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    8267   JP3388200002

AEON CO., LTD.

(8267)
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Aeon : (Delayed) Financial Results for the Fiscal Year ended February 28, 2021

04/27/2021 | 02:35am EDT

This is an abridged translation of the original Japanese document and is provided for informational purposes only. If there are any discrepancies between this and the original, the original Japanese document prevails.

Financial Results for the Fiscal Year ended February 28, 2021

April 9, 2021

Company name

Aeon Co., Ltd.

Listings

The First Section of Tokyo Stock Exchange

Security code

8267

URL

http://www.aeon.info/en/

Representative

Akio Yoshida, President

Contact

Takeshi Miyazaki

Chief Officer, Finance and Accounting

Telephone

+81 43-212-6042

Scheduled dates:

Ordinary general meeting of shareholders Commencement of dividend payments Submission of statutory financial report

Supplementary materials to the financial results Fiscal year-end earnings results briefing

May 26, 2021

April 30, 2021

May 27, 2021

Available

Yes (targeted at institutional investors and analysts)

(Amounts rounded down to the nearest million)

1. Consolidated Financial Results for the Fiscal Year ended February 28, 2021

(March 1, 2020 to February 28, 2021)

(1) Operating Results

(Percentage figures represent year-on-year changes)

Operating revenue

Operating profit

Profit (loss)

Ordinary profit

attributable to

owners of parent

Year ended February

million yen

%

million yen

%

million yen

%

million yen

%

8,603,910

(0.0)

150,586

(30.1)

138,801

(32.6)

(71,024)

-

28, 2021

Year ended February

8,604,207

1.0

215,530

1.5

205,828

(4.3)

26,838

13.5

29, 2020

Note: Comprehensive income:

Fiscal Year ended February 28, 2021: -32,311 million yen

(-%)

Fiscal Year ended February 29, 2020:

60,292 million yen (64.7%)

Earnings

Earnings per share

Return on equity

Ordinary profit to

per share

- fully diluted

total assets

Year ended

yen

yen

%

%

(84.06)

-

(7.0)

1.2

February 28, 2021

Year ended February

31.88

31.83

2.5

2.0

29, 2020

Reference: Equity in gains

(losses) of equity-method

affiliates:

Year ended February 28, 2021: 3,977 million yen

Year ended February 29, 2020:

3,295 million yen

(2) Financial Position

Total assets

Net assets

Total equity ratio

Net assets per

share

million yen

million yen

%

yen

February 28, 2021

11,481,268

1,755,776

8.5

1,147.56

[excl. Financial Services]

[5,749,281]

[1,393,624]

[15.3]

-

February 29, 2020

11,062,685

1,849,278

9.6

1,264.63

[excl. Financial Services]

[5,665,381]

[1,498,689]

[17.2]

-

Reference: Total equity:

February 28, 2021: 970,321 million yen

February 29, 2020: 1,064,515 million yen

Total equity = Shareholders' equity plus total accumulated other comprehensive income.

Note:

The figures in square brackets represent consolidated financial position excluding the Financial Services

Business.

(3) Cash Flow Position

Cash flow from

Cash flow from

Cash flow from

Cash and cash equivalents

operating activities

investing activities

financing activities

at end of period

Year ended

million yen

million yen

million yen

million yen

396,461

(341,814)

24,290

1,217,054

February 28, 2021

Year ended

624,660

(341,492)

51,164

1,141,171

February 29, 2020

2. Dividends

Dividend per share

Total

Payout ratio

End-

End-

dividends

Dividends to net

Record date

first

second

End-third

Fiscal

Annual

paid

(consolidated)

assets

or period

quarter

quarter

quarter

year-end

total

(full year)

(consolidated)

Year ended

yen

yen

yen

yen

yen

million yen

%

%

-

18.00

-

18.00

36.00

30,406

112.9

2.8

Feb. 29, 2020

Year ended

-

18.00

-

18.00

36.00

30,601

-

3.0

Feb. 28, 2021

Year ending

101.5

Feb. 28, 2022

-

18.00

-

18.00

36.00

to

(forecast)

152.2

3. Forecast of Consolidated Earnings for the Fiscal Year ending February 28, 2022

(March 1, 2021 to February 28, 2022)

(Percentage figures represent year-on-year changes)

Profit (loss)

Earnings

Operating revenue

Operating profit

Ordinary profit

attributable to

per share

owners of parent

Six months

million yen

%

million yen

%

million yen

%

million yen

%

yen

ending

-

-

-

-

-

-

-

-

-

Aug. 31,

2021

200,000

32.8

190,000

36.9

20,000

23.65

Full year

8,620,000

0.2

to

to

to

to

to

-

to

220,000

46.1

210,000

51.3

30,000

35.48

Note: Aeon has not disclosed earnings forecasts for the first six months.

*Notes

  1. Changes affecting the consolidation status of significant subsidiaries during the period: None
  2. Changes in accounting policy, changes in accounting estimates, and retrospective restatement: 1) Changes in accordance with amendments to accounting standards: None
    1. Changes other than the above 1): None
    2. Changes in accounting estimates: None
    3. Retrospective restatement: None
  1. Number of shares issued (common stock)
    1. Number of shares issued at end of period (treasury stock included):

February 28, 2021:

871,924,572 shares

February 29, 2020:

871,924,572 shares

2)

Number of shares held in treasury at end of period:

February 28, 2021:

26,370,771 shares

February 29, 2020:

30,162,176 shares

3)

Average number of shares outstanding during the period:

Fiscal Year ended February 28, 2021:

844,964,447 shares

Fiscal Year ended February 29, 2020:

841,731,857 shares

  • For the number of shares serving as basis for calculation of earnings per share (consolidated), see "Per Share Information" on page 34.

For Reference

1. Non-consolidated Financial Results for the Fiscal Year ended February 28, 2021

(March 1, 2020 to February 28, 2021)

(1) Operating Results

(Percentage figures represent year-on-year changes)

Operating revenue

Operating profit

Profit (loss)

Ordinary profit

attributable to

owners of parent

Year ended

million yen

%

million yen

%

million yen

%

million yen

%

50,707

(14.4)

33,079

(17.3)

11,096

(50.1)

7,101

(74.6)

February 28, 2021

Year ended

59,238

5.0

40,008

5.6

22,234

26.0

27,916

58.0

February 29, 2020

Earnings

Earnings per share

per share

- fully diluted

Year ended

yen

yen

8.40

8.40

February 28, 2021

Year ended

33.16

33.15

February 29, 2020

(2) Financial Position

Total assets

Net assets

Total equity ratio

Net assets per

share

million yen

million yen

%

yen

February 28, 2021

1,516,381

669,333

44.1

791.06

February 29, 2020

1,529,735

677,544

44.3

804.41

Reference: Total equity: February 28, 2021: 668,951 million yen

February 29, 2020: 677,188 million yen

Total equity = Shareholders' equity plus total accumulated other comprehensive income.

*Audit Status

This report is not subject to audit by certified public accountant and audit firm.

*Appropriate Use of Earnings Forecasts and Other Important Information

(Note on the forward-looking statements)

The above forecasts, which constitute forward-looking statements, are based on information available to the Company as of the date of the release of this document. Actual results may differ materially from the above forecasts due to a range of factors.

For the forecasts herein, please refer to "(3) Outlook for the Fiscal Year ending February 28, 2022" on page 13.

Accompanying Materials

Contents

1. Review of Operating Results and Financial Statements

2

(1)

Analysis of Operating Results

2

(2)

Analysis of Financial Condition

12

(3)

Outlook for the Fiscal Year ending February 28, 2022

13

(4)

Dividend Policy and Dividends for the Fiscal Year ended February 28, 2021,

13

and the Fiscal Year ending February 28, 2022

2. Management Strategies and Policies

14

(1) Basic Policy on Management

14

(2) Medium-Term Management Strategy

14

3. Basic Policy Regarding Selection of Accounting Standards

15

4. Consolidated Financial Statements and Main Notes

16

(1)

Consolidated Balance Sheet

16

(2)

Consolidated Statement of Income and Consolidated Statement of

19

Comprehensive Income

(3)

Consolidated Statement of Changes in Equity

22

(4)

Consolidated Statement of Cash Flows

24

(5)

Notes on the Consolidated Financial Statements

26

(Notes on the Going-concern Assumption)

26

(Additional Information)

26

(Segment and Other Information)

27

(Per Share Information)

34

(Material Subsequent Events)

35

1

1. Review of Operating Results and Financial Statements

(1) Analysis of Operating Results

1) Summary of Operating Results

For the fiscal year ended February 28, 2021 (March 1, 2020 - February 28, 2021), Aeon Co., Ltd. (hereinafter "Aeon") posted consolidated operating revenue of 8,603,910 million yen (largely unchanged year on year), operating profit of 150,586 million yen (down 30.1%), and ordinary profit of 138,801 million yen (down 32.6%). These operating results were higher than the consolidated operating results forecasts announced in December 2020. Loss attributable to owners of parent was 71,024 million yen (a profit decrease of 97,863 million yen), but this was the result of one-off measures and other measures that will contribute to future improvements in profitability, and profitability is expected to recover in fiscal 2021 (March 1, 2021 - February 28, 2022). The aforementioned measures include those implemented in relation to the temporary suspension of store operations and the shortening of store opening hours in response to the spread of the novel coronavirus (COVID-19), rent reductions and exemptions for tenant specialty store companies (which are important business partners for Aeon), and measures to improve management efficiency such as inventory reductions.

Amid activity restrictions and people refraining from outings due to COVID-19, the Supermarket Business and the Health and Wellness Business both continued to operate as lifelines supporting the lifestyles of those in local communities with sales of food and daily essentials throughout the year, and both posted large increases in profit. The GMS (General Merchandise Store) Business was impacted by people refraining from going out and the suspension of operation of tenant zones accompanying the state of emergency declared in April 2020, but efforts were made to reduce inventories as a way to enhance the structure of the business, and the gross profit margin is now on a recovery track. Efforts also focused on reducing the expenses and increasing the profitability of the GMS Business. The Financial Services Business, Shopping Center Development Business, Services and Specialty Store Business, and the International Business were all impacted by suspensions of operations and shortened business hours in conjunction with the declaration of states of emergency both in Japan and overseas, as well as lockdowns, but the situation is currently recovering as a result of thorough efforts to prevent infection, respond robustly to the emerging "new normal", and improve earnings.

