ANNUAL REPORT 2019 Dessert Okoku cafes. create restaurants inc. Shabu SAI Dessert Okoku Station buildings and commercial facilities Create Dining operates restaurants and cafes mainly

Stock Code : 3387

Year Ended February 28, 2019

ANNUAL REPORT 2019

010_0170901371909.indd 2 2019/09/20 19:24:25

FY2017FY2015FY2013FY2011FY2009FY2007FY2005FY2003FY2001FY1999 FY2019

103,271113,525

52,52334,62437,734

38,889

26,780

11,4223,7481,248

Business Environment (as of February 28, 2019)

Number of Group companies: 13 in Japan and 9 overseas

Capital stock: 1,012 million yen

Number of outlets: 891 in Japan and 34 overseas

Number of brands: 218

Number of employees: 25,996

1999Started the restaurant business (May)Opened 5 restaurants, including the Italian restaurant Portofino in Daiba, Tokyo

2000Opened bulk opera-tion food court Food Bazaar in Gotemba Premium Outlet Mall

2005Opened the 1,600-seat Festival Food Court at the EXPO 2005 AichiListed on the Mothers section of the Tokyo Stock Exchange

2004Opened 100th restau-rant

2007Start of operation of subsidiary Create Kiss-ho Inc., a joint venture with KISSHO Co., Ltd.

2008Established joint venture Shanghai Yuyuan Tourist Mart Create Restaurants Management Co., Ltd.

2010Changed company name to create restau-rants holdings inc.Established subsidiary create restaurants japan inc. (current name: create restau-rants inc.)Opened a restaurant at the Expo 2010 Shanghai through Shanghai Yuyuan Tourist Mart Create Restaurants Manage-ment Co., Ltd.Established subsidiary create restaurants china Limited in Hong Kong

2011Established subsidiary create restaurants asia Pte Ltd. in SingaporeEstablished subsidiary create restaurants Shanghai co. ltd. in Shanghai, China as a wholly owned subsidiary of create restaurants china Limited

2012Acquired all shares of LE MONDE DES GOURMET INC. and made it a wholly owned subsidiary of create restaurants hong kong Ltd. as a wholly owned subsidiary of create restaurants china Limited

2013Acquired 74.6% of the shares of SFP Dining Co., Ltd. and made it a subsidiaryAcquired all shares of eatwalk Co., Ltd. and made it a wholly owned subsidiaryChanged the stock listing to the First Section of the Tokyo Stock Exchange

2014Acquired all shares of YUNARI Co., Ltd. and made it a wholly owned subsidiary Established subsidiary Create Restaurants Taiwan Co., Ltd. in Taiwan Acquired 99.97% of the shares of R21 Cuisine Co., Ltd., made it a consolidated subsidiary, and changed its trade name to Shanghai Bishoku Chushin Co., Ltd.Consolidated subsidiary SFP Dining Co., Ltd. listed on the Second Section of the Tokyo Stock Exchange

2015Through a joint incorporation-type company split (simplified corporation separation), the Company and con-solidated subsidiary create restaurants inc. established Gourmet Brands Company inc.Acquired 99.8% of the shares of KR Food Ser-vice Corporation and made it a consolidated subsidiaryAcquired all shares of RC JAPAN Co., Ltd. and made it a wholly owned subsidiary

2016Established subsidiary Create Restaurants NY Inc. in New YorkEstablished subsidiary Create Dining inc. through reorganiza-tion within the Group

2017SFP Dining Co., Ltd. transitioned to a holding company system and changed its company name to SFP Holdings Co., Ltd.

2018Acquired 51.0% of the shares of Route 9g Inc. and made it a subsidiary Acquired all shares of Create Bayside Inc. and made it a subsidiaryThe operations of two restaurants Aburiya Kinnosuke and Soba Totto were transferred to Create Restaurants NY Inc. Acquired all shares of Hashimoto Inc., made it a subsidiary, and changed its company name to YUZURU Inc. KR Food Service Corporation transi-tioned to a holding

company system and changed its company name to KR Holdings Corporation

2019SFP Holdings Co., Ltd. transferred its listing to the first section of the Tokyo Stock ExchangeTransition of create

restaurants holdings

M&A

Overseas development

Number of outlets

Net Sales (Millions of Yen)

100FY2004

outlets

300FY2006

outlets

500FY2014

outlets

Group Federation Management startedMulti-brand, multi-location strategy

The growth potential of create restaurants holdings

Route 9g Inc.

Create Kissho Inc. Shanghai Yuyuan Tourist Mart Create Restaurants Management Co., Ltd. (joint-venture company) (Shanghai)

create restaurants Shanghai co. ltd. (Shanghai)

create restaurants china Limited (Hong Kong)

create restaurants asia Pte.Ltd (Singapore)

Create Restaurants NY Inc.

Create Dining inc. (reorganization within the Group)

LE MONDE DES GOURMET INC.

create restaurants hong kong Ltd. (Hong Kong)

SFP Dining Co., Ltd.

eatwalk Co., Ltd.

Create Restaurants Taiwan Co., Ltd.

YUNARI Co., Ltd

Shanghai Bishoku Chushin Co., Ltd.

Gourmet Brands Company inc. (company split)

RC JAPAN Co., Ltd.

KR FOOD SERVICE CORPORATION

925outlets

Number of outlets

FY2019President & CEO Haruhiko Okamoto and Chairman Hitoshi Gotoh jointly founded create restaurants holdings inc. in May 1999.

Instead of taking the chain-store approach, which was dominant at that time, the Company adopted a strategy emphasizing

location rather than brand and brought a breath of fresh air to the restaurant industry and subsequently expanded its business.

In recent years, create restaurants holdings is proactively conducting M&A to further expand its business.

New Credo

We will grow around the world by continuously challenging and opening opportunities

We will always challenge with speed and creativity

We will create value through respectful and collaborative interaction among each unique business units

As a leading company, we will innovate to create a new future for the restaurant industry

We will contribute to society by providing colorful dining experiences to customers

* Effective from the fiscal year ended February 28, 2019, the Group adopted the International Financial Reporting Standards (IFRS). Accordingly, the figures for FY2019 are presented in accordance with IFRS.

119,281Million Yen

Revenue

*

Net Sales / Revenue

(on a consolidated basis)(including 22,158 part-time employees)

Create Bayside Inc.

Aburiya Kinnosuke Soba Totto

YUZURU Inc.

01ANNUAL REPORT 2019

America

Japan

Singapore

Hong Kong

Taiwan

Operating Companies and Brands

total 218brands925outlets

Domestic

891outlets

Overseas

34outlets

Development of formats attuned to location characteristicsThe create restaurants group plans and develops restaurants in a wide variety of formats ranging from casual food courts and izakaya to restaurants offering a more formal dining experience. When we create a restaurant format, we consider the characteristics of the location, occasions for use, and customer demographics; for instance, whether the location is a suburban shopping center, urban commercial facility, urban street front, downtown district, or suburban roadside.

As of February 28, 2019, we operated a total of 925 restaurants under 218 brands, including restaurants for Japanese cuisine such as sushi and shabu-shabu, Italian restaurants, cafes, Korean barbecue restaurants, Chinese restaurants, ramen restaurants, and dessert cafes.

