106.0

105.3
104.6

105.0

104.5

104.0
103.0
102.0
101.0

100.0

Existing store net sales to FY2019

100.0
99.0
19

20

21
―9―

22

(Fiscal year)

LIFE CORPORATIONNet sales/gross profit ratio by division(on a basis before the application of the Accounting Standard for Revenue Recognition)•

Gross profit ratio increased due to increased sales of original products and products with highfunctionality
Net sales(Unit: Millions of yen, %)Gross profit ratio

Full-year FY2022

Full-year FY2022
Existing stores

Department(Unit: %,)ChangeAll storesvs. FY2021

vs. FY2021

vs. FY2019

Difference
from
FY2021

Difference
from
FY2019

Food products

662,769

102.4

99.7

105.5

31.7

+0.3

+1.8

produce

101,673

103.1

100.6

109.6

29.6

+0.1

+2.3

Seafood

58,555

99.1

96.3

104.7

32.0

(0.3)

+2.2

Meat

85,012

101.9

99.2

107.7

31.2

+0.2

+1.9

Delicatessen

86,692

105.7

102.5

107.1

55.0

+0.1

+1.3

Groceries

330,835

102.0

99.5

103.5

26.3

+0.3

+1.4

Lifestyle products

65,751

101.4

100.6

100.0

27.2

+0.5

+2.3

Apparel

23,289

100.6

101.3

91.5

40.1

+0.8

+1.7

Others

10,063

103.9

105.4

104.5

10.0

(0.2)

+0.1

761,873

102.3

99.9

104.5

31.3

+0.3

+1.8

Total

― 10 ―

LIFE CORPORATION

Selling, general and administrative expenses【personnel expenses】(on a basis before the application of the Accounting Standard for Revenue Recognition)• Continue to improve compensation as part of investment in employees
Personnel expenses were ¥4.3 billion higher than FY2021
Trends in personnel expenses and the sales ratio
120,000
100,000

Personnel expenses

86,82792,724(Unit: Millions of yen, %)Personnel expenses to sales ratio

97,430104,076

109,579

113,945

15.0
15.0
14.7

80,000

14.5
14.0

14.1

14.1

60,000

15.5

13.5

13.7
40,00013.0

13.2
20,000

12.5

The 6th Medium-Term Plan

0

12.0
17

18

19

20
― 11 ―

21

22(Fiscal year)

LIFE CORPORATION

Selling, general and administrative expenses 【utilities expenses】••

Electricity rates continued in increase, ¥3.9 billion more than FY2021
Electricity rates are expected to increase in FY2023■ Breakdown of utilities expenses
Gas rates(Unit: Millions of yen)

Water rates

14,00012,699605

12,00010,000
8,000

1,161
8,132
351

1,093

8,585
401

1,135

6,000
4,000

Electricity rates

10,932
6,686

7,048

20

21

2,000
0
― 12 ―

22(Fiscal year)

LIFE CORPORATION

Initiatives to improve corporate structure•Continued to improve gross profit ratio, cost optimization and productivity while
maintaining sales capabilities■ Improving gross profit ratio■ Cost optimization•

Expanding original products•

Implementing effective sales promotions•

Expanding private brand products•

Revising and abolishing materials and•Expanding utilization of food process
centersothers•Bringing some operations in-house•

Expanding stores with semi-self■ Improving productivity•

Utilizing AI ordering•

Introducing electronic price tags (83stores in the Tokyo region)

checkouts•

Promoting paperless operations (partiallysystem introduction)― 13 ―

LIFE CORPORATION

Ordinary profit trends• Increased profit due to improved corporate structure
30.0(Unit: Billions yen)

Ordinary Profit

28.1

25.0

23.6
20.0

20.0

14.5

15.0

12.9

12.8

12.5

12.8

15

16

17

18

11
10.0

7.7
5.0
13

14

― 14 ―

19

20

21

22
(Fiscal year)

LIFE CORPORATION

Consolidated balance sheet
End-February, 2023

(Unit: Millions of yen, %)End-February, 2022

Change80,49074,480+8.1

Cash and deposits

9,727

9,809

(0.8)