Common Group Strategy:

  • In November 2020, Aeon revised the AEON COVID-19 Protocol for Infectious Disease Control which was instituted in June 2020. This protocol established standards for epidemic prevention measures. The November revision added measures related to the introduction of equipment to ventilate facilities and air-cleaning systems to prevent infection via airborne droplets, and also added provisions regarding eradicating the risk of infection from employees in our facilities as well as measures to prevent secondary infections should a primary infection occur. The purpose of this protocol is to contribute to the realization of a society in which epidemic prevention is a part of daily life, protect the health and lifestyles of customers and employees, and ensure safe and secure lifestyles for people in local communities together with customers by implementing epidemic prevention measures on an ongoing basis, not as a temporary initiative. Aeon will continue working to reduce transmission risk, and build safe and secure store environments and workplace environments by combining a variety of epidemic prevention initiatives.
  • In accordance with basic agreements concerning supermarket management integration in six regions of Japan concluded in 2018, Aeon integrated management of supermarkets in the Chugoku and Shikoku regions and the Tokai and Chubu regions in fiscal 2019. In fiscal

2

2020, Aeon completed management integration in all regions of Japan by integrating management in the Hokkaido, Tohoku, Kinki, and Kyushu regions. Specifically, management integration was carried out at Aeon Hokkaido Corporation and Maxvalu Hokkaido Co., Ltd. in Hokkaido and at Maxvalu Tohoku Co., Ltd. and AEON Retail Co., Ltd. Tohoku Company's food business in the Tohoku region in March. In the Kinki region, The Daiei, Inc. made Kohyo Co., Ltd. a subsidiary. In the Kyushu region, management of Aeon Kyushu Co., Ltd., Maxvalu Kyushu Co., Ltd., and Aeon Store Kyushu Co., Ltd. was integrated in September. In the Chugoku and Shikoku region, to further reorganize stores, in October Maxvalu Nishinihon Co., Ltd. concluded an agreement to merge Marunaka Co., Ltd. and Sanyo Marunaka Co., Ltd. (which were converted into subsidiaries in March 2019), in March 2021. The integrated companies in each region will aim to become the companies that contribute the most to their local communities by responding to: diversification of food preferences, such as preferences for local food, low-priced food, and healthy food; even greater consciousness of safety and security; intensification of competition in the food market with e-commerce companies, convenience stores, and other providers; and changes in the labor environment.

  • In October, Aeon announced that BIG-A CO. LTD. and AꞏColle Co., LTD., companies involved in the Discount Store business, would carry out a management integration in March 2021. The management integration of the two companies is aimed at accelerating their dominance of the small-scale discount store business in the Greater Tokyo Area and building a new growth strategy in order to respond to changes in the business environment, such as the emerging "new normal" and changing work styles spurred by COVID-19, increasing numbers of budget-minded consumers, and intensifying price competition. To win the support of customers with overwhelmingly low prices, efforts will be made to establish low-cost management through consolidating procurement, integrating logistics, pursuing horizontal expansion of logistics-linkedlow-cost operations, and consolidating headquarters functions.
  • Aeon has set out a policy of reorganizing the Group business structure and is proceeding with the strategic liquidation and reorganization of Group companies. As a part of this effort, in April 2020, Aeon sold its entire shareholding in Zwei Co., Ltd. and terminated the business operated by Talbots Japan Co., Ltd. in May. In October, Aeon terminated the businesses operated by Claire's Nippon Co., Ltd., while in October Aeon sold its entire shareholding in Aeon Forest Co., Ltd., which operates The Body Shop in Japan.
  • In February 2021, AEON CO. (M) BHD. ("Aeon Malaysia") concluded an agreement on digital business with a group company of U.S.-based Giddy, Inc. that operates Boxed. Aeon Malaysia will utilize the advanced technology-supported platform of Boxed, which operates an online-only wholesale business and possesses strong customer proposal capabilities based on advanced automated logistics systems and AI-based algorithms, to provide convenient online shopping experiences to customers through functional screen design, personalized functions, and other features.

2) Business Segment Information

From the fiscal year under review, Aeon has revised the business segments presented as reportable segments. Comparisons and analysis for the fiscal year are based on the revised segments.

GMS Business

3

The General Merchandise Store (GMS) Business posted an operating loss of 15,689 million yen (a profit decrease of 22,913 million yen year on year) on operating revenue of 3,069,510 million yen (largely unchanged year on year) for the fiscal year.

Aeon Retail Co., Ltd. continued to capture demand arising from COVID-19. In terms of product-related initiatives, in response to people's growing focus on maintaining their current living standards, from early November Aeon Retail began selling up to approximately 700 daily necessities, including food and everyday consumables at special low prices. In addition, Sporsium, a shop offering home fitness-related items, was expanded to 352 stores nationwide, and by selling at-home fitness products and walking-related products, same-store sales in this category grew more than 30% year on year. Also, sales of the fall/winter series of HOME COORDY items developed in response to the "new normal" with the aim of meeting remote work and stay-at-home demand were strong. In terms of services, online supermarket services have experienced a sharp increase in demand, and Aeon Retail has proceeded with diversification of ways in which customers can receive their orders by increasing the number of stores that offer the "Pick Up!" service for customers to pick up merchandise ordered online to 200 stores as of the end of February 2021. Aeon Retail also bolstered its online advanced sales of food for special events, such as Christmas, New Year's, and Setsubun (traditional festival celebrating the coming of spring), and online supermarket sales increased significantly. In response to increased customer demand for non-contact and non-face-to-face services, Aeon Retail has introduced Regi Go, a service that meets this demand by allowing customers themselves to use smartphones to scan items and pay for them at dedicated cash registers, and the number of stores offering this service increased to 22 stores as of the end of February. In addition to these initiatives, Aeon Retail proactively reduced inventories to improve management efficiency, resulting in an approximately 20% decline in inventories compared to the beginning of the fiscal year, and a continual improvement in gross profit margin as the fiscal year progressed. Moreover, Aeon Retail opened 12 new stores during the fiscal year. This included the grand opening in November of Aeon Style Fujimino (Saitama Prefecture), a store designed in response to the "new normal" based on the concept "Healthy bodies and minds. A store that supports a fulfilling life".

In March, Aeon Hokkaido Corporation (hereinafter "Aeon Hokkaido") carried out a management integration with Maxvalu Hokkaido Co., Ltd., and made a fresh start as the new Aeon Hokkaido. Aeon Hokkaido engaged in development of local production areas and products through the Food Products Development Department, which was established in order to promote the expansion and enhancement of the private-brand food product range, and developed approximately 760 items unique to the region during the fiscal year. Aeon Hokkaido also held an "Aeon Dosan Day" aimed at supporting local food produce during the period, and in order to help local restaurants and producers facing a variety of difficulties as a result of COVID-19, they were given the opportunity to communicate with people through various media and through digital signage in stores. In addition, Aeon Hokkaido expanded the "Raku Haya! Cooking" initiative, which it has been undertaking at supermarkets with the aim of recommending fresh seasonal ingredients and suggesting dishes to cook, to all 40 GMS Business stores. The number of Supermarket Business stores offering cut flowers, a strongly performing product for the GMS Business, was expanded to 30, and sales were strong. Elsewhere, in response to the increase in online supermarket demand, Aeon Hokkaido worked to increase the number of orders received, including by upgrading its systems, and net sales in the online supermarket business increased 32.3% year on year. Gift sales via the online shop "eShop" were robust, and Aeon Hokkaido also launched six additional specialty websites, including "Aeon Toys", and net sales increased 165.6% year on year. As a result of these initiatives and the management integration, Aeon Hokkaido posted an increase in sales and profit.

4

Supermarket Business

The Supermarket Business posted operating profit of 50,687 million yen (a profit increase of 135.7% year on year) on operating revenue of 3,265,669 million yen (up 1.3% year on year) for the fiscal year.

The United Super Markets Holdings Group (hereinafter "U.S.M. Holdings") prioritized measures to prevent infection in stores and thereby fulfil its responsibility as a part of the lifeline infrastructure of local communities. In terms of digitalization initiatives, the Scan & Go Service, a payment function that facilitates simple, secure, effortless shopping using customers' own smartphones without waiting in line at cash registers possible, was first introduced and then expanded among stores of Kasumi Co., Ltd., and introduced at stores of both Maruetsu, Inc. and Maxvalu Kanto. U.S.M Holdings also expanded Online Delivery, a service that allows customers to order products using smartphones and pick them up at stores or designated delivery destinations within the service area. The company also expanded the rollout of an advertisement distribution and marketing service that utilizes AI digital signage. Furthermore, the company proactively refurbished stores, and worked to bolster its fresh food and delicatessen food offerings, and enhance its product lineup, enabling it to enhance the convenience of its outlets as food specialty stores. Also, the company worked to increase productivity through initiatives such as introducing full-self-checkout registers and semi-self- checkout registers, and standardizing work processes.

At Maxvalu Tokai Co., Ltd. (hereinafter "Maxvalu Tokai"), in response to the increase in demand for eating-at-home and more customers seeking to economize, and in an effort to ensure the stable provision of products to customers, the company bolstered its offerings of fresh foods and products that are frequently purchased, worked to offer more appealing prices, enhanced its lineup of individually-wrapped, small volume foods, and established "day of week" sales with uniformly priced products, as well as special promotion days such "customer appreciation days", along with special store displays on weekends. The company also launched the Mie Prefecture Arigato and Aichi Prefecture Arigato campaigns in order to expand the rollout of locally-produced products cherished by local residents and to strengthen partnerships with local communities. In terms of services, in response to changes in customer purchasing behavior, the company increased the number of online supermarket delivery centers and expanded delivery areas. Also, in addition to a product delivery service utilizing the Uber Eats food delivery platform introduced on a trial basis in November, the company launched new trial initiatives, including providing access to online supermarket services within the popular recipe video service "Kurashiru" from February 2021.

Health and Wellness Business

The Health and Wellness Business recorded operating profit of 41,532 million yen (up 16.6% year on year) on operating revenue of 956,596 million yen (up 8.9%) for the fiscal year.

