Interim report
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Note: This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy between this translated document and the Japanese original, the original shall prevail. October 14, 2026 Consolidated Financial Results for the Fiscal Year Ended August 31, 2026 [Japanese GAAP] Company name: U-NEXT HOLDINGS Co., Ltd. Stock exchange listing: Tokyo Stock Exchange Code number: 9418 URL: https://unext-hd.co.jp/ Representative: Yasuhide Uno, President, Representative Director & CEO Contact: Sho Nishimoto, Executive Officer & CFO Phone: +81-3-6823-7015 Scheduled date of Annual General Meeting of Shareholders: November 27, 2026 Scheduled date of commencing dividend payments: November 30, 2026 Scheduled date of filing annual securities report: November 26, 2026 Availability of supplementary briefing materials on financial results: Available Schedule of financial results briefing session: Scheduled (for analysts and institutional investors) (Amounts are rounded down to the nearest million yen.) 1. Consolidated Financial Results for the Fiscal Year Ended August 31, 2026 (September 1, 2025 – August 31, 2026) (1) Consolidated Operating Results (% indicates changes from the previous corresponding period.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Fiscal year ended Million yen % Million yen % Million yen % Million yen % August 31, 2026 469,957 20.4 30,255 (4.2) 28,169 (8.8) 14,959 (18.7) August 31, 2025 390,408 19.5 31,571 8.5 30,900 9.1 18,395 19.8 (Note) Comprehensive income: Fiscal year ended August 31, 2026: ¥16,663 million [(14.0)%] Fiscal year ended August 31, 2025: ¥19,379 million [21.3%] Basic earnings per share Diluted earnings per share Return on equity Ratio of ordinary profit to total assets Ratio of operating profit to net sales EBITDA Adjusted EPS Fiscal year ended Yen Yen % % % Million yen % Yen % August 31, 2026 82.93 – 14.5 9.2 6.4 46,071 5.9 103.74 (13.9) August 31, 2025 101.99 – 20.5 12.6 8.1 43,500 10.0 120.44 17.4 (Reference) Equity in earnings (losses) of affiliates: Fiscal year ended August 31, 2026: ¥85 million Fiscal year ended August 31, 2025: ¥55 million (Notes) 1. Information on diluted earnings per share is not provided as there were no shares with dilutive effect. 2. The Company conducted a 3 -for-1 stock split of common shares effective as of December 1, 2024. Accordingly, the figures for basic earnings per share are calculated assuming that the stock split was conducted at the beginning of the fiscal year ended August 31, 2025. (2) Consolidated Financial Position Total assets Net assets Equity ratio Net assets per share Million yen Million yen % Yen As of August 31, 2026 354,335 125,053 30.9 606.21 As of August 31, 2025 259,782 108,708 37.6 540.94 (Reference) Equity: As of August 31, 2026: ¥109,344 million As of August 31, 2025: ¥97,571 million
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(3) Consolidated Cash Flows Cash flows from operating activities Cash flows from investing activities Cash flows from financing activities Cash and cash equivalents at year- end Fiscal year ended Million yen Million yen Million yen Million yen August 31, 2026 23,743 (44,240) 25,633 62,836 August 31, 2025 20,671 (20,178) 3,501 56,882 2. Dividends Annual Dividend Total dividends (annual) Dividend payout ratio (consolidated) Ratio of dividends to net assets (consolidated) 1st quarter- end 2nd quarter- end 3rd quarter- end Year-end Total Yen Yen Yen Yen Yen Million yen % % Fiscal year ended August 31, 2025 – 7.00 – 8.50 15.50 2,795 15.2 3.1 Fiscal year ended August 31, 2026 – 8.50 – 8.50 17.00 3,066 20.5 3.0 Fiscal year ending August 31, 2027 (Forecast) – 9.50 – 9.50 19.00 20.8 3. Consolidated Financial Results Forecast for the Fiscal Year Ending August 31, 2027 (September 1, 2026 – August 31, 2027) (% indicates changes from the previous corresponding period.) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Basic earnings per share Million yen % Million yen % Million yen % Million yen % Yen Full year 524,000 11.5 32,500 7.4 30,700 9.0 16,500 10.3 91.47 EBITDA Adjusted EPS Million yen % Yen % Full year 53,100 15.3 112.54 8.5 * Notes: (1) Significant changes in the scope of consolidation during the period: Yes Newly included: 1 (XING INC.), Excluded: – ( ) (Note) For details, please refer to “( 5) Notes to Consolidated Financial Statements (Change in the scope of consolidation or the scope of adoption of the equity method)” on page 15 of the Attachments. (2) Changes in accounting policies, changes in accounting estimates and retrospective restatement 1) Changes in accounting policies due to the revision of accounting standards: None 2) Changes in accounting policies other than 1) above: None 3) Changes in accounting estimates: None 4) Retrospective restatement: None (3) Total number of shares issued and outstanding (common shares) 1) Total number of shares issued and outstanding at the end of the year (including treasury shares): August 31, 2026: 180,375,333 shares August 31, 2025: 180,375,333 shares 2) Total number of treasury shares at the end of the year: August 31, 2026: 423 shares August 31, 2025: 423 shares
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3) Average number of shares during the year: Fiscal year ended August 31, 2026: 180,374,910 shares Fiscal year ended August 31, 2025: 180,374,987 shares (Note) The Company conducted a 3 -for-1 stock split of common shares effective as of December 1, 2024. Accordingly, the total number of shares issued and outstanding at the end of the year, the total number of treasury shares at the end of the year, and the average number of shares during the year have been calculated assuming that the stock split was conducted at the beginning of the fiscal year ended August 31, 2025. (4) Calculation method of management indices EBITDA: Operating profit + Depreciation + Amortization of goodwill * The amounts of depreciation and amortization of goodwill represent figures on the Statements of Cash Flows. Adjusted EPS: Adjusted profit (i.e., Profit attributable to owners of parent + Amortization of goodwill) / Average number of shares during the period
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(Reference) Summary of Non-Consolidated Financial Results Non-Consolidated Financial Results for the Fiscal Year Ended August 31, 2026 (September 1, 2025 – August 31, 2026) (1) Non-Consolidated Operating Results (% indicates changes from the previous corresponding period.) Net sales Operating profit Ordinary profit Profit Fiscal year ended Million yen % Million yen % Million yen % Million yen % August 31, 2026 15,261 9.0 7,303 8.4 5,772 (1.8) 5,055 8.9 August 31, 2025 14,003 (13.7) 6,737 (20.6) 5,876 (27.4) 4,640 (40.7) Basic earnings per share Diluted earnings per share Fiscal year ended Yen Yen August 31, 2026 28.03 – August 31, 2025 25.73 – (Notes) 1. Information on diluted earnings per share is not provided as there were no shares with dilutive effect. 2. The Company conducted a 3 -for-1 stock split of common shares effective as of December 1, 202 4. Accordingly, the figures for basic earnings per share are calculated assuming that the stock split was conducted at the beginning of the fiscal year ended August 31, 2025. (2) Non-Consolidated Financial Position Total assets Net assets Equity ratio Net assets per share Million yen Million yen % Yen As of August 31, 2026 156,943 51,923 33.1 287.86 As of August 31, 2025 122,787 49,892 40.6 276.60 (Reference) Equity: As of August 31, 2026: ¥51,923 million As of August 31, 2025: ¥49,892 million * These consolidated financial results are outside the scope of audit by certified public accountants or an audit firm. * Explanation on the proper use of financial results forecast and other notes (Notes on forward-looking statements, etc.) The earnings forecasts and other forward -looking statements herein are based on information available to the Company and certain assumptions deemed reasonable as at the date of publication of this document, and the Company does not in any way guarantee the achievement of the projections. In addition, actual results may differ significantly from these forecasts due to various factors. For preconditions for the fina ncial results forecast and notes on the use thereof, etc., please refer to “1. Overview of Operating Results, etc. (4) Future Outlook” on page 6. Supplementary briefing materials on financial results for the fiscal year ended August 31, 2026 will be filed on TDnet on October 1 4, 2026, and also posted on the Company’s website. The Company plans to hold a financial results briefing session for institutional investors on October 15, 2026.
