[Translation]
Consolidated Business Results for the Third Quarter of the Fiscal Year Ending March 31, 2021
[U.S. GAAP]
January 29, 2021
Listed Company: Wacoal Holdings Corp.
Stock Exchange: Tokyo
Code Number: 3591
(URL: https://www.wacoalholdings.jp/)
Representative: (Position) Representative Director, President and Corporate Officer(Name) Hironobu Yasuhara
For Inquiries: (Position) Corporate Officer, General Manager of Corporate Planning (Name) Hiroaki Miyake
Tel: +81 (075) 682-1010
Scheduled quarterly report submission date:February 12, 2021
Scheduled dividend payment start date:
Supplementary materials regarding quarterly business results: Yes
Explanatory meeting regarding quarterly business results:
Yes (for institutional investors, analysts and the press)(Amounts less than 1 million yen have been rounded )1.

Third Quarter of the Fiscal Year Ending March 31, 2021 (April 1, 2020 – December 31, 2020)(1)

Consolidated Business Results(% indicates increase (decrease) from the corresponding period of the previous fiscal year)

Net Sales

Millions of Yen

Operating Income%

Third Quarter ended
114,901 (20.2)
December 31, 2020
Third Quarter ended
144,031 (2.2)
December 31, 2019
(Note)
Quarterly comprehensive income :Third Quarter ended
December 31, 2020
Third Quarter ended
December 31, 2019(2)

Millions of Yen%

Income Before
Income Taxes andEquity in Net Incomeof AffiliatedCompanies
Millions of Yen%

Net Income
Attributable to
Wacoal Holdings
Corp.
Millions of Yen

%

3,956

(59.6)

10,873(30.6)

4,972(54.9)

9,801(12.3)

15,669175.8

11,014

153.7

3,943 million yen ((61.4)%) for the third quarter ended
December 31, 2020
10,212 million yen (186.5 %) for the third quarter ended
December 31, 2019

Net Income
Attributable to
Wacoal Holdings
Corp. Per Share

Diluted Net Income
Attributable to
Wacoal Holdings
Corp. Per Share

Yen

Yen

79.67

79.34

171.16170.49Consolidated Financial Condition

As of December 31, 2020
As of the end of Fiscal
Year (March 31, 2020)

Total Assets

Total Equity(Net Assets)

Total
Shareholders’EquityTotal
Shareholders’Equity Ratio

Millions of Yen

Millions of Yen

Millions of Yen%

314,471

209,672

206,48165.7

3,308.60

277,688

209,448205,37174.0

3,291.06

Shareholders’Equity Per Share
Yen

2.

Status of Dividends

End of First
Quarter
Yen

Annual Dividend
End of Second End of Third
Quarter
Quarter
Yen

Yen

Fiscal Year Ended March 31, 2020
–
40.00
–
Fiscal Year Ending March 31, 2021
–
20.00
–
Fiscal Year Ending March 31, 2021
(Estimates)(Note) Revision of estimated dividends announced during the latest quarter: No
3.

Year-End

Total

Yen

Yen

20.00

60.00

20.00

40.00

Forecast of Consolidated Business Results for the Fiscal Year Ending March 31, 2021 (April 1, 2020 - March 31,
2021)(% indicates increase (decrease) from the previous fiscal year)

Net Sales

Millions of Yen %Income Before
Net (Loss)
Net (Loss)
Income Taxes
IncomeIncomeOperatingand Equity in Net
Attributable toAttributable to(Loss) Income
Income of
Wacoal Holdings Wacoal Holdings
AffiliatedCorp.
Corp. Per Share
Companies
Millions of Yen % Millions of Yen %Millions of Yen %Annual
156,000 (16.5)(1,000)300 (93.1)(500)(Note) Revision of forecast of consolidated business results announced during the latest quarter: No

Yen(8.01)

Notes(1)

Changes in significant subsidiaries in the consolidated cumulative third quarter of the current fiscal year (i.e.
changes in specified subsidiaries (tokutei kogaisha) which involve change in scope of consolidation): None

(2)

Application of simplified accounting methods and specific accounting methods: None

(3)

Changes in accounting principles:(i) Changes due to modifications in accounting standards, etc.: None(ii) Changes other than (i) above: None(4)

Number of Issued Shares (Common Stock)
Third Quarter ended
December 31, 2020
(i)
(ii)
(iii)

Number of issued shares (including
treasury stock) as of the end of:
Number of shares held as treasury
stock as of the end of:
Average number of shares duringconsolidated third quarter (third
quarter ended December 31):

Fiscal Year ended
March 31, 2020

65,589,042 shares

68,589,042 shares

3,181,704 shares

6,186,410 shares

62,403,898 shares

64,348,678 shares*These quarterly financial statements are exempt from the review procedures.

*Cautionary Statement regarding Forecast of Business Results(Cautionary note on forward-looking statements)
The forecast of business results is based on reasonable information we obtained as of the date hereof and, due to various
risks, uncertainties and other factors arising in the future, actual results in the future may differ largely from the estimates
set out in this document. For notes on conditions used for the forecast of business results and cautionary statements
regarding forecast of business results, please see “1. Qualitative Information regarding Consolidated Performance during
the Third Quarter – (3) Qualitative Information regarding Forecast of Consolidated Business Results” on page 8 of theattached materials.

Table of Contents for Attached Materials
1.

Qualitative Information regarding Consolidated Performance during the Third Quarter -------------------------

2(1)

Qualitative Information regarding Consolidated Business Results ----------------------------------------------------- 2(2)

Qualitative Information regarding Consolidated Financial Condition ------------------------------------------------- 7(3)

Qualitative Information regarding Forecast of Consolidated Business Results --------------------------------------- 8

2.