Inventories

26,061

24,138+8.0

Accounts receivable - trade

9,209

8,133

+13.2

Accounts receivable - other

29,66428,544+3.9

Others

5,826

3,854

+51.2

Non-current assets

200,319

195,748+2.3

155,880

150,490+3.6

Intangible assets

3,218

3,508

(8.3)

Investments and other assets

41,22041,749(1.3)

280,810270,229+3.9

158,807

159,929(0.7)

74,17069,108+7.3

Total net assets

122,002110,299+10.6

Total liabilities and net assets

280,810270,229+3.9

Current assets

Property, plant and equipment

Total assets
Total liabilities(Interest-bearing liabilities)― 15 ―

LIFE CORPORATION

Consolidated cash flow

(Unit: Millions of yen)

Full-year FY2022

Full-year FY2021

ChangeCash flows
from operating activities

23,899(7,926) *+31,825

Cash flows
from investing activities(23,839)(20,303)(3,536)

Cash flows
from financing activities(142)

22,695(22,837)

Cash and cash equivalents
at the end of period

9,327

9,409

(82)

* The decrease in operating cash flows results mainly from the settlement of liabilities in FY2021 for the purchasing of products and otheractivities, which were pending because the last day of FY2020 fell under the holiday of financial institutions.

― 16 ―

LIFE CORPORATION

2. Review of the 6th Medium-Term Plan

― 17 ―

LIFE CORPORATION

Review of the 6th Medium-Term Plan
Investment in employees

Made stores more suited to local needs
by delegating authority

Investment in products

Expansion of delicatessen, private
brand products and value-added
products contributed to improve grossprofit ratio

Investment in stores

Store renovations contributed to
improve profitability

Strengthening infrastructure(process centers)

Expanding utilization of food process
centers contributed to improved sales
capabilities of stores

Strengthening card business

Expanding card business revenue
Utilizing marketing

Despite ongoing initiatives, the 6th Medium-Term Plan was largely achieved― 18 ―

LIFE CORPORATION

Investment in employees•

Ongoing investments to utilize human resources as a driving force for growth■ Maintaining a rewarding work environment•

Delegating authority to stores

Achieve product line-ups suited to local needs•

Corporate culture that allows free

BIO-RAL （developed, deepened, new）

suggestion•

Personnel change based on internal

Promoting highly motivated employees

recruitment■ Treatment improvement•

Personnel system reform

Increased opportunities for a wide range of
employees•

Continuous wage increases

Increased returns to employees

Employee satisfaction improved― 19 ―

LIFE CORPORATION

Investment in products•Continued aggressive product development, and “taste” and “quality” are topics of conversation

Highly rated in a national TV program ranking project
Crab sticks categoryNo. 1
Ketchup categoryNo. 1
Men-tsuyu categoryNo. 3
Mapo tofu seasoning category No. 3
LIFE PREMIUM
Crab umami
condensed
crab flavor kamaboko

Private brand name

Net sales(Unit: Millions ofyen)

LIFE PREMIUM
BIO-RAL
Luxurious thick tsuyu
Organic JAS Tomato
boasting Umami and
Ketchup
broth

Sales
composition (%)

YoY (%)

LIFE PREMIUM
Addictive spiciness andumami Mapo tofu
seasoning

Number of
items

Smile Life

44,723

103.1

5.9

829

LIFE PREMIUM

7,588

93.4

1.0

158

BIO-RAL

5,192

179.1

0.7

264

start select10,864

100.4

1.4

208

68,369

104.8

9.1

1,459

Total

― 20 ―

LIFE CORPORATION

Investment in stores•

Strengthen sales capabilities by investing in aggressive store renovations

Implementing BIO-RAL corner

Expanding frozen food corner

Introducing Breeze Garden

Expanding pet food and baby food

Introducing Uo sushi cornerintroducing face-to-face kitchen― 21 ―

LIFE CORPORATION

Culmination of the 6th Medium-Term Plan
Central Square Yebisu Garden Place StoreAwarded first place in “STORE OF THE YEAR 2023”**What is “STORE OF THE YEAR 2023”?
Diamond Chain Store, a magazine specializing in the retail industry, ranks the stores opened that year, and it has an
impact on the industry from the voting by readers, retailers, experts and others.
― 22 ―

LIFE CORPORATION

Strengthen infrastructure (process centers)•

Reorganizing the process centers in the Osaka region dramatically expanded production capacity•

