Pola Orbis : Summary of Financial Results for Fiscal 2025 First Quarter

For the First Quarter of Fiscal Year Ended December 31, 2025 (Consolidated)

These financial statements have been prepared in accordance with accounting principles and practices generally accepted in Japan. The following English translation is based on the original Japanese-language document.

Listing: Tokyo Stock Exchange, Prime Market (Code No.: 4927) URL: https://www.po-holdings.co.jp/

Representative: Yoshikazu Yokote, Representative Director And President

Contact: Naoki Kume, Director, Finance Tel: +81-3-3563-5517

Start of Cash Dividend Payment: －

Supplemental Materials Prepared for Quarterly Financial Results: Yes

Conference Presentation for Quarterly Financial Results: Yes(for analysts)

May 9, 2025

1. Consolidated Performance for the First Three Months of Fiscal 2025

   (January 01, 2025-March 31, 2025)

   1. Consolidated Operating Results

      (Amounts less than one million yen have been truncated)

      (Percentage figures indicate year-on-

      year change)

      	Net Sales		Operating Income		Ordinary Income		Profit Attributable to Owners of Parent
      FY2025 Three Months FY2024 Three Months	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%
      	41,313 40,886	1.0 (3.0)	4,148 3,357	23.5 (26.2)	2,470 4,675	(47.1) (3.2)	1,310 3,126	(58.1) 14.0

      Note: Comprehensive income: ¥1,921 million (-30.9%) for the three months ended March 31, 2025;

      ¥2,780 million (1.4%) for the three months ended March 31, 2024

      	Net Income Per Share	Diluted Net Income Per Share
      	Yen	Yen
      FY2025 Three Months	5.92	5.92
      FY2024 Three Months	14.13	14.12

   2. Consolidated Financial Position

      	Total Assets	Net Assets	Equity Ratio	Net Assets Per Share
      	Millions of yen	Millions of yen	%	Yen
      FY2025 First Quarter	190,142	159,977	84.0	721.83
      FY2024	200,320	164,916	82.2	744.16

      Reference: Equity capital: FY2025 First Quarter: ¥159,719 million; FY2024: ¥164,656 million

2. Dividends

   	Annual Cash Dividends Per Share
   	Q1-end	Q2-end	Q3-end	Year-end	Total
   FY2024 FY2025	Yen	Yen	Yen	Yen	Yen
   	－ －	21.00	－	31.00	52.00
   FY2025 (Forecast)		21.00	－	31.00	52.00

   Note: Revisions to the cash dividends forecast announced most recently: none

3. Consolidated Performance Forecast for Fiscal Year Ending December 31, 2025

   (January 01, 2025-December 31, 2025)

   (Percentage figures indicate year-on-year change)

   	Net Sales		Operating	Income	Ordinary Income		Profit Attributable to Owners of Parent		Net Income Per Share
   	Millions of yen	%	Millions of yen	%	Millions of yen	%	Millions of yen	%	Yen
   Full year	174,000	2.1	14,500	5.0	14,700	(8.6)	8,500	(8.5)	38.42

   Note: Revisions to the consolidated performance forecast announced most recently:none

   Notes to Summary Information

   1. Changes in significant subsidiaries during the current period

      (Changes in specific subsidiaries resulting in changes in the scope of consolidation) : None

   2. Application of special accounting methods for the preparation of the quarterly consolidated financial statements : None

   3. Changes in accounting policies, accounting estimates, and restatement

      1. Changes in accounting policies associated with revision of accounting standards : Yes

      2. Changes other than (3)-1) : None

      3. Changes in accounting estimates : None

      4. Restatements : None

   4. Number of shares issued and outstanding (common stock)

      1. Number of shares issued and outstanding at the end of each period (including treasury stock) At March 31, 2025 229,136,156 shares

         At December 31, 2024 229,136,156 shares

      2. Number of shares of treasury stock at the end of each period

         At March 31, 2025 7,865,338 shares

         At December 31, 2024 7,870,726 shares

      3. Average number of shares issued and outstanding in each period Three months ended March 31, 2025 221,267,177 shares

Three months ended March 31, 2024 221,241,296 shares

Note: The number of shares of treasury stock at the end of each period includes the Company's shares held by the officer compensation Board Incentive Plan (BIP) trust (341,210 shares at March 31, 2025, 344,998 shares at December 31, 2024). The number of shares of treasury stock deducted in the calculation of average number of shares outstanding during each period includes the Company's shares held by BIP trust (344,051 shares in the three months ended March 31, 2025, 232,807 shares in the three months ended March 31, 2023).

Information Regarding Quarterly Review Procedures

The quarterly financial results report is exempt from quarterly review by certified public accountants or accounting firms.

Explanation of Appropriate Use of Performance Forecast and Other Special Items

This report contains projections of performance and other projections based on information currently available and certain assumptions judged to be reasonable. Actual performance may differ materially from these projections resulting from changes in the economic environment and other risks and uncertainties. For performance projections, please refer to "1. Qualitative Information on Consolidated Performance for the First Quarter of Fiscal 2025 (3) Explanation of Consolidated Performance Forecast and Other Predictive Information" on page 5.