At Welcia Holdings Co., Ltd. (hereinafter "Welcia Holdings") and its consolidated

subsidiaries, although business was affected by COVID-19, efforts were made to continue operations and provide products and services while implementing measures to prevent infection and ensure high hygiene standards. Despite the impact from the decline in demand for cosmetics and makeup products due to people working from home and refraining from going out, merchandise sales were strong because of higher demand for items such as food and products to prevent infection. With regard to prescription drugs, in addition to the impact from drug price revisions, there was an impact from the decline in the number of prescriptions filled as less people are undergoing medical examinations and prescription unit prices increased due to the increase in long-term prescriptions as a result of people refraining from going out due to COVID-19, but sales remained strong due to the increase in the number of stores dispensing prescription drugs (1,643 stores as of February 28, 2021, an increase of 201 stores compared to February 29, 2020). With respect to SG&A expenses, Welcia Holdings worked to control

5

expenses, especially personnel expenses, through efforts such as increasing the operating efficiency of stores by promoting thorough store labor-hour management through labor-hour control and automating ordering. Also, Welcia Holdings increased the number of group stores to 2,217 as of February 28, 2021 through the proactive opening of new stores and M&A. As a result of these initiatives, Welcia Holdings posted increased revenue and profit.

Financial Services Business

The Financial Services Business posted operating profit of 42,648 million yen (down 39.5% year on year) on operating revenue of 487,572 million yen (up 0.6%) for the fiscal year.

Aeon Financial Service Co., Ltd. (hereinafter "AFS") leveraged Aeon Group's retail business and e-commerce channels which offer food products and daily goods tailored to people's lifestyles , as well as AFS's unique customer base with its strengths based on partnerships with large blue-chip companies such as major public transportation agencies, to enhance screening and diversify marketing methods. Furthermore, AFS continued to building out its platform facilitating business continuity amid the COVID-19 crisis by working to accelerate its digital transformation (DX), increase business efficiency, and advance workstyle reforms through the introduction of teleworking and other measures.

Aeon Bank Ltd. increased the number of installed video teller machines and expanded the online advanced reservation system and online financial consultation services as initiatives to facilitate non-face-to-face and contact-free services, as well as to minimize the time customers need to spend in branches. In addition the bank advanced efforts to introduce a housing loan service that enables customers to complete the entire loan application procedure, right through to completion of the loan agreement, at home via online application, telephone, and mail. Due to the bank's initiatives such as screening loan applications even on weekends and holidays, as well as well as strengthening marketing, the number of applications received increased and the loan balance grew despite the impact of COVID-19.

This year marks Aeon Card's 20th anniversary, and from November we launched an Aeon Card 20th anniversary campaign focused on expanding the customer base and increasing shopping transaction volume. Regarding credit card shopping, although there was still an impact on the use of credit cards for automobile-related purchases, such as gasoline and electronic toll collections, as well as for public transportation and travel agency use, credit card shopping transaction volume was high for Aeon Group, which accounts for a large proportion of the total 7 transaction volume, and was also high for supermarkets and drugstores. In addition, transaction volume at home improvement stores and large consumer electronics retailers was strong, and transaction volume in the fiscal year recovered to roughly the same level as the previous fiscal year.

In AFS's international operations, in Thailand, card transaction volume was low at department stores and travel agencies due to the impact of activity restrictions, but card shopping transaction volume increased for necessities such as food and daily consumables. With respect to cash advances and personal loans, AFS increased credit limits for customers with the ability to repay loans, and implemented a campaign encouraging dormant members to use these services. In Malaysia, for motorbike loans, which account for approximately 50% of the motorbike installment sales market, AFS returned its loan screening standards, which had temporarily been made stricter, to the same level as the previous year. This and other efforts resulted in the balance of motorbike loan operating receivables exceeding that of the previous fiscal year.

Shopping Center Development Business

The Shopping Center Development Business earned operating profit of 35,738 million yen (down 43.5% year on year) on operating revenue of 327,017 million yen (down 12.1%) for the fiscal year.

6

In its domestic business, in response to the state of emergency declaration in April, Aeon Mall Co., Ltd. (hereinafter "Aeon Mall") temporarily closed all 164 facilities nationwide. Subsequently, Aeon Mall resumed operations at all of its facilities by the end of May. In reopening, Aeon Mall implemented measures to prevent the spread of infection and ensure safety and peace of mind, such as installing AI-based temperature screening equipment at entrances and creating better air circulation inside mall buildings by bringing in more outside air. To meet needs in the "new normal" emerging as a result of COVID-19, Aeon Mall introduced fresh types of entertainment, such as drive-in movies and drive-in public viewings. Also, in June, Aeon Mall completely overhauled the Aeon Mall app and supported the specialty store business by providing services suited to changes in customer behaviors, such as providing information helping customers to avoid peak store visit times. During the Aeon Mall Black Friday event held in November, Aeon Mall carried out special activities utilizing both offline and online channels, including "live commerce" events and raffles that customers participated in using the Aeon Mall app. At Aeon Mall Ageo (Saitama Prefecture) which opened in December, in consideration of the health and safety of visitors and employees, the company enhanced air circulation, such as by installing air circulators directing air into atrium areas and opening the windows at the top of the atriums. Aeon Mall refurbished eight malls and also carried out refurbishment and floor space expansion of two further malls.

Although Aeon Mall temporarily closed as many as 11 of 21 malls operated in China in mid-February 2020, malls were reopened in stages, and specialty store operation at all malls had resumed by April. Aeon Mall implemented measures in response to changes in consumption behavior and government stimulus policies. These included the March start-up of a platform for "live commerce" (a new sales technique that fuses live video streaming and e-commerce), a delivery campaign for online purchases and restaurants, and the opening of night markets in large parking lot areas. In addition, the company reopened cinemas at all malls in early August, after having been closed in accordance with government orders. As a result of these initiatives, Aeon Mall posted year-on-year increases in specialty store sales at existing malls in its China business during the fourth quarter of the fiscal year (October 1, 2020 - December 31, 2020). In Vietnam, although the specialty stores of four malls were temporarily closed beginning in late March because of government regulations, stores at all malls reopened in late April. A subsequent COVID-19 outbreak in July temporarily impacted operations, but thanks to stringent measures to contain the virus, sales at specialty stores in existing malls in the fourth quarter of the fiscal year (October 1, 2020 - December 31, 2020) exceeded the level of the same period of the previous year. During the fiscal year, the company opened a total of two new malls. These were the Aeon Mall Sentul City (Jawa Barat), which opened in October as the company's third mall in Indonesia, and Aeon Mall Hai Phong Le Chan (Hai Phong), which opened in December as the company's sixth mall in Vietnam.

Services and Specialty Store Business

The Services and Specialty Store Business posted an operating loss of 17,690 million yen (a profit decrease of 22,211 million yen year on year) on operating revenue of 642,323 million yen (down 13.7% year on year) for the fiscal year.

Aeon Delight Co., Ltd. (hereinafter "Aeon Delight") set up a COVID-19 response headquarters covering Japan, China, and the ASEAN region, all being areas where it operates, at the beginning of February 2020. By carrying out a variety of measures to prevent infections in each area, the company contributed to creating facilities adapted to the age of COVID-19. In addition, as a part of the establishment of new standards for facility management incorporating infectious disease control measures, Aeon Delight is testing various measures to strengthen prevention of contact infection and improve ventilation within facilities, while the company has also established New Standard Cleaning (hereinafter "NSC"), a new cleaning method that creates a sanitary environment with a scientific evidence-based approach, and began providing

7

the NSC service in September. In providing this service, the company has created its own original education program based on the knowledge cultivated through sanitary cleaning services that it has been providing to hospitals over the years, as well as the latest developments in research, and the company has worked to expand the platform for providing this service. The company also worked to reform its business structure through the digital transformation of its operations and services, including transitioning to an area management system based on patrol- style facility management aimed at resolving personnel shortages and facilitating sustainable growth.

Cox Co., Ltd., a clothing and miscellaneous goods specialty store, opened a fashion mask specialty store on a limited-time basis in Tokyo Station's Yaesu underground shopping mall in September, positioning masks as fashion items given the fact that wearing a mask has become a normal part of everyday life. Subsequently, the company opened a total of 13 stores on a limited-time basis, centered on main train stations and department stores in key cities. Mask sales significantly boosted the company's presence, and the company revamped its online store in October, making it even easier to view and buy products, and more convenient to use the website. This led to significant growth with an 80.5% year-on year increase in online shopping sales. In addition, in response to stay-at-home demand, the company released a new range of loungewear, and also responded to changes in customer needs by expanding its selection of houseware.

International Business

(Aeon's consolidated financial statements for the International Business reflect results mainly for January through December).

The International Business posted operating profit of 6,068 million yen (down 43.7% year on year) on operating revenue of 414,413 million yen (down 5.6% year on year) for the year.

At Aeon Co. (M) Bhd. (hereinafter "Aeon Malaysia"), although January sales increased substantially year on year thanks to a successful early start during the Chinese New Year sales season, business activities were subsequently impacted due to the spread of COVID-19. Amid this situation, Aeon Malaysia implemented new initiatives, such as a drive-throughpick-up service for customers to pick up products ordered online in store parking lots, a service where personal shoppers buy products on behalf of customers, and a motorbike delivery service for seniors. In addition, efforts to capture demand for bulk purchasing and eating-at-home led to the posting of a year-on-year increase in food section sales.

Aeon Vietnam Co., Ltd., which has worked continuously to strengthen its response to social events, promoted sales of priority merchandise during the Tet (the Vietnamese Lunar New Year) sales season, one of the most important sales seasons of the year. During the season, sales of Lunar New Year-related products were particularly strong, mainly ao dai (a traditional Vietnamese garment) in the apparel category and gift items and fresh foods in the food category. Subsequently, although sales were affected most in April, when a lockdown was imposed due to the spread of COVID-19, sales in July recovered to a level above the previous year, due to the success of a large discount event and other initiatives as a part of a sale implemented as a measure to encourage consumption and help support customers. Business was then impacted by a second wave of COVID-19 infections, but the company subsequently bolstered its initiatives targeting social events such as the Harvest Moon, Black Friday, and Christmas, and sales are now back on a recovery track. In terms of new stores, in December the company opened the Le Chan store (Hai Phong), the sixth GMS Business store in Vietnam.

