1Q FY2025 Financial Results Briefing Summary of President’s Remarks

August 5, 2025

In previous years, we have held results briefings twice a year, one for the first half of the fiscal year and one for the full year. However, understanding that there remains a high degree of interest in our efforts under the Reform Action Plan in light of Fuji TV's recent situation, we have decided to hold a briefing for the first quarter of this fiscal year as well.

The topics presented today will be the "Financial Results for the First Quarter and Future Outlook" and the "Reform Action Plan and Future Management Directions."

Let me begin with the financial results for the first quarter and future outlook.

In the consolidated financial results for the first quarter, a year-on-year decrease in net sales and an operating loss were recorded due to a decline in broadcasting revenue resulting from the impact of the Fuji TV incidents.

In the Media & Content Segment overall, a decrease in net sales and an operating loss were recorded due to the decrease in broadcasting revenue resulting from the impact of the Fuji TV incidents, among other factors.

Fuji TV on a non-consolidated basis saw strong performances in the Content Business, including its digital, animation and event businesses. However, the Broadcasting & Media Business suffered significant declines- particularly in broadcasting and streaming advertising revenues-due to the incidents, and Fuji TV recorded an

operating loss.

BS Fuji also recorded decreases in net sales and operating income due to a decline in advertising revenue resulting from the impact of the incidents, while Pony Canyon recorded a decrease in net sales and an operating loss due to the lack of hit animation titles and the reduced scale of events.

At dinos, although net sales declined due to weakness in its core furniture and storage category, financial results improved, with an increase in operating income and a return to profitability, continuing the trend from Q4 of the previous fiscal year. This was thanks to appropriate management of SG&A expenses, including the streamlining of catalog publication and content review, which have been underway since last year.

The Urban Development, Hotels & Resorts Segment recorded a major increase in net sales and an increase in operating income.

THE SANKEI BUILDING recorded increases in both net sales and operating income due to strong performance in both leasing and sales of residences, offices, and other properties.

In the leasing business, all of the diverse asset types performed strongly in terms of both occupancy rates and rents. In particular, the LEFOND PROGRES series of residences, Caption by Hyatt Namba Osaka and other hotels, and tourism facilities contributed to these favorable results.

In the sales business as well, sales of LEFOND-brand new condominiums and the sales of logistics facilities and residential facilities were strong during the quarter.

GRANVISTA Hotels & Resorts recorded increases in both

net sales and operating income due to continued strong domestic and inbound tourism demand, which resulted in firm ADR and occupancy rates.

In particular, ADR and occupancy rates at INTERGATE HOTELS Tokyo Kyobashi and Osaka Umeda exceeded the previous year's levels, due to their capturing inbound tourism demand. Kobe Suma Sea World, which opened in June last year, also made a positive contribution for the full year.

The consolidated financial results for the period were as I have just described primarily because of the Fuji TV incidents.

Now I will explain our full-year outlook.

Regarding Fuji TV's broadcasting revenue, ad placement trends that were difficult to forecast at the start of the fiscal year have gradually become clearer, so we have revised our forecasts for Q2 and the second half. I am pleased to say that, since last week, we have received continued reports that national clients will be resuming their advertising. This trend is expected to help accelerate the pace of recovery.

As a result of the revision to Fuji TV's broadcasting revenue forecast, consolidated net sales, operating income and ordinary income are now expected to fall short of our previous forecasts. However, net income attributable to owners of the parent is expected to be maintained at the prior forecast level, as gains on the sale of investment securities are anticipated from the reduction of strategic shareholdings set out in the Reform Action Plan.

We will steadily progress the initiatives in the Reform Action Plan aimed at restoring trust and promoting growth, which I will present next, and strive to help ensure the gradual recovery in advertising demand.

With regard to shareholder returns, under our policy of paying stable dividends with a consolidated dividend payout ratio of 50%, the initial forecast dividend of ¥50 remains unchanged.

Next, I will talk about future management directions, including the Reform Action Plan.

There are four key points: "human capital-driven management," "proactive business transformation," "capital optimization for medium-to-long-term value creation," and "transition to governance-focused management."

Today I will concentrate on two areas of particular interest: "proactive business transformation" and "capital optimization for medium-to-long-term value creation."

To achieve our target of ROE of 8% or higher, we will work to expand profits and enhance corporate value with the aim of increasing PBR.

Under our "proactive business transformation," the first step is to evolve Fuji TV into a true content company. To this end, in July we made major organizational changes to shift the structure from a broadcasting-centered model to a content-centered one.

Regarding the Urban Development, Hotels & Resorts Segment, we are considering various options under review by the Board of Directors from the perspectives of enhancing medium- to long-term corporate value and maximizing collective benefits for shareholders.

In terms of "capital optimization for medium-to-long-term value creation," with a view to our future business directions, we will carefully assess the required equity capital and aim to achieve a significant reduction in the equity base (denominator). Aligned with "proactive

business transformation," and reviewing our business portfolio to expand growth areas, we will actively replace assets and review their allocation, and we will direct any consequent gains to shareholder returns and growth investments.

Strategic shareholdings are, of course, included in this effort. Under our policy to divest over ¥100 billion in strategic shareholdings within three years, we sold ¥19.5 billion in the first quarter. We will continue these divestments on an ongoing basis, with comprehensive consideration given to the rationale for each holding and our funding needs.

With regard to share repurchases, assuming a recovery in business conditions, we expect to repurchase shares totaling over ¥100 billion by FY2029. This will contribute to the improvement of capital efficiency and shareholder returns, so we will actively advance this plan. In light of the emerging recovery in Fuji TV's advertising revenue, and taking into account the balance with working capital and growth investments, we have begun examining the timing and scale of repurchases from the standpoint of appropriate asset allocation.

As I have just presented, we will press ahead with reforms to simultaneously restore trust and achieve growth, with the aim of meeting your expectations.