Fiscal Year Ending March 31, 2020
Second Quarter
Business Results Presentation[U.S. Accounting Standards]
November 2019
Wacoal Holdings Corp.
US-based Intimates Online, which was acquired as a subsidiary, has been consolidated since thesecond quarter, and the results are included and disclosed in Wacoal International Corp. (The U.S.)in the overseas Wacoal business segment.
(In this presentation, Intimates Online is sometimes referred to as IO)

1

Fiscal Year Ending March 31, 2020
First Half Business Results (April-September)and Full Business Year Outlook
Akira Miyagi
Wacoal Holdings Corp.
Managing Director, General Manager of Corporate Planning2Overview of Results for FY2020 2Q (July-September) Executive Summary Net sales increased by ¥1.7 billion with increased sales of Wacoal, but failed to reach the estimate
 Operating income landed as planned.
 Recorded valuation gain of ¥1.98 billion in valuation gain and loss on marketable securities andinvestments from July-September Incorporated sales of ¥0.35 billion (operating loss ¥0.2 billion) from acquired IO(*consolidation period August/September)
Net sales¥54.14 billion (up ¥1.7 billion (3.2%) year on year)(reached 95% of the plan total and fell short of it by ¥2.86 billion)

Wacoal sales increased from last-minute demand before the consumption tax increase.

Both existing US businesses and Thai material productions company struggled. China failed to achieve estimate due to sluggish
Peach John business

Operating income¥5.85billion (up ¥1.25 billion (27.3%) year on year)(reached 99.2% of the plan total and fell short of it by ¥0.05 billion)

Income increased due to increased sales.
Recorded one-time expense related to acquisition of IO, in addition to incorporating operating loss.

Income before income taxes and equity
in net income of affiliated companies¥7.81 billion (up ¥0.42 billion (5.6%) year on year)(reached 139.4% of the plan total and exceeded it by ¥2.21 billion)*Effects caused valuation gain or loss on marketable securities and investments not reflected in estimate

Recorded valuation loss of ¥2.94 billion in 1Q, and valuation gain of ¥1.98 billion in 2Q (first half total: valuation loss of ¥0.96 billion)(previous 1Q: valuation gain of ¥3.16 billion previous 2Q: valuation gain of ¥2.5 billion first half total: valuation gain of ¥5.66 billion)

3

Net Sales and Operating Income per Quarter
by Business Segment for FY2020 (YoY comparison) Net sales improved from trend in the first quarter

Net sales

Operatingincome1Q

2Q

First Half

Wacoal Business (Domestic)- 0.3%

+6.0%

+3.0%

Wacoal Business (Overseas)- 7.7%- 3.1%- 5.4%

Peach John Business- 4.4%+4.2%- 0.1%

Other Businesses- 16.4%+3.7%- 6.4%

total- 4.2%+3.2%- 0.4%

1Q

2Q

First Half

Wacoal Business (Domestic)- 5.7%+48.4%+26.7%

Wacoal Business (Overseas)- 20.6%- 22.4%- 21.3%Peach John Business

ー

+8.7%

- 47.3%

Other Businessesー+3,525.0%+1,157.1%- 17.1%+27.3%

+5.6%

total

*The subsidiaries that recorded operating losses are not liste

4Net Sales per Quarterby Major Corporations for FY2020 (YoY comparison) Wacoal’s retail and web businesses maintained their growth. Ai was affectedby bad weather in July.
 Europe recovered in the second quarter with the start of new transactions.

Net sales

1Q

2Q

First Half

Wacoal

+1.2%

+9.1%

+5.3%

（Wholesale Division）- 2.2%

+8.2%

+3.2%

（Retail end WEB Business Department）

+8.7%

+9.1%

+8.9%

Ai

- 10.4%- 18.5%- 16.1%Peach John- 4.4%+4.2%- 0.1%

Lecien- 11.1%- 4.2%- 7.4%

Nanasai- 23.5%+9.8%- 7.5%

Wacoal International Corp. (U.S.)★

- 6.8%+3.7%- 1.7%

Wacoal Europe Ltd.★

- 6.8%+11.0%+1.6%

Wacoal China Co., Ltd.★

+3.2%

+2.1%

+2.7%

★ Comparison with previous period in local currency

5

Operating Income per Quarterby Major Corporations for FY2020 (YoY comparison) Wacoal increased income in the second quarter with increased sales.
 The U.S. saw significantly reduced income due to the recorded operating loss andacquisition costs for IO.

Operatingincome1Q

2Q

First Half

Wacoal- 22.5%+60.7%+25.1%（Wholesale Division）+1.5%+26.3%+15.2%（Retail end WEB Business Department）+14.6%+68.9%+37.2%Aiー- 30.1%ーPeach John

ー

+8.7%

- 47.3%

LecienーーーNanasai- 90.8%+86.3%- 8.3%

Wacoal International Corp. (U.S.)★

- 26.4%- 59.8%- 38.7%

Wacoal Europe Ltd.★

- 21.0%+6.0%- 9.2%

Wacoal China Co., Ltd.★

- 12.9%- 4.1%- 9.3%★ Comparison with previous period in local currency*The subsidiaries that recorded operating losses are not listed

6

FY2020 First Half (Executive Summary) Net sales ended at the same level as the same period of the previous year.
Estimates were not achieved (difference of ¥3.55 billion)
 Operating income exceeded estimates for increased Wacoal sales(exceeded by 5.5%)
 The amount of change of the assessed value of equity securities was -¥0.96
billion (recorded as valuation loss on marketable securities and investments)
Net sales¥101.45 billion (down ¥0.37 billion (0.4%) year on year)(reached 96.6% of the plan total and fell short of it by ¥3.55 billion)

Wacoal’s retail and web businesses remained steady through first half. The wholesale business increased sales from the effects oflast-minute demand.



The U.S.’s department store channel struggled. Europe improved in the second quarter.

Domestic subsidiaries continued to struggle.

Operating income¥9.5 billion (up ¥0.5 billion (5.6%) year on year)(reached 105.5% of the plan total and exceeded it by ¥0.5 billion)

Wacoal increased income with increased IT expenses related to omni-channel construction, the effects of increased sales, and reduced
SG&A costs.
The U.S. saw significant reduced income due to the effects of acquiring IO and the decrease in sales of existing businesses.

