Heiwado Co., Ltd. · TSE:8276

Heiwado — Q2 FY2027/2 Earnings Presentation

46 slides from Heiwado's earnings presentation, Oct 1, 2026

  1. Slide 1: Financial Results Briefing

    Fiscal year ending Feb. 2027 (February 21, 2026 - August 20, 2026) Financial Results Heiwado Co., Ltd. (Securities Code 8276) Financial Results Briefing October 1 and 2, 2026 Note : This document has been translated from the Japanese original for reference purposes only. In the event of any discrepa

  2. Slide 2: Financial Results Summary

    Financial Results Summary Operating Revenue: Reached record highs (both consolidated and non-consolidated). Operating Profit: Declined due to non-consolidated sales and gross margin shortfalls. Ordinary Profit / Profit: Increased on a non-consolidated basis due to higher dividend income from consoli

  3. Slide 3: Q2 Performance Summary (Consolidated)

    February 2027, 2nd Quarter Performance Summary (Consolidated) ©2026 HEIWADO CO.,LTD. All rights reserved 2

  4. Slide 4: Consolidated Financial Results: Q2 FY2027/2

    Consolidated Financial Results: Q2 FY2027/2 [Unit：Millions of yen,％] Q2 FYE ⚫ Operating revenue grew due to higher net sales, Q2 FYE 2/2027 backed by existing-store growth in 2/2026 retail/restaurant segments and new store Results Results YoY Change contributions. Operating Revenue 223,539 230,489 1

  5. Slide 5: Performance: Key Consolidated Companies

    Performance: Key Consolidated Companies Performance of Key Companies: • Revenue/profit decline for total subsidiaries was due to the absorption of YELL and Yanagen into parent. • Surviving consolidated subsidiaries grew both revenue and profit. [Unit：Millions of yen,％] Operating Revenue Operating Pr

  6. Slide 6: Q2 Performance Summary (Non-Consolidated)

    February 2027, 2nd Quarter Performance Summary (Non-Consolidated) ©2026 HEIWADO CO.,LTD. All rights reserved 5

  7. Slide 7: Non-Consolidated Financial Results: Q2 FY2027/2

    Non-Consolidated Financial Results: Q2 FY2027/2 [Unit：Millions of yen,％] ⚫ Operating revenue grew due to higher net sales, Q2 FYE 2/2026 Q2 FYE 2/2027 backed by existing-store growth, new store contributions, and the absorption of Yell and Yanagen Results Results YoY Change into parent. Operating Re

  8. Slide 8: Non-Consolidated Analysis: Same-Store Sales Composition

    Non-Consolidated Analysis: Same-Store Sales Composition ⚫ Customer traffic increased due to higher visit frequency, supported by planned store renovations and effective merchandising initiatives. ⚫ Average spend per customer rose as average item prices increased, driven by ongoing food price hikes a

  9. Slide 9: Non-Consolidated Net Sales by Department

    Non-Consolidated Net Sales by Department ⚫ Strategic food pricing secured sales growth, with fresh foods led by seafood and meat. Grocery performance remained sluggish, affected by the non-recurrence of the prior-year surge in rice prices. ⚫ Apparel sales were significantly impacted by unseasonable

  10. Slide 10: Non-Consolidated Gross Profit Margin by Department

    Non-Consolidated Gross Profit Margin by Department ⚫ Gross profit failed to reach the target despite margin control measures addressing prior-year issues, impacted by the non-recurrence of the prior-year surge in rice demand and higher fresh food losses. Gross margin stabilized in Q2 and exceeded th

  11. Slide 11: Non-Consolidated Analysis: SG&A Expenses

    Non-Consolidated Analysis: Selling, General and Administrative Expenses ⚫ Out of the ¥3,655 million YoY increase in SG&A expenses, ¥1,907 million was due to new store impacts (¥1,057 million from 5 new stores and ¥849 million from Yell). ⚫ Out of the ¥1,880 million YoY increase in personnel expenses

  12. Slide 12: Progress of the 5th Medium-Term Management Plan

    Progress of the 5th Medium-Term Management Plan ©2026 HEIWADO CO.,LTD. All rights reserved 11

