Zensho : 42th Annual Securities Report

Annual Securities Report

(Report pursuant to Article 24, Paragraph 1 of the Financial Instruments and Exchange Act of Japan)

The 42nd Fiscal Year (April 1, 2023, to March 31, 2024)

Zensho Holdings Co., Ltd.

This document is a translation of part of the Japanese original. The Japanese original has been disclosed in Japan in accordance with Japanese accounting standards and the Financial Instruments and Exchange Act of Japan. This document does not contain or constitute any guarantee and the Company will not compensate any losses and/or damage stemming from actions taken based on this document. In the case that there is any discrepancy between the Japanese original and this document, the Japanese original shall prevail.

Contents.
Annual Securities Report (42nd Fiscal Year)
[Cover page]	1
PART I: COMPANY INFORMATION	2
I. OVERVIEW OF COMPANY	2
1.	Summary of Business Results	2
2.	History	4
3.	Description of Business	7
4.	Subsidiaries and Associates	8
5.	Employees	14
II. BUSINESS OVERVIEW	16
1.	Management Policy, Business Environment and Issues to Be Addressed, etc	16
2.	Philosophy and Initiatives for Sustainability	18
3.	Business Risks, etc	23
4.	Management's Analysis on the Company's Financial Condition, Results of Operations and Cash Flow
	Conditions	26
5.	Material Contracts	32
6.	Research and Development	32
III. STATUS OF EQUIPMENT	33
1.	Overview of Capital Investments, etc	33
2.	Principal Facilities	33
3.	Plans for New Additions or Disposals, etc. of Facilities	36
IV. INFORMATION ON THE COMPANY	37
1.	Information on the Company's Share, etc	37
2. Acquisitions of Treasury Shares	46
3.	Dividend Policy	47
4.	Corporate Governance, etc	48
V. FINANCIAL INFORMATION	77
1.	Consolidated Financial Statements, etc	78
2.	Non-Consolidated Financial Statements, etc	132
VI: STOCK-RELATED ADMINISTRATION FOR THE COMPANY	146
VII. CORPORATE REFERENCE DATA	147
1.	Information on the Parent Company, etc	147
2.	Other Reference Information	147
PART II: INFORMATION ON CORPORATE GUARANTORS, ETC., FOR THE COMPANY	148

[Cover page]

[Document title]	Annual Securities Report
[Clause of stipulation]	Article 24, Paragraph 1 of the Financial Instruments and Exchange Act of
	Japan
[Place of filing]	Director-General, Kanto Local Finance Bureau
[Filing date]	June 28, 2024
[Fiscal year]	The 42nd term (from April 1, 2023, to March 31, 2024)
[Company name]	Kabushiki Kaisha Zensho Holdings
[Company name in English]	Zensho Holdings Co., Ltd.
[Title and name of representative]	Kentaro Ogawa, Representative Director, Chairman, President & CEO
[Address of head office]	18-1, Konan 2-chome,Minato-ku, Tokyo, Japan
[Telephone number]	[phone]
[Name of contact person]	Kiyohiko Niwa, Executive Officer, Senior General Manager of Group
	Finance and Accounting Division
[Nearest place of contact]	18-1, Konan 2-chome,Minato-ku, Tokyo, Japan
[Telephone number]	[phone]
[Name of contact person]	Kiyohiko Niwa, Executive Officer, Senior General Manager of Group
	Finance and Accounting Division
[Place for public inspection]	Tokyo Stock Exchange, Inc.
	(2-1 Nihombashi Kabutocho, Chuo-ku, Tokyo, Japan)

－1－

PART I: COMPANY INFORMATION

I. OVERVIEW OF COMPANY

1. Summary of Business Results

1. Business results of group

(Million yen, unless otherwise stated)

