LIFE CORPORATION

April 11, 2024

LIFE CORPORATION
Financial Results Briefing
For FY2023(Fiscal year ended February 29, 2024)

LIFE CORPORATION

Key points for full-year FY2023 earnings[Higher Sales and Profit](1) Operating revenue reached a record high of¥809.7 billion(2) Gross profit ratio +0.3P, SG&A ratio controlled(3) Ordinary profit reached ¥24.9 billion, the second
highest since FY2020 during the COVID-19
pandemic

Successful start
for the first year of the 7th Medium-Term Plan
―2―

LIFE CORPORATION

1. Performance overview
2. Full-year FY2023 initiatives
3. Progress of the 7th MediumTerm Plan
4. Topics
5. Full-year forecast for FY2024―3―

LIFE CORPORATION

1. Performance overview―4―

LIFE CORPORATION

Performance overview (consolidated)(Unit: Millions of yen, %)Amount of
ChangeRate of
ChangeFull-year FY2022

Full-year FY2023

Operatingrevenue

765,426

809,709+44,283+5.8

Net sales

738,494780,028+41,533+5.6

Operatingprofit19,14824,118+4,969+26.0

Ordinary profit

20,01524,948+4,933+24.6

Profit13,327

16,938+3,611+27.1―5―

LIFE CORPORATION

Operating revenue trends (full year)• Record-high operating revenue, which in real terms achieved an increase
for the 20th consecutive year
New stores (10 stores) and growth of existing stores (YoY net sales 102.9%)
contributed to this
(Unit: store)(Unit: Billions of yen)

800.0

Operating revenue

Number of stores at end of the fiscal year
759.1

629.9

264

305

300

296

290
280

280

698.6
652.9

768.3

310

285

714.6

700.0

765.4
(785.6) *

809.7

275

677.7

270

270
266

260

256

250
240

600.0
15

16

17

18

19

20

21

22

* Application of “Accounting Standard for Revenue Recognition” from FY2022 (operating revenue before application: ¥785.6 billion)―6―

23(Fiscal year)

LIFE CORPORATION

Sales-related indicators for existing stores• Although price increases due to rising procurement costs are stabilizing, unit
prices remained high mainly due to growth in value-added products• The number of customers increased due to the appeal of the affordable
prices, and there is also an upward trend in the number of purchases
Number ofcustomers YoY

100.6%Net sales YoY

Number ofpurchases YoY

102.9%
Sales percustomer YoY

97.0%

102.3%
Unit price YoY

105.4%―7―

LIFE CORPORATIONNet sales/gross profit ratio (by department)•

Sales were driven by departments such as the Process and Daily, Agricultural Produce, andDelicatessen. Price settings that are conscious of quality and price balance and the growth ofvalue-added products, etc. resulted in gross profit ratio +0.3P
Net sales(Unit: Millions of yen, %)Full-year FY2023
Department
Food

All storesvs. FY2022

Gross profit ratio(Unit: %, P)

Full-year FY2023

Existing
stores
vs. FY2022

Gross profit
ratio

Difference fromFY2022689,244

105.9

103.0

31.6

+0.4

Agricultural
Produce

100,634

105.8

103.0

29.8

+0.1

MarineProducts

60,628

104.7

101.6

32.7

+1.2

Meat Products

87,057

103.3

100.4

30.5

(0.1)

Delicatessen

91,251

106.2

102.9

54.7

+0.2

Process andDaily

349,672

106.7

104.1

26.2

+0.5

Lifestyle Products

67,630

104.6

102.4

26.6

(0.1)

Apparel

23,153

100.7

99.2

38.4

(1.3)

780,028

105.6

102.9

31.4

+0.3

Total

―8―

LIFE CORPORATION

SG&A [Net sales/SG&A ratio]•

Although improved compensation, an increase in new hires, and higher hourly
wages for attracting skilled personnel led to higher personnel expenses, a reduction inpromotional expenses helped control the SG&A ratio. Electricity rates were ¥10.7
billion (YoY 98.6%), remaining high at approximately 140% compared to FY2019(Unit: Millions of yen)

300,000(Unit: %)Depreciation

250,000
211,885

200,000
150,000
100,000
50,00012,715

101,740

Non-personnel expenses

221,075
13,110103,888

30.6

30.0

97,430104,076

Personnel expenses

231,046
14,06150.0

Net sales/SG&A ratio

237,365
14,966250,306
15,92145.0
40.0

107,405

31.0
109,579

109,296

112,804

35.0
32.1

32.1

113,102

121,580

0

30.0
25.0
20.0

19

20

21
―9―

22

23

(Fiscal year)

