Horii Food Service Co., Ltd. Releases Q&A on Inbound Business and Shareholder Benefit Program

Horii Food Service Co., Ltd. (Headquarters: Mito City, Ibaraki Prefecture; Representative Director and President: Akihisa Fujita; hereinafter "the Company") has released a Q&A regarding its future store opening strategy, centered on the "Emperor Steak" brand for inbound tourists, and its shareholder benefit program. Against the backdrop of expanding demand from international visitors to Japan, this business format has been performing well, and the Company plans to open three new stores in the fiscal year ending November 2026.

This Q&A primarily addresses questions received from investors.

**About the Inbound Business**

**Q: Emperor Steak seems to be performing well. Could you please share your store opening plans for inbound-focused formats?**

A: We plan to open three new stores in the fiscal year ending November 2026. Currently, a store opening in Kyoto has been decided and is scheduled to open around early May.

**Q: Also, how many locations are there that can maintain the same level of customer attraction and high average spending as the Shinjuku store?**

A: In Tokyo alone, there are many areas with a high number of international visitors, such as Shibuya, Ginza, Asakusa, and Roppongi. Domestically, we believe there is significant potential in areas like Osaka, Kyoto, Fukuoka, and Hyogo.

**Q: We understand that your inbound-focused business is performing well, but it tends to be susceptible to exchange rate fluctuations and geopolitical risks. Regarding this,**

**① To what extent do you plan to accelerate the pace of opening these high-priced format stores in the future?**

A: The number of international visitors is projected to continue increasing, and we recognize that the supply side is insufficient. Therefore, we believe there is still significant room for further store openings.

**② In the unlikely event of a sharp decline in inbound demand, do you have any risk hedging measures in mind, such as converting these stores to cater to domestic customers?**

A: A situation on the scale of the COVID-19 pandemic would require a separate judgment, but based on the current performance of our stores, we believe a 20% reduction would not have a significant impact.

**Q: Is there any impact from Japan-China relations?**

A: We have many visitors from Europe and the US, so there is no impact at present. Our current customer base is about 70% Western and 30% Southeast Asian. We would like to increase the latter in the future, but they are not currently choosing us as much.

**Q: Are there any advantages or disadvantages due to the current exchange rate?**

A: Currently, our operations are primarily domestic, and our ingredients are mainly domestically sourced. While there are increases in material costs, there are no significant advantages or disadvantages overall.

**Q: What is the reason for the strong performance of the Emperor Steak business?**

A: We haven't done anything particularly special; our decisions are based on thorough marketing. Within that, for inbound tourists, we are cultivating a brand recognized through "Kobe beef" and "experience."

**Q: The Emperor Steak Kyoto store will be on the 3rd floor. Do you expect it to be successful?**

A: Based on the performance of our first store, we recently recorded a reservation rate of 70%. For the Kyoto store, we believe we have a strong chance of success by strengthening reservation channels, establishing an experiential operation, and leveraging the value of the view from the 3rd floor and its location on a tourist route to make it a "destination."

**About Shareholder Benefits**

**Questions regarding Japanet Gift Cards**

**Q: Where can Japanet Gift Cards be used?**

A: They can only be used on Japanet's official online store (WEB exclusive). They cannot be used via phone orders.

**Q: Are there any products that cannot be purchased with Japanet Gift Cards?**

A: Some special sale items and set products are excluded. Please check Japanet's website for details.

**Q: Do Japanet Gift Cards have an expiration date?**

A: Yes, they are valid for two years from the date of issue. They cannot be used after the expiration date.

**Q: Can Japanet Gift Cards be used multiple times?**

A: Yes, they can be used up to the remaining balance.

**Q: What happens if Horii Food's business ceases operations?**

A: In the unlikely event that the Company becomes unable to pay due to business cessation or changes, the gift cards may become unusable.

**Q: The shareholder benefit validity period is two years. Does this mean I can use a total of 200,000 yen if combined with the second year's benefits?**

A: Yes, you can use a total of 200,000 yen when combining two years' worth of benefits.

**Q: Where can Horii Food meal tickets be used?**

A: They can be used at our group's directly managed stores (including some FC stores). We plan to make the list of eligible stores available on our website and in guidebooks.

**Questions regarding Horii Food Meal Tickets**

**Q: How many Horii Food meal tickets can be used at once?**

A: Multiple tickets can be used simultaneously for one transaction. No change will be given.

**Q: Do they have an expiration date?**

A: Yes, they are valid for one year from the date of issue. They cannot be used after the expiration date.

**Q: Please tell me about continuous shareholder benefits.**

A: This is a benefit where bonus points are awarded to shareholders who have continuously held shares for one year or more. For the first year, eligible shareholders are those whose identical shareholder number is listed or recorded for two consecutive times or more in the Company's shareholder registry at the end of May 2026 and the end of November 2026, for each shareholding category. For subsequent years, eligible shareholders are those whose identical shareholder number is listed or recorded for three consecutive times or more in the Company's shareholder registry at the end of May and the end of November, for each shareholding category or higher.

**Q: How did the partnership with Japanet come about?**

A: Our parent company, CCH, possesses a wide network of corporate connections through its support for overseas sports clubs. The partnership for this shareholder benefit program originated when we became sponsors of the Belgian football team STVV (Sint-Truiden) together with Japanet.

**Q: When will the shareholder benefits be dispatched?**

A: This year, they are scheduled to be dispatched around late April. For the next fiscal year and beyond, we are considering digitizing the meal tickets and plan to work towards earlier dispatch.

**Q: Can they be reissued if lost?**

A: We do not reissue them. Please handle them with care.

**Q: What is the financial impact of the shareholder benefits?**

A: The cost is minor, and we plan to process a provision assuming an utilization rate of around 20%. For gift cards, we will be billed when they are used.

**Q: What is the future policy for shareholder benefits?**

A: We aim to build long-term trust with our shareholders and will continuously improve the system.

**About Store Development**

**Q: You mentioned cost reduction through DX. How are you improving profit margins despite wage increase pressures?**

A: By introducing mobile ordering, we have reduced the burden on hall staff, allowing us to strengthen our kitchen operations. This has led to improved productivity, and we are working to enhance both employee satisfaction and productivity.

**Q: I'm concerned that the expansion of virtual restaurants might be overly burdening the stores. How are on-site voices reflected in management?**

A: When introducing virtual restaurants, we prioritize operations that minimize burden. We strive to make products simple yet consistent regardless of who prepares them. While these are products approved by our partners, we also incorporate feedback from the field into product development.

**Q: With the izakaya market shrinking, how are you thinking about converting existing business formats?**

A: The reason we currently operate 14 different formats is that we are constantly challenging ourselves with new formats that can become pillars of our business. When a store is not performing well, we have a system in place to revive it through format conversion.

The Company will continue to accurately grasp domestic and international demand trends and strive for sustainable growth and enhancement of corporate value.

**■ Horii Food Service Co., Ltd. Company Profile**

Company Name (Trade Name): Horii Food Service Co., Ltd. English Company Name: Horiifoodservice Co., Ltd. Representative: Akihisa Fujita, Representative Director and President Location: Carney Place Mito 4F, 3-10-17 Jonan, Mito City, Ibaraki 310-0803 Business Activities: Chain development and operation of restaurants URL: https://www.horiifood.co.jp/