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1 Table of Contents - Attachments 1. Overview of Operating Results, etc. ...................................................................................................... 2 (1) Overview of Operating Results for the Fiscal Year under Review ...................................................... 2 (2) Overview of Financial Position for the Fiscal Year under Review ...................................................... 5 (3) Overview of Cash Flows for the Fiscal Year under Review ................................................................ 6 (4) Future Outlook ..................................................................................................................................... 6 2. Basic Policy on Selection of Accounting Standards .............................................................................. 7 3. Consolidated Financial Statements and Principal Notes ....................................................................... 8 (1) Consolidated Balance Sheets ............................................................................................................... 8 (2) Consolidated Statements of Income and Comprehensive Income ..................................................... 10 Consolidated Statements of Income................................................................................................... 10 Consolidated Statements of Comprehensive Income......................................................................... 11 (3) Consolidated Statements of Changes in Net Assets ........................................................................... 12 (4) Consolidated Statements of Cash Flows ............................................................................................ 14 (5) Notes to Consolidated Financial Statements ...................................................................................... 15 (Notes on going concern assumption) ................................................................................................. 15 (Change in the scope of consolidation or the scope of adoption of the equity method) ...................... 15 (Segment information, etc.) ................................................................................................................. 15 (Per share information) ........................................................................................................................ 20 (Significant subsequent events) ........................................................................................................... 20
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2 1. Overview of Operating Results, etc. (1) Overview of Operating Results for the Fiscal Year under Review Driven by the aspiration to make the future even better for everyone in society through entertainment and technology, the Group has adopted the corporate slogan “NEXT for U” and continues to strive to become a corporate group that earns the trust and meets the expectations of more people. The Group’s business comprises the following four business segments: the Content Distribution Business which consists of multiple services including “U -NEXT,” which distributes videos, e-books, etc., primarily to individual users, the Store & Facility Solu tion Business through which we offer digital transformation (DX) solutions and music distribution services as well as automated payment machines and commercial karaoke services, among others, to commercial stores and facilities, such as medical institutions and hotels, the Communication & Energy Business through which we offer ICT solutions such as internet connection, high- and low-voltage electricity, etc. to commercial stores, small - to medium -sized offices, among others, and the Financial, Realty & Global Business through which we offer various services, including guarantee, cashless payment, insurance, etc. mainly to commercial stores, sell equipment and provide brokerage services to realty businesses, as well as manage commercial buildings on our own. The Group believes that its greatest asset is its diverse customer base built through business-to-business (B to B) and business-to-consumer (B to C) businesses, comprising commercial stores, medical institutions, hotels, small- to medium-sized offices, and individuals, among others. As important management themes, the Group is focusing its efforts on enhancing services that meet market needs and offering them as one -stop solutions to assist with and solve customers’ management issues in a comprehensive manner in B to B business and delivering valuable experiences to more users through expanded lineup of content and bundled services, and enhanced service quality in B to C business. During the fiscal year under review, the environment surrounding the Company saw signs of a recovery in consumer spending as the employment and income situations continued to improve. Meanwhile, the outlook remains uncertain due to soaring resource and energy prices caused by the materialization of geopolitical risks, concerns about inflation driven by the prolonged weakness of the yen, as well as interest rate trends. Under these circumstances, the Group will aim to maintain and expand the earnings base for the Group as a whole by drawing on its diversified business portfolio and executing flexible strategies either at individual business units or across the Group to respond to rapidly changing business environments. In addition, to strengthen the sustainability as a company, the Group has focused on building organizations that foster leaders of the next generation. At the same time, the Group has also strived to establish organizations and systems that enable it to continuously provide innovative services in response to various needs and issues of its customers. Furthermore, based on the belief that the most important management resources for a company’s sustainable growth are its human resources, the Group has also made an effort to create an employee-friendly environment. As part of the effort, the Group has raised compensation levels for younger employees with the aim of increasing competitiveness in the employment market and enhancing employee engagement. Going forward, we will continue investing in the younger generation, who will shoulder the responsibility of shaping the future. As a result, regarding the financial results for the fiscal year under review, net sales were ¥469, 957 million (up 20.4% year on year), operating profit was ¥30,255 million (down 4.2% year on year) and ordinary profit was ¥28,169 million (down 8. 8% year on year). In addition, profit attributable to owners of parent was ¥1 4,959 million (down 18.7% year on year). The Group’s net sales (including inter-segment sales or transfers) and operating profit by segment are outlined below.
