Results Briefing: Q2ND(March to August 2020)
Results of 2021 Ending Feb.
2020.10.5

I. Results Overview

2Unit:Million Yen
Cumulative Q2ND 2020

Cumulative Q2ND 2021 Ending Feb.

Ending Feb.
ResultsRate (%)

Results

Composition

Y/Y

Rate (%)

ChangeY/Y (%)

Against Plan

Against(Change)

Plan(％)Net Sales

81,847100.0

56,270100.0-25,576

68.8

▲229

99.6

Gross Profit

43,90853.6

24,16943.0-19,73955.0--

SG&A Expenses

44,072

53.8

34,63961.6-9,43378.6--

41,42650.6

32,50757.8-8,91978.5--

581

0.7

389

0.7-192

66.9

-

-

SG&A Expenses(excl. Goodwill Amortization, Depreciation and Amortization)

Goodwill Amortization
Depreciation and Amortization

1. Consolidated Financial
Highlights -Profit and Loss-

Composition

Operating Income
Ordinary Income

2,065

2.5

1,742

3.1

-322

84.4

-

-

-164

-0.2

-10,469-18.6-10,305-

3,031-

769

0.9-9,642-17.1-10,412

-

3,057

-

1,894

2.3

418

0.7

-1,47522.1--

Extraordinary Loss

372

0.5

4,014

7.1

3,641

1076.2--Profit Before Taxes

2,2902.8-13,237-23.5-15,528---

Profit Attributable to Owners of Parent

1,053

1.3

-14,434-25.7-15,487-

1,766-EBITDA ※2,482

3.0-8,337-14.8-10,820---Extraordinary Income

Net Sales: Sales of stores in prime locations were tough due to shortened business hours and refrainfrom going out, though all our stores have reopened since this June.
Sales of e-commerce ongoingly increased 118.1% year-on-year.
Gross Profit ratio: Deterioration of discount rate (▲6pt), loss on valuation of inventory(▲2pt),
Increase in discounted products etc.(▲2.6pt)
SG&A Expenses: In addition to reduction of variable costs, we tried to reduce fixed costs.
Extraordinary loss: Impairment loss of JPY1.4billion, loss of JPY2.4billion due to the temporary
suspension of operations.

3

Cumulative Q2ND 2020
Ending Feb.

2. Net Sales
Per Channel

Cumulative Q2ND 2021 Ending Feb.

Results

Composition

Results(Million yen)

Rate (%)(Million yen)

Y/Y (%)

Composition
Rate (%)

Composition
Rate

Y/Y Change

Department Stores

10,841

13.2

5,107

47.1

9.1-4.1pt

Commercial Facilities(*1)

41,96851.3

22,76854.3

40.5-10.8pt

In-house EC

5,175

6.3

8,989

173.7

16.0+9.7pt

3rd party

11,26513.8

10,434

92.6

18.5+4.7pt

E-Commerce

16,441

20.1

19,424118.1

34.5+14.4pt

Overseas

3,527

4.3

2,752

78.0

4.9+0.6pt

Others(*2)

9,068

11.1

6,218

68.6

11.1

-

TOTAL

81,847100.0

56,27068.8

100.0-*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.

4Unit:Million Yen
Cumulative Q2ND 2020 Ending Feb.
Sales

3. Brands Overview

Composition

Gross Profit

Rate (%)

Ratio (%)

Cumulative Q2ND 2021 Ending Feb.
Sales

Composition

Gross Profit

Rate (%)

Ratio (%)

Y/Y
Sales (%)

Gross Profit
Ratio (pt)1.

nano・universe

12,130

14.8

45.1

8,004

14.2

36.1

66.0

-9.0

2.

NATURAL BEAUTY BASIC

7,868

9.6

59.0

5,066

9.0

43.1

64.4

-15.9

3.

PEARLY GATES

6,270

7.7

51.2

4,439

7.9

50.3

70.8-0.94.

MARGARET HOWELL

6,887

8.4

57.5

3,509

6.2

43.4

51.0

-14.1

5.

