Consolidated Business Results

FY2013 April 1, 2013 December 31, 2013 Consolidated Business Results 2014.1.31

01 FY2013 3Q Highlights Overview for the consolidated business result Total Transaction value:81.1billion yen (+19.2% increase / yoy), Operating profit:8.6billion yen (+58.1% increase/ yoy) No change in the initial corporate plan for the whole financial year. Online shopping mall business Transaction value of the mall business: 70.2 billion yen (+16.9% increase / yoy) The number of shops : 581 shops (492 shops / March, 2013) Annual number of purchasers (January, 2013 ~ December, 2013), 3.00 million ( 2.48 million / FY2013 total) Several efforts focused on our original roots (e.g. search function improvement) led the increase of both UU and CVR. Aggressive attempts for the next step such as the new online mall LABOO development. E commerce consulting business Transaction value of e commerce consulting business:10.9 billion yen(+36.6% increase / yoy) The number of clients' websites entrusted: 25 sites (25 sites / March, 2013) Steady performance of existing websites entrusted. The sales volume derived from clients websites that have been entrusted since the preceding term contributed entirely to the transaction value in this quarter. Profitability Operating profit ratio(to the total transaction value):10.6% (the year earlier period, 8.0%) Negative factors: Free shipping service offering and starting up of new logistics facilities caused the increase in the degree of fixed cost burden. Positive factors: Revision of the promotional strategies and inexecution of ZOZOCOLLE Topics Started the new service WEAR (October,2013) Launched ZOZOMARKET, a new online market opened in ZOZOTOWN (January,2014)

Business Performance

03 Overview of the Third quarter FY2013 Consolidated income statement (includes transaction value) Item FY2013 3Q FY2012 3Q YoY Change(%) Target( ) Progress Rate(%) (million) Transaction value 81,139 68,055 +19.2% 108,400 74.9% Net sales 27,776 25,065 +10.8% 36,800 75.5% Gross profit 23,582 20,155 +17.0% - - (% Transaction Value) 29.1% 29.6% -0.6% - - SG&A 14,942 14,690 1.7% - - (% Transaction Value) 18.4% 21.6% -3.2% - - Operating profit 8,640 5,464 +58.1% 10,320 83.7% (% Transaction Value) 10.6% 8.0% +2.6% 9.5% - Recurring profit 8,672 5,494 +57.8% 10,320 84.0% Net income 5,468 3,365 +62.5% 6,320 86.5%

04 Increase decrease analysis of operating profit (YoY comparison) Drop in gross profit margin ratio 4.4 bn Influenced by free shipping offer Outsourcing expence + 0.6 bn Inexecution of ZOZOCOLLE Other 0.1 bn Increase of Variable expence due to the decline of unit price per shipment Profit increase effect + 3.8 bn Increase of SG&A due to the increase of transaction value 2.8 bn Revision of promotion strategies + 3.0 bn Cost increase caused by new logistics facilities'operation. Transaction Value FY2012 3Q:68.0bn FY2013 3Q:81.1bn Operating Profit 8.6 bn Operating Profit 5.4 bn FY2012 3Q FY2013 3Q

05 Consolidated balance sheet (million) FY2012 FY2013 (as of Dec 31, 2013) FY2012 FY2013 (as of Dec 31, 2013) Current assets 20,655 24,080 Current liabilities 10,426 12,649 cash and deposits 12,037 12,551 Deposit received for consignment sales 5,444 8,590 Merchandize inventory 1,276 831 Noncurrent liabilities 673 985 Noncurrent assets 3,217 6,388 Total liabilities 11,099 13,634 Tangible assets 1,538 3,470 Shareholders' equity 12,385 16,365 Intangible assets 725 1,250 Treasury stock -3,660-3,276 Investments and other assets 953 1,667 Total net assets 12,773 16,835 Total assets 23,873 30,469 Total liabilities and net assets 23,873 30,469

06 Transaction Value Gross transaction value of new shops opened in Q3 FY2013 Online mall business ( purchased stock & consignment sales ) : 2.5 billion, (accounts for 3.7% of the total) 1200 1100 E commerce consulting Purchased stock 108.4 1000 Consignment sales 95.8 900 800 80.2 9.1% 11.8% 9.1% 81.1 700 12.8% 600 56.1 500 400 36.6 3.9% 7.5% 19.0% 78.1% 79.1% 13.5% 7.5% 300 200 100 ( bn) 0 21.5 16.7 32.5% 67.5% 27.3% 79.0% 73.5% 30.5% 68.8% 69.5% FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 3Q

