Business Results for the Fiscal Year Ended February 28, 2022
[Japanese GAAP] (Consolidated)
April 13, 2022
Company name:

TSI HOLDINGS CO., LTD.

Stock listing: Tokyo Stock Exchange

Code number:

3608

URL: https://www.tsi-holdings.com/en/

Representative:

Representative Director and President, Tsuyoshi Shimoji
Executive Officer, General Manager of Finance & Accounting Dept. Mitsuru Naito
TEL: +81-3-6748-0001

Contact:

Scheduled date of financial report:
Scheduled date to begin dividend payment:

May 27, 2022
May 27, 2022

Preparation of supplementary financial document:
Briefing session to explain the financial statements:

Yes
Yes (For institutional investors and analysts)(Rounded down to the nearest million yen)

1. Consolidated Business Results for the Fiscal Year Ended February 28, 2022 (March 1, 2021 to February 28, 2022)(1) Consolidated results of operations(% change from the previous fiscal year)

Net sales

FY ended February 2022
FY ended February 2021

Operating income

Million yen
140,382
134,078%
4.7(21.2)

Million yen
4,440(11,843)%――(Notes) Comprehensive income: Fiscal year ended February 28, 2022
Fiscal year ended February 28, 2021
Net income
per share

Million yen
5,834(10,359)%――

Million yen
1,022
3,861

%
(73.5)
77.0¥181 million (96.1%)¥4,636 million―%

Diluted net
income per share

Yen
11.32
42.64

FY ended February 2022
FY ended February 2021

Profit attributable toowners of parent

Ordinary income

Return on
equityYen――

Ratio of ordinary
income to total
assetsRatio of operating
income to net sales

%
4.0
(6.6)

%
3.2
(8.8)

%
1.1
4.0

(Reference) Equity in earnings of affiliates: Fiscal year ended February 28, 2022
Fiscal year ended February 28, 2021

¥27 million¥61 million(2) Consolidated financial position
Total assets
Million yen
140,440
154,951

As of February 28, 2022
As of February 29, 2021

Shareholders’ equity
ratio
%
69.2
62.6

Net assets
Million yen
97,73697,430(Reference) Shareholders’ equity: As of February 28, 2022,
As of February 28, 2021,

Net assets per share
Yen
1,075 44
1,074 81

¥97,212 million¥96,977 million(3) Consolidated results of cash flows
Cash flows fromoperating activities

Cash flows frominvesting activities

Million yen
1,380(5,300)FY ended February 2022
FY ended February 2021

Cash flows fromfinancing activities

Million yen(3,981)36,010Million yen(8,960)(11,170)

Cash and cash
equivalents at theend of period
Million yen
38,50349,761

2. Dividends
Annual dividend
End of
1Q

End of2Q

End of3Q

Year-end

Total

Dividend
Total dividend payout ratio(Consolidated)%

Rate of total
dividend to
net assets(Consolidated)
%

Yen

Yen

Yen

Yen

Yen

Million yen

FY ended February 2021

―

0.00

―

0.00

0.00

―

―

―

FY ended February 2022

―

0.00

―

5.00

5.00

457

44.2

0.5

FY ended February 2023
(forecast)

―

0.00

―

7.00

7.00

42.2

3. Forecast of Consolidated Business Results for the Fiscal Year Ending February 28, 2023 (March 1, 2022 to February 28, 2023)(% change from the corresponding period of the previous fiscal year)
Net sales

Second quarter(Cumulative)
Full fiscal year

Operating income

Million yen%

Million yen

76,470157,350

18.1
12.1

(985)
1,500

%

Ordinary income
Million yen―(66.2)

%

(520)
2,400

―
(58.9)

Profit attributable toowners of parent
Million yen
(240)
1,500

Net income
per share

%

Yen

―
46.7

(2.66)
16.59＊Notes:(1) Changes in significant subsidiaries during the period: Yes
Changes in specified subsidiaries resulting in a change in the scope of consolidation
Deselection 2 companies (SANEI-INTERNATIONAL CO., LTD. and TSI GROOVE AND SPORTS CO., LTD.)(2) Changes in accounting policies, accounting estimates, and restatements
a. Changes in accounting policies due to revisions of accounting standards: Noneb. Changes in accounting policies other than above (a): Nonec. Changes of accounting estimates: Yes
d. Restatements: None
(3) Number of shares issued (common stock)a. Number of shares issued
at the end of period(treasury stock included) FY ended February 2022
b. Number of treasury
stock at the end of period FY ended February 2022
c. Average number ofshares over the period
FY ended February 2022

95,783,293 shares

FY ended February 2021

95,783,293 shares

5,390,033 shares

FY ended February 2021

5,556,309 shares

90,306,433 shares

FY ended February 2021

90,560,235 shares* Summary of financial statements is not subject to audit by a certified public accountant or an audit corporation.
*Explanation regarding the appropriate use of business forecasts and other special instructions
The forward-looking statements, including business forecasts, contained in this document are based on information currently
available to the Company and on certain assumptions deemed reasonable by the Company, and are not intended as a promise by
the Company that they will be achieved. Actual results may differ materially due to a variety of factors. Please refer to "(3)Explanation of Consolidated Business Forecast and Other Forward-looking Statements " on page 3 for the assumptions underlying
the forecasts and cautionary statements regarding the use of the forecasts.

Contents of Attached Materials
1. Overview of Business Results ···································································································· 2(1) Overview of Business Results for the Fiscal Year Ended February 28, 2022 ································· 2(2) Overview of Financial Position ···························································································· 3(3) Overview of Cash Flows ······································································································· 3(4) Outlook ····························································································································· 4
2. Basic Stance on the Selection of Accounting Standards ·································································· 4
3. Consolidated Financial Statements and Major Notes ···································································· 5(1) Consolidated Balance Sheets ································································································ 5(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ········· 7(3) Consolidated Statements of Changes in Net Assets ·································································· 8(4) Consolidated Statements of Cash Flows ················································································11(5) Notes to Consolidated Financial Statements ··········································································13
Going Concern Assumption ··································································································13
Major Notes to Consolidated Financial Statements ··································································13
Change in reporting method ······················································································ 17
Change in an accounting estimate ············································································· 17
Additional Information ········································································································18
Segments of the Company and Related Information ·································································20
Per Share Information ·········································································································22
Important Subsequent Events ······························································································ 23

-1-

1.