In China, sales promotions timed to coincide with the peak in demand during the Chinese New Year holiday, the time of year when sales are highest, fueled strong sales, with sales during the Chinese New Year period increasing 5% year on year. After the Chinese New Year, although sales of apparel as well as household and recreational products declined due to the spread of COVID-19, food sales grew substantially due to more opportunities for people to eat

8

meals at home and bulk-buying of groceries. Because infection was subsequently contained, sales in April and May exceeded the prior-year level, but sales were then impacted by changes in shopping behavior, including the further shift to online shopping and the rapid expansion of bulk-buying, as well as the spreading once again of COVID-19 infections in some regions starting in June. In response to the changes in shopping behavior, the Aeon app service was introduced for all stores in China, the company worked to offer information and services drawing on Aeon's strength of possessing brick-and-mortar stores, and substantially expanded the introduction of self-checkout registers.

3) Implementation of Corporate Governance During the Period

With the 2003 Commercial Code amendment targeting open management on par with companies around the world, Aeon became one of the first Japanese companies to transition to a "company with committees" structure (now "company with a nomination committee and other committees" structure), thereby establishing a governance structure that clearly segregates management oversight and business execution between directors and executive officers. The Board of Directors comprises seven directors, of which four directors, representing a majority, are outside directors from a wide range of industries. The Nomination Committee, Compensation Committee, and Audit Committee are each chaired by outside directors, with the goal of maintaining and further increasing transparency and fairness as well as enhancing shareholder returns. Also, in 2008, as a part of the Group's management reforms, efforts were made to build a foundation for continuous enhancement of corporate value, including the transition to being a pure holding company, in order to construct a new growth model for the Group, rebuild the business structure, and further increase the concentration and decentralization of power. In 2016, Aeon established the Basic Policy on Corporate Governance, in order to continue practicing management grounded in a long-term perspective built on Aeon's Basic Principles and Aeon's DNA of innovation.

Status of Implementation of the Board of Directors and Each Committee

(* Denotes outside director)

Meetings

Members

Main Functions

Held

Board of

7

Chairperson: Motoya Okada

- Oversee the work performance

Directors

Akio Yoshida, Akinori

of the directors and executive

Yamashita, *Takashi

officers.

Tsukamoto, *Kotaro Ohno,

- Make decisions on matters

*Peter Child, *Carrie Yu

stipulated under Article 416 of

the Companies Act as well as

matters that cannot be entrusted

to the executive officers.

Audit

9

Chairperson: *Kotaro Ohno

- Audit the work performance of

Committee

*Takashi Tsukamoto, *Carrie

the directors and executive

Yu

officers.

- Decide the content of proposals

to nominate, dismiss, or forgo

the reappointment of the

accounting auditor, which are

submitted to the General

Meeting of Shareholders.

Nomination

3

Chairperson: *Kotaro Ohno

- Decide the content of proposals

Committee

*Peter Child, Motoya Okada

for the nomination or dismissal

of directors, which are submitted

to the General Meeting of

Shareholders.

9

Compensation

3

Chairperson: *Takashi

- Decide individual

Committee

Tsukamoto

compensation, etc. received by

*Peter Child, Motoya Okada

directors and executive officers.

4) Fulfillment of Corporate Social Responsibility During the Fiscal Year

In order to fulfill its social responsibility as a corporate citizen and continuously increase its corporate value, Aeon promotes sustainable management that balances the realization of a sustainable society and the Group's growth. Based on the Aeon Sustainability Principle, Aeon has positioned the environmental challenges of achieving a decarbonized society, preservation of biodiversity, and promotion of resource recycling, as well as the societal challenges of creating products and stores that meet society's expectations, engaging in fair business practices that respect human rights, and collaborating with the community as priority issues. Specific initiatives Aeon is working on include energy-saving and energy generation, as well as reduction of waste, tree-planting activities with customers and programs encouraging customers to bring their own shopping bags, sustainable procurement throughout the supply chain, and initiatives to support the reconstruction effort in the Tohoku region. Also, the Aeon 1% Club Foundation works to nurture the next generation and promote friendship and goodwill programs with other countries, while the Aeon Environmental Foundation engages in tree-planting activities and supports environmental conservation activities. All of the above initiatives are part of Aeon's wide-ranging environmental and social contribution activities.

Aeon Sustainability Principle

Aeon aims to realize a sustainable society and ensure Group growth based on our basic principle of "pursuing peace, respecting humanity, and contributing to local communities, always with the customer's point of view as its core."

In conducting activities, we will think globally and advance activities locally from both environmental and social viewpoints in actively pursuing sustainability with many different stakeholders.

Environment Priority Issues

Society Priority Issues

Realization of decarbonized society

Creating products and stores that meet

Conservation of biodiversity

society's expectations

Better use of resources

Implementing fair business practices based

on respect for human rights

Collaborating with communities

Toward Realization of a Sustainable Society

  • To achieve the goals set forth in Aeon Decarbonization Vision 2050, Aeon is promoting energy-saving and shifting to renewable energy. Efforts include the introduction of on-site PPA (power purchasing agreements) for solar power generation, post-FIT electricity purchasing, and in fiscal 2020 Aeon for the first time began operating stores in which 100% of the electric power used comes from renewable energy. In recognition of these initiatives, Aeon was selected as a Climate Change A List company (the highest rating) by CDP, an NGO that conducts international environment-related surveys and discloses environmental information, for the second consecutive year.
  • In order to support the livelihoods of children and households raising children who have been forced to bear a particularly heavy burden due to COVID-19, in December Aeon teamed up with an NPO, the National Children's Cafeteria Support Center Musubie, to launch the AEON Children's Cafeteria Support Group. Aeon has been raising funds for the initiative at all Aeon Group stores and business offices nationwide in order to support the activities of children's cafeterias across Japan which have been struggling to continue their

10

normal activities to support children amid the difficult environment, and donated 35.03 million yen in February.

  • To further advance sustainable procurement, Aeon has set a new goal of shifting to raw ingredients that have been proven to be sustainable for use in Aeon's private brand Topvalu coffee and freshly brewed coffee sold at Group stores including Aeon Retail, Daiei, and Ministop stores.
  • In terms of efforts to reduce food waste, Aeon is the only retailer in Asia participating in a food waste reduction initiative carried out by the WRI (World Resources Institute), a U.S. non-profit organization that aims to reduce food waste throughout entire supply chains.
    Aeon is working on this project with 21 other companies in Japan including food manufacturers.
  • Having set a target of halving the volume of disposable plastic it uses by 2030, Aeon launched the "Bottle to Bottle Project" in February 2021, starting in the Kanto region. This project is the key pillar of Aeon's initiatives to achieve this target, and the project aims to build a resource recycling system using closed-loop recycling, in which the recycled resin from PET bottles collected from customers at Aeon's stores will be used as raw materials in Aeon products. In fiscal 2021, Aeon will establish a mechanism for recycling PET bottles collected at stores in the Kanto region into new products, and plans to expand this initiative nationwide in phases.

Great East Japan Earthquake Reconstruction Support Activities

  • The effort to assist recovery and reconstruction in areas that suffered massive damage from the Great East Japan Earthquake has reached the 10-year mark. With the aim of taking an "all of Aeon" (management and labor together) approach, in March 2012 Aeon launched the "Project AEON Joining Hands". In the 10 years since its launch, the project achieved its goals of planting 300,000 trees in coastal areas of the Tohoku region, and having 300,000 employees volunteer to help. Since fiscal 2016, Aeon has also been working on the "Aeon Future Co-creation Program", which aims to support the resolution of the region's challenges through exchange and engagement. Going forward, the Aeon Group will continue to work with the people of the Tohoku region to help realize a new stage of recovery, and contribute to a quick recovery and revitalization of the affected areas.

11

(2) Analysis of Financial Condition

Consolidated Assets, Liabilities, Net Assets, and Cash Flows (millions of yen) Fiscal year to end-February,

2021

2020

2019

2018

Total Assets

11,481,268

11,062,685

10,045,380

9,452,756

Interest-bearing debt

3,145,713

3,006,690

2,552,589

2,344,381

Breakdown:

Interest-bearing debt of financial

1,043,469

1,064,956

905,802

809,773

subsidiaries

Interest-bearing debt excluding that

2,102,243

1,941,734

1,646,787

1,534,608

of financial subsidiaries

Net assets

1,755,776

1,849,278

1,875,364

1,916,737

Cash and cash equivalents, ending

1,217,054

1,141,171

814,479

870,013

balance

Cash flow from operating activities

396,461

624,660

469,874

463,911

Cash flow from investing activities

(341,814)

(341,492)

(662,416)

(427,854)

Cash flow from financing activities

24,290

51,164

143,792

28,641

Consolidated Assets, Liabilities, and Net Assets

Consolidated assets as of February 28, 2021 were 11,481,268 million yen, an increase of 418,582 million yen, or 3.8%, from the end of the previous fiscal year (February 29, 2020). The increase is mainly attributable to an increase of 268,369 million yen in loans and bills discounted for banking business, an increase of 158,033 million yen in securities, and an increase of 65,572 million in cash and deposits.

Consolidated liabilities as of February 28, 2021 were 9,725,491 million yen, an increase of 512,083 million yen, or 5.6%, from February 29, 2020. The increase is mainly attributable to increases of 225,770 million yen in deposits for banking business and 120,892 million yen in bonds (including the current portion of bonds) as well as 107,085 million yen in short-term loans payable and 86,639 million yen in reserve for insurance policy liabilities due to the impact of newly consolidated companies.

Consolidated net assets as of February 28, 2021 were 1,755,776 million yen, a decrease of 93,501 million yen, or 5.1%, from February 29, 2020.

Consolidated Cash Flows

Cash and cash equivalents

The balance of cash and cash equivalents as of February 28, 2021 was 1,217,054 million yen, an increase of 75,883 million yen, or 6.6%, from February 29, 2020.

Cash flow from operating activities

Net cash provided by operating activities was 396,461 million yen, a decrease in cash provided of 228,198 million yen, or 36.5% year on year. The decrease in cash provided is mainly attributable to the 184,246 million yen increase in cash loans and bills discounted for banking business and the 155,003 million yen decrease in notes and accounts payable - trade, which were partially offset by the increase in cash provided from the 192,869 million yen decrease in notes and accounts receivable - trade.

