M A R U I G R O U P C O . , LT D

Financial Results Briefing for theF i s c a l Ye a r E n d e d M a r c h 3 1 , 2 0 2 2 ,And Future Outlook

May 12,2022

S c h e d u l e f o r t o d a y ’s p r e s e n ta t i o n1Overview of Performance and Segment Income in
Fiscal Year Ended March 31, 2022
Hirotsugu Kato, Director, Managing Executive Officer ,CFO

2

Human Capital-Focused Management
Hiroshi Aoi, President and Representative Director,
Representative Executive Officer, CEO1Overview of Performance and Segment
Income in Fiscal Year Ended March 31, 2022
Hirotsugu Kato,
Director,
Managing Executive Officer,
CFO

My name is Kato.
I will now give an overview of the financial results for the fiscal year ended March 31,
2022 and explain the status of each business segment in light of the progress of theMedium-Term Management Plan.

O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Fu l l -Yea r Fo re ca st fo r Fi s ca l Yea r
E n di n g M a rc h 3 1 , 2 0 2 3

O v e r v i e w o f Pe r f o r m a n ce a n d S e g m e n t I n co m e
i n F i s c a l Ye a r E n d e d M a r c h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
5

Let me start with consolidated performance.

Highlights in Fiscal Year Ended March 31, 2022
1. Three main KPIs (EPS, ROE, and ROIC) greatly increased year on
year, meeting all targets, but EPS and ROE are at about 70% of thelevel in fiscal year ended March 31, 2020, while ROIC is at about90%
2. Total group transactions increased 16% year on year to a record
high of ¥3,373.4 billion
3. Consolidated operating income increased 140% to ¥36.8 billion(¥0. 3 billion above target)

Net income rose approx. 700% to ¥17.8 billion(¥1. 3 billion above target)

4. FinTech segment posted operating income of ¥41.2 billion, arecord high. Although Retailing segment achieved its target of¥2.0 billion, this is only approx. 20% of the level in the fiscal year
ended March 31, 2020

There are four highlight points for the financial results.
The three main KPIs all significantly improved year-on-year in reaction to last year's
COVID-19 and the increase in provision for loss on interest repayment. They
recovered to levels ranging from 70% to 90% compared to pre-COVID levels.
Total transactions reached the ¥3 trillion level for the first time due to growth in
FinTech segment transactions.
Consolidated profit also achieved the plan with a significant increase compared to theprevious year.
By segment, FinTech recovered to a level higher than before COVID-19 and achieveda record operating income, while Retailing increased its profit compared to theprevious year, but the impact of COVID-19 still remains significant compared to
FinTech.

6

Main KPIs

■ ROIC・WACC■ ROE・Capital costs

■ EPS
（yen）

117.0

85.8

(VS. target
+6.2)

100

（％）

ROE

8.8%
8

4

50

（％）

7.8%

3.7%

7.7%

6.5%

Capital
costs
6.9%

ROIC

(VS. target+0.6%)

3.5%

3.5%

3.3%

3

(VS. target+0.1％)

WACC

3.0%

2

1.4%
10.6
FY2020 FY2021 FY2022

0.8%
FY2020

FY2021

FY2022

FY2020

FY2021

FY2022*The figures above have been calculated in accordance with the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Results for the two
previous fiscal years have also been revised by retroactively applying said accounting standard.

Main KPIs.
As I explained earlier in the summary, the past three years have not yet seen therecovery to the pre-COVID level, although there have been significant increases
compared to the previous years.
ROE and ROIC the year were below capital costs and WACC, respectively. Therefore,
we are aware that they must be exceeded in the fiscal year ending March 2023.

7

Main financial indicators■ Total Group transactions（Billion yen）

■ Operating income

3373.4(VS. target -36.6)
3000■ Net income（Billion yen）

2903.72912.2

40（Billion yen）

25.3

36.8

41.8

(VS. target+0.3)

17.8

20

20

(VS. target +1.3)

10

15.2

1000

2.3
FY2020

FY2021

FY2022

FY2020

FY2021

FY2022

FY2020

FY2021

FY2022*The figures above have been calculated in accordance with the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Results for the two
previous fiscal years have also been revised by retroactively applying said accounting standard.

Main financial indicators.
Transactions, while slightly below plan, reached the ¥3 trillion level for the first time,
well above the pre-COVID level, due to the increase in FinTech transactions.
Both operating income and net income achieved the plan, although they did not reachthe pre-COVID levels.

8

Segment Income (Revenue and Operating Income)■ Retailing■ FinTech

（％）
6

ROIC

3.4

4

0.5

0.7％

2

2

（Billion yen）
150

138.1

Revenue

50

10.0
0

FY20201.5
FY2021

0

100

77.8

75.3

138.2

136.3

0

101.6

（％）
6

4

2.5

200

150

100

5.0％

4.6

250

（Billion yen）
200

Record High

2.0
FY2022

Operatingincome

50

0

38.2

FY202041.2
20.2
FY2021

FY2022*The figures above have been calculated in accordance with the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Results for the two
previous fiscal years have also been revised by retroactively applying said accounting standard.

This is revenue and operating income by segment.
Retailing continues to struggle in terms of revenue, profit, and ROIC due to the still
significant impact of the spread of COVID-19 and other factors.
FinTech's revenue, operating income, and ROIC all exceeded pre-COVID levels. ROIC,
in particular, reached a record high of 5% due to an increase in non-balance sheet
revenues that we are increasingly focusing on, such as rent guarantee services.

9Factors Affecting Operating Income
E x traordi n ary
f ac tors＋¥17.8 billion
Impacts ofextraordinary loss
(Fixed cost during
stores closed)-¥6.1 billion

Provision forloss on interest
Repayment＋¥23.2 billion

Retailing

Impacts of－¥5.6 billion Gain on transfer,rent exemption
FinTechamortization¥15.2 ＋¥4.2 billion －¥0.5 billion of liquidated

billionIncrease in operating income
excluding extraordinary factors＋¥3.8 billion

Retailing -¥1.4billion
FinTech ＋¥19.2billion¥33.0
billionRetailing＋¥1.9 billion

FinTech＋¥1.8 billion

Eliminations/Corporate＋¥0.1 billion¥36.8
billionaccounts
receivable-¥3.5billion

FY2021

FY2022
10

Breakdown of changes in operating income.
Operating income increased by ¥21.6 billion in the fiscal year ended March 31, 2022,
of which ¥17.8 billion was due to extraordinary factors such as loss on interest
repayment, which was a large expense in the previous year.
Excluding these extraordinary factors, the actual increase in operating income was¥3.8 billion, with ¥1.9 billion in Retailing and ¥1.8 billion in FinTech.

