Flash Report on the Consolidated Financial Results
for the First Quarter of the Fiscal Year Ending February 29, 2020
July 11, 2019
Listed Company Name: Lawson, Inc.
Tokyo Stock Exchange (First Section)
Code No.: 2651
(URL http://www.lawson.jp/en/ir)
Company Representative: Sadanobu Takemasu, President and CEO, Representative Director,
Chairman of the Board
Contact: Tomoki Takanishi, Deputy Senior Vice President, Financial Administration Division Director
Tel.: +81-3-5435-2773
Scheduled date for submission of quarterly securities report: July 12, 2019
Scheduled date for payment of dividend: －Supplementary materials for quarterly financial results: Yes
Holding of presentation of quarterly results: None
(Amounts less than one million yen are truncated)
1. Consolidated operating results for the first quarter ended May 31, 2019 (from March 1, 2019 to May 31, 2019)(1) Consolidated operating results (cumulative)
Note: Percentages represent increases (decreases) compared with the corresponding period of the previous fiscal
year.

For the first quarter ended
May 31, 2019
May 31, 2018
Note: Comprehensive income:Gross operating
revenue

Operating income

Ordinary income

Millionsof yen178,800
170,516

Millionsof yen14,247
12,677

Millionsof yen13,39912,063

%
4.9
7.1

%
12.4
(22.0)For the first quarter ended May 31, 2019
For the first quarter ended May 31, 2018%11.1
(24.5)

Profitattributable toowners of parent
Millions%of yen
7,184
16.5
6,169
(35.7)

6,936 million yen
6,334 million yen

9.5%(35.1)%

Profit per share
Yen
71.80
61.65

Diluted profit per share
Yen
71.77
61.63

Total assets

Net assets

Millions of yen

Millions of yen

Shareholders’ equity
ratio%

May 31, 2019

1,486,833

271,56418.0

February 28, 2019

1,342,329

281,982

20.6

For the first quarter ended
May 31, 2019
May 31, 2018
(2) Consolidated financial position

As ofReference: Shareholders’ equity:
As of May 31, 2019267,334 million yen
As of February 28, 2019276,514 million yen
Note: Partial Amendments to Accounting Standard for Tax Effect Accounting (ASBJ Statement No. 28;
February 16, 2018), etc. have been applied from the beginning of the first quarter of the fiscal year ending
February 29, 2020 in preparing the consolidated financial statements. The standards have been retrospectively
applied to the consolidated financial statements for the previous fiscal year.

2. Dividends
1Q
Yen
2018 fiscal year－

2019 fiscal year－

Annual dividends per share
1H
3Q
Year-end
Yen
Yen
Yen
127.50－127.50

Total
Yen
255.0075.00

150.002019 fiscal year (forecast)

－

75.00

Note: Revision of the most recent dividends forecast: None
3. Forecast of consolidated operating results for the 2019 fiscal year ending February 29, 2020 (from March 1,
2019 to February 29, 2020)
Note: Percentages represent increases (decreases) compared with the corresponding period of the previous fiscal
year.
Profit attributable
Profit per
to owners of
shareparentMillions
Millions
Millions
Millions
%
%
%
%
Yen
of yenof yenof yenof yen2019 1H (cumulative)
365,000
3.7
33,500(2.9) 30,500(9.1) 15,500 (13.6) 154.90
2019 fiscal year
727,000
3.8
60,8000.0 54,500(5.5) 18,000 (29.6) 179.88
Note: Revision of the most recent consolidated operating results forecast: None
Gross operating
Operating income Ordinary income
revenue

4. Notes(1) Change in significant subsidiaries during the quarterly consolidated period (Changes in certain specified
subsidiaries resulting in changes in scope of consolidation): None
Added: None

Excluded: None

(2) Adoptions of specific accounting methods for preparing quarterly financial statements: None
(3) Changes in accounting policies, changes in accounting estimates or restatements
1. Changes in accounting policies associated with revision in accounting standards: Yes
2. Changes in accounting policies other than 1. above: None
3. Changes in accounting estimates: None
4. Retrospective restatements: None
Note: For changes in accounting policies associated with revision in accounting standards, please refer to “2.
Consolidated Financial Statements and Main Notes, (3) Notes to Consolidated Financial Statements(Changes in Accounting Policies)” on page 13.
(4) Number of shares outstanding (common stock)
1. Number of shares outstanding at the end of period (including treasury shares)
As of May 31, 2019:100,300,000
As of February 28, 2019:
2. Number of treasury shares at the end of period
As of May 31, 2019:237,597