Cash flow from investing activities

Net cash used in investing activities was 341,814 million yen, an increase in cash used of 321 million, or 0.1%, year on year. The increase in cash used is mainly attributable to an increase of 45,899 million yen in acquisition of securities for banking business and a decrease of 52,131 million yen in proceeds from sales of non-current assets, which offset a decrease of 116,507 million yen in purchase of non-current assets.

Cash flow from financing activities

12

Net cash provided by financing activities was 24,290 million yen, a decrease in cash provided of 26,873 million yen, or 52.5%, year on year. The decrease in cash provided is mainly due to a decrease of 169,824 million yen in proceeds from issuance of bonds, which offset an increase of 90,224 million yen in short-term bank loans and commercial papers.

(3) Outlook for the Fiscal Year Ending February 28, 2022

Consolidated Operating Results Forecast

Fiscal year to end-February,

(millions of yen)

2022 (forecast)

2021 (actual)

Operating revenue

8,620,000

8,603,910

Operating profit

200,000

to

220,000

150,586

Ordinary profit

190,000

to

210,000

138,801

Profit attributable to owners of parent

20,000 to 30,000

(71,024)

For operating results in the fiscal year ending February 28, 2022, Aeon is projecting a further improvement in profitability, and expects a V-shaped recovery back to the level of the fiscal year ended February 29, 2020, prior to COVID-19. In light of the situation with infections and the possibility for accompanying changes to restrictions and measures in countries where Aeon operates, Aeon has expressed its forecasts for operating profit and lower profit lines, as ranges rather than figures.

In addition, Aeon has formulated the Aeon Group Medium-Term Management Plan, which begins in the fiscal year ending February 28, 2022. Please refer to Aeon's website for an overview of the plan.

https://www.aeon.info/ir/(Latest information) https://www.aeon.info/ir/policy/strategy/ (Medium-TermManagement Plan, sustainable management initiatives)

  1. Dividend Policy and Dividends for the Fiscal Year ended February 28, 2021 and the Fiscal Year ending February 28, 2022
    1) Basic Medium- to Long-Term Policy
    Aeon considers maintaining an optimal balance between providing shareholder returns and improving corporate value through medium- to long-term growth a key management priority, and will continue to set a dividend policy that takes consolidated operating results into consideration.

(Dividends)

Aeon has set a target of a consolidated dividend payout ratio of 30% while maintaining its annual dividend payment at or above the prior-year level and will strive for further earnings growth and shareholder returns.

(Use of internal reserves)

Aeon will utilize internal reserves as funds for growth investments essential for future business development and meet shareholder expectations through corporate value enhancement achieved from medium- to long-term growth.

  1. Dividends for the Fiscal Year Ended February 28, 2021 and Starting Date for Dividend Payments
    By resolution of the Board of Directors at a meeting held on April 9, 2021, the year-end dividend payment from retained earnings for the fiscal year ended February 28, 2021 will be 18 yen per share. The total annual dividend for the fiscal year will therefore be 36 yen per share, including the interim payment of 18 yen per share. The starting date for dividend payments (effective date) is Friday, April 30, 2021.
  2. Dividend Forecast for the Fiscal Year Ending February 28, 2022

13

In accordance with the basic policy outlined above, Aeon plans to pay an ordinary dividend for the fiscal year ending February 28, 2022 of 36 yen per share, consisting of an interim payment of 18 yen per share and a year-end payment of 18 yen per share.

2. Management Strategies and Policies

(1) Basic Policy on Management

Aeon's unchanging fundamental management principles are the pursuit of peace, respect for humanity, and contributions to local communities-with the customer's point of view as the core. On the basis of this philosophy, and from the viewpoint "everything we do, we do for our customers," Aeon closely watches market and customer changes and is pursuing corporate value enhancement with the aim of being a corporate group that contributes to sustainable growth and local communities from a long-term perspective.

Aeon has instituted the Aeon Code of Conduct, a set of behavior guidelines and standards for decision-making for all Group employees to follow in their daily work activities, and Aeon is instilling this code throughout the Group. On the basis of this code, Aeon will strive to achieve long-term prosperity and growth by building excellent relationships with its customers, shareholders, business partners, local communities, and employees, while continuing to offer products and services that satisfy customers.

  1. Medium-TermManagement Strategy Aeon Group's Sustainable Growth
    Aeon has been building value chains in different parts of Asia, and has grown to become a top- class super-regional retailer. In 2020, there was a significant acceleration of changes that were already underway, including big changes in consumer behavior, sentiment, and values, as a result of COVID-19, in addition to demographic changes, changes in the social environment due to climate change, the permeation of digital technology into all aspects of life, heightening health awareness, and structural changes in the competitive environment. Looking ahead to the upcoming 10 years from a medium- to long-term perspective, Aeon recognizes that it will face environmental changes that are on a completely different scale compared to the changes it has experienced in the past. The Group formulated the Aeon Group Medium-Term Management Plan looking ahead to 2025 based on its view that this tumultuous environmental change is an opportunity for dramatic growth. In this new medium-term management plan, in addition to further accelerating the "shift to regional markets", "shift to digital markets", "shift to Asian markets", and the "shift in investments" to support the other "shifts", the Aeon Group will aim to build a business foundation that facilitates sustainable growth by working on "Five Reforms" (accelerate and evolve the shift to digital, create unique value with a supply chain-focused outlook, evolve health and wellness in response to the new era, create Aeon lifestyle spheres, and further accelerate the shift to Asian markets) as strategies shared across the entire Group. By doing so, Aeon will significantly reform the Group's business structure and transform itself into a highly-profitable corporate group.

Promotion of Diversity

Aeon views promoting diversity as not just a matter of addressing social issues, but also as one of its management strategies. Aeon's basic philosophy on human resources is that discrimination based on attributes such as nationality, gender, age, physical and/or intellectual disabilities, sexual orientation, or gender identification should be eliminated, and that human resources matters should be decided based on abilities and achievements. Aeon aims to be an organization that fully utilizes the abilities of diverse human resources, boldly responds to dramatic changes in the environment, and always flexibly responds to customers' needs and continues to innovate. Aeon uses the term "Daimanzoku," which means very satisfied in Japanese, to refer to the satisfaction born from diversity management felt by employees and their family members, customers, and the company, and the Aeon Group is working on a variety of activities to create such satisfaction. Good examples of diversity management by Group companies in which efforts are rooted in local communities and take advantage of the individual

14

company's specific business characteristics are now shared among Group companies. In addition, the Group offers the "Daimanzoku College" online training programs that include level-specific training for female employees, training for the active participation of people with disabilities, and LGBT-related training. It has become easy for employees to participate in Daimanzoku College training programs from business sites throughout the country, and these programs take advantage of the Group's strengths by giving employees a chance to interact with people from across the Group and share diverse insights and connect with role models. In recognition of these initiatives, in March 2021 Aeon and Aeon Mall were selected as "Nadeshiko Brand" companies that excel in promoting the advancement of women. This marks the fourth and fifth consecutive years, respectively, for Aeon and Aeon Mall to be selected as "Nadeshiko Brand" companies.

Health Management Initiatives

Aeon promotes health management based on the belief that the promotion of employee health is the cornerstone of corporate activity, and that healthy employees are better able to provide services that contribute to the health and happiness of customers. In fiscal 2020, Aeon set a goal of reducing the number of employees who smoke by 25%, and based on this goal, 115 Aeon Group companies began prohibiting smoking during working hours and smoking on company grounds. In terms of efforts to prevent the spread of infectious diseases, Aeon implemented measures to prevent COVID-19 infections, and fully subsidized the cost of influenza vaccinations. In recognition of these initiatives, in March 2021 Aeon was certified as a 2021 Company with Excellent Health Management (White 500).

3. Basic Policy Regarding Selection of Accounting Standards

The Aeon Group uses Japanese accounting standards for its financial reporting.

Regarding the adoption of International Financial Reporting Standards (IFRS), Aeon will take appropriate measures in consideration of various developments in and outside Japan.

15

4. Consolidated Financial Statements and Main Notes

(1) Consolidated Balance Sheet

(Millions of yen)

As of

As of

February 29, 2020

February 28, 2021

Amount

Amount

Assets

Current assets

Cash and deposits

1,221,991

1,287,564

Call loans

53,773

30,841

Notes and accounts receivable - trade

1,626,704

1,602,703

Securities

462,062

620,096

Inventories

575,748

542,894

Operating loan

433,808

415,531

Loans and bills discounted for banking business

2,049,319

2,317,689

Other

404,271

453,335

Allowance for doubtful accounts

(114,328)

(134,409)

Current assets

6,713,352

7,136,247

Non-current assets

Property, plant and equipment

Buildings and structures, net

1,555,080

1,508,861

Tools, furniture and fixtures, net

221,896

207,096

Land

926,900

945,371

Leased assets, net

89,198

96,979

Construction in progress

41,590

46,307

Other, net

259,654

258,299

Property, plant and equipment

3,094,320

3,062,916

Intangible assets

Goodwill

133,989

121,659

Software

105,477

122,593

Leased assets

26,530

26,345

Other

35,890

34,163

Intangible assets

301,888

304,762

Investments and other assets

Investment securities

229,916

269,706

Net defined benefit asset

11,975

18,087

Deferred tax assets

159,727

147,034

Guarantee deposits

414,576

409,843

Deposits for stores in progress

2,189

1,049

Other

143,542

139,672

Allowance for doubtful accounts

(8,803)

(8,051)

Investments and other assets

953,124

977,341

Non-current assets

4,349,333

4,345,020

Assets

11,062,685

11,481,268

16

(Millions of yen)