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3 <Content Distribution Business> The Content Distribution Business is operated by U -NEXT Co., Ltd. and Y .U-mobile Co., Ltd., our consolidated subsidiaries, and provides and sells “U -NEXT,” a distribution platform service of videos and e - books, among others, and “U-NEXT MOBILE” and “y.u mobile,” our own MVNO services. As of October 2026, “U-NEXT,” which provides abundant titles with unlimited viewing, offers more than 500,000 video titles such as movies and drama series, including rental titles, over 1.37 million e-books, including comics and book titles, 210 magazines, and more than 4,700 children’s books. “U -NEXT,” which allows users to seamlessly enjoy watching and reading with a single app, offers an entertainment experience crossing the borders of genres. During the fiscal year under review, we rolled out “World Golf Pack,” which is a package that provides comprehensive access to the world ’s major golf tours and tournaments, in December 2025. In June 2026, “MOTIONCRAFTS,” our original content for kids, won the top prize in the non-fiction category for ages 7 to 10 at PRIX JEUNESSE, an international festival of children ’s TV programs that is considered to be the “Academy Award for children’s programming.” In terms of external partnerships and M&As, we launched “Rakuten Saikyo U -NEXT” in alliance with Rakuten Mobile, Inc. in October 2025. In April 2026, we established StudioMonowa, Inc. as a joint venture with South Korean entertainment company CJ ENM Co., Ltd. and TBS Holdings, Inc. to further strengthen our content lineup. In June of the same year, we acquired animation production company GoHands CO., LTD. as a wholly owned subsidiary, to further strengthen and add layers to our revenue structure through IP -related businesses. In August, we entered into a comprehensive strategic partnership agreement with NBCUniversal, one of the world’s leading media and entertainment companies, covering Japan. Going forward, we will continue to build a solid business foundation by expanding the lineup of attractive content, in addition to strengthening IP-related businesses and businesses in adjacent fields that have high affinity with our existing services. As a result, net sales and operating profit of the Content Distribution Business for the fiscal year under review were ¥144,460 million (up 12.5% year on year) and ¥11,276 million (up 16.9% year on year), respectively. <Store & Facility Solution Business> The Store & Facility Solution Business is operated by the following consolidated subsidiaries: USEN CORPORA TION, USEN-ALMEX INC., USEN Camera Solutions Co., Ltd., USEN FIELDING Co., Ltd., USEN Techno-Service Co., Ltd., WannaEat CO., LTD., USEN Contact Center Co., Ltd., U’S MUSIC Co., Ltd., USEN MEDIA PROMOTION Co., Ltd., and XING INC. This is a business that contributes to both enhancing operational efficiency and increasing sales by providing comprehensive and practical solutions to management issues faced by a wide variety of stores and facilities including restaurants and retail stores. The main services for stores include a music distribution service, which has been offered for more than 60 years since its founding and holds an overwhelming share of the domestic market, as well as DX services, including “USEN Regi,” a POS cash register, “USEN AIR Series,” commercial Wi-Fi that requires no installation work, “USEN Camera,” an IP camera, and “USEN Signage,” digital signage. The primary services for facilities, such as leisure hotels, business hotels, hospitals, clinics, and golf courses, include manufacture, sales, and maintenance of automated payment machines, automated reception machines for returning patients, guidance display machines, etc. and provision of hotel management systems. Furthermore, in the karaoke business, which we added through M&A in April 2026, we manufacture and sell commercial karaoke equipment for karaoke boxes and night economy venues under the “JOYSOU ND” brand. We have established a multi -dimensional service delivery system by drawing on the expertise we have accumulated throughout our business history and the organic collaboration of multiple highly specialized companies in the Group. Primary initiatives we rolled out during the fiscal year under review in our efforts to promote store DX services included the launch, in December 2025, of “USEN Ticket & Pay,” a self -ordering kiosk for restaurants jointly developed by LG Electronics Japan Inc. and USEN CORPORA TION. This product is a solution that combines
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4 functions of a ticket vending machine and a self-payment machine and simultaneously addresses the restaurant industry’s needs to achieve labor savings and higher average spending per customer. In May 2026, we launched “Glass Level Detection Service” and “USEN AI Restaurant Manager,” new services for restaurants that utilize AI. The “Glass Level Detection Service” uses an AI sensor camera mounted on a serving robot to detect and determine how much is left in the glass at customer tables in real time and prompts customers to order their next drink, thereby helping increase sales at client restaurants. The “USEN AI Restaurant Manager” uses AI agents specializing in restaurant management to help improve the efficiency of restaurant operations based on the accumulated data from restaurants. Going forward, we aim to contribute to the further development of our customers by promoting digitalization and utilization of AI in the operation of stores and facilities and creating an environment where employees who work there can focus on their duties that require hospitality. As a result, net sales and operating profit of the Store & Facility Solution Business for the fiscal year under review were ¥110,614 million (up 14.0% year on year) and ¥16,849 million (up 3.0% year on year), respectively. <Communication & Energy Business> The Communication & Energy Business is operated by the following consolidated subsidiaries: USEN NETWORKS Co., Ltd., USEN ICT Solutions CORPORATION, USEN Smart Works CORPORATION, TACT INC., U-MX Co., Ltd., USEN WORKING Co., Ltd., USEN WORK WELL Co., Ltd., and U-NEXT Co., Ltd. in charge of the communication business, and U-POWER Co., Ltd. in charge of the energy business. In the communication business, USEN ICT Solutions CORPORATION and USEN Smart Works CORPORA TION provide ICT solution services to corporate customers as multi -service vendors under the “USEN GATE02” brand, to meet growing needs for