LEIFRAS Co., Ltd. Reports Financial Results of Six Months Ended June 30, 2025

LEIFRAS Co., Ltd. (Nasdaq: LFS) (the “Company” or “Leifras”), a sports and social business company dedicated to youth sports and community engagement, today announced its unaudited financial results for the six months ended June 30, 2025.

Financial Highlights of the Six Months Ended June 30, 2025

— Revenue was JPY5.5 billion ($38.1 million) for the six months ended June 30, 2025, an increase of 15.0% from JPY4.8 billion for the same period last year.

— Gross profit was JPY1.4 billion ($10.0 million) for the six months ended June 30, 2025, an increase of 16.1% from JPY1.2 billion for the same period last year.

— Gross margin was 26.3% for the six months ended June 30, 2025, increased from 26.0% for the same period last year.

— Net income was JPY53.7 million ($0.4 million) for the six months ended June 30, 2025, an increase of 25.6% from JPY42.8 million for the same period last year.

— Basic and diluted earnings per share was JPY2.2 ($0.01) for the six months ended June 30, 2025, compared to basic earnings per share of JPY1.7 and diluted earnings per share of JPY1.5 for the same period last year.

Operational Highlights of the Six Months Ended June 30, 2025

— Number of membersin the sports school businesswas69,500 for the six months ended June 30, 2025, an increase of6.4%from65,337for the same period last year.

— Average membershipduration in the sports school businesswas1.9 years for the six months ended June 30, 2025, an increase of 2.2% from 1.8 yearsfor the same period last year.

— Revenue per capita in the sport school business, which we define as the sales revenue of the sports school business divided by the number of employees involved in that business, was JPY6.1 million ($42,433) for the six months ended June 30, 2025, an increase of 4.2% from JPY5.9 million for the same period last year.

— Number of schoolsserved under the social business segmentwas349 for the six months ended June 30, 2025, an increase of48.5%from235for the same period last year.

— Revenue per capita in the social business, which we define as the sales revenue of the social business divided by the number of employees involved in that business, was JPY5.1 million ($35,121) for the six months ended June 30, 2025, an increase of 21.7% from JPY4.2 million for the same period last year.

Mr. Kiyotaka Ito, the Representative Director and Chief Executive Officer of Leifras, commented, “We are pleased to share strong results for the first half of fiscal year 2025, with revenue increasing 15.0%, gross profit rising 16.1%, and net income growing 25.6% year over year. These results reflect both growth in our sports school business, where membership and event participation continued to increase, and momentum in our social business, which saw a 48.5% increase in the number of schools servedfrom the same period last year. Notably, revenue per capita in our social business rose 21.7% year over year, highlighting the growing value and impact of our community-based services.

“In October 2025, we achieved an important milestone with Leifras' successful initial public offering on Nasdaq. This achievement would not have been possible without the unwavering support of so many: the children and families who use our services, the shareholders who share our vision, the business partners who advance our mission, and the dedicated instructors across Japan whose passion drives our work each day. I offer my heartfelt gratitude to everyone who has been part of this journey.”

Mr. Ito continued, “At Leifras, we believe in the power of sports to transcend language and borders and to enrich lives and communities. Looking ahead, we are dedicated to continuing to build on the momentum by advancing youth sports education, broadening our social initiatives, and driving operational efficiency to create sustainable, long-term value for our shareholders and the communities we serve.”

Financial Results of the Six Months Ended June 30, 2025

Revenue

Total revenue was JPY5.5 billion ($38.1 million) for the six months ended June 30, 2025, an increase of 15.0% from JPY4.8 billion for the same period last year.

Sports school business revenue was JPY3.9 billion ($27.3 million) for the six months ended June 30, 2025, an increase of 8.5% from JPY3.6 billion for the same period last year. The increase in revenue was mostly driven by: (i) an increase in the number of members by 4,163, from 65,337 as of June 30, 2024 to 69,500 as of June 30, 2025, resulting in an increase in revenue of JPY229.1 million ($1.6 million) and (ii) an increase in the number of customers who joined events hosted by the Company from 84,651 for the six months ended June 30, 2024 to 90,501 for the six months ended June 30, 2025, leading to an increase in the sports school business revenue by JPY74.8 million ($0.5 million).

Social business revenue was JPY1.6 billion ($10.8 million) for the six months ended June 30, 2025, an increase of 35.4% from JPY1.1 billion for the same period last year. The increase in revenue was mostly driven by: (i) an increase in the number of schools by 114, from 235 as of June 30, 2024 to 349 as of June 30, 2025, resulting in an increase in revenue of JPY356.2 million ($2.5 million), and (ii) an increase in after-school daycare service revenue by JPY37.4 million ($0.3 million).

