Hard Off : Consolidated Financial Results for the Three Months Ended June 30, 2021(Under Japanese GAAP)

Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail.

August 5, 2021

Consolidated Financial Results

for the Three Months Ended June 30, 2021

(Under Japanese GAAP)

Company name:	HARD OFF CORPORATION Co., Ltd.
Listing:	Tokyo Stock Exchange
Securities code:	2674
URL:	https://www.hardoff.co.jp/
Representative:	Taro Yamamoto, Representative Director and President
Inquiries:	Tsuyoshi Nagahashi, Senior Managing Director, General Manager of president's office,
	and General Manager of Management Administration Headquarters
Telephone:	[phone]

Scheduled date to file quarterly securities report:	August 12, 2021
Scheduled date to commence dividend payments:	-
Preparation of supplementary material on quarterly financial results: Yes
Holding of quarterly financial results briefing:	None

(Yen amounts are rounded down to millions, unless otherwise noted.)

1. Consolidated financial results for the three months ended June 30, 2021 (from April 1, 2021 to June 30, 2021)

(1) Consolidated operating results (cumulative)		(Percentages indicate year-on-year changes.)
	Net sales		Operating profit	Ordinary profit	Profit attributable to
		owners of parent
Three months ended	Millions of yen		%	Millions of yen	%	Millions of yen	%	Millions of yen	%
June 30, 2021	5,965		26.5	352	301.9	382	200.7	349	419.6
June 30, 2020	4,716		(4.4)	87	(67.7)	127	(62.4)	67	(76.0)

Note: Comprehensive income	For the three months ended June 30, 2021:	¥374 million	[62.0%]
		For the three months ended June 30, 2020:	¥231 million	[(57.0)%]
	Basic earnings	Diluted earnings
		per share	per share
Three months ended		Yen	Yen
June 30, 2021		25.21	-
June 30, 2020		5.03	-

(2) Consolidated financial position

	Total assets	Net assets	Equity-to-asset ratio
As of	Millions of yen	Millions of yen	%
June 30, 2021	17,863	12,927	72.1
March 31, 2021	18,105	13,039	71.8
Reference: Equity
As of June 30, 2021:	¥12,880 million
As of March 31, 2021:	¥12,996 million

2. Cash dividends

				Annual dividends
	First quarter-end	Second quarter-end		Third quarter-end	Fiscal year-end	Total
	Yen	Yen		Yen	Yen	Yen
Fiscal year ended	-	0.00		-	35.00	35.00
March 31, 2021
Fiscal year ending	-
March 31, 2022
Fiscal year ending		0.00		-	35.00	35.00
March 31, 2022
(Forecast)

Note: Revisions to the forecast of cash dividends most recently announced: None

3. Consolidated earnings forecasts for the fiscal year ending March 31, 2022 (from April 1, 2021 to March 31, 2022)

(Percentages indicate year-on-year changes.)

	Net sales		Operating profit	Ordinary profit	Profit attributable to	Basic
		earnings per
		owners of parent
								share
	Millions of		%	Millions of	%	Millions of	%	Millions of	%	Yen
	yen		yen	yen	yen
Six months ending	11,750		22.2	520	50.3	575	50.7	400	84.4	28.82
September 30, 2021
Fiscal year ending	24,000		12.8	1,200	50.8	1,300	46.6	700	101.1	50.43
March 31, 2022
Note: Revisions to the earnings forecasts most recently announced: None

* Notes

1. Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in the change in scope of consolidation): None
2. Adoption of accounting treatment specific to the preparation of quarterly consolidated financial statements: None
3. Changes in accounting policies, changes in accounting estimates, and restatement
4. 1. Changes in accounting policies due to revisions to accounting standards and other regulations: Yes
   2. Changes in accounting policies due to other reasons: None
   3. Changes in accounting estimates: None
   4. Restatement: None
5. Number of issued shares (common shares)
6. 1. Total number of issued shares at the end of the period (including treasury shares)

As of June 30, 2021	13,954,000 shares
As of March 31, 2021	13,954,000 shares

(ii) Number of treasury shares at the end of the period

As of June 30, 2021	73,979 shares
As of March 31, 2021	73,979 shares

1. Average number of shares outstanding during the period (cumulative from the beginning of the fiscal year)

Three months ended June 30, 2021	13,880,021 shares
Three months ended June 30, 2020	13,403,119 shares

• Quarterly financial results reports are exempt from quarterly review conducted by certified public accountants or an audit corporation.
• Proper use of earnings forecasts, and other special matters (Caution regarding forward-looking statements and others)
  Forward-looking statements, including the earnings forecasts stated in these materials, are based on information currently available to the Company and certain assumptions deemed reasonable. These forward-looking statements are not guarantees of future performance. Actual results may differ materially from these forecasts due to a variety of reasons.
  Please refer to "1. Qualitative information regarding financial results for the three months ended June 30, 2021, (3) Explanation of consolidated earnings forecasts and other forward-looking statements" on page 3 of the attached material for the suppositions that form the assumptions for earnings forecasts and cautions concerning the use thereof.
  (How to obtain supplementary material on quarterly financial results)
  Supplementary material on quarterly financial results was disclosed on the same day on TDnet.