Income before income taxes and equity in
net income of affiliated companies¥9.33 billion (down ¥6.99 billion (42.8%) year on year)(reached 98.2% of the plan total and fell short of it by ¥0.17 billion)*Effects caused valuation gain or loss on marketable securities and investments not reflected in estimate

Recorded valuation loss on marketable securities and investments (¥0.96 billion): Valuation gain of ¥5.66 billion in the same period
in the previous year, change of -¥6.62 billion YoY

7

Consolidated Financial Results Summary for FY2020 First Half
(Millions of yen)

FY2019 First Half results,(From April 1, 2018 toSeptember, 2018)

% Of
sales

FY2020 First Half results,(From April 1, 2019 to
September, 2019)

% Of
sales

101,450

FY2020 First Half target,(From April 1, 2019 to
September, 2019)

Consolidated net sales

101,815

Cost of Sales

46,33045.5

44,992

44.3

47,429Gross Margin

55,48554.5

56,458

55.7

S, G&A Expenses

46,491

45.7

46,963Operating Income

8,994

8.8

Other profit or loss

1,657

A：Valuation gain (loss) on marketablesecurities and investments – net

Year on Year
% Of
sales

105,000

ChangeCompared with Target% Change

Change% Change-365- 0.4%-3,550- 3.4%

45.2-1,338- 2.9%-2,437- 5.1%

57,571

54.8

973

+1.8%

-1,113- 1.9%

46.3

48,571

46.3

472

+1.0%

-1,608- 3.3%

9,495

9.4

9,000

8.6

501

+5.6%

495

+5.5%

ー

789

ー

500

ー

-868

- 52.4%289+57.8%

5,660

ー

-958

ー

0

ー

-6,618ー-958

ー

Income Before Taxes

16,311

16.0

9,326

9.2

9,500

9.0

-6,985- 42.8%-174- 1.8%Net income attributable to
Wacoal Holdings Corp.

11,391

11.2

6,668

6.6

7,000

6.7

-4,723- 41.5%-332- 4.7%

Reference figure (i): Income Before Taxes nottaking into account A

10,651

10.5

10,284

10.1

9,500

9.0

-367

- 3.4%

784

+8.3%

8

Overview of Each Operation Segment for FY2020 First Half
(Millions of yen)
FY2019 First Half results,(From April 1, 2018 toSeptember, 2018)

ratio

FY2020 First Half results,(From April 1, 2019 to
September, 2019)

Consolidated net sales

101,815100

Wacoal Business (Domestic)

58,585

Wacoal Business (Overseas)

Year on Year

Compared with Target

ratio

FY2020 First Half target,(From April 1, 2019 to
September, 2019)

ratio

101,450100

105,000

100-365- 0.4%-3,550- 3.4%

57.5

60,36059.5

61,600

58.7

1,775

+3.0%

-1,240- 2.0%

28,821

28.3

27,25326.9

29,20027.8-1,568- 5.4%-1,947- 6.7%

Peach John Business

5,470

5.4

5,466

5.4

6,100

5.8

-4

- 0.1%-634- 10.4%

Other Businesses

8,939

8.8

8,371

8.3

8,100

7.7

-568

- 6.4%

271+3.3%

FY2019 First Half results,(From April 1, 2018 toSeptember, 2018)

% Of
sales

FY2020 First Half results,(From April 1, 2019 to
September, 2019)

% Of
sales

FY2020 First Half target,(From April 1, 2019 to
September, 2019)

Change% Change

Year on Year
% Of
sales

ChangeChange% Change

Compared with Target% Change

Change% Change

Operating income

8,994

8.8

9,495

9.4

9,000

8.6

501

+5.6%

495

+5.5%

Wacoal Business (Domestic)

4,964

8.5

6,288

10.4

5,600

9.1

1,324

+26.7%

688+12.3%

Wacoal Business (Overseas)

3,841

3.8

3,023

3.0

3,200

3.0

-818

- 21.3%-177- 5.5%

182

3.3

96

1.8

200

3.3

-86

- 47.3%-104- 52.0%

7

0.1

88

1.1

0

0.0

81

―

88

―

Peach John Business
Other Businesses

9Financial Results by Major Corporations for FY2020 First Half
(Millions of yen)

Net Sales

Operating Income
Year on Year

Compared with Target

FY2019 First Half results, FY2020 First Half results,(From April 1, 2018 to(From April 1, 2019 to
September, 2018)
September, 2019)

FY2020 First Half target,(From April 1, 2019 to
September, 2019)

Change% Change

Change% Change

Year on Year

Compared with Target

FY2019 First Half results, FY2020 First Half results,(From April 1, 2018 to(From April 1, 2019 to
September, 2018)
September, 2019)

FY2020 First Half target,(From April 1, 2019 to
September, 2019)

Change% Change

Change% Change

Wacoal

52,58055,36655,842

2,786

+5.3%

-476

- 0.9%

3,989

4,991

4,200

1,002

+25.1%

791+18.8%

Peach John

3,098

2,598

3,084

-500

- 16.1%-486- 15.8%

-58

19

216

77

ー

-197

- 91.2%

Nanasai

5,470

5,466

6,100

-4

- 0.1%-634- 10.4%

182

96

200

-86

- 47.3%-104- 52.0%

Lecien

3,223

2,985

3,093

-238

- 7.4%-108- 3.5%

-199

-128

-147

71

ー

19

ー

Ai

4,967

4,594

4,150

-373

- 7.5%

444+10.7%

204

187

60

-17

- 8.3%

127 +211.7%

Wacoal International
Corp. (U.S.)

10,565

10,228

10,469-337- 3.2%-241- 2.3%

1,896

1,147

1,597

-749

- 39.5%-450- 28.2%

Wacoal Europe Ltd.

7,398

6,993

7,407

-405

- 5.5%-414- 5.6%

789

668

664

-121

- 15.3%4+0.6%

Wacoal China Co., Ltd.

6,250

6,084

6,437

-166

- 2.7%-353- 5.5%

874

752

573

-122

- 14.0%179+31.2%

Major Overseas Subsidiaries (Local Currency Basis)
Wacoal International
Corp. (U.S.)

95,817

94,151

95,175-1,666- 1.7%-1,024- 1.1%

17,204

10,55014,510-6,654- 38.7%-3,960- 27.3%

Wacoal Europe Ltd.

50,354

51,14451,080

790

+1.6%

64

+0.1%

5,367

4,873

4,572

-494

- 9.2%

301+6.6%

Wacoal China Co., Ltd.