Recurring revenue and Contracted future recurring gross profit■ Recurring revenue and Contracted future recurring gross profit

1.8years（Billion yen）
3000
300

Gross
profit1.2years

2000
200

185.5

337.6

Contracted future
recurring gross profit
Retailing 68.8 billon
FinTech 268.8 billion

199.1

100
1000

674 0

67.4
42%
16.3

127.6
69%

Recurring revenue

69％
FY201622.3 FY2022＊Gross profit includes selling, general and administrative expenses paid by business partners＊Rent guarantee is calculated based on remaining years of occupancy, affiliate commissions (regular payments) arebased on card expiration dates, and store rental income is based on remaining contract durations

Recurring revenue and contracted future recurring gross profit remained strong evenduring the pandemic.
As a result, contracted future recurring gross profit, which is most likely to berecorded as recurring revenue in the future, increased significantly from less than¥200 billion in the fiscal year ended March 31, 2016 to ¥337.6 billion this fiscal year,
an amount equivalent to 1.8 years of total gross profit for the current fiscal year.
We believe that this indicates that the earnings structure has changed significantly
over this period and that the certainty of future cash flow acquisition, which affects
corporate valuation, has steadily increased.

11O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
12

Next, I will explain the status of Retailing segment.

Revenue and Operating income（quarterly）
While income level rose from the third quarter of the fiscal year under review, it is still at
about one-third of pre-pandemic levels■ Revenue and Operating income trends（Billion yen）

（Billion yen）

21.4

20
13

2.5

Revenue

1.5

0.8

1Q

2Q

3Q

FY2020

4Q

1Q

2Q

3Q

FY2021

4Q

1Q

2Q

3Q

0.7

Operatingincome4Q

FY2022*The figures above have been calculated in accordance with the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Results for the two
previous fiscal years have also been revised by retroactively applying said accounting standard.

Here are the quarterly revenue and operating income trends.
They started to show increasing trend in the second half of FY2022 as the impact of
COVID-19 has weakened from the first half, but income level is still at about 30% of
the pre-COVID level.

13Trend in Number of Customers Coming to Stores (Existing Stores)
Number of customers coming to stores was 150 million. Aiming to increase this to 210 million by thefiscal year ending March 31, 2026 by increasing the ratio of non-retail tenants that attract a large
number of customers■ Numbers of customers
YoY

2.5（Million）

1.1times

YoY average

About 10% increase

210

2002

150

1.5

1001

0.5

0

FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

FY2023

FY2024FY2025

FY2026This is the status of the number of store visitors.
Although the number of store visitors for the year was 1.1 times that of the previous
year, the impact of COVID-19 still remains, especially for stores in big cities.
Going forward, we aim to increase the number of store visitors by an average of about
10% per year by promoting the transformation of the department store format set
forth in our Medium-Term Management Plan.
And by the fiscal year ending March 31, 2026, we aim to increase the number of store
visitors to 210 million, surpassing the number before pandemic.

14

Progress with Stores that Don’t Sell
Category transformation progressing with 50% of floor area now occupied by non-retail tenants.
Aiming to expand this to 70% by fiscal year ending March 31, 2026
■ Numbers of events held

■ Non-retail tenants composition

5600events

2900
Experience
focused

43%

50%

Food,
30％
services
Permanent
events

FY2021

15％

70%
70%

915

5％

FY2022

FY2026FY2021

FY2022

FY2026

The two main strategies for the transformation of the department-store model in theMedium-Term Management Plan are, shifting to "Stores that don’t sell" by expanding
the composition of non-retail stores such as food and beverage, service, andexperience-focused stores, and "Eventful stores" by launching various events
centering on anime and new businesses to make the stores more attractive and fun tovisit.
I would like to explain our progress in each of these two areas.
For “Stores that don’t sell,” the percentage of non-retail stores increased 7% yearon-year to 50% in the current fiscal year, due to the active opening of stores of CoCreative investees, and we are making steady progress toward the 70% target of theMedium-Term Management Plan.
In terms of "Eventful stores," the number of events held the year more than tripledfrom the previous year to 2,900, which is also on track to reach the mid-term goal of
5,600 events.

15

E-Commerce Transactions
Has declined for three consecutive years after peaking at ¥24.2 billion in fiscal year ended 2019
■ E-Commerce Transactions(Billion yen)

30.0
24.2

20

18.6

10

FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022

FY202616

The status of EC.
Transactions peaked at ¥24.2 billion in the fiscal year ended March 2019 and has
declined for three consecutive years, a situation that requires drastic improvement inorder to achieve the Medium-Term Management Plan target of ¥30 billion.
At the financial results presentation held in November last year, we explained that thelack of sufficient know-how and human resources for online systems was a factor in
the struggling E-commerce business, and that we would expand our human resources
for online systems and accumulate expertise in this area.

E-Commerce Transaction Volume: Year-on-Year Trends (Monthly)
Established new dedicated UI team that includes specialist personnel, transactions on a recovery
path
Newly appointed 11 UI personnel (of■ E-Commerce Transaction Volume YoY

which 3 are UI specialists)

86％

86％

1Q

2Q

120
（％）

93％

101％
4Q

3Q

108

108
100

102

98

93

90

89

81
76

71
60

APR.

MAY

JUN.

YoY

97

83
80

106

JUL.

AUG.

SEP.

OCT.

NOV.

DEC.

JAN.

FEB.

MAR.

APR.

As the first step in expanding human resources for online systems, we established a
new UI team with 11 members during the second half of the last year within the EC
Business Division, including three externally hired specialists.
The effects of these efforts are gradually being felt, and the trend in the third andfourth quarters increased, with the fourth quarter showing an increase of transactions
over the previous year.
In addition, we hired two more specialists from outside of the company this month towork on UI, and we will continue to actively expand the number of personnel for online
systems to improve UI UX.

17

O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
18

Next, let me turn to the status of FinTech.

Revenue and Operating Income
Despite a fall in gains on liquidated accounts receivable, both revenue and operating income
reached record highs■ Revenue and Operating Income（Billion yen）

140
135

50

138.1

138.2
0.9

136.3

5.1

Provisionfor baddebts
decrease

4.4

Gain ontransfer ofliquidated
accounts
receivable

-19.4

38.2

Other revenue

41.2

20.2

FY2020

FY2021

OperatingincomeFY2022*The figures above have been calculated in accordance with the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020). Results for the two
previous fiscal years have also been revised by retroactively applying said accounting standard.

Revenue and operating income of FinTech.
In the fiscal year ended March 31, 2022, despite a significant decrease ingains on liquidated accounts receivable compared to the previous fiscal year and theyear before, other revenue such as affiliate commissions grew significantly, resulting inrecord revenue and operating income, exceeding even the pre-COVID level.

