1Trias Company Memo 2010-06-11（7483 TSE1） DOSHISHA CO., LTD.
Summary of Business Results Meeting for Fiscal Year Ended March 31, 2010
and its Follow-Up Interview
On May 18, 2010, Trias Corporation attended the FY03/10 Business Results Meeting of DOSHISHA
Corporation (hereinafter DOSHISHA or the Company), which was followed up later by an interview. The
following is a summary of both the meeting, which included a Q&A session, and interview. The former
was led by Masayuki Nomura, Representative Senior Managing Director, while the latter was conductedwith Shinichi Takagaki, Director of Marketing and Investor Relations & Public Relations.
【Corporate Profile and Business Model】
DOSHISHA was founded in 1974 as a wholesaler of sundry goods for daily use. Since then, it has
expanded its business field to include the development and sales of original products, from cabinets
to home appliances and processed foods, while handling the wholesale, planning and sales of premierforeign brand products. The Company’s core strength lies in its proprietary marketing and productdevelopment capabilities, built up through strong ties to some 1,300 suppliers, of which the majority arebased abroad, as well as to its diverse distribution channels which supply some 3,000 domestic clients.
DOSHISHA’s profit growth strategy is based on developing latent needs through innovative solutions toprovide products of niche markets that the major companies prefer not to enter. By providing customized
products that meet specific consumer demand at low prices, the Company aims to generate ¥5 billion
in annual sales at the retail level per division (or DIV, as DOSHISHA prefers to call it). When the DIV
surpasses sales of ¥5 billion, it will be reconstituted into smaller units to mine even further new needs—a system that aims to develop 50 DIVs, each generating ¥5 billion. At the beginning of FY03/11, three
new DIVs were launched, increasing the number to 20 DIVs in total.
Through its divisions, DOSHISHA is engaged in three business models: its Private Brand (PB),
Premier Brands (or FB for Famous Brands), and Gifts, or what it terms NB Processing. The PB businessmodel is the most profitable because the home-use cabinetry and appliances it sells are planned,developed and manufactured in-house. It concentrates mainly on lifestyle-related products in nichemarkets that are not only difficult for major manufacturers to exploit, but are also relatively free frommajor retailers, which are not focusing their own product development resources to tap them. Among theleading PB products are pre-assembled Luminous brand steel racks and design-oriented humidifiers,
which are selling well due to their functionality, design and low prices. The FB business model leverages
a supplier network developed over the years to provide such premier brand goods as wristwatches andhandbags to specialty shops and discount electronics retailers on a stable basis and at lower prices thanthe competition. DOSHISHA has earned a reputation for premium quality from clients because it boasts
This Memo is for reference purposes only and is not intended as a solicitation for investment. The contents contained
herein are prepared based on reliable information that already exists in the public domain. The Company, however, does
not guarantee complete accuracy. Any opinion or information contained in the Memo is relevant as of the day of theInformation Meeting and/or Company Visit, although the views and/or facts may be altered without prior notification.
Final investment decisions shall be made by investors themselves based solely on their own judgment and responsibility.
Copyright © 2010 Trias CorporationAll rights reserved.

2a system that prevents the distribution of imitation products. The NB Processing model primarily offers
gift packages of the national brands produced by major makers that it assorts in-house, as well as
markets imported wines and food products. The sales growth rate of gift packages—which aretheme-oriented (summer and winter goods, for example) and consist of products made by different
national makers—is high due to the variation and low prices.
【FY03/10 Business Results Summary】
Consolidated sales for FY03/10 was ¥86.6 billion, an increase of 7.1% on a year-on-year basis.
Operating income was ¥7.7 billion, a 53.6% y/y gain. Net sales were below the target forecast as ofJanuary 2010, but profits were better than the forecast as a result of improved gross margins, mainly in
the PB business. [Trias Note: We believe a key determinant in the gross margin improvement has been
due to the strong yen, given that 70% of the Company’s purchases—which are dollar-based and withhalf bought in advance—are made abroad.] See Table 1 for net sales by business model. In the PB
business, sales of home appliances and products, as well as audiovisual products, including aroma
diffusers and mug bottles, performed well. For the FB business, while sales of wristwatches and otherluxury goods struggled in the first half, sales of low-price casual handbags and functional cosmetics
performed well. The NB Processing business also performed well, buoyed by a broader sales channel
for original gift packages, as well as by sales from prize-winning wines, a low-cost beer alternative,
sweet roasted chestnuts, Valentine chocolates and other goods. As a result of broadening its client base,the ratio of sales from new clients and from expanded retail floor space (such as setting up new food gift
corners in home centers) to total sales was 5.1%. Nonconsolidated sales from the top three channels are
as follows: ¥14 billion from general merchandising stores (or GMS, which recorded a y/y increase of13%); ¥12.2 billion from home centers (up 14% y/y); and ¥9.3 billion from volume discount retailers(a gain of 3% y/y). As for other channels, sales from drug stores leaped by 69%, while catalog sales alsosoared by 57%. In contrast, sales to specialty retailers such as shoes and import goods were hit by poor
first-half results, falling 22%. Sales to ¥100 shops also declined 7%.