Overview of Business Results(1) Overview of Business Results for the Fiscal Year Ended February 28, 2022
In fiscal 2021, the twelve-month period from March 1, 2021 to February 28, 2022, the apparel industry was expected
to see a recovery in consumer spending due to the progress of vaccination against the COVID-19 and the end of thedeclaration of a state of emergency that had been issued by the government in stages.
Nevertheless, the number of infections did not significantly decrease because of the rapid spread of a new mutant
strain of the COVID-19 and the trend toward voluntary restraint on outings and shortened business hours at somecommercial facilities continued, resulting in a severe situation that still had an impact on sales.
Under such a business environment, our group is using the TSI Innovation Program 2024 (TIP24) as a springboard to
focus attention on withdrawing from unprofitable businesses and shops, reducing labor costs, and reducing SG&A
expenses across the entire company. Following this, we will shift to a phase that involves boosting efforts in the rapidly
growing area of EC business, and breaking into IT system business and other new business, etc. We will also actively
invest for the future to maximize profitability in the group.
Following this, we moved into a phase of strengthening our fast-growing EC business and IT systems and entering
new businesses and aggressively invested for the future to maximize profitability in the Group. Moreover, theabsorption-type merger was conducted in March 2021 as the first step toward the integration of the Group’s companies
into one company (after the subsidiary SANEI bd CO., LTD. merged with eight other apparel subsidiaries, the tradename was changed to “TSI Inc.”). Through this change, we have aimed to further improve the speed of decision-making
and operational efficiency.
Although the number of new infections of the COVID-19 in Japan has been decreasing since the end of thedeclaration of a state of emergency issued on September 30, 2021, the trend of refraining from going out has notcompletely ended, and consumer confidence has not completely returned. Although the over-the-counter sales of ourgroup companies showed a recovery trend, the harsh business climate continued due to a decrease in customer traffic.
In response, we have been taking measures such as strengthening sales through EC, curbing excess inventory, andcontrolling costs by strictly monitoring product purchases and holding them to an appropriate level.
Accounting for each of these factors, net sales came to ¥140,382 million in fiscal 2021, up 4.7% compared with theprevious fiscal year. From a profit perspective, TSI Holdings incurred an operating income of ¥4,440 million and an
ordinary profit of ¥5,834 million. This was a negative turnaround from the operating income of ¥11,843 million andordinary income of ¥10,359 million posted in fiscal 2021.
The Company’s net income attributable to owners of parent totaled ¥1,022 million, down 73.5% compared with theprevious fiscal year.
Net sales by reportable segment were as follows.

Apparel-Related Businesses
Based on the above TIP24, TSI Group subsidiaries composing our apparel-related businesses have made efforts bywithdrawing unprofitable businesses and store and by reducing SG&A such as labor costs across the entire company.
Based on the medium-term management strategy, TSI Group subsidiaries continued to improve profits by reforming
existing brands and streamlining operations. Amid the need to manage high market value brands that are unique andare price competitive, the Group worked diligently to strengthen its profitability by rolling out products that take fulladvantage of special features in its existing businesses including PING, St ANDREWS and HUF of street apparelbrands, and wander with a focus on outdoor fashion, CADUNE of a ladies brand. Despite these endeavors, we havesuffered from COVID-19 including shorten its business hours because of continuation of the state of emergency.
In the e-commerce business, we tried to increase sales by strengthening in-store and online coordination including theconsolidation of in-store inventory to e-commerce stock, online customer service and OMO.
Through these initiatives, net sales of the apparel-related businesses reached ¥135,812 million (up 4.4% year on year).

-2-

Other Businesses
Companies within TSI Holdings’ other businesses include S-Groove Co., Ltd., which in addition to fulfilling a sales
function for Group operating companies engages in paid employment placement and worker dispatching activities,
Toska-Bano’k Co., Ltd., active in the manufacture and sale of synthetic resin related products, Plax Co., Ltd., which
engages in store design and supervision as well as restaurant operations, Laline JAPAN Co., Ltd., which procures andsells a variety of products including cosmetics, perfumes, and soaps, and Urth Caffe JAPAN Co., Ltd., which operates
in Japan a popular organic café in the U.S., California. Net sales in this segment decreased by 38.6% compared withthe previous fiscal year, to ¥5,256million owing mainly to subsidiary integration.
(2) Overview of Financial Position(Million yen)
At the end of FY2021(As of February 28, 2021)

At the end of FY2022(As of February 28, 2022)

Increase/decrease

Total assets

154,951

140,440(14,510)

Liabilities

57,52142,704(14,816)

Net assets

97,43097,736306

Shareholders’ equity ratio
Net assets per share

62.6%

69.2%

6.6%

¥1,074.81¥1,075.44¥0.63

Total assets decreased by ¥14,510 million due to a decrease in cash and deposits (down ¥10,612 million from the endof the previous period ), a decrease in property, plant, and equipment (down ¥1,605 million), a decrease in intangible
assets (down ¥3,405 million) and a decrease in "other" under investments and other assets (down ¥768 million), despite
an increase in "other" under current assets (up ¥2,668 million), among others.
Liabilities decreased by ¥14,816 million dues to decreases in notes and accounts payable-trade (down ¥1,012 million
from the end of the previous period), accounts payable-other (down ¥1,719 million), income taxes payable (down ¥1,944
million), and long-term borrowings (including current portion of long-term borrowings) (down ¥8,982 million).
Net assets increased by ¥306 million from the end of the previous fiscal year, despite a decrease in Valuationdifference on available-for-sale securities (down ¥1,753 million). This was mainly due to an increase in retained
earnings(up ¥1,022 million) and an increase in foreign currency translation adjustment (up ¥927 million).
As a result, net asset per share increased by ¥0.63.
(3) Overview of Cash Flows(Million yen)
At the end of FY2021
At the end of FY2022
Increase/decrease(As of February 28, 2021) (As of February 28, 2022)
Cash flows from operating activities(5,300)

1,380

6,680

Cash flows from investing activities

36,010(3,981)(39,991)

Cash flows from financing activities(11,170)(8,960)2,209Cash and cash equivalents at end of period

49,761

38,503(11,257)

1) Cash flows from operating activities:
Net cash provided by operating activities for the current consolidated fiscal year amounted to ¥1,380 million, comparedto net cash used in operating activities of ¥-5,300 million in the previous fiscal year. This was mainly due to thepostings of ¥2,712 million in income before income taxes, the postings of ¥3,650 million in depreciation, which is noncash expenses and impairment loss of ¥4,225 million, despite an increase in inventories of ¥907 million, a decrease inpurchase debt of ¥994 million, a decrease in accounts payable-other of ¥1,741 million, the postings of ¥1,698 million
in gain on sales of investment securities, which were adjustment items for investment activities and the postings of¥3,201 million in income taxes paid.

