Summary of Financial Results for the First Quarter of the Fiscal Year Ending December 31, 2025 （1,335KB）

Summary of Financial Results for the First Quarter of the Fiscal Year

Ending December 31, 2025

May 9, 2025

© 2025 KOKUYO Co.,Ltd.

Contents

1. First Quarter FY2025 Results

2. Full-Year FY2025 Forecasts

3. Results in Each Business

4. Reference Materials

   • The business segments are as follows:

     Furniture Businesses: FN Business Supply Distribution: BS Stationery Businesses: ST Interior Retail Businesses: IR

   • Unless otherwise indicated, monetary figures are rounded down to the nearest million yen.

As such, the sum of the figures in a breakdown may not match

the stated total.

Executive Summary

First Quarter FY2025 Results

• We achieved decent YoY growth in net sales, operating income, and EBITDA, and huge YoY growth in operating ratio.

• While business-supply distribution fell behind target because of delays in incorporating Fujitsu Coworco's clientele, the segments performed well overall. The leading segment was Japanese furniture, which capitalized on brisk office demand

• Overseas sales as percentage of total sales decreased year-on-year because of strong performance in the Japanese

  furniture business.

• Net income was on track, although it was down relative to the spike in the comparative period last year (when we recorded gain on sale of fixed assets).

  FY2025 Forecasts: H1 and Full-Year

• Consolidated and segment forecasts remain unchanged from what we announced on February 14, 2025.

• While we expect no direct impact from the Trump tariff policy, we continue to monitor the potential for secondary impacts

  (from economic adversities created by the tariffs) to Japan and other regions.

• Although the progress of business-supply distribution is slower than initially expected, we aim for year-on-year revenue and profit growth driven by the growth of various businesses, particularly the strong performance of Japanese furniture business.

• EBITDA will increase following investment in PP&E in Japan and other growth investments.

• Net income will decrease relative to the FY2024 high (which was on the back of the sale of cross-held shares and other non-

business assets brought forward).

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1. First Quarter FY2025 Results

   4

   
   
   

   First Quarter FY2025 Results: Year on Year Comparisons

   YoY growth in net sales, operating income, and EBITDA, and huge YoY growth in operating ratio.

   Net income down relative to spike last year (when we recorded gain on sale of fixed assets), but generally on track.

   	Jan-Mar FY2024 result	Jan-Mar FY2025 result	YoY change	% YoY change
   Net sales	96,087	99,484	+3,397 3.5%
   Gross profit	39,502	42,430	+2,928 7.4%
   (ratio)	41.1%	42.7%
   EBITDA	13,977	15,489	+1,512 10.8%
   (ratio)	14.5%	15.6%
   Operating income	11,791	13,484	+1,693 14.4%
   (ratio)	12.3%	13.6%
   Net income attributable to owners of parent	11,978	10,012	-1,966 -16.4%
   (ratio)	12.5%	10.1%
   Overseas sales as percentage of total sales	10%	9%

   (Millions of yen)

   5

   Note: In the period under review, we changed the method for presenting income (loss) on rental property and some other items. The new method has been retroactively

   applied to the Jan-Mar FY2024 results for net sales, gross profit, operating income, and EBITDA.

   First Quarter FY2025 Results: Contributors to YoY Change in Net Sales

   Overall growth was led by Japanese furniture business, which won orders on back of brisk office demand.

   In Japanese stationery business, sales declined relative to spike in comparative period (when rush demand occurred

   ahead of price hikes), but sales growth remained in line with annual target.

   Japan

   +3,754

   Overseas

   -446

   (Millions of yen)

   Reconciliation

   +89

   
   
   

   Other

Jan-Mar

FY2024 result 6

First Quarter FY2025 Results: Contributors to YoY Change in Operating Income

Profit growth was led by revenue growth and better margins in Japanese furniture businesses.

Japanese stationery business offset decreased revenue with cost reductions and price revisions.

Japan

+1,991

Overseas

-157

(Millions of yen)

Reconciliation

Reconciliation

-141

Jan-Mar FY2024 result

Foreign exchange

Jan-Mar FY2025 result 7

First Quarter FY2025 Results: Contributors to YoY Change in Operating Income

Costs increased, but we continued to enjoy the effects of price revisions in the Japanese furniture business and

Japanese stationery business.

We used strategic expenditures (including in personnel and IT infrastructure) to drive our medium- and long-term

strategies.

Gross profit

+2,928

SG&A expenses

-1,235

(Millions of yen)

Hiring more staff Across-board pay raises

Enhancing IT systems, other IT infrastructure investments

Logistics

Jan-Mar FY2024 result

Impact of higher raw materials costs

Impact of sales price revision

Impact of sales expansion

Personnel expenses

Activity expenses

Capital expenditures

IT system expenditures

Other

Jan-Mar FY2025 result

8

Cash Flow Performance

OCF decreased ¥6.7 billion YoY, reflecting change in working capital.

ICF decreased ¥4.2 billion YoY, with a differential cash flow created by the sale of non-business assets.