365,739

375,527

390,100

9,788+2.7% -14,573- 3.7%

51,10746,35534,753-4,752- 9.3%

11,602+33.4%【Exchange rate】

USD

GBP

CNY

108.63 yen

136.73 yen

16.20 yen

10

YoY Increase/Decrease in Net Sales of Each Business Net Sales: Down ¥0.36 billion(¥1.01 billion effect from foreign currency translation)
Wacoalother businesses
Deletion of Interdepartment
Wacoaltransactions
Retail and+0.32
Web Businesses+1.07
The U.S.
-0.18

WacoalWholesale+1.4

Europe
+0.12

China
+0.17

Consolidation effects
from IO (¥350 million)
and existing
businesses struggling-0.53

Hong Kong W -3.3
・Impact of changes in transaction
conditions for PJ business・Slump in Thai materials company-3.0(Billions of yen)

Other
Exchangeoverseasfluctuations
corporations
-1.01
-0.66
PJ
±0

Changes in accounting policy

Nanasai-0.37

・Outsourcing commission
revenue of sales staff

Lecien
-0.24
Ai
-0.5

FY3/19First Half

Continued high growth at
directly managed retail storesand in-house e-commerce¥101.8Last-minute demand contributed towholesale business・Wacoal brand underwear ＋0.68
・Wing brand underwear +0.97

Affect from completion oflarge-scale construction in
the same period ofprevious year

Stagnation due to bad
weather during peakseason (July)

Other
adjustment-0.47

FY3/20First Half

¥101.411

YoY Increase/Decrease in Operating Income of Each Business Operating Income: Up ¥0.5 billion(-¥0.12 billion effect from foreign currency translation)
WacoalRetail and
Web Businesses+0.38
WacoalWholesale
Business+1.4(Billions of yen)

Wacoalback-office
SG&A
-0.78

Other
overseas
corporations+0.18
The U.S.
-0.73

FY3/19First Half

Other
adjustment+0.27

Europe
-0.06

China
-0.08

・Increase in omni-channel strategy IT
system related expenses (+0.3)
・Increase in retirement benefit expenses(before consolidation adjustment)

Lecien+0.07
Exchange
fluctuations
-0.12

PJ
-0.09

China, Europe
Increase in labor andadvertising costs¥9
IO operating loss -0.2
M&A costs -0.22
Impact from decreased income
in existing businesses -0.31

Ai
+0.08

Nanasai-0.02

FY3/20First Half

Contributions from seasonal
store control in Ai

¥9.5

12

First Half Net Sales Progress for FY2020
 Net Sales: Missed estimate at ¥3.6 billion(¥0.72 billion effect from foreign currency translation)

WacoalWholesale-0.78

FY3/20First Half
Estimate¥105

Wacoalother businesses
Deletion of InterWacoal
department
Retail andtransactions
Web
+0.23
Businesses+0.08
The U.S.
-0.11

Wholesale business except
GMS and supermarkets (Wing)
failed to achieve estimates・Wacoal underwear -0.55
・Products other thanunderwear -0.63

FY2020First Half

results

targetWacoal Business(Domestic)
Wacoal Business(Overseas)

Slump in Thaimaterials company-0.44, etc.

Europe+0.01

FY2019First Half

58.6

61.6

3.0

28.8

29.2

0.4

Peach John Business

5.5

6.1

0.6

Other Businesses

8.9

8.1

-0.8

101.8

105.0

3.2

total

China
-0.24

ChangeAcquisition of construction
business exceeding estimate
Consolidation effects
from IO (¥350 million)
and existing businesses
missed estimates-¥460 million

Other
Exchangeoverseas fluctuations
corporations
-0.72
-0.88

(Billions of yen)

Nanasai+0.44
Lecien
-0.11

PJ
-0.63

Reduced discount sales forbusiness efficiency
improvements

Ai
-0.49

Stagnation due to bad
weather during peakseason (July)

Other
adjustment FY3/20-0.34
First Half

Results¥101.413

First Half Operating Income Progress for FY2020
 Operating Income: Up ¥0.5 billion(-¥0.88 billion from foreign currency translation)

WacoalRetail and
Web Businesses+0.37
WacoalWholesale
Business+0.28

Wacoalback-office
SG&A
+0.15
China
+0.19

FY3/20First Half
Estimate¥9targetChange

5.0

5.6

0.6

3.8

3.2

-0.6

Peach John Business

0.2

0.2

0.0

Other Businesses

0.0

0.0

0.0

9.0

9.0

0.0

Nanasai
+0.13
PJ
-0.1

The U.S.
-0.44

・Retail and web business reached estimate
・Wholesale business reduced SG&A costs
although net sales increase was not achieved(decrease in labor costs, postponement of SG&A
costs -¥600 million)

results

total

Exchange
fluctuations-0.08

Reduced SG&A costsin China and Europe

FY2020First Half

Wacoal Business(Domestic)
Wacoal Business(Overseas)

Otheroverseas
corporations+0.09

Europe+0.05

FY2019First Half

Reduced SG&A costs
domestically, and stagnating
China business

Lecien+0.02(Billions of yen)

Other
adjustment
+0.04
Ai
-0.2

Missed estimate due
to bad weather

FY3/20First Half
Results¥9.5

IO operating loss -0.2
M&A costs -0.18
Existing businesses missed estimates14

Basic Principle of Capital Policies
 Prioritize investments for future growth while striving to enhanceshareholder returns
 Achieve ROE of 6% exceeding capital costs
 Maintain total return ratio of 100%
 Reduce strategically-held shares (target: 30% reduction)

15

Capital Policies and Shareholder Returns
 Steady execution of sales of strategically-held shares(IO acquisition explained on page 43)(Billions of yen)(Billions of yen)

FY2020First Half

Medium-Term
Management Plan Period（FY2020-FY2022）

Medium-Term
Management Plan Period（FY2020-FY2022）

results

total

plan

Net income attributable to
Wacoal Holdings Corp.★

7.3

ー31.0 or more

The acquisition of IO

9.2

depreciation costs
Cashgeneration Sales of strategically-held

2.8

ー

19.0 or more

1.7

3.3

ー

20.0 or more

13.4

ー

70.0 or more

IT-related investment,etc(wacoal）
Interior finish work for directly
retail stores, etc（wacoal）
Building renovation, etc（wacoal）

Domestic Subsidiaries

0.2

Overseas Subsidiaries

1.0

sharestotal
Growth investment,
Capital expenditures

12.6

ー

Dividend payment

2.4

ー

3.1

ー

・Dividend/Reasury stock:（1,176 thousand shares）

ー

18.1

ー

・Investmen in existing business t/Growthinvestment: \21billion or more・Additional returns or investment in new
business: \16.5billion or more

Used Cash Purchase of treasury stock（Number of shares acquired）

total

68.5 or more

Major investments and investment
amount in the first half of FY2020
detailamount0.3
0.2\31billion or more★Net income was calculated without consideration for valuation gain (loss) on marketable securities and investments.

