キュービーネットホールディングス（6571） – [Delayed]Financial Results for the Third Quarter of the Fiscal Year Ending June 30, 2022 [IFRS] (Consolidated)

Financial Results for the Third Quarter of the Fiscal Year Ending June 30, 2022 [IFRS] (Consolidated) Company name: QB Net Holdings Co., Ltd. Code number: 6571 Representative: Yasuo Kitano, President CEO Listed on: Tokyo Stock Exchange URL: http://www.qbnet.jp/ Contact: Osamu Matsumoto, Director and General Manager of Administration Department May 13, 2022 Tel.: +81-3-6418-9190 Scheduled date of quarterly report submission: May 13, 2022 Scheduled date for commencement of dividend payment: — Supplementary explanatory materials for quarterly financial results: Yes Quarterly financial results briefings: Yes (Rounded down to the nearest million yen) 1. Consolidated Financial Results for the Third Quarter of the Fiscal Year Ending June 30, 2022 (July 1, 2021 to March 31, 2022) (1) Consolidated Operating Results (Cumulative) (Percentages indicate changes from the same period of the previous fiscal year.) Revenue Operating profit Profit before tax Profit Profit attributable to owners of parent Total comprehensive income Q3 FYE June 2022 Q3 FYE June 2021 million yen 14,992 13,951 % million yen 901 7.5 281 (13.7) % million yen 788 146 220.4 (79.2) % million yen 519 160 439.0 (88.3) % million yen 519 160 222.9 (80.6) 222.9 (80.6) % million yen %662 175.5 (71.0)240 Q3 FYE June 2022 Q3 FYE June 2021 Basic earnings per share Diluted earnings per share yen 40.42 12.61 yen 38.87 12.07 (2) Consolidated Financial Position Total assets Total equity Equity attributable to owners of parent Ratio of equity attributable to owners of parent Q3 FYE June 2022 FYE June 2021 million yen 30,143 30,634 million yen 10,862 10,156 million yen 10,862 10,156 End-Q1 End-Q2 End-Q3 Year-end Total Annual dividends yen – – yen 0.00 0.00 yen – – (Note) 1. Revision from the last announcement of dividend forecast: Yes 2. For a revision of the forecast of the year-end dividend for the fiscal year ending June 30, 2022, please refer to “Notice of Revision of Dividend Forecast” announced today (May 13, 2022). 3. Consolidated Earnings Forecast for the Fiscal Year Ending June 30, 2022 (July 1, 2021 to June 30, 2022) (Percentages indicate changes from the previous fiscal year.) Revenue Operating profit Profit before tax Profit Full year (Note) million yen 20,840 % million yen 1,100 10.1 % 137.3 million yen % million yen % million yen 920 221.2 640 162.4 yen 49.09 Revision from the last announcement of earnings forecast: No Basic earnings per share Profit attributable to owners of parent % 640 162.4 % 36.0 33.2 yen 0.00 9.00 yen 0.00 9.00 2. Dividends FYE June 2021 FYE June 2022 FYE June 2022 (Forecast) – 1 – * Notes (1) Changes in significant subsidiaries during the period: No (Changes in specific subsidiaries with changes in the scope of consolidation) Newly consolidated – companies (Company names) -, Excluded – companies (Company names) – (2) Changes in accounting policies and accounting estimates (i) Changes in accounting policies required by IFRS: No (ii) Changes in accounting policies other than (i): No (iii) Changes in accounting estimates: No (3) Number of shares outstanding (common stock) (i) Number of shares outstanding at the end of the period (including treasury Q3 FYE June 2022 12,893,700 shares FYE June 2021 12,820,900 shares shares) (ii) Number of treasury shares at the end of the period (iii) Average number of shares outstanding during the period (cumulative) Q3 FYE June 2022 123 shares FYE June 2021 123 shares Q3 FYE June 2022 12,861,008 shares Q3 FYE June 2021 12,762,530 shares * Quarterly financial results are not subject to quarterly review by certified public accountants or audit firms. * Explanation on the appropriate use of earnings forecasts and other special notes (Notes on forward-looking statements) Forward-looking statements and others included in this document, including earnings forecasts, are based on information currently available to and certain premises deemed to be rational by the Company, and it is not committed to achieving such. Actual earnings and others may differ due to various factors. (How to obtain supplementary explanatory materials for financial results) Supplementary explanatory materials for financial results were disclosed on TDnet on the same day and will also be posted on the Company website. – 2 – Table of Contents for the Attachment 1. Qualitative Information Regarding the Quarterly Financial Results Under Review ……………………………………………………………. 