As of

As of

February 29, 2020

February 28, 2021

Amount

Amount

Liabilities

Current liabilities

Notes and accounts payable - trade

1,068,427

1,072,409

Deposits for banking business

3,784,320

4,010,090

Short-term loans payable

253,395

360,481

Current portion of long-term loans payable

303,055

281,435

Current portion of bonds

75,633

68,882

Commercial papers

168,131

91,269

Lease obligations

54,146

56,238

Income taxes payable

55,363

53,954

Provision for bonuses

31,475

35,055

Provision for loss on store closing

8,245

10,143

Provision for point card certificates

24,319

25,143

Notes payable - facilities

58,171

44,116

Other

714,536

769,250

Current liabilities

6,599,221

6,878,471

Non-current liabilities

Bonds payable

779,513

907,156

Long-term loans payable

1,040,774

1,043,122

Lease obligations

309,782

316,705

Deferred tax liabilities

37,444

40,137

Provision for directors' retirement benefits

882

449

Provision for loss on store closing

2,923

2,622

Provision for contingent loss

53

58

Provision for loss on interest repayment

4,965

5,706

Provision for loss on future collection of gift

5,455

5,738

certificates

Net defined benefit liability

25,496

21,852

Asset retirement obligations

97,369

104,029

Long-term guarantee deposited

261,653

254,763

Reserve for insurance policy liabilities

-

86,639

Other

47,872

58,036

Non-current liabilities

2,614,186

2,847,019

Liabilities

9,213,407

9,725,491

17

(Millions of yen)

As of

As of

February 29, 2020

February 28, 2021

Amount

Amount

Net assets

Shareholders' equity

Capital stock

220,007

220,007

Capital surplus

307,089

300,964

Retained earnings

541,180

439,600

Treasury shares

(42,455)

(36,601)

Shareholders' equity

1,025,822

923,971

Accumulated other comprehensive income

Valuation difference on available-for-sale securities

55,054

62,813

Deferred gains or losses on hedges

(4,149)

(3,122)

Foreign currency translation adjustment

(2,064)

(8,752)

Remeasurements of defined benefit plans

(10,147)

(4,589)

Total accumulated other comprehensive income

38,693

46,349

Subscription rights to shares

1,706

1,550

Non-controlling interests

783,056

783,904

Net assets

1,849,278

1,755,776

Liabilities and net assets

11,062,685

11,481,268

18

(2) Consolidated Statement of Income and Consolidated Statement of Comprehensive Income

Consolidated Statement of Income

(Millions of yen)

Year ended

Year ended

February 29, 2020

February 28, 2021

Amount

Amount

Operating revenue

Net sales

7,505,415

7,576,142

Operating revenue from financial services business

436,936

438,870

Other operating revenue

661,855

588,897

Operating revenue

8,604,207

8,603,910

Operating costs

Cost of sales

5,431,856

5,505,835

Operating cost from financial services business

36,917

86,056

Operating cost

5,468,774

5,591,891

Gross profit

2,073,558

2,070,306

Operating gross profit

3,135,433

3,012,018

Selling, general and administrative expenses

Advertising expense

207,802

170,572

Provision of allowance for doubtful accounts

64,440

70,084

Employees' salaries and bonuses

1,015,292

1,020,926

Provision for bonuses

31,475

35,055

Legal and employee benefits expenses

174,737

177,609

Utilities expenses

148,861

131,323

Depreciation

274,323

272,218

Repair and maintenance

155,587

156,811

Rents

393,413

384,603

Amortization of goodwill

14,309

14,051

Other

439,658

428,173

Selling, general and administrative expenses

2,919,902

2,861,432

Operating profit

215,530

150,586

Non-operating income

Interest income

3,589

3,579

Dividend income

2,545

2,254

Share of profit of entities accounted for using equity

3,295

3,977

method

Income from unredeemed gift vouchers

4,035

4,279

Penalty income from leaving tenants

4,020

3,719

Reversal of allowance for doubtful accounts

914

467

Other

13,013

12,210

Non-operating income

31,414

30,487

Non-operating expenses

Interest expenses

31,813

32,302

Other

9,302

9,968

Non-operating expenses

41,115

42,271

Ordinary profit

205,828

138,801

Extraordinary income

Gain on sales of non-current assets

29,785

7,311

Gain on revision of retirement benefit plan

-

7,853

Subsidy income

-

6,530

Other

19,240

5,541

Extraordinary income

49,025

27,236

Extraordinary losses

Loss on sales of non-current assets

668

397

19

Impairment loss

58,267

57,821

Provision for loss on store closing

6,146

5,172

Loss on retirement of non-current assets

5,295

3,236

Infectious disease related cost

-

33,964

Other

9,812

12,226

Extraordinary losses

80,189

112,819

Profit before income taxes

174,664

53,219

Income taxes

Current

98,509

82,144

Deferred

1,217

8,847

Income taxes

99,726

90,992

Profit (loss)

74,937

(37,772)

Profit attributable to non-controlling interests

48,099

33,252

Profit (loss) attributable to owners of parent

26,838

(71,024)

20

Consolidated Statement of Comprehensive Income

(Millions of yen)

Year ended

Year ended

February 29, 2020

February 28, 2021

Amount

Amount

Profit (loss)

74,937

(37,772)

Other comprehensive income

Valuation difference on available-for-sale securities

7,123

7,797

Deferred gains or losses on hedges

(4,769)

1,706

Foreign currency translation adjustment

(7,995)

(10,876)

Remeasurements of defined benefit plans, net of tax

(9,752)

6,558

Share of other comprehensive income of entities

748

276

accounted for using equity method

Other comprehensive income

(14,645)

5,461

Comprehensive income

60,292

(32,311)

Comprehensive income attributable to:

Comprehensive income attributable to owners of

19,386

(63,368)

parent

Comprehensive income attributable to non-

40,905

31,056

controlling interests

21

(3) Consolidated Statement of Changes in Equity

Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

(Millions of yen)

Shareholders' Equity

Capital stock

Capital surplus

Retained earnings

Treasury shares

Shareholders' equity

Balance at beginning of period

220,007

302,636

561,135

(36,290)

1,047,490

Cumulative effects of changes

(17,331)

(17,331)

in accounting policies

Restated balance

220,007

302,636

543,804

(36,290)

1,030,159

Changes of items during period

Dividends of surplus

(29,462)

(29,462)

Profit attributable to owners of

26,838

26,838

parent

Purchase of treasury shares

(13,013)

(13,013)

Disposal of treasury shares

6,231

6,848

13,080

Change in ownership interest

of parent due to transactions

(1,779)

(1,779)

with non-controlling interests

Net changes of items other

than shareholders' equity

Total changes of items during

-

4,452

(2,624)

(6,165)

(4,337)

period

Balance at end of period

220,007

307,089

541,180

(42,455)

1,025,822

Accumulated other comprehensive income

Valuation

Deferred

Foreign

Total

Subscription

Non-

Remeasurements

accumulated

Net assets

difference on

gains or

currency

of defined

other

rights to

controlling

available-for-

losses on

translation

shares

interests

benefit plans

comprehensive

sale securities

hedges

adjustment

income

Balance at beginning of period

47,391

(2,542)

2,155

(859)

46,145

1,960

779,768

1,875,364

Cumulative effects of changes

(12,359)

(29,690)

in accounting policies

Restated balance

47,391

(2,542)

2,155

(859)

46,145

1,960

767,409

1,845,674

Changes of items during period

Dividends of surplus

(29,462)

Profit attributable to owners

26,838

of parent

Purchase of treasury shares

(13,013)

Disposal of treasury shares

13,080

Change in ownership interest

of parent due to transactions

(1,779)

with non-controlling interests

Net changes of items other

7,663

(1,607)

(4,220)

(9,287)

(7,451)

(253)

15,647

7,941

than shareholders' equity

Total changes of items during

7,663

(1,607)

(4,220)

(9,287)

(7,451)

(253)

15,647

3,604

period

Balance at end of period

55,054

(4,149)

(2,064)

(10,147)

38,693

1,706

783,056

1,849,278

22

Year ended February 28, 2021 (March 1, 2020 - February 28, 2021)

(Millions of yen)

Shareholders' Equity

Capital stock

Capital surplus

Retained earnings

Treasury shares

Shareholders' equity

Balance at beginning of period

220,007

307,089

541,180

(42,455)

1,025,822

Changes of items during period

Dividends of surplus

(30,555)

(30,555)

Profit (loss) attributable to

(71,024)

(71,024)

owners of parent

Purchase of treasury shares

(140)

(140)

Disposal of treasury shares

2,107

5,995

8,102

Change in ownership interest of

(8,231)

(8,231)

parent due to transactions with

non-controlling interests

Net changes of items other than

shareholders' equity

Total changes of items during

-

(6,124)

(101,580)

5,854

(101,850)

period

Balance at end of period

220,007

300,964

439,600

(36,601)

923,971

Accumulated other comprehensive income

Valuation

Deferred

Foreign

Remeasurements

Total

Subscription

Non-

Net assets

difference on

gains or

currency

accumulated

rights to

controlling

available-for-

losses on

translation

of defined

other

shares

interests

benefit plans

comprehensive

sale securities

hedges

adjustment

income

Balance at beginning of period

55,054

(4,149)

(2,064)

(10,147)

38,693

1,706

783,056

1,849,278

Changes of items during period

Dividends of surplus

(30,555)

Profit (loss) attributable to

(71,024)

owners of parent

Purchase of treasury shares

(140)

Disposal of treasury shares

8,102

Change in ownership interest

of parent due to transactions

(8,231)

with non-controlling interests

Net changes of items other

7,758

1,027

(6,687)

5,557

7,656

(155)

847

8,348

than shareholders' equity

Total changes of items during

7,758

1,027

(6,687)

5,557

7,656

(155)

847

(93,501)

period

Balance at end of period

62,813

(3,122)

(8,752)

(4,589)

46,349

1,550

783,904

1,755,776

23

(4) Consolidated Statement of Cash Flows

(Millions of yen)

Year ended

Year ended

February 29, 2020

February 28, 2021

Amount

Amount

Cash flows from operating activities

Profit before income taxes

174,664

53,219

Depreciation

292,747

296,600

Amortization of goodwill

14,309

14,051

Increase (decrease) in allowance for doubtful accounts

8,543

18,807

Increase (decrease) in provision for loss on interest

1,122

741

repayment

Increase (decrease) in provision for bonuses

(1,389)

3,985

Increase (decrease) in net defined benefit liability

(4,059)

(5,592)

Decrease (Increase) in net defined benefit asset

(5,388)

(2,084)

Interest and dividend income

(6,134)

(5,834)

Interest expenses

31,813

32,302

Foreign exchange losses (gains)

(1,385)

(4,775)

Share of (profit) loss of entities accounted for using equity

(3,295)

(3,977)

method

Gain on sales of non-current assets

(29,785)

(7,311)

Loss on sales and retirement of non-current assets

7,452

5,125

Impairment loss

58,267

57,821

Gain on negative goodwill

(1,333)

