Slides
Page 1
Transformation of 7-Eleven Seven & i Holdings Co., Ltd. August 6, 2025
Page 2
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 2 Disclaimer A registration statement relating to the common shares to be sold in the SEI IPO is expected to be filed with the U.S. Securities and Exchange Commission, but has not been filed or become effective. SEI common shares may not be sold and offers may not be accepted prior to the time the registration statement becomes effective. This presentation does not constitute an offer to sell or the solicitation of any offer to buy, and there shall not be any sale of the common shares in any state or jurisdiction in which such offer, solicitation or sale would be unlawfulprior the registration or qualification under the securities laws of any such state or jurisdiction. This presentation contains “forward-looking statements” as defined under applicable securities laws, which statements involve substantial risks and uncertainties. Words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “intend,” “may,” “plan,” “project,” “predict,” “should” and “will” and similar expressions as they relate to 7&i are intended to identify such forward-looking statements. These forward-looking statements include, but are not limited to, statements regarding (a) the projected financial performance of 7&i, (b) the expected development of 7&i’s business and projects, (c)7&i’s intention to conduct an SEI IPO and the timing thereof, (d) 7&i’s continued efforts to sell its superstore business as York Holdings and the timing thereof, (e) the anticipated benefitsof the SEI IPO, the sale of York Holdings, and the proposed share buybacks, in each case, for 7&i and its shareholders, (f) 7&i’s and SEI’s future operations, including the financial flexibility and decision-making autonomy of SEI after the SEI IPO and the use of SEI IPO proceeds for 7&i to fund share buybacks, and (g) 7&i’s continued efforts in pursuing the announced business transformation initiatives. These forward-looking statements are based on 7&i’s current expectations and beliefs and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in these statements. These factors and uncertainties include but are not limited to: (i) adverse changes in general economic or market conditions, (ii) the inability to manage successfully and complete the IPO of SEI (including the ability to retain and attract key employees post-IPO), the sale of York Holdings, and 7&i’s other previously announced business transformation initiatives, (iii) the risk that the IPO of SEI, the sale of York Holdings, and 7&i’s other announcedbusiness transformation initiatives may not occur in their expected timeframe or at all and (iv) other one-time events and other important factors disclosed previously and from time to time in 7&i’s public filings with the Financial Services Agency in Japan, the Tokyo Stock Exchange or on 7&i’s website (https://www.7andi.com/en/ir/library). Moreover, 7&i operates in a very competitive and rapidly changing environment, and newrisks may emerge from time to time. Because forward-looking statements are inherently subject to risks and uncertainties, some of which cannot be predicted or quantified, the reader should not rely on these forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur and actual results and performance could differ materially from those projected in the forward- looking statements. In addition, statements that “we believe” and similar statements reflect 7&i’s beliefs and opinions on the relevant subject. These statements are based upon information available to 7&i as of the date of this presentation, and while 7&i believes such information forms a reasonable basis for such statements, such information may be limited or incomplete, and 7&i’s statements should not be read to indicate that 7&i has conducted an exhaustive inquiry into, or review of, all potentially available relevant information. The reader should read this presentation with the understanding that 7&i’s actual future results, levels of activity, performance and achievements may be materially different from what 7&i expects. 7&i qualifies all of the foregoing forward-looking statements by these cautionary statements. Moreover, neither 7&i, nor any other person, assume responsibility for the accuracy and completeness of the forward-looking statements. Except as required by applicable law, 7&i undertakes no obligation to publicly update or revise any estimates or forward-looking statements whether as a result of new information, future events or otherwise, or to reflect the occurrence of unanticipated events. This presentation includes non-GAAP financial measures. These non-GAAP financial measures are in addition to, and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. There are a number of limitations related to the use of these non-GAAP financial measures. For example, other companies may calculate similarly-titled non-GAAP financial measures differently. This presentation contains estimates and forecasts concerning 7&i’s industry, including estimates of the total addressable market and serviceable addressable market of 7&i’s current and anticipated future solutions, that are based on industry publications and reports or other publicly available information as well as 7&i’s internal estimates and expectations. This information involves a number of assumptions and limitations, and is subject to significant uncertainty, and the reader is cautioned not to give undue weight to these estimates. Industry surveys and publications generally state that the information contained therein has been obtained from sources believed to be reliable, but there can be no assurance as to the accuracy and completeness of the included information. 7&i has not independently verified this third-party information. . While 7&i is not aware of any misstatements regarding any market, industry or similar data presented herein, such data involves risks and uncertainties andis subject to change based on various factors. Accordingly, 7&i makes no representations as to the accuracy or completeness of that data nor does 7&i undertake to update such data after the date of this presentation.