19

Card Credit Transaction Volume
Efforts to maximize the share of household finances such as rent payments proved successful astransaction volume reached ¥3.1 trillion. Targeting ¥5.3 trillion for the fiscal year ending , 2026
■ Card Credit Transaction Volume

5.3（Trillion yen）
5

YoY
Difference

Change fromFY2020Billionsof yenBillionsof yenBillionsof yen

Rent

573

＋111

＋224

E-commerce

522

＋49

＋168

Regularpayments

309

＋22

＋41

Travel &entertainment

271

＋83

-71

Commercial
facilities

255

＋26

-13

Food

104

＋18

-4

4
3

2.5

2

2.6

3.1

2

1

0

FY2020

FY2021

FY2022

FY2026

Breakdown of transactions.
Rent, e-commerce, and regular payments, which are strategically expanded in theMedium-Term Management Plan to maximize share of household finances, continued
to perform well. And travel & entertainment, commercial facilities, and food arerecovering, after they struggled in the previous fiscal year.
The level is well within reach of ¥5.3 trillion planned for the fiscal year ending March
31, 2026, if the current growth rate is maintained.

20

Installment and Revolving Payments
Installment payment transactions grew by approx. 600% compared to fiscal year ended March 31,
2016 thanks to measures promoting installment payments. Total transactions for installment andrevolving payments have doubled.
■Installment and Revolving Payments transaction volume
Installment
transactions

3000（Billion yen）

165.3

2000

147.8
23.9

100
1000
500
0

292

600%

250
2500

1500

2times123.9

Revolvingtransactions
remain at
roughlysame level

FY2016126.7
FY2022The status of installment and revolving transactions.
By making it easier to use installment payments, as there was a potential need,installment transactions increased approximately 600% compared to the fiscal year
ended March 31, 2016, And exceeded revolving transactions for the first time on anannual basis.
During this period, revolving transactions did not decline. As a result, the totaltransactions of installment and revolving transactions doubled from the fiscal year
ended March 31, 2016, demonstrating that offering options that accurately meetcustomer needs has had a significant effect on revenue.

21

New Cardholders (1)New cardholder signups increased to 610,000. Promoting credit card applications throughInternet-related services and rent payments, etc. on the way to reaching one million new
cardholder signups.
■ New Cardholders

120(million)
100
1
80
60
0.6
40
20
0

Ratio of new
cardholder
applications
made atcommercial
facilities

1
0.81
0.24
0.13
0.44
20.3
FY2020

54％

0.53

0.4

0.61(＋0.08)
0.21

Online0.13

Rent,etc.

0.22

0.27

Commercial
facilities

21.3
FY202122.3
FY2022

0.19
0.12

0.2
0.4
26.3
FY202640％

Status of new cardholders.
The number of new cardholders fell sharply last year, but it increased from the year inboth online, service, and commercial facilities, and the number of new cardholders
increased by 80,000 to 610,000.
By further strengthening card applications from service use through online and rent
guarantees, we intend to expand the composition of card applications from noncommercial facilities, aiming for 1 million new cardholders in the fiscal year ending
March 31, 2026.

22

New Cardholders (2)New applications for “Cards tailored to each individual’s interests” growing steadily despite
impacts of pandemic■ New Cardholders■ “Cards tailored to each individual's interests”（million）
1
100

27％
16％

“Cards tailored to eachindividual's interests”

0.13

23％

0.5
50

17％
0.09

FY202020.3

0.27

Since Oct.2021

20,000New cardholders

0.14
0.73

0.68

0

Chiikawa EPOS Card

0.44

0.47

FY2021
21.3

FY2022
22.3

Sumikkogurashi EPOS Card
Since Jul.2019

60,000New cardholders

FY202626.3
23

In the Mid-Term Management Plan, we plan to expand "Cards tailored to eachindividual's interests" with large LTV as well as Platinum and Gold Cards.
The number of new cardholders of "Cards tailored to each individual's interests "increased by 50,000 to 140,000 in this fiscal year due to the extremely favorable
reception of the "Chiikawa EPOS Card" issued since October last year and thecontinued expansion of the "Sumikko Gurashi EPOS Card" this year, which has been
issued since 2019.
The "Cards tailored to each individual's interests" have been expanding steadily evenduring COVID-19 pandemic due to their high affinity with online card applications, as
recognition of the cards has been spreading through social media and others. We willcontinue to expand this to drive new card applications.

Cardholder Numbers
Number of cardholders as of March 31, 2022 totaled 7.14 million. Weighting of cards with highly
active users to be increased to 59%.
■ Cardholder Numbers

8.5（million）
8

7.2
7

0.3

2.5

300

FY2020
20.3

7.09
0.36

7.14

1

Cards tailored to eachindividual's interests

4

Platinum/Gold

0.45

Composition
ratio

2.7

2.93

FY2021
21.3

FY2022
22.3

47％

59％

FY2026
26.3
24

The number of cardholders increased by 50,000 to 7.14 million this fiscal year fromthe previous year.
Of this total, 3.38 million cardholders or 47% are cardholders of Platinum, Gold or"Cards tailored to each individual's interests", which have particularly high profitability.
We plan to increase this rate to approximately 60% in the fiscal year ending March 31,
2026, to further increase transactions.

Bad debt
Ratio of bad debt write-offs was at a similar level to past years at 1.8%, due to decline in bad
debt write-offs and increase in receivables at the end of period■ Trends of Ratio of bad debt write-offs

（％）

2.1
Ratio of bad debt ＊write-offs

500
400

1.8%
（-0.3）

1.9

2（Billion yen）

7500
750

300

737.5

768.8

726.9

Operating receivablesat the end of period

200
100

14

0

14.0
20.3
FY202015.3
21.3
FY2021

14.0

Bad debt write-offs

22.3
FY2022＊Ratio of bad debt write-offs = Bad debt write-offs / Operating receivables at the end of period25

Bad debt write-offs.
The bad debt write-offs exceeded 2% in the previous year due to a decrease in thebalance of loans receivable at the end of the period. Bad Debt write-offs declined by
0.3% to 1.8% this year, again below 2%, due to a decrease in write-off amount and alsoa return to an increase in the balance of loans receivable.

Interest repayment
Repayment amount and repayment claims received (a leading indicator) trending downward
recently.
■ Year-on-year trends of interest repayment amounts and repayment claims received

115
109
100

30
（Billion yen）

105

130
（%）

123

121

120

108

108

99
91

25

110

94

100

88%

20
15
1.5
10
5
0

1Q

2Q

3Q

FY2020

4Q

1Q

2Q

3Q

FY2021

4Q

1Q

90

Repayment claims
received
YoY
80
70

1.4

1.4

1.3

2Q

3Q

4Q

Interest repayment
amounts

60

FY202226

In terms of interest repayment, though we are aware that we concerned many of you
when we recorded a large amount of expenses last fiscal year, we have judged that
there is no need to make a new provision for loss on interest repayments at this time,
given the fact that the amount received, which is a leading indicator, has been
declining every quarter during this fiscal year.
We will continue to monitor the situation closely.