stable , high-quality leased lines, security enhancements, remote access, groupware and other services. USEN NETWORKS Co., Ltd. provides services to commercial stores and individuals such as “USEN Hikari,” an optical line service provided by the company, “USEN NET,” an ISP service, and a next-generation IP telephone service. We place a particular focus on selling optical lines for commercial stores provided by USEN NETWORKS Co., Ltd. as an infrastructure service to facilitate cross- selling of DX services offered by our Store & Facility Solution Business. In the energy business, we offer “U-POWER” and “USEN Electricity” services as an electricity retailer and have been promoting greener energy consumption in order to help corporate customers achieve ESG management and SDGs. We also contribute to their cost reduction. In addition, for individual customers, we provide “U-POWER GREEN Home,” an electricity service that is substantially derived from renewable energy. Primary initiatives we rolled out during the fiscal year under review included the launch in September 2025 by USEN ICT Solutions CORPORATION of “USEN GA TE02 Premier Internet (R)” that utilizes network service provided by Rakuten Mobile, Inc. and the launch in January 2026 by USEN NETWORKS Co., Ltd. of “USEN home AIR,” a wireless home router for individual customers that requires no installation work, in collaboration with WirelessGate, Inc. In addition, starting in January 2026, U-POWER Co., Ltd. expanded i ts “GREEN Home Family Plan,” an electricity plan sourced from renewable energy, to strengthen its sales efforts toward family households in addition to single-person households, which had been its primary customer segment. In May of the same year, U-POWER Co., Ltd. also started a collaboration with UPDATER, Inc., aiming to break away from reliance on imported fossil fuels and expand the use of renewable energy that brings both corporate growth and decarbonization. In the energy business, performance declined significantly in the second half of the fiscal year under review due to a sharp rise in power procurement costs primarily driven by the situation in the Middle East that arose in February 2026. A recovery plan is under way to improve the revenue structure, including a review of transaction terms with customers and sales agencies. As a result, net sales and operating profit of the Communication & Energy Business for the fiscal year under review were ¥199, 459 million (up 23. 7% year on year) and ¥9,5 33 million (down 27. 7% year on year), respectively.
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5 <Financial, Realty & Global Business> The Financial, Realty & Global Business is a growth domain in which we aim to create a fourth pillar of our business while also generating synergies with our three existing businesses. This business is operated by the following: U-NEXT LIVING PARTNERS Co., Ltd., USEN TRUST Co., Ltd., USEN REALTY Co., Ltd., USEN PAY Co., Ltd., USEN Fintech Co., Ltd., USEN Properties Co., Ltd. and USEN Insurance Group Co., Ltd. The Financial Business primarily serves commercial stores and provides cashless payment services based mainly on face-to-face payment methods using dedicated terminal devices, rent guarantee services, and non-life insurance, among others. In the rent guarantee domain, we are working to expand our service lineup on a rolling basis. Our efforts include the provision of “TENALEAD,” a service that matches tenant properties between realty brokers and store owners in order to establish a point of contact with store owners at an earlier stage of business, and the launch of “Residence Rent Guarantee” for individual residents. In the Realty Business, we provide sales agency services of communication lines and Wi -Fi services for condominium and apartment house developers, and procure and sell I oT related products such as smart locks. We also offer commercial building management, realty brokerage, and subleasing services. In the Global Business, Amane Asia Sdn. Bhd., a halal food manufacturing subsidiary established in Malaysia in anticipation of future growth in the Muslim population, opened its first directly operated restaurant, “Pizza AMANE Tokyo,” in March 2026. We aim to expand business in the Islamic world by providing Japanese-quality “food” made exclusively with halal ingredients. Primary initiatives we rolled out during the fiscal year under review included the succession of the acquiring business in the cashless payment domain from SBI Sumishin Net Bank, Ltd. (currently DOCOMO SMTB Net Bank, Inc.) through an absorption-type company split in February 2026. As this has established a framework that enables us to provide end -to-end services to partner stores together with a cashless payment agency service business which had become our subsidiary through an earlier M&A, we will aim to further increase productivity and added value. In the rent guarantee domain, in April of the same year, SHIN NIHON CREDIT GUARANTEE CO., LTD., which mainly engages in individual rent guarantee services, became a wholly owned subsidiary. By combining the acquired business with the know -how and business foundation that the Group has cultivated through the provision of rent guarantees to store tenants, we aim to provide high -quality services to more customers. As a result, net sales and operating profit of the Financial, Realty & Global Business for the fiscal year under review were ¥24,277 million (up 118.4% year on year) and ¥2,156 million (up 45.3% year on year), respectively. (2) Overview of Financial Position for the Fiscal Year under Review (Assets) Total assets at the end of the fiscal year under review increased by ¥94,552 million compared with the end of the previous fiscal year to ¥354,335 million. Current assets increased by ¥60,628 million compared with the end of the previous fiscal year to ¥232,986 million mainly due to increases in cash and deposits of ¥5,954 million, in notes and accounts receivable - trade, and contract assets of ¥4 2,661 million, in inventories of ¥2,6 80 million, and in content distribution rights of ¥5,642 million. Non-current assets increased by ¥33,9 24 million compared with the end of the previous fiscal year to ¥121,349 million mainly due to increases in property, plant and equipment of ¥9,165 million, in intangible assets of ¥14,603 million, and in investments and other assets of ¥10,156 million. (Liabilities) Current liabilities increased by ¥4 6,365 million compared with the end of the previous fiscal year to ¥126,171 million.