-3-2) Cash flows from investing activities:
Net cash used in investing activities for the current consolidated fiscal year stood at ¥3,981 million (compared to net
cash provided by investing activities of ¥36,010 million in the previous fiscal year), mainly due to the purchase ofproperty, plant, and equipment (store interior assets, etc.) of ¥1,123 million, purchase of investment securities of¥8,512 million and payment of leasehold and guarantee deposits of ¥1,195 million, despite the sales of investment
securities of ¥6,137 million and collection of leasehold and guarantee deposits of ¥1,214 million.
3) Cash flows from financing activities:
Net cash used in financing activities for the current consolidated fiscal year was ¥8,960 million (¥11,170 million in
the previous fiscal year), mainly due to a net decrease in short-term borrowings of ¥52 million and repayment of longterm borrowings of ¥8,969 million. Consequently, cash and cash equivalents at the end of the current consolidated
fiscal year decreased by ¥11,257 million from the end of the previous fiscal year to ¥38,503 million.
(Reference) Changes in cash flow-related indicators(For Reference) Trends in Cash-Flow Indicators
FY2020
FY2021
FY2022(As of February 29, 2020) (As of February 28, 2021) (As of February 28, 2022)
Shareholders' equity ratio (%)

59.2

62.6

69.2

Shareholders’ equity ratio based on
current market price (%)

24.2

15.3

21.5

Years of debt redemption (Years)

7.1

―

11.7

Interest coverage ratio (Times)

21.7

―

12.6

Notes:
1. Shareholders’ equity ratio based on current market price (%) = total market value of common stock ÷ total assets
2. Years of debt redemption = interest-bearing debt ÷ cash flows from operating activities
3. Interest coverage ratio = cash flows from operating activities ÷ interest payments
4. Interest-bearing debt includes all balance-sheet debt for which interest payments are being made.
5. Interest payment are based on the amount of interest paid on the consolidated statement of cash flows.
6. All indicators are calculated based on consolidated financial figures.
7. As the cash frows from operating activities for the fiscal year ended February 28, 2021 was negative, the years ofdebt redemption and interest coverage ratio are not calculated.
(4) Outlook
Although the economic impact of the spread of the COVID-19 is continuing and remains to be seen, it is expected thatthe infection will be brought under control to some extent in the second half of the fiscal year ending February 28,
2023 (fiscal 2022) through vaccination and the spread of oral antiviral drugs for people with a mild condition.
Although we expect a certain level of recovery in sales for fiscal 2022, we anticipate a considerable delay in the recoveryof the economic situation due to growing social unrest following the invasion of the Republic of Ukraine by RussianFederation forces and the recent sharp rise in commodity prices. Meanwhile, we expect net income attributable toowners of parent for fiscal 2022 to be ¥ 1,500 million, based on aggressive investments in growth areas such as EC
and athleisure, where demand is continuously on the increase.
2.

Basic Stance on the Selection of Accounting Standards

The TSI Holdings Group has adopted the Japanese Generally Accepted Accounting Principles (Japanese GAAP) to
facilitate comparisons of consolidated financial statements of different fiscal terms and companies.
Meanwhile, the Group’s policy is to properly address the application of International Financial Reporting Standards(IFRS) after taking into consideration various circumstances in Japan and overseas.

-4-

2. Consolidated Financial Statements and Major Notes(1) Consolidated Balance Sheets(Million yen)
FY2021(As of February 28, 2021)

FY2022(As of February 28, 2022)

AssetsCurrent assets
Cash and deposits

49,871

39,258Notes and accounts receivable–trade
Securities

10,888―

10,378969

Merchandise and finished goods
Work in process

17,034544

17,597494

Raw materials and supplies
Other

821
3,594
(39)

634
6,263
(48)

82,71475,547

Property, plant and equipment
Buildings and structures

17,73016,126

Accumulated depreciation

Allowance for doubtful accounts
Total current assets
Non-current assets(12,122)(11,639)

Buildings and structures, net

5,607

4,487

Machinery, equipment and vehicles

1,146

1,079

Accumulated depreciation

(950)

(907)

Machinery, equipment and vehicles, net

195

172

903
558

958
532

(531)

(517)

27

15

Land
Leased assets
Accumulated depreciation
Leased assets, net
Other

7,565

6,876

Accumulated depreciation(6,149)(5,965)

Other, net

1,415

911

8,149

6,544

Total property, plant and equipment
Intangible assets
Goodwill

5,266

2,044

Trademark right
Other

3,646
3,757

3,379
3,841

Total intangible assets

12,6709,265

Investments and other assets
Investment securities

28,87228,397Long-term loans receivable
Leasehold and guarantee deposits

76
11,222

94
10,742

Deferred tax assets
Investment property, net

1,021
4,980

634
4,735

Other
Allowance for doubtful accounts

5,350
(106)

4,581
(102)

Total investments and other assets

51,41649,083

72,23764,893

154,951

140,440

Total non-current assets
Total assets-5-

(Million yen)
FY2021(As of February 28, 2021)

FY2022(As of February 28, 2022)

11,607

10,595

Liabilities
Current liabilities
Notes and accounts payable–trade
Short-term borrowings
Current portion of long-term borrowings

152

114

8,915

6,212

Lease obligations
Accounts payable–other

13

11

4,645

2,925

2,196

251

Income taxes payable
Provision for bonuses

1,336

1,327

Provision for point card certificates
Provision for shareholder benefit program

426

453

126

139

Provision for sales returns
Reserve for transfer

289

310

―

87

Asset retirement obligations
Other

12

650

6,246

5,293

Total current liabilities

35,96928,375

Non-current liabilities
Long-term borrowings

16,0829,803

Lease obligations
Deferred tax liabilities

36

36

1,029

1,065

Provision for retirement benefits for directors
Retirement benefit liability

42

37

1,040

979

Asset retirement obligations
Other

2,344

2,010

975

396

Total non-current liabilities

21,551

14,32957,52142,704

Total liabilities
Net assets
Shareholders’ equity
Share capital

15,00015,000Capital surplus
Retained earnings

29,25529,25552,21353,236

Treasury stock(3,747)(3,668)

Total shareholders’ equity

92,72093,822

4,812

3,058

Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Total accumulated other comprehensive income
Non-controlling interests
Total net assets
Total liabilities and net assets

-6-

(469)

457

(86)

(126)

4,256

3,389

452

523

97,43097,736

154,951

140,440

(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated statements of income(Million yen)
FY2021(March 1, 2020 toFebruary 28, 2021)

FY2022(March 1, 2021 to
February 28, 2022)

Net sales

134,078

140,382

Cost of sales

70,23263,555Gross profit

63,84676,826

Selling, general and administrative expenses

75,68972,386

Operating income (loss)(11,843)

4,440

34

30

1,065

761

1,297

300

-

302

Non-operating income
Interest income
Dividend income
Real estate income
Foreign exchange gain
Other

603

512

3,000

1,908

Interest expenses
Foreign exchange losses

216

109

26

-

Rental expenses on real estate
Loss on valuation of investment securities

876

134

32

20

Total non-operating income
Non-operating expenses

Other

364

250

1,516

514

Ordinary income (loss)(10,359)

5,834

Extraordinary income
Gain on sales of non-current assets

24,024

391

364

1,714

438

33

Total non-operating expenses

Gain on sale of investment securities
Subsidies for employment adjustment
Other
Total extraordinary income
Extraordinary losses
Loss on retirement of non-current assets