Term	38th	39th	40th	41st	42nd
Fiscal year-end	March 2020	March 2021	March 2022	March 2023	March 2024
Net sales	630,435	595,048	658,503	779,964	965,778
Ordinary profit	19,903	12,215	23,117	28,081	50,913
Profit attributable to owners of	11,978	2,259	13,869	13,265	30,693
parent
Comprehensive income	8,594	5,324	22,080	18,180	40,807
Net assets	86,793	85,430	104,486	115,837	214,652
Total assets	365,853	396,023	427,172	469,563	748,056
Net assets per share (yen)	563.30	560.87	679.19	761.63	1,171.76
Basic earnings per share (yen)	80.31	14.82	91.17	87.30	195.41
Diluted earnings per share (yen)	－	－	－	－	－
Shareholders' equity ratio (%)	23.7	21.5	24.2	24.6	28.7
Return on equity (%)	15.1	2.6	14.7	12.1	18.6
Price-earnings ratio (times)	25.7	191.1	31.4	45.0	33.0
Cash flows from operating	33,575	29,686	45,430	53,078	85,985
activities
Cash flows from investing	(35,188)	(23,519)	(31,550)	(35,200)	(125,387)
activities
Cash flows from financing	(25,753)	1,753	(11,986)	1,844	54,633
activities
Ending balance of cash and cash	28,928	37,643	42,414	64,690	82,171
equivalents
Number of employees	14,402	16,253	15,929	17,324	16,806
[average number of part-time	[50,148]	[51,125]	[51,118]	[56,313]	[66,418]
employees] (persons)
Notes: 1. Diluted earnings per share are	not stated, as there is no potential share with dilutive effects.

1. The Group has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc., from the beginning of the 40th term. Figures for the summary of business results from the 40th term onwards are presented after applying these accounting standards, etc.
2. The Company introduced Board Benefit Trust (BBT) in the 41st term. From the 41st term onwards, in the calculation of net assets per share, the Company shares held as trust assets for the BBT are included in the number of treasury shares deducted from the number of issued shares at the fiscal year-end, while in the calculation of basic earnings per share, those are included in the number of treasury shares deducted from the average number of shares outstanding during the period.
3. The Group has applied the "Accounting Standard for Current Income Taxes." (ASBJ Statement No. 27, October 28, 2022) and the transitional treatment as provided for in the proviso to section 20-3 from the beginning of the 42nd term. Figures for the summary of business results for the 42nd term are presented after applying these accounting standards, etc.

－2－

(2) Business results of reporting company

(Million yen, unless otherwise stated)

Term	38th	39th	40th	41st	42nd
Fiscal year-end	March2020	March2021	March2022	March2023	March 2024
Net sales	254,937	238,248	216,433	256,344	294,751
Ordinary profit	10,276	4,699	5,571	13,436	7,782
Profit	7,159	2,622	5,415	11,961	7,530
Share capital	26,996	26,996	26,996	26,996	47,497
Total number of issued shares	154,862,825	154,862,825	154,862,825	154,862,825	160,733,225
(shares)
Net assets	79,891	75,884	78,095	86,248	150,921
Total assets	350,250	360,602	373,293	400,507	535,482
Net assets per share (yen)	519.58	498.83	513.38	568.08	766.67
Dividends per share (yen)	20.00	20.00	22.00	24.00	50.00
[Interim dividend per share]	(10.00)	(10.00)	(11.00)	(12.00)	(25.00)
Basic earnings per share (yen)	48.00	17.20	35.60	78.72	43.93
Diluted earnings per share (yen)	－	－	－	－	－
Shareholders' equity ratio (%)	22.8	21.0	20.9	21.5	28.2
Return on equity (%)	10.6	3.4	7.0	14.6	6.3
Price-earnings ratio (times)	42.9	164.6	80.4	49.9	146.6
Payout ratio (%)	41.7	116.3	61.8	30.5	113.8
Number of employees	600	627	655	684	790
[average number of part-time	[129]	[146]	[144]	[109]	[115]
employees] (persons)
Total shareholder return (%)	81.2	112.0	114.0	156.4	256.5
[Benchmark: TOPIX Net Total	(90.5)	(128.6)	(131.2)	(138.8)	(196.2)
Return Index]
Highest share price (yen)	2,608	3,125	3,005	4,150	9,274
Lowest share price (yen)	1,677	1,731	2,528	2,835	3,910

Notes: 1. Diluted earnings per share are not stated, as there is no potential share with dilutive effects.

