Consolidated Financial Statements for the Fiscal Year Ended March 31, 2021 (U.S. Accounting Standards)[Translation]
May 14, 2021
Listed Company: Wacoal Holdings Corp.
Stock Exchanges: Tokyo (1st section)
Code Number: 3591 URL: http://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) Katsuya Hirooka Tel: +81 (075) 682-1010
Scheduled date of Ordinary Shareholders’ Meeting: June 29, 2021
Scheduled Commencement Date of Dividend Payment: June 4, 2021
Scheduled date of Annual Securities Report Filing: June 29, 2021
Supplementary materials regarding Annual Business Results: Yes
Explanatory meeting regarding Annual Business Results: Yes (for institutional investors and analysts)(Amounts less than 1 million yen have been rounded.)1.

Consolidated Results for the Fiscal Year Ended March 31, 2021 (April 1, 2020 – March 31, 2021)(1) Consolidated Business Results(% indicates changes from previous fiscal year)

Net Sales

Fiscal Year Ended March 31, 2021
Fiscal Year Ended March 31, 2020
(Note) Comprehensive income:Operating Income

Income Before Income
Taxes and Equity in Net
Income of AffiliatedCompanies

Net Income
Attributable to Wacoal
Holdings Corp.

Millions of Yen %Millions of Yen %Millions of Yen %152,204 (18.5)(1,115)
10,792
147.6
186,760 (3.8)
6,632
35.9
4,359
97.9
Fiscal Year ended March 31, 2021: 13,043 million yen (757.5%)
Fiscal Year ended March 31, 2020: 1,521 million yen (- %)Millions of Yen %7,025 102.3
3,472 918.2

Ratio of Income
Before Income
Ratio of Net Income
Net Income
Diluted Net Income
Taxes andAttributable toAttributable toAttributable toEquity in Net
Wacoal Holdings
Wacoal Holdings
Wacoal Holdings
Income ofCorp. toCorp. Per ShareCorp. Per Share
AffiliatedShareholders’ Equity
Companies toTotal Assets
Yen
Yen
%
%
Fiscal Year Ended March 31, 2021
112.57112.09
3.3
3.6
Fiscal Year Ended March 31, 2020
54.26
54.05
1.6
1.6
(Reference) Equity in net income of affiliated companies:
Fiscal Year ended March 31, 2021: 93 million yen
Fiscal Year ended March 31, 2020: 62 million yen

Ratio of
Operating
Income to Net
Sales

%
(0.7)
3.6

(2) Consolidated Financial Condition

Total Assets

Fiscal Year Ended March 31, 2021
Fiscal Year Ended March 31, 2020

Total Equity(Net Assets)

Millions of Yen Millions of Yen
322,761
218,616
277,688
209,448

Total Shareholders’ Total Shareholders’EquityEquity Ratio
Millions of Yen
215,612205,371

%
66.8
74.0

Shareholders’EquityPer ShareYen
3,454.18
3,291.06(3) Consolidated Cash Flow Status

Fiscal Year Ended March 31, 2021
Fiscal Year Ended March 31, 2020

Cash Flow provided Cash Flow provided by Cash Flow provided by Balance of Cash and Cashby Operating(used in) Investing(used in) Financing
Equivalents at End of Fiscal
Activities
Activities
Activities
Year
Millions of Yen
Millions of Yen
Millions of Yen
Millions of Yen
4,260(2,562)33,60563,557
13,325
2,569(17,471)
27,905-1-

2.

Status of Dividends

Annual Dividend

Fiscal Year Ended March 31, 2020
Fiscal Year Ended March 31, 2021
Fiscal Year Ending March 31,
2022 (Estimates)3.

End ofFirst
Quarter

End ofSecondQuarter

End ofThird
QuarterYear-end

Annual

Yen

Yen

Yen

Yen

Yen

-

40.00
20.00
20.00

-

20.00
20.00
30.00

60.00
40.00
50.00

Total
Amount ofDividends(annual)Millions of
Yen
3,808
2,496

Payout Ratio(consolidated)

Ratio of
Dividend to
Shareholders’Equity(consolidated)

%

%

110.6
35.5
56.7

1.8
1.2

Forecast of Consolidated Results for the Fiscal Year Ending March 31, 2022 (April 1, 2021 – March 31, 2022)

Net Sales

AnnualMillions of Yen %184,000 20.9(% indicates changes from the previous fiscal year)
Income Before
Income Taxes andNet Income
Net Income
Equity in Net
Attributable toAttributable toOperating Income
Income of
Wacoal Holdings
Wacoal Holdings
AffiliatedCorp.
Corp. Per Share
Companies
Millions of Yen %Millions of Yen %Millions of Yen %
Yen
6,000
7,900
(26.8)
5,500(21.7)
88.11-2-

*Notes(1) Changes in significant subsidiaries during the fiscal year ended March 31, 2021 (change in scope of consolidation): None
New: None
Excluded: None
(Note) For details, please see “3. Consolidated Financial Statements and Accompanying Notes (7) Basic Significant Matters in
Preparation of Consolidated Financial Statements” on page 20.
(2) Changes in Accounting Principles:(i) Changes due to modifications in accounting standards, etc.: None(ii) Changes other than (i) above: None
(3) Number of Issued Shares (Common Stock)

(i)
(ii)
(iii)

Number of issued shares (including treasury stock) as of period-end:
Number of shares held as treasury stock as of period-end:
Average number of shares during the period:

Fiscal Year Ended
March 31, 2021
65,589,042 shares
3,168,353 shares
62,406,826 sharesFiscal Year Ended
March 31, 2020
68,589,042 shares
6,186,410 shares
63,989,561 shares(Reference) Summary of Non-consolidated Results1.

Non-consolidated Results for the Fiscal Year Ended March 31, 2021 (April 1, 2020 – March 31, 2021)(1) Non-consolidated Business Results

Fiscal Year Ended March 31, 2021
Fiscal Year Ended March 31, 2020

Net Sales
Millions of Yen %16,42923.1
13,346(15.1)

Fiscal Year Ended March 31, 2021
Fiscal Year Ended March 31, 2020

Net Income
Per ShareYen
184.98136.93Operating Income
Millions of Yen %12,74936.0
9,371(20.5)(% indicates changes from previous fiscal year)
Ordinary Income
Net Income
Millions of Yen %Millions of Yen %12,04832.2
11,54431.7
9,111(19.0)
8,762
46.8

Diluted Net Income
Per ShareYen
184.16136.39(2) Non-consolidated Financial Condition(% indicates changes from previous fiscal year)
Total Assets
Net Assets
Capital-to-asset Ratio
Net Asset per Share
Millions of Yen
Millions of Yen%
Yen
Fiscal Year Ended March 31, 2021
191,737
140,10672.8
2,235.07
Fiscal Year Ended March 31, 2020
156,000
130,996
83.6
2,090.11(Reference) Equity Capital: As of the end of the fiscal year ended March 31, 2021: 139,514 million yen
As of the end of the fiscal year ended March 31, 2020: 130,428 million yen*These financial statements are not subject to audit procedures by the certified public accountants or the independent auditor.
* 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 details,
please see “1. Business Results - (1) Business Results for Fiscal Year 2021 - (ii) Business Forecast for Next Fiscal Year” on page 11.

