Results Briefing Summary
Sales and profits rise year on year,
1H profits reach a record-high◆ Summary of 1H FY3/21 Consolidated Results
2Q FY3/20
Consolidated(\ million)
Actual2Q FY3/21

Composition
ratio

ActualYoY

Composition
ratio

ChangeReference

Pct. Change

5/8/20forecast

ChangePct. Change

48,313100.0%

50,189100.0%

1,876

3.9%

42,000

8,189

19.5%

Product Development
Model Business

23,49648.6%

26,164

52.1%

2,668

11.4%

21,400

4,764

22.3%

Wholesale
Model Business

23,00047.6%

21,78443.4%(1,215)-5.3%

19,0002,78414.7%

Others

1,817

3.8%

2,240

4.5%

423

23.3%

1,600

640

40.1%

Gross profit

13,64728.2%

15,501

30.9%

1,854

13.6%

12,050

3,451

28.6%

SG&A expenses

10,522

21.8%

10,298

20.5%

(224)

-2.1%

9,800

498

5.1%

Operating income

3,124

6.5%

5,203

10.4%

2,078

66.5%

2,250

2,953

31.3%

Ordinary income

3,156

6.5%

5,322

10.6%

2,166

68.6%

2,350

2,972

26.5%

Net income

2,138

4.4%

3,586

7.1%

1,448

67.7%

1,550

2,036

31.4%

Net sales*Due to a change in internal management approach from 1Q FY3/21, some operations previouslyclassified under the Product Development Model Business have been transferred to the Wholesale ModelBusiness; segment figures for FY3/20 are shown based on the new approach.
For the first half of FY3/21, Doshisha reported higher sales and profits year on year and record-high profits.
Start-of-year forecasts were also achieved. Consolidated results for 1H are as follows: net sales ¥50,189
million (up 3.9% year on year), gross profit ¥15,501 million (up 13.6%), selling, general and administrative
expenses ¥10,298 million (down 2.1%), operating income ¥5,203 million (up 66.5%), ordinary income¥5,322 million (up 68.6%), and net income ¥3,586 million (up 67.7%).
The gross profit margin rose to 30.9%, which was higher than the start-of-year forecast and also a newrecord for Doshisha, reflecting an increase in the sales weighting for products developed in-house. In
selling, general and administrative expenses, distribution costs were steady year on year, mainly due tothe smooth startup of the Kisarazu Logistics Center and progress with adjusting distribution methods. Inaddition, expenses related to marketing activities such as travel expenses, advertising expenses and sales
promotion expenses were contained due to measures to prevent the spread of COVID-19. As a result, theselling, general and administrative expenses ratio declined 1.3 percentage points year on year to 20.5%,
which was 2.8 percentage points lower than the start-of-year forecast.
< Summary of segment sales versus start-of-year forecasts >Compared with start-of-year forecasts, sales in the Product Development Model Business were ¥4,764

million higher than projected (22.3% above forecast).
Sales of living storage products were strong, supported by firm demand for desks and chairs for teleworkand home working and healthy sales of the Luminous Club range of steel racks for room organization.
Online sales also rose sharply, including via the Doshisha online sales portal. In homewares, the business
reported higher sales of products designed to prevent heat exhaustion and improve ventilation, such as
circulators and personal fans that can be worn around the neck. Sales of small desktop fans for teleworkenvironments also increased. In addition, sales of hotplates and other cooking appliances rose amid
increased demand for eating at home. Other popular items included the long-selling evercook frying pans,
which are easy to clean, and reusable eco-bags, which were launched after Japanese retailers started
charging for plastic bags at checkout.
Sales in the Wholesale Model Business were ¥2,784 million higher than projected (14.7% above forecast).
Sales of famous brands declined year on year, reflecting a slump in demand for fashion accessories andother accessories amid the closure of specialist retailers and a drop in the number of people going out due
to the shift to teleworking and working from home. However, the business registered higher sales of facemasks and antibacterial products in beauty and cosmetics products, and increased sales of wearable
devices and smartwatches in wristwatches. In gifts, sales of mid-year assorted gift packs declined year onyear, reflecting a reduction in event sales space and a lack of maintenance work on sales areas due tomeasures to control the spread of COVID-19. However, segment profits increased year on year thanks totighter inventory control, which led to a reduction in product disposal costs after the gift-giving season
ended. In everyday merchandise, which mainly comprises products sold on a spot basis, the businessused the Doshisha Group’s extensive network of suppliers and retailers to rapidly source and sell products
in high demand, leading to higher sales of antibacterial spray, face masks and plastic gloves.

