Message from the President

Review of our Long-Term Strategy ONE DUSKIN

The fundamental concept of the Long-Term Strategy ONE DUSKIN was to enhance the value each of our businesses creates while pursuing the "All for One" concept, where all businesses and services unite to meet customer needs, thereby providing new value to customers in an integrated manner.

Looking back over the past decade, the Direct Selling Group has embraced its new tagline, "Creating Healthy Environments" and discovered new possibilities under the ONE DUSKIN strategy. A prime example is the service for setting up and operating COVID-19 vaccination sites. Duskin Rent-All, which provides comprehensive event support, collaborated with Clean Service, which rents and sells hygiene supplies, and ServiceMaster, which handles facility hygiene management, to propose hygiene management plans for vaccination sites and provide products and services.Through similar cross-business collaborations, we have been able to serve many customers. These collaborations include our Event Hygiene Services, which provide hygiene management for various events and concert venues, and contracts with local governments for our Disaster Risk Reduction Support Service, which includes support for hygiene management for evacuation shelters during disasters.

In the Clean Service businesses, following the easing of the COVID-19 pandemic, we have introduced dedicated sales teams focused on acquiring new residential customers, in addition to our existing customer service representatives. We have also enhanced our digital touchpoints, expanding customer engagement through both physical and digital channels. Furthermore, we have successfully adapted to changes in the social environment and our customers' needs. For example, last year we launched a new cleaning mop set for pets, which was very well-received by our customers.

In the Food Group, Mister Donut, the mainstay of the group, discontinued its 100-yen sale in 2016 and instead launched initiatives to add new value to its donuts. It began co-developing products with brands possessing the highest-quality ingredients and techniques, such as the Kyoto green tea specialty brand Gion Tsujiri, and these products have been sold under the MISDO Meets line since 2017. In addition, we have refined Mister Donut's regular items that have enjoyed long-standing popularity. Furthermore, to ensure customers enjoy our delicious donuts, we are enhancing brand value by, for example, accelerating renovations to create a more comfortable atmosphere in our shops and by introducing an online ordering system to improve customer convenience. These efforts help our customers experience greater deliciousness and excitement and help drive the growth of our business.

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Overseas, Mister Donut has expanded its operations to Singapore and Hong Kong, following its entry into Thailand, the Philippines, Taiwan and Indonesia. In Malaysia and Cambodia, we operate the halal-certified donut brand "Big Apple" through our wholly owned subsidiary. Mister Donut will continue to expand into untapped markets, mainly in Southeast Asia. In Islamic countries, we plan to develop our business primarily under the Big Apple brand. Regarding the household cleaning service offered by the Direct Selling Group, we will leverage our existing presence in Taiwan as a springboard to expand into countries where we have not yet established operations. In this way, we will expand our overseas businesses in both the Direct Selling Group and the Food Group.

Building upon the cross-business collaboration and service quality improvements we have established under the ONE DUSKIN strategy, we will further refine these assets in the new phase to deliver even greater satisfaction to our customers.

Two pillars supporting future growth: Leveraging digital technology and securing and developing human resources

One area where we need to focus more effort is further utilizing digital technology. By now, the Direct Selling Group has completed the installation of RFID electronic tags on all 24 million rental mats and mops in circulation. This has reduced labor burden throughout the supply chain, including counting used mats and mops collected from customers at each franchisee location, and inspecting and counting during receiving and shipping at cleaning plants. The Food Group has opened a Mister Donut shop featuring a pilot unmanned checkout system in Shinanomachi, Tokyo. Additionally, the group has begun testing AI-powered image recognition registers at existing locations to enhance checkout efficiency.

Furthermore, we will consolidate our internal information systems departments, pursue cloud migration, and accelerate our digital transformation (DX) to achieve further productivity gains. With the efficiencies gained via DX, we will dedicate the newly freed time to further deepen our commitment to our customers and pursue the fulfillment of our Purpose and Vision.

Another challenge is securing and developing human resources. In Japan, where the population is aging and birth rates are declining, demand for our Care Service — such as professional cleaning, home cleaning and helper services, garden maintenance, and wall, floor and other minor home repairs — is increasing, particularly among senior customers and dual-income households. However, during peak seasons when demand surges, we sometimes struggle to secure sufficient staffing to provide such services, inevitably causing some inconvenience to our customers.

Our services are primarily delivered by people. Even as the working population declines, we are dedicated to ensuring stable service delivery. To this end, we focus not only on optimizing equipment and systems but also on securing outstanding personnel and providing training to enhance their service skills.The environment surrounding us and the way we live will undergo significant changes at an unprecedented pace. Our company must also sensitively perceive these environmental shifts and flexibly adapt how we engage with our customers and the communities surrounding us. What matters is not merely keeping pace with environmental changes but adding values people will need in such times of change. Since our founding, we have grown by continuously embracing diverse challenges. This commitment remains unchanged. We will carry this spirit forward, unafraid of change, and continue to evolve with our sights set on the next step ahead.