Consolidated Quarterly Financial Statements and Accompanying Notes ----------------------------------------------- 9(1)

Consolidated Quarterly Balance Sheets -------------------------------------------------------------------------------------- 9(2)

Consolidated Quarterly Statements of Income --------------------------------------------------------------------------- 11(3)

Consolidated Quarterly Statements of Comprehensive Income ------------------------------------------------------- 11(4)

Consolidated Quarterly Statements of Cash Flows ---------------------------------------------------------------------- 12(5)

Notes to Consolidated Quarterly Financial Statements ----------------------------------------------------------------- 13(Notes on Going Concern) -------------------------------------------------------------------------------------------------- 13(Notes on Significant Changes in the Amount of Total Shareholders’ Equity) -------------------------------------- 13(Segment Information) ------------------------------------------------------------------------------------------------------- 13(6)

Status of Sales ---------------------------------------------------------------------------------------------------------------- 14

-1-

1.

Qualitative Information regarding Consolidated Performance during the Third Quarter(1)

Qualitative Information regarding Consolidated Business Results(i)Performance Overview of the Nine Months ended December 31, 2020

Net sales
Cost of sales
Sales profit
Selling, general and administrative expenses
Operating income
Other income
A: Valuation gain on marketable securities andinvestments – net
Income before income taxes and equity in net incomeof affiliated companies
Net income attributable to Wacoal Holdings Corp.
Reference figure: Income before income taxes and equity
in net income of affiliated companies not taking into
account A

Previous Cumulative
Third Quarter(From April 1, 2019 to
December 31, 2019)
Amount144,031
63,915
80,11670,315
9,801
1,382
4,486

Current Cumulative
Third Quarter(From April 1, 2020 to
December 31, 2020)
Amount114,901
50,27964,62260,666
3,956
1,192
5,725

(Millions of Yen)
Increased/(Decreased) fromprevious cumulative
third quarter
Amount(29,130)(13,636)(15,494)(9,649)(5,845)(190)+1,239%(20.2)(21.3)(19.3)(13.7)(59.6)(13.7)+27.6

15,66910,873(4,796)(30.6)

11,014

4,972(6,042)(54.9)

11,183

5,148(6,035)(54.0)The business of our group during the current cumulative third quarter (April 1, 2020 – December 31, 2020) was
significantly impacted by the global spread of the coronavirus (the “outbreak”). Although a trend toward recovery isvisible as compared to April and May, when stay-at-home measures and temporary closings of physical stores were
implemented in many countries and regions, there are significant uncertainties as we continue to face the impact of the
spread of the outbreak. Under such circumstances, we continued to move forward with our initiatives to create amanagement structure that leads to high profitability based on the following policies for regrowth, while keeping the safety
and well-being of our customers, employees and partner companies as our first priority.
【Basic Policies】
To prioritize the health and safety of our customers, employees and partner companies【Short-Term Policies】 To implement cost reduction in response to deterioration in business conditions, and tosecure a stable financial foundation
・to reassess our current initiatives and spending plans in all business fields
・to strengthen liquidity on hand in preparation for the prolonged impact of the outbreak・to adjust production to avoid having excess inventory resulting from decreased sales【Mid- andLong-Term Policies】 To conduct thorough inspection and renovation of the value chain – turning point for
creating management structure that provides high profitability
・to reassess current cost structure (promote initiatives to reduce fixed costs)
・to accelerate initiatives on digital transformation
・to review and rebuild customer touchpoints (in response to changes in key sales channels)
・to develop products and services that our customers want to buy for their new lifestyle andto strengthen our capability to address new customer service and sale styles
Consolidated sales for the nine months ended December 31, 2020 were 114.90 billion yen, a decrease of 20.2%
from such sales for the corresponding period of the previous fiscal year due to stay-at-home efforts and temporary closingsof retail stores resulting from the spread of the outbreak, as well as a decrease in the number of customers visiting stores.
On the other hand, sales for the current consolidated third quarter (from October to December) were 41.75 billion yen (adecrease of 2.0% from such sales for the corresponding period of the previous fiscal year). Although the impact of theoutbreak remained, sales significantly recovered (39.7% decrease for the current consolidated first quarter, and 17.6%
decrease for the current consolidated second quarter, respectively from such sales for the corresponding period of theprevious fiscal year), as a result of the absence of decreased demand after the consumption tax increase in Japan during the-2-

previous fiscal year, and the growth of our Peach John Business and Intimates Online Inc. (“Intimates Online”), which we
acquired during the previous fiscal year.
We recorded an operating income of 3.96 billion yen (a decrease of 59.6% from such operating income for thecorresponding period of the previous fiscal year) as a result of our efforts to reduce costs and the use of employment
adjustment subsidy and other government assistance in various countries, despite a significant decrease in revenue.
Operating income for the current consolidated third quarter significantly increased to 2.68 billion yen (an increase of775.8% from such operating income for the corresponding period of the previous fiscal year) as a result of improvement ingross profit rate (an increase of 1.0 point), as well as our continued efforts to reduce costs.
Consolidated income before income taxes and equity in net income of affiliated companies was 10.87 billion yen(a decrease of 30.6% from such consolidated income for the corresponding period of the previous fiscal year) as a result ofrecognition of a valuation gain on marketable securities and investments of 5.73 billion yen, despite an impact of adecrease in operating income.
(Under the U.S. accounting standards that we use, an employment adjustment subsidy is deducted from cost of sales andselling, general and administrative expenses. Equity securities held by the Company and consolidated subsidiaries aremeasured at fair value, and any change from the beginning of the period are recognized as other income (expenses).)
The key exchange rates used for the current consolidated third quarter (previous third quarter) were: 106.11 yen(108.67 yen) to the U.S. dollar; 136.24 yen (137.79 yen) to the Sterling pound; and 15.37 yen (15.90 yen) to the Chinese
yuan.
(ii)

