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Core Growth Drivers for First Half Results

• Increased new store openings led to higher store counts and successful acquisition of new customers
• Strong hiring performance since the second half of the previous period reduced opportunity loss at existing stores
• The "Tsukiichi Discount Campaign" launched alongside price adjustments shortened customer visit cycles, with an average 30% of customers using the campaign over the last 3 months

Domestic Operational Highlights

• Store expansion: 15 new stores opened as planned, 3 scheduled closures were relocated without time lag to minimize customer outflow. Opened QB PREMIUM stores in high-footfall station-connected locations in Tokyo and Kanagawa, and opened FaSS in the Takanawa Gateway area to strengthen the brand base outside of QB HOUSE. The company focuses on a dominant strategy to increase regional competitiveness, rather than just increasing store count.
• Hiring and placement: Experienced hiring hit 73 hires against a 56-person plan, driven by increased interest from job seekers in their 40s and 50s seeking stable employment amid industry-wide bankruptcies. Trainee hiring hit 60 hires against a 67-person plan (slightly behind plan) due to delayed start dates for post-national exam new graduates, but total hiring was 10 people ahead of plan overall. Store placement was 16 people ahead of plan, and trainee development is generally on track.
• Workforce stability: Full-time employee turnover saw a temporary increase in Q1, but fell back to planned levels in Q2.

Overseas Operational Highlights

• Singapore: Completed strategic store consolidation, conversion to QB PREMIUM, and cost cutting, returning to profitability and growing both revenue and visitor count. Testing flexible location-specific pricing and introduced high-margin fade cut services at 3 QB PREMIUM locations to differentiate via technical skill and expand access to higher-income customers.
• Taiwan: Sustained double-digit growth, established a new training center in Taichung in July 2025 to strengthen talent development, and opened the first store in Kaohsiung in November 2025 to expand coverage to southern Taiwan, building it into a core growth pillar for the medium term.
• Hong Kong: Implemented a 14.2% price increase (from HKD 70 to HKD 80) in January 2025, revenue grew steadily year-over-year, but customer count recovery is slower than planned, which the company views as a temporary post-price-adjustment phase.
• United States: Implemented a 16.7% price increase (from USD 30 to USD 35) in January 2025, revenue grew more than 10% year-over-year, but new store opening-led customer distribution offset existing store customer declines, leaving total visitor count flat.
• New expansion markets: - Canada: Opened the 2nd store in Toronto's Union Station PATH underground mall, will open additional stores in the second half to reach 3 stores by year end. - Vietnam: Reached 4 stores in Ho Chi Minh City as planned, focused on clustered opening to build awareness and improve operational efficiency. - Malaysia: Opened the 2nd store in Kuala Lumpur ahead of plan, will open 2 more stores in the second half to reach 4 stores by year end, leveraging Singaporean operational and training expertise.

• Domestic store opening: Annual net store growth of 27 stores is still expected to be achieved as planned, despite scheduled closures in the second half, via relocation to higher-competitiveness locations. The company will continue to focus on both quantity and quality of openings to drive stable domestic growth and strengthen the profit base.
• Overseas store opening: Full-year opening is expected to hit 17 stores against the original 19-store plan, with 1 store each in the US and Canada delayed to next fiscal year to prioritize location quality. Overall progress for building an overseas growth base remains on track.
• Domestic new graduate hiring: Progress is on plan, the company will renew hiring content and increase the number of admission guidance sessions in the second half, expand the number of partner vocational beauty schools, and improve awareness of its education and career support framework for inexperienced candidates.
• Domestic customer app development: Additional development is ongoing based on test operation data, with a phased regional rollout scheduled to start in summer 2026. The app aims to improve pre-visit convenience, build ongoing customer engagement, increase loyalty and strengthen competitive advantage.
• Taiwan: Implemented a 14.3% price increase (from TWD 350 to TWD 400) in January 2026 after first rolling out a queuing system to improve convenience, which is expected to hold customer attrition to ~8% and deliver ~6% revenue growth. All station stores in Taipei have switched to fully cashless operation to improve operational efficiency.
• Hong Kong customer count recovery: Will strengthen digital marketing centered on the customer app, run targeted promotions aligned with store-specific customer characteristics, introduce service evaluation surveys to continuously improve service quality, and roll out proven Japanese initiatives such as local corporate collaborations to acquire new customers and accelerate recovery.
• United States customer count recovery: Will leverage the expanding Manhattan store network, strengthen social media outreach of service examples and location information, improve service quality via technical training, and extend operating hours and expand reservation functions starting in late March to increase visit opportunities.
• Medium-term KPI: Core medium-term KPIs remain unchanged, though higher inflation has increased cost pressure (especially for rent and personnel). One additional domestic price adjustment is still planned over the current medium-term plan period, with price adjustments rolling out sequentially overseas, and the company is preparing necessary strategies for the second half of the plan. The 300 annual hires and 35 net annual store growth targets for the final year of the medium-term plan remain on track to be achieved, and hiring is progressing as expected.