Balance Sheet Performance

Cash and cash equivalents decreased with negative OCF and ICF. Equity ratio increased with steady performance.

(Millions of yen)

10

1. Full-Year FY2025 Forecasts

11

Full-Year FY2025 Forecasts: Year on Year Comparisons

Forecasts remain unchanged from those initially announced, but we will keep an eye on economic developments.

We are confident that each business will post earnings growth, with the Japanese furniture business leading the growth.

(Millions of yen)

12

Note: In the period under review, we changed the method for presenting income (loss) on rental property and some other items. The new method has been retroactively

applied to the FY2024 results for net sales, gross profit, operating income, and EBITDA.

PP&E Investments and M&As

Japanese businesses will receive the bulk of investment, but we will also invest in M&As in the overseas

furniture business.

Planned investments

物流拠点の最適化

生産性向上

13

Shareholder Returns

We will deliver dividends with a payout ratio of at least 50% and buy back up to ¥20 billion in shares.

We commit to a steady buyback program, increasing stock liquidity.

Dividend (JPY), payout ratio (%)

Forecast:

40.3%

69.1%

36.1%

41.8%

40.2%

57.6%

40.1%

47.6%

50.1%

¥14.0 more to be paid

(Yen)

2021 2022 2023 2024 2025

Outlook by Segment

15

© 2025 KOKUYO Co., Ltd.

Furniture Businesses: Change in Performance

Goal: Increase net sales and operating income again by converting leads efficiently amid a brisk market.

Q1: We capitalized on the brisk office demand in Japan.

(Millions of yen)

Net sales EBITDA Operating income

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025

Note: In the period under review, we changed the method for presenting income (loss) on rental property and some other items. The new method has been retroactively applied to the Jan-Mar FY2024 results for net sales, operating income, and EBITDA.

16

© 2025 KOKUYO Co., Ltd.

Business Supply Distribution: Change in Performance

Goal: Increase earnings with growth in purchasing system for large-scale clients (Benri Net).

Q1: Performance was negatively affected by delays in incorporating Fujitsu Coworco's clientele.

(Millions of yen)

Net sales EBITDA Operating income

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025 17

Stationery Businesses: Change in Performance

Goal: Increase net sales and operating income with investments aligned with medium- and long-term strategies.

Q1: Performance in Japan and China was in line with expectations. In India, we experience intense competition.

(Millions of yen)

Net sales EBITDA Operating income

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025

Jan-Mar 2024 Jan-Mar 2025

18

Interior Retail: Change in Performance

Goal: Strengthen e-commerce and B2B sales to enable huge growth in operating income.

Q1: Despite impact of higher personnel costs, e-commerce and B2B sales were steady and in line with expectations.

(Millions of yen)

Net sales EBITDA Operating income

5,389

5,078

Jan-Mar 2024 Jan-Mar 2025

2025 1-3

2024 1-3

3.4%

2.8%

Jan-Mar 2024 Jan-Mar 2025

5.0%

4.1%

Jan-Mar 2024 Jan-Mar 2025 19

4. Reference Materials

20

© 2025 KOKUYO Co., Ltd.

Framework for building our organization's value 21

Use dynamic and aggressive growth-CapEx (PP&E investments, M&As) to maximize cash flows in the medium and long term. Strike optimal balance between cashflow generation, risks, and sustainable growth to further boost overall value.

3

Bolster strategic assets to reduce risks and boost capacity for sustained growth over the medium and long term

Use strategies and

2 investments to create sustained EBITDA growth

Grow profit over medium

1 and long term, maximize overall value

Key points

21

Financial Targets in Fourth Medium-Term Plan

The plan sets out targets for net sales, overseas sales as a percentage of total sales, EBITDA, and ROE.

The targets represent our commitment to sustaining EBITDA growth and maximizing the organization's value.

2023

result

2024

result

Latest target for 2025

2027

target

2030

target/projection

22

Enhancing the Business Portfolio

Through groupwide strategic management, we are building a smarter business portfolio that will deliver

sustained growth in 2030 and beyond.

High ② Maintain growth, improve profitability

2027

① Top priority

2027

Sales growth rate

• Develope-commerce

• ExpandB2B

• Expand residential services

2027

8.8 bn

Business supply distribution

• Gain competitive advantage in

e-commerce

• Further improve to Japanese

  Furniture

business

• Expand from China to ASEAN

• Penetrate Australia and India

2024

2024

2024

6.2 bn

• Build purchase-management platform

2027

9.7 bn

2024

8.0 bn

• Grow businesses in India and ASEAN

• Build learning style brand

• Develop global products

• The larger the circle, the larger the EBITDA

• Dashed lines indicate trajectory in runup to 2030

• Underlined text indicates synergy themes

Low

④ Clarify position

③ Explore fresh growth options

Low

Profitability = EBITDA margin

EBITDA margin (both for Japan and overseas businesses) indicates the margin before G&A expenses (expenses not tied to a particular department or business)

High

① Top priority: Use growth CapEx to drive growth

② Maintain growth, improve profitability:

Use growth CapEx to drive growth and improve profitability over longer term

③ Explore fresh growth options: Find cash cows and growth opportunities and allocate

growth CapEx to them

④ Clarify position: Consider selling off or disinvesting if unfeasible to move

© 2025 KOK

to other quadrant or synergize with other business

23

UYO Co., Ltd.