Business Overview of Our Operating Segments*Since the current consolidated cumulative first quarter, information on Ai Co., Ltd., which had previously been
included in our “Wacoal Business (Domestic)” segment, and “Peach John Business” segment, has been included in our“Other” segment following review of certain management classification of performance within our group. In addition,
starting from the current consolidated cumulative second quarter, we have changed our “Peach John Business” to bepresented as a separate operating segment, which had been included in our “Other” segment, because it satisfied thequantitative criteria during the current consolidated cumulative second quarter. The segment information for the previous
consolidated cumulative third quarter has been prepared based on the segments reported for the current consolidated
cumulative third quarter.
(Millions of Yen)
Previous Cumulative
Third Quarter(from April 1, 2019 to
December 31, 2019)
AmountTotal Net Sales
Wacoal Business (Domestic)
Wacoal Business (Overseas)
Peach John Business
Other

Operating Income/(Loss)
Wacoal Business (Domestic)
Wacoal Business (Overseas)
Peach John Business
Other

144,031
82,872
38,1107,865
15,184Current Cumulative
Third Quarter(from April 1, 2020 to
December 31, 2020)

Distribution
Ratio (%)
100.0
57.5
26.5
5.5
10.5

Amount114,901
66,93529,8488,665
9,453

Distribution
Ratio (%)
100.0
58.3
26.0
7.5
8.2

Increased/(Decreased) fromprevious cumulative
third quarter
Amount%(29,130)(15,937)(8,262)+800(5,731)(20.2)(19.2)(21.7)+10.2(37.7)

Previous Cumulative
Third Quarter(from April 1, 2019 to
December 31, 2019)

Current Cumulative
Third Quarter(from April 1, 2020 to
December 31, 2020)

Increased/(Decreased) fromprevious cumulative
third quarter

Amount% to Sales

Amount% to Sales

Amount

%

6.8
8.6
6.9
2.1
-

3,956
3,008
(83)
1,614
(583)

3.4
4.5
18.6
-

(5,845)(4,105)(2,710)+1,446(476)(59.6)(57.7)+860.7
-

9,801
7,113
2,627
168
(107)

-3-

(Reference) Net Sales and Operating Income/ (Loss) of Major Subsidiaries(Millions of Yen)

Net Sales

Previous Cumulative
Third Quarter(from April 1, 2019 to
December 31, 2019)
AmountWacoal Corp.
Wacoal International Corp. (U.S)
Wacoal Europe Ltd.
Wacoal China Co., Ltd.
Peach John Co., Ltd.
Lecien Corporation
Nanasai Co., Ltd.
Ai Co., Ltd.

78,74914,241
9,875
8,288
7,865
4,363
6,480
3,083

Current Cumulative
Third Quarter(from April 1, 2020 to
December 31, 2020)

Distribution
Ratio (%)
54.7
9.9
6.9
5.8
5.5
3.0
4.5
2.1

Amount62,546
12,790
7,027
6,502
8,665
3,430
3,949
1,377

Distribution
Ratio (%)
54.4
11.1
6.1
5.7
7.5
3.0
3.4
1.2

Increased/(Decreased) fromprevious cumulative
third quarter
Amount%(16,203)(1,451)(2,848)(1,786)+800(933)(2,531)(1,706)(20.6)(10.2)(28.8)(21.5)+10.2(21.4)(39.1)(55.3)*Sales to external customers only
(Millions of Yen)

Operating Income/(Loss)

Wacoal Corp.
Wacoal International Corp. (U.S.)
Wacoal Europe Ltd.
Wacoal China Co., Ltd.
Peach John Co., Ltd.
Lecien Corporation
Nanasai Co., Ltd.
Ai Co., Ltd.

Previous Cumulative
Third Quarter(from April 1, 2019 to
December 31, 2019)

Current Cumulative
Third Quarter(from April 1, 2020 to
December 31, 2020)

Increased/(Decreased) fromprevious cumulative
third quarter

Amount% to Sales

Amount% to Sales

Amount

%

6.3
3.4
7.6
8.8
2.1
2.7
-

581
(1,051)
212
483
1,614
149
(299)
(441)

0.9
3.0
7.4
18.6
4.3
-

(4,346)(1,530)(538)(250)+1,446
+311
(476)
(323)

(88.2)(71.7)(34.1)+860.7
-

4,927
479
750
733
168
(162)
177
(118)

*Sales and operating income/(loss) amounts of major subsidiaries are based on the accounting standards in respective countriesa.