■Major KPI
Status of sales of Sale amountstrategically-heldsharesProgress toward target(Wacoal Corp.)
Number of strategic stocks sold★★

completely

3.3

ー

16%

ー

0.8

ー

20.0

total

12.6

16

Full Year Business Performance Forecast for FY2020
 Full business year earnings and dividend forecasts are as initially planned(Millions of yen)

FY2020Full-year
forecast

FY2019% Of
sales

Full-year
results

Consolidated net
sales

200,000

Operating Income

11,000

5.5%

4,879

Income Before
Taxes

12,000

6.0%

Net income
attributable to
Wacoal Holdings Corp.

9,000

4.5%

Year on Year

% Of
sales

194,201

Change % Change

5,799

+3.0%

2.5%

6,121

+125%

2,203

1.1%

9,797

+445%

341

0.2%

8,659 +2,539%*The business performance forecasts do not reflect the effects of business performance fluctuations caused byvaluation gain or loss on marketable securities and investments.
*(USD1=JPY110.00, GBP1=JPY145.00, CNY1=JPY16.50)

interim dividend

ordinary dividend
36yen

40yen special dividend

36yen

4yen

year-end dividend（Dividend forecast）

ordinary dividend
36yen

40yen special dividend
4yen

36yen

17

Estimated Operating Income in Second Half for FY2020
 Reflects expected operating loss of IO(plan to decrease by ¥0.4-¥0.5 billion yen in second half) Expect initial estimate of ¥2 billion for existing businesses<Risks not reflected in estimates> Decline of domestic consumption exceeding expectations due to consumption tax increase(further reduction of domestic distribution channels)
 Impact of continuing uncertainty from Brexit
 Fixed asset impairment risk of subsidiaries (Thai material productions company)
 Amortization expenses related to IO brand and customer list
(Recorded from the current quarter. Timing and impact being calculated)(Millions of yen)

FY2020Operating
IncomeChangeFY2020 target

First Half
results

Secondhalf
forecast

Full-year
forecast

First Half
results

Secondhalf
forecast

Full-year
forecast

9,495

1,505

11,000

9,000

2,000

11,000

495

▲ 495

0

18

Fiscal Year Ending March 31, 2020
First Half Business Situation(April-September)and Second Half Initiatives
Hironobu Yasuhara
Wacoal Holdings Corp.
President

19Sincere Gratitude

We celebrated our 70th anniversary on November 1, 2019
We will continue to make constant progress to be a company
that will survive for more than 100 years<Our Vision>We, the employees and management of Wacoal,
will maintain a refined corporate culture based on
mutual trust and will continually strive to makethe Company a global leader in the industry.

Founder, Koichi Tsukamoto

20

FY2020 First Half Review
Introduced new customer service systems using 3D bodyscanners and customer service AI at 2 stores (Omotesando(Tokyo),
Shinsaibashi(Osaka))Acquired Intimates Online, Inc. (brand name: LIVELY) to create
opportunity for e-commerce growth and strengthen
competitiveness Last-minute demand before the consumption tax increase helped
domestically Growth in e-commerce continued, but slowed for real stores
 Downward impact of currency translation
 Implementation of initiatives to improve profitability by domestic
subsidiaries
 Incorporation of IO acquisition costs and operating loss, but
operating income exceeds estimates

21

FY2020 Second Half Priority Measures
Continue initiatives to strengthen brand power in each countryStrengthen monitoring of progressFurther improve profitability (thorough cost management) Domestic:Rebuilding customer relationships through promotion ofomni-channel strategy（increased introduction of 3D body scanners and customer service AI)
 Overseas: Strengthen in-house e-commerce (U.S. and Europe),
strengthen alliances with e-commerce operators (China)
 Domestic subsidiaries: Select and concentrate business, review
business structure to improve profitability
 ESG promotion (CSR procurement)
22

Wacoal Corp.
First Half Business Situation andSecond Half Initiatives
Tomoyasu Ito
Wacoal Corp.
President and Representative Director

23First Half Overview of Wacoal for FY2020 <sales by channel>
 In-house e-commerce continues strong growth and directly
managed retail stores maintain stable growth Department stores: Same level as the previous year (Wacoal brand underwear only: +2%)
 GMS and supermarkets: Successful strengthening of Wing brand product strength. Increased 12%
in the first half.
◆Quarterly change in sales at storesby sales channel of Wacoal Corp.

1Q

2Q

First Half

-6%

+8%

+0%

-4%

+15%

+6%

+4%

+19%

+12%

Specialty Stores

+4%

+6%

+5%

Sports Chains

-11%

+11%

+0%

Third Party EC Sites

-7%

+5%

-1%

Retail stores

+6%

+6%

+6%

Wacoal’s Own EC Site

+18%

+24%

+21%

Catalog mail‐order

+10%

+6%

+7%

Department store

Wholesale

Retail

GMS,Supermarket（Wacoal Brand）
GMS,Supermarket（Wing Brand）

24

First Half Overview of Wacoal for FY2020 <Wholesale Business>
 Mainstay underwear business is solid, centering on the Wing brand Growth of “Synchro” Bra with increased comfort and “Night Up Bra” for sleeping.
 Sales of products other than underwear were sluggish due to the struggling main channel(department stores).
◆Sales of each business in
Wholesale Business Division of Wacoal Corp.