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6 Non-current liabilities increased by ¥31, 842 million compared with the end of the previous fiscal year to ¥103,110 million mainly due to increases in bonds payable of ¥20,000 million, in long-term borrowings of ¥7,872 million, and in retirement benefit liability of ¥2,787 million. (Net assets) Net assets increased by ¥16,345 million compared with the end of the previous fiscal year to ¥125, 053 million mainly due to increases in retained earnings of ¥11,432 million and in non-controlling interests of ¥4,571 million. (3) Overview of Cash Flows for the Fiscal Year under Review Cash and cash equivalents (hereinafter referred to as “net cash”) on a consolidated basis at the end of the fiscal year under review was ¥62,836 million, an increase of ¥5,954 million compared with the end of the previous fiscal year, including an increase in cash and cash equivalents resulting from inclusion of a subsidiary in consolidation of ¥817 million. Primary factors for this were as follows. (Cash flows from operating activities) Net cash provided by operating activities for the fiscal year under review was ¥23,7 43 million (¥20,671 million provided for the previous fiscal year). Primary factors for this were the recording of profit before income taxes of ¥27,088 million, depreciation of ¥12,063 million, amortization of goodwill of ¥3,752 million, income taxes paid of ¥11,096 million, increases in trade receivables of ¥39,867 million, in inventories of ¥89 million, and in trade payables of ¥ 39,711 million, decreases in electronically recorded obligations - operating of ¥514 million and in accounts payable - other of ¥1,9 43 million, and an increase in content distribution rights of ¥5,642 million. (Cash flows from investing activities) Net cash used in investing activities for the fiscal year under review was ¥44,240 million (¥20,178 million used for the previous fiscal year). Primary factors for this were decreases in net cash of ¥12,555 million due to purchase of property, plant and equipment, ¥8,518 million due to purchase of intangible assets, and ¥17,354 million due to purchase of shares of subsidiaries resulting in change in scope of consolidation. (Cash flows from financing activities) Net cash provided by financing activities for the fiscal year under review was ¥25,633 million (¥3,501 million provided for the previous fiscal year). Primary factors for this were an increase in net cash of ¥12,422 million due to proceeds from long-term borrowings, a decrease in net cash of ¥3,465 million due to repayments of long-term borrowings, an increase in net cash of ¥20,000 million due to issuance of bonds, and a decrease in net cash of ¥3,066 million due to dividends paid. (4) Future Outlook The Group aims to make the most of its management asset s, namely its stable customer base for video content, music content, a variety of IoT products, network infrastructure, and other services, and will maintain its strong direct selling systems. At the same time, by making full use of various sales channels such as telemarketing, web marketing, and agency networks, the Group will further strengthen its service creation capabilities, growth potential, and profit generation capabilities. With regard to the consumption behavior and corporate activities that change due to various factors, as well as rapidly changing technological and social environments, the Group believes that it is important to quickly capture the needs and business opportunities in the market by making full use of technologies such as IoT and AI and work to maximize shareholder value and corporate value through sustainable profit growth under swift decision-making. Under a holding company structure, the Group will make a united effort to promote DX inside and outside the Group, share customer assets, and maximize Group synergies.
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7 Based on the above, the financial results forecast for the next fiscal year is as follows. (Consolidated) (Million yen) Net sales Operating profit Ordinary profit Profit attributable to owners of parent Fiscal year ending August 31, 2027 (Forecast) 524,000 32,500 30,700 16,500 Fiscal year ended August 31, 2026 (Result) 469,957 30,255 28,169 14,959 2. Basic Policy on Selection of Accounting Standards The Group has adopted corporate accounting standards generally accepted in Japan (Japanese standards). Regarding the adoption of the International Financial Reporting Standards (IFRS), we are currently collecting and examining relevant information and have not yet determined the future adoption.
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8 3. Consolidated Financial Statements and Principal Notes (1) Consolidated Balance Sheets (Million yen) As of August 31, 2025 As of August 31, 2026 Assets Current assets Cash and deposits 56,882 62,836 Notes and accounts receivable - trade, and contract assets 48,927 91,589 Inventories 12,196 14,876 Content distribution rights 42,196 47,839 Other 12,603 16,611 Allowance for doubtful accounts (448) (767) Total current assets 172,358 232,986 Non-current assets Property, plant and equipment Buildings and structures 36,371 36,733 Accumulated depreciation and impairment (24,637) (25,573) Buildings and structures, net 11,734 11,160 Land 4,889 7,777 Other 7,763 14,615 Total property, plant and equipment 24,387 33,552 Intangible assets Goodwill 40,022 46,482 Other 13,159 21,303 Total intangible assets 53,182 67,786 Investments and other assets Investment securities 1,508 6,087 Long-term loans receivable 4,656 968 Retirement benefit asset - 527 Deferred tax assets 5,459 7,745 Other 3,909 6,221 Allowance for doubtful accounts (5,680) (1,539) Total investments and other assets 9,854 20,010 Total non-current assets 87,424 121,349 Total assets 259,782 354,335
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9 (Million yen) As of August 31, 2025 As of August 31, 2026 Liabilities Current liabilities Notes and accounts payable - trade 36,559 77,491 Electronically recorded obligations - operating 1,539 1,025 Current portion of long-term borrowings 3,153 4,236 Income taxes payable 6,692 7,380 Contract liabilities 11,144 12,579 Provision for loss on guarantees 730 989 Other provisions 124 629 Other 19,862 21,838 Total current liabilities 79,805 126,171 Non-current liabilities Bonds payable 10,000 30,000 Long-term borrowings 55,663 63,535 Retirement benefit liability 2,236 5,023 Other 3,368 4,551 Total non-current liabilities 71,268 103,110 Total liabilities 151,074 229,281 Net assets Shareholders’ equity Share capital 99 99 Capital surplus 29,786 29,786 Retained earnings 67,534 78,967 Treasury shares (0) (0) Total shareholders’ equity 97,420 108,853 Accumulated other comprehensive income Valuation difference on available-for-sale securities 87 133 Remeasurements of defined benefit plans 63 358 Total accumulated other comprehensive income 150 491 Non-controlling interests 11,137 15,708 Total net assets 108,708 125,053 Total liabilities and net assets 259,782 354,335
