パルグループホールディングス（2726） – [Delayed]Consolidated Financial Results for the Nine Months Ended November 30,2021 [Japanese GAAP]

Consolidated Financial Results for the Nine Months Ended November 30, 2021 [Japanese GAAP] January 12, 2022 Company name: PAL GROUP Holdings CO., LTD. Stock exchange listing: Tokyo Stock Exchange Code number: 2726 URL: http://www.palgroup.holdings/ Representative: Ryuta Inoue, President and Representative Director Contact: Toshio Fujii, Executive Officer and General Manager of Finance and Accounting Department Phone: +81-6-6227-0308 Scheduled date of filing quarterly securities report: January 13, 2022 Scheduled date of commencing dividend payments: ― Availability of supplementary briefing material on quarterly financial results: Not available Schedule of quarterly financial results briefing session: Not scheduled 1. Consolidated Financial Results for the Nine Months Ended November 30, 2021 (March 1, 2021 to November (Amounts of less than one million yen are rounded down.) Net sales million yen % Operating profit (% indicates changes from the previous corresponding period.) Profit attributable to owners of parent million yen Ordinary profit million yen million yen % % % 98,512 27.8 5,633 288.4 5,720 366.3 3,680 521.2 77,059 (22.7) 1,450 (81.9) 1,226 (84.7) 592 (90.8) (Note) Comprehensive income: Nine months ended November 30, 2021: ¥3,688 million [523.6%] Nine months ended November 30, 2020: ¥591 million [(90.9)%] (1) Consolidated Operating Results 30, 2021) Nine months ended November 30, 2021 Nine months ended November 30, 2020 Nine months ended November 30, 2021 Nine months ended November 30, 2020 As of November 30, 2021 As of February 28, 2021 (2) Consolidated Financial Position Basic earnings per share Diluted earnings per share yen 83.80 13.49 yen ― ― Total assets Net assets Equity ratio million yen 95,940 108,186 million yen 47,038 44,351 % 49.0 41.0 (Reference) Equity: As of November 30, 2021: ¥46,963 million As of February 28, 2021: ¥44,351 million 2. Dividends Fiscal year ended February 28, 2021 Fiscal year ending February 28, 2022 Fiscal year ending February 28, 2022 (Forecast) February 28, 2022) 1st quarter-end yen 2nd quarter-end yen Annual dividends 3rd quarter-end yen ― ― 0.00 0.00 Year-end Total yen 25.00 yen 25.00 50.00 50.00 ― ― (Note) Revision of dividend forecast: No 3. Consolidated Financial Results Forecast for the Fiscal Year Ending February 28, 2022 (March 1, 2021 to million yen % million yen % million yen % million yen Full year 131,000 20.7 7,400 434.8 7,100 574.3 yen 88.79 (% indicates changes from the previous corresponding period.) Basic earnings per share Ordinary profit Profit attributable to owners of parent % 3,900 1,340.4 Net sales Operating profit (Note) Revision of consolidated financial results forecast: No * Notes (1) Changes in significant subsidiaries during the period under review: No (2) Adoption of special accounting methods for preparing quarterly consolidated financial statement: No (3) Changes in accounting policies, changes in accounting estimates and corrections of errors 1) Changes in accounting policies due to the revision of accounting standards: No 2) Any changes other than 1) above: No 3) Changes in accounting estimates: No 4) Corrections of errors: No (4) Total number of issued shares (common shares) 1) Total number of issued shares at the end of the period (including treasury shares): 2) Total number of treasury shares at the end of the period: As of November 30, 2021 As of February 28, 2021 As of November 30, 2021 As of February 28, 2021 46,272,000 shares 46,272,000 shares 2,346,244 shares 2,346,134 shares 3) Average number of shares during the period: Nine months ended November 30, 2021 Nine months ended November 30, 2020 43,925,771 shares 43,929,975 shares * These quarterly consolidated financial results are not covered by the quarterly review conducted by certified public accountants or audit corporations. * Explanation of the proper use of financial results forecast and other notes The statements regarding financial results forecast in this report are based on the information that is available, as well as estimates, assumptions and projections that are believed to be reasonable at the time of publication, and do not guarantee the achievement of the projections. Therefore, there