Performance Trend 1. Overview of performance for FY3/2024 Consolidated performance for FY3/2024 of G-7 Holdings <7508> was 192,992 million yen in increased operating income of 9.1% over the previous year, and increased ordinary income of 7.4% to 7,318 million yen, and attributed to the parent company's net income of 5,175 million yen, an increase of 35.3% over the previous year. Sales were driven by the Business Supermarket Business and the Meat Business, and continued to set a new record high, exceeding the company's plan by 4.3%. However, in terms of profits, the automobile-related business was affected by a decrease in profits due to poor sales of winter tires due to a warm winter, and could not reach the company's plan, it turned to a profit increase for the second time due to the growth of other businesses centered on the Business Supermarket business. The sales cost ratio has increased by 0.8 points over the previous year due to changes in the sales composition ratio; however, the selling, general and administrative expense ratio decreased by 0.7 points due to the effect of increased earnings, and the operating margin decreased by 0.1 points to 3.6%. The main reasons for the increase/decrease of selling, general and administrative expenses were a decrease of 600 million yen in energy costs due to subsidies from rising electricity prices, and an increase of 1 billion yen in labor costs due to improvements in employee treatment and increased education costs. In addition to this, depreciation expenses increased by nearly 600 million yen due to rising construction material costs and rising costs of opening stores etc. The EBITDA margin has increased by 0.1 points from the previous year. Also, the reason for the large increase in the net income of the parent company's shareholders attributable to the current period is due to the elimination of 500 million yen in retirement benefits paid to executives that were recorded as special losses in the previous year, a decrease of 455 million yen in impairment losses, and a gain of 127 million yen on the sale of investment securities in FY3/2024.

2. Financial condition and performance indicators.

Looking at the financial situation of Aoba-BBT＜2464＞ at the end of the fiscal year ending March 2024, total assets decreased by ¥1,127 million to ¥7,491 million compared to the previous year-end. The main factors of increase and decrease show a decrease of ¥926 million in cash and deposits in current assets. In fixed assets, tangible fixed assets decreased by ¥312 million, and goodwill decreased by ¥145 million, respectively.

Total liabilities decreased by ¥896 million to ¥2,716 million compared to the previous year-end. Interest-bearing debt decreased by ¥68 million, while accounts payable decreased by ¥255 million, corporate income tax payable decreased by ¥294 million, and the special founder's honor reserve decreased by ¥237 million. Total net assets decreased by ¥230 million to ¥4,774 million compared to the previous year-end. Net income attributable to parent company shareholders amounted to ¥242 million, while dividend payments of ¥222 million and a decrease of ¥256 million due to repurchase of treasury stock were contributing factors.

Looking at the indicators, the equity ratio increased from 57.8% to 63.3% due to the decrease in liabilities. With an interest-bearing debt ratio of 2.9% at a low level, the financial soundness is considered to be maintained. However, in terms of profitability, the revenue operating margin is 5.1%, roe is 5.0%, and roa is 4.8%, all remaining at around 5%, indicating that improving profitability is a future challenge.

(Written by FISCO guest analyst, Jo Sato)