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10 (2) Consolidated Statements of Income and Comprehensive Income Consolidated Statements of Income (Million yen) For the fiscal year ended August 31, 2025 For the fiscal year ended August 31, 2026 Net sales 390,408 469,957 Cost of sales 261,583 329,986 Gross profit 128,825 139,970 Selling, general and administrative expenses 97,253 109,715 Operating profit 31,571 30,255 Non-operating income Interest income 85 213 Dividend income 9 99 Share of profit of entities accounted for using equity method 55 85 Reversal of allowance for doubtful accounts 458 53 Other 163 100 Total non-operating income 772 552 Non-operating expenses Interest expenses 786 1,348 Commission expenses 113 351 Foreign exchange losses 373 649 Other 172 288 Total non-operating expenses 1,444 2,638 Ordinary profit 30,900 28,169 Extraordinary income Gain on sale of non-current assets 145 7 Gain on sale of investment securities 78 – Other – 0 Total extraordinary income 223 8 Extraordinary losses Impairment losses 228 18 Loss on retirement of non-current assets 792 1,056 Other 0 15 Total extraordinary losses 1,021 1,090 Profit before income taxes 30,101 27,088 Income taxes - current 10,602 11,682 Income taxes - deferred 132 (915) Total income taxes 10,734 10,767 Profit 19,366 16,320 Profit attributable to non-controlling interests 971 1,361 Profit attributable to owners of parent 18,395 14,959
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11 Consolidated Statements of Comprehensive Income (Million yen) For the fiscal year ended August 31, 2025 For the fiscal year ended August 31, 2026 Profit 19,366 16,320 Other comprehensive income Valuation difference on available-for-sale securities 46 47 Remeasurements of defined benefit plans, net of tax (33) 295 Total other comprehensive income 12 342 Comprehensive income 19,379 16,663 Comprehensive income attributable to Comprehensive income attributable to owners of parent 18,408 15,300 Comprehensive income attributable to non -controlling interests 971 1,363
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12 (3) Consolidated Statements of Changes in Net Assets For the fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) (Million yen) Shareholders’ equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders’ equity Balance at beginning of period 99 29,786 51,843 (0) 81,729 Changes during period Dividends of surplus (2,284) (2,284) Profit attributable to owners of parent 18,395 18,395 Purchase of treasury shares (0) (0) Increase (decrease) in change of scope of consolidation (419) (419) Net changes in items other than shareholders’ equity Total changes during period – – 15,691 (0) 15,690 Balance at end of period 99 29,786 67,534 (0) 97,420 Accumulated other comprehensive income Non-controlling interests Total net assets Valuation difference on available-for-sale securities Remeasurements of defined benefit plans Total accumulated other comprehensive income Balance at beginning of period 40 97 138 10,166 92,033 Changes during period Dividends of surplus (2,284) Profit attributable to owners of parent 18,395 Purchase of treasury shares (0) Increase (decrease) in change of scope of consolidation (419) Net changes in items other than shareholders’ equity 46 (33) 12 971 983 Total changes during period 46 (33) 12 971 16,674 Balance at end of period 87 63 150 11,137 108,708
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13 For the fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) (Million yen) Shareholders’ equity Share capital Capital surplus Retained earnings Treasury shares Total shareholders’ equity Balance at beginning of period 99 29,786 67,534 (0) 97,420 Changes during period Dividends of surplus (3,066) (3,066) Profit attributable to owners of parent 14,959 14,959 Increase (decrease) in change of scope of consolidation (459) (459) Net changes in items other than shareholders’ equity Total changes during period – – 11,432 – 11,432 Balance at end of period 99 29,786 78,967 (0) 108,853 Accumulated other comprehensive income Non-controlling interests Total net assets Valuation difference on available-for-sale securities Remeasurements of defined benefit plans Total accumulated other comprehensive income Balance at beginning of period 87 63 150 11,137 108,708 Changes during period Dividends of surplus (3,066) Profit attributable to owners of parent 14,959 Increase (decrease) in change of scope of consolidation (459) Net changes in items other than shareholders’ equity 45 295 340 4,571 4,912 Total changes during period 45 295 340 4,571 16,345 Balance at end of period 133 358 491 15,708 125,053
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14 (4) Consolidated Statements of Cash Flows (Million yen) For the fiscal year ended August 31, 2025 For the fiscal year ended August 31, 2026 Cash flows from operating activities Profit before income taxes 30,101 27,088 Depreciation 8,599 12,063 Amortization of goodwill 3,328 3,752 Increase (decrease) in allowance for doubtful accounts (376) 346 Increase (decrease) in provision for loss on guarantees 271 259 Increase (decrease) in retirement benefit liability (10) (448) Interest and dividend income (95) (312) Interest expenses 786 1,348 Impairment losses 228 18 Loss on retirement of non-current assets 885 1,056 Loss (gain) on sale of non-current assets (145) (7) Decrease (increase) in trade receivables (7,242) (39,867) Decrease (increase) in inventories (866) (89) Increase (decrease) in trade payables 5,398 39,711 Increase (decrease) in electronically recorded obligations - operating (1,115) (514) Increase (decrease) in accounts payable - other (1,967) (1,943) Decrease (increase) in content distribution rights (6,757) (5,642) Other, net 558 (941) Subtotal 31,582 35,875 Interest and dividends received 95 312 Interest paid (786) (1,348) Income taxes paid (10,219) (11,096) Net cash provided by (used in) operating activities 20,671 23,743 Cash flows from investing activities Purchase of property, plant and equipment (9,458) (12,555) Proceeds from sale of property, plant and equipment 262 60 Payments for retirement of property, plant and equipment (658) (405) Purchase of intangible assets (6,822) (8,518) Proceeds from sale of investment securities 196 0 Purchase of shares of subsidiaries resulting in change in scope of consolidation (3,215) (17,354) Purchase of shares of subsidiaries and associates (400) (2,933) Payments for acquisition of businesses – (1,000) Other, net (82) (1,534) Net cash provided by (used in) investing activities (20,178) (44,240) Cash flows from financing activities Proceeds from long-term borrowings 9,050 12,422 Repayments of long-term borrowings (3,121) (3,465) Proceeds from issuance of bonds – 20,000 Dividends paid (2,284) (3,066) Other, net (141) (256) Net cash provided by (used in) financing activities 3,501 25,633 Net increase (decrease) in cash and cash equivalents 3,995 5,136 Cash and cash equivalents at beginning of period 52,738 56,882 Increase in cash and cash equivalents resulting from inclusion of subsidiaries in consolidation 148 817 Cash and cash equivalents at end of period 56,882 62,836