07 Transaction Value (Quarterly) YOY +15.8% 340 320 E commerce consulting Purchased stock 31.5 300 280 260 240 220 200 180 160 Consignment sales 16.6 16.8 9.3% 8.3% 23.1 23.6 9.2% 11.8% 9.5% 10.3% 19.1 11.8% 8.6% 21.6 10.6% 9.8% 27.2 12.6% 8.4% 79.0% 27.8 12.1% 9.5% 78.4% 25.2 24.3 12.1% 13.8% 8.7% 8.2% 78.0% 79.2% 14.3% 6.0% 79.7% 140 120 15.7% 14.9% 79.0% 80.2% 79.6% 79.6% 100 80 76.8% 60 75.0% 40 20 ( bn) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

08 Net Sales 36,800 36,000 Others 35,050 33,000 30,000 27,000 E-commerce consulting Consignment sales Purchased stock 31,806 2,662 1,917 2,389 2,976 27,776 1,156 24,000 23,801 1,397 2,854 21,000 1,065 18,000 15,000 17,159 657 338 10,635 16,943 20,968 17,683 12,000 9,000 8,584 450 10,696 591 3,540 6,147 6,000 3,000 2,685 5,448 6,563 10,014 10,701 10,282 8,716 6,082 ( million) 0 08/03 09/03 10/03 11/03 12/03 13/03 14/03 3Q

09 Net Sales (Quarterly) 12,000 10,000 8,000 6,000 4,000 Others E commerce consulting Consignment sales Purchased stock 9,686 9,985 347 9,057 8,975 531 879 8,536 772 782 891 8,186 417 552 585 771 881 7,023 7,191 6,749 608 415 691 738 409 369 596 5,972 6,101 5,001 5,170 3,312 5,249 4,684 3,459 4,210 YOY +6.4% 10,308 352 8,931 1,153 385 819 6,902 5,531 2,000 2,611 2,503 2,731 2,436 1,646 2,122 2,290 2,657 1,987 2,195 1,899 ( mllion) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

10 3,500,000 Number of Total Buyers Number of total buyers = Active members and guest buyers who made at least one purchase within a year Guest buyers = Unique buyers who made a purchase without registering as a member Active members = Members who have made at least one purchase within a year Guest buyers 3,000,173 3,000,000 2,500,000 2,000,000 1,500,000 1,370,295 9,939 Active members 1,515,500 1,719,418 126,420 250,163 1,961,018 2,058,531 379,203 494,012 2,352,188 2,234,069 613,519 571,937 2,489,914 713,815 2,802,245 2,657,467 808,579 901,080 1,037,802 1,000,000 1,360,356 1,389,080 1,469,255 1,581,815 1,564,519 1,662,132 1,738,669 1,776,099 1,848,888 1,901,165 1,962,371 500,000 (members) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

11 Number of shops of Mall business 600 500 Purchased stock Consignment sales 439 469 39 490 492 39 40 514 40 556 39 581 38 400 320 356 38 389 42 40 300 254 41 517 543 200 42 399 430 451 452 474 279 318 347 100 212 (shops) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

12 Member Distribution (As of December 31, 2013) Gender ratio Geographical distribution Age distribution Overseas 0.5% Kyusyu/Okinawa 9.1% Hokkaido 3.9% Tohoku 6.1% Chugoku/Shikoku 7.8% Kinki/Tokai 27.3% Kanto39.2% (Tokyo16.1%) Hokuriku/Koshinetsu 6.1%

13 Annual Purchase Amount and pieces per Active Member Annual purchase amount Annual purchase pieces 50,000 10.0 45,000 41,467 42,794 43,164 42,885 43,620 42,960 42,608 43,163 43,406 43,700 43,646 9.0 40,000 35,000 30,000 25,000 20,000 5.7 6.0 6.1 6.3 6.4 6.7 6.7 6.9 7.1 7.2 7.3 8.0 7.0 6.0 15,000 5.0 10,000 4.0 5,000 ( ) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q 3.0

14 Average Purchase Amount per Shipment and Average Retail Price Average purchase amount per shipment = Transaction value / Number of shipments 18,000 16,000 Average purchase amount per shipment Average retail price 14,000 12,000 10,000 12,536 12,397 14,158 12,381 12,522 11,842 13,421 10,629 10,201 9,376 YOY 7.7% 12,389 YOY 7.0% 8,000 8,410 6,000 4,000 6,733 6,275 6,479 6,210 5,244 7,624 5,955 5,677 5,011 7,089 2,000 ( ) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q The transaction value and number of shipments for ZOZOTOWN charity T shirts in FY2011 1Q are not included. With this point in consideration, average purchase per shipment when above is included: 11,891; average retail price: 6,379

15 Number of Shipments 2,500,000 2,302,530 2,367,837 YOY +23.1% 2,183,933 2,054,821 2,000,000 1,725,515 1,636,004 1,774,060 1,500,000 1,268,643 1,243,217 1,487,595 1,347,913 1,000,000 500,000 (shipments) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

