Results Briefing:1st Half (March to August2023)Results of 2024 Ending Feb.

16th October 2023
Security code：3608

AGENDA
1

Results Overview

2

About Business Situation by Channel

3

Brands Overview

4

Initiatives in each area of TIP25

5

Initiatives related to the SDGs

6

Full-year Forecast

7

Management conscious of capital costs and share prices

8

Reference Data

１

Results Overview

4Highlights of Results for 1st Half of Results of 2024 Ending Feb.

Net sales exceeded those for the previous year, but the sales plan was not achieved as the major brands and the overseas business struggled.
The operating income plan was not achieved, either, due to the effects of slow-moving inventories in some businesses which resulted from the failure
to achieve the sales plan.

Net Sales

73.27

Billion Yen

vs. Budget －1.72 billion yen
YoY Change +1.19 billion yen
YoY 101.7%➢➢➢

Operating Profit

Quarterly Net Income

0.53

1.47

Billion Yen

vs. Budget－0.46 billion yen

YoY Change－0.05 billion yen

YoY

90.4%

Billion Yen

vs. Budget +0.47 billion yen
YoY Change －0.77 billion yen
YoY 65.4%

Due to the effects of the previous year’s withdrawal from some businesses and American subsidiaries which continued to struggle, net sales
were ¥73.27 billion, 101.7% of the previous year’s level. Net sales continued to recover slowly, but there were still issues which remained to beaddressed.
Affected by the depreciation of the yen and sharp rises in the prices of raw materials as well as valuation losses due to growing inventories,
operating income was ¥530 million, ¥50 million lower than in the previous year.
Net income was ¥1.47 billion, ¥770 million lower than in the previous year, due to the effects of income taxes deferred.

5

Changes in financial results for the 1st Half of Results of 2024 Ending Feb

Gross Profit

40.84

Billion Yen

500
50.0
400
40.0

> Gross Profit

Gross Profit

UNIT:Billion yen

54.5%

53.6%

56.5%

55.7%

55.0%

300
30.0
200
20.0

YoY 100.3%

100
10.0

YoY Change +0.1 billion yen

0

60.0%

50.0%

43.9

43.0%

35.3

40.7

40.8

24.2

45.0%
40.0%

⇒ Gross profits continued to become better

35.0%

than in the average year due to careful sales
management but declined by 0.8% compared
to a year earlier.

2020 Ending 2021 Ending
2022 Ending
2023 Ending 24年2月期
2024 Ending
20年2月期21年2月期22年2月期23年2月期
Feb.
Feb.
Feb.

売上総利益
Gross Profit

Feb.

• Foreign exchange fluctuations and sharp risesin the prices of raw materials• Increase in price reductions due to growth inremaining inventories and increase invaluation loss

Feb.

売上総利益率Gross Profit Margin> SG&A Expenses
UNIT:Billion yen

SG&A Expenses

40.3

SG&A Expenses
61.6%

500
50.0

65.0%

400
40.0

55.7%

53.8%

Billion Yen

YoY 100.4%
YoY Change +0.16 billion yen

52.8%

300
30.0
200
20.0

44.1

55.0%

34.6

34.2

40.1

40.3

• Withdrawal from non-performing businesses• Achieving greater cost efficiency through theconcentration of head-office bases

60.0%⇒ The above two factors improved selling

55.0%

and administrative expenses by 0.7%
compared to the previous year when they
became better due to subsidies.

50.0%

100
10.0

45.0%

•

0

40.0%

•

2022 Ending
2023 Ending
2024 Ending
2020 Ending
2020 Ending
20年2月期21年2月期22年2月期23年2月期24年2月期
Feb.
Feb.
Feb.

Feb.

Feb.

SG&A
販管費
Expenses

販管費率
SG&A Expenses
Rate

Increase in logistic expenses due to growing
inventories
Effects of hikes in heat and lighting expenses⇒ The above two factors prevented selling
and administrative expenses from improving
more than expected.

6

Net Income Impact Items for 1st Half Results of 2024 Ending Feb.
Ordinary income, including non-operating income/loss such as dividend income and real estate revenue, was ¥1.6 billion.
Net income for the first half of the term, including ¥410 million in extraordinary income/loss such as gains on sale ofinvestment securities and impairment losses as well as income taxes deferred, was ¥1.47 billion, and the profit ratio was 2.0%.

・ Gain on sales of investment securities 0.5 billion yen

・Dividend income 0.69 billion yen
・FX income 0.18 billion yen
・Real estate income 0.17 billion yen

0.51

-0.1

billion yen

billion yen-0.54
billion yen

-0.11
1.18

・Impairment loss 0.08 billion yen
・Loss on valuation of investment
securities 0.01 billion yen

billion yen

billion yen

1.47
billion yen

・Interest expenses 0.02 billion yen
・Expenses on real estate 0.02 billion yen

Net profit margin
Ratio 2.0%

0.53 billion yen
Operating profit
margin 0.7%

OperatingincomeNon-operating
incomeNon-operating
expenses

Ordinary Income
1.6 Billion yen

Extraordinary
incomeExtraordinaryloss

Profit Before Taxes
2.01 Billion yen

Income taxes
deferred

Net income
attributable to ownersof parent

Net income
1.47 Billion yen

7

About Balance Sheet> Cash and Deposits
1ST Half 2023 Ending

Cumulative Q1ST

Feb.