1. Consolidated overall: Revenue is 13.481 billion yen (107.1% of the previous year), operating profit is 866 million yen (119.7% of the previous year), net profit is 502 million yen (120.3% of the previous year). This represents year-over-year growth in both revenue and profit. 2. Domestic business: Operating profit is 835 million yen, with a 120 million yen year-over-year increase. Cumulative half-year revenue is 105.9% of the previous year (Q1: 105.7% YoY, Q2: 106.1% YoY), cumulative visitor count is 104.1% of the previous year (Q1: 103.7% YoY, Q2: 104.6% YoY). 15 new stores were opened in the first half, with a net increase of 11 stores. Revenue contribution: Domestic business accounts for approximately 96.4% of total consolidated operating profit. 3. Overseas business: Operating profit is 30 million yen, with a 22 million yen year-over-year increase. Key segment details: - Singapore: Turned around from a loss in the previous period, contributing 28 million yen in profit growth. - Hong Kong and US: Price increases drove revenue growth, contributing 15 million yen in profit growth. - Taiwan: Sustained double-digit growth, supporting overall overseas profit expansion. - New markets (Canada, Vietnam, Malaysia): Increased upfront investment created a 23 million yen year-over-year profit headwind. - Exchange rate: Yen depreciation added approximately 2 million yen in profit. Revenue contribution: Overseas business accounts for approximately 3.5% of total consolidated operating profit.

• Trainee hiring missed the first half plan due to increased delays in start dates for new graduates who passed the autumn national licensing exam
• Post-price adjustment customer count recovery is slower than planned in Hong Kong, and remains offset by new store distribution in the US, requiring targeted recovery efforts
• Two overseas store openings (one in the US, one in Canada) will be delayed to the next fiscal year due to the company's strategic decision to prioritize location quality
• Inflation has pushed up rent and personnel costs, which are the company's primary cost components, requiring adjustments to pricing strategy
• The in-development domestic customer app currently has identified usability issues for stylists, particularly related to cut card clarity and operational efficiency, which require improvement before full rollout
• Full-time employee turnover saw a temporary above-plan increase in Q1, requiring further analysis of root causes and implementation of improvement measures to hit the full-year 6.5% target

Q: Inflation has become more pronounced since the medium-term management plan was formulated. Has your view of the target KPIs changed?

A: It is true that prices are rising currently, so some review of pricing strategy may be necessary. We still plan to implement one more domestic price adjustment over the course of the medium-term plan, and will continue rolling out price adjustments sequentially overseas as previously discussed. As digitalization progresses through the second half of the medium-term plan, we will continue preparing implementable initiatives including updated pricing strategy.

Q: How has the gap between current performance and the 2029 target KPI changed, from your perspective?

A: Our business model uses very few resources, and our main costs are rent and personnel costs. Inflation's impact on stylists' cost of living has been an important priority for the medium-term plan from the beginning, so our core key KPIs have not changed meaningfully.

Q: What issues have you identified in the test operation of the new customer app, and what has matched or exceeded your expectations?

A: At this stage, we have identified many issues. In some test stores, around half of customers have downloaded and used the app, so utilization is higher than we expected. On the other hand, we need to improve the phrasing and presentation of cut card information to make it easier for stylists to understand, to improve consistency and quality. Improving operational efficiency is core to our business model, so the most important priority is reducing time spent on operations and redirecting that effort to improving service quality.

Q: Can we expect the medium-term plan targets of 300 annual hires and 35 net new stores per year to be back on track next fiscal year?

A: Both targets are progressing on schedule for achievement in the final year of the plan. We will not hit 35 net new stores next fiscal year, but we remain on track to hit the target by the final year, and we are seeing positive momentum for the hiring target.

Q: Can you share more detail on the planned functions and expected benefits of the new app?

A: We plan to roll out functions in stages. First, we will digitalize the currently analog Tsukiichi Discount Campaign. We also added a function to let customers accurately check their previous visit history, addressing the common issue of unclear past haircut length settings that creates misalignment between customers and stylists. The app's cart function lets stylists record customer preferences and characteristics, so repeat customers can get their usual style with minimal explanation. We are also adding an app-connected queuing system, which addresses the core pain point of long wait times by letting customers wait outside the store at locations with available space, reducing customer wait stress and improving operational efficiency. We are already localizing app functions to meet market needs in overseas markets (for example, offering external queuing in Hong Kong), and we plan to eventually integrate optimal functions into a single global app.