Impact of COVID-19 on Business and Consumer Activity

「Although COVID-19 (hereinafter, COVID-19) was reclassified as a Class 5 infectious disease and social and economic activity began to recover, all reportable segments posted revenue growth amid continued uncertainty, including soaring global raw-material prices and the sharp depreciation of the yen, which heightened consumers' concerns about protecting their livelihoods.」

「The Developer Business and Services and Specialty Stores Business posted higher profits as customer traffic recovered compared with the period during the COVID-19 pandemic.」

「Although COVID-19 (hereinafter, COVID-19) was reclassified as a Class 5 infectious disease and social and economic activity began to recover, all reportable segments posted revenue growth amid continued uncertainty, including soaring global raw-material prices and the sharp depreciation of the yen, which heightened consumers' concerns about protecting their livelihoods.」

「Domestic social and economic activity began to show signs of recovery as restrictions on activities were eased and the government's tourism support measures took effect following the spread of COVID-19 (hereinafter, COVID-19).」

「Losses related to the response to the infectious disease amounted to ¥1,381 million.」

「These losses arose from temporary closures. The main components were as follows: employee salaries and allowances during the closure period, ¥853 million; fixed costs related to stores and other facilities during the closure period, ¥5,524 million; other, ¥157 million; total, ¥6,536 million.」

「These losses arose from temporary closures. The main components were as follows: employee salaries and allowances during the closure period, ¥753 million; fixed costs related to stores and other facilities during the closure period, ¥5,052 million; other, ¥139 million; total, ¥5,944 million.」

「During the six-month period ended in the second quarter, the areas covered and the scope of restrictions were limited compared with the same period of the previous year. However, the external environment was more severe than initially expected, due to constraints including temporary closures, shortened business hours and entry restrictions, as well as prolonged calls for people to refrain from going out following the rapid spread of variants and weaker consumer sentiment.」

「During the first-quarter consolidated cumulative period, some local authorities issued states of emergency and priority preventive measures to prevent the spread of disease, and we implemented temporary closures and reduced operating hours. However, because the affected regions and restrictions were limited compared with the restrictions on activity imposed in Japan and overseas during the previous first-quarter consolidated cumulative period, and because the Group promoted thorough infection-control measures and adaptation to the new normal under COVID-19, performance recovered significantly in the GMS (general merchandise store), Integrated Financial Services, Developer, and Services and Specialty Stores businesses.」

「Temporary store closures and reduced operating hours due to the spread of COVID-19, rent reductions for tenant specialty-store companies that are important business partners, inventory reductions to improve operating efficiency and other factors resulted in a net loss attributable to owners of the parent of ¥71,024 million for the fiscal year.」

「Although performance was significantly affected during the first-quarter consolidated accounting period, it gradually recovered thereafter. In the second-quarter consolidated accounting period, revenue turned upward and the decline in profit narrowed. During the third-quarter consolidated accounting period, the SM (supermarket) and Health and Wellness businesses remained strong, while the GMS (general merchandise store) and Integrated Financial Services businesses turned toward improved profitability.」

「Due to the global spread of COVID-19, restrictions on activity, including states of emergency, were imposed in Japan and overseas, and malls, stores and offices in Japan and overseas were temporarily closed or operated with reduced hours, mainly during the first-quarter consolidated accounting period. As a result, the performance of the Developer, Services and Specialty Stores, and Integrated Financial Services businesses was significantly affected, while the GMS business was also affected by calls for people to refrain from going out.」

「During the period, restrictions on activity, including states of emergency, were imposed in Japan and overseas due to the global spread of COVID-19. In response to requests from government and other relevant authorities, we temporarily closed or shortened operating hours at malls, stores and offices in Japan and overseas as infection-control measures. This affected the performance of the Developer, Services and Specialty Stores, and Integrated Financial Services businesses, as well as the GMS business due to calls for people to refrain from going out.」

「Since reports of COVID-19 infections first emerged in Wuhan, Hubei Province, the People's Republic of China, in December 2019, reports of rising infection numbers have continued worldwide. The spread of infection has also continued in Asia, including Japan, where the Group operates, making an impact on sales activities and other business activities unavoidable.」