-3-

Table of Contents for Attached Materials
1.

Business Results -------------------------------------------------------------------------------------------------------------------------------------- 5(1)

Business Results for Fiscal Year 2021 ------------------------------------------------------------------------------------------------------------ 5(2)

Financial Condition as of Fiscal Year 2021 ------------------------------------------------------------------------------------------------------ 12(3)

Basic Policy Regarding Distribution of Profits and Dividends for Fiscal Year 2021 and Fiscal Year 2022 ----------------------------- 13

2.

Basic Policies regarding Selection of Accounting Standards----------------------------------------------------------------------------------- 13

3.

Consolidated Financial Statements and Accompanying Notes-------------------------------------------------------------------------------- 14(1)

Consolidated Balance Sheets ---------------------------------------------------------------------------------------------------------------------- 14(2)

Consolidated Statements of Income--------------------------------------------------------------------------------------------------------------- 16(3)

Consolidated Statements of Comprehensive Income ------------------------------------------------------------------------------------------- 17(4)

Consolidated Statements of Equity ---------------------------------------------------------------------------------------------------------------- 18(5)

Consolidated Statements of Cash Flows ---------------------------------------------------------------------------------------------------------- 19(6)

Notes on Going Concern --------------------------------------------------------------------------------------------------------------------------- 20(7)

Basic Significant Matters in Preparation of Consolidated Financial Statements ------------------------------------------------------------ 20(8)

Notes to the Consolidated Financial Statements ------------------------------------------------------------------------------------------------ 21-4-

Qualitative Information and Financial Statements
1.

Business Results(1) Business Results for Fiscal Year 2021
(i) Results for the Fiscal Year Ended March 31, 2021

Net sales
Cost of sales
Sales profit
Selling, general and administrative expenses
Impairment charges on goodwill and other intangible
assets (A)Operating (loss) income
Other income
Valuation gain (loss) on marketable securities andinvestments – net (B)Income before income taxes and equity in net incomeof affiliated companies
Net income attributable to Wacoal Holdings Corp.

Previous Fiscal Year(ended March 2020)
Amount186,760
84,959101,801
94,696473

Reference figure (i): Operating income not taking into
account A
Reference figure (ii): Income before income taxes andequity in net income of affiliated companies not taking
into account A and B

Current Fiscal Year(ended March 2021)
Amount152,204
67,79884,406
82,836
2,685(Millions of Yen)
Increased/(Decreased) fromprevious fiscal year
Amount%(34,556)(18.5)(17,161)(20.2)(17,395)(17.1)(11,860)(12.5)+2,212+467.7

6,632
1,487(3,760)(1,115)
1,517
10,390(7,747)+30+14,150

+2.0
-

4,359

10,792+6,433+147.6

3,472

7,025

+3,553+102.3

7,105

1,570

(5,535)(77.9)

8,592

3,087

(5,505)(64.1)The business environment surrounding our group during the current fiscal year (from April 1, 2020 to March 31, 2021) has continued toremain difficult due to stagnation of economic activities resulting from the global coronavirus pandemic (the “pandemic”). While vaccination
has started in many countries and regions and we see progress toward the end of the pandemic, we must remain vigilant of the impact of thepandemic spreading further especially in Japan, and the future remains uncertain.
Under such circumstances, we have moved forward with our initiatives to create a management structure that leads to high profitability
based on the following policies for regrowth, while conducting business activities by prioritizing the safety and well-being of our customers,
employees and partner companies.
Basic Policies:

To prioritize the health and well-being of our customers, employees and partner companies

Short-Term Policies:

To implement cost reduction in response to deterioration in business conditions and to secure a stablefinancial foundation・ to reassess our current initiatives and spending plans in all business・ to strengthen liquidity on hand in preparation for the prolonged impact of the pandemic
・ 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 and to strengthen ourcapability to address new customer service and sale styles

Consolidated sales for the current fiscal year were 152.20 billion yen, a decrease of 18.5% from such sales for the previous fiscal year.
Revenue significantly decreased due to the impact of temporary closings or shortened business hours of retail stores due to stay home measures,
as well as a decrease in the number of customers visiting stores in the metropolitan areas, despite growth in e-commerce sales in various
countries in response to higher demand from consumers staying home.

-5-Our efforts to reduce costs at our operating companies, as well as our use of an employment adjustment subsidy and other government
assistance in various countries were not enough to offset the impairment charges recorded on goodwill related to Wacoal Europe Ltd. (“Wacoal
Europe”) and fixed assets at other group companies due to the impact of the pandemic, and as a result, we recorded a consolidated operating
loss of 1.12 billion yen (consolidated operating income of 6.63 billion yen for the previous fiscal year).
Wacoal Europe has continued to show stable growth since our acquisition in 2012 by developing high value-added products andimplementing marketing activities that are tailored to the characteristics of each country where we do business or operate distribution channels.
However, in light of the impact of the pandemic in the United Kingdom and Europe, we reassessed the fair value of goodwill based on ouroutlook of our business, and recorded the impairment charges of 2.67 billion yen. As a result, the residual value of goodwill with respect toWacoal Europe was 9.40 billion yen (61.7 million pound) based on the exchange rate as of the end of current fiscal year.
Consolidated income before income taxes and equity in net income was 10.79 billion yen (an increase of 147.6% from such consolidated
income for the previous fiscal year). This significant increase was due to the recognition of a valuation gain on marketable securities andinvestments (net) of 10.39 billion yen.
As a result of the above, net income attributable to Wacoal Holdings Corp. and the ratio of net income attributable to Wacoal Holdings
Corp. to shareholders’ equity for the current fiscal year were 7.03 billion yen (an increase of 102.3% from such net income for the previous
fiscal year) and 3.3%, respectively. The exchange rates used for the current fiscal year (previous fiscal year) were: 106.06 yen (108.74 yen) to
the U.S. dollar; 138.68 yen (138.24 yen) to the Sterling pound; and 15.48 yen (15.78 yen) to the Chinese yuan.
(Under the U.S. accounting standards that we use, an employment adjustment subsidy is deducted from cost of sales and selling, general andadministrative expenses. Equity securities held by the Wacoal Holdings Corp. and consolidated subsidiaries are measured at fair value, and anychange from the beginning of the period are recognized as valuation loss/gain on marketable securities and investments – net under otherincome/expenses.)-6-

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, wehave changed our “Peach John Business” to be presented as a separate reporting segment, which had been included in our “Other” segment,
because it satisfied the relevant quantitative criteria. The segment information for the previous fiscal year has been prepared based on thesegments reported for the current fiscal year.
(Millions of Yen)
Previous Fiscal Year(ended March 31, 2020)
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

186,760
106,11249,808
11,224
19,616

Current Fiscal Year(ended March 31, 2021)