As of February 28, 2019:

3. Average number of shares during the period (cumulative three months)
As of May 31, 2019:
100,058,804
As of May 31, 2018:

100,300,000

241,897
100,055,902

Note: This flash report is exempt from quarterly review.
Note: Descriptions on appropriate use of financial performance forecasts and other special notes
Forward-looking statements presented herein such as financial forecasts are based on currently available
information and certain presumptions deemed to be reasonable as of the date of announcement. The
achievement of said forecasts cannot be guaranteed. Actual results may be materially different from those in
the forecast as a result of various factors. For preconditions of these financial forecasts and notes concerning
their use, please refer to “1. Qualitative Information Regarding Quarterly Financial Results, (3) Explanation
Regarding Forward-looking Statements” on page 8.

Contents

1. Qualitative Information Regarding Quarterly Financial Results ·····························································

2(1) Explanation Regarding Consolidated Operating Results ······································································

2(2) Explanation Regarding Consolidated Financial Position ·····································································

8(3) Explanation Regarding Forward-looking Statements ···········································································

8

2. Consolidated Financial Statements and Main Notes ··················································································

9(1) Consolidated Balance Sheet ···············································································································

9(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income ·················

11

Consolidated Statement of Income ······································································································

11

Consolidated Statement of Comprehensive Income ·············································································

12(3) Notes to Consolidated Financial Statements ························································································

13(Going Concern Assumption) ·············································································································

13(Notes to Significant Changes in the Amount of Shareholders’ Equity) ···············································

13(Changes in Accounting Policies)········································································································

13(Additional Information) ···························································································

131

1．Qualitative Information Regarding Quarterly Financial Results(1) Explanation Regarding Consolidated Operating Results
During the first quarter of fiscal 2019, three months from March 1 to May 31, 2019, changes in community
needs resulting from an aging population, the prevalence of the nuclear family, the increasing number ofworking women, and the heightening awareness of healthy lifestyles, among others, are serving as a tailwind
for the convenience store industry. Meanwhile, competition is intensifying across sector lines andcircumstances surrounding franchise stores are also becoming increasingly challenging due to a labor shortage
and rising personnel expenses. Given such a business environment, we have made efforts to raise store
productivity by making maximum use of digital technology. Specifically, a few years ago we started introducing
a semi-automatic ordering system and new point-of-sale (POS) cash registers equipped with an automaticchange dispenser function. We will continue to provide franchise stores with stronger support and reinforce ourrelationships with them.
As a result, for the first quarter of fiscal 2019 on a consolidated basis, gross operating revenue increased to
178,800 million yen (up 4.9% from previous fiscal year), operating income increased to 14,247 million yen (up12.4% from previous fiscal year) and ordinary income increased to 13,399 million yen (up 11.1% from previous
fiscal year). Profit attributable to owners of parent increased to 7,184 million yen (up 16.5% from previous fiscal
year).
Furthermore, we also focused on promoting internal control and addressing operating risks across the entire
Group based on the 2019 Basic Policy for Improvement of Internal Control Systems. We will continue promotinginternal control even more.
Operating results by business segment were as follows:(Domestic Convenience Store Business)
In our convenience store business, we are striving to establish LAWSON stores as convenience stores
endorsed by all our customers. To this end, we are implementing measures to achieve our three commitments,
namely, to strengthen our product lineup, to be considerate to people, and to be environmentally friendly. Bydeveloping distinctive products that are compellingly delicious and health-conscious, we are aiming to further
reinforce our product lineup, while rigorously working to offer thoughtful customer service at our stores andensure environmental friendliness by reducing food waste and the use of plastics.
[Store Operations]
In store operations, we continued to focus on reinforcing adherence to the Three Essential Practices, whichemphasizes (1) serving customers courteously; (2) offering a merchandise assortment focused on basic itemswith high demand; and (3) keeping our stores and communities clean. During the current fiscal year, we aretaking decisive steps to improve store operations and strengthen franchise support by headquarters.
First, we started replacing our cash registers with self-checkout machines by leveraging the self-checkout
function of the new POS cash registers installed at all stores during the previous fiscal year. The replacement
is scheduled to be completed at all stores by autumn this year. We are also expanding the number of stores
equipped with the LAWSON Smartphone Cash Register, our mobile self-service payment system based on a
dedicated smartphone app, to streamline checkout and allow customers to purchase items without lining up at2

