Script of Financial Results Briefing 2025(The 2nd Quarter)

Q2 Financial Results Briefing for the Fiscal Year Ending December 2025 August 21, 2025

(Total: 63 minutes, Presentation: 53 minutes, Q&A: 10 minutes)

Tetsuya Nakayama President

Atsushi Kazumi Director, General Manager of the Business Management Department and General Manager of the Digital Service Strategy Department and Orange Book Department

Mayumi Takada Manager of Corporate Planning

Atsushi Shimozu Manager of Accounting Department

Kyoko Yoshimi Manager of Public Relations & Investor Relations, Corporate Planning Department

Mika Takahashi Public Relations & Investor Relations Section, Corporate Planning Department

First, I would like to introduce today's attendees. Mr. Tetsuya Nakayama, President.

For today's Q&A session, we will take questions from those in the audience first and then those online. The video of today's briefing will be posted on our official YouTube channel at a later date.

Next, Nakayama, President, will explain the Company's initiatives. President Nakayama, please.

Today is the occasion for the announcement of financial results, and while business performance is affected by the market environment, I have recently come to believe that it is really greatly influenced by the management beliefs of the Company. Therefore, today, I would like to share with you our management beliefs and thoughts on management.

上記スライドの右下に「当社にて作成」の文言を追記

I have distributed various materials to you today, but I would like you to take a look at the last page of the A4 booklet titled "management creed that supports business performance."

A chart comparing the performance of listed peer companies is attached. I hope you take a look.

This is a chart comparing the performance of listed peer companies, and if you look at the second column from the left, it shows sales figures for this January to June. As you can see, I think you can see that the difference between our company and the competitors is so great that it is hard to believe that they are comparable in the same industry.

In the past, when the industry was influenced only by the market environment, the industry average was 10% positive or 10% negative, and the figures were generally similar across the board. There were some ups and downs, but it used to be mostly because of how some of them did well or how things were going, but as you can see in this chart, there is a high level of disparity that cannot be explained by the market environment alone.

In particular, if you look at the far right, the pre- and post-COVID-19 performance comparison, I think it would actually be accurate to say that the Company's sales were down 3% due to the 2021 COVID-19 strike, and stayed at that level. Other companies' performance was down 12%, 17%, or even a maximum of 33%. The extent of the impact varied greatly from company to company.

Also, as shown in the post-pandemic recovery status on the far right, while we have achieved a 34% increase, some other companies have not even recovered to the pre-pandemic level. I think the reality is that we are now in a situation that cannot be explained simply by immediate sales and profits and the market environment.

I believe that this disparity is caused by the disparity in management beliefs about what kind of company a company should be. I have recently come to realize that business performance is not a matter of chance. I

believe that even if a splendid medium-term management plan is prepared, it will be a mere picture, as it will not have a soul unless management beliefs are taken into account.

Another unfortunate fact, which may be a bit hard to hear for some, is that the Company's performance is not at all in line with the stock market's evaluation of the Company. We have always been told and taught that stock prices are a mirror of business performance, but the current situation, which is not at all in accordance with the textbooks, is making us distrustful. I would like to ask you all if companies with high PR have that much future potential, and I would very much like to see the stock market become healthier.

Now, I would like to explain according to the resume. First, please refer to page one.

The management creed number one is, "a business and a company are only a business if it is useful to people and society," and I believe that a company's corporate aspirations are still necessary. I believe that any company should consider what the Company is for, not just to sell, to make money, or to increase the market capitalization of its shares. I would like to operate such a business while being aware that we are a member of society.

The second one is, "companies have an obligation to provide a safe and stable workplace for their employees." Because of our policy of regular employees and the principle of no non-regular employment, we do not have dispatched workers, which is very rare in this day and age, In addition, the principle of lifetime employment is said not to be popular these days, but since we are prepared to take charge of each person's life, I think the Company should be one that allows employees to work until retirement, if possible.

For those of you who may not know, our retirement age is 68, now. Then there is an extension of employment until age 73, and beyond that, part-timers can work until age 78, which may be uncommon in general. When you get close to 78 years old, you can continue working a little longer if you want to, but generally, everyone says, "please give me a break", but it is important to enable new graduates to work for a long period of time.

In addition, although there are many career hires these days, our basic policy is to hire new graduates. As I mentioned earlier, we have extended the retirement age, and we also have a number of unique personnel