31

403

24,859

2,543

80

92

Impairment loss
Loss on sales of investment securities

3,068

4,225

559

16

Loss on liquidation of subsidiaries and associates
Loss due to temporary closing

1,192

4

2,414

1,193

Voluntary retirement-related expenses
Provision for transfer costs

1,160

―

―

87

Other

169

45

Total extraordinary losses

8,644

5,664

Income before income taxes

5,855

2,712

Income taxes―current
Income taxes―deferred

2,337

528

(233)

1,186

Total income taxes

2,103

1,715

Net income

3,751

996

Net loss attributable to non-controlling interest

(109)

(25)

Net income attributable to owners of parent

3,861

1,022

-7-

Consolidated statements of comprehensive income(Million yen)
FY2021(March 1, 2020 toFebruary 28, 2021)
3,751

FY2022(March 1, 2021 to
February 28, 2022)
996

1,182
(269)
(8)

(1,753)
963
(40)

(20)
884

15
(815)

Comprehensive income

4,636

181

Total comprehensive income attributable to:
Owners of parent

4,759

155

(123)

25

Net income
Other comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans
Share of other comprehensive income of affiliates
accounted for using equity method
Total other comprehensive income

Non-controlling interests(3) Consolidated Statements of Changes in Net Assets
FY2021 (March 1, 2020 to February 28, 2021)(Million yen)
Shareholders’ equity

Balance at the beginningof period

Share capital

Capital surplus

15,00036,463Retainedearnings
49,987

Treasury stock

Total
shareholders'equity△9,856

91,594

Changes during period
Dividends of surplus
Net income
attributable to ownersof parent
Purchase of treasury
shares
Disposal of treasury
sharesCancellation oftreasury shares
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at the end of
period△1,635△1,635

3,861

3,861

△7,208△1,177△1,177

77

77

7,208

-

―

△7,208

2,226

6,108

1,126

15,00029,25552,213△3,74792,720-8-

Accumulated other comprehensive income
NonValuation
Foreign currency Remeasure-ments Total accumulated controlling
difference ontranslationof defined benefit
other compreinterests
available-for-saleadjustment
plans
hensive income
securities
Balance at the beginningof period

3,630

(192)

(78)

3,358

498

Total net
assets95,451

Changes during period
Dividends of surplus
Net income (loss)
attributable to ownersof parent
Purchase of treasury
shares
Disposal of treasury
sharesCancellation oftreasury shares
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at the end of
period(1,635)
3,861(1,177)
77
―
1,182

(276)

(7)

897

(45)

852

1,182

(276)

(7)

897

(45)

1,978

4,812

(469)

(86)

4,256

452

97,430

FY2022 (March 1, 2021 to February 28, 2022)(Million yen)
Shareholders’ equity

Balance at the beginningof period

Share capital

Capital surplus

15,00029,255Retainedearnings
52,213

Treasury stock

Total
shareholders'equity(3,747)92,720Changes during period―

Dividends of surplus
Net income
attributable to ownersof parent
Purchase of treasury
shares
Disposal of treasury
sharesCancellation oftreasury shares
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at the end of
period

1,022

1,022
(0)

(0)

79

79
―

―

―

1,022

79

1,101

15,00029,25553,236(3,668)93,822-9-

Accumulated other comprehensive income
Valuation difference Foreign currency
on available-fortranslation
sale securities
adjustment
Balance at the beginningof period

4,812

Remeasurements ofdefined benefit
plans

Total
accumulated
other comprehensive income

Noncontrollinginterests

(86)

4,256

452

(469)

Total net
assets97,430Changes during period
Dividends of surplus
Net income
attributable to ownersof parent
Purchase of treasury
shares
Disposal of treasury
sharesCancellation oftreasury shares
Net changes in items
other thanshareholders' equity
Total changes during
periodBalance at the end of
period

―
1,022
(0)
79
―
(1,753)

927

(40)

(866)

70

(795)

(1,753)

927

(40)

(866)

70

306

3,058

457

(126)

3,389

523

97,736- 10 -

(4) Consolidated Statement of Cash Flows(Million yen)
FY2021(March 1, 2020 toFebruary 28, 2021)

FY2022(March 1, 2021 to
February 28, 2022)

Cash flows from operating activities
Income before income taxes
Depreciation
Amortization of goodwill
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in retirement benefit liability
Increase (decrease) in provision for retirement
benefits for directors
Increase (decrease) in provision for bonuses
Increase (decrease) in provision for sales returns
Increase (decrease) in provision for point cardcertificates
Increase (decrease) in provision for shareholder
benefit program

5,855

2,712

4,080

3,650

762

788

(38)

3

(3)

(90)

(55)

(4)

28

21

120

18

(46)

31

55

13

―

87

Interest and dividend income
Interest expenses(1,099)

(792)

216

109

Loss (gain) on sales of non-current assets
Loss on retirement of non-current assets(24,015)

(375)

80

92

Impairment loss
Loss due to temporary closing

3,068

4,225

2,414

1,193

Voluntary retirement-related expenses
Loss (gain) on sales of investment securities

1,160

―

195

(1,698)32

20

Loss (gain) on valuation of investment securities
Loss on liquidation of subsidiaries and associates
Subsidies for employment adjustment
Decrease (increase) in accounts receivables–trade
Decrease (increase) in inventories
Increase (decrease) in accounts payables–trade
Increase (decrease) in accrued consumption taxes
Increase (decrease) in accounts payable–other
Increase (decrease) in long-term accounts payable–
other
Other

1,192

4

(438)

(33)

1,287

459

3,723

(907)

(2,749)

(994)

859

(303)

(145)

1,190

(31)

―

(710)

(3,547)

Subtotal(4,198)5,873Interest and dividends received
Interest paid

1,099

792

(216)

(109)

Income taxes paid
Income taxes refund(549)(3,201)

749

90

Payment for loss due to temporary closing
Payment for voluntary retirement-related expenses(2,185)(1,118)―(947)

Net cash provided by (used in) operating activities(5,300)1,380- 11 -

(Million yen)
FY2021(March 1, 2020 toFebruary 28, 2021)

FY2022(March 1, 2021 to
February 28, 2022)

Cash flows from investing activities
Net decrease (increase) in time deposits
Purchase of property, plant and equipment
Proceeds from sales of property, plant and equipment
Purchase of investment securities
Proceeds from sales of investment securities
Purchase of intangible assets
Payments of leasehold and guarantee deposits
Proceeds from collection of leasehold and guarantee
deposits
Proceeds from collection of leasehold and guarantee
deposits
Purchase of investment property
Proceeds from sales of investment property
Short-term loan advances
Collection of short-term loans receivable
Purchase of shares of subsidiaries resulting in change
in scope of consolidation
Payments for sales of shares of subsidiaries resulting
in change in scope of consolidation
Proceeds of shares of subsidiaries resulting in change
in scope of consolidation
Proceeds of shares of business transfer

600

(689)

(2,927)(1,123)4,300

56(8,397)(8,512)

7,672

6,137

(710)

(967)

―

380

(933)