-

Loss (gain) on sales of short-term and long-term

(10,088)

2

investment securities

Decrease (increase) in notes and accounts receivable -

(172,577)

20,291

trade

Decrease (increase) in inventories

22,263

33,923

Decrease (increase) in operating loans receivable

(41,057)

20,625

Decrease (increase) in cash loans and bills discounted for

(84,124)

(268,371)

banking business

Increase (decrease) in notes and accounts payable - trade

157,079

2,075

Increase (decrease) in deposits for banking business

341,266

225,770

Increase/decrease in other assets/liabilities

16,715

26,232

Other, net

(15,924)

(7,202)

Subtotal

749,702

506,428

Interest and dividend income received

7,855

8,195

Interest expenses paid

(31,998)

(34,589)

Income taxes paid

(100,899)

(83,573)

Net cash provided by (used in) operating activities

624,660

396,461

24

(Millions of yen)

Year ended

Year ended

February 29, 2020

February 28, 2021

Amount

Amount

Cash flows from investing activities

Purchase of securities

(1,398)

(31,960)

Proceeds from sales and redemption of securities

1,498

75,909

Acquisition of securities for banking business

(531,621)

(577,521)

Proceeds from sales and redemption of securities in

508,841

487,478

banking business

Purchase of non-current assets

(417,762)

(301,255)

Proceeds from sales of non-current assets

87,002

34,870

Purchase of investment securities

(3,590)

(28,148)

Proceeds from sales of investment securities

20,439

1,669

Purchase of shares of subsidiaries resulting in change in

(1,693)

(2,475)

scope of consolidation

Proceeds from purchase of shares of subsidiaries resulting

28

10,266

in change in scope of consolidation

Payments for guarantee deposits

(20,162)

(17,052)

Proceeds from collection of guarantee deposits

29,798

19,765

Proceeds from guarantee deposits received

21,400

16,112

Repayments of guarantee deposits received

(25,002)

(22,769)

Other, net

(9,272)

(6,705)

Net cash provided by (used in) investing activities

(341,492)

(341,814)

Cash flows from financing activities

Increase (decrease) in short-term bank loans and

(57,691)

32,533

commercial papers

Proceeds from long-term loans payable

231,606

294,788

Repayments of long-term loans payable

(239,228)

(310,227)

Proceeds from issuance of bonds

366,603

196,779

Redemption of bonds

(126,225)

(77,019)

Purchase of treasury shares

(13,013)

(140)

Proceeds from share issuance to non-controlling

2,255

1,538

shareholders

Repayments to non-controlling shareholders

(6,006)

(5,290)

Repayments of lease obligations

(73,331)

(54,380)

Cash dividends paid

(29,462)

(30,555)

Dividends paid to non-controlling interests

(23,229)

(20,649)

Proceeds from changes in ownership interests in

subsidiaries that do not result in change in scope of

6,982

-

consolidation

Payments from changes in ownership interests in

subsidiaries that do not result in change in scope of

(5,890)

(10,957)

consolidation

Other, net

17,795

7,871

Net cash provided by (used in) financing activities

51,164

24,290

Effect of exchange rate change on cash and cash

(7,639)

(3,095)

equivalents

Net increase (decrease) in cash and cash equivalents

326,692

75,842

Cash and cash equivalents, beginning of period

814,479

1,141,171

Increase in cash and cash equivalents resulting from merger

-

41

Cash and cash equivalents, end of period

1,141,171

1,217,054

25

(5) Notes on the Consolidated Financial Statements

Notes and other supplementary information for the consolidated balance sheet, the consolidated statement of income and consolidated statement of comprehensive income, the consolidated statement of changes in equity, and the consolidated statement of cash flows are omitted from this report.

(Notes on the Going-concern Assumption) Not applicable

(Additional Information)

(Transactions of Delivering the Company's Own Stock to Employees, etc. through Trusts) The Company has introduced the Employee Stock Ownership Plan Trust ("ESOP Trust") incentive scheme that provides the Company's work force with ownership interest in the Company with the aim of further enhancing corporate value over the mid to long term.

The ESOP Trust has adopted the gross accounting method, and the Company's stock held by the ESOP Trust was included in treasury shares under net assets. At the end of the fiscal year ended February 28, 2021, the book value of treasury shares and long-term loans payable (including the current portion) recorded in accordance with the adoption of the gross accounting method were 10,138 million yen (4,388,100 shares) and 11,050 million yen, respectively.

26

(Segment and Other Information)

[Segment Information]

1. Overview of Reportable Segments

Aeon has adopted the "nomination committee and other committees system" as its governance model. Under the system, operational supervision and operational execution functions are explicitly divided and allocated to individual directors and executive officers. The system enables swift management decision-making by delegating significant authority to executive officers to enable them to achieve medium- and long-term targets.

Aeon's reportable segments are components of its operations about which segment-specific financial statements are available. These segments are subject to periodic examinations to enable Aeon's management to decide how to allocate resources and assess performance.

Led by Aeon Co., Ltd, a pure holding company, the Group companies conduct various business operations centering on retail store operations, including financial services operations, shopping center development operations, and services and specialty store operations.

The main operations in each reportable segment and other businesses are thus as follows.

The GMS Business includes general merchandise stores (GMS), specialty stores that sell packaged lunches and ready-to-eat meals.

The Supermarket Business includes supermarkets, discount stores, convenience stores and small-scale supermarkets

The Health & Wellness Business includes drugstores, pharmacies and other related businesses. The Financial Services Business includes credit card, fee-based services, banking, and insurance businesses.

The Shopping Center Development Business includes development and leasing of shopping centers and malls.

The Services and Specialty Store Business includes facilities management services, amusement services, food services, and specialty stores that sell family casual apparel, women's apparel, footwear, and others.

International Business includes retail stores in the ASEAN region and China.

Other Businesses include mobile marketing business, digital and other related businesses.

2. Changes in Reportable Segments

In line with organizational changes, from the fiscal year ended February 28, 2021, the Company has reclassified some subsidiaries included in "Health and Wellness" business to include them in "Services and Specialty Store" business, and some subsidiaries included in "International" business to include them in digital business in "Other". For reference, segment information for the previous fiscal year was prepared based on the current segmentation.

27

3. Operating revenue, income/loss, assets, liabilities and other items by reportable segment Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

(Millions of yen)

Reportable segment

Health &

Financial

Shopping

Services and

GMS

Supermarket

Center

Specialty

Wellness

Services

Development

Store

Operating revenue:

(1) Revenue attributable to

2,831,842

3,212,842

878,291

436,936

290,482

565,567

customers

(2) Intersegment revenue or

238,678

11,520

359

47,782

81,444

178,526

transfers

Total

3,070,521

3,224,363

878,650

484,719

371,926

744,094

Segment income

7,223

21,507

35,625

70,464

63,279

4,521

Segment assets

1,428,143

1,189,877

435,111

5,813,931

1,593,193

395,025

Segment interest-bearing

329,516

245,736

47,438

1,065,476

772,761

81,659

debt

Other items:

Depreciation

50,566

55,120

14,460

34,625

74,074

19,951

Share of profit (loss) of

entities accounted for using

147

523

487

2,062

-

(253)

equity method

Impairment loss

17,597

21,977

4,097

398

6,729

4,946

Investment in entities

accounted for using equity

1,918

31,846

4,560

36,385

-

1,729

method

Increase in property, plant

and equipment and

115,566

80,465

27,256

44,130

119,580

20,872

intangible assets

Reportable segment

Reported in the

Other

Total

Adjustments

consolidated

International

Total

*1, 2

financial

statements*3

Operating revenue:

(1) Revenue attributable to

435,283

8,651,246

3,297

8,654,544

(50,337)

8,604,207

customers

(2) Intersegment revenue or

3,857

562,170

49,897

612,067

(612,067)

-

transfers

Total

439,141

9,213,417

53,194

9,266,612

(662,404)

8,604,207

Segment income

10,783

213,407

1,558

214,965

564

215,530

Segment assets

442,784

11,298,067

59,577

11,357,645

(294,959)

11,062,685

Segment interest-bearing

217,385

2,759,973

22,765

2,782,738

223,952

3,006,690

debt

Other items:

Depreciation

32,700

281,499

7,648

289,147

3,600

292,747

Share of profit (loss) of

entities accounted for using

1

2,967

-

2,967

327

3,295

equity method

Impairment loss

1,589

57,336

902

58,239

27

58,267

Investment in entities

accounted for using equity

0

76,440

-

76,440

5,209

81,649

method

Increase in property, plant

and equipment and

27,254

435,126

10,929

446,055

4,650

450,706

intangible assets

28

Notes: 1. Main components of the minus 50,337 million yen in adjustments for operating revenue attributable to customers are as follows:

  1. Minus 90,472 million yen in adjustments to service transactions reported in the reportable segment information, and
  2. 40,104 million yen in "operating revenues from equity-method affiliates" of Group companies attributable to Aeon Group merchandise supply that is part of head office functions and does not fall into any of the business segments.

2. Main components of the 564 million yen in adjustments for segment income are as follows:

  1. 2,098 million yen in income of the pure holding company (Aeon Co., Ltd.) not attributable to any of the business segments,
  2. Minus 157 million yen in income of Group companies attributable to Aeon Group merchandise supply that does not fall into any of the business segments, and
  3. Minus 1,322 million yen in intersegment transaction eliminations

3. Segment income adjustments are based on operating profit (loss) reported in the Consolidated Statement of Income for the corresponding period.

