Our pre-M&A assumption was that there was a risk of monthly sales gradually decreasing immediately after the M&A due to partial closure of stores at Walmart, which is why we acquired NEN’s equity with a buffer at an EV/EBITDA of 3.6x.

However, we rapidly advanced the PMI, and sales after the SWAP increased more than anticipated (1). Additionally, the significant success of this SWAP strategy garnered attention, leading to numerous inquiries for new store openings (2).

As a result, we swiftly offset the sales impact from the partial closure of stores at Walmart, and our monthly consolidated sales have already turned positive year-over-year. Sales continue on a growth trajectory, showing an exceptionally strong start.

(1) Reasons for sales growth: SWAP effect at existing stores

　－The sales increase from SWAP is exceeding expectations (an average same store growth rate of +110% across 515 stores).

　－We start introducing popular Japanese IP prizes like Sanrio and Godzilla from late June.

　－We plan to continuously introduce more Japanese IP prizes in the future.

(2) Reasons for sales growth: Increase in new store openings

　－Leveraging the aforementioned doubling of sales due to SWAP, we are actively pursuing new store openings.

　－As a result, new store openings that were not anticipated before the M&A are now progressing.

　－The number of new monthly store openings now exceeds the monthly store closures at Walmart, resulting in a net increase in our current store count.

　－Even at Walmart, where closures were progressing, we have secured new store openings (please refer to Q. Please tell us about the status of business with Walmart in the North American business.).

Both (1) and (2) are unexpectedly positive factors. We have proactively accounted for unbudgeted costs as upfront investments compared to the initial target, and we will continue these as growth investments intended to significantly boost mid-to-long-term earnings in the future.

We believe that by incorporating M&A into our strategy, we are building a new growth story. This involves directly providing global content, specifically Japanese anime IP, to individual consumers in North America through our platform.