might be cases in which actual results differ from forecast values. Appendix (1) Explanation of Operating Results (2) Explanation of Financial Position 2. Consolidated Financial Statements (1) Consolidated Balance Sheets 1. Qualitative Information on Consolidated Financial Results for the Period under Review (3) Explanation of Consolidated Financial Results Forecast and Other Future Projections (2) Consolidated Statements of Income and Comprehensive Income 3. Additional Information (1) Sales Results by Segment (Consolidated) (2) Status of Stores (Consolidated) 2 2 2 3 4 4 6 8 8 8 1 1. Qualitative Information on Consolidated Financial Results for the Period under Review (1) Explanation of Operating Results During the nine months ended November 30, 2021 (March 1, 2021 to November 30, 2021), the Japanese economy suffered from the declaration of a state of emergency across several prefectures and the implementation of priority preventative measures, which had a significant impact on personal consumption. The lifting of the state of emergency and all priority preventative measures on September 30 has increased customer traffic in stores, and conditions are on their way to recovery. However, the outlook remains uncertain, with an increase in COVID-19 cases due to the emergence of new variants. Under such a business environment, the Company made every effort to strengthen EC sales to make up for the decline in customer traffic, while securing the health and safety of its employees. At the same time, the Company focused on the lifestyle miscellaneous goods/accessories brand centered on 3COINS to respond to stay-at-home demand. As a result of these measures, net sales in the Apparel Business increased by 15.8% year on year to ¥62,984 million, and net sales in the Miscellaneous Goods/Accessories Business increased by 56.9% year on year to ¥35,456 million. In addition, EC sales increased by 41.2% year on year. In particular, sales of PAL CLOSET, our own e-commerce website, increased by 62.2% year on year. As a result of the above, net sales for the nine months ended November 30, 2021 increased by 27.8% year on year to ¥98,512 million. In terms of profit, the gross profit margin increased by 0.1 percentage point year on year to 55.9%. Operating profit increased by ¥4,182 million year on year to ¥5,633 million, ordinary profit increased by ¥4,494 million year on year to ¥5,720 million, and profit attributable to owners of parent increased by ¥3,088 million year on year to ¥3,680 million. (2) Explanation of Financial Position (Assets) Current assets decreased by ¥10,979 million compared with the end of the previous fiscal year, due mainly to a decrease in cash and deposits by ¥14,412 million, despite increases in notes and accounts receivable – trade by ¥2,503 million and merchandise and finished goods by ¥2,094 million. Non-current assets decreased by ¥1,266 million compared with the end of the previous fiscal year, due primarily to decreases in guarantee deposits by ¥797 million, deferred tax assets by ¥431 million, and land by ¥149 million, despite an increase in leased assets by ¥349 million. (Liabilities) Current liabilities decreased by ¥14,485 million compared with the end of the previous fiscal year, due mainly to decreases in short-term borrowings by ¥15,000 million and notes and accounts payable – trade by ¥2,784 million, despite increases in accrued expenses by ¥2,012 million and income taxes payable by ¥1,254 million. Non-current liabilities decreased by ¥447 million compared with the end of the previous fiscal year, due primarily to a decrease in long-term borrowings by ¥827 million, despite an increase in long-term lease obligations by ¥310 million. (Net assets) Net assets increased by ¥2,687 million compared with the end of the previous fiscal year, due mainly to an increase in retained earnings by ¥2,582 million. 2 (3) Explanation of Consolidated Financial Results Forecast and Other Future Projections There is no change to the consolidated financial results forecast announced on October 12, 2021. 