Expanding the utilization of process centers and satellite kitchens contributed to improving productivity andthe full lineup of products in stores

Expanding production of bento lunch boxes
and the delicatessen

Shokado-stylecompartment bento

The delicious taste of broth with flying fish!
Deep-fried young chicken thighs withthree kinds of soy sauce

Process center developed products

Roast chicken with quinoa
and tomato sauce

The delicious taste of broth!
Simmered hijiki seaweed― 23 ―

Expanding fresh food processing

Fillet of silver salmon

Yakiniku set(five kinds, six pieces)

Utilization of satellite kitchens

Large slice!
Saikyo-yaki silver salmon bentowith seaweed

Gapao rice (10-grain rice)& Gai Yang

LIFE CORPORATION

Strengthening card business•

Strengthening company cards (credit cards and electronic money) contributed to grouprevenueE-moneyCompany credit card

©Disney

LC JCB Card
(Disney design)

LC JCB Card
(Normal design)

500,000 members*

Providing convenience
to customers

Marketing utilizing point
card information*Number of members at the end of February 2023

― 24 ―

LaCuCa4.71 million members*

Reducing cashless
settlement fees

LIFE CORPORATION

Online supermarkets• Sales were 148% of previous year from opening new stores and increasing
capacity at existing stores(Unit: Billions of yen)

■ Online supermarket net sales trends(Total of Life online sales from Life online supermarkets and Amazon)

100.0

14.2
9.6
5.3
1.9

2.4

3.1

17

18

19

20

21
― 25 ―

22・ ・ ・ ・ ・ ・30(Fiscal year)

LIFE CORPORATION

Company-wide initiatives under the 6th Medium-Term Plan•

Company-wide initiatives to improve the gross profit ratio under the 6th Medium-Term Plan
resulted in ＋3.2P improvement throughout the period■ Gross profit ratio trends (on a basis before the application of the AccountingStandard for Revenue Recognition)

(%)

32.0
31.0
30.6

31.0
30.0

29.5
28.8

29.0
27.7

28.0
27.0

31.3

27.9

28.1

27.3
26.9

26.0
13

14

＋0.8P

＋3.2P

The 5th Medium-Term Plan

The 6th Medium-Term Plan

15

16

17

18

19

20

21

22
(Fiscal year)― 26 ―

LIFE CORPORATION

3. Overview of the 7th Medium-Term
Plan（FY2023〜FY2026）― 27 ―

LIFE CORPORATION

Significance of formulating a Medium-Term Plan••

Realize the Corporate Philosophy with all employees in alignment and making it their own andcontinuing to take on challenges from a medium- to long-term perspective
Steady improvement in ordinary profit since the start of the Medium-Term Plan

■ Ordinary profit trends
Began formulating a Medium-Term Plan

(Unit: Millions of yen)

(Fiscal
year)

1998〜
2001

2002〜
2004

2005〜
2007

2008〜
2011

2012〜
2014

2015〜
2017

2018〜
2022

MediumTerm Plan

Unenacted

The 1stThe 2ndThe 3rd

The 4thThe 5th

The 6thAverageordinary
profit/year

2,300

3,918

8,019

10,056

8,675

12,78919,851― 28 ―

LIFE CORPORATION

What we want to be in FY2030•

The plan does not set short-term goals but rather aims for “what we want to be
in FY2030” from a medium- to long-term perspective, and the first four years
through FY2030 were set as the 7th Medium-Term Plan.

【Qualitative targets】

LIFE will become a company that everyonesays, “It’s my supermarket,” as acommunity-based supermarket.

― 29 ―

LIFE CORPORATION

What we want to be in FY2030【Quantitative targets (financial)】

Item

Target:Net sales¥1 trillion

Ordinary profit¥35 billion

Profit¥22 billion

Number of stores

400 stores― 30 ―

LIFE CORPORATION

What we want to be in FY2030【Quantitative targets (non-financial)】
Item

Target:CO2 emissions(Scope1・2)

50% reduction
vs. FY2013

Food waste*

50% reduction
vs. FY2017

Employee satisfaction (ES)4.0
(out of a maximum of 5.0)

Ratio of female managers

20%(ratio within management)

Percentage of male employees
taking childcare-related leave100%* Final food waste per net sales― 31 ―