AVIREX

3,764

4.6

61.4

2,359

4.2

55.4

62.7

-6.0

6.

STUSSY

2,520

3.1

70.7

2,049

3.6

62.9

81.3

-7.8

7.

UNDEFEATED

2,305

2.8

44.6

1,887

3.4

40.6

81.9

-4.0

8.

ROSE BUD

3,108

3.8

49.5

1,839

3.3

34.5

59.2

-15.0

9.

HUF

2,022

2.5

51.4

1,778

3.2

45.6

87.9

-5.8

10.

PROPORTION BODY DRESSING

1,763

2.2

53.2

1,453

2.6

51.6

82.4

-1.6TOP10

48,641

59.4

53.3

32,388

57.6

44.5

66.6

-8.8

Other Brands

32,873

40.2

54.6

23,861

42.4

40.9

72.6

-13.7

Continuing Brands

81,514

99.6

53.8

56,249

100.0

42.9

69.0

-10.9

333

0.4

13.7

21

0.0

69.7

6.3

+55.9

81,847

100.0

53.6

56,270

100.0

43.0

68.8

-10.6

Closed Brands
TOTAL

5

Ⅱ Medium-Termbusiness strategy

6Creating a fusion of digital and power of humanity, bringing
management and field closer, we accomplish the speedy business
operation suited to the digital age.
We will build a digital-fashion company which creates originality by creativity and logic.

Lower ofthe break-evenpoint

1. The objection andstrategy of businesscombination

Accelerate theSpeed in corporatemanagement

Power up ourBusiness creation

Change our mind,culture and work-style

01. DX of management and operations✓ Digitalization of back-office✓ Visualization of management index and KPI management

02. New strategy of merchandising and marketing✓ Strategy of merchandising and purchasing plan
✓ Content strategy for promotion✓ Core strategy for e-commerce with sales staff✓ Brand strategy for New Normal

04. Transfer sales channel to e-commerce✓ Investigation for fascinating User Interface✓ Unified commerce✓ Develop new customers without depending on stores

03. Digitalization of stores and earnings recovery✓ Earnings recovery of existing stores/
Strategy which has stores in prime locations.
✓ Investigation for digitalization of stores✓ Strategy for closing stores✓ Reciprocal customer transfer between stores ande-commerce.

05. Global strategy and development of human resources✓ Global strategy✓ Bring up digital-native brands

7✓ Conglomerate D2C businesses/Strategic M&A7

Medium-term management plan is presently developed by setting the following
three KPIs under the basic policy of integrating domestic business subsidiaries
into one company.

01 Creating new customer value by cutting-edge technology
Creation of
new brandvalues

2. Medium-Term
Reform programs

New valuethat ourservice
provides Evolve our service by Unified
commerce
 Merchandising for developing
new customers
 New business and creation ofbrands in the digital age.

EC/Digital ratio

50%

02 Sincerely and pro-environmentally providing products to customers
Effort toSustainable
development

HighlyDeveloped
forecast fordemand Conversion to the businessstructure that manufactures only
necessary amount Sincere price and brands to ourcustomers at any time and place

The full-pricesales ratio

80%

03 Keep on progressing by investing in business and human resources
Reform ofSCM/
productivity

Advancedmanufacturing

Improvement of productivity by DX
Reinforcement of the earnings basewithout being influenced by theenvironment
Visualization of management
An early realization of SGA ratio ofless than 50%

Operatingmargin of5%

8

Ⅲ Our plan for 2021
Ending February

9Unit:Million Yen
1st Half
ResultsResults

2020

2021

Results

Plan2020

2021

Full Year
Results

Plan2020

2021

Composition
Rait(%)

Y/Y(%)

56,270

100.0

68.7

88,22075,930

100.0

86.1

Operating Income-164 -10,469

-18.6

-

234-7,330

-9.7

-

70

Ordinary Income

769-9,642

-17.1

-

1,081

-7,058-9.3-

1,053 -14,434

-25.7

-

1,127

14,48419.1 1285.2

Ending Feb. Ending Feb.

