Agenda

1.Company Profile

2.Initiatives Implemented in FY2015

3.Mid-term Business Plan

4.CSR/Dividend Policy

2

１. Company Profile

3

About Nitori Group

4

Stores：1 Sales：¥10 M Employees：2 My age：23 First store opened (99.17㎡) in December 1967

• Established：December 1967

• Incorporated： March 1972

• Net Sales：¥445 bil.

• Capital：¥13.3 bil.

• Main Operations：Furniture/home furnishing manufacture, logistics, retail

• No. of Stores：420 （As of February 2016）

• No. of Employees：Approximately 28,000

Nitori Group

5

4 Companies in Southeast Asia

（India, Malaysia, Thailand,Vietnam）

Nitori Public

Home Deco

Nitori USA

Nitori Taiwan

Home Logistics

Nitori Facility

Nitori Furniture

(Vietnam, Indonesia）

5 Companies in China

Nitori

Planning & Sales

Logistics Store

furnishing maintenance

Furniture Manufacturing

Marketing company in China,

Trading Firm/ Warehouse

Trading Firm

Advertising & Travel Agency

Curtain Manufacturing

& Import

Marketing company in Taiwan

Marketing company in U.S.

Nitori Holdings Co., Ltd.

【14 overseas companies】 【7 domestic companies】

2 other companies

Company Objective and Our Long-term Vision

6

Offering a rich variety of choices for world citizens pursuing more comfortable living space

2022 1,000 stores ¥1 tril. in sales Expanding high-market-share regions, contributing to more comfortable living space

2032 3,000 stores ¥3 tril. in sales Offering a rich variety of choices for world citizens pursuing more

comfortable living space

2012 300 stores ¥340 bil. in sales

Company Objective

Long-term Vision

Manufacture-Logistics-Retail Business Model

7

Some 90% of Nitori’s merchandise developed in-house or directly imported (private labels)

Marketing & research Procurement of materials Factory production

Quality testing & packaging Store operations Logistics Import

Product Planning & Designing

Global Sourcing

8 Nitori’s merchandise produced using materials sourced globally

Procure high-quality materials at low-cost globally

UV paint

Low formalin materials

Sockets

Drawer pulls

Drawers

Counter

Bottom drawers

Drawer front plates

Enamel paint

Inclined shelves

Earthquake

proof latches

Total Coordination of Furniture and Furnishings

Total coordination proposals

9

Domestic Store Network

10

Hokkaido Region 19 stores

Tohoku Region 28 stores

Kinki Region 66 stores

Kanto Region 109 stores

Tokai Region 47 stores

Hokuriku & Koshinetsu Region 30 stores

Chugoku & Shikoku Region 40 stores

Kyushu & Okinawa Region 44 stores （As of Feb 20 2016）

３８３stores ３４４ ３９

Overseas Store Network

11

China ８stores USA

5 stores

Taiwan ２4 stores

（As of Feb 20 2016）

Factories and Logistics Centers

12 Nitori Furniture Indonesia(1994)

Taicang Distribution Center, China (2015)

Shanghai Process Center, China(2008)

3 Factories direct

management

Domestic large logistics distribution centers

Overseas large logistics distribution centers

Nitori Furniture Vietnam (2004)

Nitori Furniture Ba Ria-Vung Tau(2015)

Plan to start operating in FY2017 （400K ㎡）

Kanto distribution center Kansai distribution center Kyushu distribution center

E-Commerce /Corporate Business Sales

13

Nitori Net

Corporate Business Sales/ Renovations

Office Convenience stores Total remodeling

２. Initiatives Implemented in FY2015

14

Full-year Company Targets Call for Higher Revenue, Profit for 29 Years

15

0

10

20

30

40

50

60

70

80

90

100

0

50

100

150

200

250

300

350

400

450

500

'87 '88 '89 '90 '91 '92 '93 '94 '95 '96 '97 '98 '99 '00 '01 '02 '03 '04 '05 '06 '07 '08 '09 '10 '11 '12 '13 '14 '15

Sales

Ordinary income

（Ordinary Income：¥ bil.） （Sales:¥ bil.）

Sales ¥445 bil.(plan)

Ordinary Income ¥72 bil.(plan)