LIFE CORPORATION

Factors of changes in operating profit (full year)(Unit: Millions of yen)
Increase in operating gross profit

Increase in SG&A

+17,909(12,940)

Increase in receipts Decrease infrom operating
utilities
revenue
expenses

Increase ingross profit+15,160+2,749+279
Increase in
rent
expenses(1,247)
Increase inpersonnel
expenses

Increase indepreciation(8,478)19,148(954)

24,118
Increase inothers(2,539)

Increase in operating profit +4,969

Full-year FY2022

Full-year FY2023― 10 ―

LIFE CORPORATION

Consolidated balance sheet(Unit: Millions of yen)
End-February, 2023

End-February, 2024

Change80,49082,849+2,358Cash and deposits

9,727

8,606

(1,121)Inventories

26,061

28,173+2,111

Accounts receivable - trade

9,209

9,560

+350

Accounts receivable - other

29,66432,072+2,407

Others

5,826

4,436

(1,390)200,319+3,977

155,880

204,297
156,315

Intangible assets

3,218

5,484

+2,266

Investments and other assets

41,22042,497+1,276

Total assets

280,810287,146+6,335

158,807150,290(8,517)

74,17053,094(21,075)

122,002

136,855+14,852

280,810287,146+6,335

Total current assets

Total non-current assets
Property, plant and equipment

Total liabilities
Interest-bearing liabilities
Total net assets
Total liabilities and net assets― 11 ―+435

LIFE CORPORATION

Consolidated cash flow
• Cash flows from operating activities increased and repayments of interestbearing liabilities resulted in a significant decrease in cash flows fromfinancing activities(Unit: Millions of yen)
Full-year FY2022

Full-year FY2023

ChangeCash flows fromoperating activities

23,89941,700+17,800

Cash flows frominvesting activities(23,839)(17,357)+6,481

Cash flows fromfinancing activities(142)(25,464)(25,321)

９,327

8,206

(1,121)

Cash and cash
equivalents at the endof the period― 12 ―

LIFE CORPORATION

2. Full-year FY2023 initiatives― 13 ―

LIFE CORPORATIONStore development (new stores)• New stores opened as planned: 10 stores (H2: 4 stores)• Total stores in Tokyo and Osaka regions: 305 stores• Expanding the utilization of process centers and satellite delicatessen
centers accelerated store openings in small spaces
Process centers
Satellite delicatessen
centers

H2: new stores (sales floor area)

Product supply― 14 ―

Sakuranomiya Store(1,101 ㎡)

Kachidoki Mid Store(792 ㎡)

Shimomeguro Store(632 ㎡)

Hanshin Ashiya Store(999 ㎡)

LIFE CORPORATIONStore development (renovation of existing stores)• Renovation of existing stores: 9 stores (H2: 7 stores)• Strengthened sales capabilities of existing stores by responding to local
needs and introducing unique products, etc.
[Renovations in H2]

September Higashinakano Store

October Konohanadempo Store

February Sekime Store[Examples ofrenovation][Responding to local needs]

Expanding frozen food corner

November Kumata Store

February Kinshicho Ekimae Store

February Ishizu Store[Introducing unique products] [Enhancing non-food products]

Setting up “Uo sushi” corner

February Kasuganomichi Store[Improving productivity]

Introducing famous brand clothing Introducing smartphone and cart POS― 15 ―

LIFE CORPORATIONStore development (renovation of existing stores)• Since sales growth is expected for stores that have been renovated, we
will actively continue renovations■ Comparison before and after renovation (comparison of YoY sales between renovatedstores and existing stores)(Unit: %)[Store B (renovated in FY2023)][Store A (renovated in FY2022)](Unit: %)

110.0

110.0

105.0

100.0

95.0

90.0

105.0

100.0

Store A YoY sales

95.0

Existing store YoY sales-4 months -3 months -2 months -1 month 0 months +1 month +2 months +3 months +4 months +5 months +6 months

90.0― 16 ―

Renovation (including the
preparation period)

115.0

Renovation (including the
preparation period)

