We wish to express our heartfelt appreciation to our shareholders for their excellent cooperation.

The Tosei Group conducts a wide range of real estate-related businesses in line with its corporate philosophy "To create new value and inspiration in all aspects of real estate as a global-minded group of seasoned professionals".

The business environment surrounding the Group in the recent years has become increasingly uncertain amid revolutionary changes, including the escalation of climate change issues, the emergence of geopolitical risks, the declining birthrate and the aging of society in Japan, the acceleration of behavioral changes triggered by the COVID-19 pandemic, and rapid advances in digital technology. In order to adapt to such changes in the business environment, ensure the Group's sustainable growth over the future, and enhance corporate value by contributing to the realization of a sustainable society, we formulated "Tosei Group Long-Term Vision 2032" and the medium-term management plan "Further Evolution 2026" (December 2023 - November 2026), which started from the fiscal year ended November 30, 2024. We have now entered the final year of the term.

What we aim to be in the Tosei Group Long-Term Vision 2032 is as follows: "We will contribute to the realization of a sustainable society as a unique real estate portfolio manager with diverse solution capabilities". We will further strengthen and expand the Tosei Group's core competencies to achieve both business growth and contribution to sustainable society.

The first half of FY2026, the final year of our current medium-term management plan, has concluded. In today's financial markets, the Bank of Japan has raised its policy interest rate to 1.0% for the first time in 31 years, while Japan's long-term interest rates have climbed to their highest levels in approximately three decades. The impact of these trends on the real estate market should not be overlooked. On the other hand, in the domestic real estate investment market, which is the Group's mainstay market, active investment activity by both domestic and overseas investors continued. Medium to long-term expectations for rent growth fueled robust investor confidence, boosted by the tight rental demand in the office market due to limited new supply, the reflection of rising costs in rents, and other factors.

Amid this operating environment, for the first six months ended May 31, 2026, the Group's financial results marked an exceptionally strong first half, with consolidated revenue of ¥85.9 billion (up 30.1% year on year) and consolidated profit before tax of ¥20.1 billion (up 19.9% year on year), achieving 69.9% of the full-year forecast based on consolidated revenue and 91.5% based on consolidated profit before tax. In particular, the Revitalization Business, our core business, drove overall performance. Our strategic shift in investment from the Development Business to the Revitalization Business in response to soaring construction costs has been successful. Additionally, in the Fund and Consulting Business, we have been entrusted with the management of AUM totaling ¥2.73 trillion and have steadily accumulated achievements as a partner for domestic and overseas institutional investors in domestic real estate investment, whose investment appetite has further strengthened in recent years.

Financial and capital markets are surrounded by various risks, including concerns about a downturn in the domestic economy due to persistent inflation and geopolitical risks such as the uncertain situation in the Middle East. Leveraging portfolio management that balances the growth and stability of our real estate business, along with a diverse asset portfolio, we will adeptly respond to these market changes and continue to meet the expectations of our stakeholders.

We would appreciate your continued support.