  13. Slide 13: Fifth Medium-Term Management Plan

    Fifth Medium-Term Management Plan Quantitative Targets for 2030 Operating Revenue (Consolidated) ¥500 billion or more Operating Profit Margin (Consolidated) 4.5% or more ROE 8.0% Percentage of Women in Management 20% or more CO2 Emissions 46% reduction (Scope 1 and 2) (compared to FYE 2/2014) 50% re

  14. Slide 14: Fifth Medium-Term Management Plan

    Fifth Medium-Term Management Plan Millions of yen Operating Revenue Operating Margin ％ 5,500 5.0 ① Increase Operating Revenue ・Dominant market expansion / renovations 5,000 ・Finalizing store formats 4.5 ・Driving footfall / focus on young families ・Reviving apparel & household goods 4,500 4.0 4,000 3

  15. Slide 15: 2030 Long-term Vision

    2030 Long-term Vision ⚫ Establishing and expanding the 'HOP Economic Zone' by leveraging our unique dominant model and a multi-format approach tailored to diverse consumer needs. ⚫ Further enhancing existing customer loyalty while driving deeper engagement with young families. Building Customer Domi

  16. Slide 16: Dominant Area Strategy

    Building Customer HOP Economic Cost Structure Dominant Area Strategy Allegiance Zone Reform Strengthening Dominance Through Planned New Store Openings for FY2/27 New Store Openings ◆AlplaFoodsMarket Toyama Kakeo store (Toyama) Opened Sep 18, 2026; total investment: ¥845 million H1 Food Sales in Kata

  17. Slide 17: Product and Merchandising Strategy

    Product and Merchandising Building Customer Allegiance HOP Economic Zone Cost Structure Reform Strategy Revitalizing Sales Floors Through Planned FY2/27 Renovations Store Renovations ◼ AL.PLAZA Daigo(Kyoto Pref.) FY2025 H2 Renovated Stores: H1 Food Sales [Unit：％] ◼ Adogawa Store(Shiga Pref.) Renovat

  18. Slide 18: Product and Merchandising Strategy

    Product and Merchandising Building Customer Allegiance HOP Economic Zone Cost Structure Reform Strategy Food Format (FMT) Transformation Average Monthly Food Sales <The Concept of Format Transformation> [Unit : Millions of yen] at FMT Transformation Stores Driving sustainable growth through operatio

  19. Slide 19: Product and Merchandising Strategy

    Product and Merchandising Building Customer Allegiance HOP Economic Zone Cost Structure Reform Strategy Improving Food Margins and Driving Customer Count ■Strengthening Sales of Key Value Items (KVIs) ■Strengthening Private Brand (PB) Products Q2 FYE Q2 FYE FYE Q2 FYE 2/2026 2/2027 2/2026 2/2027 Uni

  20. Slide 20: Creating a More Attractive Heiwado Group

    Creating a More Attractive Building Customer Allegiance HOP Economic Zone Cost Structure Reform Heiwado Group Optimizing Workforce Structure Empowering Associate Staff *Image for illustrative purposes Rising mandatory retirements ahead, alongside ongoing hiring challenges for new graduates... ➡Trans

  21. Slide 21: Creating a More Attractive Heiwado Group

    Creating a More Attractive Building Customer Allegiance HOP Economic Zone Cost Structure Reform Heiwado Group Utilizing Processing and Delicatessen Centers Taga Food Kumiyama Food Delicatessen Center Processing Center Processing Center （Mainly （Mainly Delicatessen） （Mainly Meat and Fish） Meat and Fi

  22. Slide 22: Creating a More Attractive Heiwado Group

    Creating a More Attractive Building Customer Allegiance HOP Economic Zone Cost Structure Reform Heiwado Group HOP Card, App & Money Rolled Out to Coco's & Sushi-dokoro Umiza in Shiga ➢ Expanding HOP member touchpoints beyond supermarkets to drive growth of the HOP Economic Zone. ➢ Supporting daily l