2.The highest and lowest share prices are those of the First Section of the Tokyo Stock Exchange before April 3, 2022, and of the Prime Market of the Tokyo Stock Exchange after April 4, 2022.

3.The Company has applied the "Accounting Standard for Revenue Recognition" (ASBJ Statement No. 29, March 31, 2020), etc., from the beginning of the 40th term. Figures for the summary of business results from the 40th term onwards are presented after applying these accounting standards, etc.

1. The Company introduced Board Benefit Trust (BBT) in the 41st term. From the 41st term onwards, in the calculation of net assets per share, the Company shares held as trust assets for the BBT are included in the number of treasury shares deducted from the number of issued shares at the fiscal year-end, while in the calculation of basic earnings per share, those are included in the number of treasury shares deducted from the average number of shares outstanding during the period.
2. The Company has applied the "Accounting Standard for Current Income Taxes." (ASBJ Statement No. 27, October 28, 2022) and the transitional treatment as provided for in the proviso to section 20-3 from the beginning of the 42nd term. Figures for the summary of business results for the 42nd term are presented after applying these accounting standards, etc.

－3－

2. History

Date	Event
Jun.	1982	Zensho Co., Ltd. (currently Zensho Holdings Co., Ltd.) was established, and located its head office
		annexed to Yokohama factory in Tsurumi-ku, Yokohama in Kanagawa Prefecture, Japan.
Jul.	1982	Opened its first lunchbox shop (Namamugi shop) in Tsurumi-ku, Yokohama, Kanagawa Prefecture, Japan.
Nov.	1982	Opened its first "inside a building" Sukiya (Gyudon) restaurant (Namamugi Ekimae restaurant) in
		Tsurumi-ku, Yokohama, Kanagawa Prefecture, Japan.
Jul.	1987	Opened its first freestanding type restaurant (Mito restaurant) in Mito, Ibaraki Prefecture, Japan.
Aug.	1997	Shares listed on the Japan Securities Dealers Association over-the counter market.
Sep.	1999	Shares listed on the Second Section of the Tokyo Stock Exchange.
Jul.	2000	Acquired Coco's Japan Co., Ltd. to enter the domestic restaurant business.
Oct.	2000	Established Techno Support Co., Ltd. (currently Techno Construction Co., Ltd.) to streamline furnishing
		and maintenance.
Nov.	2000	Established Global Foods Co., Ltd. (currently Zensho Tradings Co., Ltd.) to streamline raw material
		procurement.
Sep.	2001	Share listed on the First Section of the Tokyo Stock Exchange.
Jun.	2002	Established Global Table Supply Co., Ltd. to streamline procurement of consumables, equipment.
Oct.	2002	Established Hamasushi Co., Ltd., to operate sushi restaurant business.
Dec.	2002	Acquired Big Boy Japan, Inc. to expand domestic restaurant business.
Feb.	2004	Consolidated the headquarter functions and moved the head office to the current place (18-1, Konan 2-
		chome, Minato-ku, Tokyo, Japan).
