LIXIL : Consolidated Financial Results for the First Half Ended September 30, 2025 (International Financial Reporting Standards)

Telephone: +81-50-1790-5041

(Amounts less than one million Japanese yen are rounded)

1. Consolidated Financial Results for the H1 of FY Ending March, 2026 (April 1 through September 30, 2025)

   1. Consolidated Operating Results (Percentages indicate year-on-year changes)

      	From Continuing Operations
      	Revenue		Core earnings		Operating profit		Profit before tax		Profit
      	Million yen	%	Million yen	%	Million yen	%	Million yen	%	Million yen	%
      FYE 2026 H1	735,942	△0.5	16,862	60.4	11,407	15.5	4,459	9.1	3,899	-
      FYE 2025 H1	739,775	1.0	10,511	18.9	9,880	49.0	4,087	54.5	△3,810	-

      	Including Discontinued Operations
      	Profit		Profit attributable to owners of the parent		Total comprehensive income		Basic earnings per share	Diluted earnings per share
      	Million yen	%	Million yen	%	Million yen	%	Yen	Yen
      FYE 2026 H1	3,899	-	3,355	-	32,119	-	11.67	11.67
      FYE 2025 H1	△3,794	-	△3,932	-	△17,828	-	△13.69	△13.69

      Note: Core earnings is calculated by deducting the cost of sales and selling, general and administrative expenses (SG&A) from revenue.

   2. Consolidated Financial Position

   	Total assets	Total equity	Equity attributable to owners of the parent	Ratio of equity attributable to owners of the parent to total assets
   	Million yen	Million yen	Million yen	%
   FYE 2026 H1	1,867,417	639,394	636,571	34.1
   FYE 2025	1,830,804	620,070	617,886	33.7

2. Cash Dividends

   	Annual dividends per share
   	End of Q1	End of Q2	End of Q3	End of period	For the year
   	Yen	Yen	Yen	Yen	Yen
   FYE 2025	-	45.00	-	45.00	90.00
   FYE 2026	-	45.00
   FYE 2026 (forecast)			-	45.00	90.00

   Note: Revision of dividends forecast after the recent announcement: None

3. Consolidated Forecast for the FY Ending March, 2026 (April 1, 2025 through March 31, 2026)

(Percentages indicate year-on-year changes)

Note: Revision of consolidated operating performance forecast after the recent announcement: None

* This financial results report is exempt from review conducted by certified public accountants or an audit firm.

1. Overview of Operating Results ....................................................................................................................................................

2. Consolidated Financial Statements …........................................................................................................................................

   1. Consolidated Statement of Financial Position ….........................................................................................................

   2. Consolidated Statements of Profit or Loss and Comprehensive Income ............................................................ Consolidated Statement of Profit or Loss ........................................................................................................................

      Consolidated Statement of Comprehensive Income ..................................................................................................

   3. Consolidated Statement of Changes in Equity .............................................................................................................

   4. Consolidated Statement of Cash Flows ............................................................................................................................

   5. Notes related to Financial Statements .............................................................................................................................

(Notes related to Going Concern Assumptions) ........................................................................................................... (Segment Information) ............................................................................................................................................................

1. Overview of Operating Results

   An overview of operating results and financial position for the first half (six months ended September 30, 2025) is presented in the supplementary financial results material.

   The supplementary financial results material "H1 Results for the Fiscal Year Ending March 31, 2026 (IFRS) (From April 1, 2025 to September 30, 2025)" has been posted on TDnet and the Company's website on October 31, 2025.