Cost of Revenue

Cost of revenue was JPY4.0 billion ($28.1 million) for the six months ended June 30, 2025, an increase of 14.6% from JPY3.5 billion for the same period last year.

Gross Profit

Gross profit was JPY1.4 billion ($10.0 million) for the six months ended June 30, 2025, an increase of 16.1% from JPY1.2 billion for the same period last year.

Gross margin was 26.3% for the six months ended June 30, 2025, increased from 26.0% for the same period last year.

Selling, General, and Administrative Expenses

Selling, general, and administrative expenses were JPY1.4 billion ($9.5 million) for the six months ended June 30, 2025, an increase of 13.6% from JPY1.2 billion for the same period last year. The increase was attributed to (i) the increase in salaries and welfare expenses of JPY69.8 million ($0.5 million) due to business expansion as well as an increase in headquarters personnel in preparation for our initial public offering (“IPO”), (ii) the increase in promotion fees of JPY10.7 million ($0.07 million) due to business expansion, (iii) the increase in office rental fees of JPY12.6 million ($0.09 million) due to business expansion, (iv) the increase in system maintenance fee expenses of JPY13.9 million ($0.10 million) incurred due to the increase in the number of employees, and (v) the increase in recruitment fees of JPY33.4 million ($0.2 million) due to business expansion as well as an increase in headquarters personnel in preparation for our IPO.

Other Income (Expenses)

Other expenses were JPY11.3 million ($0.08 million) for the six months ended June 30, 2025, a decrease of 139.5% from other income of JPY28.6 million for the same period last year. The decrease was attributed to: (i) net franchise income collected (returned) of JPY27.4 million ($0.2 million), which was the payments refunded to the franchisees in connection with the transfer of certain business rights, (ii) an eviction compensation of JPY5.5 million ($0.04 million) received in connection with the vacating of a leased building.

Net Income

Net income was JPY53.7 million ($0.4 million) for the six months ended June 30, 2025, an increase of 25.6% from JPY42.8 million for the same period last year.

Basic and Diluted Earnings per Share

Basic earnings per share was JPY2.2 ($0.01) for the six months ended June 30, 2025, compared to JPY1.7 for the same period last year.

Diluted earnings per share was JPY2.2 ($0.01) for the six months ended June 30, 2025, compared to JPY1.5 for the same period last year.

Financial Condition

As of June 30, 2025, the Company had cash of JPY2.5 billion ($17.3 million), compared to JPY2.5 billion as of December 31, 2024.

Net cash provided by operating activities wasJPY312.8 million ($2.2 million) for the six months ended June 30, 2025, compared to net cash used in operating activities of JPY212.3 million for the same period last year.

Net cash used in investing activities wasJPY47.2 million ($0.3 million) for the six months ended June 30, 2025, compared to JPY44.2 million for the same period last year.

Net cash used in financing activities was JPY306.1 million ($2.1 million) for the six months ended June 30, 2025, compared to JPY35.7 million for the same period last year.

Recent Development

The Company consummated its IPO on October 10, 2025, in which it issued and sold 1,250,000 American Depositary Shares (“ADSs”) at a price of $4.00 per ADS, resulting in gross proceeds of approximately JPY720.9 million ($5.0 million) and net proceeds of approximately JPY673.5 million ($4.7 million) after deducting the underwriting discount of approximately JPY47.4 million ($0.3 million).

Financial Guidance

The Company expects total revenue to be between $80.2 million and $82.6 million for the fiscal year ending December 31, 2025, an increase of approximately 11.9% to 15.3% from $71.6 million for the fiscal year ended December 31, 2024.

Income from operations is projected to be between $4.0 million and $4.8 million for the fiscal year ending December 31, 2025, an increase of 11.6% to 34.0% from $3.6 million for the fiscal year ended December 31, 2024.

These projections are based on the assumption that no business acquisitions, restructuring activities, or legal settlements will take place during the period.

Exchange Rate Information

This announcement contains translations of certain Japanese Yen (“JPY”) amounts into U.S. dollars (“USD,” or “$”) for the convenience of the reader. Translations of amounts from JPY into USD have been made at the exchange rate of JPY144.17 = $1.00, the exchange rate on June 30, 2025 set forth in the H.10 statistical release of the United States Federal Reserve Board on July 7, 2025.

About LEIFRAS Co., Ltd.