The Ratio of Shipping Volume to the Total Purchase Volume (by access terminals) 100% 16 PC Mobile Smart Phone 90% 80% 70% 71.5% 75.1% 60% 60.4% 60.0% 58.8% 60.2% 56.5% 52.8% 52.2% 50.5% 50.1% 50% 40% 35.6% 40.9% 43.2% 45.9% 47.1% 30% 28.5% 24.9% 21.2% 22.6% 27.3% 29.0% 20% 10% 18.4% 17.4% 13.9% 10.8% 7.9% 6.3% 4.6% 3.6% 2.8% 0% FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q

Operating Profit and Operating Profit Margin (% Transaction Value) 17 12,000 Operating profit Operating profit margin (% transaction value) 10,320 20.0% 18.0% 10,000 8,000 7,704 8,529 8,640 16.0% 14.0% 10.5% 10.2% 5,851 12.0% 6,000 8.8% 10.4% 9.6% 8.9% 10.6% 10.0% 8.0% 4,000 3,236 6.0% 2,000 1,764 2,201 4.0% 2.0% ( mllion) 0 FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 3Q 0.0%

18 Selling, General and Administrative (SG&A) Expenses (million) Item Amount 2013 3Q 2012 3Q %Transaction value Amount %Transaction value YoY change %Transaction value Payroll(*) 3,948 4.9% 3,155 4.6% 0.3% Shipping 2,609 3.2% 1,918 2.8% 0.4% Increase decrease factors The number of employee in our group: 473 as of Dec 2012 588 as of Dec 2013 Due to the decreased unit price per shipment ( 7.7%, yoy) arising from free shipment service offering, burden ratio of shipping cost has risen. Payment collection 1,898 2.3% 1,524 2.2% 0.1% Promotion related expenses 1,593 2.0% 3,897 5.7% -3.7% Moving in line with the initial burget for the whole financial year (2% to the total transaction value) Advertising 1,037 1.3% 2,081 3.1% -1.8% Promotional activities for WEAR and LABOO. Reward points related expenses 556 0.7% 1,816 2.7% -2.0% Point reward campaign has shrinked. Outsourcing 1,890 2.3% 2,127 3.1% -0.8% ZOZOCOLLE was held in 2012 only. Rent expense 788 1.0% 385 0.6% 0.4% Depreciation 376 0.5% 231 0.3% 0.2% Annual lease expense for the new logistic facilities is 1.25 billion yen (Accrues from Sep 2013) Increase of depreciation burden due to the new logistics facilities' operation. Others 1,838 2.3% 1,450 2.1% 0.2% Total SG&A 14,942 18.4% 14,690 21.6% -3.2% Payroll includes salaries, bonuses, legal welfare expenses, welfare expenses, provision for retirement benefits, provision for bonuses, provision for directors' retirement benefits and subcontracting payroll

Operating Profit and Operating Profit Margin (Quarterly) (% Transaction Value) 3,500 3,000 Operating profit Operating profit margin (% transaction value) 2,574 3,064 2,873 2,568 3,198 20.0% 18.0% 16.0% 19 2,500 2,276 14.0% 2,000 1,500 1,722 10.3% 1,644 9.8% 2,060 1,635 8.9% 9.6% 8.5% 1,254 9.4% 11.0% 11.8% 10.2% 10.1% 12.0% 10.0% 8.0% 1,000 5.8% 6.0% 4.0% 500 2.0% ( mllion) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q 0.0%

Selling, General and Administrative (SG&A) Expenses (Quartely) 7,000 20 20.0% SG & A(Quartely) 6,000 Promotion related expense(% transaction value) 5,945 18.0% 5,000 4,922 4,869 5,268 5,291 4,939 4,813 16.0% 14.0% 4,000 3,255 3,502 4,130 4,183 12.0% 10.0% 3,000 8.0% 2,000 1,000 5.2% 5.9% 6.7% 6.3% 4.6% 7.1% 5.4% 3.4% 1.3% 2.0% 2.5% 6.0% 4.0% 2.0% ( million) 0 FY2011 1Q FY2011 2Q FY2011 3Q FY2011 4Q FY2012 1Q FY2012 2Q FY2012 3Q FY2012 4Q FY2013 1Q FY2013 2Q FY2013 3Q 0.0%

Business Plan For FY2013

22 Consolidated Business Forecast and Dividend Forecast for FY2013 Business Plan for FY2013 YoY change(%) Transaction value ( million) 108,400 13.0 Net sales ( million) 36,800 5.0 Operating profit ( million) 10,320 21.0 Recurring profit ( million) 10,320 20.4 Net income ( million) 6,320 17.9 Earnings per share ( ) 59.1 - Estimated dividends per share ( ) 20.0 -