115.0Store B YoY sales
Existing store YoY sales-4 months -3 months -2 months -1 month 0 months +1 month +2 months +3 months +4 months +5 months +6 months

LIFE CORPORATION

Product strategy (unique products and new collaborations)• Strengthen the development of BIO-RAL PB products in response tocustomer needs• Undertake new initiatives with SEIJO ISHII to support efforts to create a
new food culture
Strengthen development of BIO-RAL
PB products

Procurement of products
through new collaborations[Sararito Uruou (Non-Greasy& Moisturizing) Hand Cream]• We are also enhancing nonfood PB products• Hand cream that is madewith 100% naturalingredients and gentle to theskin• Biomass tubes are used
[Muenseki Momo Ham
Kiriotoshi (Uncured Pork Leg
Ham Trimmings)]• No food coloring• Real taste of meat that
overturns the image ofan uncured product• Lit To Nouveau = new wine that lights up (“Lit”) the winter(“To” in Japanese)
This is a new wine that brightens up a customer’s table,from the end of autumn to the arrival of winter― 17 ―

LIFE CORPORATION

Products strategy (affordable price of products, promoting
bulk purchases)• Implement a project to improve recognition of the affordably priced private
brand “star select”• Strengthen bundle sales (mixed-selection sales) to promote bulk purchases■ Strengthen bundle sales(mixed-selection sales)■ Improve recognition of PB products

Project to improverecognition of star select

Increased exposure
within the store― 18 ―

Bundle sales atmultiple price ranges

LIFE CORPORATION

Product strategy (PB products)• Sales of BIO-RAL PB products have approximately quadrupled over the
past four years thanks to product development that meets customer needs,
the expansion of BIO-RAL section, etc.
■ Growth by private brand (from FY2019 to FY2023)¥39,020 million→ ¥48,303 million¥7,136 million→ ¥7,755 million¥1,684 million*→ ¥7,035 million¥10,588 million→ ¥11,745 million

123%

108%

417%

110%

* Life Natural brand sales■ PB product FY2023 results
Private brand name

Net sales(Unit: Millions of yen)

YoY (%)

Sales composition(%)

Number of items

Smile Life

48,303

108.6

6.2

794

LIFE PREMIUM

7,755

102.7

1.0

153

BIO-RAL

7,035

135.6

0.9

358

star select

11,745

108.8

1.5

211

Total

74,838

110.0

9.6

1,514

― 19 ―

LIFE CORPORATION

Productivity improvement initiatives (electronic
shelf labels)[Installation progress]• Tokyo Region: completed at all stores• Osaka Region: completed at 34 stores, planned to beinstalled at all stores going forward[Effects]• Reduces task for changing POP(Example) Store C: reduction by at least
200 hours per month• LED light assists with expiry datemanagement and stocking• We will promote secondary use through linkage with various
systems going forward― 20 ―

LIFE CORPORATION

Productivity improvement initiatives (AI ordering)[Installation progress]• FY2020: used in the Food Department (daily food) of all stores• April 2024: scheduled to be operational in all stores for theFresh Produce Departments
Forecast period will be expanded from five days to three
weeks to accommodate advance procurement necessary forprocessing[Effects]• Bringing orders by less experienced employees up to
Marine Products
standard levels
Department• Contribute to stable production at
Agricultural Produce
Department
process centers in the future
Meat Products
Department― 21 ―

LIFE CORPORATION

Online supermarkets• Delivery area expansion and growth of existing stores resulted in sales of¥20.0 billion (YoY approximately 140%)• Business profit was in line with the target profit thanks to productivity
improvement and cost optimization■ Online supermarket net sales trends

20.0(Unit: Billions of yen)

20.0

•

14.2

15.0

•

9.6

10.0

5.0

■ Initiatives

5.3
3.1

•
•
•

0.0
19

20

21

22

23

(Fiscal year)― 22 ―[Growth in net sales]
Increased delivery areas→ Our online supermarket delivery
areas cover over 80% of areas
covered by existing stores
Enhancement of product lineup→ Approximately 15,000 items available[Productivity improvement and cost
optimization]
More efficient picking work
More organized delivery systems
Further improvements planned for
FY2024

LIFE CORPORATION

3. Progress of the 7th Medium-Term Plan

― 23 ―

LIFE CORPORATION

Investment in employees (employee training)• Enhance education targeting the next generation• Further enhance education to deepen understanding of compliance[Expansion of educational opportunities][Enhancement ofcompliance education]

