Belc : (DELAYED)Consolidated Financial Results for the Six Months Ended August 31, 2021

Consolidated Financial Results

for the Six Months Ended August 31, 2021

[Japanese GAAP]

October 7, 2021

Company name: Belc CO., LTD.

Stock exchange listing: Tokyo Stock Exchange

Code number: 9974

URL: https://www.belc.jp

Representative: Issei Harashima, President and Representative Director

Contact: Hideo Ueda, Senior Managing Director; Associate GM of Compliance Office; Responsible for Finance and Accounting Department and Operations Support Department, and in charge of Legal Affairs

Phone: [phone]

Scheduled date of filing quarterly securities report: October 12, 2021

Scheduled date of commencing dividend payments: November 1, 2021

Availability of supplementary explanatory materials on quarterly financial results: Available

Schedule of quarterly financial results briefing session: Not scheduled

(Amounts of less than one million yen are rounded down.)

1. Consolidated Financial Results for the Six Months Ended August 31, 2021 (March 1, 2021 - August 31, 2021)

(1) Consolidated Operating Results (Cumulative)		(% indicates changes from the previous corresponding period.)
				Operating income			Operating profit			Ordinary profit		Profit attributable to
									owners of parent
	Six months ended			Million yen	%		Million yen	%			Million yen	%		Million yen	%
	August 31, 2021		149,132	6.5			7,392		(4.7)		7,781	(4.5)		5,248	(9.1)
	August 31, 2020		140,014	20.5			7,756		56.7		8,151	54.2		5,776	63.9
	(Note) Comprehensive income: Six months ended August 31, 2021: ¥5,280 million [(9.1)%]
					Six months ended August 31, 2020: ¥5,806 million [64.8%]
				Basic earnings			Diluted
						earnings
				per share
						per share
	Six months ended						Yen					Yen
	August 31, 2021		251.55					-
	August 31, 2020		276.83					-
(2) Consolidated Financial Position
					Total assets				Net assets		Equity ratio
							Million yen			Million yen				%
	As of August 31, 2021			144,481				80,604				55.8
	As of February 28, 2021			136,558				76,283				55.9
(Reference) Equity: As of August 31, 2021: ¥80,604 million
		As of February 28, 2021: ¥76,283 million
2. Dividends
										Annual dividends
		1st quarter-		2nd quarter-		3rd quarter-			Year-end		Total
				end		end				end
					Yen				Yen		Yen						Yen		Yen
Fiscal year ended				-		40.00			-					46.00		86.00
February 28, 2021
Fiscal year ending				-		43.00
February 28, 2022
Fiscal year ending												-					43.00		86.00
February 28, 2022
(Forecast)

(Note) Revision to the forecast for dividends announced most recently: None

3. Consolidated Financial Results Forecast for the Fiscal Year Ending February 28, 2022 (March 1, 2021 - February 28, 2022)

(% indicates changes from the previous corresponding period.)

							Profit attributable	Basic earnings
	Operating income	Operating profit	Ordinary profit	to owners of
	per share
							parent
	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Yen
Full year	283,597	(0.3)	11,308	(5.2)	11,996	(5.4)	8,031	(9.0)	384.88

(Note) Revision to the financial results forecast announced most recently: None

* Notes:

1. Changes in significant subsidiaries during the period: None
   (Changes in specified subsidiaries resulting in changes in scope of consolidation) Newly included: -
   Excluded: -
2. Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, changes in accounting estimates and retrospective restatement
4. 1. Changes in accounting policies due to the revision of accounting standards: None
   2. Changes in accounting policies other than 1) above: None
   3. Changes in accounting estimates: None
   4. Retrospective restatement: None
5. Total number of issued and outstanding shares (common shares)
6. 1. Total number of issued and outstanding shares at the end of the period (including treasury shares):

August 31, 2021:	20,867,800 shares
February 28, 2021:	20,867,800 shares
2) Total number of treasury shares at the end of the period:
August 31, 2021:	1,153 shares
February 28, 2021:	1,153 shares

3) Average number of shares during the period (cumulative from the beginning of the fiscal year):

Six months ended August 31, 2021:	20,866,647 shares
Six months ended August 31, 2020:	20,866,742 shares

• These quarterly consolidated financial results are outside the scope of quarterly reviews by certified public accountants or an audit firm.
• Explanation of the proper use of financial results forecasts and other notes
  The business outlook and other forward-looking statements in these materials are based on information currently available to the Company and certain assumptions that are deemed reasonable. Actual financial results, etc. may significantly vary from these forecasts due to various factors. For the assumptions used in the above financial results forecasts and other related matters, please refer to "1. Qualitative Information on Quarterly Financial Results for the Period under Review (3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Statements" on page 3.