Distribution
Ratio (%)
100.0
56.8
26.7
6.0
10.5

Amount152,204
86,13341,355
12,20012,516

Distribution
Ratio (%)
100.0
56.6
27.2
8.0
8.2

Increased/(Decreased)from previous year
Amount%(34,556)(19,979)(8,453)+976(7,100)(18.5)(18.8)(17.0)+8.7(36.2)(Millions of Yen)

Previous Fiscal Year(ended March 31, 2020)

Current Fiscal Year(ended March 31, 2021)

Increased/(Decreased)from previous fiscal year

Amount% to Sales

Amount% to Sales

Amount

%

3.6
5.7
3.0
-

(1,115)627(2,603)
1,591
(730)

0.7
13.0
-

(7,747)(5,456)(4,096)+1,942(137)(89.7)
-

6,632
6,083
1,493
(351)
(593)

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

Net Sales

Previous Fiscal Year(ended March 31, 2020)

99,22419,194

Distribution
Ratio (%)
53.1
10.3

12,988
10,337
11,224
5,760
8,717

7.0
5.5
6.0
3.1
4.7

AmountWacoal Corp.
Wacoal International Corp.
(U.S)
Wacoal Europe Ltd.
Wacoal China Co., Ltd.
Peach John Co., Ltd.
Lecien Corporation
Nanasai Co., Ltd.
*Sales to external customers only

Current Fiscal Year(ended March 31, 2021)-7-

Increased/(Decreased)from previous fiscal year
Amount

%79,877
17,649Distribution
Ratio (%)
52.5
11.6

(19,347)(1,545)(19.5)
(8.0)

9,896
8,755
12,200
4,614
5,312

6.5
5.8
8.0
3.0
3.5

(3,092)(1,582)+976(1,146)(3,405)(23.8)(15.3)+8.7(19.9)(39.1)

Amount(Millions of Yen)

Operating Income/(Loss)

Previous Fiscal Year(ended March 31, 2020)

Current Fiscal Year(ended March 31, 2021)

Increased/(Decreased)from previous fiscal year

AmountAmountAmount% to Sales% to Sales%

Wacoal Corp.
3,140
3.2
(2,022)(5,162)
Wacoal International Corp.
401
2.1
(914)
(1,315)(U.S.)
Wacoal Europe Ltd.
1,007
7.8
666
6.7
(341)
(33.9)
Wacoal China Co., Ltd.
923
8.9
625
7.1
(298)
(32.3)
Peach John Co., Ltd.
(351)
1,591
13.0
+1,942
Lecien Corporation
(478)
221
4.8
+699
Nanasai Co., Ltd.
218
2.5
(358)
(576)
*Net sales and operating income/(loss) for the major subsidiaries above are based on the accounting standards of the respective countries.
a.

Wacoal Business (Domestic)

Sales attributable to our “Wacoal Business (Domestic)” segment were 86.13 billion yen (a decrease of 18.8% from such sales for theprevious fiscal year) and operating income was 0.63 billion yen (a decrease of 89.7% from such operating income for the previous fiscal year).
Despite a significant decrease in profit due to the impact of decreased revenue, we recorded an operating income as a result of our efforts to
reduce costs and our use of an employment adjustment subsidy and other government assistance.
Wacoal Corp.:
Sales from Wacoal Corp. decreased by 19.5% as compared to such sales for the previous fiscal year as a result of weak sales from physicalstores over the year due to the impact of the pandemic, while our e-commerce website maintained high growth. Sales for the first half of thecurrent fiscal year (from April to September) decreased by 30.6% as compared to such sales for the corresponding period of the previous fiscal
year due to the absence of increased demand before the consumption tax increase during the previous fiscal year, in addition to the impact of
temporary closings of physical stores and stay-at-home measures implemented during a state of emergency. Although sales recovered during
the current consolidated third quarter, sales for the second half of the current fiscal year (from October to March) also decreased by 5.5% ascompared to the corresponding period of the previous fiscal year due to consumers staying home during another state of emergency declared in
the current consolidated fourth quarter.
While sales from general merchandise stores in the suburbs were strong, sales from physical stores located in the center of themetropolitan areas including outlet malls or other large-scale commercial facilities were stagnant due to a decrease in the number of customers
visiting our retail stores in efforts to promote remote work, as well as changes in consumer attitudes and behavior that led to less travel andfewer crowds.
Sales from our strategically strengthened e-commerce website significantly increased since the previous fiscal year (an increase of 55.2%
as compared to such sales for the previous fiscal year) as a result of additional acquisition of new customers making purchases from home,
online-to-offline marketing initiatives such as redirecting our retail store-registered members to our e-commerce website, as well as the positive
impact of expanded sales from existing customers whose purchase rate increased due to our marketing utilizing automation involving
distribution of content tailored to each customers. Our virtual one-on-one consultation by our store personnel also significantly contributed tothe acquisition of new customers in a new life style.
In efforts to improving CX (customer experience), we promoted the installation of our 3D body scanning and AI (artificial
intelligence)-based customer service system and are providing such service at sixteen shops as of March 31, 2021 (addition of ten shops since
the end of the previous fiscal year). We are piloting an avatar counseling system, which we are developing to introduce an online customer
service by our store personnel during the current fiscal year, and are addressing issues toward commercialization.
Our efforts to reduce costs were not enough to offset the impact of the decreased revenue and as a result, we recorded an operating loss of
2.02 billion yen (operating income of 3.14 billion yen for the previous fiscal year). An employment adjustment subsidy of 2.00 billion yen is
not included and reflected in such operating loss, because it is recognized as non-operating income (which has been reclassified as operating
loss under the consolidated business results and segment information of Wacoal Business (Domestic) 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 41.36 billion yen (a decrease of 17.0% fromsuch sales for the previous fiscal year) due to temporary closing of physical stores and stay-at-home efforts resulting from the spread of thepandemic, as well as the impact of the appreciation of the Japanese yen (0.72 billion yen). Sales of our Peach John brand products sold in China,
which were previously recorded under this “Wacoal Business (Overseas)” segment, are now recorded under our “Peach John Business”
segment starting with the current fiscal year, and the business result for the previous fiscal year has been revised retroactively (the effect-8-