1Q

2Q

First Half

Wacoal

-4%

+11%

+3%

Wing

+11%

+8%

+9%

Wacoal

-10%

+6%

-3%

Wing

-38%

-10%

-25%

Family wear Business

Wacoal

-17%

-6%

-12%

Good Age Business

Wacoal

-2%

-8%

-5%

Leg Carson Business

Wacoal

-3%

-2%

-2%

Men's inner Business

Wacoal・Wing

-9%

+2%

-3%

Wellness Business

CW‐X、Wacoal

-8%

+3%

-2%

-2%

+8%

+3%

Innerwear Business

Personal Business

Wholesale Division total

25

First Half Overview of Wacoal for FY2020 < Net Sales>¥55.37 billion (up ¥2.79 billion (5.3%) year on year)

Net sales(reached 99.1% of the plan total and fell short of it by ¥0.48 billion)

Sales increased due to underwear sales expansion in wholesale business.

Achieved estimates in retail and web business by maintaining good performance throughout the first half
(Millions of yen)
FY2019 First Half results, FY2020 First Half results, FY2020 First Half target,(From April 1, 2018 to(From April 1, 2019 to(From April 1, 2019 to
September, 2018)
September, 2019)
September, 2019)Year on Year

ChangeComparedwith Target

ChangeWacoal

21,51622,191

22,738

675

-547

Wing

10,52911,496

11,445967

51

Wacoal

2,781

2,689

2,844

-92

-155

Wing

400

301

165

-99

136

Family wear Business

Wacoal

1,876

1,657

1,685

-220

-28

Good Age Item,Leg Item,
Men's inner Business

Wacoal

2,513

2,428

2,768

-85

-340

CW‐X、Wacoal

2,576

2,523

2,768

-53

-244

1,127

1,435

1,088

308

347

Wholesale Division total

43,32044,72145,500

1,401

-779

Retail end WEB Business Department

11,98913,057

12,980

1,067

77

Others(Intersegment transactions,etc.)-1,896-1,573-2,050322

476

Net sales★

53,41356,20456,430

2,791

-226

Innerwear Business

Personal Business

Wellness Business
Others★The figure before the transfer of internal expenses.

26

First Half Overview of Wacoal for FY2020 <Operating Income>Operating income¥4.99 billion (up ¥1.0 billion (25.1%) year on year)(reached 118.8% of the plan total and exceeded it by ¥0.79 billion)

Wholesale: Effect of increased sales. Improved profit margin due to lower return rate(+0.9 pt)
also contributed.
 Retail: Effect of increased sales. Improved profit margin due to reduced discount sa les(+0.7 pt)
also contributed.
 Back Office SG&A: Increase in IT system costs and retirement benefit expenses related toomni-channel construction (before consolidated adjustment)
Postponement of some advertising expenses to the third quarter(Millions of yen)
FY2019 First Half results, FY2020 First Half results, FY2020 First Half target,(From April 1, 2018 to(From April 1, 2019 to(From April 1, 2019 to
September, 2018)
September, 2019)
September, 2019)Year on Year
ChangeComparedwith Target
ChangeWholesale Division

9,182

10,58010,3001,398

280

Retail end WEB
Business Department

1,018

1,398

1,033

380

365

Indirect department
SG&A expenses★

-6,211-6,987-7,133-776

146

Operating income

3,989

4,991

4,200

1,002

791

27

First Half Overview of Wacoal for FY2020 <Topics>

Introduced new service called “3D smart & try" using 3D body scanners and customer service AI(Tokyu Plaza Omotesando Harajuku(Tokyo) in May 2019, Daimaru Shinsaibashi(Osaka) in September 2019)Plan to introduce it to a total of more than 5 stores in second half

Progress of Wacoal 3D smart & try
Tokyu Plaza Omotesando Harajuku (5/30-10/10)
 Total number measured with 3D body scanners:

About 5,400 people(Monthly average of about 1,050 people)
 Percentage who made purchases: About 30%
 Customers purchasing Wacoal products for the first time:

About 60%
 Average purchase unit price: ¥22,000 (purchases after consulting)Wacoal 3D smart & try
Tokyu Plaza Omotesando Harajuku(Tokyo)
Floor: 4th floor 3D body scanners: 3
Area: about 110 m²
Tablets: 8￥13,000 (self purchasing) Composition by age: 60% are 20-34 years old
 Digitalization of customer information makes it possible to understandand analyze the behavior and timing of purchases at in-house ecommerce and other stores after measurement at store.
28

WacoalOmni-channel Service Strategy

 Expand the service network based on physique data and rebuild
customer relationships (deeper, wider, longer)
Create new products and services by leveraging multifaceted personal data on customers● Utilize data in R&D ● Develop new product and services● Utilize data in co-creation with other companies

Provide personalized customer services●Increase the percentage of regular customers ●Attract younger customers ●Maximize sales opportunities

Strengthening competitive advantage

Improving business productivity

Creating the future of underwear customer experiences

Operational innovation in physiclal store

Personalizedapp

AI forattending tocustomers

3D bodyscanner

Electronic customer charts

Tablet for attending tocustomers

Company-wide database (omni-channel platform)
Customer information

Product information

Inventory information

29

Wacoal Priority Measures for FY2020 Second Half
Improve corporate brand power by strengthening “MEET YOUR JUST.” marketing

Wholesale: Sales floor reform through introduction of 3D body scanners andcustomer service AIRetail: Products and promotions driving demand from new and existing customers



Further improve profitability

 Expand customer contact points with new products that incorporate body care
perspective (Wacoal brand) Develop new business partners (Wing brand) Implement purchasing behavior analyses based on customer data and strengthen
approach (retail/web)
 Implement “selection and concentration” to improve profitability (except underwear) Introduce personnel management
30

(Reference) Wacoal Store Sales in September/October(Rate of Change / Preliminary Report)◆Sales data by channel （reference value）

Sep.

Oct.