the cash register. Furthermore, we are also introducing new types of fixtures including self-serve cases for fried
food, which are convenient for customers and enhance operational efficiency at stores.
During the first quarter under review, for the purpose of improving store operation efficiency, we replaced
our store computers with new models equipped with functions that facilitate business management of multiple
stores as well as enhanced information processing capacity.
In March 2019, we launched a number of new services including WeChat Pay, which offers enhanced
convenience for tourists visiting Japan; Merpay, a smartphone payment service based on the Mercari app, which
is Japan’s largest flea market app; PayPay; and QUO Card Pay. In April, au PAY, a smartphone-based barcode
payment service, was added to our service lineup, bringing the number of barcode payment services available
at all LAWSON stores nationwide to 10.
[Merchandising and Service Strategies]
In the rice and noodles range, we added the “Kinshari Onigiri Series” to our standard rice ball lineup, andalso added a new flavor to our popular “Akuma-no-onigiri” (meaning “devil’s rice ball”) line, which helped
push up sales. Our pasta lineup featuring a firm and resilient texture and our chilled Chinese noodles lineup
were also well received.
In the counter fast food range, our long-selling “Karaage-kun” chicken nugget range was reinforced with theaddition of “Super Karaage-kun” containing condiments and featuring newly designed packaging, which
proved popular. We also strengthened our assortment of ready-made dishes offered during the evening andnighttime hours by focusing on “prepared food cups,” which can be served as part of dinner or as hors d'oeuvres.
In the bakery products range, we launched a new bread series named “Machinopan” (meaning “townbakery”) featuring meticulously selected basic ingredients and sophisticated production methods in a quest tooffer items with exquisite texture and delicious fillings. We also revamped our existing standard products byreviewing their ingredients and production methods, which resulted in strong sales for the entire bakery
products range.
In our dessert range, we launched a new kind of dessert named “BASCHEE” (short for Basque-stylecheesecake), which became a huge hit, recording sales of over one million units in the first three days of its
release in March. BASCHEE contributed to increased sales for the Uchi Café dessert range.
On our sales promotion side, we rolled out a Golden Week stamp rally campaign, and implemented effective
measures to attract customers, including a speed lottery capitalizing on our strength in the entertainment field.
[Breakdown of Sales by Merchandise Category at Chain Stores in Domestic Convenience Store Business]
Fiscal period

Product categories
Processed foods

Previous 1st Quarter
From March 1, 2018
to May 31, 2018
Net sales
Percentage of(Millions of yen)
total (%)
296,079
53.0

Current 1st Quarter
From March 1, 2019
to May 31, 2019
Net sales
Percentage of(Millions of yen)
total (%)
312,014
53.2