(1,195)

1,440

1,214

(13)

―

34,031

89

(27)

(43)

407

26

(656)

―

(6)

(91)

―

25

―

20

Payments for asset retirement obligations
Other

(578)

(354)

1,807

1,047

Net cash provided by (used in) investing activities

36,010(3,981)

Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings

55

(52)

478

―

(8,934)(8,969)

Repayments of lease obligations
Purchase of treasury shares

(31)

(17)

(1,180)(0)Proceeds from sales of treasury shares
Dividends paid

77

79

(1,635)―

Net cash provided by (used in) financing activities
Effect of exchange rate change on cash and cash
equivalents
Net increase (decrease) in cash and cash equivalents(11,170)(8,960)(11)

304

19,528(11,257)

Cash and cash equivalents at beginning of period

30,232

49,761

Cash and cash equivalents at end of period

49,761

38,503- 12 -

(5) Notes to the Consolidated Financial Statements

Going Concern Assumption
Not applicable

Major Notes to Consolidated Financial Statements
1. Scope of consolidationi. Number of consolidated group companies: 28
Major subsidiaries:
TSI Inc.
HUF Holdings, LLC
Ueno Shokai Co., Ltd.
Consolidated subsidiaries other than the above: 25

Change in the scope of consolidation
In the current consolidated fiscal year, SANEI bd CO., LTD., a consolidated subsidiary of the Company, completed anabsorption-type merger of SANEI-INTERNATIONAL Co., Ltd., TSI GROOVE AND SPORTS CO., LTD., nanouniverse CO., LTD., anglobal Ltd., Rose Bud Co., Ltd., Isolar Co., Ltd., TSI EC STRATEGY CO., LTD., and TSIPRODUCTION NETWORK CO., LTD., all of which were consolidated subsidiaries of the Company (and changed its
trade name to TSI Inc.). Hence, these eight companies were excluded from the scope of consolidation.
The Company excluded SPIC INTERNATIONAL Co., Ltd. from the scope of consolidation due to the transfer of allshares held by the Company.
anglobal, a consolidated subsidiary of the Company, was excluded from the scope of consolidation due to the transfer
of all shares of d'un a dix co. ltd. held by anglobal.
TSI SOCIAL WORKS, which was newly established by TSI PRODUCTION NETWORK CO., LTD., a consolidated
subsidiary of the Company, through an incorporation-type company split, is included in the scope of consolidation.
Laline Hawaii Corporation was excluded from the scope of consolidation because of the completion of liquidation.
ii. Major non-consolidated subsidiaries
Major non-consolidated subsidiaries:
Tokyo Fashion (Kaito) Co., Ltd.

Reason for exclusion from the scope of consolidation
Non-consolidated subsidiaries are excluded from the scope of consolidation because they are small companies andtheir combined total assets, net sales, net income or loss (amount corresponding to the Company's equity interest),
retained earnings (amount corresponding to the Company's equity interest), etc., do not have a material impact on
the consolidated financial statements.
2. Equity method
i. Number of subsidiaries and affiliates accounted for by the equity method: 1
Main company name:
RICHARD HENDRIX LLC（Change in the scope of the application of the equity method）
In the current consolidated fiscal year, MADE TO DESTROY LLC. was excluded from the scope of application of
the equity method due to the transfer of all shares of the company held by Jack Clothing Co., Ltd., the Company’s
consolidated subsidiary.
ii. Non-consolidated subsidiaries not accounted for by the equity method
Company name:- 13 -

Tokyo Fashion (Kaito) Co., Ltd.

Reason for exclusion from the scope of equity method
Non-equity method companies excluded from the scope of application of the equity method because their impact on
the Company's net income/loss (amount corresponding to the Company's equity interest) and retained earnings(amount corresponding to the Company's equity interest) is not material and their overall importance is not
significant.

3. Accounting period of consolidated subsidiaries
Among the Company’s consolidated subsidiaries, Tokyo Style Hong Kong Co., Ltd., Shanghai Dongnoue Tokiso
Trading Co., Ltd., TSI ASIA LIMITED, TSI US Holdings Co., Ltd., AVIREX SHANGHAI TRADING CO., LTD., andEfuego Corp. close their accounts on December 31.
The financial statements of each company as of December 31 are used in the preparation of consolidated financial
statements. Significant transactions that occurred between December 31 and the consolidated closing date areadjusted as necessary for consolidation purposes.
Among consolidated subsidiaries, HUF Holdings, LLC and HUF Worldwide, LLC, with the annual business term
set at 52 weeks, closed their accounts on the Saturday closest to December 31.
The financial statements of each company as of January 2, 2022 are used in the preparation of consolidated financial
statements. Significant transactions that occurred between January 2, 2022 and the consolidated closing date areadjusted as necessary for consolidation purposes.
Among consolidated subsidiaries, SANEI INTERNATIONAL USA LLC closes its accounts on June 30.
The quarterly financial statement of the company as of December 31 are used in the preparation of consolidated
financial statements. Significant transactions that occurred between December 31 and the consolidated closing dateare adjusted as necessary for consolidation purposes.
4. Accounting policies(1) Valuation criteria and methods for significant assets
i. Securities
Other securities
Marketable securities:
Marketable securities are carried at fair value based on quoted market prices as of the end of the fiscal year. Anychanges in unrealized gain or loss are directly included in net assets and the costs of securities sold are generally
calculated by the moving average method.
Non-marketable securities:
Non-marketable securities are carried at cost determined by the moving average method.
ii. Derivative financial instruments
Derivative financial instruments are stated at fair value.
iii. Inventories
a. Merchandise and finished goods, work in process and raw materials
They are primarily stated at cost method determined by the weighted average method (values on the balance
sheet are subject to the book value reduction method based on decreased profitability.)b. Supplies
They are primarily stated at the last purchase cost method (values on the balance sheet are subject to the bookvalue reduction method based on decreased profitability.)(2) Depreciation method for significant depreciable assets
i. Property, plant and equipment (excluding leased assets) and investment property- 14 -

The declining-balance method is mainly used. However, the straight-line method is used for buildings (excluding
attached facilities) acquired on or after April 1, 1998, and for building fixtures and structures acquired on or after
April 1, 2016.
The main useful lives are as follows.
Buildings and structures

3 to 50 years

Others2 to 20 years

ii. Intangible assets (excluding leased assets)
The straight-line method is adopted.
The main useful lives are as follows.
Software5 to 10 years