O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
27

Now let us turn to status of Co-Creative investment.

Co-creative investment
Cumulative co-creative investment as of March 31, 2022 stood at ¥22.3 billion. Investment during
the fiscal year ended March 31, 2022 declined sharply to ¥2.9 billion.
■ Investment in startups and funds(Billion(億円)
yen)Total amount

8
80

7.1

4.2

4
40

0

0.4

0.5

17.3
FY20173
18.3
FY201819.3
FY2019￥22.3 billion

0.9

3.3

1.5
2.7

7.2

6.3
3.8

20.3
FY202021.3
FY2021

2.9
1.9

Funds

1.0

Startups

22.3
FY2022*Includes investment from D2C&Co. Inc.

28

Co-creative investments have totaled ¥22.3 billion since the fiscal year ended March
31, 2017, but this fiscal year the amount invested was ¥2.9 billion, a significant
decrease from the previous fiscal year and the year before, mainly due to a significant
decrease in the number of interviews with startup companies in the previous fiscal
year because of COVID-19.
As the number of interviews has increased this fiscal year, we will aim to expand ourinvestment in the fiscal year ending March 31, 2023.

Profit Contributions from Co-Creative Investment
Profit contribution of ¥1.0 billion through synergies with co-creative investees. Aiming for profit
contribution of ¥5.5 billion in fiscal year ending March 31, 2026.
■ Profit contribution￥5.5 billion

60（Billion yen）
50

Fintech

40
4

4.0

30
2
20
10

0.5

1.0

15
1.5

0

21.3

22.3

26.3

- Usage of cards at co-creative
investees- Usage of cards made incollaboration with co-creative
investees

Retailing- Tenant store openings by
co-creative investees*Profit contributions included in operating income of Retailing and FinTech businesses■ IRR

FY202227％

Hurdle rate＞

10％

The earnings contributions to main business from Co-Creative investments was ¥1billion, with the Retailing business contribution of ¥0.7 billion through the opening of
tenants of Co-Creative investees, and the FinTech contribution of ¥0.3 billion throughthe use of Collaboration cards with Co-Creative investees.
The IRR was 27%. It has remained above the hurdle rate of 10% as an investment
discipline.

29

O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
30

Next, let's look at impact.

Impacts
The Company is currently carefully reviewing some targets and measurement methods, but
progress is being made with priority initiatives aimed at making positive impacts.
Theme

Creating a future
for future
generations
togetherCreating happinessfor individuals

Creating platforms
for co-creation

Priorities

FY2022

Realization of a carbon-free society

CO2 emissions reduction – 320,000t

Creation of a circular economy

Determining measurable targets withhelp from outside experts

Assistance for self-actualization

Social bonds, HERALBONY card
Young and foreign resident cardholders:
2.86 million

Support for individual preferences“Cards tailored to each individual’sinterests”: 450,000 cardholders

Provision of venues for co-creation

Store utilization with co-creative
investees: 74 projects

Facilitation of work styles that aretransparent to both internal andexternal stakeholders

Co-creation activities oriented toward future generations:Co-creative investment: 40 projects/Co-creation oriented
toward future generations: 20 projects

We have defined impact themes and priority items in our Medium-Term Management
Plan,and are currently examining the impact targets and measurement methods foreach of them.
Today, I would like to explain about CO2 reduction, social bonds, and the
HERALBONY EPOS Card.

31

Contributing to Societal Decarbonization
The Company is making steady progress with initiatives to reduce CO2 emissions. Will expand
measures to promote renewable energy use by customers■ CO2 emissions reduction volume

1,000,000 t
or more320,000 t

0t

310,000

17.3
FY201722.3
FY2022

Promotion ofrenewable energy
use by customers
Company’semissions
reduction volume
Scopes 1, 2, and 3

26.3
FY202632

First, let me talk about the impact of CO2 emission reductions toward realization of adecarbonized society.
Since joining RE100 in 2018, we have been working to reduce our own CO2 emissions
by switching 60% of the electricity we use to renewable energy and have reduced ourCO2 emissions by 310,000 tons so far.
In addition to our own emission reductions, we have started to reduce social
emissions by recommending renewable energy to our customers, working
UPDATER.inc with formerly known as Minna-Denryoku, our Co-Creative investee.
Going forward, we have a plan to step up our efforts to recommend renewable energy
to our customers so that we can achieve emissions reduction impact of more than 1
million tons in the fiscal year ending March 31, 2026.

Supporting Self-actualization of Individuals
Expand co-creation with customers and co-creative investees to support self-actualization ofindividuals
Financial inclusion

Diversity & inclusion

Social bonds

HERALBONY EPOS Card

“Supportive investment” balancing
social contribution and asset formation“Card that helps propel society forward
every time it is used”

Reached target amount within
about three hours

From November 2021: 3,000
people*0.1% of amount spent is used to support artists and welfareorganizations

33

Next, I will explain the Social Bond and HERALBONY EPOS Card issued to support
each individual's self-realization.
The Social Bond, through Co-Creation with Co-creative investees Gojo & Company
and CROWD CREDIT, was very well received as a supportive investment option thatenables EPOS Card holders to both contribute to society and build assets.
Within three hours of the start of the offering, applications for this social bondreached the planned amount of ¥100 million, and eventually ¥2 billion, 20 times theplanned amount.
HERALBONY EPOS Card is a card in which 0.1% of the amount spent on the card isused to support the creative activities of artists with intellectual disabilities and its
promotion, as well as to donate to welfare organizations through HERALBONY, our
Co-Creative investee. As this has been popular as using this card leads to social
contribution, more than 3,000 customers have applied for the card since last autumn.

O v e r v i e w o f Pe r f o r m a n ce a n d S e g m e n t I n co m e
i n F i s c a l Ye a r E n d e d M a r c h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
34

Balance Sheet and Cash Flow.