Headquartered in Tokyo, Leifras is a sports and social business company dedicated to youth sports and community engagement. The Company primarily provides services related to the organization and operations of sports schools and sports events for children. As of December 31, 2024, Leifras was recognized as one of Japan's largest operators of children's sports schools in terms of both membership and facilities by Tokyo Shoko Research. The Company's approach to sports education emphasizes the development of non-cognitive skills, following the teaching principle “acknowledge, praise, encourage, and motivate.” The holistic approach that integrates physical and mental development sets Leifras apart in the industry. Building upon deep experience and know-how in sports education, Leifras also operates a robust social business sector, dispatching sports coaches to meet various community needs with the aim to promote physical health, social inclusion, and community well-being across different demographics. For more information, please visit the Company's website: https://ir.leifras.co.jp/.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company's current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy,and financial needs. Investors can find many (but not all) of these statements by the use of words such as “approximates,” “believes,” “hopes,” “expects,” “anticipates,” “estimates,” “projects,” “intends,” “plans,” “will,” “would,” “should,” “could,” “may,” or other similar expressions in this press release. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. These statements are subject to uncertainties and risks, including, but not limited to, the uncertainties related to market conditions, and other factors discussed in the “Risk Factors” section of the registration statement filed with the the U.S. Securities and Exchange Commission (the “SEC”). Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the registration statement and other filings with the SEC.Additional factors are discussed in the Company''s filings with the SEC, which are available for review atwww.sec.gov.

For more information, please contact:

LEIFRAS Co., Ltd. Investor Relations Department Email: IR@leifras.co.jp

Ascent Investor Relations LLC Tina Xiao Phone: +1-646-932-7242 Email: investors@ascent-ir.com