Trademark rights

10 yearsiii. Leased assets
Leased assets related to finance lease transactions other than those where the ownership of the lease assets isdeemed to be transferred to the lessee
Amortized by the straight-line method, assuming the lease period as the useful life and no residual value.
(3) Basis for accounting for significant provisions
i. Allowance for doubtful accounts
To prepare for losses due to the credit loss of monetary claims, the domestic consolidated subsidiaries consider
the actual loan loss rate for general claims and the collectability of specific claims such as doubtful debts
individually and record the estimated uncollectible amount. Overseas consolidated subsidiaries have provided
an allowance for doubtful accounts at the estimated uncollectible amount mainly for specific receivables.
ii. Provision for bonuses
To provide for the payment of bonuses to employees, the Company and its certain subsidiaries record theestimated amount of bonus payments corresponding to the consolidated fiscal year under review.
iii. Provision for point card certificates
Based on a system that confers points to customers in line with their purchase history, certain consolidated
subsidiaries posted amounts that can be expected to be used in the future in line with past trends as of the endof the fiscal year under review to provide for expenses arising from the use of points.
iv. Provision for shareholder benefits
Based on its shareholder benefit program, the Company posted an amount that it expects to be used in the future
in line with past trends as of the end of the fiscal year under review to provide for expenses arising from the useof shareholder benefit coupons.
v. Provision for sales returns
Certain consolidated subsidiaries posted amounts for estimated losses attributable to sales returns in line withsuch factors as historical rates of return to provide for losses from sales returns projected as of the end of the
fiscal year under review.
vi. Provision for retirement benefits for directors
Certain consolidated subsidiaries posted amounts stipulated under internal regulation as of the end of the fiscal
year under review to provide for the payment of retirement benefits to directors.
vii. Provision for relocation costs
Some consolidated subsidiaries posted estimates to be incurred to provide for the payment of cancellation
penalties in connection with office relocations.

- 15 -

(4) Accounting method for retirement benefits
i. Method of attributing the estimated amount of retirement benefits to the period
In calculating the retirement benefit obligations, the estimated amount of retirement benefits attributed to theend of the fiscal year under review is based on the benefit calculation formula.
ii. Amortization of actuarial differences and past service costs
Past service costs are amortized on a straight-line method over a fixed number of years (5 years) within the
average remaining service period of employees at the time they are incurred.
Actuarial differences are amortized on a straight-line method over a fixed number of years (5 years) within the
average remaining service period of employees at the time they are incurred. The Company amortizes them inthe following year of occurrence.
iii. Adoption of the simplified method for small-scale companies
Certain consolidated subsidiaries have adopted the simplified method of calculating retirement benefit liabilities
as well as retirement benefit expenses by using the amount required to be paid at the end of the fiscal year forvoluntary retirement benefits as the retirement benefit obligation.
(5) Basis for translating significant foreign currency-denominated assets and liabilities into Japanese currency
Monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the
spot rates of exchange on the consolidated closing date and the translation differences are treated as profit or loss.
Assets and liabilities as well as revenues and expenses of foreign consolidated subsidiaries are translated into
Japanese yen at the spot rate of exchange on the consolidated closing date, with translation differences included
in foreign currency translation adjustments and non-controlling interests in net assets.
(6) Significant hedge accounting methods
i. Hedge accounting method
Deferred hedge accounting is adopted.
However, the allocation method is applied to currency swaps that meet the requirements for the allocation
method and the exceptional method is applied to interest rate swaps where the requirements for the exceptional
method are met.
ii. Hedging instruments and hedged items
a. Hedging instruments Foreign exchange forward contracts
Hedged items

Foreign currency denominated trade payables and forecasted foreign currencytransactions

b. Hedging instruments Interest rate swaps
Hedged items

Interest on borrowingsc. Hedging instruments Currency swap
Hedged items

Foreign currency denominated borrowingsiii. Hedging policy
The Company hedges the foreign exchange fluctuation risk and interest rate fluctuations in accordance with the“Derivatives Management Regulations,” which are internal regulations.
iv. Assessment of hedge effectiveness
When entering into foreign exchange forward contracts, the Company allocates forward exchange contracts ofthe same amount and date denominated in the same currency in accordance with a risk management policy.

- 16 -

Because the correlation with subsequent fluctuations in foreign exchange markets is completely maintained,
any evaluation of effectiveness at the time of account settlement is not conducted.
In addition, any evaluation of effectiveness at the time of account settlement is not conducted for currency swaps
using the allocation method and interest rate swaps that meet the requirements for special treatment.
(7) Method and period of amortization of goodwill
Goodwill is amortized in equal amounts over a reasonable period of up to 20 years, based on individual estimatesof the period over which the investment effect will be realized.
(8) Scope of cash and cash equivalents in the consolidated statements of cash flows
Cash and cash equivalents consist of cash on hand, deposits that can be withdrawn from time to time, and shortterm investments that are easily converted to cash and that mature within three months of the date of acquisition
and are subject to insignificant risk of change in value.
(9) Other important matters for the preparation of consolidated financial statements
i. Accounting method for consumption tax, etc.
Consumption tax, etc. are accounted for by the tax exclusion method.
ii. Application of the consolidated taxation system
The Company and certain domestic subsidiaries apply consolidated tax payment system.
iii. Application of tax effect accounting for the transition from the consolidated taxation system to the group tax
sharing system
For the transition to the group tax sharing system established under the “Act for Partial Amendment of the
Income Tax Act, etc. (Law No. 8, 2020) and for items that were reviewed in the non-consolidated taxation system
in conjunction with the transition to the group tax sharing system, subject to the treatment of paragraph 3 of
the “Application of tax effect accounting for the transition from the consolidated taxation system to group tax
sharing system” (Practical Issues Task Force No. 39, March 31, 2020), the Company and certain domestic
consolidated subsidiaries do not apply the provisions of paragraph 44 of the “Guidance on Accounting Standards
for Tax Effect Accounting” (ASBJ Guidance No. 28, February 16, 2018) and calculate the amount of deferred tax
assets and deferred tax liabilities in accordance with the provisions of pre-revision tax laws.

Change in reporting method
Application of "Accounting Standard for Disclosure of Accounting Estimates"
The "Accounting Standard for Disclosure of Accounting Estimates" (ASBJ Statement No. 31, March 31, 2020) is
applied to the consolidated financial statements of the current financial year and notes on significant accounting
estimates are included in the consolidated financial statements.
However, in accordance with the transitional treatment stipulated in the proviso of Paragraph 11 of the accounting
standard, the contents related to the previous consolidated fiscal year are not described in these notes.

Change of accounting estimate
Provision for bonuses
In the end of this fiscal year, there is no prospect of convergence in preventing the spread of new coronavirus infections.
We have changed the estimate for the allowance for bonuses recorded in the previous consolidated fiscal year.
As a result of this change, operating income, ordinary income, and income before income taxes have increased. It has
increased by 587 million yen.

Valuation Criteria for Inventories
The Company has adopted a valuation criteria for inventories based on a certain devaluation rate determined inaccordance with the period since production or purchase. The Company’s balance sheet amount is based on the- 17 -

devalued book value. While we were affected by the expansion of covid-19, we've changed the sales policy and holded
down purchase and sales cost and along with that, we tried to improve the portion of the proper sales.
Consequently, the existing write-down rate deviates from that which would have been applied if the latest sales
results had been reflected. We therefore decided to reflect the latest sales results in the write-down rate that evaluates
the book value effective from this fiscal year. The change in the estimation method was made to reflect decline ininventory-related profitability more appropriately in the Company’s financial position and operating results.
As a result of this change, the cost of sales decreased by ¥1,876 million in this fiscal year. Consequently, operating
income, ordinary income, and income before income taxes increased by the same amount, respectively.