4 (1) Explanation of Operating Results ………………………………………………………………………………………………………………….. 4 (2) Explanation of Financial Position ………………………………………………………………………………………………………………….. 5 (3) Explanation of Information on Future Forecasts Including Consolidated Earnings Forecast ………………………………………….. 6 2. Condensed Quarterly Consolidated Financial Statements and Main Notes ………………………………………………………………………. 7 (1) Condensed Quarterly Consolidated Statement of Financial Position ……………………………………………………………………….. 7 (2) Condensed Quarterly Consolidated Statement of Profit or Loss …………………………………………………………………………….. 8 (3) Condensed Quarterly Consolidated Statement of Comprehensive Income ………………………………………………………………… 9 (4) Condensed Quarterly Consolidated Statement of Changes in Equity ……………………………………………………………………… 10 (5) Condensed Quarterly Consolidated Statement of Cash Flows ……………………………………………………………………………… 12 (6) Notes on the Condensed Quarterly Consolidated Financial Statements ………………………………………………………………….. 13 – 3 – 1. Qualitative Information Regarding the Quarterly Financial Results Under Review (1) Explanation of Operating Results During the consolidated first nine months of the fiscal year under review (from July 1, 2021 to March 31, 2022), the Company Group has operated its stores while taking all possible measures to prevent infections amid the impact of new coronavirus infections (hereinafter referred to as “COVID-19”) persisting for a long time. Revenue increased 1,041 million yen year on year to 14,992 million yen despite the continued impact of COVID-19. The status of COVID-19 and its impact on revenue in each country is as described below. Cumulative Q3 of previous fiscal year (From July 1, 2020 to March 31, 2021) Cumulative Q3 of current fiscal year (From July 1, 2021 to March 31, 2022) Changes (Million yen) Changes (Excluding foreign exchange effects) – 100 940 (94) 2,388 2,489 11,562 12,502 (89) (20) (45) 62 (94) 8 27 (3) 67 1,041 1,297 652 400 138 14,992 1,289 625 403 70 13,951 Hong Kong Singapore Taiwan United States Domestic operations Overseas operations Consolidated (Note) Amounts are after deducting intercompany transactions among group companies. A state of emergency was declared in July 2021, and semi-emergency coronavirus measures were also put in effect in January 2022. However, the Group continued business with infection-preventive measures and hygiene control practiced thoroughly. Revenue increased 940 million yen year on year. The background is the facts that the number of salons with shortened business hours decreased and the number of customers visiting our salons, mainly seniors, started picking up as foot traffic increased due to the easing of the self-restraint atmosphere resulting from a rise in the vaccination rate. Revenue increased 8 million yen year on year due to foreign exchange effects associated with a depreciation of the yen although the number of customers visiting our salons declined as the number of new infections rose temporarily. Revenue increased 27 million yen year on year due to foreign exchange effects associated with a depreciation of the yen although the number of customers visiting our salons declined as the impact of teleworking and self-restraints on outings lingered in some regions. Revenue decreased 3 million yen year on year including foreign exchange effects associated with a depreciation of the yen as the number of customers visiting our salons declined with the number of new infections on the rise. As the number of new infections is on a downward trend, the number of customers visiting our salons has recovered. Revenue increased 67 million yen year on year partly due to price revisions including foreign exchange effects associated with a depreciation of the yen. Cost of sales decreased 96 million yen year on year to 12,225 million yen. The main changes are as follows. (Million yen) Item Changes Main reasons for change Personnel expenses Outsourcing fees Depreciation (salons subject to impairment) Consumables(cost of combs) (59) A decrease in the number of store stylists due to the optimization of personnel 81 An increase in revenue at consigned salons (57) Decrease due to salon impairment in the previous fiscal year (47) A decrease in the purchase number due to the start of the reuse of combs – 4 – (Million yen) Selling, general and administrative expenses fell 74 million yen year on year to 1,879 million yen. The main changes are as follows. Item Changes