Global business developmentThe Group currently operates restaurants in Asia, including in Singapore, Hong Kong, and Taiwan, and in North America (New York). In Asia, we mainly operate brands of Japanese cuisine (“washoku”), such as Shabu SAI shabu-shabu restaurants and MACCHA HOUSE cafes using traditional Japanese maccha (powdered green tea), which have been well-received. In North America, our restaurants include SushiNao, a modern Japanese sushi restaurant, and Aburiya Kinnosuke, a “robatayaki” grill restaurant.

Shopping centers

Based on its multi-brand, multi-location strategy, create restaurants operates outlets located primarily at large suburban shopping centers. Its diverse portfolio of brands ranges from all-you-can-eat buffet restaurants such as Shabu SAI specializing in shabu-shabu and Dessert Okoku cafes.

create restaurants inc.

Dessert OkokuShabu SAI

Station buildings and commercial facilities

Create Dining operates restaurants and cafes mainly at commercial facilities in the Tokyo Metropolitan area. Its sophisticated, wide-ranging high-end brands include HINA SUSHI upscale all-you-can-eat sushi restaurants.

Create Dining inc.

HINA SUSHI

LE MONDE DES GOURMET operates restaurants located primarily in department stores and other commercial facilities. Its brands are mainly Italian, including TANTO TANTO authentic Italian restaurants.

LE MONDE DES GOURMET INC.

TANTO TANTO

eatwalk Co., Ltd.eatwalk operates restaurants emphasizing vegetables that are located primarily in urban commercial facilities, such as Shin-Marunouchi Building. Its brands include AW kitchen Italian restaurants serving dishes made with lots of tasty, fresh vegetables, as well as other brands with an emphasis on vegetable dishes.

AW kitchen

Gourmet Brands Company operates outlets mainly at urban commercial facilities such as GINZA SIX. Its brands include JEAN FRANCOIS bakery cafes.

Gourmet Brands Company inc.

JEAN FRANCOIS

Create Bayside operates restaurants, mainly in IKSPIARI, a commercial complex adjacent to Tokyo Disney Resort. Its brands include Rainforest Cafe, which is an entertainment-style restaurant.

Create Bayside Inc.

Rainforest Cafe

Roadside

KR HOLDINGS mainly operates outlets at suburban roadside locations. Its brands include Kagonoya Japanese restaurants designed to appeal to people of every generation.

KR HOLDINGS CORPORATION

Kagonoya

Station front and downtown

SFP Holdings operates izakaya mainly in downtown districts in Tokyo, such as Shinjuku, Shibuya, and Ueno. Its brands include ISOMARU SUISAN seafood izakaya serving grilled fresh seafood dishes around the clock.

SFP Holdings Co., Ltd.

ISOMARU SUISAN

YUNARI operates outlets mainly at roadside locations and commercial facilities on the outskirts of Tokyo. Its brands include Tsukemen TETSU, the brand that led the tsukemen boom.

YUNARI Co., Ltd

Tsukemen TETSU

Route 9g operates outlets at street level in downtown Tokyo, such as in Azabu and Ebisu. Hainan Jeefan Shokudo, well-known restaurants specializing in Singaporean cuisine, is its brand.

Route 9g Inc.

Hainan Jeefan Shokudo

New members that joined the Group in or after 2018

YUZURU operates outlets mainly at roadside locations in Hokkaido. Its brands include YUZURU, which is well known for soba noodles called Gomasoba.

YUZURU Inc. (Joined the Group in December 2018)

YUZURU

Kiya Foods operates outlets mainly at street level in Ginza,Tokyo. Its brands include Ginza Kiya udon and soba restaurants.

Kiya Foods Co., Ltd. (Joined the Group in March 2019)

Ginza Kiya

Create Restaurants NY operates outlets in North America, focusing on downtown districts of New York. Its brands include Japanese restaurant Aburiya Kinnosuke.

Create Restaurants NY Inc.

Aburiya Kinnosuke

Overseas

create restaurants asia operates Japanese restaurants mainly at large shopping centers in Singapore. Its brands include Shabu SAI all-you-can-eat buffet restaurants specializing in shabu-shabu.

create restaurants asia Pte. Ltd.

Shabu SAI

create restaurants hong kong operates outlets mainly at shopping centers in Hong Kong. Its brands include MACCHA HOUSE cafes specializing in food and drinks using maccha (powdered green tea).

create restaurants hong kong Ltd.

MACCHA HOUSE

Create Restaurants Taiwan operates MACCHA HOUSE cafes based on the theme of maccha (powdered green tea) in downtown districts in Taiwan.

Create Restaurants Taiwan Co., Ltd.

MACCHA HOUSE

CLOOC DINING CO., LTD. (Joined the Group in July 2019 as a result of M&A by SFP)

CLOOC DINING operates outlets mainly at street level in downtown districts in Nagano Prefecture. Its brands include Karaage Center restaurants specializing in Japanese-style fried chicken.

Karaage Center

Joh Smile operates outlets mainly at street level in downtown districts in Kumamoto Prefecture. Its brands include Maekawa Suigun izakaya.

Joh Smile Corporation (Joined the Group in March 2019 as a result of M&A by SFP)

Maekawa Suigun

02 03create restaurants holdings inc. ANNUAL REPORT 2019

Message from the Management

Marking the 20th Anniversary

Haruhiko Okamoto

President & CEO

Subsequently, the three revised major laws for community

development came into force in 2007, resulting in fewer openings

of shopping malls and thus in the Group opening fewer outlets.

Therefore, we judged that autonomous opening of new outlets

would be impossible without changing the strategy and

transitioned to a holding company system in 2010 and a new

strategy called “Group Federation Management.”

The basic strategy of “Group Federation Management” is

threefold: 1) organic outlet openings, 2) quality M&A in Japan

and overseas, and 3) further global expansion into North America

and new markets in the ASEAN region.

Of these strategies, the second item, promotion of M&A

became a major engine for our growth. In the years from 2012 to

2019, we executed 13 M&A deals and our scope of business

expanded rapidly as a result of large-scale M&A deals, especially,

the acquisitions of SFP Holdings in 2013 and KR Holdings in 2015.

The most recent M&A deals include the acquisition of Kiya

Foods Co., Ltd. in March 2019, which operates 7 outlets,

including Ginza Kiya udon and soba restaurants mainly in Ginza,

Tokyo. Through our subsidiary SFP, Joh Smile Corporation which

operates 19 outlets, including Maekawa Suigun izakaya in

Kumamoto, joined the Group.

Shifting to Group Federation Management by adopting a holding company system

When we launched the business in 1999, increasing the number

of outlets based on a chain-store approach was a dominant

strategy in the restaurant industry. As a latecomer to the

restaurant industry without a powerful established brand, we

judged that we would have no chance if we adopted the same

strategy as major chain operators. We, therefore, decided to

emphasize the location rather than the brand and thus create a

brand suitable for the location. This was the origin of our multi-

brand, multi-location strategy.

What locations would attract customers but little competition?

