DAIDOH LIMITED

In the apparel business, the company holds brands targeting different customer segments and price points—MOMOTARO JEANS, Brooks Brothers, NEWYORKER, and PONTETORTO—diversifying single-brand risk. The real estate leasing business (Dynacity) is a highly profitable segment boasting an operating margin of 28.1%, complementing the volatility risk of the apparel business and enhancing overall group earnings stability.

Japan Blue Co., Ltd., which became a consolidated subsidiary in August 2025, continues to grow MOMOTARO JEANS and Japan Blue Jeans at a pace exceeding initial acquisition assumptions. The incorporation of half a year's worth of results from the third quarter drove the apparel business's first operating profit in 7 fiscal periods (¥759 million), significantly contributing to the group's first overall operating profit in 13 fiscal periods (¥371 million).

The company has a history of over 145 years, having transformed its business domain in step with the times—from cotton fabric manufacturing to wool fabrics, apparel product retail, and real estate leasing utilizing former factory sites. Most recently, it sold a hotel property in Chiyoda-ku, Tokyo (March 2025) and an office building in Bunkyo-ku (September 2025, book value ¥6,042 million), applying the proceeds to M&A and shareholder returns, demonstrating a track record of agile asset utilization.

The company is accelerating new domestic store openings for MOMOTARO JEANS and Japan Blue Jeans., while planning a pop-up store opening in Paris in June 2026. Under the vision of "evolution into a global denim maison originating from Japan," the company aims to achieve dramatic growth by capturing overseas markets.

The company is promoting increased brand awareness through expanded advertising strategies and acquiring new customer segments through the development of new categories such as women's and golf lines. Sales have expanded due to the effect of product development and collaboration projects targeting the Japanese market, but profit declined year on year due to increased sale (discount) sales, making profitability improvement a key challenge.

The company implemented large-scale withdrawal from unprofitable stores and launched the new label "Park Slope NEWYOKER" in March 2026, centered on outlets and EC. It aims to improve profitability through value chain reform and organizational reform, and to revitalize the brand through a comprehensive redesign spanning product planning to sales tailored to target customers.

For fashion apparel, the company is strengthening proposal-based sales to major fast fashion brands to expand orders, while for sports apparel, it is working on developing high-performance materials aimed at cultivating major sports brands. During the current period, a steady recovery trend was confirmed, primarily in sports apparel.

Film Inc., in which the company acquired a 45% equity stake in April 2026, will be made an equity-method affiliate, with contribution to consolidated earnings expected from the second quarter of the consolidated fiscal period of FY2027 (ending March 2027). This is part of the business portfolio restructuring, including M&A.

The company positions FY2027 (ending March 2027) as the final year of its first medium-term management plan, targeting operating profit of ¥1,500 million and ROE of 8%. In FY2026 (ending March 2026), the company achieved operating profit of ¥371 million, clearing the second-year target. The full-year forecast calls for operating profit of ¥1,500 million (up 304.2% year on year).