2024 Ending Feb.

Results

Composition
Rate (%)

Composition

Results

Rate (%)

1ST Half 2024 Ending Feb.

Results

Composition

Y/Y

Rate (%)

ChangeY/Y (%)

Q2/Q1

Q2/Q1 (%)

Change【Comparison with the previous term】
Affected by increases in inventory assets and therepayment of borrowings totaling ¥5.4 billion, cash
and deposits decreased by ¥12.4 billion.

74,66154.1%

72,09653.0%

67,566

49.7%-7,09590.5%-4,53093.7%> Inventory(of Cash and Deposits)

37,06926.8%

28,49821.0%

24,66018.1%-12,409

66.5%-3,83886.5%(of which, Inventory)

21,78015.8%

27,26920.0%

27,792

20.4%

6,012

127.6%

523

101.9%

63,43445.9%

63,93047.0%

65,149

47.9%

1,715

102.7%

1,219

101.9%(of Investment Securities)

27,68420.0%

27,805

20.4%

27,79220.4%

108100.4%-13

100.0%(of Investment Real estate)

4,722

3.4%

4,701

3.5%

4,695

3.5%

-27

99.4%

-6

99.9%

138,095

100.0%

136,027100.0%

136,027100.0%-5,38098.5%-3,311100.0%【Comparison with the previous term】
Inventory assets were 127.6% of the previous
year’s level, or ¥6 billion higher than a year earlier,due to the bulk purchasing of products such as
those for long-term sales and sluggish sales ofspring and summer products in some businesses.

26,481

19.2%

27,665

20.3%

23,96318.1%-2,51890.5%-3,702

86.6%

121

0.1%

-

0.0%

-

0.0%

-121

0.0%

5,262

3.8%

4,553

3.3%

4,203

3.2%

-1,059

79.9%

-350

92.3%

12,475

9.0%

9,281

6.8%

9,444

7.1%

-3,03175.7%

163

101.8%

7,313

5.3%

4,175

3.1%

3,047

2.3%

-4,26641.7%-1,12873.0%

Total Liabilities

38,95728.2%

36,94627.2%

33,39925.2%-5,54985.7%-3,53990.4%

Total Net Assets

99,13871.8%

99,08072.8%

99,28074.8%

142100.1%

200

100.2%-4,759-3.4%-3,774-2.8%-4,537

-3.4%

222

95.3%

-763

120.2%

138,095

100.0%

136,027100.0%

132,679

100.0%-5,41696.1%-3,348

97.5%

Current Assets

Non-current Assets

Total Assets
Current Liabilities(of Short-term borrowings)(of Current portion of long-term borrowings)

Non-current Liabilities(of Long-term borrowings)(of Treasury stock(-))
Total Liabilities and Net Assets- #DIV/0!

> Treasury stock【Comparison with the previous term】
As part of its efforts to implement capital policy andtake measures for shareholder returns, thecompany continued to acquire treasury stock. The
value of the treasury stock increased by ¥760
million.
Starting from October 16, the Company plans toacquire new treasury stock worth ¥5 billion.

２

About Business Situation by Channel

Sale Trends by Channel for 1st Half Results of 2024 Ending Feb.

9

Cumulative net sales continued to grow, but while some channels performed well, others did not. We will strove to secure profits
while balancing between aggressive and defensive sales.

••

Department stores and non-department stores (FB and street): Sales made rapid progress mainly among street brands thanks to growth in the
traffic of people and the recovery of inbound tourism. They were 103.4% of the previous year’s level though the number of outlets decreased by 41compared to a year earlier.
Domestic EC: The withdrawal of some brands and price reductions restrained by other companies’ EC sites, etc. affected sales, causing them toremain at 93.5% of the previous year’s level though profitability improved.
Overseas sales: Overseas wholesaling and European sales were strong, but because of backlash against sales in the anniversary year of
America’s HUF and decline in demand on the consumer side due to rapid inflation, the overall overseas sales stagnated, and these were thereason they remained at 93.6% of the previous year’s level.

Domestic•

Department
StoresCommercial
Facilities(*1)
E-Commerce

Domestic Others(*2)
Overseas

New profit standards

Old profit standards

New profit standards

Cumulative Q2ND
2022 Ending Feb.

Cumulative Q2ND
2023 Ending Feb.

Cumulative Q2ND
2024 Ending Feb.

YoY (%)

6.31 Billion Yen

9.56 Billion Yen

9.40 Billion Yen

98.3％(Composition Rate：9.8%)(Composition Rate ：13.3%)(Composition Rate ：12.8%)

27.35 Billion Yen

31.37 Billion Yen

32.93 Billion Yen(Composition Rate ：42.3%)(Composition Rate ：43.5%)(Composition Rate ：44.9%)

18.78 Billion Yen

17.82 Billion Yen

16.66 Billion Yen(Domestic E-Commerce ratio ：35.8%)(Domestic E-Commerce ratio ：30.3%)（ Domestic E-Commerce ratio ：28.2%）

7.43 Billion Yen

7.18(Composition Rate ：11.5%)

Billion Yen(Composition Rate ：10.0%)

4.85 Billion Yen

6.13 Billion Yen(Composition Rate ：7.5%)(Composition Rate ：8.5%)

93.5％

8.54

118.9%

5.73

93.6%

Billion Yen(Composition Rate ：11.7%)
Billion Yen(Composition Rate ：7.8%)*1 Fashion buildings, shopping centers, railroad station buildings, individual stores, outlet shops etc. except for department stores.
*2 Apparel businesses such as wholesale, intercompany sales and non-apparel businesses of the group companies.