Commercial facilities, such as shopping malls and outlet malls,

which were increasing at that time, were the ideal locations. By

developing brands attuned to the needs of the developer of each

shopping facility, we created and operated original brands unique

to the facilities. Responding to the needs of the developers gave

us opportunities to open outlets at numerous commercial

facilities subsequently, leading to a rapid increase in the number

of outlets.

Number of outlets increased based on the multi-brand, multi-location strategy that we have been pursuing since our foundation

From the fiscal year ending February 29, 2020, through further

evolution of Group Federation Management, we will pursue

sustainable, powerful growth with the aim of achieving annual

revenue of 200 billion yen over the medium to long term.

Specifically, we will continue to vigorously investigate M&A

opportunities in Japan and overseas. Especially Overseas, our

focus is on promoting M&A opportunities in North America. By

tackling new genres, experiences, etc. while utilizing the

“business format development capabilities” the Group has

cultivated so far, we will develop a business portfolio with rich in

specialization and diversity to secure competitiveness. Moreover,

we will further strengthen horizontal ties among Group

companies and increase the flexibility of our outlet opening plan,

including franchising within the Group and format changes across

Group companies. At the same time, we will maximize Group

synergy by expanding joint procurement of foodstuffs commonly

used in the Group.

Further evolution of Group Federation Management

We marked our 20th anniversary in

May 2019. I would like to thank our

customers, shareholders, employees,

and all other stakeholders for their

support.

05ANNUAL REPORT 201904 create restaurants holdings inc.

Message from the Management

Our aspiration to always be of benefit to the world no matter

what kinds of companies join us is also embodied in the Group

Mission. This aspiration did not suddenly appear but is what I

have been thinking about “What kind of enterprise should the

create restaurants group become? “for a long time.

The Group Mission expresses this thinking, too.

Unlimited excitement !

Our job is to give our customers and the world exciting

experiences. But it is equally important that we, those who serve

the customers, experience this excitement, too. Not just

excitement now or in the past but continuous and expanding

excitement without limit. This is the most important thing.

Welcome diversity

Our group has diverse brands and diverse people. Customers are

diverse, too. Respect each individual and do not enforce a single

one-size-fits-all approach. Rather than having one strong or

distinct personality, it is good to have diverse people and diverse

exciting experiences coexisting. To put it in just two words,

“diverse personalities” are what we need.

Collaborate to create

It is important to work together to create value by sharing

excitement, respecting one another, and sometimes challenging

one another. By “together,” I mean not only collaboration among

staff at an outlet but also collaboration among outlets,

collaboration among companies—indeed, every imaginable type

of collaboration. People are not perfect and can make mistakes

or fail. But they are also capable of correcting mistakes and

turning failure to success. You will derive pleasure from working

together as a team. The achievement of creating something is not

the only wonderful thing. The process of collaborating and what

you feel while collaborating also have value and are wonderful.

The Group Mission expresses what all the members of the Group are working together for and what the Group aims to accomplish.

New Group Mission established, marking the 20th anniversary

Marking the 20th anniversary of the create restaurants group, we established the Group Mission and these words came up.

Surprise the world

Let's create a thrilling future together with co-workers who have

diverse personalities, sharing the excitement. I want everyone in

the group to surprise the world and themselves by “what they

become” and “what they accomplish” and our customers and

society to be surprised by “our outlets and the create restaurants

group of companies are great”.

Being surprised is being impressed.

The Group Mission is a mission shared by everyone in

the group.

If you are president of a company, while making your company’s

personality stand out, you should respect and collaborate with

other companies to create a glorious future. Restaurants should

collaborate with one another in pursuit of new development.

Head offices should collaborate beyond the borders of companies

to create new systems. “Don’t care about others” is not the right

approach. I would like to welcome new members to the Group

who share our thinking.

We sometimes work alone (one company), and we sometimes

work together with other members of the group (other

companies). This notable characteristic of the create restaurants

group makes us stand out in the restaurant industry. I am

convinced that the Group Mission we have newly established will

become the group DNA that enables us to prevail amid relentless

competition in the industry, even though it may take decades.

Unlimited excitement!Welcome diversityCollaborate to createSurprise the world


Medium Term Management PlanThe create restaurants group will continue pursuing and evolving “Group Federation Management” of multiple operating

companies with diverse specialties by establishing efficient systems and infrastructure under a holding company structure to

achieve growth as a group.

*1 FY2020 Revised Forecast states the figures announced in the Notice of Revisions to Business Forecasts on July 12, 2019.*2 Adjusted EBITDA for FY2020 Revised Forecast reflects the impact of the adoption of IFRS 16.

* The Group adopted International Financial Reporting Standards (IFRS) from the full-year results of the fiscal year ended February 28, 2019. Accordingly, the results for the fiscal year ended February 28, 2018 state both the figures converted in accordance with IFRS and those under the Japanese GAAP for reference.

FY2020 Revised Forecast FY2021 Plan FY2022 Plan

Revenue (Millions of Yen) 130,000 137,000 152,000

Growth rate 109.0% 110.5% 110.9%

Operating profit (Millions of Yen) 6,700 7,500 9,600

Profit before taxes (Millions of Yen) 6,300 6,600 8,600

Profit for the year (Millions of Yen) 4,000 4,500 5,800

Profit attributable to owners of parent (Millions of Yen) 3,300 3,700 5,000

Adjusted EBITDA (Millions of Yen) 22,700 13,500 16,100

Medium Term Management Plan (Numeric Target)

New Medium Term Management Plan

Progress

2001 2002 2003 2004 2005 2015201420132012201120102009200820072006 2016 2021201920172000

137,000

2020

130,000119,281116,522

2018(Ref.)2018

116,567

2022

152,000

J-GAAP IFRS

Medium Term Management Plan

Net sales

Three Growth Strategies

1 M&A strategy (in Japan and overseas) 2 Further strengthening of

brand creation capabilities 3 Further evolution of Group Federation Management

Three Growth Strategies

1 M&A strategy (in Japan and overseas) 2 Further strengthening of

brand creation capabilities 3 Further evolution of Group Federation Management

Target: Net sales of 152 billion yen in 2022

Recognition of the Business Environment

Diversifying customer needs; intensifying competition with other restaurants and home-meal replacement

More M&A candidates centering on businesses for succession and businesses owned by private equity funds

Securing high-quality human resources has become the most important management issue

Achieve revenue of 200 billion yen over the medium to long term

Achieve sustainable, powerful growth

In Japan, our M&A targets are companies that have brands with a competitive edge and are suitable for multi-outlet operations. Regardless of the scale of the business, we will acquire the entire operation, including human resources. We are also promoting M&A in local cities and implementing area strategies focusing on local areas based on the food alliance concept (M&A by SFP).

Overseas, our focus is on finding M&A targets in North America. We will promote a strategy of “buying time” by acquiring businesses, including local management teams. In Asia, in addition to M&A, franchising and business development through joint ventures are other options for us. We have established a department in North America to examine possible business investments. Moreover, having established the Overseas Business Division at the head office, we will further accelerate overseas expansion.