Fast foods

130,777

23.4

136,065

23.2

Daily delivered foods

82,105

14.7

87,722

14.9

Non-food products

49,8038.9

50,785

8.7

558,766

100.0

586,587

100.0

Total

3

(Note) These figures include stores operated by both Lawson, Inc. and Lawson Sanin, Inc.
[Store Development]
In opening new stores, the Group continued to focus on developing profitable stores.
Regarding the entire Lawson Group, the total number of LAWSON, NATURAL LAWSON, and LAWSONSTORE100 stores opened and closed during the current first quarter stood at 130 and 108 stores, respectively,
with the total number of stores reaching 14,681 as of the end of May 2019. *In an effort to establish convenience store models catered to an aging population and rising healthconsciousness, we are building partnerships with dispensing pharmacy and drug store chains to operate
healthcare-oriented LAWSON stores that offer over-the-counter pharmaceuticals and prescription drugs, aswell as a wider assortment of cosmetics and daily necessities than conventional LAWSON stores. The numberof stores offering non-prescription drugs has reached 214 stores (includes 48 pharmacy LAWSON stores
equipped with drug-dispensing pharmacies) as of the end of May 2019. Moreover, the number of stores offering
nursing care consultation services has reached 20 as of the end of May 2019. Furthermore, we have also been
expanding our chain of “in-hospital LAWSON stores,” which feature strengthened focus on medical, sanitary,
nursing and rehabilitation supplies in addition to merchandise and services offered at standard convenience
stores. The number of such stores has reached 313 as of the end of May 2019. Building on our expertisedeveloped through operation of in-hospital LAWSON stores, we will continue to support the lives of all peopleinteracting with hospitals.
With the aim of supporting our customers’ beauty, health, and comfortable lifestyles, our NATURALLAWSON stores offer an exclusive assortment of items including original products adopting select ingredients
as well as products produced in collaboration with renowned brand names. Meanwhile, our LAWSONSTORE100 meets customers’ needs with a wide-ranging assortment of products sold at the value-for-money
price of 100 yen, including fresh fruit and vegetables, daily delivered fresh foods, prepared dishes, beverages,
and daily necessities. As of the end of May 2019, we operate 141 NATURAL LAWSON stores and 797
LAWSON STORE100 stores.
* The numbers of store openings and closings and total number of stores in Japan include stores operatedby Lawson, Inc., subsidiary Lawson Sanin, Inc. and three equity-method affiliates, Lawson Kochi, Inc.,
Lawson Minamikyushu, Inc. and Lawson Okinawa, Inc.

[Change in the Total Number of Domestic Stores]
Total stores as ofFebruary 28, 2019

Change during
periodTotal stores as of
May 31, 201913,71429

13,743

NATURAL LAWSON

139

2

141

LAWSON STORE100

806

(9)

797

14,65922

14,681LAWSON

Total

4

[Number of LAWSON stores by prefecture (As of May 31, 2019)]
Prefecture

Numberof stores

Hokkaido

672

Ibaraki

224

Kyoto

331

Ehime

218

Aomori

262

Tokyo

1,741

Shiga

159

Tokushima

138

Akita

189

Kanagawa

1,127

Nara

141

Kochi

137

Iwate

181

Shizuoka

285

Wakayama

151

Fukuoka525

Miyagi254

Yamanashi

136

Osaka

1,152

Saga

74

Yamagata

113

Nagano

173

Hyogo

680

Nagasaki

112

Fukushima

159

Aichi

734

Okayama

204

Oita

190

Niigata

229

Gifu

182

Hiroshima

235

Kumamoto

158

Tochigi

205

Mie

142

Yamaguchi

116

Miyazaki

107

Gunma

256

Ishikawa

103

Tottori142

Kagoshima

199

Saitama704

Toyama193

Shimane149

Okinawa

232

Chiba

619

Fukui

114

Kagawa134

Total(domestic)

14,681

Prefecture

Numberof stores

Prefecture

Numberof stores

Prefecture

Numberof stores(Note) These figures include stores operated by Lawson, Inc., subsidiary Lawson Sanin, Inc. and equitymethod affiliates, Lawson Kochi, Inc., Lawson Minamikyushu, Inc. and Lawson Okinawa, Inc.

[Other]On April 25, 2019, we announced our action plan to support and build stronger relationships with franchise
stores as an initiative we have been and will be continuing to undertake. We are determined to extend even stronger
support to franchise stores, while working to reduce staffing requirements in their store operations as a measure
to cope with the worsening labor shortage.
On June 11, 2019, at LAWSON stores in Ehime and Okinawa prefectures, we implemented “Another Choice,”a food loss reduction program that engages customers, and encourages donations for children. Under this scheme,
Ponta card and d POINT CARD holders are rewarded with five points for every 100 yen spent on designated items
nearing their use-by date (tax excluded), with 5% of the total purchase value donated to support programs forchildren, who will shape our future.

As a result, Domestic Convenience Store Business posted gross operating revenue of 117,702 million yen (up2.2% from previous fiscal year) and segment profit of 11,095 million yen (up 9.1% from previous fiscal year).