Wacoal Business (Domestic)

Sales attributable to our “Wacoal Business (Domestic)” segment were 66.94 billion yen (a decrease of 19.2% ascompared to such sales for the corresponding period of the previous fiscal year) due to decreased revenue in the first halffrom the impact of the spread of the outbreak. Sales for the current consolidated third quarter were 25.90 billion yen (anincrease of 3.2% as compared to such sales for the corresponding period of the previous fiscal year) showing a certain signof recovery. However, our business environment remains difficult due to various factors such as a decrease again in thenumber of customers visiting physical stores, as the number of coronavirus infections has increased since late November.
While operating income decreased due to decreased revenue, we recorded an operating income of 3.01 billion yen(a decrease of 57.7% from such operating income for the corresponding period of the previous fiscal year) as a result of
reduction of costs and the use of an employment adjustment subsidy and other government assistance. Operating income
for the current consolidated third quarter was 2.10 billion yen (an increase of 149.7% from such operating income for thecorresponding period of the previous fiscal year) as a result of our continued efforts to reduce costs, in addition to theimpact of the increased revenue.
Wacoal Corp.:
Sales from Wacoal Corp. decreased by 20.6% as compared to such sales for the corresponding period of theprevious fiscal year due to sales from physical stores weakened by a narrower range of activities available to consumers,
while our e-commerce website maintained high growth. Sales for the current consolidated third quarter increased by 3.0%
as compared to such sales for the corresponding period of the previous fiscal year due to the growth achieved through our
e-commerce website and the absence of decreased demand after the consumption tax increase during the previous fiscal
year, despite the continued impact of the spread of the outbreak.

-4-

Sales from our strategically strengthened e-commerce website increased by 62.7% (an increase of 56.0% for thecurrent consolidated third quarter) as compared to such sales for the corresponding period of the previous fiscal year as aresult of strong sales of our products such as “Night Up Bra”, our sleep bra, in response to the demand from consumers
affected by stay-at-home measures, as well as the positive impact of expanded sales from marketing activities that led tothe acquisition of new customers and redirected our retail store-registered members to our e-commerce website.
On the other hand, although shop sales are showing a sign of recovery, sales from physical stores located in thecenter of the metropolitan areas remained weak due to large-scale efforts to promote remote work, as well as changes in
consumer attitudes and behavior that led to less travel and fewer crowds. While shop sales from department stores anddirectly-managed stores for the current consolidated third quarter were below such sales for the corresponding period of
the previous fiscal year, sales of Wacoal and Wing brand products sold by general merchandise stores in suburbs exceeded
such results for the corresponding period of the previous fiscal year as a result of our successful marketing activities,
including the Black Friday sale.
We completed the installation of our 3D body scanning and AI (artificial intelligence)-based customer service
system at fifteen shops by the end of December 2020. On October 31, we also launched a new customer
experience-focused service for selecting innerwear and new counseling service involving creation of a new work style forour store personnel using avatars.
We recorded an operating income of 0.58 billion yen (a decrease of 88.2% as compared to such operating income
for the corresponding period of the previous fiscal year). While profit from sales substantially decreased due to a decrease
in revenue, we recorded an operating income as a result of improvement in gross profit rate, as well as our efforts to reducelabor costs and expenses. The employment adjustment subsidy of 1.56 billion yen is not included and reflected in thisoperating income, because it is recognized as non-operating income (which has been reclassified as operating income
under the consolidated business results based on the U.S. accounting standards).

b.

Wacoal Business (Overseas)

Sales attributable to our “Wacoal Business (Overseas)” segment on a Japanese yen basis were 29.85 billion yen (adecrease of 21.7% as compared to such sales for the corresponding period of the previous fiscal year) due to temporary
closings of retail stores across the world following the spread of the outbreak, as well as the appreciation of the Japaneseyen (0.67 billion yen). Sales for the current consolidated third quarter were 10.14 billion yen (a decrease of 6.6% ascompared to such sales for the corresponding period of the previous fiscal year) due to sales from Wacoal Europe Ltd.
weakened by the impact of the spread of the outbreak. We recorded an operating loss of 0.08 billion yen (operating incomeof 2.63 billion yen for the corresponding period of the previous fiscal year). This operating loss was due to our continued
strategic marketing investments to achieve rapid growth of Intimates Online, which we acquired during the previous fiscal
year, as well as the impact of decreased revenue, despite our efforts to reduce costs and by using government assistanceprovided by governments across the world. We recorded an operating income of 0.20 billion yen for the current
consolidated third quarter (operating loss of 0.40 billion yen for the corresponding period of the previous fiscal year) as aresult of a decrease in operating loss recorded at Wacoal International Corp. (U.S.).
Wacoal International Corp. (U.S.):
Sales from Wacoal International Corp. (U.S.) on a local currency basis decreased by 8.0% (a decrease of 10.2% on
a Japanese yen basis) as compared to such sales for the corresponding period of the previous fiscal year. Sales for thecurrent consolidated third quarter increased by 10.9% (an increase of 6.6% on a Japanese yen basis) as compared to suchsales for the corresponding period of the previous fiscal year due to an increase of 61.8% in sales recorded at Intimates
Online, which we acquired during the previous fiscal year, as well as an increase of 4.5% in sales recorded at Wacoal
America Inc., which distributes “Wacoal” and “b.tempt’d” brand products, from growth achieved through e-commerce
sales.
The sales from the e-commerce business of Wacoal America Inc. maintained high growth, achieving an increase of
57.1% (an increase of 45.6% for the current consolidated third quarter) from such sales for the corresponding period of theprevious fiscal year. Sales from third-party e-commerce websites were also strong. Sales from physical stores (department
stores), however, were weak due to the impact of our clients’ expense control efforts over purchases, in addition to thetemporary closings following the implementation of lockdown measures and a delay in recovery after the lifting of suchmeasures. Intimates Online maintained high growth, which reflected our successful advertising investments.
We recorded an operating loss of 9.9 million dollars on a local currency basis (1.05 billion yen on a Japanese yenbasis) (operating income of 4.4 million dollars (0.48 billion yen on a Japanese yen basis) for the corresponding period of
the previous fiscal year) due to our continued strategic growth investments in our LIVELY brand distributed by Intimates-5-Online, as well as the impact of the decreased revenue, despite our efforts to reduce costs and the use of government
assistance. Operating loss for the current consolidated third quarter was 1.4 million dollars (0.14 billion yen on a Japanese
yen basis), significantly improving from the corresponding period of the previous fiscal year (an operating loss of 6.1
million dollars (0.67 billion yen on a Japanese yen basis)).
Wacoal Europe Ltd.:Sales from Wacoal Europe Ltd. on a local currency basis decreased by 28.0% (a decrease of 28.8% on a Japanese
yen basis) as compared to such sales for the corresponding period of the previous fiscal year. Sales for the current
consolidated third quarter decreased by 14.2% (a decrease of 15.7% on a Japanese yen basis) as compared to such sales forthe corresponding period of the previous fiscal year due to the significant impact of the lockdown measures implemented
again in the United Kingdom and major counties in Europe, even though sales on a monthly basis for certain months
exceeded the results for the corresponding months of the previous year in some counties or regions due to a temporary
increase in delivery targeting Christmas sales. Sales for the current consolidated third quarter in the United Kingdom,
Europe and North America decreased by 9.1%, 24.9% and 17.8%, respectively. Sales from our e-commerce business,
which we launched in the previous fiscal year, exceeded our plan.
Although operating income on a local currency basis significantly decreased by 71.3% (a decrease of 71.7% on a
Japanese yen basis) due to the impact of decreased revenue, we were able to record profit as a result of our efforts to reduce
costs and use of government assistance.
Wacoal China Co., Ltd.:Sales from Wacoal China Co., Ltd. on a local currency basis decreased by 18.8% (a decrease of 21.5% on a
Japanese yen basis) as compared to such sales for the corresponding period of the previous fiscal year. Although weachieved strong sales from our “Wacoal” brand products at physical stores and our website, sales for the current
consolidated third quarter (from July to September) decreased by 1.0% (an increase of 0.5% on a Japanese yen basis) fromsuch sales for the corresponding period of the previous fiscal year as a result of weak sales from our “Peach John” brandproducts in China.
Although operating income on a local currency basis decreased by 31.9% (a decrease of 34.1% on a Japanese yenbasis) due to the impact of decreased sales, we recorded profit as a result of our efforts to reduce costs and positive effect ofgovernment assistance.
c.