Page 3
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 3 TODAY’S AGENDA Our Transformation Where We Are 1 2 The Numbers 3
Page 4
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 4 Shareholders/Investors Customers FC Owners Business Partners Society Employees Associates “We will grow by solving social challenges through our retail/distribution business” What Won’t Change – Our Values and Philosophy Trust and sincerity (Masatoshi Ito) Embracing change (Toshifumi Suzuki) Collaborate and prosper together Social Impact Founders’ Mentality Stakeholder Collaboration Social Impact Founders’ Mentality Stakeholder Collaboration Masatoshi Ito Toshifumi Suzuki
Page 5
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 5 History of 7-Eleven’s Innovation and Success 1965 The Drink Revolution 1963 All Night Long 1950s Beyond Texas 1927 World’s First C-Store 1970 The Self-Service Movement 1990s Getting Healthy 2000s New 7-Eleven Day Traditions 2005 New Ownership 2010s Digital Transformation Present A Growing 7-Eleven Family 7-Eleven, Inc. 1975 Started 24-hour operations 1978 Launched rice balls products 2001 Installed in-store ATMs 2007 Launched Seven Premium products 2013 Launched Seven Cafe products 1974 Opened the first SEVEN-ELEVEN store SEVEN-ELEVEN JAPAN Present A Growing 7-Eleven Family 2007 Launched Freshly-fried food at in-store kitchen 2002 Started ticketing service in multifunctional copymachine
Page 6
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 6 Group’s Growth History *1 Revenue does not include area licensees’ revenue *2 As of the end of Feb. of each FY, including licensed stores. 500 700 900 1,100 1,300 1,500 1,700 0 2 4 6 8 10 12 14 16 2005 2016 2017 2018 2019 2020 2021 2022 2023 2024 Revenue From Operations（Left Axis）*1 EBITDA（Right Axis） 0 3.8Tn yen （Billions of yen) （FY） （Trillions of yen） 62,053 65,829 67,927 78,721 83,282 11.9Tn yen c.30,000 5.8Tn yen # of 7-Eleven Stores Globally 2.8x # of Stores *2 70,431 85,932 84,652 EBITDA CAGR (FY05–24) 5.8% Revenue CAGR (FY05–24) 6.1% 72,802 995.5Bn yen 588.2Bn yen 343.6Bn yen Sustaining success requires constant reinvention and innovation
Page 7
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 7 Our Key Challenges • Shift of consumer spending • Channel shift • Cost-push inflation • Franchisee profitability • Consumer perception re: fresh food • Declining fuel demand • Consumer perception re: brand • Intensifying competition • Rigorous investment process • Talent to fuel global growth • Absence of rigorous global planning and management • Lack of clarity and consistency in global decision making • Global talent • HQ not fit for purpose • Global leverage Across SEI/SEJ/ 7IN HD/HQ SEI SEJ 7IN
Page 8
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 8 TODAY’S AGENDA Our Transformation Where We Are 1 2 The Numbers 3
Page 9
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 9 Maximizing the Opportunities We Have Today Key Challenges • Consumer spending • Channel shift • Cost inflation • Franchisee profitability • Consumer perception re: food • Fuel demand • Consumer perception re: brand • Intensifying competition • Global talent • Investment process Across SEI/ SEJ/ 7IN • Global planning and mgmt. • Global decision making • Global talent • HQ not fit for purpose • Global leverage HD/HQ SEI SEJ 7IN • Invest in stores/equipment for distinctive food offering • Store network expansion with optimal store formats • 7NOW expansion • Cost control to invest in growth • Expand proprietary products and Private Brand • Maximize fuel vertical integration opportunities • Enhance customer engagement • Accelerate global talent acquisition /development • Set rigorous investment criteria and mgmt. rules Across SEI/ SEJ/ 7IN • Set clear global management approach and cadence • Upgrade our HD functionHD/HQ SEI SEJ 7IN 1-A 1-B 2-A 2-B 2-C 2-E 2-F 2-G 2-D Our Approach for Growth
Page 10
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 10 Maximizing the Opportunities We Have Today Key Challenges • Consumer spending • Channel shift • Cost inflation • Franchisee profitability • Consumer perception re: food • Fuel demand • Consumer perception re: brand • Intensifying competition • Global talent • Investment process Across SEI/ SEJ/ 7IN • Global planning and mgmt. • Global decision making • Global talent • HQ not fit for purpose • Global leverage HD/HQ SEI SEJ 7IN • Invest in stores/equipment for distinctive food offering • Store network expansion with optimal store formats • 7NOW expansion • Cost control to invest in growth • Expand proprietary products and Private Brand • Maximize fuel vertical integration opportunities • Enhance customer engagement • Accelerate global talent acquisition /development • Set rigorous investment criteria and mgmt. rules Across SEI/ SEJ/ 7IN • Set clear global management approach and cadence • Upgrade our HD functionHD/HQ 1-A 1-B 2-A 2-B 2-C 2-E 2-F 2-G 2-D Our Approach for Growth SEI SEJ 7IN
