Lawson formulated the Challenge 2025 medium-term vision to mark our 50th anniversary in that same year. Seeking to achieve that vision under the guidance of the Lawson Group Sweeping Transformation Executive Committee established in September 2020, we have been working to renovate stores and refresh our product mixes to better respond to changes in our business environment. We have also been striving to solve medium- to long-term issues, secure new revenue-generating opportunities, and improve job satisfaction and enthusiasm in pursuit of sustainable growth across the Lawson Group.

As a result of these efforts, both consolidated net sales from convenience stores and gross operating revenue increased year on year in first nine months of FY2021 from February through November 2021, with consolidated net sales from convenience stores totaling 1.8434 trillion yen (+4.1% year on year), consolidated gross operating revenue totaling 522.4 billion yen (+5.0%), and consolidated net income totaling 24.3 billion yen (+104.8%). Meanwhile, existing-store sales in Japan increased by 1.2% year on year in the first nine months.

The main topics in the FY2021 third-quarter corporate results are detailed below:

At our Japanese convenience store business, people flows gradually started to recover following the nationwide lifting of the COVID-19-related state of emergency in October and the easing of measures to prevent the spread of infection, as well as the relaxation of restrictions on social activities. We decided to use these changes in our new-normal business environment as an opportunity to develop stores that better serve customer demand and to pursue tailored store renovations that suit local conditions. In addition, franchise store profits increased year on year thanks to efforts to ensure appropriate business expenses and strengthen product ranges. In terms of store numbers, in the first nine months of FY2021, Lawson opened 401 stores and closed 180 stores, resulting in a net increase of 221 stores and a total number of 14,697 convenience stores in Japan at the end of November 2021.

•We completed the renovation of 1,669 stores by the end of November 2021 and expanded the range of products for everyday life, such as frozen foods and daily foods, as well as strengthened product appeal in the rice, cooked noodles, and over-the-counter fast food categories, and through our Machikado Chubo in-store kitchen service.

•We increased the number of stores with a Machikado Chubo Kitchen to 7,464 stores by the end of November 2021. We scaled up our efforts to meet growing food demand by providing food products developed in collaboration with restaurants and our Local Rice Bowl series designed to satisfy local needs.

•We are steadily increasing the number of stores offering food delivery services. In September, we introduced delivery service menus and, by the end of November, 2,492 stores in 41 prefectures were able to offer food deliveries through a total of five delivery services, including Uber Eats. Furthermore, the number of stores asking Uber Eats to also handle the delivery of over-the-counter drugs rose to 51 stores in 12 prefectures.

•In terms of original products, customers appreciated our efforts to develop products that provide new value and meet customer needs. Sales increased particularly strongly for our new “GATEAU CHOCOLAT” released in September and our new “Crispy Fried Chicken” over-the-counter fast food product that we started selling in October.

•We were the first to start selling mineral water in cartons as a private brand product in November. In addition to reducing the amount of plastic we use, we are also engaging in persistent decarbonization activities.

Regarding our Seijo Ishii business, existing-store sales in the first nine months of FY2021 rose year on year thanks to continued strong sales of our own original deli items manufactured in our in-house Central Kitchen. Seijo Ishii also introduced Coalition Loyalty program Ponta in five stores on November 15.

Our entertainment-related business enjoyed a recovery in ticket handling volumes as more concerts and sports events were held following the lifting of the state of emergency. In addition, our cinema complex business picked up as all cinemas reopened for regular business.

In our financial services business, an increase in the number of ATM charges for cashless payment services along with our new alliances with Shinkin Banks helped increase ATM usage.

Looking at our overseas business, the number of international stores had increased by 984 year on year to 4,605 stores at the end of November 2021. Of that total, we expanded the number of new stores opened as well as the geographical reach of our stores in China, which resulted in an increase of 968 to a total 4,312 stores in China at the end of November. We are working to expand profits along with our efforts to enhance our brand image and brand recognition.

We intend to continue renovating stores under the guidance of the Sweeping Transformation Executive Committee and bring the total number of refurbished convenience stores in Japan for the full fiscal year up to as many as 5,000 stores. Furthermore, in addition to increasing the number of stores with Machikado Chubo in-store kitchens to 8,400 stores, we will work to expand our product lineup and strengthen our product appeal. We will also work to expand business in our other segments and seek, as a united Group, to achieve our full-year forecasts.

In light of the latest business conditions and performance, we have made no changes to our full-year predictions for consolidated operating income of 50.0 billion yen, consolidated net income of 15.5 billion yen, and a 150 yen dividend per share.

We very much appreciate the understanding extended by our shareholders and investors for our policies and hope we can count on your continued support.