Main reasons for change Personnel expenses Advertising expenses (73) A decrease in in-house haircut school trainees and staff in the head office Increase in sales promotion expenses at the time of opening salons due to an increase in the number of openings 11 Other operating income was 65 million yen, down 637 million yen from the same period of the previous fiscal year when we recorded income from employment adjustment subsidies in Japan. Other operating expenses decreased 45 million yen year on year to 51 million yen. As a result, consolidated earnings in the first nine months of the fiscal year under review were as follows: Revenue amounted to 14,992 million yen (up 7.5% year on year), operating profit was 901 million yen (up 220.4% year on year), profit before tax was 788 million yen (up 439.0% year on year), and profit attributable to owners of parent came to 519 million yen (up 222.9% year on year). In terms of our store network, we opened 22 stores. The breakdown was 19 stores in Japan (including four relocations), and overseas, one in Hong Kong, Taiwan and the U.S., respectively. There was a total of 16 closures. The breakdown was, in Japan, eight closures due to train station redevelopment and renovation of facilities housing our salons (including two stores already relocated), and overseas, eight closures mainly due to consolidation of stores associated with a review of location evaluation in consideration of the impact of the pandemic. As a result, the number of stores at the end of the third quarter of the fiscal year under review increased by six from the end of the previous fiscal year to 720. The description by segment is omitted because the Company Group engages in a single segment of the haircutting business. (2) Explanation of Financial Position (i) Assets, liabilities and equity Assets, liabilities and equity at the end of the third quarter under review were as follows: Current assets decreased 459 million yen from the end of the previous fiscal year to 5,181 million yen. This was mainly due to a decrease of 581 million yen in cash and cash equivalents and an increase of 78 million yen in trade and other receivables. Non-current assets decreased 31 million yen from the end of the previous fiscal year to 24,961 million yen. This was mainly due to a decrease of 92 million yen in property, plant and equipment and an increase of 72 million yen in other financial assets. As a result, assets decreased 490 million yen from the end of the previous fiscal year to 30,143 million yen. Current liabilities decreased 709 million yen from the end of the previous fiscal year to 6,990 million yen. This was mainly due to a decrease of 989 million yen in borrowings and an increase of 224 million yen in income taxes payable. Non-current liabilities decreased 487 million yen from the end of the previous fiscal year to 12,290 million yen. This was mainly due to a decrease of 514 million yen in borrowings and an increase of 26 million yen in provisions. As a result, liabilities decreased 1,196 million yen from the end of the previous fiscal year to 19,281 million yen. Equity increased 705 million yen from the end of the previous fiscal year to 10,862 million yen. This was mainly due to an increase of 519 million yen in retained earnings. (ii) Cash flows Cash and cash equivalents (hereinafter referred to as “cash”) at the end of the third quarter under review decreased 581 million yen from the end of the previous fiscal year to 4,020 million yen. Individual cash flows for the first nine months of the fiscal year under review and the factors behind them were as follows: (Cash flows from operating activities) Cash provided by operating activities was 3,122 million yen (2,884 million yen provided in the same period of the previous fiscal year). This was mainly attributable to factors causing an increase in cash, such as the recording of profit before tax of 788 million yen and depreciation and amortization of 2,393 million yen, in contrast to decreasing factors, such as interest paid of 93 million yen. (Cash flows from investing activities) Cash used in investing activities was 373 million yen (327 million yen used in the same period of the previous fiscal year). This was mainly attributable to factors causing a decrease in cash, such as purchase of property, plant and equipment of 275 million yen and payments of guarantee deposits of 82 million yen. – 5 – (Cash flows from financing activities) Cash used in financing activities was 