Page 11
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 11 Getting the Organization and Management Process Right New leadership with enhanced management approach and HD oversight • Disciplined yet autonomous decision making of OpCos • Strengthened senior-level global coordination • Fixed roles and responsibilities with clear definitions esp. for HD • With focus on CVS, lean HD and adding critical global functions New leaders implementing an enhanced management approach Global, concrete, time-bound, clear ownership and accountability. Globally integrated team with clear understanding of duties and responsibilities Upgraded HD function 1-A 1-B
Page 12
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 12 Leadership Team Representative Director & President Chief Executive Officer Stephen Hayes Dacus Representative Director & Executive Chair Junro Ito Representative Director & Vice President, Chief Administrative Officer Shigeki Kimura Director & Managing Executive Officer, Chief Financial Officer Yoshimichi Maruyama Director & Managing Executive Officer, Chief Strategy Officer Tamaki Wakita Seven & i Holdings Chairman Shinji Abe President & CEO Ken Wakabayashi 7-Eleven International LLC (“7IN”) 7-Eleven, Inc. (“SEI”) President Stan Reynolds CEO Joseph M. DePinto Executive Vice President & COO Doug Rosencrans International CVS (Excl. Japan, North America)North America CVS 1-A Seven-Eleven Japan Co., Ltd. (“SEJ”) Domestic CVS Global governance approach to drive our growth transformation Newly appointed senior management President & Representative Director Tomohiro Akutsu Director, Managing Executive Officer Terutaka Kuretani
Page 13
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 13 Create lean and streamlined HD function • Optimize support functions • IT system to focus on CVS Centers of Excellence to leverage global scale and best practice • DX / technology • Merchandise supply chain • Operations Lean and Upgraded Headquarters Existing headquarters supporting multiple businesses (incl. superstore and financial services), not fit for purposeChallenges Upgrade headquarter and holdings function for “Pure CVS Group” (incl. 50% reduction in HD’s OSG&A from c. ¥81Bn by FY2030) 1-B
Page 14
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 14 Maximizing the Opportunities We Have Today Key Challenges • Consumer spending • Channel shift • Cost inflation • Franchisee profitability • Consumer perception re: food • Fuel demand • Consumer perception re: brand • Intensifying competition • Global talent • Investment process Across SEI/ SEJ/ 7IN • Global planning and mgmt. • Global decision making • Global talent • HQ not fit for purpose • Global leverage HD/HQ SEI SEJ 7IN • Invest in stores/equipment for distinctive food offering • Store network expansion with optimal store formats • 7NOW expansion • Cost control to invest in growth • Expand proprietary products and Private Brand • Maximize fuel vertical integration opportunities • Enhance customer engagement • Accelerate global talent acquisition /development • Set rigorous investment criteria and mgmt. rules Across SEI/ SEJ/ 7IN • Set clear global management approach and cadence • Upgrade our HD function SEI SEJ 7IN 1-A 1-B 2-A 2-B 2-C 2-E 2-F 2-G 2-D Our Approach for Growth HD/HQ
Page 15
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 15 Need to draw customers with more differentiation in foodChallenges Rebuild and offer distinctive food offering through aggressive investment in our stores and restaurants Distinctive Fresh Food Offering SEJSEI 7IN 2-A SEI Restaurant offers more tasty, fresh food with SEI’s core CVS operations # of stores with a restaurant Offer wider varieties of tasty, fresh food to customers by investing in stores (remodel and new equipment) as well as by expanding our store formats SEJ Operational KPI • Install 7 Café bakery and 7 Café Tea nationwide • Invest in 5,000 stores to strengthen food offerings by FY30 1,100 Add 1,100 by FY2030 As of FY24 Addition until FY30 As of FY30Closure 2,000+ 1,080
Page 16
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 16 Satisfy changing customer needs with new formats and accelerate openingsChallenges Accelerate store expansion in the US and Japan by becoming more relevant to customers’ needs with improved store formats Store Network Enhancement SEJSEI 7IN 2-B SEI Open new large format stores # of new stores: Increase by c. 1,300 by FY2030 with new format with high APSD stores Accelerate store expansion while our competitors slow down Leverage multiple store layouts/formats # of stores*1 SEJ FY19-24 FY25-30 c.1,000 1.4X+ Net increase by c. 1,000 by FY2030 Merch APSD by store type $5.7k $8.2k +45% New Standard at Maturity (year 4)Existing Portfolio *1 Net increase in standard stores only; excludes small-format stores.