105.0％

10

E-commerce in 1st Half Results of 2024 Ending Feb.
EC sales for the first half of the term were ¥18.45 billion, or 93.4% of the previous year’s level. They remainedsluggish partly because of the effects of withdrawal of some businesses*1.
As consumer confidence declined due to rises in the prices of products and customers flowed to real stores, the Company failed to increase EC
sales because there were issues to be addressed in expanding inventories of high-turnover products and creating new information content.
Plans call for the Company to take company-wide EC measures for future growth. By creating new marketing topics, the Company will strive toacquire new customers, thus maximizing EC sales.
Old profit
standards

Unit : Billion Yen

New profit standards

Proposed plan: Yes, let’s go to festivals!

Cumulative Q2ND
2022 Ending Feb.

Cumulative Q2ND
2023 Ending Feb.

Cumulative Q2ND
2024 Ending Feb.

Compared to year
before last (%)

In-House E-Commerce

8.99

8.73

7.84

87.2%

89.8%

(ratio(%))(47.9%)(49.0%)(47.1%)(-0.8pt)(-1.9pt)

Domestic E-Commerce

18.78

17.82

16.66

88.7%

93.5%

(ratio(%))*(35.8%)(30.3%)(28.2%)(-7.6pt)(-2.1pt)

1.6

1.94

1.79

111.9%

92.3%(33.0%)(31.7%)(31.3%)(-1.7pt)(-0.4pt)

Overseas E-Commerce(ratio(%))*

Y/Y(%)

E-Commerce TOTAL

20.38

19.77

18.45

90.5%

93.4%

(ratio(%))*(35.6%)(30.5%)(28.5%)(-7.1pt)(-2.0pt)*1 The amount of EC sales shrank due to the effects of withdrawal from the ”BOSCH” business and the termination of agency contracts for“SUNSPEL” and “UNDEFEATED” (¥1.05 billion)*2 Domestic E‐Commerce ratio excluding domestic and other sales (wholesale, company sales, etc.)

The Company made proposals for fashion coordinatesacross the boundaries of brands on its own EC site
“MIX.Tokyo.” By continuing to make total TSI brandproposals, it will raise the overall recognition level for its
brands and acquire new fans of TSI brands.

３

Brands Overview

12

Individual Overview of Major Brands in 1st Half Results of 2024 Ending Feb.

Net sales for eight of the top ten brands in terms of sales exceeded those for the previous year. Among thosebrands, “MARGARET HOWELL”, “AVIREX”, and “STUSSY” continued to perform well as in the previous year,
achieving two-digit growth.
In general, brands other than the major ones also performed well though they struggled in some channels. In
particular, the ladies apparel business (such as “LE PHIL” and “ADORE”) and the street business (such as “BAIT” and“BEAVER”) made rapid progress in sales.
Unit:Million Yen■ Top 10 brands in sales

1ST Half 2023 Ending Feb.

Sales

Composition
Rate (%)

1ST Half 2024 Ending Feb.

Sales

YoY

Composition
Rate (%)

Sales (%)

1.

PEARLY GATES

8,369

11.6

7,941

10.8

94.9

2.

MARGARET HOWELL

5,978

8.3

6,705

9.2

112.2

3.

NANO universe

6,165

8.6

6,251

8.5

101.4

4.

NATURAL BEAUTY BASIC

5,377

7.5

5,594

7.6

104.0

5.

HUF

4,686

6.5

4,066

5.5

86.8

6.

AVIREX

2,805

3.9

3,321

4.5

118.4

7.

STUSSY

2,039

2.8

2,481

3.4

121.6

8.

new balance golf

2,196

3.0

2,429

3.3

110.6

9.

human woman

2,131

3.0

2,203

3.0

103.4

10.

Jack Bunny!!

1,630

2.3

1,647

2.2

101.0

41,38057.4

42,642

58.2

103.0

TOP10

・PEARLY GATESYoY：94.9%

Sales continued to far exceed those of the pre-COVID level but
Growth is slowing down. We will strove to secure sales and profits
while selling inventories.

・MARGARET HOWELL

YoY：112.2%

Both real stores and EC sites increased sales. “MHL.” saw casuallines planned in Japan perform well with their EC sales achieving
substantial growth, at 137.9% of the previous year’s level.

・NANO universe YoY：101.4％
Sales from real stores recovered. EC sales fell due to restrained
excessive price reductions, but EC profitability improved.
The brand will continue to use appropriate sales strategy for sales
growth while maintaining profitability.

・HUF

YoY：86.8％

Domestic sales continued to be strong, but overseas sales struggled
due to the backlash against sales from the previous year’s 20th
anniversary project as well as sharp price rises and changes in the
post-COVID market environment. The brand aims for recovery by
developing new categories of products.