Securing competitiveness is increasingly important nowadays as one's “capabilities to respond to change” are tested. By combining our “business format development capabilities” to develop diverse brands according to the location, which we have cultivated since our foundation, with the new opening of outlets at different locations than before and various new attempts in terms of genres, experiences, etc., we will develop a business portfolio rich in specialization and diversity capable of responding to all kinds of customer needs in order to prevail in the era.

In order to maximize synergy throughout the Group, create restaurants holdings has taken the initiative in creating synergy among Group companies. Going forward, however, we will encourage Group companies to pursue mutual synergy with other Group companies. For example, the brands and the sites owned by an operating company have hitherto only been used by that operating company. However, we will increase the flexibility of our outlet opening strategy, including franchising within the Group and format changes across Group companies, as well as opening of outlets of a brand by another operating company in the Group in locations where that brand has never before opened outlets. Regarding procurement, we will strive to reduce the cost of sales ratio through joint procurement of common foodstuffs used in the Group (seasoning, alcoholic beverages, meat, wasabi, etc.) to take advantage of volume discounts.


Number of outletsOperating income (Millions of Yen)

Operating margin (%)

(Yen)Cash dividends Per share Number of brands Number of employees Number of shareholdersProfit attributable to owners of parent (Millions of Yen)

Profit attributable to owners of parent per share (Yen)

52,523

69,309

103,271113,525 116,567 116,522 119,281

2015 2016 2017 2018 2019J-GAAP IFRS

2015 2016 2017

616

795857

2018

864

2019

925

2015 2016 2017

167

197 200

2018

194

2019

218

2015 2016 2017

2,259

3,171

3,605

2018

3,508

2019

3,838

2015 2016 2017

23,373 26,397

81,388

2018

107,827

2019

119,293

6,110

3,975

6.0 6.5

5.2

4,164

6,749

5,8576,413

5.5 5.2

3.3

2015 2016 2017 2018 2019J-GAAP IFRS

68.8235.19

34.89

6,495

3,321 3,293

26.50 29.07

2,501 2,743

14.05

1,321

2015 2016 2017 2018 2019J-GAAP IFRS

2015 2016 2017

7.56

11.6713.00

2018

10.00

12.00

2019

12.00

J-GAAP IFRS

Net Sales / Revenue (Millions of Yen)

Operating income Profit attributable to owners of parent

Operating margin Profit attributable to owners of parent per share

Millions of Yen,except for Number of brands, Number of outlets and Number of employees

Thousands of U.S. Dollars

(Note)

2015 2016 2017 2018 2018 2019 2019J-GAAP J-GAAP J-GAAP J-GAAP IFRS (Ref.) IFRS IFRS

For the yearNet Sales / Revenue ¥ 69,309 ¥ 103,271 ¥ 113,525 ¥ 116,567 ¥ 116,522 ¥ 119,281 $ 1,071,037 Gross profit 49,939 73,501 80,701 83,034 82,997 84,966 762,921 Operating profit 4,164 6,749 5,857 6,413 6,110 3,975 35,699 Profit attributable to owners of parent 6,495 3,321 3,293 2,501 2,743 1,321 11,863

Cash flow from operating income / Cash flow from operating activities 6,298 10,352 10,054 11,887 11,912 8,364 75,101

Cash flow from investing income / Cash flow from investing activities (8,077) (20,540) (9,266) (5,677) (5,665) (4,886) (43,876)

Cash flow from financing income / Cash flow from financing activities 10,238 11,542 (6,241) (3,327) (3,470) (2,900) (26,039)

At year-endTotal assets ¥ 47,034 ¥ 72,530 ¥ 71,364 ¥ 72,222 ¥ 71,409 ¥ 72,459 $ 650,619 Net assets / Total equity 19,676 22,996 25,701 26,548 24,438 23,996 215,469 Number of brands 167 197 200 194 218 Number of outlets 616 795 857 864 925 Number of employees 2,259 3,171 3,605 3,508 3,838

Yen U.S. Dollars

Per share

Net income (EPS) / Basic earnings per share ¥ 68.82 ¥ 35.19 ¥ 34.89 ¥ 26.50 ¥ 29.07 ¥ 14.05 $ 126.16

Net assets (BPS) / Equity per share attributable to owners parent 161.55 185.42 206.67 213.98 191.09 175.19 1,573.04

Cash Dividends (DPS) 7.56 11.67 13.00 10.00 12.00 107.75

%

Ratio

Shareholders' equity / Total assets / Ratio of equity attributable to owners of parent 32.4 24.1 27.3 28.0 25.3 22.6

Operating margin 6.0 6.5 5.2 5.5 5.2 3.3Return on assets (ROA) 15.7 5.6 4.6 3.5 3.9 1.8Return on equity (ROE) 52.9 20.3 17.8 12.6 15.6 7.7Price earnings ratio (P/E ratio) (Times) 7.4 27.7 28.0 45.3 41.3 92.5

Notes: 1. Amounts in US dollars in this report are for convenience only. Yen amounts are translated into US-dollar amounts at the rate prevailing as of February 28, 2019, which is ¥111.37 to the US dollar. 2. EPS, BPS, and DPS are adjusted retroactively due to a share split-up in the ratio of 1 stock to 3 effective upon March 1, 2016. 3. Number of outlets includes licensed businesses, franchised stores and overseas joint ventures as of February 28, 2019.

* As for numerical management by category, the Company previously used “category profit” calculated based on ordinary income under Japanese GAAP, but in line with the adoption of IFRS from the fiscal year ended February 28, 2019, the Company changed the indicator for presentation to “category cash flow” calculated based on adjusted EBITDA.For figures presented based on Japanese GAAP, “category profits” are presented as reference figures.

* The sum of percentage sales figures for all the categories is 100.6%. However, it is excluded -0.6% for head office expenses, etc. adjustment.

create restaurants holdings inc. and Consolidated SubsidiariesYears ended the last day of February

Financial and Non-financial Highlights

CR Category SFP Category Specialty Brands Category Overseas Category

Point In FY2019, opened 21 new

outlets, including restaurants

specializing in roast beef bowl dishes

and cafes, and closed 11 outlets.


outlets, including ISOMARU SUISAN

seafood izakaya, Ichi-goro izakaya

specializing in gyoza Chinese

dumplings, and Go-no-Go Japanese-

style pubs, and closed 4 outlets.


outlets, including Kagonoya Japanese

restaurants, Azusa Coffee cafes,

Yasai-ya Mei Japanese restaurants,

and JEAN FRANCOIS bakery cafes,

and closed 8 outlets.


outlets, including Shabu SAI restaurants specializing in shabu-

shabu in Singapore and Hong Kong,

and closed 5 outlets.

Consists of restaurants and food courts operated by create restaurants, Create Dining, and Create Bayside under various brands mainly at commercial facilities.

Consists of outlets operated by SFP Holdings, with which the Company entered into a capital tie-up in April 2013. Operates izakaya in urban downtown districts.

Consists of outlets operated by seven domestic subsidiaries (LE MONDE DES GOURMET, eatwalk, YUNARI, Gourmet Brands Company, KR HOLDINGS, Route 9g, and YUZURU) mainly at suburban roadside locations and urban commercial facilities.