2. Consolidated Financial Statements

   1. Consolidated Statement of Financial Position

      (Unit: Millions of yen)

      	As	of	March 31, 2025	(As	End of H1 of September 30, 2025)
      ASSETS
      Current assets:
      Cash and cash equivalents	Y	123,527		Y	118,916
      Trade and other receivables		283,914			287,249
      Inventories		243,926			257,926
      Contract assets		17,861			19,438
      Income taxes receivable		1,691			2,318
      Other financial assets		7,176			7,464
      Other current assets		22,993			21,540
      Subtotal	701,088			714,851
      Assets held for sale	153			1,939
      Total current assets	701,241			716,790
      Non-current assets:
      Property, plant and equipment	365,552			359,288
      Right-of-use assets	63,530			64,561
      Goodwill and other intangible assets	545,561			567,723
      Investment property	2,406			2,468
      Investments accounted for using the equity method	7,561			9,832
      Other financial assets	60,994			64,711
      Deferred tax assets	80,145			79,124
      Other non-current assets	3,814			2,920
      Total non-current assets	1,129,563			1,150,627
      Total assets	Y	1,830,804		Y	1,867,417

      (Unit: Millions of yen)

      	As	of	March 31, 2025	(As	End of H1 of September 30, 2025)
      LIABILITIES AND EQUITY
      LIABILITIES
      Current liabilities:
      Trade and other payables	Y	246,802		Y	246,188
      Bonds and borrowings		190,337			171,907
      Lease liabilities		19,786			20,665
      Contract liabilities		9,850			12,487
      Income taxes payable		8,129			9,439
      Other financial liabilities		4,437			4,914
      Provisions		1,156			2,430
      Other current liabilities		91,286			87,753
      Total current liabilities	571,783			555,783
      Non-current liabilities:
      Bonds and borrowings	402,209			430,322
      Lease liabilities	45,468			45,362
      Other financial liabilities	29,581			28,606
      Net defined benefit liabilities	72,975			77,896
      Provisions	6,595			9,139
      Deferred tax liabilities	75,628			73,960
      Other non-current liabilities	6,495			6,955
      Total non-current liabilities	638,951			672,240
      Total liabilities	1,210,734			1,228,023
      EQUITY
      Share capital	68,654			68,807
      Capital surplus	221,587			221,562
      Treasury shares	-138			-140
      Other components of equity	121,146			149,294
      Retained earnings	206,637			197,048
      Equity attributable to owners of the parent	617,886			636,571
      Non-controlling interests	2,184			2,823
      Total equity	620,070			639,394
      Total liabilities and equity	Y	1,830,804		Y	1,867,417

      (2) Consolidated Statements of Profit or Loss and Comprehensive Income

      Consolidated Statement of Profit or Loss

      (Unit: Millions of yen)

      	Six months ended September 30, 2024		Six months ended September 30, 2025
      Continuing operations
      Revenue	Y	739,775	Y	735,942
      Cost of sales		-498,585		-484,042
      GROSS PROFIT		241,190		251,900
      Selling, general and administrative expenses		-230,679		-235,038
      Other income		3,455		4,144
      Other expenses		-4,086		-9,599
      OPERATING PROFIT		9,880		11,407
      Finance income		2,120		1,950
      Finance costs		-7,842		-8,719
      Share of loss of associates accounted for using the equity method		-71		-179
      PROFIT BEFORE TAX FROM CONTINUING OPERATIONS		4,087		4,459
      Income tax expenses		-7,897		-560
      PROFIT (LOSS) FROM CONTINUING OPERATIONS Discontinued operations PROFIT FROM DISCONTINUED OPERATIONS	-3,810 16		3,899 -
      PROFIT (LOSS) Profit (loss) attributable to:		-3,794		3,899
      Owners of the parent
      Continuing operations		-3,948		3,355
      Discontinued operations		16		-
      Total		-3,932		3,355
      Non-controlling interests		138		544
      PROFIT (LOSS)	Y	-3,794	Y 3,899

      (Unit: Yen)

      	Six months ended September 30, 2024	Six months ended September 30, 2025
      Earnings (Losses) per share
      Basic (yen per share)
      Continuing operations	-13.75	11.67
      Discontinued operations	0.06	-
      Total	-13.69	11.67
      Diluted (yen per share)
      Continuing operations	-13.75	11.67
      Discontinued operations	0.06	-
      Total	-13.69	11.67