A female trainer concurrently
on shortened working hours
for childcare

Advice based on her own
experiences

Female employees

Marine Products Department
Academy for department managers Step-up training for female employees(Development of next-generation(Career plan formation for female
manager candidates)
employees)― 24 ―

Compliance education throughcase studies and mini-tests

LIFE CORPORATION

Investment in employees (improvement ofcompensation, promotion of diverse work styles)• We have continuously implemented pay rises as an investment in employees• Adoption of the “Enhanced Support Package to Help Overcome the Annual Income
Barrier” to actively support the working environment for part-time employees[Pay rises]
Full-time
employees
正社員
Five-year
cumulative

Approx. 18%[Promotion of diverse working styles]
April 2024
Meeting with Prime Minister
Kishida to exchange opinions

President and part-time
employees exchanged
opinions with Prime
Minister KishidaPart-time employees•

Ten-yearcumulative

Approx. 20%

Discussed pay rises, annual
income barriers, and thecurrent environment forchildcare and employment
from an employee’s
perspective

Image source: Public Relations Office of the Government of Japan website(https://www.gov-online.go.jp/press_conferences/prime_minister/202404/video-282990.html)― 25 ―

LIFE CORPORATION

Breaking away from the homogeneous competition(development of BIO-RAL business)

BIO-RAL dedicatedstoresExisting stores
BIO-RAL corners

Up to FY2020

FY2023

2 stores7 stores93 stores

Approx. 290
stores(including shop type)(including shop type)

Business sales

Approx. ¥2.8
billionPB products

101 items

From FY2024

Establishment of the
BIO-RAL Business
Division

Approx. ¥10.0

billion358 items― 26 ―

Further store
openings andexpansion

LIFE CORPORATION

Breaking away from the homogeneous competition(deeper connections with customers)• Increase contact points with customers and expand the use of social media with anawareness of connection• Conduct highly accurate marketing through a renewed customer app.
■ New initiatives through social media■ Coupon distribution based on purchasedata analysis

Asking customers for recommended products→Disseminating popular products― 27 ―

LIFE CORPORATION

Contribution towards the realization of a sustainable
and flourishing society (environment)■Received the Grand Prize at the 2023 Osaka Environmental Awards(Description of the initiative: Efforts to reduce food waste that contribute to the realization of asustainable and flourishing society)
Donation of products to local
Holding on-demand classes on the foodReceived the Grand Prizechildren’s cafeterias

and the environment, etc.

Expanded to 18 locations,a threefold increase from FY2022

On-demand classes were held
over 300 times annually

The biogas power generation business that utilizes food residues
discharged from our processing centers at the Tempozan biogas
power generation facility
Our efforts aimed at reducing food waste were
well regarded as initiatives that will lead to atransformation of lifestyles and social systems― 28 ―

LIFE CORPORATION

Contribution towards the realization of a sustainable
and flourishing society (society)• Moving closer to realizing our Corporate Philosophy by contributing tolocal communities as infrastructure for everyday life
“Eat and Support! Hokkaido” Campaign

Selling dried sweet potatoes using
sweet potatoes grown in Higashiosaka

Promoting local production for local
consumption and the popularization of local
agricultural products in Higashiosaka City

Supporting producers through the sale of
attractive marine products from Hokkaido― 29 ―

LIFE CORPORATION

Contribution towards the realization of a sustainable
and flourishing society (society)•Steadily preparing for the ‘logistics 2024 problem’ by developing the logistics network

Between LIFE logistics centers and stores

Between manufacturers, etc. and logistics centers[FY2023]
Gradually starting initiatives from May 2023

[FY2023]
Launched Supermarket Logistics Study Group
with three other companies

Responding to changes such as reducing thenumber of trucks and reducing driver working
Research and proposals to improve efficiency forhours by reorganizing store operations withboth manufacturers, etc. and supermarkets
extra capacity created by improving productivity[FY2024][FY2024]

Expanding initiatives to further improve
efficiency
 Reduce in-house driver waiting time atcenters by changing the lead time for somecategories

15 companies are working together topromote these initiatives as an industry
 Reduce truck waiting time at logistics centers
 Research on joint delivery in the Tokyo Region― 30 ―

LIFE CORPORATION

Contribution towards the realization of a sustainable
and flourishing society (diversity)• Promote an environment where everyone can work comfortably• Realize the Corporate Philosophy by achieving our targets for FY2030
FY2022