LIFE CORPORATION

External Environment Accelerated population decline and aging
 Competition intensifying further
 Rising resource prices and increasing
operating costs
 Growing awareness of sustainability
 Development and acceleration of digitization― 32 ―

LIFE CORPORATIONThe keyword of the 7th Medium-Term Plan is “Linking”
・ Responding to customer needs
・ Providing a pleasant shopping experience through the
products and services

Customers

・ Reducing environmental impacts
・ Contributing to local
communities

Local community

Employees

Business
partners

・ Realizing Corporate
Philosophy

Shareholders
and Investors
・ Appropriate information
dissemination
・ Improve the quality of dialogue

・ Sustainable trade
・ Environmental considerations― 33 ―

LIFE CORPORATIONThe 7th Medium-Term Plan Main Themes
1. Investment in employees
2. Breaking away from the homogeneouscompetition
3. Contribution towards the realization of asustainable and flourishing society“Linking the circle of Kaizen activities”
to promote the above― 34 ―

LIFE CORPORATION

Main theme 1 “Investment in employees”•

Providing value to our customers by creating a “system and environment” to promote the success of diverse
human resources and provide educational opportunities, leading to employee growth, highly productive work
styles, and improved employee satisfaction (ES).

•Aiming to be a company where employees say, “I want to work at LIFE” and “I want to keep working at LIFE.”

Personnel
system change

Rewarding work
environment

Employee
growthI want to workat LIFE

Diverse
employees
thriving

Productive wayof working

Having room tospare in timeand mind

ES Improvement― 35 ―＝

Maintaining
opportunities
and anenvironment for
employees togrow and thrive

Engagement
improvement

LIFE CORPORATION

Main theme 2 “Breaking away from the homogeneouscompetition”••

Providing a stable supply of products that can only be purchased at LIFE through our own supply networkand making them available both in warm and attractive real stores and a convenient online environment.
Aiming to provide “just right” proposals to each customer by utilizing digital and data.
＜Product＞
Full lineup of
attractive
products uniqueto LIFE“Deliciousness”“Freshness”“Originality”＋“Reasonable
price”＜Process center＞＜Distribution center＞

Providing safe, secureand delicious products
at optimal cost on astable and timely basis＜Real stores＞
The best store in thecommunity thatconnects with local
customers＜Online＞
Providing a convenientand comfortable
shopping environmentthat is not bound by timeor location＜Digital＞
Linking “customers,”“products,” “stores,”and “online”
Just the rightsuggestion for a
comfortable shopping
environment for eachcustomer in real
stores and online

Utilization of Data
Each head office department and store utilizes its own data to create a product lineupand store that suits local customers.
Productivity improvement
Supporting efficient work styles through a combination of system utilization and operation improvement― 36 ―

LIFE CORPORATION

Main theme 3 “Contribution towards the realization ofa sustainable and flourishing society”••

Establishing materiality in order to “contribute towards the realization of a sustainable and flourishing society,”as stated in our Corporate Philosophy
In the 7th Medium-Term Plan, we aim to address these issues and achieve sustainable growth through theefforts of each department.

Category

Materiality

Initiative
theme

E: Environment

S: Society

Reducing theburden on theenvironment

Providing safe, highvalue-added
products andservices

・Reduce food waste

・Ensure safety andsecurity

・Reduce plastic
waste
・Reduce CO2
emissions・Promote
responsible
procurement
・BIO-RAL business

G: GovernanceContributing to local
communities as
infrastructure foreveryday life

Creating a
motivating
workplaceenvironment where
diverse personnel
can thrive

・Run stores stably・Diversity

・Diversification of
shopping options

・Healthmanagement

・Contribute to local
communities

・Human resource
strategy― 37 ―Development of anorganization withhigh value andethics・Corporate
governance・ComplianceLIFE CORPORATION“Linking the circle of Kaizen activities”• Company-wide efforts to continue to change for the better by not being
satisfied with the status quo but by recognizing and solving problems on ourown.
• Through this activity, we will improve productivity and optimize costs to growthe company, which will lead to improved treatment.
Kaizen for
operations
Kaizen fortreatment