Additional Information
Trust-Type Employee Stock Ownership Plan (ESOP)TSI Holdings resolved at a Board of Directors’ meeting held on April 13, 2020 to reintroduce a trust-type employee
stock ownership plan (ESOP) as an incentive plan and part of its efforts to provide benefits for its employees.
i. Overview of the Plan
The Company has established a trust (the Shareholding Association Trust). The beneficiaries of the
Shareholding Association Trust are members of the TSI Employee Shareholding Association (the Shareholding
Association) who have met certain requirements.
The Shareholding Association Trust acquired in advance a number of TSI Holdings shares projected to beacquired by the Shareholding Association over a five-year period from April 2020 utilizing funds procured
through debt finance. Thereafter, acquisition of the Company’s shares by the Shareholding Association will be
undertaken by the Shareholding Association Trust. Meanwhile, TSI Holdings will guarantee the debt financeundertaken by the Shareholding Association Trust.
ii. Shares of the Company Remaining in the Trust
The shares of the Company remaining in the Trust are posted as shares of treasury stock in the net assets section
at their carrying amount in the Trust. The carrying amount and number of shares of treasury stock were ¥325
million for 696,000 shares as of the end of the previous fiscal year and ¥255 million for 545,000 shares as of theend of this fiscal year.
iii. Carrying Value of Debt Finance Posted Using the Gross Price Method¥359 million as of the previous fiscal year and ¥311 million as of the end of this fiscal year.

Board Benefit Trust (BBT)In accordance with a proposal put forward at the Company’s 5th General Meeting of Shareholders held on May
25, 2016, TSI Holdings introduced a performance-linked stock compensation (Board Benefit Trust (BBT)) plan for
its directors and delegated executive officers as well as Group company directors (eligible officers).
i. Outline of the Transaction
Under the plan, the Company’s shares are acquired through a trust using money contributed by the Company
as funds. Eligible officers receive the Company’s shares equivalent to the points granted in accordance with thelevel of performance achievement, etc., and money equivalent to the amount of the Company’s shares converted
at market value as of the date of retirement (the Company’s shares, etc.), pursuant to the officer stock delivery
regulations. Meanwhile, the timing of receipt of the benefits of the Company’s shares, etc. by eligible officers
shall, in principle, be upon their retirement from office.
ii. Shares of the Company Remaining in the Trust
The shares of the Company remaining in the Trust are posted as shares of treasury stock in the net assets section
at their carrying amount in the Trust. The carrying amount and number of shares of treasury stock were ¥288
million for 512,000 shares as of the end of the previous fiscal year and ¥279 million for 496,000 shares as of the- 18 -

end of the fiscal year under review.

Group reorganization (absorption-type merger organized by the Company and 14 consolidated subsidiaries)
At a meeting of its board of directors held on December 16, 2020, we resolved to undertake a reorganization withthe aim of integrating each of its apparel operating companies into a single company over the following threestages, with a scheduled completion date of March 1, 2023.
As a side note, at a meeting of its board of directors held on January 14, 2022, as we resolved to change thecompanies to be merged on March 1,2022, we will disclose a schedule of the reorganization as soon as we resolveit.
1. Stage 1: Absorption-type merger between consolidated subsidiaries on March 1, 2021
The Transaction under common control(1) Overview of the Transaction
i. Names and Businesses of the Combining Companies
Name of the Combining Company: SANEI bd CO., LTD.
Business: Apparel business
Names of the Combined Companies: SANEI-INTERNATIONAL CO., LTD.
TSI GROOVE AND SPORTS CO., LTD.
nano universe CO., LTD.
anglobal Ltd.
Rose Bud Co., Ltd.
Isolar Co., Ltd.
TSI EC STRATEGY CO., LTD.
TSI PRODUCTION NETWORK CO., LTD.
Business:

Apparel businessii. Date of Business Combination
March 1, 2021 and March 12,2021
iii. Legal Form of Business Combination
Absorption-typemerger

with

SANEI

bd

CO.,

LTD.,

as

the

survivingcompany,and

SANEIINTERNATIONAL CO., LTD., TSI GROOVE AND SPORTS CO., LTD., nano universe CO., LTD.,
anglobal Ltd., Rose Bud Co., Ltd., Isolar Co., Ltd., TSI PRODUCTION NETWORK CO., LTD., and TSI EC
STRATEGY CO., LTD., as the companies to be merged.
iv. Name of the Company after Business Combination
SANEI bd CO., LTD. (new corporate name: TSI Co., Ltd.)v. Other Matters Related to the Transaction
Nine consolidated subsidiaries underpinned by the same internal information systems, humanresources,and other systems were the subject of the absorption-type merger.
(2) Overview of the Accounting Treatment Applied
Pursuant to the “Accounting Standard for Business Combinations” (Accounting Standards Board of Japan(ASBJ) Statement No. 21 issued on January 16, 2019 and the “Guidance on Accounting Standard for Business
Combination and Accounting Standard for Business Divestitures” (ASBJ Guidance No. 10 issued on January
16, 2019), the absorption-type merger was treated as an under common control transaction.
2. Stage 2: Absorption-type merger between consolidated subsidiaries on March 1, 2022
At a meeting of its board of directors held on January 14, 2022, TSI Holdings’ Board of Directors resolved toundertake an absorption-type merger with TSI Inc., as the surviving company, and consolidated subsidiaries- 19 -

Ueno Shokai Co., Ltd., as the companies to be merged on the scheduled date of March 1, 2022(scheduled).
Regarding Jack Clothing Co., Ltd., Arpege Co., Ltd., Star Joinus Co., Ltd., and And Wonder Co., Ltd, though
they were described to be merged, we will disclose a schedule as soon as we resolve it because of the delay of thestandardization of infrastructure.

Segments of the Company and Related Information
Segment information
1. Overview of reportable segments(1) Method of determining segments
The reportable segments of the TSI Holdings Group are components for which separate financial information isavailable and whose operating results are regularly reviewed by the Board of Directors to make decision about
resource allocation and to assess their performance.
As a holding company, TSI Holdings is responsible for the management of each operating company focusing mainlyon the apparel business as well as the strategic functions of the Group as a whole. Each operating company inturn formulates comprehensive strategies for the apparel brands handled while engaging in business activities.
On this basis, the TSI Holdings Group is comprised of Apparel-Related businesses, a reportable segment, andOther Businesses.