	HARD OFF CORPORATION Co., Ltd. (2674)
Attached Material
	Index
1. Qualitative information regarding financial results for the three months ended June 30, 2021 ...............	2
(1)	Explanation of operating results.........................................................................................................	2
(2)	Explanation of financial position........................................................................................................	2
(3)	Explanation of consolidated earnings forecasts and other forward-looking statements.....................	3
2. Quarterly consolidated financial statements and significant notes thereto ...............................................	4
(1)	Quarterly consolidated balance sheet .................................................................................................	4
(2)	Quarterly consolidated statement of income and quarterly consolidated statement of comprehensive
	income ................................................................................................................................................	6
	Quarterly consolidated statement of income ......................................................................................	6
	Quarterly consolidated statement of comprehensive income .............................................................	7
(3)	Notes to quarterly consolidated financial statements .........................................................................	8
	Notes on premise of going concern ....................................................................................................	8
	Notes on significant changes in the amount of shareholders' equity..................................................	8
	Changes in significant subsidiaries during the period ........................................................................	8
	Changes in accounting policies ..........................................................................................................	8

- 1 -

HARD OFF CORPORATION Co., Ltd. (2674)

1. Qualitative information regarding financial results for the three months ended June 30, 2021

1. Explanation of operating results
   During the three months ended June 30, 2021, the Japanese economy continued to be impacted by the spread of the novel coronavirus disease (COVID-19) and the economic outlook remains uncertain. Under such conditions, HARD OFF CORPORATION Co., Ltd. (the "Company") has been pushing ahead with the enhancement of human resource development and expansion of the procurement channel while setting "Work in Real-Time-Back to the Basics, Have Fun and Smile-" as the annual theme. By carrying out initiatives such as establishing the Pickup Buying Center for the Metropolitan Area and promoting procurement activities at temporary locations for a limited period of time in areas without permanent stores, the Company aims to enhance its procurement capability, which is a key factor for the Secondhand Business.
   With respect to the opening of secondhand stores during the three months ended June 30, 2021, the Company opened three directly operated stores and closed two franchised stores. As a result, the total number of secondhand stores was 914, which was comprised of 392 directly operated stores and 522 franchised stores.
   The number of stores by business category as of June 30, 2021 is shown in the following table.

										(Stores)
									Total
Number of	HARD	OFF	MODE	Garage	Hobby	Liquor	BOOK	Overseas	number of	BOOK
stores	OFF	HOUSE	OFF	OFF	OFF	OFF	OFF	secondhand	ON
									stores
Directly	130	122	22	11	47	4	51	5	392	3
operated
[+1]	[+2]	[±0]	[±0]	[±0]	[±0]	[±0]	[±0]	[+3]	[±0]
stores
Franchised	232	200	3	5	74	1	-	7	522	-
stores	[±0]	[-2]	[±0]	[±0]	[±0]	[±0]	[±0]	[-2]
Total	362	322	25	16	121	5	51	12	914	3
[+1]	[±0]	[±0]	[±0]	[±0]	[±0]	[±0]	[±0]	[+1]	[±0]
Notes: 1.	Figures in square brackets [ ] indicate the increase or decrease in the number of stores during the period.

1. The stores operated by the Company's subsidiaries HARD OFF Family Co., Ltd. and ecoplus Co., Ltd. are included in the number of directly operated stores.
2. The stores operated by the Company's subsidiaries ECO TOWN HAWAII INC., HARD OFF TAIWAN INC. and ECO TOWN USA INC. are included in the number of directly operated overseas stores.

With respect to the operating results for the three months ended June 30, 2021, net sales for the existing stores remained strong, up 5.9% year on year. In addition, due to the contribution from the net sales of the subsidiary ecoplus Co., Ltd., which was included in the scope of consolidation from the third quarter ended December 31, 2020, consolidated net sales amounted to ¥5,965 million (up 26.5% year on year).

In terms of profit, as a result of an improvement in gross profit margin of 0.8%, an increase in gross profit of 28.0%, and an increase in selling, general and administrative expenses of 20.4%, operating profit amounted to ¥352 million (up 301.9% year on year) and ordinary profit amounted to ¥382 million (up 200.7% year on year). Furthermore, as a result of recording ¥97 million from gain on sale of investment securities as extraordinary income, profit attributable to owners of parent amounted to ¥349 million (up 419.6% year on year) and the Company achieved significant increases in the profit items.

1. Explanation of financial position Assets
   Total current assets as of June 30, 2021 amounted to ¥9,013 million, a decrease of ¥55 million compared with the end of the previous fiscal year. This was primarily due to a decrease of ¥250 million in cash and deposits, and an increase of ¥141 million in merchandise. Total non-current assets amounted to ¥8,849 million, a decrease of ¥187 million compared with the end of the previous fiscal
2. • 2 -