(Seijo Ishii Business)
At stores of Seijo Ishii, a high-end supermarket chain offering quality foods, we provide our customers withwell-selected, safe, and reliable foods. The number of directly operated Seijo Ishii stores reached 149 as of theend of May 2019. Driven by widely successful original hit products, sales were solid, and the wide array of wellselected products has been endorsed by many customers. In addition, we started selling some frozen Chinese fooditems from the Seijo Ishii “desica” series at LAWSON stores nationwide, which were also well received. By
5continuing to leverage the company’s strengths including its product development expertise, know-how acquired
as a manufacturing retailer, and retailing techniques, we will endeavor to enhance the brand capacity of Seijo Ishii.

As a result, Seijo Ishii Business posted gross operating revenue of 23,253 million yen (up 8.1% from previous
fiscal year) and segment profit of 2,292 million yen (up 22.3% from previous fiscal year).

(Entertainment-related Business)
With regard to our Entertainment-related Business, the ticketing business of Lawson Entertainment, Inc., whichforms the core of the business, continued to secure top-class transaction value in the ticketing industry. In our
product sales business, as of the end of May 2019 we operate 55 stores, mainly comprised of HMV storesdedicated to selling music and video software nationwide, as well as HMV&BOOKS, which markets books, CDs,
and DVDs, and HMV Record Shop stores specializing in analog records. In April 2019, we started offering“HMVmusic powered by KKBOX,” a music subscription service, in partnership with KKBOX Japan LLC.
As of the end of May 2019, United Cinemas Co., Ltd., an operator of cinema complexes, operates cinema
theaters at 41 sites nationwide, offering 367 screens including those operated on commission.
As a result, Entertainment-related Business posted gross operating revenue of 21,000 million yen (up 8.7%
from previous fiscal year) and segment profit of 1,812 million yen (up 57.6% from previous fiscal year).
(Financial Services Business)
With respect to our Financial Services Business, during the first quarter under review in our ATM business, thefoundation of our banking business, we expanded our network of financial institution partners, while working to
expand Lawson Bank’s ATM service. In May 2019, Lawson Bank concluded an agreement with Norinchukin
Bank to install Lawson Bank’s ATMs at JA Banks. From the current fiscal year ending February 2020,
Norinchukin Bank ATMs currently installed in JA Banks will be replaced by Lawson Bank ATMs in accordancewith requests by Japan Agricultural Cooperatives (JA) and the Prefectural Banking Federations of Agricultural
Cooperatives (JA Shinnoren).
In January 2019, Lawson Bank started issuing LAWSON Ponta Plus credit cards, which allow cardholders tocollect extra Ponta points when using their cards at LAWSON stores, NATURAL LAWSON stores, or LAWSONSTORE100. By emphasizing its Special Stage Program, in which extra Ponta points commensurate with the totalmonthly transactions are rewarded every month, LAWSON Ponta Plus credit card membership is expanding.
Starting April 2019, we have also been taking further measures to enhance customer convenience, including
allowing LAWSON Ponta Plus cardholders to make mobile payments through Apple Pay.
As of the end of May 2019, the number of ATMs installed nationwide reached 13,500 (up 41 from previous
fiscal year), with each ATM used 47.9 times a day on average. The total number of our financial institution
partners increased to 117 nationwide (up 6 from previous fiscal year), including online banks.
As a result, Financial Services Business posted gross operating revenue of 8,440 million yen (up 17.3% fromprevious fiscal year) and segment profit of 528 million yen (down 34.6% from previous fiscal year).

6(Other Business)
In addition to the aforementioned businesses, the Group is also involved in the Overseas Business.
With regards to Overseas Business, the Group’s operating companies opened LAWSON stores in the People’s
Republic of China, Thailand, Indonesia, the Philippines, and the United States of America (Hawaii).
In the People’s Republic of China, we have expanded mainly into Shanghai, as well as into Chongqing, Dalian,Beijing, Wuhan, Hefei, and other cities. In June 2019, we became the first Japanese convenience store operator toadvance into Hunan province, opening five stores in Changsha, the capital city of the province. The number of
LAWSON stores in the entire country reached 2,153 as of the end of May 2019.