following such change (and one of the factors decreasing sales) is approximately 0.51 billion yen for the current fiscal year (approximately 0.74
billion yen for the previous fiscal year)).
We recorded an operating loss of 2.60 billion yen (operating income of 1.49 billion yen for the previous fiscal year). This operating loss
was due to our continued strategic marketing investments to achieve rapid growth of Intimates Online Inc. (“Intimates Online”), which we
acquired during the previous fiscal year, as well as the recognition of impairment charges on goodwill with respect to Wacoal Europe, in
addition to the impact of decreased revenue, despite our efforts to reduce costs and by using government assistance provided by governments
across the world.
Wacoal International Corp. (U.S.):
Sales from Wacoal International Corp. (U.S.) on a local currency basis decreased by 5.7% (a decrease of 8.0% on a Japanese yen basis) as
compared to such sales for the previous fiscal year. Although there was a positive impact of the inclusion of sales from Intimates Online on oursales for the first half of the current fiscal year, revenue decreased by 15.4% as compared to such revenue for the corresponding period of theprevious fiscal year due to the weak sales from Wacoal America Inc., which distributes “Wacoal” and “b.tempt’d” brand products at physicalstores (department stores), resulting from the impact of the pandemic. On the other hand, revenue for the second half of the current fiscal year
increased by 5.4% as compared to such revenue for the corresponding period of the previous fiscal year as a result of strong sales from
Intimates Online, which maintained a high purchase rate and average spending per customer, as well as high growth in sales achieved from our
e-commerce website and third-party e-commerce websites, which offset declines in sales from physical stores. During the current consolidated
fourth quarter, Intimates Online commenced transactions with Target Corporation, a major retailer in the United States, and is distributing
LIVELY brand products through e-commerce channels and physical stores.
We recorded an operating loss of 8.6 million dollars on a local currency basis (0.91 billion yen on a Japanese yen basis) (operating incomeof 3.7 million dollars (0.40 billion yen on a Japanese yen basis) for the previous fiscal year) due to our continued strategic growth investments
in our LIVELY brand distributed by Intimates Online, as well as the impact of the decreased revenue, despite our efforts to reduce costs and useof government assistance.
Wacoal Europe Ltd.:Sales from Wacoal Europe on a local currency basis decreased by 24.0% (a decrease of 23.8% on a Japanese yen basis) as compared tosuch sales for the previous fiscal year. Sales for the first half of the current fiscal year decreased by 33.6% as compared to such sales for thecorresponding period of the previous fiscal year due to the significant impact of the lockdown measures implemented in the United Kingdom
and major countries in Europe. While signs of recovery were visible during the Christmas sale season, sales for the second half of the current
fiscal year decreased by 12.6% as compared to such sales for the corresponding period of the previous fiscal year due to additional lockdown
measures implemented during the current consolidated fourth quarter, which impacted our business operations. Sales from our e-commercebusiness, which we launched in the previous fiscal year, exceeded our plan, and now accounts for 5.4% of sales from Wacoal Europe for thecurrent fiscal year.
Although operating income on a local currency basis significantly decreased by 34.2% (a decrease of 33.9% 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 (excluding the impairment charges of
2.67 billion yen on goodwill with respect to Wacoal Europe).
Wacoal China Co., Ltd.:Sales from Wacoal China Co., Ltd. on a local currency basis decreased by 13.7% (a decrease of 15.3% on a Japanese yen basis) as
compared to such sales for the previous fiscal year.
Sales for the first half of the current fiscal year (from January to June) decreased by 25.8% as compared to such sales for the corresponding
period of the previous fiscal year due to temporary closings of physical stores following the impact of the pandemic, despite strong sales fromthird-party e-commerce websites from aggressive distribution of our AMPHI brand products. For the second half of the current fiscal year
(from July to December), while we struggled to attract orders through a large-scale promotion campaign conducted by e-commerce vendors inNovember, sales from physical stores (department stores) recovered due to strong sales from our “WACOAL” and “Salute” brand products,
and as a result, sales increased by 2.6%.
Although operating income on a local currency basis significantly decreased by 31.2% (a decrease of 32.3% on a Japanese yen basis) due
to the impact of decreased revenue, we recorded profit as a result of our efforts to reduce costs.
c.

Peach John Business

Sales attributable to our “Peach John Business” segment were 12.20 billion yen (an increase of 8.7% as compared to such sales for theprevious fiscal year) as a result of our new product planning that met our consumer needs and development of trending content, as well as our
successful marketing activities that were efficient in increasing the number of new customers and annual purchase frequency. Sales of ourPeach John brand products sold in China, which were previously recorded under the “Wacoal Business (Overseas)” segment, are now recorded
under this “Peach John Business” segment starting with the current fiscal year, and the business result for the previous fiscal year has been-9-

revised retroactively (the effect following such change (and one of the factors increasing sales) is approximately 0.51 billion yen for the current
fiscal year (approximately 0.74 billion yen for the previous fiscal year)).
E-commerce sales through our website in Japan increased by 43.5% from such sales for the corresponding period of the previous fiscal
year as a result of an increase in the number of new customers over the year, as well as the steady sales of our regular products. Sales from ourretail stores, however, decreased by 11.9% due to the impact of the temporary closings of physical stores during the current consolidated firstquarter, although the reduction of cost and improvement in the purchase rate of customers visiting our retail stores contributed to the strong
sales after the current consolidated second quarter.
We recorded an operating income of 1.59 billion yen (operating loss of 0.35 billion yen for the previous fiscal year), a significant increase
from the previous fiscal year. This profit was attributable to the positive impact of the increased revenue, the impact 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.
d.

Other

Overall sales attributable to our “Other” business segment were 12.52 billion yen (a decrease of 36.2% as compared to such sales for theprevious fiscal year), while we recorded an operating loss of 0.73 billion yen (operating loss of 0.59 billion yen for the previous fiscal year).
Lecien Corporation:
Sales from Lecien Corporation decreased by 19.9% as compared to such sales for the previous fiscal year due to the weak sales of ourprivate products sold by general merchandise stores, which were impacted by our clients’ expense control efforts over purchases. We recorded
an operating income of 0.22 billion yen (operating loss of 0.48 billion yen for the previous fiscal year) due to our efforts to withdraw fromunderperforming businesses in the consolidated 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 previous fiscal year due to our construction businessweakened by the cancellation and postponement of new shop openings and various events following the spread of the pandemic. We recorded
an operating loss of 0.36 billion yen (operating income of 0.22 billion yen for the previous fiscal year) due to a significant impact of decreased
revenue, despite our efforts to reduce costs.

- 10 -

(ii) Business Forecast for Next Fiscal Year
(Millions of Yen)
Consolidated Net Sales
and Income

Net Sales
Operating Income/(Loss)
Income Before Income Taxes
and Equity in Net Income of
Affiliated Companies
Net Income Attributable to
Wacoal Holdings Corp.
Net Income Attributable to
Wacoal Holdings Corp. per
Share

Current Fiscal Year(ended March 31, 2021)

Next Fiscal Year(ending March 31, 2022)

Amount% to Sales

Amount152,204(1,115)
10,792

7.1

7,025
Yen
112.57

Increased/(Decreased)from previous year
Amount%184,000
6,000
7,900

Distribution
Ratio (%)
3.3
4.3

+31,796+7,115(2,892)+20.9(26.8)

4.6

5,500

3.0

(1,525)(21.7)

-

Yen
88.11

-

-

-

(Millions of Yen)
Sales by Segment

Current Fiscal Year(ended March 31, 2021)
AmountTotal Net Sales
Wacoal Business (Domestic)
Wacoal Business (Overseas)
Peach John Business
Other

152,204
86,13341,355
12,20012,516

Next Fiscal Year(ending March 31, 2022)

Distribution
Ratio (%)
100.0
56.6
27.2
8.0
8.2

Amount184,000
99,30057,25012,50014,950Distribution
Ratio (%)
100.0
54.0
31.1
6.8
8.1

Increased/(Decreased)from previous year
Amount%+31,796+13,167+15,895+300+2,434

+20.9
+15.3
+38.4
+2.5
+19.4
(Millions of Yen)