Japanese restaurants mainly at commercial facilities, street-front locations, and in downtown districts in Singapore, Hong Kong, Taiwan, and North America (New York).

2017

42,862

2018

43,735 45,633

2019

43,735

J-GAAP IFRS

3,710 4,050

5,4174,971

2017 2018 2019J-GAAP IFRS

3,560 3,828 4,538

5,345

2017 2018 2019J-GAAP IFRS

1,3161,674

2,953

2,205

2017 2018 2019J-GAAP IFRS

280 240

(89)(0)

2017 2018 2019J-GAAP IFRS

35,957 36,841 36,841 37,751

2017 2018 2019J-GAAP IFRS

31,530 33,177 33,65933,177

2017 2018 2019J-GAAP IFRS

3,167 2,834 2,834 2,987

2017 2018 2019J-GAAP IFRS

Net sales / Revenue (Millions of Yen) Net sales / Revenue Net sales / Revenue Net sales / Revenue

Cash flows of each category Cash flows of each category Cash flows of each category Cash flows of each category

Composition of revenue

38.3%

(Millions of Yen)

(Millions of Yen)

(Millions of Yen)

(Millions of Yen)

(Millions of Yen)

(Millions of Yen) (Millions of Yen)

31.6%


28.2%


2.5%


Effective from the fiscal year ended February 28, 2019, the Group adopted the International Financial Reporting Standards (IFRS).

However, the results for the fiscal year ended February 28, 2018 are presented both in accordance with the Japanese GAAP and the IFRS.


The Company is keenly aware of the need for business to fulfill its social responsibility and considers the pursuit of

transparent corporate activities that reflect awareness of compliance to be one of the important tasks of management.

Recognizing that enhancing and maximizing enterprise value is the fundamental objective of corporate governance for a

listed company, the Company is developing a corporate governance structure that enables fair, transparent, prompt and

appropriate management and executive decisions that accord importance to shareholder value and the fulfillment of

corporate responsibility, promoting management efficiency and continuously enhancing enterprise value. For this purpose,

the Company intends to enhance corporate governance by focusing on further enhancing and developing not only the

management structure, but also organizations and systems.

Measure to Compliance Risks

The Company has installed the following systems in order to ensure that performance of duties by Directors and employees

complies with laws and regulations and the Articles of Incorporation.

1. Based on the Code of Conduct and the Basic Rules for the Organization and Implementation of Compliance, the Company

provides periodic education and training to its officers and employees as part of efforts to ensure that they act in accordance

with laws and regulations and the Articles of Incorporation as well as social norms.

2. The Company’s President serving as the Chief Compliance Officer is making efforts to enhance compliance awareness

throughout the Company.

3. The Team Leader of the Stand-alone Accounting Team performs duties in accordance with the Accounting Rules in order to

prepare appropriate financial statements and is making efforts to ensure compliance.

4. The Company has established internal whistleblowing systems concerning compliance matters, namely, a dedicated email

contact for compliance matters and a hotline for reporting to the legal advisor, separate from the reporting line to the

department head. These systems facilitate early detection of any conduct contrary to laws and regulations as well as swift and

appropriate responses to such conduct.

5. In addition to periodic auditing of each department of the Company, the Group Internal Auditing Division periodically meets

the Chief Compliance Officer and the Audit & Supervisory Committee to exchange information.

6. The Code of Conduct requires its officers and employees to have no relationships with antisocial forces or groups that pose a

threat to the order and safety of society, or with companies, organizations, and individuals related to such antisocial forces, and

to refuse any unjust demands from them. The Company has established a system under which, in the event that antisocial

forces make any unjust demands, the responsible department manages information in an integrated manner and implements

swift countermeasures, including consultation with the competent police station.

Evaluation of the Effectiveness of the Board of Directors

The Corporate Governance Code states “Each year the board should analyze and

evaluate its effectiveness as a whole, taking into consideration the relevant matters,

including the self-evaluations of each director. A summary of the results should be

disclosed.” The Company conducted a questionnaire survey for all the Directors

including those who are Audit & Supervisory Committee Members about the

composition and operation of the Board of Directors, and the provision of

information, and Directors exchanged opinions based on the results of the

questionnaire. In light of the discussion, the Board of Directors analyzed and

evaluated its effectiveness and the Company confirmed that it is operated effectively

in order for the Company to achieve sustainable growth and enhancement of

corporate value over the medium- to long-term.

Measure to the Corporate Governance CodeExamples of Initiatives

Basic Policy on Corporate Governance

Corporate Governance Organizational Structure

Ordinary General Meeting of Shareholders

Divisions and Operating Companies

Audit & Supervisory Committee3 Directors who are Audit &

Supervisory Committee Members (of whom 2 are Outside Directors)

Directors5 members

(Excluding Audit & Supervisory Committee Members)

Executive DirectorsExecutive Operating Officers

Internal Control Systems Development Office

Accounting AuditorPresident and Representative DirectorLegal Advisor

Meeting of the Group’s Presidents

Group Internal Auditing Division

Election/dismissal

Selection/removal

Consultation/advice

Deliberation/reporting

Direction/supervision

Direction/reporting

Direction/reporting Direction/reporting

Reporting/recommendation

AuditDevelopment of internal control systems

Election/dismissal

Audit

Audit

Cooperation

Election/dismissal

Supervision

Board of Directors

Overview of Corporate Governance

Form of Organization Company with audit & supervisory committee

Chairman of the Board of Directors Haruhiko Okamoto

Number of Directors * 5

Number of Audit & Supervisory Committee Members 3, of whom 2 are Outside Directors

Appointment of Independent Officers 2 Outside Directors appointed

Total Compensation for Directors Total compensation for the fiscal year ended February 2019: 169 million yen for 5 Directors

Total Compensation for Audit & Supervisory Committee Members

Total compensation for the fiscal year ended February 2019: 17 million yen for 3 Audit & Supervisory Committee Members (of which, 7 million yen for Outside Directors)

Accounting Auditor Deloitte Touche Tohmatsu LLC* Excluding Directors who are Audit & Supervisory Committee Members

Corporate Governance


Activities of the Food Safety and Security Promotion Office

1. Preparation of rules and manuals

The office sets standards for sanitation management,

labeling, and other matters in outlet operating manuals and

sanitation management manuals and rigorously maintains

product quality and ensures legal compliance.

2. Employee awareness activities

The office engages in employee awareness activities to

ensure ethical conduct from the customer’s perspective and

compliance with rules and raises awareness using bulletin

boards, sanitation comic strips, and other means. Such

activities are stepped up at the time of the year when hot,

humid weather increases the risk of food poisoning

outbreaks and during annual events.

3. Information sharing

In the event that an incident occurs, the office strives to

determine the cause and prevent any recurrence. The office

promptly responds to customers and submits an accident

report. It also gathers and shares information on incidents

that occur inside and outside the Group as well as

amendments to laws and regulations, swiftly implement

measures and strives to prevent recurrence.

For companies newly joining the Group, information

sharing is the top priority to enhance the partnerships.