◆ Summary of 1H FY3/21 Consolidated Results by Business Segment
Our operations are largely divided into two business segments: the Product Development Model Businessand the Wholesale Model Business. The Product Development Model Business plans, manufactures andsells original Doshisha products. The Wholesale Model Business is a comprehensive sales proposal
business, mainly focused on selling and planning sales promotions for leading domestic and overseas
brands and products sourced from major manufacturers in Japan. The product range in the Wholesale
Model Business includes well-known brand watches, bags and other items, traditional mid-year andyear-end assorted gift packs arranged by Doshisha using merchandise sourced from leading domestic
suppliers, and national brand (NB) processed products.

(¥ billion)

Product Development
Model Business

Wholesale
Model BusinessFamousbrands

NB
processing

Others60.0* Figures in ( ) are composition ratio
Figures in [ ] are year on year change

48.3 [-0.3%]

48.4

40.0

24.5

0.0

[-4.4%]

6.3(12.6%)[-26.8%][-1.9%]

23.0
13.5(47.6%)(28.0%)[+2.7%]End of 2Q FY3/19(52.1%)[+11.4%](17.9%)(18.2%)

22.3(48.6%)

8.6

8.8(46.2%)

26.1

23.4(50.7%)

20.0

50.1 [+3.9%]

14.3

21.7(43.4%)(29.7%)[-5.3%]

15.4(30.8%)[+5.7%][+7.7%]End of 2Q FY3/20

End of 2Q FY3/21*Due to a change in internal management approach from 1Q FY3/21, some operations previouslyclassified under the Product Development Model Business have been transferred to the Wholesale Model
Business; segment figures for FY3/20 are shown based on the new approach.

◆ 1H FY3/21 Consolidated Results by Sales Channel
Sales in the hardware store channel increased 14% year on year, supported by firm sales of desks andchairs for telework and home working, steel storage racks, and handheld and compact fans. In thediscount store retailer channel, sales were up 3% year on year on strong demand for face masks,
antibacterial products and everyday merchandise, which outweighed lower sales of luxury brand products.
Sales in the online channel, including the Doshisha B2C website, rose 6% year on year. Sales growth was
supported by stay-at-home demand for products such as desks and chairs, storage products, snow conemakers, frying pans and fans. Sales also increased in the single-price retailer channel, rising 7% year onyear on strong demand for products that help to prevent infection, such as reusable eco-bags, face masks,
disinfectant and plastic gloves. However, sales in the large electronics retailer channel fell 29% year onyear due to store closures. Similarly, sales declined 42% year on year in the specialist watch and clothing
store channel, reflecting a large slump in sales of discretionary products such as foreign brand watches
and fashion accessories.

◆ Consolidated Forecasts for FY3/21
FY3/20FY3/21

Versus start-of-year forecasts

YoY

Consolidated(\ million)