Peach John Business

Sales attributable to our “Peach John Business” segment were 8.67 billion yen (an increase of 10.2% as comparedto such sales for the corresponding period of the previous fiscal year) as a result of our successful marketing activities
based on new product planning that met our consumer needs and promotions that trended on SNS and elsewhere online, as
well as our success in maintaining high growth in sales from our e-commerce website. Sales for the current consolidated
third quarter in Japan increased by 42.6% as compared to such sales for the corresponding period of the previous fiscal year
due to a significant increase in the number of new customers, and sales from our physical stores increased by 6.0% ascompared to such sales for the corresponding period of the previous fiscal year as a result of an improved purchase rate ofcustomers visiting our shops.
We recorded an operating income of 1.61 billion yen, a significant increase from the corresponding period of theprevious fiscal year (0.17 billion yen). This profit was attributable to the positive impact of the increased revenue, theimpact of improved gross profit rate from increased e-commerce sales through our website as a percentage of total sales
and a lower percentage of sales subject to discounts, as well as from rent concessions by the landlords of our offices
following temporary closings of physical stores.
d.

Other

Overall sales attributable to our “Other” business segment were 9.45 billion yen (a decrease of 37.7% as comparedto such sales for the corresponding period of the previous fiscal year), while we recorded an operating loss of 0.58 billion
yen (operating loss of 0.11 billion yen for the corresponding period of the previous fiscal year).
Lecien Corporation:
Sales from Lecien Corporation decreased by 21.4% as compared to such sales for the corresponding period of theprevious fiscal year due to the weak sales of our private products sold by general merchandise stores and specialty stores,
which were impacted by our clients’ expense control efforts over purchases. We recorded an operating income of 0.15
billion yen (as compared to operating loss of 0.16 billion yen for the corresponding period of the previous fiscal year) due-6-to our efforts to withdraw from underperforming businesses in the fourth quarter of the previous fiscal year and to reduce
costs.
Nanasai Co., Ltd.:Sales from Nanasai Co., Ltd. decreased by 39.1% as compared to such sales for the corresponding period of theprevious fiscal year due to our construction business weakened by the cancellation and postponement of new shop
openings and various events following the spread of the outbreak. We recorded an operating loss of 0.30 billion yen (ascompared to operating income of 0.18 billion yen for the corresponding period of the previous fiscal year) due to decreased
revenue, despite our efforts to reduce costs.
Ai Co., Ltd.:Sales from Ai Co., Ltd. decreased by 55.3% as compared to such sales for the corresponding period of the previous
fiscal year due to sales of our resort wear (swimwear) weakened by less travel by people and beach closures following the
spread of the outbreak. We recorded an operating loss of 0.44 billion yen (as compared to operating loss of 0.12 billion yen
for the corresponding period of the previous fiscal year) due to a significant decrease in revenue, despite our efforts to
reduce costs.
(2)

Qualitative Information regarding Consolidated Financial Condition(i)

Assets, Liabilities and Total Shareholders’ Equity

Our total assets as of the end of the current consolidated third quarter were 314,471 million yen, an increase of
36,783 million yen from the end of the previous fiscal year, mainly due to an increase in cash and cash equivalents in effort
to ensure liquidity on hand.
Our total liabilities were 104,799 million yen, an increase of 36,559 million yen from the end of the previous fiscal
year, mainly due to increases in short-term bank loans for reasons similar to those discussed with respect to assets.
Total Wacoal Holdings Corp. shareholders’ equity was 206,481 million yen, an increase of 1,110 million yen fromthe end of the previous fiscal year, due to recognition of net income and changes in foreign currency translation
adjustments.
As a result of the above, our total shareholders’ equity ratio as of the end of the current consolidated third quarter
was 65.7%, a decrease of 8.3% from the end of the previous fiscal year.
(ii)