Jan.	2005	Established Coco's Shanghai Co., Ltd. (currently Zensho Restaurant (Shanghai) Co., Ltd.) to operate
		Sukiya in China.
Mar.	2005	Acquired Nakau Co., Ltd. to expand the fast-food business.
Sep.	2005	Established Food Safety Pursuing Department (currently Group Food Safety Assurance Division) to
		enhance the approach to food safety.
Apl.	2006	UD Foods Co., Ltd. (currently Sanbishi Co., Ltd.) acquired soy sauce manufacturing business from
		Sanbishi Co., Ltd.
May.	2006	Established Central Analysis Center to enhance the food safety initiatives.
Jun.	2006	Established Global Pizza System Co., Ltd. (currently Tolona Japan Co., Ltd.) in the manufacturing and
		sales business to sell frozen foods for home use, etc.
Aug.	2006	Established Global Fresh Supply Co., Ltd. to streamline logistics.
Feb.	2007	Acquired United Veggies Co., Ltd., to enter the fruit and vegetable sales business.
Mar.	2007	Acquired Sunday's Sun Inc. (currently Jolly-Pasta Co., Ltd.) to expand domestic restaurant business.
		Launched fair trade initiatives in Democratic Republic of Timor-Leste.
Jul.	2007	Opened Sukiya (Gyudon) restaurant in Okinawa Prefecture and established the presence in all prefectures
		in Japan.
Aug.	2007	Acquired Inter-Vision Consortium Inc. (currently Human Logic Laboratory Co., Ltd.) to expand personnel
		strategy.
Jan.	2008	Established Zenshoen Co., Ltd. to enter the livestock business.
Jun.	2008	Established Global IT Service Co., Ltd. to streamline business through information technologies.
Aug.	2008	Established ZENSHO DO BRASIL COMERCIO DE ALIMENTOS LTDA to operate Sukiya in Brasil.
Oct.	2008	Acquired Hanaya Yohei Co., Ltd. to expand domestic restaurant business.
Dec.	2010	Established Zensho Best Crew Co., Ltd. to streamline the recruiting operation.
Feb.	2011	Established ZENSHO (THAILAND) CO., LTD. to operate Sukiya in Thailand.
May.	2011	Established Zensho Spin-Off Preparation Co., Ltd. (currently Sukiya Co., Ltd.).
Oct.	2011	Shifted to a holding company structure to start global business development and changed the corporate
		name from Zensho Co., Ltd. to Zensho Holdings Co., Ltd.
		Changed the corporate name from Zensho Spin-Off Preparation Co., Ltd. to Zensho Co., Ltd. (currently
		Sukiya Co., Ltd.).
		Established ZENSHO FOOD DE MEXICO S.A. DE C.V. to operate Sukiya in Mexico.
Dec.	2011	Established GFF CO., LTD. to expand manufacturing function.
Mar.	2012	Established ZENSHO FOODS MALAYSIA SDN. BHD. to operate Sukiya in Malaysia.
Apr.	2012	Established Zensho Business Service Co., Ltd. to promote employment of challenged persons and to
		support their self-reliance.
Oct.	2012	Established Zensho Clean Energy Co., Ltd. to conduct power generation business using natural energy
		sources and to supply and sell the electricity.
Nov.	2012	Acquired Maruya Co., Ltd. (currently JOY MART CO., LTD.) to enter retail business.
Jan.	2013	Established Zensho Rice Co., Ltd. in the manufacturing and sales business to sell brown and milled rice.