      Consolidated Statement of Comprehensive Income

      (Unit: Millions of yen)

      	Six months ended September 30, 2024		Six months ended September 30, 2025
      PROFIT (LOSS) OTHER COMPREHENSIVE INCOME	Y	-3,794	Y	3,899
      Items that will not be reclassified subsequently to profit or loss
      Net fair value gain (loss) on equity instruments measured through other comprehensive income		-869		2,898
      Remeasurements of defined benefit pension plans		105		-21
      Total of items that will not be reclassified to profit or loss		-764		2,877
      Items that may be reclassified subsequently to profit or loss
      Exchange differences on translation of foreign operations		-12,065		23,552
      Net fair value gain (loss) on hedging instruments entered into for cash flow hedges		-1,203		1,618
      Share of other comprehensive income of associates accounted for using the equity method		-2		173
      Total items that may be reclassified subsequently to profit or loss	-13,270		25,343
      Other comprehensive income, net of tax	-14,034		28,220
      TOTAL COMPREHENSIVE INCOME Total comprehensive income attributable to:		-17,828		32,119
      Owners of the parent		-18,059		31,486
      Non-controlling interests		231		633
      TOTAL COMPREHENSIVE INCOME	Y	-17,828	Y 32,119

      1. Consolidated Statement of Changes in Equity

         (Unit: Millions of yen)

         	Equity attributable to owners of the parent
         	Share capital	Capital surplus	Treasury shares	Other components of equity
         				Net fair value gain (loss) on equity instruments measured through other comprehensive income	Remeasurements of defined benefit pension plans	Exchange differences on translation of foreign operations	Net fair value gain (loss) on hedging instruments entered into for cash flow hedges
         BALANCE AS OF APRIL 1, 2024	68,530	221,632	-126	16,743	-	107,390	1,443
         Profit (loss) Other comprehensive income	- -	- -	- -	- -869	- 105	- -12,158	- -1,203
         Total comprehensive income	-	-	-	-869	105	-12,158	-1,203
         Purchase of treasury shares	-	-	-5	-	-	-	-
         Disposal of treasury shares	-	-0	0	-	-	-	-
         Share-based payment transactions	124	-71	-	-	-	-	-
         Dividends Changes in interests in subsidiaries	-	-	-	-	-	-	-
         that do not result in the Group losing	-	-29	-	-	-	-	-
         control over the subsidiaries Transfers from other components of equity to retained earnings	-	-	-	-2	-105	-	-
         Total transactions with owners	124	-100	-5	-2	-105	-	-
         BALANCE AS OF SEPTEMBER 30, 2024	68,654	221,532	-131	15,872	-	95,232	240
         BALANCE AS OF APRIL 1, 2025	68,654	221,587	-138	16,295	-	104,296	558
         Profit (loss) Other comprehensive income	- -	- -	- -	- 2,898	- -21	- 23,463	- 1,618
         Total comprehensive income	-	-	-	2,898	-21	23,463	1,618
         Purchase of treasury shares	-	-	-2	-	-	-	-
         Disposal of treasury shares	-	-0	0	-	-	-	-
         Share-based payment transactions	153	-19	-	-	-	-	-
         Dividends Changes in interests in subsidiaries	-	-	-	-	-	-	-
         that do not result in the Group losing	-	-6	-	-	-	-	-
         control over the subsidiaries Transfers from other components of equity to retained earnings	-	-	-	-4	21	-	-
         Total transactions with owners	153	-25	-2	-4	21	-	-
         BALANCE AS OF SEPTEMBER 30, 2025	68,807	221,562	-140	19,189	-	127,759	2,176

         (Unit: Millions of yen)