FY2023[Ratio of Female Managers][Ratio of Female Managers]

9.4%

10.6% (+1.2P)[Percentage of male employees
taking childcare-related leave][Percentage of male employees
taking childcare-related leave]

50.9%

79.7% (+28.8P)[Ratio of employees with disabilities][Ratio of employees with disabilities]

3.2%

3.4% (+0.2P)― 31 ―

LIFE CORPORATION

Kaizen activities•

Implement “Kaizen activities” company-wide with the aim of improving productivity andoptimizing costs• A Smile Workshop, an event to share success stories held for the first time in four years, spreads
success stories throughout stores
Using the case studies presented as a reference, each store implements the practice in a manner
tailored to its own conditions
Improved efficiency
of display
operations
Multiskilling of
employees
Effective utilization of
the benefits ofintroducing electronic
shelf labels

・・・

Reduction of foodwaste

The 9th Osaka
RegionSmile Workshop― 32 ―

The 10th Tokyo
RegionSmile Workshop

LIFE CORPORATION

4. Topics― 33 ―

LIFE CORPORATION

Enhancement of information disclosure• Enhance information disclosure to a diverse range of investors in Japan andoverseas as a Prime Market listed company
In particular, we have increased the frequency of disclosure of English-language
information and financial results and reference documents■ Video message by President in English■ Quarterly financial results and reference
documents disclosure

1Q

NEW

― 34 ―

2Q

3Q

NEW

4Q

LIFE CORPORATION

Relocation of Tokyo Headquarters• The Tokyo Headquarters was relocated to Shinagawa Seaside in February 2024
• The move will improve working style efficiency and productivity■ Efficiency improvement in product development(completion of inspections within the company premises)

Test kitchen

Product inspection room

■ Improvement in productivity and workplace comfort

Standing meeting space― 35 ―Break room

LIFE CORPORATION

Governance• Transition to a company with an audit and supervisory committee isscheduled for resolution at the General Meeting of Shareholders in May 2024
• Revised the Corporate Governance Report in December 2023

Transition to a company
with an audit andsupervisory committee

Revised the Corporate
Governance Report(1) Strengthening thesupervisory function of
the Board of Directors(2) Acceleration ofdecision-making

Disclosure of “Action to
Implement Managementthat is Conscious of
Cost of Capital andStock Price”―36―LIFE CORPORATION

5. Full-year forecast for FY2024― 37 ―

LIFE CORPORATION

Full-year forecast for FY2024 (consolidated)• Aim to increase sales and profit based on the successful initiatives in FY2023(Unit: Millions of yen, %)Full-year FY2023

Full-year FY2024

Amount of
ChangeRate of
ChangeOperatingrevenue

809,709853,400+43,691+5.4

Net sales

780,028

821,800+41,772+5.4

Operatingprofit24,11824,700+582+2.4

Ordinary
profit24,94825,500+552+2.2

Profit16,93817,000+62+0.4― 38 ―

LIFE CORPORATION

Investment plan

(Unit: Millions of yen)

Full-year FY2023

Full-year FY2024

Major contents

New stores

10,021

10,000Open 11 new stores

Renovations

3,059

1,900

9 store renovations

IT and digitalsystems

3,857

7,000

Expanding use ofelectronic shelf labels
Cash register-related
equipment, etc.

Process
center

1,298

1,300

Production facilities, etc.

4,582

2,800 Existing store facilities, etc.

22,81723,000

Others(expensive equipment,
major repairs, etc.)

Total― 39 ―

LIFE CORPORATION

Reference: Dividend trends• FY2023: increased dividends from the initial plan, achieving a record high total
dividend of ¥90 per share• FY2024: plan for a full-year total dividend of ¥100 per share (+¥10 per share)(Unit: yen)100

(Unit: %)Commemorative dividends

3.2

Year-end

2.8

Interim

80

60

DOE (dividend on equity ratio)

1.9

2.4

2.6

70
Commemorative
dividends

30
20

3.0
2.5

50
2.0

30

1.5

25
20

1.0

15
15

90

35

40

40

3.5

70

10

50

3.3

20

30

25

35

40
0.5
0.0

0
18

19

20

21
― 40 ―

22

23 (Fiscal year)

LIFE CORPORATION― 41 ―