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15 (5) Notes to Consolidated Financial Statements (Notes on going concern assumption) Not applicable. (Change in the scope of consolidation or the scope of adoption of the equity method) During the third quarter of the fiscal year ended August 31, 2026, the Company acquired shares of XING INC. and made it a consolidated subsidiary. Accordingly, XING INC. was included in the scope of consolidation. (Segment information, etc.) [Segment information] 1. Overview of reportable segments (1) Method for determining reportable segments The reportable segments of the Group are the components of the Group for which discrete financial information is available and they are regularly reviewed by the Board of Directors to make decisions on management resource allocation and to assess performance. The Group has adopted a holding company system. The Company, the Group’s holding company, formulates management strategies of the Group and manages the business performance of its subsidiaries responsible for each business. Furthermore, for each of the business companies that are the subsidiaries of the Company, the Company formulates comprehensive strategies about the products and services that each company handles and operates business activities. Taking into account business scale and significance in the Group strategies, the Group has positioned the Content Distribution Business, the Store & Facility Solution Business, the Communication & Energy Business, and the Financial, Realty & Global Business as its core businesses, and designated them as reportable segments. (2) Type of products and services belonging to each reportable segment The Content Distribution Business is operated by U-NEXT Co., Ltd. and Y .U-mobile Co., Ltd., our consolidated subsidiaries, and provides and sells “U-NEXT,” a distribution platform service of videos and e-books, among others, and “U-NEXT MOBILE” and “y.u mobile,” our own MVNO services. The Store & Facility Solution Business is operated by the following consolidated subsidiaries: USEN CORPORA TION, USEN-ALMEX INC., USEN Camera Solutions Co., Ltd., USEN FIELDING Co., Ltd., USEN Techno-Service Co., Ltd., WannaEat CO., LTD., USEN Contact Center Co., Ltd., U’S MUSIC Co., Ltd., USEN MEDIA PROMOTION Co., Ltd., and XING INC., and contributes to both enhancing operational efficiency and increasing sales by providing comprehensive and practical solutions to management issues faced by a wide variety of stores and facilities including restaurants and retail stores. The Communication & Energy Business is operated by the following consolidated subsidiaries: USEN NETWORKS Co., Ltd., USEN ICT Solutions CORPORA TION, USEN Smart Works CORPORA TION, TACT INC., U-MX Co., Ltd., USEN WORKING Co., Ltd., USEN WORK WELL Co., Ltd., and U-NEXT Co., Ltd. in charge of the communication business, and U-POWER Co., Ltd. in charge of the energy business. The Financial, Realty & Global Business is operated by the following consolidated subsidiaries: U -NEXT LIVING PARTNERS Co., Ltd., USEN TRUST Co., Ltd., USEN REALTY Co., Ltd., USEN PAY Co., Ltd., USEN Fintech Co., Ltd., USEN Properties Co., Ltd. and USEN Insurance Group Co., Ltd. 2. Method for calculating the amounts of net sales, profit (loss), assets, liabilities and other items by reportable segment The accounting methods of reportable segments are the same as those adopted for the preparation of the consolidated financial statements. Profit of reportable segments is stated on an operating profit basis.
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16 3. Information on net sales, profit (loss), assets, liabilities and other items by reportable segment Fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) (Million yen) Reportable segment Adjustment (Note 1) Amount recorded in consolidated financial statements (Note 2) Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Net sales Goods transferred at a point in time 11,755 38,146 17,942 4,401 72,246 – 72,246 Goods transferred over a certain period of time 116,235 57,140 135,672 3,111 312,159 55 312,214 Revenue from contracts with customers 127,990 95,287 153,615 7,512 384,406 55 384,461 Other revenue (Note 3) – – 3,210 2,736 5,946 – 5,946 Net sales to outside customers 127,990 95,287 156,825 10,249 390,353 55 390,408 Inter-segment sales or transfers 404 1,778 4,469 866 7,518 (7,518) – Total 128,394 97,066 161,295 11,115 397,871 (7,463) 390,408 Segment profit 9,648 16,361 13,186 1,484 40,681 (9,109) 31,571 Segment assets 81,157 66,284 51,391 18,787 217,620 42,162 259,782 Other items Depreciation 1,253 6,414 230 228 8,126 473 8,599 (Notes) 1. Details of the adjustment are as follows: (1) The adjustment for segment profit of ¥(9,109) million is the elimination of inter-segment transactions and corporate expenses not allocated to each reportable segment. Corporate expenses are mainly selling, general and administrative expenses that are not attributable to reportable segments. The adjustment for segment assets of ¥ 42,162 million represents corporate assets not allocated to segments and elimination of inter-segment transactions. (2) The adjustment for depreciation of ¥ 473 million represents the depreciation of corporate assets not allocated to each reportable segment. 2. Segment profit is reconciled to operating profit reported in the consolidated statements of income. 3. Other revenue is revenue based on the Accounting Standard for Financial Instruments (ASBJ Statement No. 10; July 4, 2019) and the Accounting Standard for Lease Transactions (ASBJ Statement No. 13; March 30, 2007). The Company applies discounts to electricity and gas charges at discount prices per unit determined by the government under the “Program for Mitigating Drastic Price Fluctuations of Electricity and Gas,” which is administered pursuant to the “Comprehensive Economic Measures for Overcoming Price Increases and Revitalizing the Economy” and the “Comprehensive Economic Measures for Completely Overcoming Deflation.” Other revenue includes subsidies received from the government to fund the discounts.