The Food Safety and Security Promotion Department gathers information on

incidents that occur inside and outside the Group and information on law

revisions and takes the initiative in periodically sharing information among Group

companies. In particular, information on the causes of the incidents and

countermeasures are shared in order to prevent recurrence at other outlets.

Measures at operating companies and outlets

1. Handling of cooking ingredients and prepared dishes, accident

countermeasures

We manage cooking ingredients using date labels to thoroughly prevent the use

of ingredients after their use-by dates. We do not top up table seasonings and

we manage expiration dates using predetermined time periods to prevent quality

defects in seasoning.

2. Food poisoning and contamination countermeasures

Employee sanitation management measures include requiring thorough hand

washing, the provision of health checks, and performance of intestinal tests and

individual sanitation inspections of all workers.

Outlet facility sanitation management measures include requiring thorough

cleaning, sanitation inspections conducted by outside organizations, and

announcements to promote periodic replacement of utensils and tableware to

ensure replacement of damaged items.

3. Information provision and management

We verify statements on menus at outlets and departments at three stages—

recipe preparation, request for production of printed materials, and the start of

menu item provision—ensuring legal compliance and statements that are valid

and not misleading.

We comply with the Rice Traceability Act with respect to rice dishes and the

Beef Traceability Act with respect to domestically produced beef handled at

outlets that supply specific cuisine, recording and retaining information and

providing information to customers.

To prevent health hazards to customers with food allergies, we provide

information concerning allergens in menu items.

We conduct computerized management of information on procured cooking

ingredients, such as temperature range, country of origin or final processing site,

and allergen information for each raw material.

We obtain product planning documents for processed products and check for

allergens.

Measure to the Corporate Governance CodeExamples of Initiatives

Basic Policy on Corporate Governance

Corporate Governance

Date label

Activities of the Food

Safety and Security

Promotion Office

Sanitation comic strip

Message - Food Safety and SecurityVarious problems have occurred in the food industry, such as incidents due to causes including radiation, residual agricultural

chemicals, avian flu, BSE, food poisoning, and food allergies.

Incidents of menu mislabeling, intentional poisoning of food products, and use of food products after use-by dates by

manufacturers that supply large restaurant chains have occurred, and customer interest in food safety and security continues

to rise.

The entire create restaurants group will continue making a concerted effort to maintain product quality and earn the trust

of customers, in order to provide safe products and enable customers to enjoy food with confidence and peace of mind.

Food Safety and Security Promotion Office

Measures for Operational Risks

Food safety and security measures

The create restaurants group recognizes that providing safe menus that enable customers to enjoy great food and pleasurable

dining experiences with confidence and peace of mind is a matter of the highest importance to a restaurant company. Accordingly,

the Group makes every effort to instill and raise awareness of food safety and security in all officers and employees.

The Group, mainly through the Food Safety and Security Promotion Office, repeatedly communicates with employees on the

ethics of ensuring food safety and security from the customer’s perspective, and implements measures to ensure recognition that

earning the trust of customers is at the very heart of the Group’s business philosophy.

We review manuals on the handling of prepared dishes and ingredients as needed, provide rigorous employee education, and

strive to strengthen outlet operation in accordance with the manuals.

Furthermore, we are reviewing mechanisms for information sharing between outlets and the head office to speed up reporting

and communication systems within the Company and among Group companies while also working to strengthen communication

and teamwork within outlets.

Preparation of rules

Awareness activities

Information gathering and

sharing


The following is an analysis of the Company’s financial position and business performance for the consolidated fiscal year

ended February 28, 2019.

Forward-looking statements contained herein represent the judgment of the create restaurants group as of the date of

issuance of this annual report.

Analysis of Business Performance in the Consolidated Fiscal Year Ended February 28, 2019During the current fiscal year, the Japanese economy continued

to recover moderately against the backdrop of the effects

of various policies and improvements in corporate earnings,

employment environment and income environment. However,

the outlook remained uncertain due to concerns over the

continued uncertainty in the political and economic situation and

geopolitical risks overseas, including intensifying trade friction

between the United States and China.

In the restaurant industry, although consumer sentiment is

improving moderately, the business environment remains severe

due to the effects of natural disasters such as the Northern Osaka

Prefecture Earthquake and unseasonable weather, mainly in

western Japan, in addition to the persistently high price of raw

materials due to the rise in logistics costs and the rise in labor

costs due to the prolonged labor shortage.

In this environment, our Group was entrusted with the

collective management of "HIBIYA FOOD HALL" in March, which

is located on the first basement floor of Tokyo Midtown Hibiya,

and opened eight outlets with our three Group companies. In

November, our Group opened the “Morton's The Steakhouse”, a

long-established steak format originating in Chicago, the United

States, as the first outlet in Japan, in Marunouchi, Tokyo. In

addition, our Group systematically opened specialty restaurants

and new brands in commercial facilities, downtown districts,

station fronts, and suburban roadside locations, opening 60 new

outlets and closing 29 outlets. As a result of M&A, 17 outlets

of Create Bayside Inc. were newly consolidated from the first

quarter. In addition, 10 outlets of YUZURU Inc. and 2 outlets

of Create Restaurants NY Inc. were newly consolidated from

the fourth quarter. In addition, as a result of aggressive brand

changes and renovations, the number of consolidated outlets

including subcontracted outlets at the end of the current fiscal

year was 925.

As a result of the above, revenue for the current fiscal year

was 119,281 million yen (up 2.4% year on year), operating profit

was 3,975 million yen (down 34.9% year on year), profit before

taxes was 3,688 million yen (down 37.4% year on year), profit for

the year was 2,072 million yen (down 45.7% year on year), and

profit attributable to owners of the parent was 1,321 million yen

(down 51.8% year on year). Adjusted EBITDA decreased 12.1% to

10,814 million. (Note 1)

Reportable segments are omitted because there are no

reportable segments other than the restaurant business.

The status of each categories in the restaurant business is as

follows.

Net sales: 45,633 million yen

Number of outlets: 444

This category consists of the outlets operated by create

restaurants inc., Create Dining inc., and Create Bayside Inc., and

operates restaurants and food courts under a variety brands

mainly in commercial facilities.

CR Category


Number of restaurants: 239

This category consists of outlets operated by SFP Holdings

Co., Ltd., and operates izakaya restaurants, such as ISOMARU SUISAN, Toriyoshi, and Toriyoshi Shoten brands, mainly in urban

downtown districts.

SFP Category



This category consists of outlets operated by our domestic

subsidiaries: LE MONDE DES GOURMET INC., eatwalk Co., Ltd.,

YUNARI Co., Ltd., Gourmet Brands Company inc., KR HOLDINGS

CORPORATION, Route 9g Inc., and YUZURU Inc. They operate

specialty restaurants, taking advantage of their distinctive

characteristics, mainly at suburban roadside locations and urban

commercial facilities.

Specialty Brands Category



This category consists of overseas outlets, including outlets

operated by create restaurants asia Pte. Ltd. in Singapore, create

restaurants hong kong Ltd. in Hong Kong, Create Restaurants

Taiwan Co., Ltd. in Taiwan, and Create Restaurants NY Inc. in the

United States.