23 Transaction Value 120 Transaction value 108.4 35.0 100 Operating Profit Margin (% transaction value) 95.8 30.0 80 80.2 25.0 20.0 60 56.1 15.0 40 36.6 10.4 9.6 8.9 9.5 10.0 8.8 20 5.0 ( bn) 0 FY2009 FY2010 FY2011 FY2012 FY2013(Target) 0.0

Breakdown of the Total Transaction Value and Each Policy Start Today Group Total Transaction Value Target : 108,400 million (+13.0% year on year) Conservative plan based on our 15% natural growth rate Planned under assumption of not holding any promotion activities Mall Business Transaction Value Target : 93,200 million (+10.2% year on year) Consignment Sales Business: 84,400 million ( +11.3%, yoy), Purchased Stock Business 8,800million (+1.0% yoy) Expand and deepen the product category, countermeasure against the sales opportunity loss, the expansion of ZOZOUSED E Commerce Consulting Business Transaction Value Target : 15,200 million (+33.8% year on year) Improving satisfaction level of the existing brand partners Close coordination between physical retail stores and online stores Operating Profit Margin The ratio of consolidated operating profit : 9.5 % (to the total transaction value, FY2013 8.9%) New logistics facilities start its operation from November. Amount of capital investment 3 billion yen (planned) Increase in personnel (75 new graduates) In an effort to improve profit ratio by reducing promotional cost ratio 24

Future Strategies

26 Mid to Long term Vision 500.0 Start Today s mid to long term target FY20XX term Mid to long term transaction value target Transaction value Transaction value Operating profit 500 billion 50 billion 110.0 100.0 95.8 108.4 90.0 80.2 80.0 70.0 60.0 56.1 50.0 40.0 36.6 20.0 ( billion) FY2009 FY2010 FY2011 FY2012 FY2013 (Target) FY20XX

27 Market Expansion Strategy While ZOZOTOWN will continue to focus on the fashion e commerce market, we will expand the depth and breadth of the areas of fashion we cover by continuing to offer e commerce support to fashion brands. Entire apparel market START TODAY s market (mid to long term target) START TODAY s current market Mid to long term transaction value target 500billion E commerce consulting E commerce utilization Consignment sales Purchased stock

28 About our new service WEAR Fashion specific mobile app services with the concept WEAR FOR CONNECTION, enables people enjoying communication about fashion and referring to posted styling images. Opened on Thursday 31 th of October, 2013.

Reference Data

30 588 employees (average age 28.5) 2,211 high fashion brands 6,443 shareholders Corporate philosophy Make the world a better place Bring smiles to the world. 6,072 shops across Japan 3.00 million fashion savvy consumers

31 Major Online Mall Japan's Largest Online Retailer of Apparel and Accessories ZOZOTOWN ZOZOTOWN http://zozo.jp/ One of Japan s largest online shopping sites for fashion items 581 stores offering 2,211 brands. At any given time, more than 210,000 items are available with 1,300 plus new items added a day on average. Store finder function for several boutiques in Japan is also available Users can comment on merchandise and share information via social networking sites such as Twitter, Mixi, GREE and Facebook. Systems, design, logistics and other e commerce functions retained in house. ZOZOTOWN.COM Delivers to 82 countries worldwide. Available in 3 different languages. (Japanese / Chinese (Traditional) / English) The new online shopping mall LA BOO targeting the teens to 20s girls fashion market LA BOO http://la boo.jp/ LA BOO is a mall styled online shopping website where more than 100 online stores of apparel brands that are popular among women in teens and twenties such as moussy, snidel, EMODA, CECIL McBEE and TOPSHOP gather. Opened on Wednesday 25th of September, 2013 LA BOOトップページ

32 Store Planning & Development Business (Purchased Stock) We operate 38 original stores such as ZOZOEPROZE and ZOZOPHAGGE on ZOZOTOWN, which offer products we purchase from various brands. Sales = Transaction value generated by each store Store Operation & Administration Business (Consignment Sales) We operate 543 online stores such as United Arrows and BEAMS on ZOZOTOWN, MARC JACOBS on ZOZOVILLA and LA BOO on a consignment basis. This does not involve any inventory risks. Sales = Transaction value of each store x commission rate B to B Business We help develop and operate online shops on behalf of various brands such as United Arrows and Onward. We currently provide back end service for 25 stores. Store Planning & Development Business 9.1% Sales = Transaction value of these online shops x commission rate Store Operation & Administration Business 79.1% *Our total sales volume consist of above sales and that of other businesses including the initial cost for brands consignment shop opening, ZOZOPREMIUM (premium membership fee based services), and ZOZOCARD (partner credit card fee revenues). B to B Business 11.8% (Transaction value for FY2012)

33 This material has been created for the sole purpose of introducing the company s business activities, and not for soliciting investment. The business forecasts and the future outlook herein described are based on information currently available. They are subject to uncertainties and therefore change, thus actual results may differ.