Balance sheet
Total assets came to ¥920.0 billion, up ¥18.8 billion;
operating receivables totaled ¥571.7 billion, up ¥27.0 billion
Total assets ￥901.2 billion
Current assets

Liabilities

Operatingreceivables

Interestbearing debt

￥544.7 billion￥484.6 billion

Fixed assets￥42.1 billion(＋￥18.8 billion)￥289.6 billion

Investment
securities

FY2021

Current assets

Liabilities

Operatingreceivables

Interestbearing debt

￥571.7billion(＋￥27 billion)

Net assets
Shareholder’sequityTotal assets ￥920 billion￥36 billion（-¥6.1 billion）

Fixed assets
Investment
securities￥527.2 billion(＋￥42.6 billion)

Net assets
Shareholder’s equity￥261.6 billion（-¥28 billion）

FY2022
35

First is the balance sheet.
Total assets increased by ¥18.8 billion to¥ 920 billion, mainly due to the growth of
FinTech and ¥27 billion increase in trade receivables compared to the end of theprevious year.
In addition, net assets decreased by ¥28 billion, partly due to ¥30 billion sharebuybacks for capital optimization.

Capital allocation
Allocated ¥12.1 billion for investing for growth, ¥30.0 billion for share buybacks aimed at
capital optimization, and ¥11.0 billion yen for shareholder returns in the form of dividends■ Capital allocation（FY2022）

Core operating
cash flow￥38.5 billion
Loans￥14.6 billion

Investing for
growthExisting investments￥8.5 billion
Forward-looking
investments ￥3.6 billion

Capitaloptimization

Share buybacks￥30.0 billion

Shareholder
returns

Dividends￥11.0 billion

36

Regarding capital allocation, we allocated ¥38.5 billion of basic operating cash flow.
¥12.1 billion was allocated to investment for growth, ¥11 billion to dividends, and ¥30
billion to share buybacks.
We partially used borrowings, as we accelerated the share buybacks execution to
optimize capital.

O ve r vi e w of Pe r fo r m a n ce a n d S eg m e n t I n co m e
i n Fi s ca l Yea r E n de d M a rc h 3 1 , 2 0 2 2･ Consolidated･ Retailing･ FinTech･ Co-creative investment･ Impact･ Balance sheet and cash flow

Full-Year Forecast for Fiscal YearEnding March 31, 2023
37

Next is the forecast for the fiscal year ending March 2023.

Full-Year Forecast for FY2023
・Forecasting 11% increase in operating income year on year to ¥41.0billion and 21% increase in net income to ¥21.5 billion
FY2022

FY2023

YOY
changeYOY
difference

EPS

(yen)

85.8

109.1

127

+23.3

ROE

(％)

6.5

8.4

-

+1.9

ROIC (％)

3.3

3.5

-

+0.2

Reduc ti on of CO2(ten thousand tons)

32

34

106

+2

B i lli o n s o f y e n

B i lli o n s o f y e n％

B i lli o n s o f
yen3373.43910.0116+536.6

Revenue

209.3

222.0

106

+12.7

Gross Profi t

181.1

194.0

107

+12.9

SG&A expenses＜ Referenc e ＞

Total Grouptransac ti ons

144.3

153.0

106

+8.7

Operating income

36.8

41.0

111

+4.2

Net income

17.8

21.5

121

+3.7

Total transactions, up 16%, operating income up 11%, and net income up 21%. We
expect strong growth in profits.
EPS, ROE, and ROIC are expected to grow significantly.
An increase in EPS by 27% to 109.1yen, ROE up 1.9 points to 8.4 %, and ROIC up 0.2
points to 3.5 %.
By recommending renewable energy to our customers, we plan to reduce 340,000
tons of CO2 emissions, which is 20,000 tons more than last fiscal year.

38

Segment Income Forecasts for Fiscal Year Ending March 31, 2023
Forecasting 78% year-on-year increase in Retailing segment to ¥3.5 billion and
7% year-on-year increase in FinTech segment to ¥44.0 billion

FY2022

FY2023
YOY change

YOY difference

B i lli o n s o f y e n

B i lli o n s o f y e n％

B i lli o n s o f y e n

Retai li ng

2.0

3.5

178

+1.5

Fi nTec h

41.2

44.0

107

+28.0

Eli mi nati ons/Corporate

-6.4

-6.5

-

-0.1

Consoli dated

36.8

41.0

111

+4.2

39

Next is the operating income forecast by segment.
An increase in Retailing by 78% to 3.5 billion yen is expected, even though the impact
of COVID-19 remains.
FinTech will return to the pre-COVID growth phase, up 7% to 44 billion yen which is a
new record high.

Planned Dividends
Annual dividend of ¥52 per share is planned for fiscal year ended March 31, 2022. Planning ¥58 pershare for fiscal year ending March 31, 2023, making it the 11th consecutive year of dividend increases.
■ Trend of dividend per share
60
（yen）

40

20

0

33

14

FY201215FY201318

19

FY2014FY2015

49

50

51

52

FY2019FY2020

FY2021

FY202258

38

22

FY2016FY2017FY2018FY202340

Now about the Dividend.
Our basic policy is a long-term, continuous increase in dividends.
The dividend per share for the fiscal year ended March 2022 is 52 yen, a rise of 1 yenfrom the previous year. For the year ending March 2023, we plan to raise by 6 yen to
58 yen, 11 consecutive years of increase.

That is all from me. Thank you very much.

2
Human-Capital-Focused Management
Hiroshi Aoi,
P r e s i d e n t a n d R e p r e s e n tat i v e D i r e c to r,
R e p r e s e n tat i v e Exe c u t i v e O f f i ce r,
CEO

I am Aoi.
I’d like to explain the human capital management of MARUI GROUP.

Corporate Philosophy : Equate the development of our people withthe development of our company
Uniting corporate culture with the development of our people to raise corporate value based on
our corporate philosophy

Corporate value
Development ofour people

Human capital

Corporate
cultureCorporatephilosophy
42

Using the Iceberg Model, human capital is the “invisible capital” under the water
which is the source of the visible corporate value represented by financial information.
Based on our corporate philosophy of "Equate the development of our people withthe development of our company," we aim to enhance our corporate value bychanging the corporate culture and developing our people.
While shareholders and investors are increasingly interested in human capital, we have
not had an opportunity to explain it fully, so I’d like to share with you the overview
today.
Since I became President in 2005, we’ve been working to transform our corporate
culture for 17 years.
Transforming a corporate culture requires a long-term commitment, but through our
tenacious effort, now people say that MARUI GROUP is completely different from thepast.

Corporate Culture Reforms (Updating Our “Operating System”)
Update our “operating system” to move away from focus on earnings performance and restore
relationships of trust within the Group

Application

Sustainability

Old corporate culture

Well-beingOS

New corporate culture

43

Corporate culture is like an Operating System for management.
By upgrading our OS from the old one, we are shifting to new management thatbalances sustainability and well-being with profitability.