[Distribution of LAWSON Brand Stores Overseas by Region]
Country/Region

Number of stores(As of February 28,
2019)

Changeduring fiscal
year

Number of stores(As of May 31,
2019)

1,227

119

1,346

China

Shanghai and surrounding area

China

Chongqing

198

6

204

China

Dalian

146

5

151

China

Beijing

108

－

108

China

Wuhan

308

14

322

China

Hefei

20

2

22

Thailand

120

2

122

Indonesia

42

1

43

Philippines

39

3

42

2

－

2

2,210

152

2,362

United States of America

HawaiiTotal

As a result, Other Business posted gross operating revenue of 11,032 million yen (up 16.5% from previous
fiscal year) and segment loss of 1,481 million yen (up 11.6% from previous fiscal year).

7(2) Explanation Regarding Consolidated Financial Position
Current assets increased by 132,904 million yen from the end of the previous fiscal year to 752,508 million
yen, mainly reflecting an increase of 101,959 million yen in cash and deposits. Non-current assets increasedby 11,599 million yen from the end of the previous fiscal year to 734,325 million yen, mainly reflecting
increases of 14,590 million yen in property and store equipment. Consequently, total assets increased by
144,504 million yen from the end of the previous fiscal year to 1,486,833 million yen.
Current liabilities increased by 145,846 million yen from the end of the previous fiscal year to 744,369
million yen, mainly reflecting an increase of 68,111 million yen in deposits received, and an increase of
37,900 million yen in short-term loans payable. Non-current liabilities increased by 9,075 million yen fromthe end of the previous fiscal year to 470,900 million yen, mainly reflecting an increase of 9,033 million yen
in lease obligations. Consequently, total liabilities increased by 154,922 million yen from the end of theprevious fiscal year to 1,215,269 million yen.
Net assets decreased by 10,418 million yen from the end of the previous fiscal year to 271,564 million yen,mainly reflecting a decrease of 6,590 million yen in retained earnings. Consequently, shareholders’ equity
ratio was 18.0%, down from 20.6% as of the end of the previous fiscal year.
Partial Amendments to Accounting Standard for Tax Effect Accounting (ASBJ Statement No. 28; February
16, 2018), etc. have been applied from the beginning of the first quarter of the fiscal year ending February 29,2020 in preparing the consolidated financial statements. Related information regarding the consolidated
financial position at the end of the first quarter under review was calculated based on an analysis incomparison with the consolidated financial statements for the previous fiscal year after retrospectively
applying the standards.

(3) Explanation Regarding Forward-looking Statements
Regarding the financial forecasts for the first half and full year of the current fiscal year ending February
29, 2020, the financial forecasts remain unchanged from those announced on April 11, 2019.

8

2. Consolidated Financial Statements and Main Notes(1) Consolidated Balance Sheet
As of February 28, 2019 and May 31, 2019
(Millions of yen)

AssetsCurrent assets:
Cash and deposits
Accounts receivable-due from franchised stores
Lease receivables
Merchandise
Accounts receivable-other
Other
Allowance for doubtful accounts
Total current assets
Non-current assets:
Property and store equipment:
Buildings and structures, net
Tools, furniture and fixtures, net
Leased assets, net
Other, net
Total property and store equipment
Intangible assets:
Software
Goodwill
Trademark right
Other
Total intangible assets
Investments and other assets:Long-term loans receivable
Guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets

9Previous fiscal year
As of
February 28, 2019

Current 1st Quarter
As of
May 31, 2019354,240
47,17919,12020,862120,969
57,355(124)
619,603456,199
51,09818,81722,034
137,526
67,068(236)
752,508

207,755
16,056
146,880
11,607382,300

207,975
16,152
149,375
23,387
396,890

49,791
46,836
9,468
576
106,672

50,16045,7399,315
592
105,808

44,024
107,034
30,99552,535(835)
233,753
722,726
1,342,329

44,198107,373
30,18850,729(863)
231,626
734,325
1,486,833

(Millions of yen)

Liabilities
Current liabilities:
Accounts payable-trade
Short-term loans payable
Current portion of long-term loans payable
Lease obligations
Accounts payable-other
Income taxes payable
Deposits received
Provision for bonuses
Other
Total current liabilities
Non-current liabilities:
Long-term loans payable
Lease obligations
Deferred tax liabilities
Provision for retirement benefits to executive officers
and audit and supervisory board members
Net defined benefit liability
Asset retirement obligations
Other
Total non-current liabilities
Total liabilities
Net assets
Shareholders’ equity:
Capital stock
Capital surplus
Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income:
Valuation difference on available-for-sale securities
Revaluation reserve for land
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Subscription rights to shares
Non-controlling interests
Total net assets
Total liabilities and net assets