3,443 million yen (3,464 million yen used in the same period of the previous fiscal year). This was mainly attributable to factors causing a decrease in cash, such as net decrease in short-term borrowings of 1,000 million yen and repayments of lease obligations of 2,011 million yen. (3) Explanation of Information on Future Forecasts Including Consolidated Earnings Forecast Regarding the financial forecast for the fiscal year ending June 30, 2022, there is no change to the full-year financial forecast announced on August 13, 2021. Forward-looking statements and others included in this document, including earnings forecasts, are based on information available to and certain premises deemed to be rational by the Company, and actual results and others may vary considerably from the above forecasts due to various factors. – 6 – 2. Condensed Quarterly Consolidated Financial Statements and Main Notes (1) Condensed Quarterly Consolidated Statement of Financial Position Previous fiscal year (June 30, 2021) Q3 of current fiscal year (March 31, 2022) (unit: million yen) Assets Current assets Cash and cash equivalents Trade and other receivables Other financial assets Inventories Income taxes receivable Other current assets Total current assets Non-current assets Property, plant and equipment Right-of-use assets Goodwill Intangible assets Other financial assets Deferred tax assets Other non-current assets Total non-current assets Total assets Liabilities and equity Liabilities Current liabilities Trade and other payables Borrowings Lease obligations Income taxes payable Other financial liabilities Other current liabilities Total current liabilities Non-current liabilities Borrowings Lease obligations Other financial liabilities Deferred tax liabilities Provisions Other non-current liabilities Total non-current liabilities Total liabilities Equity Share capital Capital surplus Retained earnings Treasury shares Other components of equity Total equity attributable to owners of parent Total equity Total liabilities and equity – 7 – 4,601 781 – 104 23 129 5,641 1,502 5,313 15,430 130 1,854 654 107 24,992 30,634 202 3,717 2,350 47 82 1,299 7,699 9,125 3,016 91 15 514 13 12,777 20,477 1,245 4,785 4,129 (0) (3) 10,156 10,156 30,634 4,020 860 7 95 – 197 5,181 1,410 5,268 15,430 121 1,926 676 128 24,961 30,143 281 2,728 2,288 271 101 1,318 6,990 8,611 3,006 83 36 541 10 12,290 19,281 1,272 4,811 4,649 (0) 129 10,862 10,862 30,143 (2) Condensed Quarterly Consolidated Statement of Profit or Loss First nine months of previous fiscal year (From July 1, 2020 to March 31, 2021) First nine months of current fiscal year (From July 1, 2021 to March 31, 2022) (unit: million yen) Other operating income Selling, general and administrative expenses Other operating expenses Revenue Cost of sales Gross profit Operating profit Finance income Finance costs Profit before tax Income tax expense Profit attributable to Owners of parent Profit Profit Earnings per share Basic earnings per share (yen) Diluted earnings per share (yen) 14,992 (12,225) 2,766 65 (1,879) (51) 901 10 (123) 788 (268) 519 519 519 40.42 38.87 13,951 (12,321) 1,629 703 (1,953) (97) 281 9 (144) 146 14 160 160 160 12.61 12.07 – 8 – (3) Condensed Quarterly Consolidated Statement of Comprehensive Income Profit Other comprehensive income Items that may be reclassified to profit or loss Exchange differences on translation of foreign operations Total of items that may be reclassified to profit or loss Total other comprehensive income Comprehensive income Comprehensive income attributable to Owners of parent Comprehensive income (unit: million yen)First nine months of previous fiscal year (From July 1, 2020 to March 31, 2021) First nine months of current fiscal year (From July 1, 2021 to March 31, 2022) 160 79 79 79 240 240 240 519 142 142 142 662 662 662 – 9 – (4) Condensed Quarterly Consolidated Statement of Changes in Equity First nine months of previous fiscal year (From July 1, 2020 to March 31, 2021) Share capital Capital surplus Retained earnings Treasury shares (unit: million yen)Other components of equity Exchange differences on translation of foreign operations Share acquisition rights Total Balance at July 1, 2020 1,214 4,754 3,885 (0) (179) 110 (68) Profit Other comprehensive income Total comprehensive income Issuance of new shares (exercise of share acquisition rights) Share-based remuneration expenses 15 15 160 160 – – – – – – – – – – – 79 79 – – – – – – (8) 11 2 Total transactions with owners 