Table 1: FY03/10 Net Sales by Business Model and Consolidated Earnings Summary（\Million）
Net SalesPBFBNBOthers & Affiliated Companies
Gross Profit
SG&AOperaitng IncomeOrdinary Income
Net Income

FY3/09Compositio
Actualn Ratio
80,898100.0%
35,72644.2%
22,94628.4%
18,611
23.0%
3,613
4.5%
19,64924.3%
14,635
18.1%
5,014
6.2%
5,131
6.3%
2,558
3.2%

FY3/10Composition
y/yActualRatio
Change86,629100.0%
7.1%
37,03642.8%
3.7%
24,31528.1%
6.0%
21,515
24.8%
15.6%
3,762
4.3%
4.1%
22,233
25.7%
13.2%
14,532
16.8%
-0.7%
7,701
8.9%
53.6%
7,593
8.8%
48.0%
4,293
5.0%
67.8%

This Memo is for reference purposes only and is not intended as a solicitation for investment. The contents contained
herein are prepared based on reliable information that already exists in the public domain. The Company, however, does
not guarantee complete accuracy. Any opinion or information contained in the Memo is relevant as of the day of theInformation Meeting and/or Company Visit, although the views and/or facts may be altered without prior notification.
Final investment decisions shall be made by investors themselves based solely on their own judgment and responsibility.
Copyright © 2010 Trias Corporation

All rights reserved.

3【FY03/11 Earnings Forecast】
The Company’s earnings forecast for FY03/11 is ¥91 billion in consolidated net sales, a y/y increase of
5.0%, and ¥8 billion in operating income, a gain of 3.9% y/y. Because the forecast is the sum ofconservatively based projections of each business model, DOSHISHA believes it will be relatively easy
to achieve. Given that the ratio of products developed in-house is growing in all three business model
lines, the Company has decided to revamp its previous segmentation of product lines and will, from thisfiscal year, categorize them whether they are “Internally developed” or for “Wholesale”, as well as a classtermed “Others”. In the future, DOSHISHA aims to capitalize on its manufacturing capabilities
by expanding its lineup of products developed in-house, and step up the marketing of these high-profit
original goods. For FY03/11, it projects sales growth of 6.9% from these internally developed goods. The
three newly launched DIVs, which specialize in wristwatch development, apparel for children and lighting
systems, are all development-type businesses. In terms of products, the Company is also expectinghigher sales from design-oriented humidifiers, mug bottles, low-cost LED lights and wristwatches andhandbags sold under its proprietary brand, Rubin Rosa—all of which have performed well since lastyear.

Table 2: Forecast of New Segment Net Sales and FY03/11 Consolidated Earnings

FY3/11 Forecast
FY3/10（\Million）
Actual1H
2H
Full YearNet sales
86,62941,80049,20091,000Internally developed
42,267
20,60024,60045,200Wholesale40,60019,40022,60042,000NB Processing
19,816
10,30010,60020,900
Famous Brand
20,785
9,100
12,00021,100
Others3,7621,800
2,000
3,800
Gross Profit
22,233
10,60012,70023,300
SG&A
14,5327,500
7,800
15,300Operating Income
7,701
3,100
4,900
8,000
Ordinary Income
7,593
3,100
4,900
8,000
Net Income
4,293
1,800
2,850
4,650
Note: FY03/11 forecasts announced at the business results meeting

y/y
5.0%
6.9%
3.4%
5.5%
1.5%
1.0%
4.8%
5.3%
3.9%
5.4%
8.3%

【Strategy Based on Point of Sales and Sales Approach】
Last year, sales from the Company’s channels to GMS and home centers were significantly higher—theresult of DOSHISHA focusing the primary thrust of its marketing effort on ten of its largest clients froma client base of 3,000 firms. For example, it began selling lifestyle goods and food gift packages to major
GMS outlets that had previously traded mostly in brand products. The Company believes the opportunity
to secure greater retail floor space is ripe for further growth beyond this fiscal year. It also plans to push
into foreign markets through its China subsidiary, as well as through distributor partnerships in China andSouth Korea.
This Memo is for reference purposes only and is not intended as a solicitation for investment. The contents contained
herein are prepared based on reliable information that already exists in the public domain. The Company, however, does
not guarantee complete accuracy. Any opinion or information contained in the Memo is relevant as of the day of theInformation Meeting and/or Company Visit, although the views and/or facts may be altered without prior notification.
Final investment decisions shall be made by investors themselves based solely on their own judgment and responsibility.
Copyright © 2010 Trias CorporationAll rights reserved.