４

Initiatives in each area of TIP25

14

TSI Holdings Group’s medium-term management plan “TIP25”
Announced on April 14, 2022 Medium-term management plan materials reposted

H e n c e , t o l e a p t o w a r d 2 0 2 5 , w e h a ve u p d a t e d T I P 2 4 ,t o t u r n i t i n t o t h e T S I I n n o va t i o n P r o g r a m 2 0 2 5 ( T I P 2 5 ) .

TIP25 formulation policy

1

2

3

Align the direction of
Capture changes in thesocial environment andmarket to express andembody our existence
and purposethe entire company withthe direction ofbusiness domains todevelop business in
new growth domains

Achieve sufficiency indigital engagement,
ESGs and high profit,
all areas that the stock
market holds dear

15

TIP25 4Div.(domains)
Announced on April 14, 2022 Medium-term management plan materials reposted

1

Wellness & LifestyleWellness & lifestyle

AthleisureOutdoor

L i fe s t y l eCreate fashionentertainmentthat has a positiveon the healthand happinessof consumers and,extension,

impactStreet & culture

StreetCultureSelectbysociety.

Fashion Capital3

Nurture street culture andcreate fashionentertainment that brings
positivity to society andDigital Generation

Digital generation

values of brands andGen-Z
Fa s h i o ncreate fashion

D2C/F2C

entertainment centered on

DigitalFa s h i o n

Refine the experiencehighly refined tastes.

2

the environment.

Fashion capital

L a d y ’s
Fa s h i o nStreet & Culture

Create fashionentertainment for thedigital native generation
via digital x fashion.

4

16

TIP25 4Div.(ドメイン) / ブランド配置図

1

Wellness & LifestyleWellness & Lifestyle Div.
1.
2.
3.
4.
5.
6.
7.
8.
9.

PEARLY GATESPGGMASTER BUNNY EDITIONJack Bunny!!
St ANDREWS
PING
new balance golf
NBB WEEKENDMARGARET HOWELL

Street & Culture Div.
10.
11.
12.
13.
14.
15.
16.
17.
18.

MHL.
Dice&Dice
SEVEN BY SEVEN
quitanand wanderYLÈVE
THE LIBRARY
LalineUrth Caffé

Fashion Capital Div.
Apuweiser-riche
JUSGLITTY
Rirandture
Mystrada
CADUNÉ
Arpege story
NATURAL BEAUTY BASIC

1.
2.
3.
4.
5.
6.
7.
8.

3

Fashion Capital

1.
2.
3.
4.
5.
6.
7.

2

Street & CultureSTÜSSY
HUF
UNION
BAIT
FIGURE
Forget-me-nots
AVIREX
SchottDigital Generation
Digital Generation Div.

8.
9.
10.
11.
12.
13.

N.
PROPORTION BODY
DRESSING
ADORE
human woman
LE PHILPINKY&DIANNE

1.
2.
3.
4.
6.
7.
8.
9.
10.

ETRÉ TOKYOMECRE
CHAROL
FREE’S MARTJILL STUARTJILL by JILL STUARTROSE BUD
hueLe Museum
STUMBLY

9.
10.
11.
12.
13.
14.
15.
16.

B’2nd
BEAVERLHP
ROYAL FLASHGARDEN (吾亦紅)MANASTASH
Resew
NANO universe

4

17

Wellness & LifestyleCreating attractive communities¥23,679 million

Sublimating apparel brands into community brands.

32.8%
N e t s a l e s Yo Y c h a n g e

Developing entertainment business closely linked to lifestyles.

Popular golf brands gather at the newly established press room
A new press room that focused ongolf brands opened. Each of TSI’snine golf brands had its own
exclusive booth with their diverse
attractions condensed in a single
space.
Previously, the Company hadorganized exhibitions and carriedout Think Golf and other initiatives
with sustainability in mind, but thisproject featured a press room that,while introducing such elements,
made the parties concerned feel likevisiting it in spite of themselves.

¥23.67

104.2

Billion

％

Ratio
売上高to
total sales
構成比“SEVEN BY SEVEN”First time participating in a runway show

The brand presented its 2024 SScollection at the Rakuten Fashion Week
TOKYO, one of the five major fashion
weeks. The runway show held at the
National Stadium livened up as many
visitors attended it.

▲ Sofa that used B
products and sample
wear

Furthermore, in October, the brand’s
flagship store opened in Yoyogiuehara.
This outlet will sell old clothes purchasedby designers themselves, selected special
items, and other products and implement
projects it works out on its own.

18

Street & Culture

Platform for play rooted in the street spirit¥25,652 million
By extending to the keyword “play,” the platform aims at
spreading itself to neighboring lifestyles, reinventing gears,

Net sales

Yo Y c h a n g e

and offering new experiences.

¥25.65

100.2

Billion

％

35.6%
Ratio
to
売上高
total
sales
構成比

“HUF” hosts its first NFT event“Forget-me-nots’ ” project to support women“HUF” held the HUF SET NFT, the TSI Group’s
first NFT project.
This was the event that allowed only holders of
NFT cards, which were distributed when theypurchased products covered by the project, toparticipate in it. In this first project, among
other features, HUF ambassador REMIO wasinvited as the main guest, live paint eventswere held, and limited products were sold.