Department store

+26%

-24%

GMS,Supermarket

+55%

-26%

Specialty Stores

+24%

-13%

Retail stores

+17%

-3%

Wacoal’s Own EC Site

+34%

+16%

Wholesale

Retail*This is a reference value
31

Domestic Subsidiaries
First Half Business Situationand Second Half Initiatives

32

First Half Overview of Peach John for FY2020 <Domestic Subsidiary>
Net sales¥5.47 billion (down ¥4 million (0.1%) year on year)(reached 89.6% of the plan total and fell short of it by ¥0.63 billion) Domestic: Recovered in the second quarter. Increase in retail business due to increase in number ofvisitors before tax increase. Reduced discount sales for improved profitability.
 Overseas: Sales were sluggish in Hong Kong due to sluggish sales of standard products. New store
openings in Taichung, Taiwan contributed to sales.
Operating income¥0.1 billion (down ¥0.09 billion (47.3%) year on year)(reached 48% of the plan total and fell short of it by ¥0.1 billion) Domestic: Income increased from improved profit margin due to reduced sales and reduced SG&A costs.
 Overseas: China business had an operating loss.
◆Peach John Salesby domestic business・Quarterly change

Domestic

1Q

2Q

First Half

ratio

Mail-order

-13%

-3%

-8%

43%

Store

-3%

+10%

+4%

57%

1Q

2Q

First Half

Hong Kong

-24%

-31%

-27%

Taiwan（stores＋EC）

+5%

+2%

+3%

Shanghai・Beijing etc（Retail stores）
Shanghai・Beijing etc（Third party EC sites）

-19%

-24%

-22%

+9%

-48%

-29%

Shanghai・Beijing etc total

-2%

-41%

-26%

◆Peach John Salesby overseas business・Quarterly change

Overseas★★Change rate based on local currency. The rate of increase or decrease in sales at retail stores and EC sites in each region.
（The figures for" Shanghai・Beijing etc" are from January to June.）33

First Half Overview of Ai for FY2020 <Domestic Subsidiary>
Net sales¥2.6 billion (down ¥0.5 billion (16.1%) year on year)(reached 84.2% of the plan total and fell short of it by ¥0.49 billion)
 Demand for swimwear sluggish due to bad weather in highest demand period (July).
 Increased sales from newly proposed resort wear group. Underwear business also ended at thesame level as the same period of the previous year.

Operating income¥0.02 billion (¥0.06 billion loss, up ¥0.08 billion year on year)(reached 8.8% of the plan total and fell short of it by ¥0.2 billion)

 Impact of decreased income.
 Return to profitability by reducing SG&A costs through reviewing store launch strategy.

◆Ai Sales by division・Quarterly change

Resort wear
（A former name of Swimwear）

Innerwear

1Q

2Q

First Half

ratio

-12%

-21%

-19%

82%

+0%

+0%

+0%

18%

34

First Half Overview of Lecien for FY2020 <Domestic Subsidiary>
Net sales¥2.99 billion (down ¥0.24 billion (7.4%) year on year)(reached 96.5% of the plan total and fell short of it by ¥0.11 billion)

 Shrunk material business that carries clothing fabrics and lace from the viewpoint of profitability.
 Orders of GMS and supermarket private brands increased.

Operating Loss

¥0.13 billion (¥0.2 billion loss, up ¥0.07 billion year on year)(estimate: -¥0.15 billion, difference +¥0.02 billion)
 Impact of decreased income.
 Operating loss narrowed from the same period of the previous year due to SG&A cost reductions.
◆Lecien Sales by division・Quarterly change

Manufacturing business（A former name of Innerwear,Apparel Div.）

Material business（A former name of Material,Art Hobby Div.）EC planning and sales business（Wacoal’s Own EC Site・Third party EC sites)

1Q

2Q

First Half

ratio

+3%

+3%

+3%

75%

-9%

-3%

-6%

23%

+20%

+24%

+22%

2%
35

First Half Overview of Nanasai for FY2020 <Domestic Subsidiary>
Net sales¥4.59 billion (down ¥0.37 billion (7.5%) year on year)(reached 110.7% of the plan total and exceeded it by ¥0.44 billion)
 Rebound from completion of renovations at major department stores in the same period of theprevious year.
 Acquired new projects among brisk construction demand. Exceeded estimates.

Operating income¥0.19 billion (down ¥0.02 billion (8.3%) year on year)(reached 212% of the plan total and exceeded it by ¥0.13 billion)

 Impact of decreased income.
 Operating income exceeded estimates due to new orders in construction business.

◆Nanasai Sales by division・Quarterly change

1Q

2Q

First Half

ratio

Rental and lease

-13%

-8%

-10%

20%

Production sales

-21%

-21%

-21%

16%

Construction

-27%

+33%

+1%

64%
36

Domestic Subsidiaries
Business Restructuring Progress / Second Half Initiatives
Peach John

Decision to stop issuing catalogs and close 8 unprofitable
stores to improve profitability
 Transition to new management system from April 2019 Launch new line to target new mid 20s customer segment(from January 2020)

 Continued sales expansion of campaign bra “Smart Bra”

Ai

Aim to break away from summer-oriented business andswitch to resort wear business from swimwear business Reduce SG&A costs through reviewing store launch strategy
 Increase proportion of our own developed products(expected to be 61% for current term)
 Sales through e-commerce channels in China

LecienShrink material business such as clothing fabrics and lacefrom the viewpoint of profitability
 Propose reform of GMS and supermarket underwear sales floors in collaboration with
Wacoal and acquire private brand orders
 Expand product supply to Wacoal Group including overseas

 Consider measures to improve profitability

37

Overseas Subsidiaries
First Half Business Situationand Second Half Initiatives

38

First Half Overview of Wacoal International Corp. (The U.S.) for FY2020< Overseas Subsidiary>
Net sales¥10.23 billion (down ¥0.34 billion (3.2%) year on year)(reached 97.7% of the plan total and fell short of it by ¥0.24 billion)

Inventory adjustments at department stores (real stores) affected deliveries. In-house e-commerce
continued to maintain high growth.
Incorporated IO August/September sales (¥0.35 billion).

¥1.15 billion (down ¥0.75 billion (39.5%) year on year)

Operating income(reached 71.8% of the plan total and fell short of it by ¥0.45 billion)

Sales in existing businesses declines, but the profit margin increased due to an increase in ratio of in-house ecommerce(0.3 pt).
Recorded IO operating loss (¥0.2 billion) and one-time expenses related to M&A (about ¥0.22 billion)◆(The U.S.) Quarterly change in sales in major channels and regions (in local currency)
1Q
2Q
First HalfStore

ChannelEC sites

Area

ratio

Department store

-12%

-9%

-11%

Outlet・Retail store

-23%

-30%

-27%

Store sales total

-12%

-10%

-11%

Department store EC sites-2%+18.7%+7.3%

Third Party EC sites

-2%

+4.6%

+0.7%

Wacoal’s Own EC Site

+17.0%+33.1%+24.2%

EC sales total+4.0%+19.2%+10.5%

America

-7%

-2%

-4%

96%

Canada

+2.0%

-5%

-2%

4%

66%

[Reference]