4DOSHISHA is adopting a variety of marketing methodologies that exploit the special characteristics ofeach product. It is assigning importance to the way the high value added products the Company has
been focusing on recently are being sold. One example in which this has succeeded is thedesign-oriented humidifier, which it began selling in specialty stores such as Francfranc, thereby
enhancing consumer recognition while retaining its premium value. DOSHISHA believes that by carefully
making its products more recognizable, it can create new market opportunities. On the other hand,for products such as LED lights whose markets are expected to expand significantly in the future, it isresorting to a marketing strategy emphasizing low prices. Although its ROBRO Internet TV set isstruggling because the market remains small, if the alliance between Sony Corporation and Google, as
well as other companies, succeed in raising public recognition of such products, the Company believes
it stands to benefit from their success.
【Q&A Session at Business Results Meeting】
Q1: What is the sales forecast for LED lights in FY03/11? DOSHISHA has previously stated thatit would be more selective of the retailers it would supply.
A1: We will not be more selective. Insufficient production volume limited the Company to the type ofretailers it could supply in the previous fiscal year. For this fiscal year, it plans to aggressively market
the product without regard to retailer category.

Q2: Why did DOSHISHA’s sales to volume discounters slump last term?
A2: That was because those discounters that sell premier brands were struggling at the time.

(This concludes our summary of the Business Results and Follow-up Interview)

This Memo is for reference purposes only and is not intended as a solicitation for investment. The contents contained
herein are prepared based on reliable information that already exists in the public domain. The Company, however, does
not guarantee complete accuracy. Any opinion or information contained in the Memo is relevant as of the day of theInformation Meeting and/or Company Visit, although the views and/or facts may be altered without prior notification.
Final investment decisions shall be made by investors themselves based solely on their own judgment and responsibility.
Copyright © 2010 Trias CorporationAll rights reserved.

5【Reference】DOSHISHA CO., LTD. (Securities Code: 7483)
Key Financial Data and Business Results (Consolidated)
Key Financial Data (Consolidated)

Key Stock Indicators (Consolidated)
No. of Shares Issued
Mar. 2010
No. of Treasury Stock
Mar. 2010
Market Value (\million)
June 11, 2010
BPS (\)
Mar. 2010
ROE (%) ※1
Mar. 2010
ROA (%) ※2
Mar. 2010
PER (times）
FY3/10 est.
PCFR(times) ※3
Mar. 2010
PBR (times)
Mar. 2010
Share Price (\)
June 11, 2010
Unit Share (shares)June 11, 2010
Average Daily Volume (shares) ※4 June 11, 2010

18,687,818
537,966
38,3472,074.6
12.0
9.4
8.0
8.3
1.0
2,052
100
51,192

Consolidated
Operating
Net Sales
Income(\million）
FY3/0782,026
5,131
FY3/08
83,1405,144
FY3/0980,140
5,015
FY3/1080,8997,701
1H FY3/11 fcst.
41,8003,100
FY3/11 fcst.
91,0008,000

Total Assets (\million)
Mar. 2010
Shareholders' Equity (\million)
Mar. 2010
Interest-Bearing Debt (\million)
Mar. 2010
Equity Ratio (%)
Mar. 2010
Ratio of Interest-Bearing Debt (%) ※5 Mar. 2010
Free Cash Flows (\million) ※6Mar. 2010

48,74637,653
2,18878.3
5.8
5,157

※1 ROE=Current Net Income÷Averaged Shareholders' Equity
of beginning of term and term end※2 ROA=Current Net Income÷Averaged Total Assets
of beginning of term and term end※3 PCFR=Maket Value÷(Current Net Income+Depreciation)※4 Average Daily Volume=Average Daily Volume for the last 12 months※5 Ratio=Interest-Bearing Debts÷Shareholders' Equity※6 Free Cash Flows=Operating CF+Investment CF

Ordinary
Dividend
Net Income
EPS (\)
Incomeper Share (\)
5,338
3,298
170.7
45.00
5,183
2,849
154.4
45.00
5,131
2,558
140.9
45.00
7,594
4,293
236.5
55.00
3,1001,800
99.2
22.50
8,000
4,650
256.2
45.00
Note: FY3/11 forecast announced on May 7, 2010

Share Price Charts and RSI（Yen）
3,000

RSI300
Close share price
1 month moving average

2,500

250

3 month moving average
RSI [14 days]（Right）

2,000

200

1,500

150

1,000

100

500

70
50
30

1020

20

10/5/6/1
0/1
0/1
0
20

10

10/3/4/1
0/1
0
20

20

10/2/1
10/1
20
09

20/1

2//1
0

10

10
1/10
20
09

0//1

20
09

09
20

20

09/8/9/1
0/1
0/7
2009/609
20/100/1
00Source: Prepared by Trias Corp. with Bloomberg L.P. data.
Note: RSI, Relative Strength Index, is the index representing the ratio of overbought or oversold share prices.
In general, over 70 in RSI shows overbought share price range, while below 30 shows oversold share price range.
RSI=averaged share price appreciation for N days÷(averaged share price appreciation for N days +averaged share price decline for N days) x100

This Memo is for reference purposes only and is not intended as a solicitation for investment. The contents contained
herein are prepared based on reliable information that already exists in the public domain. The Company, however, does
not guarantee complete accuracy. Any opinion or information contained in the Memo is relevant as of the day of theInformation Meeting and/or Company Visit, although the views and/or facts may be altered without prior notification.
Final investment decisions shall be made by investors themselves based solely on their own judgment and responsibility.
Copyright © 2010 Trias Corporation

All rights reserved.