15 15 Balance at March 31, 2021 1,230 4,770 4,046 (0) (99) 113 – 79 79 (8) 11 2 14 (unit: million yen)Total equity Total equity attributable to owners of parent Balance at July 1, 2020 9,786 9,786 Profit Other comprehensive income Total comprehensive income Issuance of new shares (exercise of share acquisition rights) Share-based remuneration expenses Total transactions with owners Balance at March 31, 2021 10,061 10,061 – – – – 160 79 240 22 11 34 – – – – 160 79 240 22 11 34 – 10 – First nine months of current fiscal year (From July 1, 2021 to March 31, 2022) Share capital Capital surplus Retained earnings Treasury shares (unit: million yen)Other components of equity Exchange differences on translation of foreign operations Share acquisition rights Total Balance at July 1, 2021 1,245 4,785 4,129 (0) (110) 107 519 519 – – – – – – – – – – – 142 142 – – – – – – (14) 4 (10) 97 Total transactions with owners 26 26 Balance at March 31, 2022 1,272 4,811 4,649 (0) 32 (3) – 142 142 (14) 4 (10) 129 Profit Other comprehensive income Total comprehensive income Issuance of new shares (exercise of share acquisition rights) Share-based remuneration expenses 26 26 (unit: million yen)Total equity Total equity attributable to owners of parent Balance at July 1, 2021 10,156 10,156 Profit Other comprehensive income Total comprehensive income Issuance of new shares (exercise of share acquisition rights) Share-based remuneration expenses Total transactions with owners Balance at March 31, 2022 10,862 10,862 – – – – 519 142 662 38 4 42 – – – – 519 142 662 38 4 42 – 11 – (5) Condensed Quarterly Consolidated Statement of Cash Flows First nine months of previous fiscal year (From July 1, 2020 to March 31, 2021) First nine months of current fiscal year (From July 1, 2021 to March 31, 2022) (unit: million yen) 788 2,393 43 (10) 123 (30) (51) 12 (4) (35) 3,229 0 (93) 30 29 (74) 3,122 (275) (27) (82) 27 (17) (373) (1,000) (525) 55 (2,011) 38 (0) (3,443) 113 (581) 4,601 4,020 146 2,462 92 (9) 144 (674) (15) 36 (31) 39 2,191 0 (115) 619 271 (83) 2,884 (303) (10) (42) 32 (4) (327) (1,000) (525) 55 (2,017) 22 (0) (3,464) 62 (844) 5,117 4,272 Cash flows from operating activities Profit before tax Depreciation and amortization Impairment losses Finance income Finance costs Subsidy income Decrease (increase) in trade and other receivables Decrease (increase) in inventories Increase (decrease) in trade and other payables Other Subtotal Interest received Interest paid Proceeds from subsidy income Income taxes refund Income taxes paid Cash flows from operating activities Cash flows from investing activities Purchase of property, plant and equipment Purchase of intangible assets Payments of guarantee deposits Proceeds from refund of guarantee deposits Other Cash flows from investing activities Cash flows from financing activities Net increase (decrease) in short-term borrowings Repayments of long-term borrowings Proceeds from sale and leaseback transactions Repayments of lease obligations Proceeds from exercise of share acquisition rights Dividends paid Cash flows from financing activities Exchange differences of cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at beginning of period Cash and cash equivalents at end of period – 12 – (6) Notes on the Condensed Quarterly Consolidated Financial Statements (Notes on going concern assumption) There are no applicable items. (Additional information) There are no changes to the assumptions, including the timing of the end of COVID-19, from those described in the consolidated financial statements for the previous fiscal year. The description is omitted because the Company Group engages in a single segment of the haircutting business. Basis of the calculation of basic and diluted earnings per share is as follows: (Segment information) (Per share information) First nine months of previous fiscal year (From July 1, 2020 to March 31, 2021) First nine months of current fiscal year (From July 1, 2021 to March 31, 2022) Profit attributable to owners of parent (million yen) Average number of common shares outstanding during the period (shares) Number of common shares with dilutive effects Increase due to share options (shares) Diluted average number of common shares outstanding during the period (shares) Basic earnings per share (yen) Diluted earnings per share (yen) (Significant subsequent events) There are no applicable items. 160 12,762,530 575,552 13,338,082 12.61 12.07 519 12,861,008 514,937 13,375,945 40.42 38.87 – 13 –