In July, “Forget-me-nots” whose sales were strong,at 171.8% of the previous year’s level, launched
the project “Hello, World!” to support young female
artists. The event offered the store space tofemale artists aged 35 or younger free of charge, a
new trial to assist them mainly in organizing an
exhibition of their works.

By introducing new technology actively, thebrand aims at creating new types of fashionentertainment.

▲ In addition to real
works, those which used
AR were presented.

▲ Many fans visited theevent site.

The brand will work to empower women according
to the phases of their career by not only providing
the store space but also offering diverse
opportunities to express themselves, including
collaborative projects and content production.

▲ At the launch party, thefirst pop-up store was held.

19

Fashion CapitalServices that respond constantly to market trends and changes¥17,023 million

Being flexible enough to continue changing gracefully, granting
the wishes of customers, and extending a circle of happiness.

Net sales

YoY change¥17.02

103.9

Billion

％

23.6%
Ratio
to
売上高
total
sales
構成比

“Arpege”, a new business type whose strength is to communicate
information and offer experience value

Collaboration among different industries within“human woman”

A new format, Arpege Salone opened at Shinjuku Marui. This is amulti-function store that offers a full array of Arpege brands and has
a studio. In addition to livestreaming, it functions as a place to holdvarious events.

“human woman”, which celebrates the25th anniversary this year and is
implementing a wide range of projects,
offered collaborative items with “Urth
Caffé”, a restaurant business.

Arpege Salone will play not only an existing role as an outlet for
selling clothes but a new role as a place to communicate informationand offer experience value.

▲ Many customers visited the store for the opening event.

One example of collaboration was touse usually discarded coffee grounds
for dyeing to produce items that had anatural color.

Livestreaming from 12:00
p.m. each day

Part of the sales was directed
to environmental protection
projects.

×20

Digital Generation

Continuously expanding content to win over the next generation ofcustomers
Obtaining a favorable response and generating strong excitement
through tangible and intangible content that expands infinitely.

hueLe Museum’s exhibition combines fashion and art
Under the concept “Immersive Art Museum–
Dive into art,” huele Museum’s 2023 FW
exhibition invited guests from the general public for
the first time and had them enjoy the Fashion x
Flower x Art experience the brand emphasized.
As exemplified by the display of digital content andworks of art as well as clothing, the event had
programs that deserved to be called a “museum.”
The brand will continue to offer its unique
attractions by combining fashion with art.

¥5,744 million

8.0%
Net sales

YoY change

¥5.74

96.3

Billion

％

Ratio
売上高to
total
sales
構成比

JILL by JILL STUART’s Popular products are reprinted“JILL by JILL STUART”, which celebrated its 15th anniversary in Augustof this year, launched the COME BACK PROJECT to express its
appreciation to customers. Under the theme “Continuing to offer thoselovely items in the future,” the brand will sell popular products from its
archives for a limited period of time.
“JILL by JILL STUART” will
create products full of its
attractions while maintaining
its history carefully so that thebrand will be long loved in theyears to come.
▲ A total of ten items are planned to berevived.

５

Initiatives related to the SDGs

22

SDGs

Acquiring SBTi certification for GHG emissions reduction targets
SBT Initiative (SBTi) certified TSI Holdings’ greenhouse gas (GHG) emissions reduction targets as those based on thescientific grounds established by the Paris Agreement.
In accordance with the purpose “Using the power of fashion entertainment, we create empathy and social value around theworld,” the Company will continue to push forward with initiatives to realize a sustainable society and step up efforts todisclose relevant information according to the framework of TCFD.
As mentioned in the press release of October 12, 2022 “Announcement of support for TCFD
recommendations and submission of commitment letter to SBT initiative,” the Company
submitted its commitment letter to the SBT initiative and announce its GHG emissions
reduction targets.

CO2 emissions and reduction targets

Science Based Targets (SBTs)
SBTs refer to greenhouse gas emissions reduction targets conforming to thelevels of reduction targets required by the Paris Agreement which are set bybusinesses with five to ten years ahead as their target years.
Science Based Targets initiative (SBTi)
The SBTi was established in 2015 jointly by four organizations: CDP, the United
Nations Global Compact, the World Resources Institute (WRI), and the World
Wildlife Fund (WWF).
In order to help achieve the targets established by the Paris Agreement, it ispromoting businesses’ efforts to set GHG emissions reduction targets based on
scientific grounds.

Scope 1/2

Scope 3Results for the term
ended February
2020

Reduction targets
for the term ending
February 2030

Level of reduction
targets set by SBTi

9,000 t-48%(-4,000 t)

1.5℃ target
4.2% reduction
each year

295,000 t-35%(-103,000 t)

WB2℃ target
2.5% reduction
each year* The Scope 1 and 2 reduction targets aim at achieving a level of reductions that keeps a temperature rise below 1.5℃.
The Scope 3 reduction targets aims at achieving a level of reductions that keeps a temperature rise well below 2.0℃, alevel of reductions equivalent to those for achieving the carbon neutrality in 2050. Emissions are indicated by discarding
fractions less than 1,000 tons.

23

SDGs

Making progress in sustainable innovation
In order to achieve its GHG emissions reduction targets, the Company is carrying out a wide variety of initiatives such as
promoting business models with less environmental impacts and educating employees. It will strive to create sustainable
innovation by conducting various activities on a continuous basis.