Overseas Category

Outlook for the Year Ending February 29, 2020Regarding the outlook for the next fiscal year, the Japanese

economy is expected to continue its moderate recovery trend

against the backdrop of improvements in corporate earnings and

the employment environment. However, the situation remains

unpredictable due to uncertainties in the political and economic

situation, such as the U.S.-China trade friction and the Brexit,

as well as concerns over the continuation of geopolitical risks

overseas, such as the situation in North Korea.

In the restaurant industry, despite the support from inbound

demand from foreign visitors to Japan, personal consumption is

becoming increasingly concerned about the future, and a sense

of deflation is becoming firmly established. In addition, there

are concerns about the impact of the consumption tax hike

scheduled for October 2019. We can not be optimistic about the

cost environment, as labor costs will continue to rise due to labor

shortages, and investment-related costs are expected to soar due

to the construction boom toward the Tokyo Olympics.

In such environment, our Group will continue to aggressively

open outlets in highly profitable locations and develop new

business formats. At the same time, our Group will strengthen

the foundations for mutual synergies among Group companies

by making full use of our ability to respond to changes, which is

a strength of our Group Federation Management. Specifically,

our Group will implement business format changes across Group

companies and develop franchises within our Group. In addition,

we will continue to actively consider M&A, both in Japan and

overseas, as a major driver of growth. In particular, we have

established the North American Business Investment Department

for overseas operations, and are actively working to develop

projects in North America.

Based on the above, as for the full-year forecasts for the fiscal

year ending February 2020, we forecast revenue of 130,000

million yen, operating profit of 6,700 million yen, profit before

taxes of 6,300 million yen, profit for the year of 4,000 million yen,

and profit attributable to owners of the parent of 3,300 million

yen. Adjusted EBITDA is expected to be 22,700 million yen.

Analysis of Assets, Liabilities, and Net AssetsAssets at the end of the current fiscal year amounted 72,459

million yen (up 1.5% year on year). This was mainly due to

increases of 1,082 million yen in other current assets, 582 million

yen in cash and cash equivalents, and 331 million yen in goodwill.

Liabilities at the end of the current fiscal year amounted to

48,462 million yen (up 3.2% year on year).This was mainly due

to increases of 1,476 million yen in other current liabilities and

666 million yen in bonds and borrowings, despite 911 million yen

decrease in income taxes payable.

Assets at the end of the current fiscal year amounted to

23,996 million yen (down 1.8% year on year).

Analysis of Cash FlowsCash and cash equivalents (hereinafter referred to as "cash") for

the current fiscal year resulted in an increase in cash flow from

operating activities of 8,364 million yen (down 29.8% year on

year), a decrease in cash flow from investing activities of 4,886

million yen (down 13.7% year on year), a decrease in cash flow

from financing activities of 2,900 million yen (down 16.4% year

on year), and an increase in cash balance of 13,248 million yen (up

4.6% year on year), including translation differences.

Cash flows from operating activities

Net cash provided by operating activities was 8,364 million yen.

This was mainly due to recording of income taxes paid of 3,785

million yen and depreciation and amortization was 4,196 million

yen, despite the payments for income before income taxes of

3,688 million yen.

Cash flows from investing activities

Net cash used in investing activities was 4,886 million yen. This

was mainly due to purchase of property, plant and equipment of

3,658 million yen.

Cash flows from financing activities

Net cash used in financing activities was 2,900 million yen. This

was mainly due to proceeds from long-term loans payable of 7,931

million yen and repayment of long-term loans payable of 5,235

million yen.

Dividend Policy and Dividend PaymentsThe Company considers returning profit to shareholders to be

an important management issue. Our basic policy is to pay

stable dividends, taking into account factors such as business

performance and future business development. The Group will

use internal reserves as a source of funds for purposes such as

investment for new restaurant openings and capital investment

to reinforce personnel development and internal control systems,

with the ultimate objective of increasing corporate value.

The Company paid an interim dividend of 6.00 yen per share

and a year-end dividend of 6.00 yen per share, and thus the

total cash dividends for the fiscal year ended February 28, 2019

amounted to 12.00 yen per share. The Company plans to pay an

interim dividend of 6.00 yen per share and a year-end dividend

of 6.00 yen per share, and thus the total cash dividends for the

fiscal year ending February 29, 2020 will amount to 12.00 yen per

share.

Management’s Discussion and Analysis

* Effective from the fiscal year under review (from March 1, 2018 to February 28, 2019), the create restaurants group adopted the IFRS instead of the Japanese GAAP, which the Group had been applying. Accordingly, the figures for the previous fiscal year are restated in accordance with the IFRS for comparative analysis.

Notes: 1. Adjusted EBITDA is used as a useful indicator of our financial results. The formula for calculation of adjusted EBITDA is as follows. Adjusted EBITDA=Operating profit + Other operating expenses - Other operating profit

excluding sponsorship revenues + Depreciation and amortization + Nonrecurring expens-es items (advisory expenses related to share acquisitions, etc.)

*1 The figures stated in forecast of consolidated business results for the fiscal year ending February 2020 are the same as those stated in “Notice of Revisions to Business Forecasts” announced on July 12, 2019.

*2 Adjusted EBITDA reflects the impact of the adoption of IFRS 16.


Millions of YenThousands ofU.S. Dollars

Assets 2018(Ref.) 2019 2019

Current assets

Cash and cash equivalents ................................................................................................. ¥ 12,665 ¥ 13,248 $ 118,961

Trade and other receivables .............................................................................................. 2,923 3,107 27,902

Other financial assets......................................................................................................... 0 – –

Inventories .......................................................................................................................... 511 536 4,818

Other current assets ........................................................................................................... 1,074 2,157 19,370

Total current assets ............................................................................................................ 17,175 19,050 171,053

Non-current assets

Property, plant and equipment ......................................................................................... 28,974 27,350 245,582

Goodwill ............................................................................................................................. 11,522 11,853 106,435

Intangible assets................................................................................................................. 1,712 1,686 15,142

Other financial assets......................................................................................................... 10,474 10,679 95,889

Deferred tax assets............................................................................................................. 1,549 1,837 16,503

Other non-current assets ................................................................................................... 0 1 12

Total non-current assets .................................................................................................... 54,234 53,409 479,566

Total assets .............................................................................................................................. ¥ 71,409 ¥ 72,459 $ 650,619


Liabilities and capital 2018(Ref.) 2019 2019

Liabilities

Current liabilities

Trade and other payables .................................................................................................. ¥ 4,252 ¥ 4,419 $ 39,682

Bonds and borrowings....................................................................................................... 8,628 7,441 66,818

Other financial liabilities ................................................................................................... 448 430 3,861

Income taxes payable ........................................................................................................ 1,864 953 8,558

Provision ............................................................................................................................. 632 769 6,910

Other current liabilities ..................................................................................................... 5,579 7,055 63,352

Total current liabilities ....................................................................................................... 21,405 21,069 189,184

Non-current liabilities

Bonds and borrowings....................................................................................................... 19,755 21,609 194,029

Other financial liabilities ................................................................................................... 1,615 1,437 12,910