－4－

Date	Event
Apr.	2013	Established Zensho Taiwan Co., Ltd. to operate Sukiya in Taiwan.
		Established PT. ZENSHO INDONESIA. to operate Sukiya in Indonesia.
May.	2013	Acquired Pocino Foods Company in the U.S. to expand business and manufacturing function.
Oct.	2013	Acquired Maruei Co., Ltd. (currently JOY MART CO., LTD.) to expand retail business.
Dec.	2013	Established Nihon Retail Holdings, Co., Ltd. to oversee retail business.
Jan.	2014	Acquired Kaigo Service Kagayaki Co., Ltd. (currently Kagayaki Co., Ltd.) to enter the nursing care
		business.
Jun.	2014	Zensho Co., Ltd. (currently Sukiya Co., Ltd.) split off Kita-Nihon Sukiya Co., Ltd., Kanto Sukiya Co.,
		Ltd., Tokyo Sukiya Co., Ltd., Chubu Sukiya Co., Ltd., Kansai Sukiya Co., Ltd., Chu-Shikoku Sukiya Co.,
		Ltd, and Kyushu Sukiya Co., Ltd. as successor companies, to establish a local community-based restaurant
		management structure.
Aug.	2014	Acquired Owariya Co., Ltd. (currently JOY MART CO., LTD.) to expand retail business.
Oct.	2014	A Dining Co., Ltd. succeeded restaurant business and fast-food business from Zensho Co. Ltd. (currently
		Sukiya Co., Ltd.) by absorption-type split, to enable Zensho Co. Ltd. to concentrate, expand and further
		develop the Sukiya business.
Jan.	2015	Established Zensho USA Corporation to oversee Americas business.
Feb.	2015	Established Zensho Factory Holdings Co., Ltd. to oversee production department.
Apr.	2015	Established ZENSHO CooCa Co., Ltd. to introduce original e-money.
May.	2015	Established Kagayaki Nursery Facilities Co., Ltd. to operate in-house nursery facilities.
Jun.	2015	Acquired Mizushita Farm Co., Ltd. to expand livestock business.
Jul.	2015	TAG-1 Co., Ltd. succeeded restaurant business by absorption-type split and Zensho Café Co., Ltd.
		succeeded fast-food business by business transfer from A Dining Co., Ltd. to expand the business as a
		specialty restaurant.
		TR Factory Co., Ltd. succeeded manufacturing business of frozen pizza, etc. from Tolona Japan Co., Ltd.
		by absorption-type split, to streamline the operation through separation of the sales and manufacturing
		functions.
Jan.	2016	Established ZENSHO VIETNAM CO., LTD. to operate Sukiya in Vietnam.
Apr.	2016	ZENSHO ICHIBAN MALAYSIA SDN. BHD. acquired fast-food business to expand it in Malaysia.
Jul.	2016	Established Katsuan Co., Ltd. to expand fast-food business.
Sep.	2016	Kyubeiya Co., Ltd. and Setoudon Co., Ltd. succeeded fast-food business from A Dining Co., Ltd. by
		absorption-type split to expand the business as a specialty restaurant.
Nov.	2016	Acquired Royalhouse Ishioka Co., Ltd. and Senior Support Co., Ltd. to expand the nursing care business.
		Established Zensho China Holdings Co., Ltd. to oversee China business.
		Acquired Fujita Cooperation Co., Ltd. (currently JOY MART CO., LTD.) to expand retail business.
Apr.	2017	Established Zensho Insurance Service Co., Ltd. to operate non-life insurance agency services.
May.	2017	Established Olive Hill Co., Ltd. to expand restaurant business.
Jun.	2017	Established Nihon Kaigo Holdings Co., Ltd. to oversee the nursing care business.
Jul.	2017	Acquired NYEREG Co., Ltd. to expand the nursing care business.
Dec.	2017	Atack Co., Ltd. (currently JOY MART CO., LTD.) succeeded retail business by absorption-type split to
		expand it.
May.	2018	Established ZENSHO JAPANESE RESTAURANT COMPANY PTE. LTD. to expand fast-food business
		in Singapore.
Aug.	2018	Established ZENSHO (PHILIPPINES), INC. to operate Sukiya in Philippines.
Oct.	2018	Established ZENSHO HONG KONG CO., LTD. to operate Sukiya in Hong Kong.
Nov.	2018	Acquired Advanced Fresh Concepts Corp. to enter take-out sushi business in USA.
		Acquired I Medicare Co., Ltd. to expand the nursing care business.
Jan.	2019	Established Nihon Restaurant Holdings Co., Ltd. (currently Zensho Global Restaurant Holdings Co., Ltd.)
		to oversee restaurant business.
Feb.	2019	Established ZENSHO SOUTH EAST ASIA HOLDINGS PTE. LTD. to oversee Southeast Asia business.
		Established ZENSHO HOLDINGS MALAYSIA SDN. BHD. to oversee Malaysia business.
May.	2019	Acquired TCRS Restaurants Sdn. Bhd. to expand fast-food business in Malaysia.
Jun.	2019	Established JinZai Co., Ltd. to realize a society where people can co-exist with various international
		human resources.
Aug.	2019	Converted Jolly-Pasta Co., Ltd. into a wholly owned subsidiary by the share exchange (Delisted).
Dec.	2019	Established Zensho Europe Holdings B.V. to oversee Europe business.
		Acquired Worldfood To Go, S.L. to enter take-out-sushi business in Spain.
Feb.	2020	Converted Coco's Japan Co., Ltd. into a wholly owned subsidiary by the share exchange (Delisted).