Corporate Culture that We Aspire toContrasting corporate culture

Corporate culture that
we aspire toCompulsion

Autonomy

Obligation

Enjoyment

Top-down commands

SupportCore business + social
contribution

Contribution to solvingsocial issues through corebusiness

Earnings performanceenhancement

Value enhancement

44

We are aiming to create a corporate culture to shift from forcing people to respecting
their autonomy, from obligation to enjoyment, from top-down commands to support,
from core business and social contribution to contribution to solving social issues
through core business, from earnings performance enhancement to valueenhancement.

MARUI GROUP’s Corporate Culture
Advance a variety of measures simultaneously on the way to reforming corporate culture

1 Corporate philosophy
2 A culture of Interaction
3 Work style reforms
4 Embracing diversity
5 A culture of voluntary participation
6 Personnel transfers within Group to different job
categories
7 Appraisal based on both performance and value
8 Well-being45

A variety of measures were taken simultaneously to change our corporate culture.
I will explain each of the measures 1 through 8.

1 Corporate Philosophy“Continue evolving to better aid our customers”“Equate the development of our people
with the development of our company”

46

First of all, we set our corporate philosophy shown on this slide.
“Equate the development of our people with the development of our company”.
This is the basis of our human capital management.

Interaction about Corporate Philosophy

More than 4,500 employees have taken part in interaction over the course of more than a decade“What are am I actually working for?”“What did I want to accomplish by joining MARUI?”47

We had a thorough interaction with our people about our management philosophy.
In the dialogue, employees had deep level discussions on essential topics such as:“What are am I actually working for?”“What did I want to accomplish by joining MARUI?”I think those dialogues were the act of aligning the company’s purpose with individual
purpose.
The dialogue session continued for more than 10 years joined by almost all employees.

Foundation for Building Relationship as Equals
As a result of adjusting our corporate philosophy, employee turnover increased at one stage,
but has since trended down as acceptance grew
■ Employee turnover rate (excludes mandatory retirees)■ Employee turnover rate
(in first three years after joining as fresh graduates from university)

（%）

（%）

14

13%

31% Averagelevel inJapan*

30

12
10

20%

8

11%

15

6

MARUI GROUP

3%

4
2
0

FY2006
6.3

FY201010.3

FY201414.3

FY201818.3

FY2022
22.3

0

7

9

11

13

15

17

Year of joining company

19 as fresh graduate fromuniversity

Estimated by MARUI GROUP based on Ministry of Health, Labour and Welfare data on employee
turnover rate trends within three years of joining companies as fresh graduates from university

After aligning the philosophy, people who were unable to share the common ideal left
resulting in a temporary rise in the turnover rate.
However, as we were able to enhance the circle of empathy for the philosophy, theturnover rate is now at a low level, around 3%.
For the new employees, we share our corporate philosophy before they join us
through programs such as internships. That resulted in an improvement in turnoverrate for new employees up to ３years from 20% to 11%, which is one-third of thenation’s average of about 30%.
This is how we built the foundation for the company and the individual relationshipwhere we mutually select each other.

48

2 A Culture of Interaction
Transform corporate culture so that all meetings involve two-way interaction rather than oneway communication
The rules of Interaction
1 Begin with “safe space” declaration
2 Do not set specific purpose
3 Do not demand a conclusion
4 Listen attentively
5 Speak in response to what someone
else says
6 Do not dismiss a person’s opinion
7 Let ideas mature by having intervals
between meetings
49

In addition, “A culture of interaction" has been fostered through these activities.
In the past, one-way communication was the norm, so it was a challenge tounderstand what interaction was, but through trial and error, we learned how toengage in interaction.
And we created rules for " interaction ".
All of them are obvious, but (1) " Begin with safe space declaration" is similar to
Google's psychological safety, and they are similar to David Bohm's theory ofinteraction.
Thanks to this, the habit of interaction is now firmly established, and meetings arealways conducted with interaction.

3 Work Style Reforms
Switch to corporate culture that sharply reduces monthly overtime hours per person and that isbased on the idea that the creation of value is the essence of work
■ Monthly overtime hours per person
12（hour）■ Approach to work

11hours

10
8

4.5
hours

6

BeforeNow

Providing Time

Providing Value

4
2
0

08.3
FY200822.3
FY202250

Next, we worked to reduce overtime as part of our work style reforms.
As a result of initiatives, per capita overtime was reduced from 11 hours per month in
the fiscal year ended March 2008 to about 4 hours in the fiscal year ended March2022.
The purpose of this initiative is not only to create a comfortable workplace but also totransform our perspective on work - what is important for the future is to create"value" and not to work long hours.

4 Embracing Diversity
Organizational reform has been ongoing since 2014, with focus on diversity in three areas of“gender”, “age groups”, and “individuals.”

GenderPromote exploration of diverse work styles and participation by women indecision-making

AgegroupsEnable participation of all age groups, from young to older employees

Individuals

Encourage individual growth and development through the gaining of diverse
work experience51

In embracing diversity, we addressed three types of diversity: "gender," "age groups,"
and "individuals" .

Promoting Diversity: Gender diversity
Promote participation of women in decision-making and launch more in-depth initiatives■ Women’s Empowerment Indexes (excerpt)New■ External assessment
FY2014FY2022

FY2026

Ratio of female leaders

20

32

40

Ratio of female employees pursuing
upper-level positions

41

64

75

Ratio of applicable male employees
taking childcare leave

14

100

100

Ratio of applicable male employees taking
childcare leave within eight weeks ofchildbirth by partner

―

51

80

Percentage of employees who aresympathetic to revising traditional genderroles (men work, women look after home andchildren)

―

48

50

Men’s share of housework and childcare

―

35

35

Nadeshiko Brand(selected five years running)（％）

I’d like to explain "gender" diversity.
From the Fiscal year ended March 2014, we started a project to promote women’s
empowerment.
By setting our own KPIs, Women’s Empowerment Indexes, 8 years later, in the Fiscal
year ended March 2022,100% of male employees had taken child care leave for ４
consecutive years, and the percentage of female employees pursuing upper-level
positions, which had been an issue, had also improved to 64%.
From the fiscal year March, 2022, we have set a new goal for male employees to takepaternity leave, and have begun addressing the gender roles between men and women,
which is the cornerstone of gender equality.
In recognition of these efforts, we have been selected as a "NADESHIKO BRAND"
for five consecutive years.

52

5 A culture of voluntary participation :Medium-Term Management Visionary Committee in 200853

Next is the culture of voluntary participation.
What triggered this idea was the Medium-Term Management Visionary Committee
when I became president.
As you can see, all the participants were men in dark suits.
Some of them were sleeping.
After thinking about how to revitalize such meetings, I arrived at the " voluntary
participation " method.
We decided to ask people to volunteer if they want to participate in such meetings,
and invited only them.