Net Sales

1. Plan for 2021
Ending February

2nd Half

Profit Attributableto Owners of Parent

81,847

Ending Feb. Ending Feb.

Composition
Rait(%)

Y/Y(%)

Ending Feb. Ending Feb.

170,068 132,200

Composition
Rait(%)

Y/Y(%)

100.0

77.7-17,800-13.5-

1,851-16,700-12.6-

2,181

50

0.0

2.3

Net Sales: Plan is based on the guideline to restrain our purchasing to 70% in principle compared to theformer plan.
Operating income: Approximately 2 billion yen is planned as structural reform cost.
Extraordinary income: Approximately 1.8 billion yen is planned as sale of the land and building in
Shibuya ward.
Extraordinary loss: Approximately 1.7 billion yen is planned as impairment of the company due tovoluntary retirement.

10Get rid of all negative factors regarding reductionof fixed costs and disposal of underperforming
businesses by the end of this term.

2.Implementation ofmeasures for theCurrent Term(1)Reduction ofpersonnel
expenses

Implementation of downsizing 300 employees※Estimated cost reduction involving withdrawal of stores andwithdrawal of business

Withdrawal of 210 unprofitable stores ※Withdrawalof stores

Reductionof officespace▲2billion yen

Domestic 178 stores, Overseas 32 stores FY 2021
※ In addition to the above, withdrawal of several shops areunder consideration.
Withdrawal of 3 subsidiaries and 3 brands

Withdrawalof business▲3billion yen※

▲4billion yen

1st half …”TSI ASIA LIMITED” ,“Natural Beauty”and”FACT”
2nd half…”UNIT&GUEST”,”Laline Hawaii Corporation”and “Herschel Supply”※ In addition to the above, withdrawal of several businesses are underconsideration.

Reduction of office space
Start the project for 24 offices of subsidiaries.
11Careful Selection of investment for reinforcementof the earnings base

3.Implementation ofmeasures for theCurrent Term(2)Integration ofe-commerce
functions andhumanresources

D2Cbusinesses

Integrate e-commerce organization and functions in ourdomestic subsidiaries (About 180 people)
Integrate digital team in order to share their knowledge, sophisticate theiroperations and optimize investment on September 1stStart the D2C platform
Acquired business of the “ETRÉ TOKYO”,
we will establish the D2C platform.

Development Start 5 Brands“CADUNE” ”ELE STOLYOF”
of new“PING”“FLOML”
businesses

Restartoverseasbusinesses”quitan”

Digitalization of US Business
Innovation of e-commerce and marketing businessin HUF with the team of Tactics ,which we acquired
recently.

12Ⅳ Reference Data13Cumulative Q2ND 2020
Ending Feb.
All Stores：106.9%
Existing Stores ：99.7%

110.3
106.4 108.1 106.3

Domestic Monthly
Sales Information

Cumulative Q2ND 2021
Ending Feb.
All Stores： 66.6%
Existing Stores：82.0%

112.7

110.6
111.0

99.2
103.3

99.2 100.9 99.4

101.9
94.3

91.5

101.2

105.7

105.5

95.8 92.6
83.4

90.8

93.0 90.8 91.7
93.5

91.9
88.8

82.8 84.3
80.1

66.6

81.2

65.4

43.3
33.7

14

# of Stores

Q2ND 2020 Ending

FY Ending Feb.

StoreStoreQ2ND 2021 EndingFeb. ※1

2020

OpenClose※2Feb.

1,011998

Change-10-23# of Stores

7976

Change-64-67

1,090

1,074-74-90+55-70

983

DomesticStore Distribution-15+6-1864

Overseas# of Stores-12+61-88

1,047

Total
Change-27*1 Number indicated on "Change" rows are comparison with the end of 2019 Ending February.

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Disclaimer
Descriptions about future within this document are based on the informationthat the company obtains on the date of this report and certain assumptions
deemed to be reasonable. Actual earnings may differ materially from variousfuture factors.

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