Obligations for retirement plan........................................................................................ 620 727 6,536

Provision ............................................................................................................................. 2,776 2,897 26,018

Deferred tax liabilities ....................................................................................................... 275 300 2,700

Other non-current liabilities.............................................................................................. 521 419 3,769

Total non-current liabilities ............................................................................................... 25,565 27,393 245,966

Total liabilities ......................................................................................................................... 46,971 48,462 435,150

Capital

Capital stock ....................................................................................................................... 1,012 1,012 9,088

Capital surplus .................................................................................................................... 3,792 3,071 27,580

Retained earnings .............................................................................................................. 13,275 13,551 121,675

Treasury stock ..................................................................................................................... (20) (1,253) (11,254)

Other components of equity ............................................................................................. (23) (20) (184)

Equity attributable to owners of parent .......................................................................... 18,036 16,361 146,906

Non-controlling interests................................................................................................... 6,402 7,635 68,562

Total assets .............................................................................................................................. 24,438 23,996 215,469

Total liabilities and capital ...................................................................................................... ¥ 71,409 ¥ 72,459 $ 650,619

Consolidated Statements of Financial Positioncreate restaurants holdings inc. and Consolidated Subsidiaries

As at February 28, 2018 and February 28, 2019

Consolidated Financial StatementsEffective from the fiscal year ended February 28, 2019, the Group adopted the International Financial Reporting Standards (IFRS).

Accordingly, the results for the fiscal year ended February 28, 2018 are presented in accordance with the IFRS.


Company Overview

Company name

create restaurants holdings inc.

Head office

5-10-18 Higashi-gotanda, Shinagawa-ku, Tokyo 141-0022, Japan

Establishment

May 1999

Capital stock

1,012 million yen

Number of employees

3,838 (on a consolidated basis)

Business

Planning, development, operation, and overall business manage-

ment of various food service businesses, including restaurants,

izakaya, and food courts

Board Members

Chairman Hitoshi Gotoh

President and CEO Haruhiko Okamoto

Executive Managing Director Jun Kawai

Director Takakazu Tanaka

Director Akira Shimamura

Director

(Audit & Supervisory Committee Members) Hirofumi Morimoto

Outside director

(Audit & Supervisory Committee Members) Hiroshi Nemoto

Outside director

(Audit & Supervisory Committee Members) Takeshi Ohki


2018(Ref.) 2019 2019

Cash flows from operating activities .................................................................................... ¥ 11,912 ¥ 8,364 $ 75,101

Cash flows from investing activities ...................................................................................... (5,665) (4,886) (43,876)

Cash flows from financing activities ..................................................................................... (3,470) (2,900) (26,039)

Net increase (decrease) in cash and cash equivalents ........................................................... 2,752 582 5,233

Balance of cash and cash equivalents at beginning of period ............................................. 9,912 12,665 113,727

Balance of cash and cash equivalents at end of period ........................................................ ¥ 12,665 ¥ 13,248 $ 118,961

Consolidated Statements of Cash Flowscreate restaurants holdings inc. and Consolidated Subsidiaries

For the years ended February 28, 2018 and February 28, 2019


2018(Ref.) 2019 2019

Revenue .................................................................................................................................. ¥ 116,522 ¥ 119,281 $ 1,071,037

Cost of sales ........................................................................................................................... (33,524) (34,314) (308,115)

Gross profit ............................................................................................................................. 82,997 84,966 762,921

Selling, general and administrative expenses ..................................................................... (75,638) (79,116) (710,395)

Other operating revenue ...................................................................................................... 1,761 1,028 9,231

Other operating expenses ..................................................................................................... (3,009) (2,902) (26,059)

Operating profit ..................................................................................................................... 6,110 3,975 35,699

Financial income ..................................................................................................................... 86 10 95

Financing cost ......................................................................................................................... (307) (297) (2,675)

Profit before taxes .................................................................................................................. 5,889 3,688 33,119

Corporate income tax expenses ........................................................................................... (2,070) (1,615) (14,505)

Profit for the year .................................................................................................................. 3,819 2,072 18,613

Profit attributable to

Owners of parent .............................................................................................................. 2,743 1,321 11,863

Non-controlling interests .................................................................................................. 1,075 751 6,749

Profit for the year .............................................................................................................. 3,819 2,072 18,613

Yen U.S. Dollars

Earnings per share attributable to owners of parent

Basic earnings per share ................................................................................................... ¥ 29.07 ¥ 14.05 $ 126.16

Diluted earnings per share ............................................................................................... 29.00 13.78 123.73

Consolidated Statements of Incomecreate restaurants holdings inc. and Consolidated Subsidiaries

For the years ended February 28, 2018 and February 28, 2019

Consolidated Financial Statements Corporate Data (As of February 28, 2019)

Stock Information

Total number of shares authorized (share) 190,800,000

Total number of shares issued (share) 94,722,642

Number of shareholders 119,293

*The percentage of shares held is calculated by excluding treasury stock.

Major Shareholders (10 largest shareholders)

ShareholderNumber ofshares held

Percentage of shares held

Goto International Commercial Research Institute 43,763,000 46.36

Yurissa Co., Ltd. 2,682,000 2.84

Haruhiko Okamoto 1,787,700 1.89

Japan Trustee Services Bank, Ltd. (Trust Account) 1,594,600 1.69

Jun Kawai 1,215,000 1.29

Japan Trustee Services Bank, Ltd. (Trust Account 5) 1,037,700 1.10

The Master Trust Bank of Japan, Ltd. (Trust Account) 1,003,900 1.06

Risako Okamoto 846,000 0.90

Yuriko Okamoto 846,000 0.90

Japan Trustee Services Bank, Ltd. (Trust Account 1) 704,600 0.75

Breakdown of Shareholders

Individuals and other(118,457 shareholders) 39,885,564 shares 42.11%

Financial institutions (21 shareholders) 6,253,400 shares 6.60%

Foreign corporations etc.(262 shareholders) 1,271,088 shares 1.34%

Other corporations (525 shareholders) 46,806,006 shares 49.41%

Brokerages (27 shareholders) 173,309 shares 0.18%

Treasury stock(1 shareholder) 333,275 shares 0.35%

Stock Price Range

32018

4 5 6 7 8 9 10 11 12 12019

2

1,800 30,000,000

1,200 20,000,000

(Yen) (Volume)

600 10,000,000

0 0

Total number of shares issued

(share) 94,722,642

Effective from the fiscal year ended February 28, 2019, the Group adopted the International Financial Reporting Standards (IFRS).

Accordingly, the results for the fiscal year ended February 28, 2018 are presented in accordance with the IFRS.


Stock Code : 3387

Year Ended February 28, 2019

ANNUAL REPORT 2019

5-10-18 Higashigotanda, Shinagawa-ku, Tokyo 141-0022, Japan

Tel. +81-3-5488-8001

https://www.createrestaurants.com

010_0170901371909.indd 1 2019/09/20 19:24:24

Documents

ANNUAL REPORT 2019 Dessert Okoku cafes. create restaurants inc. Shabu SAI Dessert Okoku Station buildings and commercial facilities Create Dining operates restaurants and cafes mainly