1H

2H

Full year

ChangePct.
ChangeFull yearChange

Pct.
Change96,23850,18950,810101,000

4,761

4.9%

92,000

9,000

9.8%

23,58147,07826,164

27,63553,800

6,721

14.3%

47,000

6,800

14.5%

23,00022,17545,17521,784

21,11542,900(2,275)-5.0%

41,100

1,800

4.4%

Others

1,817

2,167

3,984

2,240

2,059

4,300

315

7.9%

3,900

400

10.3%

Gross profit

13,647

13,05926,706

15,501

14,44829,950

3,243

12.1%

26,000

3,950

15.2%

SG&A expenses

10,522

10,18820,711

10,298

11,051

21,350638

3.1%

20,700650

3.1%Operating income

3,1242,870

5,995

5,203

3,396

8,600

2,604

43.4%

5,300

3,300

62.3%

Ordinary income

3,156

3,104

6,260

5,322

3,477

8,800

2,539

40.6%

5,500

3,300

60.0%

Net income

2,138

2,073

4,211

3,586

2,313

5,900

1,688

40.1%

3,650

2,250

61.6%

1H

2H

Net sales

48,31347,924

Product Development
Model Business

23,496Wholesale
Model Business

Full year*Due to a change in internal management approach from 1Q FY3/21, some operations previouslyclassified under the Product Development Model Business have been transferred to the Wholesale ModelBusiness; segment figures for FY3/20 are shown based on the new approach.
On 30 October, 2020, we revised up our start-of-year forecasts for FY3/21 to factor in 1H FY3/21 results.
Our new forecasts, which call for stronger sales and profit growth, are as follows:
Net sales: ¥92 billion → ¥101.0 billion (up 4.9% year on year)
Gross profit: ¥26 billion → ¥29.95 billion (up 12.1%)
Selling, general and administrative expenses: ¥20.7 billion → ¥21.35 billion (up 3.1%)
Operating income: ¥5.3 billion → ¥8.6 billion (up 43.4%)
Ordinary income: ¥5.5 billion → ¥8.8 billion (up 40.6%)
Net income: ¥3.65 billion → ¥5.9 billion (up 40.1%)
Our new segment sales forecasts are as follows:
Product Development Model Business: ¥47.0 billion → ¥53.8 billion (up 14.3% year on year)
Wholesale Model Business: ¥41.1 billion → ¥42.9 billion (down 5.0%)◆ Business Strategy for 2H FY3/21< Product Strategy: A product lineup that never gets boring – responsive x rapid >In the second half of the fiscal year, we will continue to focus on rapidly sourcing and developing productsthat address changes in the market amid continued uncertainty caused by the COVID-19 outbreak. Thisresponsive and rapid approach is anchored by three strengths:(1) Agile buying power through cash-based procurement(2) A “fabless manufacturer” with 2,100 suppliers(3) Production system that ensures quality
These strengths allow us to rapidly procure, plan and develop products that meet the needs of consumers
and the market, underpinning sales relationships with 4,800 companies across every retail format.

Strategy (1) Responsive x Rapid
Stay-at-homedemand
Ceiling circulator
that improvesventilation and heating
efficiency, ideal for
winter as well!

Health & hygiene
New standard in cold protection
Scarves, waistcoats andother clothing with embedded
electric heaters

New etiquette
Proprietary brandFurbo / Rubin Rosa
face mask cases

Indoor air filtration productsFitted with Cleverin LEDs
from Taiko Pharma
Humidifier, sterilizer-deodorizer
device, futon dryer

Health management withwearable devices andsmartwatches
SUUNTO / fitbit / GARMIN / GoBe

evercook pro frying pan
Top model in the evercook range;
super-easy cleanup
Average annual sales for the rangeof 700,000 units
Colored tumblers thatkeep hot or cold drinks
at the right temperature
Ideal for offices orhome working

Hardware stores
Interior shelving & desks

Easy to assemble with designs tomatch any interior

Luminous Club steel
storage racks
Top market share

Office chairs that
improve posture< Product Strategy: A product lineup that never gets boring – solutions x value chain >Japan’s traditional mid-year and year-end gift market is gradually contracting due to changing customs,
including adjustments in corporate gift-giving demand. The changes have the potential to undermine
profitability at stores and retailers due to higher cost burdens in each part of the value chain, frommerchandising and inventory management to sales area development, sales promotion planning and giftordering processes.
In response, from FY3/21, we started offering complete optimization packages drawing on our track recordand expertise in the gift business across all retail channels. We help clients plan products tailored to
specific stores and regions, provide sell-out support covering sales area development through to sales
promotion planning, and provide efficient order processing on a contract basis. These packages are awin-win for customers and Doshisha: they help stores improve profitability by reducing costs and effort,
and they help us increase earnings through gains in market share.

Strategy (2) Solutions x Value Chain
Gift Business: Resolving issues with optimization proposals– win-win for customers and Doshisha

Product PlanningStores / Sales
Areas

Order Processing＜ Burdens / concerns of retailers with partial outsourcing ＞• Issues with productplanning andprocurement• Issues with managingsuppliers• Lack of sales areaideas• Issues withinventory
management• Significant
workload in ordermanagement(Headcount andcost increases)

Partialoptimization
limits flexibility
and leads tolosses＜ Full optimization by Doshisha draws on product planning / sales area expertise from other sectors ＞• Reduced
inventory risk
• Optimal productlineup• Sales area
development• Sell-out support• All processes
outsourced toDoshisha⇒Improved
efficiency

One-stop full
optimization
leads to profits

In the second half of FY3/21, our sales channel strategy is focused on strengthening the online channeland reinforcing other channels by offering exclusive products and OEM products.

◆ FY3/21 Dividend Policy
Our goal is to continue paying stable dividends to shareholders. We plan to pay a full-year dividend of ¥50
per share for FY3/21.
(November 11, 2020, Tokyo)