Table of Contents

1. Qualitative Information on Consolidated Performance for the First Quarter of Fiscal 2025……………… 2

   1. Explanation of Consolidated Operating Results 2
   2. Explanation of Consolidated Financial Position ………………………………………………………… 4
   3. Explanation of Consolidated Performance Forecast and Other Predictive Information 5

2. Quarterly Consolidated Financial Statements 6

   1. Consolidated Balance Sheets 6
   2. Consolidated Statements of Income and Consolidated Statements of Comprehensive Income 8
   3. Notes to Consolidated Financial Statements 10

1. Qualitative Information on Consolidated Performance for the Three Months of Fiscal 2025
   1. Explanation of Consolidated Operating Results

During the three months of fiscal 2025 (January 1-March 31, 2025), despite a moderate recovery in the Japanese economy, factors such as trade policies in the United States have led to market uncertainties. In terms of personal consumption, although consumer sentiment declined mainly due to ongoing price hikes, there are signs of recovery thanks to continued improvements in the employment and income environment..

In the domestic cosmetics market, personal consumption has improved thanks to the moderate economic recovery. Moreover, inbound demand continues to exceed that of the previous year. In the Chinese market, although supply has increased as policy measures take hold, the economy has remained stagnant

Within this market environment, as part of its medium-term management plan (from 2024 to 2026) that started in 2024, the POLA ORBIS Group (the "Group") implemented four business growth strategies, namely, "strengthen the customer base in the domestic business to achieve sustainable growth and improve profitability," "further grow the overseas business and establish business bases in new markets," "achieve profitability through growth in brands under development, contributing to sustainable earnings," and "enhance the brand portfolio and expand business domains." At the same time, in effort to sustainably strengthen the management foundations that will support these strategies, the Group has worked to "strengthen R&D capabilities for new value creation" and "strengthen sustainability combining the resolution of social issues with uniqueness."

As a result of the above, the Group's consolidated operating results for the three months of fiscal 2025 were as follows.

Consolidated net sales for the three months of fiscal 2025 increased 1.0% year on year to ¥41,313 million, due mainly to an increase in revenue from the flagship ORBIS brand. Operating income increased 23.5% year on year to ¥4,148 million due mainly to an increase in gross profit from higher net sales, while ordinary income decreased 47.1% year on year to ¥2,470 million due to foreign exchange losses. As a result of the factors noted above, profit attributable to owners of parent decreased 58.1% year on year to ¥1,310 million.

Operating Results Overview (Millions of yen)

Three Months Ended March 31

2024 2025

Year-on-Year

Amount Change Percent Change (%)

Operating Results by Segment

Net Sales (Segment Sales to External Customers) (Millions of yen)

Three Months Ended March 31

2024 2025

Year-on-Year

Amount Change Percent Change (%)

Segment Profit (Loss) (Operating Income (Loss)) (Millions of yen)

Three Months Ended March 31

2024 2025

Year-on-Year

Amount Change Percent Change (%)

Profit (Note)

Total ¥3,357 ¥4,148 ¥790 23.5

Note: Reconciliations of segment profit refer to elimination of profits arising from inter-company transactions and expenses not allocated to reportable segments. Please see note 2 in "1. Information about Net Sales and Profit (Loss) by Reportable Segment" on page 11 and 12 for the details of reconciliations of segment income during the period.

Beauty Care

The Beauty Care segment consists of the flagship brands POLA and ORBIS, the overseas brand Jurlique, and the brands under development DECENCIA, THREE and FUJIMI.

POLA is working to establish a business base to return to a growth trajectory. In the domestic business, we are working to accelerate sales growth among growth stores in the consignment sales channel and achieve further business growth in other sales channels. Overall performance in the domestic business exceeded that of the previous year, due in part to a rise inunit purchase price from the strategic roll out of WRINKLE SHOT SERUM DUO, which was launched in January. In the overseas business, we are continuing to establish our brand presence in China, our priority market, by expanding contact points with high-prestige customers and strengthening CRM. However, due to the continued impact of the economic slowdown in some areas of Asia, particularly in China, the overall performance of the overseas business fell short of that of the previous year. As a result, POLA brand net sales decreased year on year. However, thanks to our ongoing work to optimize costs in the domestic business, operating income increased year on year.

ORBIS is proceeding with initiatives that focus on customer retention and higher lifetime value as it aims for an even higher profit structure. In the domestic business, the direct selling channel for highly functional, higher-priced products including brightening serum and UV care products performed strongly, contributing to a rise in unit purchase price. In the external channels, customer touchpoints are increasing as a result of effort such as the steady expansion of sales channels for the specialty product ORBIS SHOT PLUS, and strong sales continued. In the overseas business, the overall performance fell short of that of the previous year due to the continued impact of the economic slowdown in some areas of Asia, particularly in China. As a result of the above, ORBIS brand net sales and operating income exceeded those of the previous year.

Jurlique continues to work toward business growth in the markets of Asia, mainly in Australia and in China. In Australia, the home country of the brand, although the e-commerce channels performed well, overall performance fell below that of the previous year due to sluggish sales in the department store and directly operated retail store channels. In China, the effects of the economic slowdown continued, hampering sales in both the department store and ecommerce channels, leading to weaker performance than that of the previous year. As a result of the above, Jurlique brand net sales fell below those of the previous year. However, thanks to organizational structure reforms and appropriate control of selling and administrative expenses, operating losses improved.

For brands under development, DECENCIA is working to build a stable customer structure to achieve further growth. Customer retention is improving thanks to the reinforcement of sales strategies tailored to customer attributes, and results were higher than the previous year. Efforts are underway to regenerate THREE. We are focusing on