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17 Fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) (Million yen) Reportable segment Adjustment (Note 1) Amount recorded in consolidated financial statements (Note 2) Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Net sales Goods transferred at a point in time 14,753 37,283 21,770 5,891 79,699 6 79,705 Goods transferred over a certain period of time 129,285 66,946 168,261 10,356 374,849 73 374,922 Revenue from contracts with customers 144,038 104,229 190,032 16,248 454,549 79 454,628 Other revenue (Note 3) – 3,468 4,304 7,556 15,329 – 15,329 Net sales to outside customers 144,038 107,698 194,337 23,804 469,878 79 469,957 Inter-segment sales or transfers 421 2,916 5,122 473 8,933 (8,933) – Total 144,460 110,614 199,459 24,277 478,812 (8,854) 469,957 Segment profit 11,276 16,849 9,533 2,156 39,816 (9,560) 30,255 Segment assets 84,604 90,332 66,632 67,090 308,659 45,675 354,335 Other items Depreciation 1,973 8,956 241 451 11,622 440 12,063 (Notes) 1. Details of the adjustment are as follows: (1) The adjustment for segment profit of ¥(9,560) million is the elimination of inter-segment transactions and corporate expenses not allocated to each reportable segment. Corporate expenses are mainly selling, general and administrative expenses that are not attributable to reportable segments. The adjustment for segment assets of ¥ 45,675 million represents corporate assets not allocated to segments and elimination of inter-segment transactions. (2) The adjustment for depreciation of ¥ 440 million represents the depreciation of corporate assets not allocated to each reportable segment. 2. Segment profit is reconciled to operating profit reported in the consolidated statements of income. 3. Other revenue is revenue based on the Accounting Standard for Financial Instruments (ASBJ Statement No. 10; July 4, 2019) and the Accounting Standard for Lease Transactions (ASBJ Statement No. 13; March 30, 2007). The Company applies discounts to electricity and gas charges at discount prices per unit determined by the government under the “ Support Program for Reducing the Burden of Electricity and Gas Charges” and other programs, which are administered pursuant to the “Comprehensive Economic Measures to Build a ‘Strong Japanese Economy.’” Other revenue includes subsidies received from the government to fund the discounts and revenues from insurance contracts and similar arrangements that meet the definition under the Insurance Act.
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18 [Related information] Fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) 1. Information by product and service This information is omitted as the classification is the same as that of reportable segments. 2. Geographical information (1) Net sales This information is omitted as net sales to outside customers in Japan exceed 90% of the net sales reported in the consolidated statements of income. (2) Property, plant and equipment This information is omitted as the amount of property, plant and equipment located in Japan exceeds 90% of the amount of property, plant and equipment reported in the consolidated balance sheets. 3. Information by principal customer This information is omitted as we have no single outside customer that accounts for 10% or more of the net sales reported in the consolidated statements of income. Fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) 1. Information by product and service This information is omitted as the classification is the same as that of reportable segments. 2. Geographical information (1) Net sales This information is omitted as net sales to outside customers in Japan exceed 90% of the net sales reported in the consolidated statements of income. (2) Property, plant and equipment This information is omitted as the amount of property, plant and equipment located in Japan exceeds 90% of the amount of property, plant and equipment reported in the consolidated balance sheets. 3. Information by principal customer This information is omitted as we have no single outside customer that accounts for 10% or more of the net sales reported in the consolidated statements of income.
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19 [Information on impairment loss on non-current assets by reportable segment] Fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) (Million yen) Reportable segment Corporate and elimination Total Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Impairment losses – 146 82 – 228 – 228 Fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) (Million yen) Reportable segment Corporate and elimination Total Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Impairment losses – 18 – – 18 – 18 [Information about amortization of goodwill and unamortized balance by reportable segment] Fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) (Million yen) Reportable segment Corporate and elimination Total Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Amortization during the year – 639 15 165 820 2,508 3,328 Balance at the end of the year – 7,496 124 3,554 11,176 28,846 40,022 Fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) (Million yen) Reportable segment Corporate and elimination Total Content Distribution Business Store & Facility Solution Business Communica- tion & Energy Business Financial, Realty & Global Business Total Amortization during the year – 931 64 248 1,243 2,508 3,752 Balance at the end of the year – 16,759 77 3,306 20,144 26,337 46,482 [Information on gain on negative goodwill by reportable segment] Fiscal year ended August 31, 2025 (From September 1, 2024 to August 31, 2025) Not applicable. Fiscal year ended August 31, 2026 (From September 1, 2025 to August 31, 2026) Not applicable.
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20 (Per share information) For the fiscal year ended August 31, 2025 For the fiscal year ended August 31, 2026 Net assets per share 540.94 yen 606.21 yen Basic earnings per share 101.99 yen 82.93 yen (Notes) 1. Information on diluted earnings per share is not provided as there were no shares with dilutive effect. 2. The Company conducted a 3-for-1 stock split of common shares effective as of December 1, 2024. Accordingly, the figures for basic earnings per share are calculated assuming that the stock split was conducted at the beginning of the fiscal year ended August 31, 2025. 3. Basis for calculation of basic earnings per share and diluted earnings per share is as follows. For the fiscal year ended August 31, 2025 For the fiscal year ended August 31, 2026 Basic earnings per share Profit attributable to owners of parent (Million yen) 18,395 14,959 Amount not attributable to common shareholders (Million yen) – – Profit attributable to owners of parent related to common stock (Million yen) 18,395 14,959 Average number of shares during the period (Shares) 180,374,987 180,374,910 (Significant subsequent events) Not applicable.