16

Nitori Studio

Product Development

Developed and manufactured in our factories

Affordable prices Maintained

A wide variety of colors, sizes offered to customers

⇒ helps boost customer visits and diversify customer base

135 patterns for your style

17

Portable and environmentally-friendly

Single Mattress Porta 2

Product Development

KaruFuwa Down Comforter

Extremely lightweight and fluffy

18

Nーsleep “Premium” Series Individual coils support the body, dispersing body pressure

Our pocket coil technology

A mattress that gives the ultimate sleep

Product Development

19

ふところは寒いが、

Product Development

N Cool N Warm

Quality has markedly improved

Building a stable supply system

Customer base expansion unfolding on exposure to high-profile department store, media

Developing a wider range of merchandise, including for kids

20

Ranked 26th in Nikkei’s

Top 30 Items of the Year

“Nitori Skillet” Selling Points

Nitori Skillet

An affordable price of ¥498（including taxes）

Easy to use and stays warm for

a long time

Can be used in an oven and has

a wide range of uses

500K sold

Development

３. Mid-term Business Plan

21

Increasing Furniture / Home Furnishing Market Size

22

Europe

North America

South America

Oceania

Japan

China

Russia/CIS

Korea

Middle East

Africa

Mexico

2020-22 Hfa + Furniture

Estimated market size ( ¥1tril.)

¥45 tril.⇒¥57 tril.⇒¥83 tril.

2

10

1

10

1

1 0.7

2013 Hfa + Furniture

Estimated market size ( ¥1tril.)

2

0.7

3 4

2

0.2

３

１４

2

2

１４

2

4 ９

1

1

1

3

0.3

Taiwan

※ internal investigation

India

ASEAN

0.7

Expanding Overseas Markets

１６

２

４

１６

４

2

４

１６

１

４

1 ３

４

2

0.4

2030-32 Hfa + Furniture

Estimated market size ( ¥1tril.)

2013 2022 2032

Nitori Mall Miyazaki April 2015 ＯＰＥＮ

Shopping Mall

23

Nitori Mall Hirakata ２０１６ Spring

ＯＰＥＮ (planned)

Largest Nitori Mall （floor space:58,500㎡）

Property adjacent to Nitori Miyazaki Store redeveloped

(floor space:52,700㎡）

Logistics

24

106,000㎡

Kobe Logistics Distribution Center

32,000㎡

Large new logistics centers to come on stream

Start Operations in FY 2018, largest scale ever in

Nitori Group

Start Operations in FY2017

57,000㎡

New centers designed to meet higher volume from accelerated store expansion

Satte Logistics Distribution Center

Start Operations in FY2018

Nagoya Logistics Distribution Center

・ Workplace no longer solely driven by

career-track employees

・ Increasingly diversified work styles at stores

・ Women, senior citizens playing more important roles

・Supporting nursing care

・Maternity/ Parental leave and shortened hours fully introduced

＜ Diversity Committee ＞ ＜ Return-to-work program ＞ 25

30

47

64

87

0

10

20

30

40

50

60

70

80

90

100

2012 2013 2014 2015

(headcount)

(FY)

No.of parental leave

Different Working Styles Possible

Work Environment

Employees rotate in intervals

averaging 2-3 years

With store operations forming the hub of career development, employees rotate through different departments to sharpen skills as specialists

Job Rotation

Purpose of rotation

Skills as specialists will be

sharpened

26

Store operations

Adver-tisement

EC

Sales Planning

Edu-cation

Manu-facturing

IT

Logistics

Trading company

A) Revamping merchandising

B) Revamping supply systems

C) Strengthening quality control

D) Raising quality of services

E) Revamping of business strategy

Major Initiatives for FY2016

27

28

A. Revamping merchandising

■ Establishing a system to develop merchandise for world citizens

・Development of merchandise marketable worldwide

・Locating new procurement sources

・global sharing of product information

■ Vertical Merchandising

・ Sourcing policy

・ Global operations to have the same suppliers/vendors

■Revamping merchandise mix and redesigning retail space

・Developing standard merchandise mix for each region

・Reviewing price points to diversify customer base

Major Initiatives for

FY2016

29

■ Global Quality Standards ・Establishing global standards for quality control

・Assisting business partners in achieving the said standards

・Shifting quality controls abroad; quality control- oriented human resource development