－5－

Date	Event
Mar.	2020	Sukiya Honbu Co., Ltd., as the surviving company, merged with nine regional Sukiya companies, as the
		dissolving companies, to streamline Sukiya management.
		Changed the corporate name from Sukiya Honbu Co., Ltd. to Sukiya Co., Ltd.
Apr.	2020	Established Zensho Store Support Co., Ltd. to promote employment of challenged persons and to support
		their self-reliance.
Aug.	2020	Acquired Seiun Sake Brewery Co., Ltd. to enter brewing business.
Mar.	2021	Maruya Co., Ltd., as a surviving company, merged with four companies (Maruei Co., Ltd., Owariya Co.,
		Ltd., Fresh Corporation, and Atack Co., Ltd.), as the dissolving companies, to further expand the
		management of retail business.
		Changed the corporate name from Maruya Co., Ltd. to JOY MART CO., LTD.
Jun.	2021	Established Global MD Holdings Co., Ltd. to expand domestic and international procurement.
Jul.	2021	Acquired Marix Co., Ltd. to enter aquaculture business.
Sep.	2021	Established Zensho Fast Holdings Co., Ltd. (currently Zensho Global Fast Holdings Co., Ltd.) to further
		enhance Japanese specialty restaurant business.
Oct.	2021	Acquired Saito Shoten Co., Ltd. to expand manufacturing and sales business of brown and milled rice.
Mar.	2022	Acquired Igarashi Suisan Co., Ltd. to expand aquaculture business.
Apr.	2022	Established Shinagawa Design Co., Ltd. to improve UX design quality for all the Group business
		categories.
		Moved from the First Section to the Prime Market due to the revision of the market classification of the
		Tokyo Stock Exchange.
Apr.	2023	Acquired Lotteria Co., Ltd. to enter hamburger restaurant business.
May.	2023	Acquired Sushi Circle Gastronomie GmbH to enter take-out sushi business in Germany.
Sep.	2023	Acquired SnowFox Topco Limited to enter take-out sushi business in UK.

－6－

3. Description of Business

The Group consists of 168 companies, the Company and 167 subsidiaries, and conducts a broad range of business activities in the food business.

The Company falls under the category of specified listed companies, etc., and among the standards for determining insignificance of important facts with respect to insider trading regulations, numerical standards defined in comparison with the scale of the listed company will be judged based on the consolidated figures.

From the current fiscal year, the Company has changed its reporting segments. As described in "V. FINANCIAL INFORMATION,

1. Consolidated Financial Statements, etc., (1) Consolidated Financial Statements, Notes to the Consolidated Financial Statements, (Segment Information, etc.).

1. Global Sukiya segments (share of the Group sales: 27.5%)

Sukiya Co., Ltd., and its overseas subsidiaries such as Zensho Restaurant (Shanghai) Co., Ltd. directly operates "Sukiya," a Gyudon restaurants chain across Japan, China, Southeast Asia and Central and South America to provide safe, delicious food at affordable prices to a broad range of customers which are included families.

(2) Global Hamasushi segments (share of the Group sales: 20.4%)

Hamasushi Co., Ltd. and its overseas subsidiaries such as Zensho Restaurant (Shanghai) Co., Ltd. directly operates "Hamasushi" sushi restaurants chain across mainly in Japan and China. In addition to sushi using fresh seafood, the chain offers a wide range of side dishes such as noodles, desserts and drinks, which are enjoyed by both children and adults.