Page 17
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 17 Unleash 7NOW’s full potential Customers definition of convenience continues to evolve, and our franchisees need additional sources of revenue. 7NOW delivers both Challenges SEJSEI 7NOW will redefine convenience with delivery in less than 30 minutes 2-C SEI Expand 7NOW’s geographic and service coverage, such as subscription (e.g., 7NOW Gold Pass) # of 7NOW stores Add 200 stores per year through FY2030, exceeding 50% population coverage in the US Continue to refine the service and rollout the geographic coverage 7NOW sales SEJ FY24 FY30 c.¥120bn 10X+ Increase sales to ¥120bn by FY2030 FY24 FY25 FY30 c.7,000 c. 7,500 c. 8,500
Page 18
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 18 OSG&A Control across Value Chain Inflation driving cost increaseChallenges SEJSEI 7IN 2-D Turn cost control into a competitive advantage and invest where our customers value it 2025 2026 2027 2028 2029 2030 Gross Profit OSG&A 5yr CAGR c.2.6% c.0.6% Control OSG&A increase lower than GP growth SEI Continue SEI’s cost leadership activities to keep OSG&A increase slower than topline and GP growth Rigorously control OSG&A across value chain by launching company-wide transformation program YoY change of OSG&A and gross profit Operational KPI Maintain OSG&A % at current level (<12%) through FY2030 (vs. 100bps increase predicted from As-Is forecast) SEJ
Page 19
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 19 Enhance our Private Brand team and improve our business processes to better serve customers’ needs for savings accompanied with value and quality Accelerated Proprietary Product & Prive Brand Expansion Change the perception of value and quality of our products, especially foodChallenges Expand our private brand and proprietary product offerings delivering high quality at great value for our customers and enhancing trust in our brand SEI 2-E SEI Sales CAGR (FY2024→ 2030) Total Merch Sales PB 2.1% 6.5% GP% (FY2024 Actual) NB PB 33.0% 51.3% +4.4pt +18.3pt
Page 20
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 20 Maximize Fuel Vertical Integration Opportunities2-F Maximize opportunities across the entire fuel value chain Untapped opportunities to capture profit pools within SEI’s fuel supply chainChallenges SEI SEI Organization and Capabilities Build organizations, capabilities, and infrastructure to support fuel strategy Tools and Intelligence Utilize advanced analytics and existing asset base to achieve efficiencies through vertical integration Value Chain Coverage Capture additional supply chain opportunities by gaining access to and investing in logistics infrastructure (e.g. marine, terminals, etc.) Supply Cost Control Establish blending program to achieve fuel supply cost efficiencies Operational KPI ~$400mn EBITDA (byFY2030)
Page 21
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 21 SEJ Customer Engagement Strategy Lack of effective customer communication has impacted brand perceptionChallenges Regain support from customers (especially younger generation) SEJ 2-G Upgrade customer perception through… Customer communication Establish interactive customer communication through various channels Revamp our customer communication by forming a dedicated specialist team Integrated approach to customer experience Develop high valued fresh food offerings (e.g., counter food) Enhance customer experience by introducing store format/models based on regions’ needs SEJ
Page 22
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 22 Operational KPIs toward 2030 Consumer perception 7NOW PB/Proprietary Product Store Network Food Offering OSG&A Fuel Opportunities 2-A 2-B 2-E 2-C 2-F 2-D Add 1,100 restaurants by 2030 Add 1,300 New stores PB sales Growth CAGR at 6.5% Add 200 stores/year 50%+ Population coverage Merch APSD CAGR at 2.4% ~$400mn EBITDA uplift Slower increase than GP growth Enhance capability in 5,000+ stores Net increase of 1,000 stores n/a ¥120bn in Sales APSD CAGR at 2.0% n/a OSG&A% < 12% SEJSEI
Page 23