Operating Income/(Loss)by Segment

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

Current Fiscal Year(ended March 31, 2021)

Next Fiscal Year(ending March 31, 2022)

Increased/(Decreased)from previous fiscal year

Amount% to Sales

Amount% to Sales

Amount

%

0.7
13.0
-

6,000
4,000
1,140
1,100
(240)

3.3
4.0
2.0
8.8
-

+7,115+ 3,373+3,743(491)+490+538.0(30.9)-(1,115)627(2,603)
1,591
(730)

Our forecast for the fiscal year ending March 31, 2022 is presented in the above table. The impact of the change in the valuation loss orgain on marketable securities and investments to our business results is not reflected in the forecast above. The exchange rate used for the U.S.
dollar is 108.0 yen to the dollar; the exchange rate used for the Sterling pound is 150.0 yen to the pound; and the exchange rate used for the
Chinese yuan is 16.5 yen to the yuan.
We continue to move forward with efforts to become “Wacoal of the World as a Group”, that is, to continue to offer pioneering products
to the global markets by taking full advantage of our management resources and our group’s network, and to gain reputation for our reliability
from stakeholders around the world with our group’s products and services as well as our commitments to social issues by cultivating newmarket opportunities for the undergarment industry.
The pandemic, however, continues to be a threat. While vaccination has started in certain countries and regions, we believe that full-scale
recovery will take a long time as economic activities may continue to be restricted by infection prevention measures, in certain aspects,
including on social outings.
Under such circumstances, we will move forward with our initiatives to create a management structure that leads to high profitability,
while conducting business activities that prioritize the safety and well-being of our customers, employees and partner companies. We will aim
to build a deeper, broader and longer relationship with each customer by continuing to develop and provide products and services that
consumers expect in their new lifestyles, which have significantly changed as a result of the pandemic, and by promoting our unique CX
strategies, including on the merger between online and offline activities and utilization of a customer database, in efforts to improve customer
experience.
In addition, as environmental problems continue to worsen, consumers’ awareness of sustainability is evolving. We plan to move forwardwith our ESG (Environmental, Social and Governance) management, which aims to grow by enhancing social and economic values, and to- 11 -

further address important issues such as governance, human rights and environmental issue. At the same time, we will promote establishmentof an operating base that achieves sustainable growth through work-style reform (including teleworking), cultivation of human resources
supporting business growth and creation of a corporate culture that offers job satisfaction.
Information on Risk related to Coronavirus Infection:
It is currently difficult to forecast the end of the pandemic given that the pandemic is spreading further in Japan. Our forecast for the businessresults for the fiscal year ending March 31, 2022 is based on our assumption that the impact on our business results that we have identified up
to date will continue for the first half of the fiscal year ending March 31, 2022 and is subject to change depending on how the pandemic
develops. We will disclose our revised forecast promptly if we determine that the current forecast needs to be revised.
In addition, with regard to the declaration of a state of emergency in Japan issued on April 23, based on the information currently available,
including government announcements, it is assumed that the state of emergency will continue until the end of May, and its impact has beenfactored into the forecast.
(2) Financial Condition as of Fiscal Year 2021
Status of Assets, Liabilities and Shareholders’ Equity
Our total assets as of March 31, 2021 were 322,761 million yen, an increase of 45,073 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 current liabilities were 104,145 million yen, an increase of 35,905 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.
Shareholders’ equity was 215,612 million yen, an increase of 10,241 million yen from the end of the previous fiscal year, due torecognition of net income and changes in pension liability adjustments.
As a result of the above, our total shareholders’ equity ratio as of March 31, 2021 was 66.8%, a decrease of 7.2% from the end of theprevious fiscal year.
Cash Flows Status
Cash flow provided by operating activities:
Cash flow provided by operating activities was 4,260 million yen, a decrease of 9,065 million yen as compared to the previous fiscal
year, after adjustments for changes in assets and liabilities to our net income of 6,804 million yen plus adjustments for depreciation expenses
and deferred taxes.
Cash flow used in investing activities:
Cash flow used in investing activities was 2,562 million yen, as compared to cash flow provided by investing activities in the amountof 2,569 million yen for the previous fiscal year, due to payments made to acquire tangible and intangible assets.
Cash flow provided by financing activities:
Cash flow provided by financing activities was 33,605 million yen, as compared to cash flow used in financing activities in theamount of 17,471 million yen for the previous fiscal year, due to procurements of short-term loan and long-term debt, despite cash dividend
payments, payments to acquire interests in subsidiaries from noncontrolling interests and contingent consideration payment.
As a result, the balance of cash and cash equivalents at the end of fiscal year 2021, calculated by adding the exchange difference on
cash and cash equivalents to the above total, was 63,557 million yen, an increase of 35,652 million yen as compared to the end of the previous
fiscal year.

- 12 -

Trends in certain cash-flow indicators

Shareholders’ equity ratio (%)
Shareholders’ equity ratio basedon market value (%)
Debt redemption years (years)
Interest coverage ratio (times)

Fiscal Year
Ended
March 31, 2019

Fiscal Year
Ended
March 31, 2020

Fiscal Year
Ended
March 31, 2021

76.8

74.0

66.8

63.7

52.7

47.5

0.6

0.3

9.9

1,238.2

666.3

59.2

Shareholders’ equity ratio = shareholders’ equity/total assets
Shareholders’ equity ratio based on the market value = aggregate market value of shareholders’ equity/total assets
Debt redemption years = interest-bearing debt/cash flow provided by operating activities
Interest coverage ratio = cash flow provided by operating activities/interest payment
Interest payment = “cash paid for interest” as described in the additional cash flow information following the consolidated statementsof cash flows(3) Basic Policy Regarding Distribution of Profits and Dividends for Fiscal Year 2021 and Fiscal Year 2022
Our basic policy on profit distributions to shareholders is to make stable distributions based on consideration of our consolidated
performance, while seeking to increase our enterprise value through active investments aimed at higher profitability and to increase net income
per share.
With respect to retained earnings, we will actively invest in expanding our customer bases for our domestic business and our overseas
businesses, with the aim of improving our corporate value. We also plan to use our retained earnings for strategic investments for maintaining
competitiveness and reinforcing growth. With these efforts, we seek to benefit our shareholders by improving future profitability.
Based on the above, we are scheduled to distribute 20.00 yen as a year-end dividend for the current fiscal year, the estimated dividend asannounced during the latest quarter, and the annual cash dividend per share will be 40.00 yen, including the interim dividend per share of 20.00
yen.
For the next fiscal year ending March 31, 2022, we plan to declare, based on the above policy and business forecast, an annual cash
dividend per share of 50.00 yen, the total of an interim dividend per share of 20.00 yen and a year-end dividend per share of 30.00 yen, an
increase of 10.00 yen from the annual cash dividend per share for the current fiscal year.
2.

Basic Policies regarding Selection of Accounting Standards

Our group has been preparing our consolidated financial statements based on the accounting standards established prior to the introductionof the accounting standards for consolidated financial statements in Japan, and for this reason, we have been using the accounting standards
generally accepted in the United States.
Our group is making efforts to prepare internal manuals and guidelines in anticipation of International Financial Reporting Standards
adoption in the future.