(2) Products and services belonging to each reportable segment
In its Apparel-Related Businesses, the Group mainly engages in the planning, manufacture, and sale of apparelas well as brand licensing, production, and logistics operations. In its Other Businesses, the Group engages insuch activities as the provision of sales agency, temporary staffing, synthetic resin-related, store design andmanagement, restaurant services.
2. Calculation method of net sales, income or losses, assets and other items by reportable segments
The accounting method for the reportable segments is generally the same as the items stated in the “Major notes toconsolidated financial statements.”
The segment income or loss is based on operating income or loss.
The intersegment sales and amount of transfer are based on the prevailing market price.

- 20 -

3. Net sales, income or losses, assets and other items by reportable segments
FY2021 (March 1, 2020 to February 28, 2021)
Reportablesegment
Apparel-related
businesses

Other

Total

Adjustments
Note 1,2,4,5(Million yen)
Consolidated
financialstatements
amount(Note 3)

Net sales
Sales to third parties

129,862

4,138

134,00177

134,078

257

4,429

4,686

(4,686)―130,120

8,567

138,687(4,609)134,078

Segment income (loss)(11,800)(192)(11,993)150(11,843)

Segment assets

76,7007,067

83,767

71,183

154,951

2,715

186

2,902

1,178

4,080

2,699

452

3,151

523

3,675

Inter-segment sales or transfers
Total

Other items
Depreciation and amortization
expenseIncrease in property, plant andequipment and intangible assets
Notes:

1. The segment income adjustment of ¥150 million is transaction offsets among consolidated companies.
2. The segment assets adjustment of ¥78,183 million includes the Company-wide assets that are not belong torespective reportable segments of ¥76,471 million and elimination of internal transactions between consolidated
companies of ¥(5,287) million.
3. Segment income(loss) is adjusted to operating income listed in the consolidated financial statements.
4. The adjustment of depreciation and amortization of ¥1,178 million is mainly due to the amortization cost of theCompany-wide assets.
5. Adjustment of ¥523 million in increase in property, plant and equipment and intangible assets is mostly related to
the Company-wide assets.

- 21 -

FY2022 (March 1, 2021 to February 28, 2022)(Millions of yen)
Consolidated
financial
Adjustments
statements
Note 1, 2, 4, 5amount(Note 3)

Reportablesegment
Other

Apparel-related
businesses

Total

Net sales
Sales to third parties

135,702

4,590

140,29388

140,382

109

666

775

(775)

―

135,8125,256

141,069(687)

140,382

Segment profit

4,627

46

4,674

(234)

4,440

Segment assets

73,818

7,082

80,90159,539140,440

1,880

203

2,084

1,565

3,650

1,424

216

1,641

1,134

2,776

Inter-segment sales or transfers
Total

Other items
Depreciation and amortization
expenseIncrease in property, plant andequipment and intangible assets
Notes:

1. The segment loss adjustment of ¥(234) million is transaction offsets among consolidated companies.
2. The segment assets adjustment of ¥59,539 million includes the Company-wide assets that are not belong torespective reportable segments of ¥64,737 million and elimination of internal transactions between consolidated
companies of ¥(5,197) million.
3. Segment loss is adjusted to operating loss listed in the consolidated financial statements.
4. The adjustment of depreciation and amortization of ¥1,565 million is mainly due to the amortization cost of theCompany-wide assets.
5. Adjustment of ¥1,134 million in increase in property, plant and equipment and intangible assets is mostly related
to the Company-wide assets.

Per Share Information(Yen)
FY2021(March 1, 2020 to February 28, 2021)

FY2022(March 1, 2021 to February 28, 2022)

Net assets per share

1,074.81

1,075.44

Net income per share

42.64

11.32

Notes:
1. Data on diluted earnings per share is not presented since there were no potential shares with a dilutive effect.
2. With the Company’s shares held by the trust-type employee stock ownership plan (ESOP) treated as treasury stock,
the number of such shares is deducted from the number of shares issued as of the end of the fiscal year in thecalculation of net assets per share. The number of shares of treasury stock held by the Trust at the end of theprevious fiscal year was 696 thousand shares, and the number of shares of treasury stock held by the Trust at theend of the current fiscal year was 545 thousand shares.
3. With the Company’s shares held by the trust-type employee stock ownership plan (ESOP) treated as treasury stock,
the number of such shares is deducted from the average number of shares for the period in the calculation of net
income per share. Meanwhile, the average number of shares held by the Trust during the previous fiscal year was
696,000 shares and 545,000 shares during the fiscal year under review.
4. With the Company’s shares held by the Board Benefit Trust (BBT) treated as treasury stock, the number of such

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shares is deducted from the number of shares issued as of the end of the fiscal year in the calculation of net assets
per share. Meanwhile, the number of treasury stock held by the Trust as of the end of the previous fiscal year was
512,000 shares and 496,000 shares as of the end of the fiscal year under review.
5. With the Company’s shares held by the Board Benefit Trust (BBT) treated as treasury stock, the number of suchshares is deducted from the average number of shares for the period in the calculation of net income per share.
Meanwhile, the average number of shares held by the Trust during the previous fiscal year was 514,000 sharesand 503,000 shares during the fiscal year under review.
6. The basis for calculating net income per share is as follows.
FY2019(March 1, 2019 toFebruary 29, 2020)
Net income attributable to owners of parent(Million yen)

FY2020(March 1, 2020 toFebruary 28, 2020)

3,861

1,022

Amount not attributable to shareholders on common
stock (Million yen)――

Net income attributable to owners of parent on common
stock (Million yen)

3,861

1,022

Average number of shares of common stock during theperiod (Shares)

90,56090,306

Important Subsequent Events
Absorption-type merger between consolidated subsidiaries
At a meeting of the Board of Directors held on January 14, 2022, the Company resolved to conduct an absorptiontype merger, with TSI Inc. as the surviving company and Ueno Shokai Co., Ltd., a consolidated subsidiary of theCompany, as the absorbed company, and conducted the merger on March 1, 2022.
(1) Overview of the Transaction
i. Names and Businesses of the Combining Companies
Name of the Combining Company:

TSI Co., Ltd.

Business:

Apparel business

Names of the Combined Companies:

Ueno Shokai Co., Ltd.

Business:

Apparel businessii. Date of Business Combination
March 1, 2022
iii. Legal Form of Business Combination
Absorption-type merger with TSI Co., Ltd. as the surviving company Ueno Shokai Co., Ltd. as the companies
to be merged.
iv. Name of the Company after Business Combination
TSI Co., Ltd.
v. Other Matters Related to the Transaction
The merged company that proceeded with the commonization of internal systems such as information systems
and human resources was subject to an absorption-type merger.
(2) Overview of the Accounting Treatment Applied
Pursuant to the “Accounting Standard for Business Combinations” (Accounting Standards Board of Japan (ASBJ)
Statement No. 21 issued on January 16, 2019 and the “Guidance on Accounting Standard for Business Combination
and Accounting Standard for Business Divestitures” (ASBJ Guidance No. 10 issued on January 16, 2019), theabsorption-type merger was treated as an under common control transaction.

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