  23. Slide 23: Plan for the FYE 2/2027

    Plan for the FYE 2/2027 ©2026 HEIWADO CO.,LTD. All rights reserved 22

  24. Slide 24: Forecast for the FYE 2/2027

    Forecast for the FYE 2/2027 ⚫ Non-consolidated profit is projected to increase, driven by 5th Medium-Term Management Plan initiatives in "sales strength" and "productivity." We will refine gross margin and cost controls to address H1 challenges. ⚫ Executing strategic initiatives to secure our full-y

  25. Slide 25: Key Challenges for H1 FYE 2/2027

    Key Challenges for H1 FYE 2/2027 【Shortfall in operating revenue】 ¥(4,146) million vs. target 【Decline in gross profit margin】 (0.25)% YoY ＜Shortfall vs. Internal Budget＞ ＜YoY＞ ⚫ Grocery & Fresh Food total: ¥(3.3) billion ⚫ Processed Food：Gross margin dropped sharply by [Grocery: ¥(2.6) billion / Fr

  26. Slide 26: Forecast for the FYE 2/2027

    Forecast for the FYE 2/2027 【Operating Revenue Recovery】 【Improving Gross Margin】 ⚫ New Store Openings & Renovation ⚫ Strengthening Markup Rate Control Secure returns on stores: 8 renovations in 1H + Assortment adjustments and system 2 new stores, 7 renovations in 2H. utilization paid off, pushing A

  27. Slide 27: Forecast for the FYE 2/2027

    Forecast for the FYE 2/2027 【Investment & Expense Optimization】 ⚫ FYE 2/2027 New Stores ⚫ Disciplined Investment ⚫ Cost Optimization Review Current FY: 2 Stores Optimized Investment Cost Reduction via ROI 2H Prior Year: 4 Stores via Screening Evaluation ✓ 2H Prior Year: 4 new stores ✓ Strictly asses

  28. Slide 28: Notes.

    Notes. ⚫ This material is provided for informational purposes only and is not intended as a solicitation for any investment or action. While this material, including performance plans and future projections, has been prepared based on reliable information currently available, it inherently contains

  29. Slide 29: Supplementary Materials (Consolidated)

    Supplementary Materials (Consolidated) ©2026 HEIWADO CO.,LTD. All rights reserved 28

  30. Slide 30: Consolidated Operating Results Quarterly Changes for the FYE 2/2027

    Consolidated Operating Results Quarterly Changes for the FYE 2/2027 ⚫ Q1 operating revenue surpassed the prior-year level, driven by non- consolidated existing store growth and new store additions. ⚫ Q2 gross margin improved from Q1 but fell short of targets, while SG&A expenses and extraordinary lo

  31. Slide 31: Consolidated Results by Major Company

    Consolidated Results by Major Company Operating Profit & Ordinary Profit, Increase/Decrease Factors [Unit：Millions of yen] Operating Profit Ordinary Profit Increase/Decrease Factors Results YoY Results YoY Total Consolidated YoY Op. Revenue: -¥3,937M (Yell & Yanagen total) Subsidiaries 44,434 (826)

  32. Slide 32: Consolidated Analysis: SG&A Expenses

    Consolidated Analysis: Selling, General and Administrative Expenses ⚫ Personnel expenses increased by ¥1,006 million due to non-consolidated new store openings, performing in line with initial expectations. ⚫ Supplies expenses increased due to higher non-consolidated store renovations, expanding to

  33. Slide 33: Consolidated Statements of Cash Flows

    Consolidated Statements of Cash Flows 40,000 [Unit：Millions of yen] 30,000 166 20,000 ＋11,426 (9,217) (2,281) Profit before Income Taxes Capital Interest-Bearing ＋5,998 Investment-Related Debt-Related Non-Financial Profit and (9,215) (640) Loss Other Other 10,000 ＋7,227 (2) (1,640) Increase (Decreas

  34. Slide 34: Consolidated Key Financial Indicators

    Consolidated Key Financial Indicators ⚫ Operating revenue increased due to ongoing strategic pricing and other factors; however, SG&A growth outpaced gross profit, resulting in lower profit margins across the board. Q2 FYE 2/2026 Q2 FYE 2/2027 Operating Profit Margin(%) 3.1％ 2.5％ Ordinary Profit Mar