- 13 -

3.

Consolidated Financial Statements and Accompanying Notes(1) Consolidated Balance Sheets

Accounts

As of March 31, 2020

As of March 31, 2021

(Assets)

Millions of Yen

Millions of Yen

AmountIncreased/(Decreased)
Millions of Yen

27,90563,55735,652Time deposits

797

1,443

646

Marketable securities

656

253

(403)

Notes and accounts receivable

20,062

17,571(2,491)

Allowance for doubtful receivables
Inventories(489)
43,427(346)
43,250143(177)

I. Current assets
Cash and cash equivalents

Return assets

868

600

(268)

4,964

7,794

2,830

98,190134,12235,932

Land

21,46020,569(891)

Buildings and building improvements

74,03972,978(1,061)

Machinery and equipment

18,782

19,356574

Construction in progress

1,090

1,264

174

115,371

114,167(1,204)(63,288)(64,409)(1,121)

52,08349,758(2,325)

Operating leases right-of-use assets

13,54012,729(811)

Investments in affiliated companies

21,595

21,207(388)

Investments

43,90451,603

7,699

Goodwill

22,371

21,169(1,202)Other intangible assets

14,547

15,220673

Prepaid pension expense

4,974

9,533

4,559

Deferred income taxes

1,118

1,649

531

Other

5,366

5,771

405

127,415

138,881

11,466277,688322,761

45,073

Other current assets
Total current assets
II. Property, Plant and Equipment

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

Total other assets
Total Assets- 14 -

Accounts

As of March 31, 2020

As of March 31, 2021

(Liabilities)

Millions of Yen

Millions of Yen

AmountIncreased/(Decreased)
Millions of Yen

I. Current Liabilities
Short-term bank loans

3,364

40,67237,308Trade notes payable

1,112

712

(400)

Trade accounts payable

9,588

8,734

(854)

Other payables

7,107

6,610

(497)

17,807

16,056(1,751)

Accrued payroll and bonuses

6,734

6,822

88

Income taxes payable

4,878

1,025

(3,853)

Refund liabilities

2,645

2,266

(379)

Short-term operating lease liabilities

4,600

4,411

(189)

Current portion of long-term debt

50

35

(15)

4,029

4,784

755

44,10776,071

31,964

Notes and accounts payable

Other current liabilities
Total current liabilities
II. Long-term liabilities
Long-term debt
Liabilities for termination and retirement
benefit
Deferred income taxes

35

1,498

1,463

2,069

1,942

(127)

7,911

12,292

4,381

Long-term operating lease liabilities

9,101

8,520

(581)

Contingent consideration (long-term)

2,786

1,639

(1,147)

Other long-term liabilities

2,231

2,183

(48)

Total long-term liabilities

24,13328,074

3,941

Total liabilities

68,240104,145

35,905

I. Common stock

13,26013,260-

II. Additional paid-in capital

29,83629,120(716)

III. Retained earnings
IV. Accumulated other comprehensive income(loss)
Foreign currency translation adjustments

185,233

181,346(3,887)(1,033)

1,770

2,803

Pension liability adjustments(4,594)(1,008)

3,586

V. Treasury stock, at cost
Total Wacoal Holdings Corp.
shareholders’ equity
VI. Noncontrolling interests
Total equity(17,331)(8,876)

8,455

205,371

215,612

10,241

4,077
209,448

3,004
218,616(1,073)
9,168

277,688322,761

45,073(Equity)

Total liabilities and equity- 15 -

(2) Consolidated Statements of Income(% indicates percentage of net sales)
Accounts

I.

Fiscal Year Ended
March 31, 2020

Fiscal Year Ended
March 31, 2021

Millions of Yen%

Millions of Yen

186,760

100.0

Cost of sales
Selling, general and administrative
expenses
Impairment charges on goodwill andother intangible assets

84,959Total operating costs and expenses

Net Sales

AmountIncreased/(Decreased)%

Millions of Yen

152,204

100.0(34,556)

45.5

67,79844.5(17,161)

94,696

50.7

82,836

54.4(11,860)

473

0.2

2,685

1.8

2,212

180,128

96.4

153,319100.7(26,809)

6,632

3.6

(1,115)(0.7)(7,747)

II. Operating costs and expenses

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

177

61

(116)

Interest expense

(19)

(78)

(59)

Dividend income
Valuation gain (loss) on marketablesecurities and investments – net
Other – net

1,506

1,126

(380)

(3,760)

10,39014,150Total other income (expenses)(2,273)(1.3)

11,907

7.8

14,1804,359

2.3

10,792

7.1

6,433

7,126

3.8

1,803

1.2

(5,323)

Deferred(5,673)

(3.1)

2,278

1.5

7,951

Total income taxes

1,453

0.7

4,081

2.7

2,628

2,906

1.6

6,711

4.4

3,805

62

0.0

93

0.1

31

2,968

1.6

6,804

4.5

3,836

504

0.3

221

0.1

(283)

3,472

1.9

7,025

4.6

3,553

Income before income taxes and equity in
net income of affiliated companies
Income taxes
Current

Income before equity in net income ofaffiliated companies
Equity in net income of affiliatedcompanies
Net income
Net loss attributable to non-controllinginterests
Net income attributable to Wacoal
Holdings Corp.

(177)

408

- 16 -

585

(3) Consolidated Statements of Comprehensive Income

Accounts

Fiscal Year Ended
March 31, 2020

Fiscal Year Ended
March 31, 2021

AmountIncreased/(Decreased)

Millions of Yen

Millions of Yen

Millions of Yen

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

2,968

6,804

3,836

(2,532)

2,648

5,180

Pension liability adjustments

1,085

3,591

2,506

Total of other comprehensive income (loss)(1,447)

6,239

7,686

Comprehensive income
Comprehensive loss attributable tononcontrolling interests
Comprehensive income attributable to Wacoal
Holdings Corp.

1,521

13,043

11,522

452

371

(81)

1,973

13,414

11,441- 17 -

(4) Consolidated Statements of Equity
Fiscal Year Ended March 31, 2020
EquityShares of
Outstanding Common
Item

Common

Stock

Stock
Thousandshares

As of March 31, 2019
Cumulative effects ofadoption of
ASU2018-11
Cash dividends paid to
Wacoal Holdings Corp.
shareholders
Cash dividends paid tononcontrolling interests
Repurchase of treasury
stock
Cancellation of treasury
stock
Other
Net income
Other comprehensive
income (loss)
As of March 31, 2020

65,178Additional
Paid-in
CapitalRetained

Accumulated othercomprehensive

Earnings

incomeTreasury
stock

Total
Shareholders’EquityInterests

Total Equity

Millionsof YenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillionsof Yen13,26029,807

193,139(4,128)(15,584)

216,494

4,650

221,144

(515)

(515)

(515)

(4,907)(4,907)(4,907)(2,798)(5,935)23

62,403

Noncontrolling

13,260

29

(21)
3,472

29,836

185,233(1,499)(5,627)