■ Optimization of Global Inventory Management

・Building a global logistics network

・Building centers for complex cargo loading;

sharing of merchandise information

■ Measures Taken to Address Cost Increases, Labor Shortage (We view them as an opportunity and

differentiate us from others)

・Mechanize, automate, systemize

Ｂ. Revamping supply systems Ｃ. Strengthening quality control

Major Initiatives for

FY2016

30

■ Laying the groundwork for faster store openings abroad

■ Strengthening In-store Customer Services

・Strengthening customer-facing services and offering more attractive self-service options

(differentiation pursued based on strength of brick and mortar stores)

■ Transforming into Omni-channel Retailer

・Building a framework to allow customers to shop more conveniently

Ｄ. Raising quality of services Ｅ. Revamping of business strategy

Major Initiatives for

FY2016

４. CSR/Dividend Policy

31

32

Moves for Environmental Protection

Reduction of CO2 Emissions

Sales and CO2 Emissions per Store

(FY)

(t-co2) (¥ bil.)

More efficient trucking Shorter distances, closures of freight terminals key to cuts

Energy saving at stores, logistics centers Introduction of LED lighting for overhead illumination

Using reusable packaging to reduce waste

More efficient use of materials in manufacturing Recycling wood chips for reinforcement

Emission cuts on merchandise development Reduced and simplified packaging

0

50

100

150

200

250

300

350

400

450

500

0

20

40

60

80

100

120

140

160

180

200

CO2 Emissions

Sales

Human Development Through Sport

Host the Nitori Ladies Golf tournament

33

Nitori Women’s Running Team

Culture and Education

Nitori International Scholarship Foundation

34

11th year since establishment

Donations to 38 regions and scholarships awarded to 895 individuals

Scholarships awarded to high school students affected in the Touhoku Earthquake

American seminars held for scholarship recipients

Nitori Cultural Foundation

Donation to Hokkaido

Restoration and storage of historical and cultural artifacts

Above items put on view to the public

Tairyu Sanso Garden

In 1998 named as national beauty spot and from Nov. 2010 held by Nitori.

Profit Report to Share Holders

35

‘06.2 ‘07.2 ’08.2 ‘09.2 ‘10.2 ‘11.2 ‘12.2 ‘13.2 ‘14.2 ‘15.2 ‘16.2

（initial plan）

Annual dividend/share (half-year dividend)

５

[2.5]

６.５

[2.5]

１１

[4.5]

１７

[7]

２５

[12.5]

３２.５

[12.5]

４０

[20]

４５

[22.5]

５０

[22.5]

５５

[26]

６０

[30]

Dividend payout ratio (as % of consolidated net income)

５.２% ５.５% ８.１% １０.６% １２.０% １１.８% １３.１% １３.８% １４.３% １４.6% １５.2%

0

10

20

30

40

50

60

'06.2 '07.2 '08.2 '09.2 '10.2 '11.2 '12.2 '13.2 '14.2 '15.2 '16.2

Dividend for shareholders of record at end-FY

Dividend for shareholders of record at end-1H FY

（yen）

Total Shareholder Payouts Dividend hikes over 12 consecutive years

Share buybacks of ¥1.0 bil. Share Repurchases Implemented

Share buybacks of ¥2.2 bil.

Share buybacks of ¥14.6 bil.

※Stock splits adjusted.

0

2,000

4,000

6,000

8,000

10,000

12,000

8,000

11,500

15,000

18,500

22,000

25,500

29,000

Nikkei Stock Average

Nitori Holdings

Stock Performance

36

（Nitori Holdhings: yen） （Nikkei Stock Average: yen）

Nitori’s price appreciation from pre-Lehman-crisis levels roughly 6 times that for Nikkei Stock Average

Nikkei Stock Average up 54%

Nitori Holdings up 330%

※2008/6/30～2016/2/20

【DISCLAIMER】 The forecasts and projected operating results contained in this report are based on information available at the time of preparation, and thus involve inherent risks and uncertainties. Accordingly, readers are cautioned that actual results may differ materially from those projected as a result of a variety of factors. Figures are rounded off to the digits that are displayed.