Cash Flows

Cash and cash equivalents as of the end of the consolidated third quarter of the current fiscal year were 62,425
million yen, an increase of 34,520 million yen from the end of the previous fiscal year.
(Cash Flow Provided by Operating Activities)
Cash flow provided by operating activities was 2,734 million yen, a decrease of 10,285 million yen as compared tothe corresponding period of the previous fiscal year, after adjustments for changes in assets and liabilities to our net incomeof 4,816 million yen plus adjustments for depreciation expenses and deferred taxes.
(Cash Flow Used in Investing Activities)
Cash flow used in investing activities was 2,718 million yen, an increase of 1,888 million yen as compared to thecorresponding period of the previous fiscal year, due to capital expenditures and payments to acquire intangible assets.
(Cash Flow Provided by Financing Activities)
Cash flow provided by financing activities was 34,754 million yen, as compared to cash outflow of 14,067 million
yen for the corresponding period of the previous fiscal year, due to procurement of short-term bank loans and long-term
debts, despite cash outflow including payments made for dividends as well as payments made to acquire interests in
subsidiaries from holders of noncontrolling interests and contingent consideration.

-7-

(3)

Qualitative Information regarding Forecast of Consolidated Business Results
Although we have not revised our forecast of consolidated business results for the fiscal year ending March 31,

2021, which were previously announced on October 30, 2020, significant uncertainties remain, as the impact of the spreadof the outbreak prolongs. We will disclose our revised forecast promptly if we determine that the current forecast needs tobe revised. (The impact of the change in the valuation loss or gain on marketable securities and investments to our businessresults is not reflected in the forecast.)

-8-

2.

Consolidated Quarterly Financial Statements and Accompanying Notes(1)

Consolidated Quarterly Balance SheetsI.

Accounts

Previous Fiscal Year
as of March 31, 2020

(Assets)

Millions of Yen

Current Consolidated
Third Quarteras of December 31, 2020
Millions of Yen

Increase/(Decrease)
Millions of Yen

Current assets:
Cash and cash equivalents
Time deposits
Marketable securities

27,90562,42534,520

797

1,336

539

656

520

(136)

Notes and accounts receivable

20,062

19,311(751)

Allowance for doubtful receivables
Inventories(489)
43,427(449)

40

42,178(1,249)

868

792

(76)

4,964

7,383

2,419

98,190133,49635,306

Land

21,46020,793(667)

Buildings and structures

74,03973,707(332)

Machinery and equipment

18,782

18,923141

Return assets
Other current assets
Total current assets
II. Property, plant and equipment:

Construction in progress

1,090

1,224

134

115,371

114,647(724)(63,288)(64,065)(777)

52,08350,582(1,501)

Operating leases right-of-use assets

13,54011,998(1,542)

Investments in affiliated companies

21,59520,744(851)

Investments

43,904

48,361

4,457

Goodwill

22,371

22,330(41)

Other intangible assets

14,547

14,58639

Prepaid pension expense

4,974

5,368

394

Deferred income taxes

1,118

1,436

318

Other

5,366

5,570

204

127,415130,393

2,978

277,688314,471

36,783

Accumulated depreciation
Net property, plant and equipment
III. Other assets:

Total other assets
Total assets

-9-

I.

Accounts

Previous Fiscal Year
as of March 31, 2020

(Liabilities)

Millions of Yen

Current Consolidated
Third Quarteras of December 31, 2020
Millions of Yen

Increase/(Decrease)
Millions of Yen

Current liabilities:
Short-term bank loans

3,364

41,57538,211

Trade notes payable

1,112

905

(207)

Trade accounts payable

9,588

7,791

(1,797)

Notes and accounts payable:

Other payables

7,107

5,487

(1,620)17,807

14,183(3,624)

Accrued payroll and bonuses

6,734

5,471

(1,263)

Income taxes payable

4,878

3,888

(990)

Refund liability

2,645

2,912

267

Short-term operating lease liabilities

4,600

4,182

(418)

Contingent consideration (short-term)

-

1,035

1,035

4,079

6,636

2,557

44,10779,88235,775

Other current liabilities
Total current liabilities
II. Long-term liabilities:
Long-term debt
Liability for termination and retirement
benefits
Deferred income taxes

35

1,419

1,384

2,069

2,052

(17)

7,911

9,600

1,689

Long-term operating lease liabilities

9,101

7,999

(1,102)

Contingent consideration(long-term)

2,786

1,615

(1,171)Other long-term liabilities

2,231

2,232

1

Total long-term liabilities

24,13324,917784

Total liabilities

68,240104,799

36,559(Equity)I.

13,26013,260-

II. Additional paid-in capital

Common stock

29,83629,136(700)

III. Retained earnings

185,233

179,302(5,931)(1,033)(2,180)(1,147)Pension liability adjustments(4,594)(4,124)470

V. Treasury stock, at cost
Total Wacoal Holdings Corp.
shareholders’ equity
VI. Noncontrolling interests(17,331)(8,913)

8,418

205,371

206,481

1,110

4,077

3,191

(886)

Total equity

209,448

209,672

224

Total liabilities and equity

277,688314,471

36,783

IV. Accumulated other comprehensive loss:
Foreign currency translation adjustments- 10 -

(2)Consolidated Quarterly Statements of Income

Accounts

I.