Organic cotton development
project

Making effective use ofrecycled, environmentallyconscious materials

In a joint project with SynCom Agritech, anagricultural venture, the Company completed forthe first time the spinning of yarn from cottongrown in the Indian state of Tamil Nadu on a trial
basis.

With the cooperation of Seni-Ikueikai, the Company
is collecting used clothes at its stores and developing
new products using recycled materials made fromsuch collected clothes for the part of the products.

The use of this cotton for product development
under TSI’s brands is under way.

The T shirts recently developed based on unisex
specifications can be worn irrespective of gender.

Educating employees in sustainability
through internal exhibitions
The Company expanded the scope of exhibits related tosustainable manufacturing at the Quality Information
Exhibition it held to ensure that information on quality
was shared internally.
By providing opportunities for even employees who
were usually less interested in the environment andhuman rights to think about them again, the Company
urged each and every one of them to deepen theirknowledge of these subjects.

24

SDGs

Initiative for sustainable community development with
Hokkaido’s Kamikawa Town

Since it entered into a comprehensive community agreement in October 2021, the Company has carried out community
development initiatives on a continuous basis.
The town government and TSI are promoting co-creation with the aim of creating new attractions for Kamikawa Town and developing
more people connected with the town.

上川町
HOKKAIDO KAMIKAWA

Daisetsu Wildlife Encyclopedia Project 2023

Ishikari River clean-up campaign
In order to help protect the natural environment,
TSI employees took part in the Ishikari Riverclean-up campaign on which the town
government was working.
The Company contributed to realizing asustainable town that pays attention to thecircular flow of economy, natural settings, andbiological diversity.

TSI Holdings is supporting the Daisetsu Wildlife
Encyclopedia Project, a demonstrative experimentthat aims at promoting tourism in Kamikawa Town,
coexisting with the natural environment of Mt.
Daisetsu, and protecting its biological diversity.
“MANASTASH”, operated by a TSI Group company,
produced and provided T shirts.

Corporate version of hometown
tax donation program
For Kamikawa Town’s SDGs project to protect
the natural environment and biological diversityof the Daisetsuzan National Park, theCompany donated taxes under the regional
revitalization support tax system.

６

Full-year Forecast

26

Plan for the entire term
At present, the operating income and net income plans for theentire term are not changed.
During the first half of the term, the Company was forced to struggle with its operating income ¥470
million less than initially planned, but by taking the measures listed below during the second half, itaims at bringing results as previously projected.

Improvement
measure01

Priority investments in promising businesses

Operating income planfor the entire term

¥4.7 billion
Improvement
measure02

Expanding sales by strengthening EC

Improvement
measure03

Keeping remaining inventory levels for autumn andwinter merchandise low

Improvement
measure04

Controlling selling and administrative expenses
appropriately

Net income plan for theentire term

¥3.5 billion

27

Shareholder returns
The acquisition of treasury stocks, which had been done since January 2023, was completed in September. The 3,069,100 shares thus
acquired are planned to be written off at the end of October. TSI Holdings has announced that it will acquire additional treasury stocks aspart of its capital policy as it aims at stepping up its efforts to return profits to shareholders and improving capital efficiency.
Amount of shares that can beacquired¥5,000 million

Period of acquisition

October 16, 2023 to March 29, 2024

6,677

Unit : Million Yen
4,985
4,236

(Planned acquisition
amount)

4,008

5,000

3,382

2,321
1,334

777
2016
Ending2016.2期
Feb.

2017
Ending2017.2期
Feb.

2018
Ending2018.2期
Feb.

2019
Ending2019.2期
Feb.

2020
Ending2020.2期
Feb.

2021
Ending2021.2期
Feb.

1,677(*1)
2022
Ending2022.2期
Feb.

2023
Ending2023.2期
Feb.

2024
Ending2024.2期
Feb.

自己株式取得額■ Amountof treasury stock acquired*1 The shares worth ¥322 million are included in those for the term ended February 2023 because they were acquired in January and February 2023.

７Management conscious of capital costs and share prices

29

Understanding of the present condition (1)(Analysis of PBR and comparison with other companies in the industry)TSI Holdings goes below the average in the valuation of PBR and ROE.

The issue to be addressed is ROE
Marketcapitalization

PBR

Net assets= ROE

Net income
Net assets

× PER

Market capitalization
Net income

PBR: Comparison with othercompanies in the industry

ROE: Comparison with othercompanies in the industry

PER: Comparison with othercompanies in the industry

ＴＳＩ
TSI

0.6

ＴＳＩ
TSI

ＴＳＩ
TSI

A社A
Company

0.9

A社A
Company

B社B
Company

0.9

B社B
Company

C社C
Company
D社D
Company

2.2

13.5%

E社E
Company

F社F
Company

1.5

F社F
Company

繊維製品中央値
Textileproduct median

繊維製品中央値
Textileproduct median

0.6
0.0

0.5

1.0

14.3%

繊維製品平均Textile productaverage

0.9

1.5

2.0

All figures for TSI are as of October 3, 2024.