3 As of February 28, 2021 As of November 30, 2021 (Millions of yen) 2. Consolidated Financial Statements (1) Consolidated Balance Sheets Assets Current assets Cash and deposits Notes and accounts receivable – trade Merchandise and finished goods Other Allowance for doubtful accounts Total current assets Non-current assets Property, plant and equipment Buildings and structures, net Other, net Total property, plant and equipment Intangible assets Investments and other assets Guarantee deposits Other Allowance for doubtful accounts Total investments and other assets Total non-current assets Total assets 63,088 7,310 9,709 1,858 (0) 81,966 6,078 1,599 7,677 549 12,925 5,347 (279) 17,992 26,220 108,186 48,675 9,814 11,804 692 (0) 70,986 6,000 1,794 7,795 459 12,127 4,842 (271) 16,698 24,954 95,940 4 As of February 28, 2021 As of November 30, 2021 (Millions of yen) Liabilities Current liabilities Notes and accounts payable – trade Short-term borrowings Current portion of long-term borrowings Income taxes payable Provision for bonuses Provision for point card certificates Provisions Other Total current liabilities Non-current liabilities Long-term borrowings Retirement benefit liability Provisions Asset retirement obligations Other Total non-current liabilities Total liabilities Net assets Shareholders’ equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders’ equity Accumulated other comprehensive income Valuation difference on available-for-sale securities Foreign currency translation adjustment Remeasurements of defined benefit plans Total accumulated other comprehensive income Non-controlling interests Total net assets Total liabilities and net assets 24,688 15,000 5,198 88 1,642 468 14 5,081 52,181 7,766 1,250 126 1,795 713 11,652 63,834 3,181 4,469 39,040 (2,172) 44,518 (0) (21) (144) (166) － 44,351 108,186 21,904 － 5,149 1,342 973 659 161 7,505 37,696 6,939 1,349 129 1,777 1,009 11,205 48,901 3,181 4,478 41,623 (2,173) 47,109 (0) (15) (129) (146) 75 47,038 95,940 5 (2) Consolidated Statements of Income and Comprehensive Income Consolidated Statements of Income Net sales Cost of sales Gross profit Selling, general and administrative expenses Operating profit Non-operating income Interest income Royalty income Rental income Foreign exchange gains Subsidy income related to COVID Other Total non-operating income Non-operating expenses Interest expenses Provision of allowance for doubtful accounts Share of loss of entities accounted for using equity Nine months ended November 30, 2020 method Other Total non-operating expenses Ordinary profit Extraordinary income Gain on sales of non-current assets Gain on sales of golf memberships Total extraordinary income Extraordinary losses Loss on retirement of non-current assets Impairment loss Total extraordinary losses Profit before income taxes Income taxes – current Income taxes – deferred Total income taxes Profit Loss attributable to non-controlling interests Profit attributable to owners of parent (Millions of yen) Nine months ended November 30, 2021 98,512 43,483 55,029 49,396 5,633 1 12 6 3 236 31 290 80 － 99 21 202 5,720 270 1 272 98 457 555 5,437 1,340 430 1,770 3,667 (13) 3,680 77,059 34,054 43,005 41,555 1,450 1 23 9 6 22 46 109 86 19 215 11 332 1,226 － － － 46 293 340 886 399 (105) 293 592 － 592 6 Consolidated Statements of Comprehensive Income Profit Other comprehensive income Valuation difference on available-for-sale Foreign currency translation adjustment Remeasurements of defined benefit plans, net of securities tax Share of other comprehensive income of entities accounted for using equity method Total other comprehensive income Comprehensive income Comprehensive income attributable to Comprehensive income attributable to owners of parent Comprehensive income attributable to non-controlling interests Nine months ended November 30, 2020 (Millions of yen) Nine months ended November 30, 2021 3,667 (0) 3 12 5 20 3,688 3,701 (13) 592 4 (0) 7 (13) (1) 591 591 － 7 3. Additional Information (1) Sales Results by Segment (Consolidated) Nine months ended November 30, 2020 Nine months ended November 30, 2021 Changes from the previous corresponding period Apparel Business Miscellaneous Goods/ Accessories Business Other Total million yen 54,414 22,593 51 77,059 million yen 62,984 35,456 71 98,512 % 115.8 156.9 137.1 127.8 (2) Status of Stores (Consolidated) Number of stores as of February 28, 2021 Number of new stores Number of closed stores Number of stores as of November 30, 2021 Nine months ended November 30, 2021 932 stores 43 stores 43 stores 932 stores 8