Net Sales

Previous Consolidated
Cumulative Third Quarter(From April 1, 2019
to December 31, 2019)
Millions of Yen%

Current Consolidated
Cumulative Third Quarter(From April 1, 2020
to December 31, 2020)
Millions of Yen%

Increase/(Decrease)
Millions of Yen

144,031100.0

114,901

100.0(29,130)

Cost of sales

63,91544.4

50,27943.8(13,636)

Selling, general and administrative expenses

70,31548.8

60,66652.8(9,649)Total operating costs and expenses

134,23093.2

110,94596.6(23,285)

9,801

6.8

3,956

3.4

(5,845)

II. Operating costs and expenses:

Operating income
III. Other income (expenses):
Interest income

167

52

(115)

Interest expense

(17)

(56)

(39)

Dividend income
Valuation gain on marketable securities andinvestments – net
Other – net

1,452

1,078

(374)

4,486

5,725

1,239

Total other income
Income before income taxes and equity in net
income of affiliated companies
Income taxes
Income before equity in net income of affiliatedcompanies
Equity in net income of affiliated companies

5,868

4.1

6,917

6.1

1,049

15,66910.9

10,873

9.5(4,796)

4,887

3.4

6,506

5.7

1,619

10,782

7.5

4,367

3.8

(6,415)

342

0.2

449

0.4

107

11,124

7.7

4,816

4.2

(6,308)

(110)

(0.1)

156

0.1

266

11,014

7.6

4,972

4.3

(6,042)

Net income
Net loss (income) attributable to noncontrollinginterests
Net income attributable to Wacoal Holdings
Corp.

(3)

(220)

118

338

Consolidated Quarterly Statements of Comprehensive Income

Accounts

I. Net income
II. Other comprehensive income (loss)- net of tax:
Foreign currency translation adjustments

Previous Consolidated
Cumulative Third Quarter(From April 1, 2019
to December 31, 2019)
Millions of Yen

Current Consolidated
Cumulative Third Quarter(From April 1, 2020
to December 31, 2020)
Millions of Yen

Increase/(Decrease)
Millions of Yen

11,124

4,816(6,308)(1,529)(1,343)

186

Pension liability adjustments

617

470

(147)

Other comprehensive income (loss)

(912)

(873)

39

10,212

3,943(6,269)

(142)

352

494

10,0704,295(5,775)Comprehensive income
Comprehensive loss (income) attributable tononcontrolling interests
Comprehensive income attributable to
Wacoal Holdings Corp.

- 11 -

(4)Consolidated Quarterly Statements of Cash Flows

Accounts

Previous Consolidated Cumulative
Third Quarter(From April 1, 2019
to December 31, 2019)
Millions of Yen

I. Operating activities
1. Net income
2. Adjustments to reconcile net income to net cash provided
by operating activities(1) Depreciation and amortization(2) Allowance for doubtful receivables - net(3) Deferred income taxes(4) (Gain) loss on sales or disposal of property, plant andequipment - net(5) Impairment charges on property, plant and equipment(6) Valuation gain on marketable securities and investments– net(7) Equity in net income of affiliated companies,
less dividends received(8) Changes in assets and liabilities
Decrease in notes and receivable
Decrease(increase) in inventories
Decrease(increase) in return assets(Increase)decrease in other current assets
Decrease in notes and accounts payable
Increase in refund liability
Increase in liability for termination and retirement
benefits
Increase in other liabilities(9) Other
Net cash provided by operating activities
II.
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.

Investing activities
Increase in time deposits
Decrease in time deposits
Proceeds from sales and redemption of equity securities
Payments to acquire equity securities
Proceeds from redemption of debt securities
Proceeds from sales of property, plant and equipment
Capital expenditures
Payments to acquire intangible assets
Payments for loans
Acquisition of new subsidiaries (net of cash acquired)
Other
Net cash used in investing activities

III. Financing activities
1. Net increase (decrease) in short-term bank loans withoriginal maturities of three months or less
2. Procurement of short-term loan (over 3 months)
3. Procurement of long-term debt
4. Repayment of long-term debt
5. Repurchase of treasury stock
6. Dividends paid on common stock
7. Dividends paid to noncontrolling interests
8. Proceeds from stock issuance to noncontrolling interests
9. Payments to acquire interests in subsidiaries fromnoncontrolling interests
10. Contingent consideration payment
Net cash provided by (used in) financing activities
IV. Effect of exchange rate changes on cash and cash
equivalents
V. Net increase (decrease) in cash and cash equivalents
VI. Cash and cash equivalents, beginning of period
VII. Cash and cash equivalents, end of period- 12 -

Current Consolidated Cumulative
Third Quarter(From April 1, 2020
to December 31, 2020)
Millions of Yen

11,124

4,816

4,409
26
(1,505)

4,558
(12)
1,211

49

(361)

-

625

(4,486)(5,725)

199

96

4,358
(1,790)(202)
163(2,445)
268

647
1,115
76
(2,444)(2,700)
267

727

276

1,771
353
13,019

299
(10)
2,734

(473)
3,534
10,291(262)
326
94(2,582)(2,591)(9,181)
14
(830)

(857)
291
940
(6)
424
646
(1,699)(2,169)(315)
27(2,718)(4,053)

17,747(38)(5,001)(4,907)(184)
116

20,424
1,447
(35)
(1)
(2,496)(81)--(1,190)(14,067)(1,061)34,754

(370)

(250)

(2,248)30,133
27,88534,52027,90562,425

Additional Cash Flow Information
Previous Consolidated Cumulative
Third Quarter(From April 1, 2019
to December 31, 2019)