A culture of voluntary participation :Medium-Term Management Visionary Committee Today＊Includes images of meetings before the COVID-19 pandemic54

And here is the current situation.
The participation of women as well as men, young as well as experienced, has createda lively atmosphere and improved the meeting to a different degree

A culture of voluntary participation :Medium-Term Management Visionary Committee
Applications open once a month, and 300 applicants are selected from 1,000 applicants after
an assessment of essays submitted.
Application

Selection

Participation

Applicants submit essays anonymously

Each essay is assessed by apanel of two or three people

Dialogue with speakers

Approx. 1000

■Number of
meetings held

Approx. 300

78■ Cumulative number ofparticipants

25,000Total for 2015–2022

55

The Medium-Term Management Visionary Committee is held once a month, 12 times
a year.
Nearly 1,000 people raise their hands each time, and about 300 who have passed thepaper screening participate in the conference.
To date, we did 78 meetings and 25,000 people attended.

A culture of voluntary participation
To inspire innovation, build an voluntary organization by encouraging each employee to be independent■ Initiatives facilitating voluntary participation■ Percentage of employees voluntary
participating

Interaction on corporate philosophy
Official Groupwide projectand initiatives
Personnel transfers within Groupto different job categories
Program enabling employees to attend
external business schools
Medium-Term Management Visionary
Committee
Future Leader
Development Program

2008

2010

2012

2014

2016

2018

2020

82％
FY20222022

56

We started to adopt this raise hand system for other programs such as projects, going
to external business schools, future leader development programs, and new
businesses.
In addition, promotion exams and transfers are also conducted on a voluntary
participation.
In the fiscal year ended March 2022, the percentage of employees who voluntarily
participated reached 82%.

6 Personnel Transfers Within Group to Different Job Categories
Help individual employees to grow by experiencing work at different Group companies and departments■ Personnel transfer image

Retailing■ Percentage of employees who change
job categories

77％77

FinTech％＊As of March 2022

IT

Housing

MARUI GROUP

Corporate
venturecapital

Logistics■ Percentage of employees who felt they
had achieved personal growth after transfer

86％

Securities＊ Based on questionnaire carried out in November 201657

Next is our unique "Personnel Transfers Within Group to Different Job Categories".
In addition to Retailing and FinTech, MARUI GROUP has a variety of other businesses,
like IT, logistics, and housing.
Based on employees’ wishes, we’re offering " Personnel Transfers Within Group to
Different Job Categories " across our group.
In the fiscal year ended March 2022, a cumulative total of 77% of employees weretransferred to jobs different from their original ones.
86% of the employees experienced growth after their transfer.
We aim to promote the growth of employees and to form a team consisting ofindividuals with diverse experience, thereby enhancing our ability to respond tochange and become a company capable of creating innovation.

7 Appraisal Based on Both Performance and Value
Promote corporate philosophy of appraisal based on both performance and value, whichmeans appraisal is not only based on performance, but also on personal growth anddevelopment
Performance appraisal

ResultShort-term appraisal: Bonuses

ActionSkillsKnowledge

Putting corporate philosophy
into practice

Value appraisal
Medium- to long-term appraisal:
Promotions
58

To support these initiatives, we revised our personnel evaluation system.
It is appraisal based on both Performance and Value .
By doing both performance evaluations and 360-degree evaluations from supervisors,colleagues, and subordinates about values, we aim to realize our philosophy of“personal growth”.

8 Well-Being

Definition of health in World Health Organization’s charter *“Health is a state of complete physical, mental, and social well-being
and not merely the absence of disease or infirmity.”■ Resilience program for executives■ Well-being promotion project
Since 2016, 40–50* Source: WHO■ Selected by METI as Health andProductivity Management
Organization for five years runningparticipants per year

Up to five times
more applicants
than places
59

The last is “well-being”.
We’ve been working on well-being since 2016, aiming to create a vibrant organization
where each employee is able to work with a sense of fulfillment and vitality.
Led by Ms. Kojima, our industrial physician, and Chief Wellbeing Officer, we have
implemented a resilience program for executives, as well as projects lead by
employees.
Project members were selected from applicants five times as many as the members,
who are passionately leading their workplace.
In recognition of these efforts, the company has been selected as a "Health &Productivity Management Organization" for five consecutive years.

Investment: Investment in R&D and Human Resources So Far
Invested ¥11.0 billion in total over period covered by previous medium-term plan; increased
investment to ¥4.2 billion in FY2022（billion yen）

￥4.2 billion

11.0billion

Total amount ￥

4
40

3.4

1.0

3
30

Investment in human resources
・Personnel expenses in business
units responsible for humanresources development

・Education and training expenses

3.2

20

R&D expenditure
・Expenses

1
100・Personnel expenses(Anime department, co-creation teams, R&D Center, etc.)

0.6
FY2017FY2018FY2019FY2020

FY2021

FY202260

Next is about investment.
During the previous medium-term management plan, we invested about 11 billion yen
in "human resources" and "R&D" combined.
The total investment for the fiscal year ended March, 2022 was 4.2 billion yen.
However, some of the investments that were categorized as R&D included things
related to human capital.

Investment: Redefining Human Capital Investment
Redefine items in income statement of each fiscal year connected with increasing corporate value in the longer
term as “human capital investment”■ Breakdown of human capital investment in FY2022
・First year after job

STEP 3category change
Additional・okos Co., Ltd.
investment

STEP 2¥4.5
billion・Personnel expenses in new
businesses

R&D
・Co-creation team personnel expenses
expenditure ・Seconded personnel expenses¥2.2
billion

STEP 1

・Education and training expenses
・Medium-Term Management Visionary Committee ,HR investment participation in projects and initiatives

Human capital
investment¥7.7
billion¥1.0
billion61

We have therefore decided to redefine human capital investment by extracting humancapital-related expenses.
Previously, we recorded only the education and training expenses under human capital
investments, which was about 1 billion yen for the fiscal year ended March, 2022.
We now add personnel costs for employees involved in new businesses and seconded
staff, half of the co-creation team’s cost, which was previously included in R&D.
The amount is about 2.2 billion yen.
We’ll also add costs for the first year of employees who have changed their job
category and the investment in a new business incubation company.
These are about 4.5 billion yen.
The total amount is 7.7 billion yen.

Investment: Human Capital Investment as Share of Personnel Expenses
Increase human capital investment that contributes to future earnings to ¥12.0 billion and 35%
of personnel expenses

35％
180"00Share of personnel

140"003530

expenses

160"00

40
（%）

22

￥12.0
billion（billion yen）
120"00100"00
10

25
20
15
10

￥7.7billion
80"00

5
0

60"00
6
40"00
20"00
0

22.3
FY202223.3
FY202324.3
FY202425.3
FY202526.3
FY2026

Under the new medium-term management plan, human capital investment based on
the new standards will expand to 12 billion yen in the fiscal year ending March, 2026.
Accordingly, the investment as a percentage share of personnel expenses will risefrom 22% to 35 %.
Through this expansion of human capital investment, which contributes to future
earnings, we aim to sustainably increase corporate value.