(237)

(237)

(7,745)
5,935(7,745)
-

63

71
3,472

116
(504)

187
2,968

(1,499)205,37152
4,077(1,447)
209,448(17,331)(7,745)-

Fiscal Year Ended March 31, 2021
EquityShares of
Outstanding Common
Item

Common

Stock

Stock
Thousandshares

As of March 31, 2020
Cash dividends paid to
Wacoal Holdings Corp.
shareholders
Cash dividends paid tononcontrolling interests
Repurchase of treasury
stock
Cancellation of treasury
stock
Equity transactions with
noncontrolling interests
Other
Net income
Other comprehensive
income (loss)
As of March 31, 2021

62,403

Additional
Paid-in
CapitalRetained

Accumulated other

Earnings

comprehensive
incomeTreasury
stock

Total
Shareholders’EquityInterests

Total Equity

Millionsof YenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillions ofYenMillionsof Yen13,26029,836

185,233(5,627)(17,331)205,371

4,077

209,448(2,496)(2,496)
-

(0)

(1)
8,404

(8,404)(740)
1862,421

Noncontrolling24

13,26029,120(12)
7,025

181,346- 18 -

52

6,389
762

(8,876)(2,496)
(81)

(1)
-

(81)
(1)
-

(740)

(621)

(1,361)

64
7,025

(221)

64
6,804

6,389
215,612

(150)
3,004

6,239
218,616(5)Consolidated Statements of Cash Flows

Accounts

I. Operating activities
1. Net income
2. Adjustments to reconcile net income to net cash provided
by operating activities(1) Depreciation and amortization(2) Provision for doubtful receivables(3) Deferred income taxes(4) (Gain) loss on sales or disposal of property, plant and equipment – net(5) Impairment charges on property, plant and equipment(6) Impairment charges on goodwill and other intangible
assets(7) Valuation (gain) loss on marketable securities and investments –net(8) Equity in net loss of affiliated companies,
less dividends received(9) Changes in assets and liabilities
Decrease in notes and receivable
Decrease (increase) in inventories
Decrease in return assets
Increase in other current assets
Decrease in notes and accounts payable
Decrease in refund liabilities
Increase in liabilities for termination and retirement
benefits(Decrease) increase in other liabilities(10) 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 sale and redemption of equity securities
Payments to acquire equity securities
Proceeds from redemption of debt securities
Proceeds from sale of property, plant and equipment
Capital expenditures
Payments to acquire intangible assets
Payments for loans
Acquisition of a subsidiary (net of cash acquired)
Other
Net cash (used in) provided by 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. Repayment of short-term loan (over 3 months)
4. Procurement of long-term debt
5. Repayment of long-term debt
6. Repurchase of treasury stock
7. Dividends paid on common stock
8. Dividends paid to noncontrolling interests
9. Proceeds from stock issuance to noncontrolling interests
10. Payments to acquire interests in subsidiaries fromnoncontrolling interests
11. 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 year
VII. Cash and cash equivalents, end of year

Fiscal Year Ended
March 31, 2020

Fiscal Year Ended
March 31, 2021

AmountIncreased/(Decreased)

Millions of Yen

Millions of Yen

Millions of Yen

2,968

6,804

3,836

6,029
299
(5,673)
103
769

6,128
(199)
2,278
(365)
1,136

99
(498)
7,951
(468)
367

473

2,685

2,212

3,760

(10,390)(14,150)

480

469

(11)

4,685
(1,350)
312
(29)
(373)
(837)

2,767
972
268
(2,632)
(859)
(379)

(1,918)2,322(44)(2,603)
(486)
458

776
665
268
13,325226(4,485)
(164)
4,260

(550)
(5,150)(432)(9,065)

(438)
3,576
15,252
(339)
544
104
(3,442)(3,539)(9,181)
32
2,569

(941)
291
2,340
(7)
742
889
(2,764)(2,840)(315)
43(2,562)(503)(3,285)(12,912)
332
198
785
678
699
(315)
9,181
11
(5,131)(4,645)(53)(7,745)(4,907)(237)
116

17,20820,424
(424)
1,447
(50)
(1)
(2,496)(81)-

21,853
20,424
(424)
1,447
3
7,744
2,411
156
(116)

(17,471)(1,361)(1,061)33,605(1,361)(1,061)
51,076(651)(2,228)30,13327,905349
35,652
27,90563,5571,000
37,880(2,228)35,652- 19 -

Additional Cash Flow Information

Accounts

Fiscal Year Ended
March 31, 2020

Fiscal Year Ended
March 31, 2021

AmountIncreased/(Decreased)

20
4,758

72
8,643

52
3,885

4,172

-

(4,172)

751

704

(47)

Cash paid forInterest
Income taxes
Noncash investing activities
Acquisition of a subsidiary (contingent
consideration)
Acquisition of fixed assets by assuming payment
obligation(6) Notes on Going Concern
Not applicable.

(7) Basic Significant Matters in Preparation of Consolidated Financial Statements(i)

Matters Regarding the Scope of Consolidation and Application of the Equity Method

Major consolidated subsidiaries:
Wacoal Corporation, Peach John Co., Ltd., Lecien Corporation, Kyushu Wacoal Manufacturing Corp., Torica Co., Ltd., Nanasai Co.,
Ltd., Wacoal International Corp., Wacoal America, Inc., Wacoal Europe Ltd., Wacoal EMEA Ltd., Wacoal Europe SAS, Wacoal
Hong Kong Co., Ltd., Wacoal Investment Co. (Taiwan), Ltd., Wacoal China Co., Ltd., Wacoal International Hong Kong Co., Ltd.
and A Tech Textile Co., Ltd.
Major Affiliated Companies:
Shinyoung Wacoal Inc., Taiwan Wacoal Co., Ltd. and Thai Wacoal Public Co., Ltd.
(ii) Changes Regarding Subsidiaries and Affiliated Companies
Not applicable.
(iii) Standard of Preparation of Consolidated Financial Statements
The consolidated financial statements have been prepared based on terms, format and preparation methods in compliance withaccounting standards generally accepted in the United States as required in connection with the issuance of American Depositary
Receipts. For this reason, the consolidated financial statements may be different from those that have been prepared based on theConsolidated Financial Statement Regulations and the Standard of Preparation of Consolidated Financial Statements in Japan.
(iv) Significant Accounting Policiesa.

Valuation Standard of Inventories
The average cost method was mainly used for goods, products and supplies, and the first-in first-out method was used for
raw materials, with both valued at the lower of cost or market.

b.

Valuation Standard of Property, Plant and Equipment and Method of Depreciation
Property, plant and equipment are valued at the acquisition cost. Depreciation expenses are calculated mainly using thestraight-line method based on the estimated useful lives of the assets (the lease term is used for capitalized leased assets).

c.