2.5

0.0%

8.2%

9.5

Company
D社D

15.8

Company
E社E

12.0

Company
F社F

10.8

Textile productaverage
繊維製品平均10.8

Textileproduct median
繊維製品中央値

4.3%
4.0%

16.5

Company
C社C

6.8%
14.0%

1.6

42.6

Company
B社B

5.7%

D社D
Company

E社E
Company

18.2

Company
A社A

2.1%

C社C
Company

0.6

繊維製品平均Textile productaverage

3.6%

8.0%

12.0%

16.0%

0.0

14.1
10.0

20.0

30.0

40.0

50.0

30

Understanding of the present condition (2)(Changes in and the current status of TSI’s ROE and PBR)

Since ROE was low compared to the level of shareholder’s equity cost TSI recognized, PBR has continued to be 1.0 or less.
As indicated in the comparison on the previous page “Understanding of the present condition (1),” the average of ROE for the
textile industry is 8%, and in terms of PBR, the average is nearly 1.0.
TSI will strive to increase PBR to 1.0 by reducing the cost of shareholder’s equity to a lower level than the current one,achieving an ROE that exceeds the cost of shareholder’s equity, and expanding equity spreads.

Changes in TSI’s PBR

Changes in TSI’s ROE and the current capital cost (range)
1.2

9.0%
8.0%

7.0%
6.0%

Estimated cost of shareholder’s equity:
5.4%–7.8%*(On a PER basis/CAPM basis)

5.0%

4.0%

4.0%

0.4

2.2%

2.0%
1.0%

3.1%
2.9%

1.9%

0.8

0.6

3.2%

3.0%

1.0

0.2

1.0%
1.2%

0.0%

1.1%
0.0
・・・・・・* Calculated by financial institutions

Capital cost range
資本コストレンジ
ROE

PBR

31

Understanding of the present condition (3)TSI aims at improving ROE by improving profitability, stepping up its efforts to return profits to shareholders, and cutting down
on non-business assets to achieve greater asset efficiency.

PBR
0.61

ROE
3.5%
Forecast for the term
ending February 2024

Net income
ratio

2.2%
Forecast for the term
ending February 2024
Financial leverage

Share price

1.34

¥725

Net assets¥99,306 million
as of the end of
August 2023

as of the end of
August 2023

Net assets per
share¥1,205.38
as of the end of August
2023

PER
17.2
Forecast for the term
ending February 2024

Improve theprofit ratio

Step up efforts
to return profits
to shareholders
Cut down on
non-businessassetsBusiness growthpotential

32

Targets of indicators
Based on the foregoing, TSI has set targets of indicators.
The Company is considering measures to achieve targets set for these indicators from various aspects:
business processes, financial capital, and non-financial information.
It plans to disclose specific measures in April 2024.

Targets of indicators

Operating income ratio: 5.0% or more

ROE: 8.0% or more

PBR: 1.0 or more

Nurture worldwide empathy and social value through thepower of fashion entertainment.

A company creating fashion entertainment８Reference Data

35

Highlights of Q2ND Results of 2024 Ending Feb.
Unit:Million Yen

Overview(Revenue recognition standards)

Q2ND 2023 Ending

Q2ND 2024 Ending Feb.

Feb.
Composition

Results

Rate (%)

Results

Composition

Y/Y

Rate (%)

ChangeY/Y (%)Net Sales

33,965+100.033,905+100.0-60

99.8

Gross Profit

18,387+54.1

18,278

+53.9

-108

99.4

SG&A Expenses

19,401+57.1

19,582

+57.8

180

100.9

SG&A Expenses(excl. Goodwill Amortization, Depreciation
18,432 and+54.3
Amortization)
18,639

+55.0

207

101.1

Goodwill Amortization

119

+0.4

124

+0.4

4

103.6

Depreciation and Amortization

848

+2.5

818

+2.4

-30

96.4

Operating Income-1,014-3.0-1,303

-3.8

-289

128.5

Ordinary Income

-319

-0.9

-816

-2.4

-497

255.4

Extraordinary Income

703

+2.1

319

+0.9

-383

45.4

Extraordinary Loss

84

+0.2

56

+0.2

-28

66.7

Profit Before Taxes

298

+0.9

-553

-1.6

-852

-185.3

Profit Attributable to Owners of Parent

186

+0.5

-516

-1.5

-702

-277.5

EBITDA ※

-45

-0.1

-360

-1.1

-315

791.3

*EBITDA＝Operating Income + Goodwill Amortization + Depreciation and Amortization

36

Highlights of 1st Half Results for FY Ending Feb. 2024
Unit:Million Yen

Overview

1ST Half 2023 Ending

1ST Half 2024 Ending Feb.

Feb.

(Revenue recognition standards)
Results

Composition
Rate (%)

Results

Composition

Y/Y

Rate (%)

ChangeY/Y (%)Net Sales

72,087100.0

73,278

100.0

1,190

101.7

Gross Profit

40,73556.5

40,841

55.7

106

100.3

SG&A Expenses

40,14655.7

40,308

55.0

162

100.4

SG&A Expenses(excl. Goodwill Amortization, Depreciation
37,925 and52.6
Amortization)
38,528

52.6

603

101.6

Goodwill Amortization

217

0.3

230

0.3

12

105.9

2,003

2.8

1,549

2.1

-453

77.3

Operating Income

588

0.8

532

0.7

-56

90.4

Ordinary Income

1,892

2.6

1,608

2.2

-283

85.0

Extraordinary Income

873

1.2

511

0.7

-362

58.5

Extraordinary Loss

248

0.3

103

0.1

-144

41.7

Profit Before Taxes

2,517

3.5

2,016

2.8

-501

80.1

Profit Attributable to Owners of Parent

2,249

3.1

1,472

2.0

-777

65.4

EBITDA ※

2,810

3.9

2,312

3.2

-497

82.3

Depreciation and Amortization*EBITDA＝Operating Income + Goodwill Amortization + Depreciation and Amortization

37

Highlights of 1st Half Results for FY Ending Feb. 2024
Unit:Million Yen

Net Sales
Per Channel(Revenue recognition standards)

1ST Half 2023 Ending

1ST Half 2024 Ending Feb.