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 23 Creating a New Model for the Future Using tech to reinvent the customer experience to meet current and future needs, creating an exciting new experience both on and offline, driving traffic to our stores and apps Technology will Enable New revenue stream (e.g., retail media) High-efficient format Leverage analytics New distribution model Automated operations Redefine store formats Productivity evolution Productivity evolution Tailored promotion Smooth shopping experience Achieve better productivity and experience across our entire value chain (Examples below) Our Strengths Automation / Unmanned operationRPAAI / IoT Data analytics / Personalization Next gen mobility / Drone MerchandisingCustomer base Value chain Stores People Customers Store owners/ associates Manufacturing and logistics partners 7NOW partners HQ
Page 24
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 24 TODAY’S AGENDA Our Transformation Where We Are 1 2 The Numbers 3
Page 25
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 25 Roadmap Toward 2030 *1 Pro-Forma with York HD and Seven Bank being equity method affiliates through full year *2 Based on current J-GAAP. [ROIC= {Net income + Interest expense x (1 - Effective tax rate)} / {Owner’s equity + Net Interest-bearing debt (both the averages of the figures at the beginning and the end of each fiscal year)}] EPS Debt / EBITDA Revenue from operations OSG&A EBITDA SEI SEJ 7IN ROIC *2 SEI SEJ 7IN Gross profit from operations SEI SEJ c.86 2.5x 10.0Tn c.2.3Tn c.0.9Tn 573Bn 323Bn 26Bn 4.8% 6.0% 21.4% 6.7% 2.7Tn 1,757Bn 843Bn FY24A *1 c. 210 ~0.6x c.11.3Tn c.2.6Tn c.1.3Tn 0.9Tn+ 0.4Tn+ 50Bn+ c.12.6% c.10.5% c.22.0% c.11.5% c.3.4Tn c.2.1Tn c.1.1Tn FY30E c.17.0% c.-1.9x c.2.0% c.Flat % of Sales c.7.0% c.7.5% c.4.0% c.14.0% +c.7.8%pt +c.4.5%pt +c.0.7%pt +c.5.0%pt c.3.9% c.2.5% c.4.0% CAGR CAGR CAGR CAGR CAGR CAGR
Page 26
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 26 (Ref.) Pro-Forma IFRS Conversion Impact *1,2 *1 IFRS numbers are preliminary estimation, mainly focusing on goodwill amortization and lease accounting *2 All future numbers are rounded *3 YHD and Seven Bank numbers are excluded from 2024 Actual numbers 2024A *3 2030 ¥0.9tn ¥1.3tn ¥1.3tn ¥1.7tn +¥0.4tn (+30%) 1.3X J-GAAP IFRS 2024A *3 2030 ¥210+ ¥86.2 ¥112.8 ¥250+ +¥40 (+15%) 2.3X J-GAAP IFRS Consolidated EBITDA Consolidated EPS
Page 27
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 27 Enhanced Go-Forward Capital Allocation Framework *1 Includes dividends to SEI’s minority shareholders Included operating cash flow as well as proceeds from sale of Superstore Business Group and SEI IPO Total source of funds (FY25E–FY30E) JPY c.~7.5Tn Approx. 40% Approx. 40% Approx. 20% Debt Paydown etc. *1 JPY c.~1.4Tn 3 Growth Investments JPY c.~3.2Tn 1 Capital Expenditures and Bolt-On M&A Capital Return JPY c.~2.8Tn 2 Share Repurchases (2.0Tn) and Dividends % of Capital to be Deployed 7&i Holdings will continue to take a disciplined approach to capital allocation towards the goal of maximizing value for our shareholders
Page 28
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 28 Commitment to an Improved Long-Term Growth Algorithm +LSD% Revenue Growth +MSD% Adjusted EBITDA Growth +High-Teens% Adjusted EPS Growth Total Shareholder Return above EPS Growth Operating margin expansion JPY 600 billion this fiscal year and JPY 2.0 trillion in total through FY30 Steadily increasing dividends 1. Inclusive of the sale of Superstore Business Group, deconsolidation of Seven Bank and IPO of SEI Long-term Growth Algorithm Driving Significant Value Creation *1
Page 29
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 29 Key Takeaways Reinforce our core values and founder’s mentality Manage the business differently Maximize our clear and near-term opportunities Commit to improved capital allocation and growth algorithm
Page 30
Copyright(C) Seven & i Holdings Co., Ltd. All Rights Reserved. 30 The information disclosed by the Company may contain forward-looking statements. These statements are based on management’s judgment in accordance with materials available to the Company at the time of disclosure, with future projections based on certain assumptions. The forward-looking statements therefore incorporate various risks, estimates, and uncertainties, and as such, actual results and performance may differ from the future outlook included in disclosed information due to various factors, such as changes in business operations and the financial situation going forward.