62

Evolve into Knowledge-Creation Company

From in1931(Establishment)

From 2006

From 2019

Labor-intensive

Capital-intensive

Knowledge-creation

Business model

Retailing-driven

FinTech-driven

Retailing + FinTech + Forwardlooking investments

AssetsFixed Assets

Financial assets

Intangible assets

Investment

Tangibleinvestments

Intangible investments

63This is the future Direction.
We have transformed ourselves from a Retailing-driven, labor-intensive business to a
FinTech-driven business.
Going forward, we will evolve into knowledge-creation business through businessmodel integrating Retailing, FinTech, and Forward-Looking Investments, and byinvesting in intangible assets.

Challenges on the Way to Evolving into a Knowledge-Creation Company
Gap exists between group’s desired direction and nature of current workforce

Labor-intensive/capitalintensive

Knowledge creation

Current human resources

Required human resources

Operations

Gap

Efficiency

Production
Creativity

64

What we need for further evolution is to bridge the gap between current humanresources and the people we want for the future.
Until now, we were seeking people who can efficiently carry out the given tasks.
In the future, we want people who are production creativity new businesses.

Required Human Resources: “Digital Business Creation Personnel”“Digital Business Creation Personnel” are personnel able to harness the power of digital tools tocreate new businesses■Attributes of digital business creator personnelInterested

Organizational
capabilities + ability
to take action

Hypothesisdriven
thinkers

Agile development skills utilizing
digital tools

Ability to become absorbed in theirwork and enjoy it

Goaloriented

Envisions future goals andbackcasts from these

Adept with digital
tools

65

A key phrase for the human resource we want is “Digital Business Creation
Personnel”.
A person capable of producing new business by utilizing the power of digital.
This capability requires “like” as a starting point, with a combination of hypotheticalthinking, target-oriented, and digital.

Future Initiatives: Expanding Personal Growth Opportunities
Expand personal growth opportunities through new businesses, co-creation teams, andFuture Leader Development Program■ Co-creation teams■ New businesses

Deploy new initiatives, including incubationcompany okos Co., Ltd.

400
（people）

347

300

Promote co-creation with startups byteams led by executive officers

250（people）

201(22teams）

200

■CMA

＊

Next-generation management training
program to produce future MARUI GROUP
management team members
250（people）

200

200

150

150

100

100

50

50

200

100

0

FY201616.3

FY201919.3

FY2022
22.3

0

20.7

21.3
FY202122.3
FY2022078

18.3
FY201822.3
FY202227.3
FY2027＊Co-creation Management Academy

66

In order to develop such talents, we will further provide growth opportunities such as
new businesses, co-creation teams, and CMA, our next-generation management
development program.
Through CMA, we plan to train about 200 next-generation candidates by fiscal year
ending March, 2027.

Future Initiatives: Digital Transformation Training
Identify and train personnel capable of harnessing digital tools to create new businesses withco-creation partners■ Digital transformation training
Initially train directors, then expand+

program to train new recruits andexisting employees

Director training
New recruit training
Existing employee
training

AppKoshien(in-house)＊ Digital transformation training for directors

21.12

22.4

22.12
67

In addition, we’ll also strengthen our digital training.
In collaboration with Life is Tech!, our co-creative investee, we conducted digitaltraining for directors last December.
This fiscal year, we’ll first conduct training for new employees, followed by existing
employees.
Furthermore, we’ll hold an in-house event called "App Koshien" in December tocompete for the best results from the training and to discover digital talent.

Future Initiatives: Established “Muture”
Established “Muture”, a joint venture with leading UX design company Goodpatch Inc., toadvance Group’s digital transformation

Goodpatch Inc.
Established

September 2011

Representative

Naofumi Tsuchiya, CEO/Founder

MarketMuture Corporation+

TSE Growth（Listed on TSE Mothers in 2020)

Business

UI/UX, business model design,
software development
Hiring of human resources with advanced
digital skills
Training of in-house UX specialists throughsecondment
68

In April, we established a joint venture company, “Muture” with Goodpatch, a leading
UX design company.
This joint venture will serve as a window for recruiting digital and UX experts.
We’ll also enhance UX expertise through secondment.

Governance: Established New HR Strategy Committee
New committee established as an advisory body, working with Strategy Committee and outside experts topropose HR strategies to board of directors

HR Strategy Committee

Strategy Committee

NEW・Make recommendations on required
human resources and HR portfolio
・Make recommendations on hiring/training
plans and HR system

Chair

MemberTomoo Ishii

Etsuko Okajima(CHRO）(External Director)

・Tasked with examining
medium-to-long-termbusiness strategies

Collaborate

Chair

Yasunori Nakagami(External Director)

69

Next is governance.
In order to align management strategy and human resource strategy, the Human
Resource Strategy Committee was newly established in April as an advisory body to
the Board of Directors.
The committee will be chaired by CHRO Mr. Ishii, and outside director Ms. Okajima willserve as a member of the committee.
The committee will propose HR strategies to the Board of Directors in cooperation
with the Strategy Committee.

Issuance of Shares to Employees
Issue shares to employees to further promote “Management emphasizing Stakeholders” andincrease corporate value

Performance-linked stock compensation for directors and executives＋
Issue shares to general employees

Promote “Management emphasizing Stakeholders”
Consider issuing a total of 500,000–1,000,000 shares to employees, providing each employeewith at least enough shares to be eligible to exercise shareholder voting rights

Considering holding employee shareholders’ meetings(In addition to general shareholders’ meetings held in accordance with the Companies Act)

Last is about the resolution passed today by the Board of Directors regarding grantingof shares to employees.
We have a performance-linked stock compensation program for directors andmanagers, but this time we will also grant shares to general employees.
By having employees become shareholders, we will take our stakeholder management
one step further. We are considering granting each employee more than one unit,
totaling between 500,000 and 1,000,000 shares.
Based on this, we will consider holding a general meeting of shareholders for
employees, in addition to the annual general shareholders’ meetings under theCompanies Act.

70

The forward-looking statements contained in this presentation are based on information available at the time of
preparation of this presentation and certain assumptions that MARUI GROUP deems to be reasonable. The
forward-looking statements may differ materially from actual results due to a variety of different factors. Please
direct any inquiries to the IR Department (marui-ir@0101.co.jp ).

That’s all from me.
Thank you very much for your attention.