1. Consolidated results for the first quarter of the fiscal year ending May 2024 (May 16, 2023 to August 15, 2023)

(2) Consolidated financial position

2. 2. Dividend status

(Note) Whether or not there is any revision from the recently announced dividend forecast:Nothing

3. Consolidated earnings forecast for the fiscal year ending May 2024 (May 16, 2023 to May 15, 2024)

(Note) Whether or not there is any revision from the latest announced business forecast:Nothing

* Notes

(1) Changes in significant subsidiaries during the current quarterly consolidated cumulative period (changes in specified subsidiaries due to changes in the scope of consolidation):Nothing

(2) Application of accounting treatment specific to the preparation of quarterly consolidated financial statements:Yes

(3) Changes in accounting policies, changes in accounting estimates, and restatements of revisions

① Changes in accounting policies due to revisions to accounting standards, etc .:Nothing

(2) Changes in accounting policies other than (1):Nothing

③ Change of accounting estimateNothing

④ Correction redisplayNothing

(4) Number of issued shares (common stock)

* Quarterly financial statements are not subject to quarterly reviews by certified accountants or audit corporations.

* Explanation of proper use of business forecasts and other special notes

The forecast figures contained in this document are forecasts based on currently available information and contain many uncertainties. Actual results may differ from the above figures due to changes in business conditions. Please refer to page 2 of the attachment for matters related to the above forecasts.

○ Contents of attached materials

1. Qualitative information on quarterly financial results

(1) Explanation of operating results

The economic situation during the current first quarter consolidated cumulative period (May 16, 2023 to August 15, 2023) is that the economy is slowly recovering as movement restrictions are lifted due to the transition to Category 5 of the new coronavirus infection. This is a trend. Although there are signs of improvement in consumer sentiment, it is necessary to pay attention to the downside risks of overseas economies such as China, Europe, and the United States.

In the drugstore industry, although the competitive environment remains tough as companies expand their store openings, sales of pharmaceuticals and cosmetics are growing as the flow of people recovers, and food products, whose prices have been rising, performed well due to their reasonable prices. On the other hand, there is a cause for concern that consumers' purchasing appetite is slowing down due to successive price increases.

Under these circumstances, our group aims to achieve the new medium-term management plan by improving the accuracy of store openings and promoting renovations, and by expanding the number of affiliated stores, securing the number of prescriptions by using online, and promoting PB (PB). Under the private brand strategy, we have been working on increasing the sales composition ratio by developing new products and promoting sales of existing products, and under the DX strategy, we have been working on introducing our own payment service, utilizing customer data for sales promotions, and developing IT systems. Additionally, in terms of performance management, we have worked to improve profitability and reduce selling, general and administrative expenses by strengthening forecast and actual analysis functions.

Regarding store development, we are working to further strengthen our dominance in existing areas and proceeding with the reform and closure of unprofitable stores to strengthen our competitiveness.From the beginning of the fiscal year, we have opened 30 new stores, taken over the business of one store, and closed 32 stores. . As a result, the number of directly managed Group stores at the end of the fiscal year was 2,588. Regarding our group stores in Thailand, we have closed one store, bringing the number of stores in the country to 17 as of August 15, 2023.

The status of store openings and closings of the Group is as follows: (Unit: Stores)

In addition to the above, we have 17 overseas stores and 7 franchise stores.

*From the beginning of the current fiscal year, we have reviewed the standards for counting the number of stores such as e-commerce stores and FC stores, and there are some differences between the number of stores at the beginning of the fiscal year and the number of stores at the end of the previous fiscal year.

As a result, the business results for the first quarter of the current consolidated cumulative period were as follows: sales of 259,827 million yen (up 6.8% year on year), operating income of 14,103 million yen (up 5.9% year on year), and ordinary income of 142 million yen. Net income attributable to owners of parent amounted to 8,269 million yen (up 10.2%).

(2) Explanation of financial position

Total assets at the end of the current first quarter consolidated accounting period decreased by 4,659 million yen compared to the end of the previous consolidated fiscal year, to 535,171 million yen. The main reason was a decrease in cash and deposits.

Total liabilities increased by 2,527 million yen compared to the end of the previous fiscal year, to 238,213 million yen. The main reason was an increase in accounts payable due to new store openings.

Total net assets decreased by 7,187 million yen compared to the end of the previous fiscal year, to 296,957 million yen. This was mainly due to a decrease in capital surplus and non-controlling interests due to the additional acquisition of shares in consolidated subsidiary Drug Eleven Co., Ltd.

As a result of the above, the equity ratio decreased by 0.2 points to 51.0%.

(3) Explanation of future forecast information such as consolidated earnings forecasts

There are no changes to the full-year business forecast announced on June 23, 2023.

2. 2. Quarterly consolidated financial statements and main notes

(2) Quarterly consolidated income statement and quarterly consolidated income statement

(Quarterly consolidated income statement)

(Quarterly Consolidated Comprehensive Income Statement)