  35. Slide 35: Consolidated Capital Expenditure Plan for the FYE 2/2027

    Consolidated Capital Expenditure Plan for the FYE 2/2027 ⚫ Store Openings: 2 new stores planned for H2. ⚫ IT Investment: Expanding 'Network & Security' focus due to rising cyber risks; leveraging 'Information Integration Infrastructure' for data-driven management. ⚫ Subsidiaries: Capex increase driv

  36. Slide 36: Supplementary Materials (Non-Consolidated)

    Supplementary Materials (Non-Consolidated) ©2026 HEIWADO CO.,LTD. All rights reserved 35

  37. Slide 37: Non-Consolidated Financial Results Quarterly Changes for the FYE 2/2027

    Non-Consolidated Financial Results Quarterly Changes for the FYE 2/2027 ⚫ Q1 ordinary profit and subsequent income figures increased year-on-year, helped by dividend income from affiliated subsidiaries (eliminated in consolidation). ⚫ Q2 SG&A expenses and extraordinary losses increased, impacted by

  38. Slide 38: Non-Consolidated Net Sales Factors for Change

    Non-Consolidated Net Sales Factors for Change ⚫ (New Stores) FYE 2/2026 : 5 stores + 2 stores integrated from Yell. ⚫ (Store Closures) FY2/2026: 1 store + 2 external shops. [Unit：Millions of yen] 200,000 Other Household Apparel Other New Store (2,051) goods Closed 195,000 (254) ＋367 ＋7,523 Food Prod

  39. Slide 39: Non-Consolidated Net Sales by Region

    Non-Consolidated Net Sales by Region Same-Store Sales YoY [Unit：Millions of yen,％] Q2 FYE 2/2026 Q2 FYE 2/2027 Same-Store Stores Net Sales Stores Net Sales YoY Sales YoY Total for Stores 167 201,163 170 208,501 103.6 102.0 Shiga Pref. 81 82,708 84 86,155 104.2 100.5 Total for Keihanshin Region 44 68

  40. Slide 40: Supplementary Materials (Earnings Forecast)

    Supplementary Materials (Earnings Forecast) ©2026 HEIWADO CO.,LTD. All rights reserved 39

  41. Slide 41: Non-Consolidated Same-Store Sales Target YoY

    Non-Consolidated Same-Store Sales Target YoY ⚫ Progress on our 5th Medium-Term Management Plan allows us to project accelerated sales growth. ⚫ Our plan to renovate approximately 8 stores in H1 and 7 stores in H2 is designed to drive revenue growth across existing locations. [Unit：％] Q1 Q2 Q3 Q4 103

  42. Slide 42: Non-Consolidated September 2026 Net Sales by Department

    Non-Consolidated September 2026 Net Sales by Department ※Sep: +1 Sunday, +1 National Holiday vs. PY ⚫ All Stores (YoY): Existing Store Customer Count 101.0%, Average Spend 104.0%, Items Purchased 98.7%, Average Item Price 105.4%. ⚫ Food: Rain reduced customer count, but Perishables (Meat & Seafood)

  43. Slide 43: Action to Implement Management Conscious of Cost of Capital and Stock Price

    Action to Implement Management that is Conscious of Cost of Capital and Stock Price ©2026 HEIWADO CO.,LTD. All rights reserved 42

  44. Slide 44: Engagement with Investors

    Engagement with Investors ⚫ The content of the dialogues with investors is fed back to the Board of Directors. ⚫ We actively welcome inquiries from institutional investors to enhance communication. ⚫ We are preparing to facilitate a higher volume of company briefing sessions for individual investors

  45. Slide 45: Shareholder Return Policy

    Shareholder Return Policy FYE FYE FYE FYE FYE FYE FYE 2/2021 2/2022 2/2023 2/2024 2/2025 2/2026 2/2027 Net Profit 9,724 10,647 7,516 6,774 10,727 9,409 9,800 (Millions of yen) Dividend per Share 38 42 42 42 63 66 66 (yen) Dividend Payout 20.5 20.7 29.3 32.5 30.1 34.9 33.3 Ratio (%) ⚫ For the FYE 2/2

  46. Slide 46: HEIWADO

    HEIWADO HASH ENS

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