Local currency
basis(year-on-year)34%

Net sales -1.7％
Operatingincome -38.7％
39First Half Overview of Wacoal Europe for FY2020 < Overseas Subsidiary>
Net sales¥6.99 billion (down ¥0.41 billion (5.5%) year on year)(reached 94.4% of the plan total and fell short of it by ¥0.41 billion)Successful strengthening of “Fantasie”, “Elomi” and “Freya” brands to meet diverse size needs



The U.K. struggled due to sluggish department stores, but other regions were solid(The U.K. -7%, Europe +8%, North America +5%, Other regions +6%)

¥0.67 billion (down ¥0.12 billion (15.3%) year on year)

Operating income(reached 100.4% of the plan total and exceeded it by ¥4 million)

Profit margin decreased due to increase in inventory valuation allowance due to reduction of outlet transactions



Decreased due to increase in sales staff and increased advertising costs associated with new transactions with Spanish
department stores◆(Europe) Quarterly change in sales in major channels and brands (in local currency)

Channelstore
EC sites

Brand

1Q

2Q

First Half

ratio

Department store

-27%

+7%

-12%

21%

Specialty store

-5%

+10%

+2%

52%

Retail stores

-15%

-6%

-11%

6%

[Reference]

Third party EC sites/other

+19%

+29%

+24%

21%

(year-on-year)

Fantasie

-5%

+20%

+7%

34%

Freya

-17%

+1%

-10%

24%

Goddess

-13%

+3%

-5%

6%

Elomi

+6%

+15%

+11%

23%

Wacoal

-8%

+8%

+1%

12%

B.Tempted

-16%

-17%

-17%

1%

Local currency basis

Net sales ＋1.6％
Operating income
-9.2％

40

First Half Overview of Wacoal China for FY2020 < Overseas Subsidiary>
Net sales¥6.08 billion (down ¥0.17 billion (2.7%) year on year)

Closed department stores and sluggish Peach John business impacted sales
E-commerce maintained high growth by strengthening alliances with e-commerce operators and developing
sales promotions during demand periods

Operating income(reached 94.5% of the plan total and fell short of it by ¥0.35 billion)¥0.75 billion (down ¥0.12 billion (14.0%) year on year)(reached 131.2% of the plan total and exceeded it by ¥0.18 billion)

Profit margin improved from increased e-commerce sales ratio (1.3 pt)
Recorded one-time expenses accompanying warehouse relocation, in addition to an increase in advertising expenses toexpand e-commerce sales◆(China) Quarterly change in sales in major channels and brands (in local currency)

ChannelBrand[Reference 1]

1Q

2Q

First Half

ratio

Local currency basis

Department store

+2%

-3%

0%

77%

Third party EC sites

+22%

+26%

+24%

23%

Net sales ＋2.7％
Operating income-9.3％

Wacoal

+6%

+11%

+8%

83%

Salute

-11%

-16%

-14%

9%

LA ROSABELLE

-42%

-19%

-31%

1%

Peach John

+3%

-38%

-23%

7%

(year-on-year)[Reference 2]

Excluding Peach John
Net sales for Wacoal China(local currency / year-on-year basis)

Net sales +5%
41

First Half Overview of
Other Asian Regions
Net sales＞¥3.95 billion (down ¥0.66 billion (14.3%) year on year)(reached 80.8% of the plan total and fell short of it by ¥0.94 billion)

Orders decreased for warp knitting and circular knitting materials from Thai materials factory (-¥0.33 billion)
Impact of changes in transaction conditions between Hong Kong Wacoal and Peach John Hong Kong
(Account for Peach John store sales in Hong Kong changed from Hong Kong Wacoal to Peach John segment)

Operating income＜Hong Kong Wacoal, Wacoal International Hong Kong, Wacoal Singapore, Philippines Wacoal,
Wacoal India,(Factories) Dalian Wacoal, Guangdong Wacoal, Vietnam Wacoal, Myanmar
Wacoal, A-Tech, G-Tech and 1 other company¥0.46 billion (up ¥0.17 billion (61.7%) year on year)(reached 124.6% of the plan total and exceeded it by ¥0.09 billion)

Increased productivity at Dalian factory, production base for seamless garments
Number of storesFirst Half Overview of Wacoal India
Net sales¥0.1 billion(109% of plan total)

Operating loss

¥0.05 billion(exceeded plan total by¥3 million) Started transactions with department stores in July（at the end of Mar‐2019）

Retail stores18

EC sites

4

Department
store

8

 Directly-managed stores: Existing stores in first half +48% YoY, +22% YoY(local currency basis)
 Competitor e-commerce: Missed estimates due to delayed start in deployment
42

First Half Topics for Overseas Wacoal BusinessMade U.S.-based Intimates Online, Inc. (brand name: LIVELY) a wholly-owned subsidiary
Acquisition Price: US$0.085 billion (about ¥9.2 billion)* Separate earn-out consideration (consideration according to achievement level)Create opportunities and strengthen competitiveness in US e-commerce by acquiring DNVB★ company

Corporate Philosophy:
Our mission is to inspire women to live life passionately,
purposefully, and confidently by empowering withproducts and experiences to do so.

Characteristics:
Developed product lineup with uniqueworldview and unique digitalmarketing utilizing SNS

CEO and Founder,

Michelle Cordeiro Grant★ DNVB (Digital Native Vertical Brand)
A brand that plans and develops products internally, is responsible for manufacturing quality, and sells products directly through their own e-commerce channel.
These brands are characterized by directly holding customer information, and take responsibility for the entire value chain vertically from upstream to downstream.

43

First Half Topics for Overseas Wacoal Business Expected synergy effects
 Utilize Wacoal's business base to increase speed of LIVELY brand growth Strengthen digital marketing for entire group Strengthen competitiveness in markets changing with digitalization

 Current Estimates(August 2019 - March 2020)
Net sales

about US$15-16 million

Operating loss

about US$6-7 million

 FY2024 3Q Estimates: net sales of US$1 million, ratio of operating income of 12-15%
 Until FY2021 3Q, prioritize marketing investments to improve brand awareness Amount of goodwill recorded on balance sheet to be finalized in third quarter accounting period Depreciation costs related to the brand and customer lists incurred from current fiscal year
(impact on current period is being calculated)

44

Overseas Subsidiaries Second Half Initiatives
The U.S.