Feb.
Results

Composition

Results

Composition(Million yen)

Rate (%)(Million yen)

Rate (%)

Y/Y (%)

Comp os it ion Rat e
Y/Y Ch an ge(p t )Department Stores

9,565

13.3

9,400

12.8

98.3

-0.4ptCommercial Facilities(*1)

31,37543.5

32,933

44.9

105.0

+1.4ptIn-house EC

8,731

12.1

7,845

10.7

89.8

-1.4pt

3rd Party

9,096

12.6

8,818

12.0

96.9

-0.6ptEC(E-Commerce)

17,828

24.7

16,66322.7

93.5-2.0ptOthers(*2)

7,185

10.0

8,543

11.7

118.9

+1.7ptDomestic

65,95591.5

67,541

92.2

102.4

+0.7ptEC(E-Commerce)

1,942

2.7

1,793

2.4

92.3

-0.2ptOverseas

6,132

8.5

5,736

7.8

93.6

-0.7ptEC(E-Commerce)

19,771

27.4

18,45725.2

93.4-2.2ptTOTAL

72,087100.0

73,278

100.0

101.7

-

*1 Fashion buildings, shopping centers, railroad station buildings, individual stores, outlet shops etc. except for department stores.
*2 Apparel businesses such as wholesale, intercompany sales and non-apparel businesses of the group companies.

38

Highlights of 1st Half Results for FY Ending Feb. 2024
Unit:Million Yen

Brands Overview(Revenue recognition standards)

1ST Half 2023 Ending Feb.
Sales

Composition

Gross Profit

Rate (%)

Ratio (%)

1ST Half 2024 Ending Feb.
Sales

Composition

Gross Profit

Rate (%)

Ratio (%)

YoY
Sales (%)

Gross Profit
Ratio (pt)1.

PEARLY GATES

8,369

11.6

63.3

7,941

10.8

58.4

94.9

-4.9pt2.

MARGARET HOWELL

5,978

8.3

65.3

6,705

9.2

66.0

112.2

+0.8pt3.

NANO universe

6,165

8.6

52.1

6,251

8.5

52.7

101.4

+0.7pt4.

NATURAL BEAUTY BASIC

5,377

7.5

63.0

5,594

7.6

64.1

104.0

+1.1pt

5.

HUF

4,686

6.5

51.1

4,066

5.5

52.9

86.8

+1.9pt6.

AVIREX

2,805

3.9

65.3

3,321

4.5

58.3

118.4

-7.0pt

7.

STUSSY

2,039

2.8

65.6

2,481

3.4

64.8

121.6

-0.8pt8.

new balance golf

2,196

3.0

51.7

2,429

3.3

48.2

110.6

-3.6pt9.

human woman

2,131

3.0

65.0

2,203

3.0

65.9

103.4

+0.9pt10.

Jack Bunny!!

1,630

2.3

47.1

1,647

2.2

47.0

101.0

-0.1ptTOP10

41,38057.4

59.4

42,642

58.2

58.7

103.0

-0.8ptOther Brands

30,06141.7

52.7

30,619

41.8

51.8

101.9

-0.9ptContinuing Brands

71,442

99.1

56.6

73,262

100.0

55.8

102.5

-0.8pt

645

0.9

49.5

16

0.0

89.9

2.5

+40.4pt

72,087

100.0

56.5

73,278

100.0

55.8

101.7

-0.7ptClosed Brands
TOTAL

39

Highlights of 1st Half Results for FY Ending Feb. 2024

Domestic Monthly Sales Information
1St Half 2023 Ending Feb.
All Stores：102.6％
Existing Stores：102.8％

1St Half 2024 Ending Feb.
All Stores：102.3％
Existing Stores：106.5％

40

Highlights of 1st Half Results for FY Ending Feb. 2024

The Number of StoresAppa re l

1ST Half 2023

FY En d in g

Store

Store

1ST Half 2024

Y/Y

Q 2/Q 4

En d in g Feb .

Feb . 2023

Open

Close

En d in g Feb .

Ch an ge

Ch an ge

Do me stic

774

738

+32

-37

733

-41

-5

Ove rse a s

40

29

+1

-

30

-10

1

Total

814

767

+33

-37

763

-51

-4

Res t aurant

Do me stic

8

8

-

-

8

0

0

C os met ic s

Do me stic

36

36

+1

-2

35

-1

-1

858

811

+34

-39

806

-52

-5

Total

・Descriptions about future within this document are based on the information that the company obtains on the date of this report andcertain assumptions deemed to be reasonable. Actual earnings may differ materially from various future factors.
・This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between thistranslated document and the Japanese original, the original shall prevail.