To Our Shareholders

Thank you very much for your ongoing support. In advance of the 21th Ordinary General Meeting of Shareholders, I would like to convey to you the following notice.

During the fiscal year ending March 2025, demand for furniture and interior goods remained robust, as did domestic and cross-border e-commerce. However, we encountered significant challenges due to factors such as the substantial fluctuations in exchange rates resulting from U.S. monetary policy and related trends, along with concerns regarding rising raw material and energy costs, inflation, and declining consumer confidence. These elements contributed to a rapidly evolving business environment for both our furniture and interior e-commerce business, LOWYA, and the cross-border e-commerce platform business, DOKODEMO.

With respect to our core business, LOWYA, we have strategically expanded our physical store presence to enhance customer engagement, while capitalizing on our strengths in customer attraction, product design, and price competitiveness, with the objective of establishing a streamlined OMO-type D2C business model. Regarding new store openings for the current fiscal year, we have opened five stores at the following locations: Yokohama (Kanagawa Prefecture) in August 2024; Setagaya Ward (Tokyo) in September 2024; Aki District (Hiroshima Prefecture) in October 2024; and Ibaraki City (Osaka Prefecture) and Shizuoka City (Shizuoka Prefecture) in November 2024. Including the offline stores opened in the previous fiscal year, the total number of stores as of the end of the current fiscal year has increased to eight. We are gradually observing positive effects on the LOWYA flagship store from the existing stores, and we will continue to conduct verification to establish an OMO-type D2C business model. Moving forward, we will prioritize the diversification of our channels to enhance customer connectivity, boost brand recognition, and adapt to the evolving demands of our customers.

In terms of profit and loss, despite the yen’s depreciation trend, we maintained stable cost control through foreign exchange hedging and other measures. Due to our ongoing efforts to optimize marketing costs since the previous fiscal year, as well as our reductions in personnel and fixed costs, we have achieved a significant increase in profit compared to the previous fiscal year.

With respect to our DOKODEMO business, despite a continued downward trend in gross merchandise volume due to changes in inbound consumption trends and efforts to optimize marketing costs, we have seen steady growth in the number of registered users and app downloads through the implementation of measures such as supporting store operators in enhancing their product lineup and marketing initiatives. Going forward, we will continue in our efforts to expand gross merchandise volume.

I respectfully ask for the continued understanding and support of our shareholders.

OMO:Online Merges with Offline

Tomokazu Ukishiro
President and CEO
June 2025