Prioritize strengthening brand power and developing business foundationto achieve future growth Continuously strengthen in-house e-commerce, including LIVELY Business integration with IO (advance integration of management such as accounting
and finance, and logistics)
 Improve productivity by improving manufacturing processes, expand factory in
Dominican Republic

EuropeStrengthen and expand main brands that meet diverse size needs
 Strengthen in-house e-commerce (expand deployed brands in second half) Expand B2B system coverage for specialty stores (the U.S.) Strengthen business with Spanish department stores and develop new business partners

China

Maintain e-commerce growth by strengthening alliances with e-commerce
operators
 Utilize and analyze big data such as customer databases
 Execute marketing strategy to expand sales from Single’s Day (advertisement, securestock)
 Start developing Japanese “Amphi” and Wacoal Europe products to cultivate newcustomers

45

Initiatives Addressing ESG Issues

46

Initiatives Addressing ESG Issues
 Promote CSR procurement based on mutual trust and collaboration
 Ai factory list released in September (Wacoal, Wing, Peach John, Lecien factory list updated) Expand Wacoal Corp. wholesale business (excluding underwear) and retail business division intarget area this quarter In addition, scheduled on-site audits of 20% of target factories

 Enhance awareness of advertising and communication expressions
that respect diverse values
 During previous advertising activities, we received much criticism that we used inconsiderate
expressions
 The Board of Directors investigated the cause and discussed ways to prevent their recurrence
 Established guidelines for creating expressions in public relations / advertising / sales promotion
activities and operational system
 Started operation at Wacoal Corp. and Peach John Co., Ltd., rolled out to other domestic and overseas
subsidiaries for system established by March 2020.

Integrated Report 2019 (PDF version: Japanese) published on our
website on November 1 (English translation will be released in December)47

48

(Reference) Performance Forecast for FY2020(Announced on May 15, 2019)(Millions of yen)
FY2019results

FY2020targetratio

Year on Year
ratio

Change% Change

Consolidated net sales

194,201100

200,000

100.0

5,799

+3.0%

Cost of Sales

89,80446.2

92,100

46.0

2,296

+2.6%

Gross Margin

104,39753.8

107,900

54.0

3,503

+3.4%

S, G&A Expenses

93,68448.2

96,900

48.5

3,216

+3.4%

A: Impairment charges on goodwill
and other intangible assets

5,834

3.0

0

0.0

-5,834ーOperating income

4,879

2.5

11,0005.5

6,121+125.5%

Other profit or loss

2,894

1.5

1,000

0.5

-1,894- 65.4%

B: Valuation gain (loss) on marketable securities
and investments – net-5,570

-

0

5,570

ー

Income before taxes

2,203

1.1

12,0006.0

9,797+444.7%

Net income attributable to
Wacoal Holdings Corp.

341

0.2

9,000

4.5

8,659

ー

Reference figure (i): Operating income not taking into account A

10,713

11,000287+2.7%

Reference figure (ii): Income before taxes not taking into account A and B

13,607

12,000-1,607- 11.8%Reference figure (ⅲ): Net income not taking into account A and B

9,636

9,000

-636

- 6.6%

Exchange rate: Assumed that 1 USD equals 110.00 yen, 1 GBP 145.00 yen and 1 CNY 16.50 yen.

49

(Reference) Estimated Net Sales and Operating Income
by Business Segment for FY2020 (Announced on June 13, 2019)(Millions of yen)

FY2020targetratio[%]

Year on Year

FY2019results

ratio[%]

Change% Change

Consolidated net sales

200,000

100

194,201

100

5,799

+3.0%

Wacoal Business (Domestic)

116,200

58.1

113,400

58.4

2,800

+2.5%

Wacoal Business (Overseas)

55,50027.8

53,100

27.3

2,400

+4.5%

Peach John Business

11,6005.8

10,4915.4

1,109+10.6%

Other Businesses

16,7008.4

17,2108.9-510- 3.0%FY2020target% of net
sales

Year on Year

FY2019results% of net
sales

Change% Change

Operating income

11,000

5.5

4,879

2.5

6,121

+125.5%

Wacoal Business (Domestic)

6,600

5.7

6,325

5.6

275

+4.3%

Wacoal Business (Overseas)

4,000

7.2

4,581

8.6

-581

- 12.7%Peach John Business

170

1.5

-5,859

ー

6,029

ー

Other Businesses

230

1.4

-168

ー

398

ー

Exchange rate: Assumed that 1 USD equals 110.00 yen, 1 GBP 145.00 yen and 1 CNY 16.50 yen.

50

Estimated Net Sales and Operating Income by Major
Corporations for FY2020 (Announced on June 13, 2019)(Millions of yen)
Net Sales
FY2019results

FY2020targetOperating Income
Year on Year

Change% Change

FY2019results

Year on YearFY2020targetChange% Change

Wacoal102,356

105,327

2,971

+2.9%

5,099

4,300

-799

-16%

Peach John

10,491

11,6001,109+10.6%

-220

170

390

ー

Nanasai

9,414

8,800

-614

-7%

282

230

-52

-18%

Lecien

6,284

6,528

244

+3.9%

-375

-9

366

ー

Ai

4,181

4,290

109

+2.6%

-321

53

374

ー

Wacoal International Corp.
(U.S.)

18,48618,750

264

+1.4%

2,095

1,667

-428

-20%

Wacoal Europe Ltd.

14,106

14,655

549

+3.9%

1,407

1,189

-218

-15%

Wacoal China Co., Ltd.

11,617

12,507

890

+7.7%

746

758

12

+1.6%

Major Overseas Subsidiaries (Local Currency Basis)
Wacoal International Corp. (U.S.)

166,679

170,465

3,786

+2.3%

18,90015,150-3,750-20% (USD'000)

Wacoal Europe Ltd.

96,826

101,062

4,236

+4.4%

9,658

8,198

-1,460-15% (GBP'000)

Wacoal China Co., Ltd.

694,776

758,000

63,224+9.1%

44,59445,9001,306+2.9% (CNY'000)

Exchange rate: Assumed that 1 USD equals 110.00 yen, 1 GBP 145.00 yen and 1 CNY 16.50 yen.

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Information within this document with respect to business plans, forecasts, strategies and otherstatements, including business performance figures, is based on Wacoal’s assumptions in the light of theinformation currently available, and in no way precludes the uncertainties and risks inherent in theseforward-looking statements.
Furthermore, actual business results may, as a result of numerous factors, differ significantly from thoseexpressed in statements in this document.
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