Circle of
KaizenKaizen for
the work
place

Kaizen for
motivation

Kaizen for
performance― 38 ―

LIFE CORPORATION

Overview of the 7th Medium-Term Plan•

We will become a company that local residents say, “It’s my supermarket,” by working on three main themes that are
based on our Corporate Philosophy, which are the raison d'etre of our company, and on corporate culture.
Corporate
Philosophy＜Corporate Philosophy＞

VisionThrough “reliable management with noble
aspirations” contribute towards the realizationof a sustainable and flourishing society

True to LIFE
Declaration＜Corporate Culture＞
Think and act from the customer's point of view
Employee teamwork - challenging spirit
A sense of mission to support local lifelines

LIFE Pledge
Code of Conduct＜The 7th Medium-Term Plan Main Themes ＞

Investment in employees
Employee growth/ES Improvement

Breaking away from thehomogeneous competition
Full lineup of attractive products unique to
LIFE
Attractive real stores
Realize a convenient online environment

Contribution towards the realizationof a sustainable and flourishingsociety
Create economic value/social value/environmental value

Linking the circle of Kaizen activities

A company that everyone says, “It’s my supermarket”― 39 ―

LIFE CORPORATION

4. Shareholder return policy― 40 ―

LIFE CORPORATION

Shareholder return policy•

Together with formulating the 7th Medium-Term Plan, whose period began in fiscal 2023, and while
adhering to the previous basic policy, the Company has established a new shareholder return policythat reflects quantitative indicators based on the Company’s belief in placing greater emphasis on the
return of profit to its shareholders in conjunction with medium- to long-term growth of the Company.

While giving comprehensive consideration to strengthening
the financial foundation looking ahead to fiscal 2030 and to
future business development, and while maintaining a basic
policy of paying dividends, targeting a dividend payout
ratio of 30%, the Company will also remain mindful ofcontinuing to pay stable dividends with a dividend on
equity ratio (DOE) of 3% as a guide.
― 41 ―

LIFE CORPORATION

Reference: Dividend per share trends• Based on the new shareholder return policy, the dividend will increase
in FY2023 (a total of ¥80 per share planned)(Unit: yen)
• Continued to pay dividends without reductions since listing

80(Planned)

70
Commemorative dividends

1050

Year-end
Interim

25

25

25

12.5

12.5

12.5

30

30

30

15

15

15

15

12.5

12.5

12.5

15

12

13

14

15

15

15

15

16

17

18

― 42 ―

40
35

30

40
30

70

25
20

20

19

25

20

30

21

35

22

40

23

(Fiscal year)

LIFE CORPORATION

5. Full-year forecast for FY2023― 43 ―

LIFE CORPORATION

Full-year forecast for FY2023 (consolidated)• Aiming to increase sales and profit in the first year of the 7th Medium-Term(Unit: Millions of yen, %)Plan
FY2023 Full-year

Full-year FY2022

ChangeChangeOperatingrevenue

801,000

765,426+35,574+4.6

Operatingprofit19,80019,148+652+3.4

Ordinary
profit20,50020,015+485+2.4

Profit13,50013,327+173+1.3― 44 ―

LIFE CORPORATION

Full-year FY2023 initiatives•

Achieve a profit increase by absorbing the expected increase in electricity rates in FY2023

Item

Initiatives

Sales

•
•
•

Strengthening sales capabilities of existing stores
10 new stores
Expanding online supermarkets

Gross profit•••

Expanding original products, such as the delicatessen
Expanding private brand products
Expanding utilization of process centers

•

SG&A

Electrical price tags will be introduced in all stores in the Tokyo
region and will start introducing them in the Osaka region• Expanding AI ordering fresh produce section• “Linking the circle of Kaizen activities”*Overall initiatives of the 7th Medium-Term Plan
― 45 ―

LIFE CORPORATION

Investment plan

(Unit: Millions of yen)

FY2023 Full-year

Full-year FY2022

New stores

8,700

16,897

Renovation

2,600

927

IT and digitalsystems

6,400

Process center

1,000

Others(expensive equipment,
major repairs, etc.)

Total

Major contents

Open 10 new stores
7 major store renovations

Expanding use of electricalprice tags
2,385
Cash register-related
equipment, etc.

952

Production facilities, etc.

3,700

3,064 Existing store facilities, etc.

22,40024,225― 46 ―

LIFE CORPORATION― 47 ―