Consolidated forecast for the fiscal year ending March 31, 2024

The effects of numerous events will have to be closely watched because of the considerable uncertainty about the Japanese economy due to the economies of other countries, inflation, the Ukraine conflict, prices of resources and other factors. In Japan, social and economic activity is returning to normal along with pandemic safety measures as the severity of the pandemic declines. Measures to live with COVID-19 are continuing, such as revisions of the legal status of the pandemic and the end of the requirement to wear masks. Progress concerning a return to normal social and economic activities is expected to continue.

In Japan's funeral market, the effects of the pandemic are slowly declining. We forecast a continuation of the growing tendency for people to have small and simple funerals and in the diversification of funeral formats to reflect shifts in lifestyles and preferences. Funeral companies will have to adapt to these shifts in customers' needs.
The SAN HOLDINGS Group will continue to take numerous actions aimed at accomplishing the goals of the current medium-term management plan for the three-year period ending in March 2025. These actions will be accompanied by measures for the safety of customers, business partners, and employees and their families concerning the pandemic.

Our outlook for the fiscal year ending in March 2024 is as follows.

• In the funeral business, we expect to maintain the market shares of existing funeral halls and increase the number of funerals at new locations. We also anticipate no change in average revenue per funeral. Based on this outlook, we forecast an increase in ordinary funeral revenue. The number of funerals for pandemic deaths is expected to be smaller than in the previous fiscal year.
• In the end of life support business, our goal is to increase sales in the customer service businesses of the three funeral companies and in all other categories.
• In accordance with the medium-term management plan, we will hire more people in order to operate new funeral halls and support the larger scale of our operations during the fiscal year ending in March 2024.
  We plan to open eight locations during the fiscal year as in the previous fiscal year. Most will use the Ending House brand. The eight new locations are expected to result in up-front expenses of 227 million yen. There will also be up-front expenditures for recruiting activities in order to add the people we need to create the workforce needed for the continuing increase in the number of funeral halls. These activities are expected to raise personnel and recruiting expenses by 620 million yen.
• As a result, we forecast higher revenue but lower earnings in the fiscal year ending in March 2024. However, we expect that operating revenue and operating profit will be higher than the plan for these earnings in the second year of the medium-term management plan, which was announced in May 2022.

*Cautionary statement with respect to earnings forecasts
Forecasts incorporate risks and uncertainties because the forecast is based on judgements made by using information available to the management of SAN HOLDINGS and its group companies. Actual results may differ materially from the forecasts due to changes in the economy and market conditions of the SAN HOLDINGS and its group companies as well as a number of other factors.