Capital Allocations

We will invest actively to drive sustained growth.

We will also deliver generous shareholder returns to improve stakeholder engagement.

Capital allocations over the 3-year

period of the 4th medium-term plan

Borrowing

Growth CapEx

70.0 bn

Maintenance CapEx

19.0 bn

Shareholder returns

64.0 bn

Cash on hand needed as reserve

62.0 bn

PP&E and system investments in Japan

Growth CapEx

• Improvements in productivity and logistics, purchase-management platform

  Investments in existing businesses overseas

• Supply chain improvements, insourcing of global products

  M&A

• Expansion in / penetration of Australian, Indian, and ASEAN markets, leading industry innovation globally (we may borrow further funds for M&As, depending on the prospective deals).

  Maintenance CapEx

• Upgrading of production and logistics PP&E

• Upgrading of IT systems

  Shareholder returns

  Dividends

• Steadily-increasing dividend, Benchmark payout ratio of 50%

  Buybacks

• Buy back ¥35.0 bn of shares

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Furniture Business: Medium- and Long-Term Strategy

Build business model integrating upstream and downstream supply chain in Japan and overseas

Globally optimize production and distribution by focusing on components and optimizing production locations

Strategy to leverage spatial design excellence and talent, global workstyle strategy

Start offering building renovation services

Start offering office management services (e.g. office team evaluation)

Japan

Planning

phase

Design

f n

inalizatio

Office layout

phase

Office

ma ent

nagem

phase

phase

Life le

• Better workstyle research

• Better workplace

consultation service

• Live-office building

• Process in place for need-identification survey and proposal package

• Pitching products tied to upstream pitches

• Products that enable

spatial design pitches

Globally develop strengths and knowledge in Japan

Office Cyc

Overseas

Existing business field

• We will build a business model whereby we expand the business field to deliver customer experience value across the whole of the office life cycle (upstream to downstream), thereby forging lasting relationships with customers.

  Global product strategy

• We will bolster our system for developing designer's-choice global products for the Japanese market and Asian markets.

• In Japan, we will invest in production and logistics PP&E to boost capacity. We will also overhaul our global production network to achieve the QCD performance necessary to expand in ASEAN.

Mother plant Sub-Plant

Assembly site

25

Concentrated production and export of core components (Lamex Dongguan Plant)

Business Supply Distribution: Medium- and Long-Term Strategy Purchasing Platform Strategy

Use technological innovation to deliver personalized shopping experiences through Benri Net

(platform for purchase-management services)

Enhancing platform functions by linking with big-name e-commerce sites

• We will enhance the core Benri Net platform's linkage with the following big-name e-commerce sites and trading companies.

• This platform strategy will create an upward spiral of continual growth in both linked suppliers and customers.

  Using AI to enhance customer experience value

• We will use AI to derive industry- and customer-specific recommendations for products selected from the largest B2B merchandise lineup, and expand Share of Wallet.

• Product recommendations will be sent at the necessary times based

  on purchase history, reducing purchasing time.

  Asset-light business model that offers convenience and huge product lineup to wide range of customers

  Industry-specific trading companies

  Locally rooted suppliers

  Company E

  Printing

Company D

Company C

Company B

Company A

Suppliers,

e-commerce sites

Users

Technology used to send personalized recommendations to target users

Supplies products

••

26

Stationery Business: Medium- to long-term strategy Campus Brand Strategy

We will accelerate business growth in India and expand our share in ASEAN markets to increase overseas sales share (percentage of total sales). We will also transition our existing business portfolio into a more profitable enterprise by reducing COGS in products for developing globally.

Overseas sales

erseas

Ov

Global product sales share Gross profit margin in global

Global products Other products

products

27

Interior Retail Business: Medium- to long-term strategy Strategy to Expand Customer Base

• Kokuyo & Actus: We will strengthen our partnership in sales and product development, with a 2030 goal of a 7-fold increase (from 2024 level) in office-related sales.

• At Orgatec Tokyo 2024, Actus exhibited a booth that recreated a live office. We will start using this booth for sales promotion.

• In November, we opened an Actus exhibition space in our Tokyo showroom. We will use it to showcase our services to our corporate customers.

• Actus is exclusive importer of Poliform, a top Italian brand that is a

  world leader in interior design

• Goal for 2030 is to win deals in approx. 60 premium apartment complexes (the target segment)

• We will grow the residential business by bolstering design office accounts.

Actus booth

at Orgatec Tokyo 2024

Actus exhibition space at Kokuyo's

Tokyo showroom

2023:

Conceptual photograph of system delivered in Azabudai Hills Residence

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First Quarter Performance

(Millions of yen)

First Quarter Performance by Segment

(Millions of yen)