29

Year ended February 28, 2021 (March 1, 2020 - February 28, 2021)

(Millions of yen)

Reportable segment

Health &

Financial

Shopping

Services and

GMS

Supermarket

Center

Specialty

Wellness

Services

Development

Store

Operating revenue:

(1) Revenue attributable to

2,865,843

3,248,830

955,893

438,870

250,532

466,172

customers

(2) Intersegment revenue or

203,666

16,838

703

48,702

76,484

176,151

transfers

Total

3,069,510

3,265,669

956,596

487,572

327,017

642,323

Segment income (loss)

(15,689)

50,687

41,532

42,648

35,738

(17,690)

Segment assets

1,381,170

1,212,252

476,186

6,159,161

1,616,667

386,244

Segment interest-bearing

290,492

249,967

53,372

1,043,920

831,045

106,676

debt

Other items:

Depreciation

47,576

55,313

15,367

38,509

76,436

19,901

Share of profit (loss) of

entities accounted for

16

1,982

668

2,199

-

(952)

using equity method

Impairment loss

22,903

16,898

3,822

144

7,336

4,892

Investment in entities

accounted for using

1,872

33,548

5,141

36,504

-

606

equity method

Increase in property,

plant and equipment

56,993

67,897

26,398

39,488

109,382

20,047

and intangible assets

Reportable segment

Adjustments

Reported in the

Other

Total

consolidated

International

Total

*1, 2

financial

statements*3

Operating revenue:

(1) Revenue attributable to

410,902

8,637,046

7,089

8,644,135

(40,225)

8,603,910

customers

(2) Intersegment revenue or

3,511

526,058

47,244

573,303

(573,303)

-

transfers

Total

414,413

9,163,104

54,333

9,217,438

(613,528)

8,603,910

Segment income (loss)

6,068

143,296

2,357

145,653

4,932

150,586

Segment assets

408,612

11,640,294

65,206

11,705,501

(224,233)

11,481,268

Segment interest-bearing

208,576

2,784,051

20,420

2,804,472

341,241

3,145,713

debt

Other items:

Depreciation

31,226

284,331

8,467

292,798

3,801

296,600

Share of profit (loss) of

entities accounted for

(1)

3,914

-

3,914

62

3,977

using equity method

Impairment loss

1,021

57,018

777

57,795

26

57,821

Investment in entities

accounted for using

0

77,673

-

77,673

5,387

83,061

equity method

Increase in property,

plant and equipment

17,043

337,251

12,442

349,693

6,496

356,190

and intangible assets

30

Notes: 1. Main components of the minus 40,225 million yen in adjustments for operating revenue attributable to customers are as follows:

  1. Minus 79,921 million yen in adjustments to service transactions reported in the reportable segment information, and
  2. 39,588 million yen in "operating revenues from equity-method affiliates" of Group companies attributable to Aeon Group merchandise supply that is part of head office functions and does not fall into any of the business segments.

2. Main components of the 4,932 million yen in adjustments for segment income are as follows:

  1. 3,555 million yen in income of the pure holding company (Aeon Co., Ltd.) not attributable to any of the business segments,
  2. 2,956 million yen in income of Group companies attributable to Aeon Group merchandise supply that does not fall into any of the business segments, and
  3. Minus 1,629 million yen in intersegment transaction eliminations

3. Segment income adjustments are based on operating profit (loss) reported in the Consolidated Statement of Income for the corresponding period.

31

[Related Information]

Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

1. Information by merchandise and service

The information is omitted here because the same information is presented in the "Segment Information" above.

2. Information by geographic area

  1. Operating revenue

(Millions of yen)

Japan

ASEAN

China

Other

Total

7,832,102

390,512

276,514

105,078

8,604,207

Note:

Operating revenues are based on the location of customers and classified into countries or regions.

(2) Property, buildings and equipment

(Millions of yen)

Japan

ASEAN

China

Other

Total

2,489,046

347,393

244,072

13,807

3,094,320

3. Information by major customer

The information is omitted here because no customer accounts for more than 10% of the operating revenue on the Consolidated Statement of Income.

Year ended February 28, 2021 (March 1, 2020 - February 28, 2021)

1. Information by merchandise and service

The information is omitted here because the same information is presented in the "Segment Information" above.

2. Information by geographic area

  1. Operating revenue

(Millions of yen)

Japan

ASEAN

China

Other

Total

7,896,403

347,498

261,698

98,309

8,603,910

Note:

Operating revenues are based on the location of customers and classified into countries or regions.

(2) Property, buildings and equipment

(Millions of yen)

Japan

ASEAN

China

Other

Total

2,478,862

342,067

229,476

12,510

3,062,916

3. Information by major customer

The information is omitted here because no customer accounts for more than 10% of the operating revenue on the Consolidated Statement of Income.

[Impairment loss on non-current assets by reportable segment]

Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

The information is omitted here because the same information is presented in the "Segment Information" above.

Year ended February 28, 2021 (March 1, 2020 - February 28, 2021)

The information is omitted here because the same information is presented in the "Segment Information" above.

32

[Amortization for and unamortized balance of goodwill by reportable segment]

Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

(Millions of yen)

Reportable segment

Health &

Financial

Shopping

Services and

GMS

Supermarket

Center

Specialty

Wellness

Services

Development

Store

Amortization for the fiscal

2,242

2,313

4,147

1,910

2,628

849

year ended Feb. 29, 2020

Balance at Feb. 29, 2020

13,593

26,712

52,215

15,413

18,279

7,325

Reportable segment

Other

Adjustments

Total

International

Total

Amortization for the fiscal

193

14,285

-

23

14,309

year ended Feb. 29, 2020

Balance at Feb. 29, 2020

436

133,977

-

11

133,989

Year ended February 28, 2021 (March 1, 2020- February 28, 2021)

(Millions of yen)

Reportable segment

Health &

Financial

Shopping

Services and

GMS

Supermarket

Center

Specialty

Wellness

Services

Development

Store

Amortization for the fiscal

2,247

2,300

4,397

1,647

2,572

776

year ended Feb. 28, 2021

11,588

24,331

51,020

14,039

15,367

5,313

Balance at Feb. 28, 2021

Reportable segment

Other

Adjustments

Total

International

Total

Amortization for the fiscal

97

14,039

-

11

14,051

year ended Feb. 28, 2021

Balance at Feb. 28, 2021

-

121,659

-

-

121,659

[Gain on negative goodwill by reportable segment]

Year ended February 29, 2020 (March 1, 2019 - February 29, 2020)

Not applicable

Year ended February 28, 2021 (March 1, 2020 - February 28, 2021)

Not applicable

33

(Per Share Information)

Year ended

Year ended

February 29, 2020

February 28, 2021

(March 1, 2019 -

(March 1, 2020 -

February 29, 2020)

February 28, 2021)

Net assets per share (yen)

1,264.63

1,147.56

Earnings (loss) per share (yen)

31.88

(84.06)

Earnings per share - fully diluted (yen)

31.83

-

(Note) Even though the Company has dilutive shares, earnings per share - fully diluted for the fiscal year ended February 28, 2021 is not indicated because a net loss per share was recorded for the period.

(Note) Data for calculation 1. Net assets per share

February 29, 2020

February 28, 2021

Total net assets on the consolidated balance sheets

1,849,278

1,755,776

(millions of yen)

Net assets attributable to common shares

1,064,515

970,321

(millions of yen)

Main component of difference:

783,056

783,904

Non-controlling interests (millions of yen)

Number of common shares issued

871,924

871,924

(thousands of shares)

Number of common shares in treasury

30,162

26,370

(thousands of shares)

Number of common shares used for calculation of

net assets per share

841,762

845,553

(thousands of shares)

2. Earnings per share and earnings per share - fully diluted

Year ended

Year ended

February 29, 2020

February 28, 2021

(March 1, 2019 -

(March 1, 2020 -

February 29, 2020)

February 28, 2021)

Profit (loss) attributable to owners of parent

26,838

(71,024)

(millions of yen)

Amount not attributable to common shareholders

-

-

(millions of yen)

Profit (loss) attributable to common shares of

26,838

(71,024)

parent (millions of yen)

Average number of common shares outstanding

841,731

844,964

(thousands of shares)

Main components of adjustment for profit

attributable to owners of parent used to calculate

earnings per share - fully diluted (millions of yen)

Changes in equity interest resulting from

issuance of subscription rights to shares by

(35)

-

consolidated subsidiaries

Adjustment for profit attributable to owners of

ሺ35ሻ

-

parent (millions of yen)

Increase in the number of common shares used to

calculate earnings per share - fully diluted

267

-

(thousands of shares)

Residual securities not included in the calculation

for earnings per share - fully diluted because they

-

-

have no dilutive effect

Note: The average number of common shares outstanding for the fiscal year ended February 28, 2021 does not include the Company's common shares held by the Employee Stock Ownership Plan Trust (the number of shares that trust held as of February 29, 2020 was 5,626 thousand shares; as of February 28, 2021, 4,388 thousand shares). The average number of common shares held by the trust was 230 thousand shares for the fiscal year ended February 29, 2020, and 4,983 thousand shares for the fiscal year ended February 28, 2021.

34

(Material Subsequent Events)

Corporate bonds issued by a consolidated subsidiary

Aeon Mall Co., Ltd., a consolidated subsidiary of the Company, issued unsecured bonds. The details are outlined below.

Aeon Mall Co., Ltd.

(1)

Name of bonds

Unsecured Bonds (with special pari passu conditions among bonds)

series 27

(2)

Total amount of bonds

30,000 million yen

(3)

Denomination per bond

1 million yen

(4)

Coupon rate

0.39%

(5)

Issue price

100 yen per face value of 100 yen

(6)

Date of issuance

March 31, 2021

(7)

Method and due date for

Bullet bond, where the entire face value is paid at once on the maturity

the redemption

date of March 31, 2026.

(8)

Collateral

No collateral or guarantee is pledged, and no assets are specifically

reserved to secure the bonds.

(9)

Use of proceeds

The proceeds will be used for repayment of borrowings.

35

Disclaimer

AEON Co. Ltd. published this content on 27 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 April 2021 06:34:03 UTC.


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Sales 2022 8 752 B 78 431 M 78 431 M
Net income 2022 27 384 M 245 M 245 M
Net Debt 2022 1 868 B 16 735 M 16 735 M
P/E ratio 2022 92,5x
Yield 2022 1,21%
Capitalization 2 514 B 22 658 M 22 529 M
EV / Sales 2022 0,50x
EV / Sales 2023 0,50x
Nbr of Employees 155 578
Free-Float 84,5%
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Technical analysis trends AEON CO., LTD.
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Income Statement Evolution
Consensus
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Mean consensus UNDERPERFORM
Number of Analysts 8
Last Close Price 2 995,00 JPY
Average target price 2 525,00 JPY
Spread / Average Target -15,7%
EPS Revisions
Managers and Directors
Akio Yoshida Executive President & Director
Akinori Yamashita Director, Head-Finance & Business Administration
Motoya Okada Executive Chairman
Takashi Tsukamoto Independent Outside Director
Tsunetaro Ono Independent Outside Director
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