Valuation Standard of Securities and Investments
Based on the provisions of the U.S. Financial Accounting Standards Board (“FASB”) Accounting Standards Codification(“ASC”) 320, “Investments – Debt Securities”, and ASC 321 of FASB, “Investments – Equity Securities”, marketablesecurities and investments have been classified as “debt securities” and “equity securities”, and debt securities have beenfurther classified as “available-for-sale securities” and “held-to-maturity securities”. “Available-for-sale securities” arerecorded at fair value, and “held-to-maturity securities” are recorded at amortized cost. Gain or loss on sale of marketablesecurities and investments is calculated based on cost using the moving-average method. Equity securities are measured atfair value and unrealized holding gain or loss is recorded as net profit or loss.

d.

Liabilities for Termination and Retirement Benefits
This is accounted for based on FASB ASC 715.

e.

Consumption Taxes
Consumption taxes have been excluded from sales.
- 20 -

f.

Consolidated Statements of Cash Flows
In preparing the consolidated cash flow statements, highly liquid investments with original maturities of three (3) months
or less have been included in cash and cash equivalents.

(8) Notes to the Consolidated Financial Statements(i)

Per Share Information

Net income attributable to Wacoal Holdings Corp.
Number of average shares issued during the year
Net income attributable to Wacoal Holdings Corp. per share
Diluted net income attributable to Wacoal Holdings Corp. per
share

Fiscal Year Ended
March 31, 2020
3,472 million yen
63,989,561 shares54.26 yen

Fiscal Year Ended
March 31, 2021
7,025 million yen
62,406,826 shares
112.57 yen

54.05 yen

112.09 yen(ii) Segment Informationa.

Operating Segment Information

Fiscal Year Ended March 31, 2020 (April 1, 2019 - March 31, 2020)(Millions of Yen)
Wacoalbusiness(Domestic)

Wacoalbusiness(Overseas)

Peach Johnbusiness

Other

Total

Elimination

Consolidated

Net sales(1) External customers

106,11249,808

11,224

19,616

186,760-

186,760(2) Intersegment

1,107

10,570214

5,110

17,001(17,001)-

Total

107,219

60,378

11,43824,726

203,761(17,001)

186,760

Operating costs and expenses
Impairment charges on goodwill
and other intangible assets
Total operating costs andexpenses

101,136

58,603

11,59825,319196,656(17,001)

179,655

-

282

191

-

473

-

473

101,136

58,885

11,78925,319197,129(17,001)

180,128

Operating income (loss)

6,083

1,493

(351)

(593)

6,632

-

6,632

Fiscal Year Ended March 31, 2021 (April 1, 2020 - March 31, 2021)(Millions of Yen)
Wacoalbusiness(Domestic)

Wacoalbusiness(Overseas)

Peach Johnbusiness

Other

Total

Elimination

Consolidated

Net sales(1) External customers

86,13341,355

12,20012,516

152,204-

152,204(2) Intersegment

754

8,769

219

3,827

13,569(13,569)-

Total

86,88750,124

12,41916,343

165,773(13,569)

152,204

Operating costs and expenses
Impairment charges on goodwill
and other intangible assets
Total operating costs andexpenses

86,26050,054

10,816

17,073

164,203(13,569)

150,634

-

2,673

12

-

2,685

-

2,685

86,26052,727

10,82817,073

166,888(13,569)

153,319

Operating income (loss)(Note) 1.

627(2,603)
1,591(730)(1,115)(1,115)
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,
and 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, shop design and implementation, etc.

- 21 -

2.

Matters regarding changes to operating segment:
Since the current consolidated cumulative first quarter, information on Ai Co., Ltd., which was previously 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. Also, after assessing the quantitative
criteria, we have changed our “Peach John Business”, which was previously included in our “Other” segment, to be presented asa separate reporting segment starting from the current consolidated cumulative second quarter, because it satisfied the relevant
quantitative criteria. The segment information for the previous fiscal year has been prepared based on the reporting segment
after such change.

3.

Information on assets by operating segment:
Assets attributable to our “Wacoal Business (Domestic)” segment increased by 48,027 million yen from the end of the previous
fiscal year as a result of funds borrowed during the current consolidated fiscal year. Accordingly, assets attributable to our“Wacoal Business (Domestic)” segment as of the end of the current consolidated fiscal year were 285,421 million yen.
b.

Information by Region

Fiscal Year Ended March 31, 2020 (April 1, 2019 to March 31, 2020)(Millions of Yen)I.

Elimination or
corporateJapan

Asia/Oceania

Europe/N.A.

Total

135,273

20,59630,891

186,760-

Consolidated

Net sales
External customers

186,760

II.

Operating income (loss)

5,398

(77)

1,311

6,632

-

6,632

III.

Long-lived assets

44,014

4,034

4,035

52,083-52,083Fiscal Year Ended March 31, 2021 (April 1, 2020 to March 31, 2021)(Millions of Yen)I.

Elimination or
corporateJapan

Asia/Oceania

Europe/N.A.

Total

Consolidated

109,464

16,301

26,439152,204-

152,204

Net sales
External customers

II.

Operating income (loss)

1,803

108

(3,026)(1,115)-(1,115)

III.

Long-lived assets

41,918

3,536

4,304

49,758-49,758(Note) 1.
2.

3.
4.

Countries or areas are classified according to geographical proximity.
Main countries and areas belonging to classifications other than Japan
Asia/Oceania: Asian countries and Australia
Europe/N.A.: North America and European countries
Sales in respect of consolidated companies are categorized by location.
Long-lived assets include property, plant and equipment.
c.

Overseas Sales

Fiscal Year Ended March 31, 2020 (April 1, 2019 - March 31, 2020)(Millions of Yen)I.

Overseas net sales

II.

Consolidated net sales

III.

Ratio of overseas net sales to total consolidated net sales

Asia/Oceania

Europe/N.A.

Total

20,59630,891

51,487--

186,760

11.0%

16.6%

27.6%

Asia/Oceania

Europe/N.A.

Total

16,301

26,43942,740--152,204

10.7%

17.4%

28.1%

Fiscal Year Ended March 31, 2021 (April 1, 2020 - March 31, 2021)(Millions of Yen)I.

Overseas net sales

II.

Consolidated net sales

III.

Ratio of overseas net sales to total consolidated net sales(Note) 1.
2.

Countries or areas are classified according to geographical proximity.
Main countries and areas belonging to classifications other than Japan
Asia/Oceania: Asian countries and Australia
Europe/N.A.: North America and European countries- 22 -

(iii) Status of Sales

Type of productFiscal Year Ended March 31, 2020
AmountMillions of Yen

Fiscal Year Ended March 31, 2021

Distribution ratio%

AmountMillions of Yen

Distribution ratio%

Innerwear
Foundation and lingerieNightwear
Children’s underwear
Subtotal
Outerwear/Sportswear
Hosiery
Other textile goods andrelated products
OthersTotal

144,933
7,459

77.6
4.0

122,776
6,522

80.7
4.3

1,014

0.6

749

0.5

153,406

82.2

130,047

85.5

12,746
1,563
7,545

6.8
0.8
4.0

8,836
918
5,354

5.8
0.6
3.5

11,500186,760

6.2
100.0

7,049
152,204

4.6
100.0(iv) Significant Subsequent Events
Not applicable.
- End -

- 23 -