         	Equity attributable to owners of the parent				Non-controlling interests	Total equity
         	Other components of equity		Retained earnings (losses)	Total
         	Other	Total
         BALANCE AS OF APRIL 1, 2024	2	125,578	226,897	642,511	1,827	644,338
         Profit (loss) Other comprehensive income	- -2	- -14,127	-3,932 -	-3,932 -14,127	138 93	-3,794 -14,034
         Total comprehensive income	-2	-14,127	-3,932	-18,059	231	-17,828
         Purchase of treasury shares	-	-	-	-5	-	-5
         Disposal of treasury shares	-	-	-	0	-	0
         Share-based payment transactions Dividends Changes in interests in subsidiaries	- -	- -	- -12,922	53 -12,922	- -	53 -12,922
         that do not result in the Group losing	-	-	-	-29	29	-
         control over the subsidiaries Transfers from other components of equity to retained earnings	-	-107	107	-	-	-
         Total transactions with owners	-	-107	-12,815	-12,903	29	-12,874
         BALANCE AS OF SEPTEMBER 30, 2024	0	111,344	210,150	611,549	2,087	613,636
         BALANCE AS OF APRIL 1, 2025	-3	121,146	206,637	617,886	2,184	620,070
         Profit (loss)	-	-	3,355	3,355	544	3,899
         Other comprehensive income	173	28,131	-	28,131	89	28,220
         Total comprehensive income	173	28,131	3,355	31,486	633	32,119
         Purchase of treasury shares	-	-	-	-2	-	-2
         Disposal of treasury shares	-	-	-	0	-	0
         Share-based payment transactions	-	-	-	134	-	134
         Dividends Changes in interests in subsidiaries	-	-	-12,927	-12,927	-	-12,927
         that do not result in the Group losing	-	-	-	-6	6	-
         control over the subsidiaries Transfers from other components of equity to retained earnings	-	17	-17	-	-	-
         Total transactions with owners	-	17	-12,944	-12,801	6	-12,795
         BALANCE AS OF SEPTEMBER 30, 2025	170	149,294	197,048	636,571	2,823	639,394

      2. Consolidated Statement of Cash Flows

      (Unit: Millions of yen)

      	Six months ended September 30, 2024		Six months ended September 30, 2025
      OPERATING ACTIVITIES:
      Profit before tax from continuing operations	Y	4,087	Y	4,459
      Profit before tax from discontinued operations		23		-
      Profit before tax		4,110		4,459
      Depreciation and amortization		41,825		40,952
      Impairment losses		254		2,650
      Interest and dividend income		-1,546		-1,767
      Interest expense		6,047		5,627
      Gain from remeasurement relating to application of the equity method		-		-1,647
      Share of (profit) loss of associates accounted for using the equity method		71		179
      Losses (gains) on disposal of property, plant and equipment		-50		375
      Decrease (increase) in trade and other receivables		22,505		1,016
      Decrease (increase) in inventories		-4,441		-8,795
      (Decrease) increase in trade and other payables		-7,703		-2,844
      (Decrease) increase in net defined benefit liabilities		-578		351
      Other		-13,168		1,181
      Subtotal		47,326		41,737
      Interest received		857		1,009
      Dividends received		747		808
      Interest paid		-5,848		-5,903
      Income taxes paid		-2,691		-7,647
      Net cash generated by operating activities	Y	40,391	Y 30,004

      (Unit: Millions of yen)