LEIFRASCO., LTD. AND SUBSIDIARIESUNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEETS December31, June30, June30, 2024 2025 2025 JPY JPY US$ (Unaudited) (Unaudited)ASSETSCURRENT ASSETSCash 2,538,554,638 2,498,098,518 17,327,450Accounts receivable, net 518,398,551 487,639,054 3,382,389Short-term investments 4,935,000 4,711,000 32,677Inventories, net 24,468,188 23,298,191 161,602Prepaid expenses 182,278,232 116,165,484 805,754Other current assets 34,381,843 42,803,587 296,897TOTAL CURRENT ASSETS 3,303,016,452 3,172,715,834 22,006,769NON-CURRENT ASSETSProperty and equipment, net 53,805,279 101,588,668 704,645Finance lease right-of-use assets 208,611,550 239,787,178 1,663,225Operating lease right-of-use assets 337,330,750 529,227,650 3,670,858Intangible assets, net 39,250,078 31,471,323 218,293Goodwill 27,999,994 27,999,994 194,215Deferred tax assets, net 214,671,578 222,612,673 1,544,098Deferred initial public offering (“IPO”) costs 157,482,065 243,714,152 1,690,464Long-term deposits 150,407,276 150,527,126 1,044,095Other non-current assets 3,090,205 10,818,502 75,040TOTAL NON-CURRENT ASSETS 1,192,648,775 1,557,747,266 10,804,933TOTAL ASSETS 4,495,665,227 4,730,463,100 32,811,702LIABILITIES AND SHAREHOLDERS' EQUITYCURRENT LIABILITIESShort-term loans 700,000,000 700,000,000 4,855,379Current portion of long-term loans 230,785,000 169,248,000 1,173,947Bond payable, current 40,000,000 40,000,000 277,450Accounts payable 168,281,568 147,601,943 1,023,805Accrued liabilities 1,109,740,581 1,157,505,640 8,028,757Income tax payable 75,374,800 2,592,200 17,980Contract liabilities, current 147,628,310 362,794,883 2,516,438Amount due to a director 1,000,000 – -Finance lease liabilities, current 71,681,545 83,509,650 579,244Operating lease liabilities, current 110,889,134 127,649,484 885,409Other current liabilities 195,952,191 142,558,262 988,821TOTAL CURRENT LIABILITIES 2,851,333,129 2,933,460,062 20,347,230NON-CURRENT LIABILITIESLong-term loans, net of current portion 175,452,000 80,884,000 561,032Bond payable, non-current 56,807,020 37,491,230 260,049Contract liabilities, non-current 10,615,635 13,393,896 92,903Finance lease liabilities, non-current 140,333,247 154,402,355 1,070,974Operating lease liabilities, non-current 207,353,977 385,702,563 2,675,332Assets retirement obligations 12,914,758 30,567,335 212,023TOTAL NON-CURRENT LIABILITIES 603,476,637 702,441,379 4,872,313TOTAL LIABILITIES 3,454,809,766 3,635,901,441 25,219,543COMMITMENTS AND CONTINGENCIESSHAREHOLDERS' EQUITYOrdinary shares 80,500,000 80,500,000 558,369Additional paid-in capital 748,840,080 748,840,080 5,194,146Treasury shares (100,012,265) (100,012,265) (693,711)Retained earnings 311,527,646 365,233,844 2,533,355TOTAL SHAREHOLDERS' EQUITY 1,040,855,461 1,094,561,659 7,592,159TOTAL LIABILITIES AND SHAREHOLDERS' 4,495,665,227 4,730,463,100 32,811,702EQUITYLEIFRASCO., LTD. AND SUBSIDIARIESUNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF INCOME For the six months ended June30 2024 2025 2025 JPY JPY US$NET REVENUE 4,773,202,759 5,488,810,821 38,071,796Cost of revenue (3,532,146,670) (4,047,686,339) (28,075,788)GROSS PROFIT 1,241,056,089 1,441,124,482 9,996,008Selling, general, and administrative expenses (1,208,412,234) (1,373,195,238) (9,524,833)INCOME FROM OPERATIONS 32,643,855 67,929,244 471,175OTHER INCOME (EXPENSE)Interest income 26,102 1,299,080 9,011Interest expense (9,169,968) (9,378,973) (65,055)Grant income 12,913,919 9,399,558 65,198Unrealized (loss) gain on short-term investment 245,000 (224,000) (1,554)Loss on disposal of long-lived assets – (168,973) (1,172)Loss on disposal of a subsidiary (753,900) – -Other income (expense), net 16,198,568 (20,302,598) (140,824)Total other income, net 19,459,721 (19,375,906) (134,396)INCOME BEFORE INCOME TAX PROVISION 52,103,576 48,553,338 336,779PROVISION FOR INCOME TAXESCurrent (3,922,389) (2,788,235) (19,340)Deferred (5,405,355) 7,941,095 55,081Total provision for income taxes (9,327,744) 5,152,860 35,741NET INCOME 42,775,832 53,706,198 372,520WEIGHTED AVERAGE NUMBER OF ORDINARY SHARESBasic 24,910,660 24,910,619 24,910,619Diluted 28,115,922 24,913,619 24,913,619EARNINGS PER SHAREBasic 1.72 2.16 0.01Diluted 1.52 2.16 0.01LEIFRASCO., LTD. AND SUBSIDIARIESUNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS For the six months ended June30, 2024 2025 2025 JPY JPY US$Cash flows from operating activitiesNet income 42,775,832 53,706,198 372,520Adjustments to reconcile net income to net cash provided by operatingactivitiesDepreciation and amortization expense 60,244,494 66,679,088 462,503Loss on disposal of a subsidiary 753,900 – -Reversal of (provision for) expected credit loss (1,089,375) 5,788,690 40,152Loss on disposal of property and equipment – 168,973 1,172Provision for inventory impairment – 719,481 4,991Unrealized loss (gain) on short-term investment (245,000) 224,000 1,554Other non-cash expenses 1,846,026 215,875 1,497Deferred tax expense 5,405,355 (7,941,095) (55,081)Changes in operating assets and liabilitiesAccounts receivable, net 36,039,016 24,970,807 173,204Inventories 1,140,810 450,516 3,125Prepaid expenses (30,483,735) 65,923,967 457,265Long-term deposits (8,058,565) (119,850) (831)Amount due from a director 33,577,065 – -Other current assets (848,651) (8,421,744) (58,416)Other non-current assets (11,654,487) (7,728,297) (53,606)Accounts payable (93,111,459) (20,679,625) (143,439)Accrued liabilities (271,113,027) 47,765,059 331,311Contract liabilities 214,872,458 217,944,834 1,511,721Operating lease liabilities (21,505) 3,212,036 22,280Income tax payable (153,014,746) (72,782,600) (504,839)Amount due to a director – (1,000,000) (6,936)Other current liabilities (39,335,511) (56,292,856) (390,462)Net cash (used in) provided by operating activities (212,321,105) 312,803,457 2,169,685Cash flows from investing activitiesCash outflow due to reduction in consolidated entities (17,257,489) – -Purchase of property and equipment (11,322,540) (42,125,175) (292,191)Purchase of intangible assets (15,621,500) (5,045,000) (34,994)Net cash used in investing activities (44,201,529) (47,170,175) (327,185)Cash flows from financing activitiesPayment of finance lease liabilities (27,097,591) (43,752,315) (303,477)Proceeds from bank loans 250,000,000 – -Repayment of bank loans (177,355,000) (156,105,000) (1,082,784)Repayment of bond payable (20,000,000) (20,000,000) (138,725)Payment of deferred IPO costs (61,211,064) (86,232,087) (598,128)Net cash used in financing activities (35,663,655) (306,089,402) (2,123,114)Net decrease in cash (292,186,289) (40,456,120) (280,614)Cash at the beginning of period 2,729,282,346 2,538,554,638 17,608,064Cash at the end of the period end 2,437,096,057 2,498,098,518 17,327,450Supplementary cash flow informationCash paid for income taxes 156,721,835 75,570,835 524,179Cash paid for interest expenses 7,323,942 8,637,073 59,909

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