Table of Contents - Attachments
1. Qualitative Information on Quarterly Financial Results for the Period under Review .......................	2
(1)	Explanation of Operating Results ....................................................................................................	2
(2)	Explanation of Financial Position ....................................................................................................	3
(3)	Explanation of Consolidated Financial Results Forecast and Other Forward-looking Statements ..	3
2. Quarterly Consolidated Financial Statements and Principal Notes ......................................................	4
(1)	Quarterly Consolidated Balance Sheets ...........................................................................................	4
(2)	Quarterly Consolidated Statements of Income and Comprehensive Income ...................................	6
	Quarterly Consolidated Statements of Income .................................................................................	6
	Quarterly Consolidated Statements of Comprehensive Income .......................................................	7
(3)	Notes to Quarterly Consolidated Financial Statements ....................................................................	8
	(Notes on going concern assumption) .........................................................................................	8
	(Notes in case of significant changes in shareholders' equity) ....................................................	8

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1. Qualitative Information on Quarterly Financial Results for the Period under Review

1. Explanation of Operating Results
   During the six months ended August 31, 2021, expectations are high for the Japanese economy to recover as the level of social and economic activity gradually increases, with efforts, including the COVID-19 vaccination rollout. However, due care must still be taken with respect to the risk of the trends of COVID-19 causing downturns in the domestic or overseas economies, and the economic outlook, including the impact of changes in the financial and capital markets, remains uncertain.
   In the retail industry, amid the daily fluctuations in the number of new cases of COVID-19, the voluntary restraints by consumers to go out, and their reluctance to buy as a result of changes in consumer behavior due to the declaration of the state of emergency by the government, conditions remain harsh, with increasingly fierce competition across business types and categories.
   In this environment, the Belc Group (the "Group") has worked to sell delicious and fresh products, emphasize our price appeal, and create stores that are supported and trusted by customers, led by our motto of "Better Quality & Lower Price," so that we, as a supermarket, can provide members of local communities with richer lives.
   Below is an overview of the main initiatives we have implemented.
   In our sales measures, we have continued with business as usual, supplied products, and fulfilled our role as a lifeline in communities while employing various measures to prevent the spread of COVID-19. In April, to commemorate the number of Belc card members exceeding two million, we made efforts to give customers more incentives to visit our stores, including a massive promotional campaign in which customers won big prizes. We have also been enhancing the convenience of our customers by gradually expanding the stores that support "Belc otodoke (delivery) pack," our online grocery shopping service, and "smabelc," a service that enables smart shopping and eases the lines at the check-out counters. Furthermore, we have pushed ahead with our efforts to provide shopping assistance to the elderly and other customers through increasing the availability of our mobile supermarket, "Tokushimaru."
   In our product measures, we have promoted our select products by creating conceptual flyers that focus on the products. We also have expanded our offering of products in our private brand, "kurabelc (Belc for everyday life)," successively launching new and reasonably priced products that help improve people's daily lives.
   In our store operations, we have used the Company's greatest feature, our standardized corporate structure, as a foundation on which we have firmly established our labor scheduling program (LSP), appropriately allocated personnel, and leveraged labor-saving equipment to promote efficient chain operation.
   As for our store investments, we newly opened Toda Hikawa-cho Store in Toda City, Saitama Prefecture in July 2021. In addition, we renovated four existing stores, expanded their deli and convenience food selections, and updated the facilities to provide more pleasant shopping environments. In March 2021, we closed the Satte Minami Store in Satte City, Saitama Prefecture. As a result, we operate 123 stores as of August 31, 2021.
   We have leveraged our in-house logistics strengths to carry out large-scale batch procurement of products from production sites and manufacturers, through which we aim to improve our delivery efficiency and product price competitiveness while achieving more consistent product quality. We have also continued to review and revise our delivery system based on the work performed at stores, and to improve the efficiency of store operations.
   As a result, operating income (net sales and operating revenue combined) for the six months ended August 31, 2021 was ¥149,132 million (106.5% of that of the same period of the previous fiscal year), operating profit was ¥7,392 million (95.3% of that of the same period of the previous fiscal year), ordinary profit was ¥7,781 million (95.5% of that of the same period of the previous fiscal year) and profit attributable to owners of parent was ¥5,248 million (90.9% of that of the same period of the previous fiscal year).

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1. Explanation of Financial Position (Assets)
   Total assets as of August 31, 2021 were ¥144,481 million, an increase of ¥7,922 million compared with the end of the previous fiscal year.
   Current assets were ¥24,333 million, an increase of ¥1,078 million compared with the end of the previous fiscal year, due mainly to an increase of ¥994 million in accounts receivable - trade.
   Non-current assets were ¥120,148 million, an increase of ¥6,844 million compared with the end of the previous fiscal year, due mainly to an increase of ¥3,487 million in land.
   (Liabilities)
   Liabilities were ¥63,877 million, an increase of ¥3,602 million compared with the end of the previous fiscal year.
   Current liabilities were ¥37,201 million, an increase of ¥2,452 million compared with the end of the previous fiscal year, due mainly to an increase of ¥3,245 million in accounts payable - trade.
   Non-current liabilities were ¥26,676 million, an increase of ¥1,149 million compared with the end of the previous fiscal year, due mainly to an increase of ¥1,561 million in long-term borrowings.
   (Net assets)
   Net assets were ¥80,604 million, an increase of ¥4,320 million compared with the end of the previous fiscal year, due mainly to an increase of ¥4,289 million in retained earnings.
2. Explanation of Consolidated Financial Results Forecast and Other Forward-looking Statements
   As for the future outlook, amid the daily fluctuations in the spread of COVID-19, the vaccination rollout is gradually taking hold, and expectations are high for economic activities to resume. Nevertheless, given the difficulty of predicting when the pandemic will actually be contained and the prevailing economic instability, the economic outlook is expected to remain uncertain.
   Taking into consideration the above circumstances, the Company has decided not to revise the financial results forecast for the fiscal year ending February 28, 2022 announced on April 9, 2021. Going forward, the Company will disclose any events that could significantly impact its business performance as soon as they occur.

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