Accounts
Cash paid for:
Interest
Income taxes
Noncash investing activities
Acquisition of new subsidiaries (contingent
consideration)
Acquisition of fixed assets by assuming payment
obligation(5)

Current Consolidated Cumulative
Third Quarter(From April 1, 2020
to December 31, 2020)

18
4,633

46
8,417

4,173

-

521

1,088

Notes to Consolidated Quarterly Financial Statements(Notes on Going Concern)
Not applicable.
(Notes on Significant Changes in the Amount of Total Shareholders’ Equity)
Not applicable.
(Segment Information)(i)

Operating Segment Information

Previous Consolidated Cumulative Third Quarter (From April 1, 2019 to December 31, 2019)(Millions of Yen)
Wacoalbusiness(Domestic)

Wacoalbusiness(Overseas)

Peach Johnbusiness

82,872

38,110

7,865

Other

Total

Elimination

15,184

144,031-

Consolidated

Net sales(1) External customers(2) Intersegment

144,031

901

8,444

541

3,877

13,763(13,763)-

Total

83,77346,554

8,406

19,061

157,794(13,763)

144,031

Operating income (loss)

7,113

2,627

168

(107)

9,801

-

9,801

Current Consolidated Cumulative Third Quarter (From April 1, 2020 to December 31, 2020)(Millions of Yen)
Wacoalbusiness(Domestic)

Wacoalbusiness(Overseas)

Peach Johnbusiness

66,93529,848

8,665

9,453

114,901-

114,901

590

6,990

456

2,886

10,922(10,922)-

Total

67,52536,8389,121

12,339125,823(10,922)

114,901

Operating income (loss)

3,008

(83)

1,614

(583)

3,956

-

3,956

Net sales(1) Externalcustomers(2) Intersegment(Note)

Other

Total

Elimination

Consolidated

1.

Core products of respective businesses:
Wacoal business (Domestic): innerwear (foundation, lingerie, nightwear and children’s innerwear), outerwear, sportswear,
hosiery, etc.
Wacoal business (Overseas): innerwear (foundation, lingerie, nightwear and children’s innerwear), outerwear, sportswear,
other textile-related products, etc.
Peach John business:
innerwear (foundation, lingerie and nightwear), outerwear, and other textile-related products,
etc.
Other:
innerwear (foundation, lingerie, nightwear and children’s innerwear), outerwear, sportswear,
other textile-related products, mannequins, construction of stores and interior design, etc.

2.

Matters regarding Changes to Operating Segments:
Starting from the current consolidated first quarter, information on Ai Co., Ltd., which was previously presented in our “Wacoal
Business (Domestic)” segment and “Peach John Business” segment, is now reflected and presented in our “Other” segment- 13 -

following review of certain management classification of performance within our group.
As a result of our assessment on quantitative criteria, “Peach John Business”, which had been previously presented in our“Other” segment, has satisfied the criteria and accordingly has been presented as a separate operating segment from the current
consolidated second quarter. The segment information for the previous consolidated cumulative third quarter has been preparedbased on the segments reported after this change.
3.

(ii)

Information on Assets by Operating Segment:
Assets attributable to our “Wacoal Business (Domestic)” segment increased by 42,458 million yen from the end of the previous
fiscal year as a result of loans borrowed during the current consolidated third quarter. Accordingly, assets attributable to our“Wacoal Business (Domestic)” segment as of the end of the current consolidated third quarter were 279,852 million yen.

Segment Information by Region

Previous Consolidated Cumulative Third Quarter (From April 1, 2019 to December 31, 2019)(Millions of Yen)

Net sales
External customers
Distribution ratio
Operating income

Japan

Asia/Oceania

Europe/N.A.

Consolidated

105,18873.0%

15,74010.9%

23,10316.1%

144,031100.0%

7,252

1,460

1,089

9,801

Current Consolidated Cumulative Third Quarter (From April 1, 2020 to December 31, 2020)(Millions of Yen)

Net sales
External customers
Distribution ratio

Japan

Asia/Oceania

Europe/N.A.

Consolidated

84,38073.5%

11,412
9.9%

19,10916.6%

114,901
100.0%

(635)

3,956

Operating income (loss)
4,076
515
(Note) 1. Countries or areas are classified according to geographical proximity.
2. Main countries and areas belonging to classifications other than Japan:
Asia/Oceania: Asian countries and Australia
Europe/N.A.: North America and European countries
3. Sales in respect of consolidated companies are categorized by location.

(6)

Status of Sales

Type of productFoundationand lingerie
Innerwear Nightwear
Children’s
underwear
Subtotal
Outerwear/Sportswear
Hosiery
Other textile goods andrelated products
Other
Total

Previous Consolidated Cumulative
Third Quarter(From April 1, 2019 to
December 31, 2019)
AmountDistribution Ratio
Millions of Yen%

Current Consolidated Cumulative
Third Quarter
Increase/(Decrease)(From April 1, 2020 to
December 31, 2020)
AmountDistribution Ratio
AmountRatio
Millions of Yen%
Millions of Yen%

111,667

77.5

92,49980.5(19,168)(17.2)

5,915

4.1

5,155

4.5

(760)

(12.8)

834

0.6

574

0.5

(260)

(31.2)

118,416

82.2

98,22885.5(20,188)(17.0)

9,970
1,290

6.9
0.9

6,694
774

5.8
0.7

(3,276)(516)(32.9)(40.0)

5,903

4.1

4,104

3.6

(1,799)(30.5)

8,452
144,031

5.9
100.0

5,101
114,901

4.4
100.0(3,351)(29,130)(39.6)(20.2)- 14 -