A future pioneered through our Prayerful Management philosophy, and three "EXcellence" goals to pursue

Since our founding in 1963, we have conducted our business under the corporate philosophy of Prayerful Management. Prayerful Management means maintaining a spirit of gratitude toward our customers and all those who work together with us. Our founder, Seiichi Suzuki, believed that profit is the reward of joyous transactions. Driven by his wish for everyone involved in Duskin's work to find happiness, he adopted the slogan "Sowing the seeds of joy" as our guiding principle in pursuing our business.
In November 2024, looking ahead to our future, we clarified our Purpose (Why we exist) and Vision (Where we are headed) and formulated a new long-term business policy, which we have been implementing since April 2025. We have defined our Purpose as "Building a happy and fulfilling future while staying attuned to people and society," and defined our Vision for fulfilling this purpose as "Spreading smiles that connect people to people, to society, and to the future." Based on these definitions, we have established a new Long-Term Business Policy Do-Connect, to achieve these goals. These concepts were developed through extensive discussions led by a project team composed of mid-level employees who will shape our company's future. The development process incorporated diverse perspectives, including input from outside directors, reflecting the outcomes of discussions among a wide range of members.

At the heart of our Vision, "Spreading smiles that connect people to people, to society, and to the future," are our franchisees and the people working in those workplaces. Our company values human connections, and this Vision embodies our commitment to connect with local communities through our locally rooted franchisees, cherishing each day — today, tomorrow, the day after tomorrow and a year from now — as we live our lives. Our "sowing the seeds of joy" initiative does not end once flowers bloom. We will keep sowing seeds, nurturing diverse blossoms of joy and bright smiles. Our goal is to channel these efforts into creating communities where customers feel, "We're glad we have Duskin in our town."

Furthermore, based on our corporate vision, we are developing visions for the Direct Selling Group and Food Group, as well as visions for each individual business unit, while simultaneously establishing logic trees. From there, we will translate these into specific business strategies, individual employee action goals and KPIs. Our goal is to ensure that the actions and achievements of each employee contribute to fulfilling the vision of each group, the company-wide vision and our Long-Term Business Policy Do-Connect. To achieve this goal, all employees are working together as one.

At the same time, to realize the company's vision, we have asked all employees to challenge themselves toward one of three "EXcellence" goals. These three goals are: "Explore," which challenges us to create new social value for the future; "Expand," which challenges us to create new customer value through business model transformation; and "Excel," which challenges us to build strong relationships with customers to increase customer value.

As part of our efforts to embody "Explore," in 2023 we entered into a capital and business alliance agreement with JP-Holdings, Inc., which operates childcare support facilities. Following this alliance, we established a new business development project composed of members raising children who volunteered to take on new ventures leveraging the strengths of both companies' expertise and know-how. Through this project, we are challenging ourselves to create social value by developing new ventures that help solve societal issues, such as exploring the potential for new services for families raising children and for childcare facilities.

Our efforts to embody "Expand" include entering the house maintenance domain to support comfortable living environments, and franchising Katsu & Katsu pork cutlet restaurants and the Italian restaurant Napoli No Shokutaku, in untapped regions. Additionally, we are developing new food service brands tailored to different locations, customer demographics and user motivations, and also pursuing M&A, all to create greater customer value.

Regarding our third goal, "Excel (in our existing businesses)," I would like to mention the current market environment surrounding our rental cleaning products. These rental products, centered around the Stylish Floor Mop, LaLa mop for home use, are utilized by approximately four million households nationwide. However, due to the recent increase in dual-income households, there has been a rise in cases where our customer-visit staff cannot meet customers face-to-face during daytime hours. Therefore, we place great importance on strengthening our connection with customers through digital communication while also directly listening to their concerns, opinions and requests. By incorporating customer feedback in this way, we develop new products and improve existing ones. Through these measures to strengthen customer relationships, we are challenging ourselves to enhance customer value — and this is one of the initiatives that embodies "Excel."

We will let our hearts drive us forward and evolve

Our founder left us the words, "Road construction that temporarily blocks passage is done to make the road passable." This means that while construction temporarily closes a road, it is done to repair its flaws, improve it and ultimately bring joy to all who travel upon it. From these words, I learned to reframe my mindset: no matter what difficult challenges I face, they provide me with the discipline to keep moving forward. This has now become my most cherished motto.

And our new value statement, "Let your heart drive you forward!", which we defined alongside our Purpose and Vision statements, embodies the passion of the members of this definition project, who thoroughly discussed the theme. It appealingly expresses what we hold dear. To ensure Duskin remains true to itself, we will continue to take on challenges. Together with our franchisees, we will let our hearts drive us forward and evolve.

To our stakeholders

In light of changes in today's social environment, we at Duskin aim to become a bridge connecting "people to people," "people to society," and "people to the future," contributing to the creation of a happy and fulfilling future filled with peace of mind and joy. To achieve this, under our Long-Term Business Policy Do-Connect, we will convey what our customers feel and connect it to others. We will place even greater importance on dialogue and communication with our customers, deepening our relationships of trust. Our goal is to see communities where people genuinely say, "We're glad we have Duskin in our town."

We kindly ask our stakeholders for your continued understanding and support.

September 2025

Hiroyuki Okubo

Representative Director
President and CEO