Invester Relations

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I’d like to take this opportunity to thank all shareholders and other investors for their continued interest in and support for Circle K Sunkus.

Today, July 1, we announced our earnings for the first quarter of the fiscal year ending February 28, 2011.

During the first quarter, we worked to further enhance our hallmark Cherie Dolce dessert selection. We launched a series of chilled beverages as a new Cherie Dolce dessert line in April, following the launch in November 2009 of the Cherie Dolce α series of room-temperature baked and semi-fresh (hannamagashi) confectionery. Both of these dessert series sold well during the first quarter. Nevertheless, existing store sales decreased 6% year on year on a non-consolidated basis, despite steady signs of a recovery in sales. Circle K Sunkus is projecting a drop in earnings for the fiscal year ending February 28, 2011. However, Circle K Sunkus delivered first-quarter earnings that surpassed its forecasts, partly because first-quarter sales were better than expected.Please view our earnings report for further details on operating results for the first quarter of the fiscal year ending February 28, 2011.

From the second quarter, the Company will continue to implement sales enhancement measures to drive a full-fledged turnaround in sales. In order to develop retailing spaces that fit customers' increasingly diverse lifestyle settings, Circle K Sunkus began sales of long-life delicatessen items storable for extended periods of time in June. Efforts will also be focused on discount services tied to specific time periods. From July, Circle K Sunkus will begin accepting payment via Suica cards offered by East Japan Railway Company (JR East) as well as QUO Cards, for which there were many requests based on a shareholder questionnaire. We believe that the acceptance of new payment methods will further enhance convenience for customers.

In other areas, in May we opened a store that combines a convenience-store with a drug store/dispensing pharmacy through our business alliance with cocokara fine HOLDINGS Inc. Looking ahead, in addition to proceeding with the development of new store formats, we will revitalize retailing spaces for general merchandise by making use of cocokara fine HOLDINGS’ expertise. Our goal is for these efforts to help lift overall sales at existing stores.

In the fiscal year ending February 28, 2011, Circle K Sunkus celebrates the 30th anniversary of opening its first Circle K and Sunkus stores. I am strongly determined to make our 30th anniversary a new starting point for ensuring that Circle K Sunkus remains a convenience store chain that is chosen by customers in the years ahead. From July, various 30th anniversary sales, campaigns and other events are planned. By having Head Office and franchisees work as one to develop retailing spaces and products that customers enjoy and see as fun through various events of this kind, we will continue working to improve our business results in the future. The continued support and understanding of all our shareholders and other investors will be as vital as ever.