10Previous fiscal year
As of
February 28, 2019

Current 1st Quarter
As of
May 31, 2019

123,408
126,600
50,00038,750101,995
6,683
131,804
4,263
15,015598,522

137,590
164,500
50,00043,53593,445
2,874
199,916
3,322
49,184744,369

260,000
131,441550

260,000
140,475
548

300

325

15,125
31,102
23,303461,824
1,060,347

15,35831,30622,887
470,900
1,215,269

58,506
46,984
166,187(1,028)
270,649

58,50644,605
159,596(1,010)261,698

3,349
(566)
3,930
(848)
5,865
215
5,251
281,982
1,342,329

2,863
(566)
4,133
(794)
5,636
201
4,028
271,564
1,486,833

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income
Consolidated Statement of Income
For the first quarter of the fiscal year ended February 28, 2019 and the first quarter of the fiscal year ending
February 29, 2020
(Millions of yen)

Gross operating revenue
Net sales
Cost of sales
Gross profit
Operating revenue:
Income from franchised stores
Other operating revenue
Total operating revenue
Operating gross profit
Selling, general and administrative expenses
Operating income
Non-operating income:Interest income
Share of profit of entities accounted for using equity
methodOther
Total non-operating income
Non-operating expenses:
Interest expenses
Loss on cancellation of leases
Other
Total non-operating expenses
Ordinary income
Extraordinary losses:
Loss on retirement of non-current assets
Impairment loss
Other
Total extraordinary losses
Profit before income taxes
Income taxes-current
Income taxes-deferred
Total income taxes
ProfitProfit (loss) attributable to non-controlling interests
Profit attributable to owners of parent

11

Previous 1st Quarter
From March 1, 2018
to May 31, 2018
170,516
71,99849,534
22,463Current 1st Quarter
From March 1, 2019
to May 31, 2019
178,800
74,28150,27624,00573,82924,68898,517
120,981
108,304
12,677

77,58426,934
104,518
128,523
114,276
14,247

192

159

223

239

491
907

427
826

594
552
373
1,521
12,063

971
393
309
1,674
13,399

838
516
13
1,369
10,694
3,705
807
4,513
6,181
12
6,169

1,021
650
183
1,855
11,543
3,366
1,027
4,393
7,150
(34)
7,184

Consolidated Statement of Comprehensive Income
For the first quarter of the fiscal year ended February 28, 2019 and the first quarter of the fiscal year ending
February 29, 2020
(Millions of yen)

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to
Owners of parent
Non-controlling interests

12

Previous 1st Quarter
From March 1, 2018
to May 31, 2018
6,181

Current 1st Quarter
From March 1, 2019
to May 31, 2019
7,150

278
(158)
32
153
6,334

(485)
218
53
(213)
6,936

6,328
5

6,955
(19)

(3) Notes to Consolidated Financial Statements(Going Concern Assumption)
Not Applicable.

(Notes to Significant Changes in the Amount of Shareholders’ Equity)
Not Applicable.

(Changes in Accounting Policies)
The Company’s foreign consolidated subsidiaries are applying International Financial Reporting Standard
16 “Leases” (IFRS 16) from the first quarter of the fiscal year ending February 29, 2020.
The impact of the application of IFRS 16 on the Company’s consolidated financial statements is immaterial.

(Additional Information)(Application of Partial Amendments to Accounting Standard for Tax Effect Accounting, etc.)
Partial Amendments to Accounting Standard for Tax Effect Accounting (ASBJ Statement No. 28; February
16, 2018), etc. have been applied from the beginning of the first quarter of the fiscal year ending February
29, 2020 in preparing the consolidated financial statements. Accordingly, deferred tax assets are classified as
investments and other assets and deferred tax liabilities are classified as non-current liabilities.
(Application of consolidated taxation system)
The Company and certain of its consolidated subsidiaries have applied the consolidated taxation systemfrom the first quarter of the fiscal year ending February 29, 2020.

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