      	Six months ended September 30, 2024		Six months ended September 30, 2025
      INVESTING ACTIVITIES:
      Decrease (increase) in time deposits	Y	279	Y	1,235
      Purchase of property, plant and equipment		-15,510		-12,944
      Proceeds from disposal of property, plant and equipment		473		362
      Purchase of intangible assets		-5,200		-4,775
      Decrease (increase) in short-term loans receivable		5,135		110
      Purchase of investments		-56,038		-102,995
      Proceeds from sale and redemption of investments		56,031		103,074
      Payments for absorption-type company split		-2,362		-
      Payments for acquisition of subsidiaries		-85		-
      Other		534		-796
      Net cash used in investing activities	Y	-16,743	Y	-16,729
      FINANCING ACTIVITIES:
      Dividends paid	Y	-12,922	Y	-12,927
      (Decrease) increase in short-term borrowings and commercial paper		-11,951		-17,003
      Proceeds from long-term borrowings		36,189		85,387
      Repayment of long-term borrowings		-76,705		-38,017
      Proceeds from issuance of bonds		35,835		-
      Redemption of bonds		-		-25,000
      Lease liabilities paid		-10,891		-11,511
      Other		-1		-3
      Net cash used in financing activities	Y	-40,446	Y	-19,074
      INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS	-16,798		-5,799
      CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR	124,485		123,527
      EFFECTS OF EXCHANGE RATE CHANGES ON THE BALANCE OF CASH AND CASH EQUIVALENTS HELD IN FOREIGN CURRENCIES	-599		1,188
      CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	Y	107,088	Y 118,916

      (5) Notes related to Financial Statements

      (Notes related to Going Concern Assumptions)

      Not applicable.

      (Segment Information)

      1. Description of Reportable Segments

      The Group's reportable segments are those for which discrete financial information is available among the Group's constituent units and regular evaluation by the Board of Directors is performed in order to decide how resources are allocated and performance is assessed. The Group is managed based on three reportable segments consisting of the "Water Technology Business" , the "Housing Technology Business" and the "Living Business" with the performance of their respective business units reported to the Board of Executive Officers or Board of Directors. The "Water Technology Business" includes manufacturing and sales of sanitaryware, faucets, bathroom fixtures, and other items. The "Housing Technology Business" includes manufacturing and sales of sashes, doors, shutters, curtain walls, and other items and provides services such as proposals for housing solutions and management of real estate. The "Living Business" includes manufacturing and sales of kitchen, vanity and wooden interior materials.

      Change in reporting segment classification

      In the fiscal year ended March 31, 2025, the Group reported in two segments, which include "Water Technology Business" and "Housing Technology Business". However, from the first quarter of the fiscal year ending March 31, 2026, the Group has decided to change to report in three segments, which include "Water Technology Business", "Housing Technology Business", and "Living Business". The reason for the reporting segments change is that the Group has established the new segment, "Living Business", by integrating the kitchen and washstand cabinet unit business from the "Water Technology Business" and the wooden interior materials business from the "Housing Technology Business". These businesses share many similarities in terms of products, manufacturing processes, and business models. This integration is part of the Group's focus on its strategic initiative to improve profitability of the Japan business and strengthen the Group's business structure, while also providing new value to end users. As a change, kitchen and washstand cabinet unit business, previously included in the "Water Technology Business," and the wooden interior materials business, previously included in the "Housing Technology Business," will be classified under the "Living Business" in the new segments. The segment information for the six months ended September 30, 2024, is presented based on the new reportable segments classification.

      2. Methods of measurement for the amounts of revenue and profit or loss for each reportable segment

      The accounting policies of each reportable segment are consistent with those for the preparation of the consolidated financial statements. Profit or loss for reportable segments is presented on the basis of core earnings or losses. Intersegment revenue or transfers are determined based on market prices.

3. Information on the amounts of revenue, profit or loss, and other items for each reportable segment For the six months ended September 30, 2024 (April 1 through September 30, 2024)

(Unit: Millions of yen)

For the six months ended September 30, 2025 (April 1 through September 30, 2025)

(Unit: Millions of yen)

(Notes)

1. Segment profit is core earnings which are defined as revenue less cost of sales and selling, general and administrative expenses.

2. A process of Segment profit reconciliations takes place for Company expenses that are not allocated to reportable

segments. These expenses primarily represent costs associated with administrative departments, including Human Resources, General Affairs, Finance and other departments of the Company.