(3) Global Fast Food segments (share of the Group sales: 25.2%)

Nakau Co., Ltd. operates both directly-operated and franchised restaurants of "Nakau," oyakodon rice bowl dishes and Kyoto style udon noodle chain.

Lotteria Co., Ltd. operates both directly-operated and franchised restaurants of "Lotteria," hamburger chain. A Dining Co., Ltd. directly operates ramen specialty restaurants "Denmaru," etc. mainly in Kanto regions. Katsuan Co., Ltd. directly operates "Katsuan," tonkatsu specialty restaurants mainly in Kanto and Chubu regions.

Kyubeiya Co., Ltd. directly operates "Kyubeiya" restaurants, which offer Musashino udon noodle, tempura, and shabushabu, in Kanto region.

Setoudon Co., Ltd. directly operates" Setoudon," etc. Sanuki udon noodle specialty self-service restaurants mainly in Kanto region.

Zensho Café Co., Ltd. directly operates "Moriba Coffee," etc. a café chain which offers fair trade coffee, mainly in Kanto region.

TCRS Restaurants Sdn. Bhd. directly operates "The Chicken Rice Shop," etc. chicken rice specialty chain restaurants, in Malaysia.

"AFC" and "Zenshi" of Advanced Fresh Concepts Corp., "sushicircle" of Sushi Circle Gastronomie GmbH, "SNOWFOX"," Bento"," Taiko," "Yo!" and "SNOWFRUIT" of SnowFox Topco Limited operates both directly-operated and franchised take-out sushi stores, etc.

(4) Restaurants segments (share of the Group sales: 14.6%)

Coco's Japan Co., Ltd. offers both directly-operated and franchised restaurants of "Coco's," a standard restaurant chain across Japan.

Big Boy Japan Inc. directly operates hamburger steak and steak restaurant chain. It operates "BigBoy" etc. mainly in Kanto, Kansai and Tohoku regions, and "Victoria Station" restaurants in Hokkaido region.

Jolly-Pasta Co., Ltd. directly operates "Jolly Pasta," pasta specialty restaurant chain, mainly in Kanto and Kansai regions. TAG-1 Co., Ltd. directly operates "Jukusei Yakiniku Ichiban", etc., barbeque restaurants mainly in Kanto and Kansai regions. Olive Hill Co., Ltd. directly operates "OLIVENOOKA," specialty Italian restaurant chain in Kanto region.

Hanaya Yohei Co., Ltd. directly operates "Hanaya Yohei," Japanese-cuisine restaurants, etc. in Kanto region.

1. Retail segments (share of Group sales: 8.1%) JOY MART CO., LTD. operates supermarkets.
   United Veggies Co., Ltd. is mainly engaged in the sale of fruits and vegetables.

－7－

1. Corporate and Support segments (share of Group sales: 0.5%) GFF CO., LTD. is mainly engaged in the production of foods.
   Zensho Tradings Co., Ltd. is mainly engaged in the procurement and sale of food materials. Global Fresh Supply Co., Ltd. is mainly engaged in the nationwide distribution of food materials.
   Techno Construction Co., Ltd. is mainly engaged in the construction of restaurant and store facilities and maintenance. Global Table Supply Co., Ltd. is mainly engaged in the sale of equipment and uniforms.
2. Other segments (share of Group sales:3.7%)

Tolona Japan Co., Ltd. is mainly engaged in the sale of frozen foods for home use, etc.

Sanbishi Co., Ltd. is mainly engaged in the production and sale of soy sauce and other seasonings. Kagayaki Co., Ltd. is mainly engaged in nursing care business.

Zensho Rice Co., Ltd. is mainly engaged in the sale of brown and milled rice.

The following chart illustrates the business structure of the Group.

－8－