1

February 6, 2020

Consolidated Financial Results forthe 3Q of the FY ending March 2020

(Nine months ended December 31, 2019)

T-Gaia Corporation / TSE

If there is any discrepancy between the English version and the Japanese version, the Japanese version shall prevail.

2Disclaimer

This material contains statements about the future performance of T-Gaia Corporation which are based on management's assumptions and beliefs taking information currently available into consideration.

Therefore, please be advised that T-Gaia’s actual results could differ materially from those described in these forward looking statements as a result of numerous factors, including general economic conditions in T-Gaia's principal markets as well as other factors detailed from time to time.

3

- Outline of the Consolidated Financial Results for the 3Q of the

FY ending March 2020 4-7

- Financial Results of the 3Q of the FY ending March 2020 and

Strategies by the Business Segments

- Mobile Telecommunications Business Segment 8-11

- Enterprise Solution Business Segment 12-16

- Payment Service Business and Other Business Segment* 17-22

- Appendixes 23-36

Table of Contents

*The translation of the name of the business segment has been revised for more clarity as below.

Former translation: Settlement Service Business & Other Business

Revised translation: Payment Service Business & Other Business

4

Outline of the Consolidated

Financial Results

5

354.95

49.79

40.41

9.38

13.79

9.29

94.2％

98.2％

101.4％

86.7％

91.6％

91.5％

（14.0％）

（2.6％）

（＋0.5ｐ）

（▲0.3ｐ）

82.2％

73.8％

74.3％

71.7％

74.6％

74.9%

432.00

67.50

54.40

13.10

18.50

12.40

(15.6％）

（3.0％）

2.7472.980 92.2％

81.6%5.404.40※１

376.80

50.70

39.86

10.83

15.06

10.15

（13.5％）

（2.9％）

4.23 104.1％

*２ From this fiscal year, UQ WIMAX has been included to the unit sales, and the unit sales for the 3Q of FY 19/3 has been revised.（19/3 3Q +5000 units, full year +7000 units）

※２

Summary of the Consolidated Financial Results

Overall results fall in line with initial forecasts of FY 20/3

Achievement Ratio

Forecasts of 20/3 Full-year

y/y Change

3QFY 19/3

3QFY 20/3

Gross Profit

Net Sales

SG&A Expenses

Operating Profit

Ordinary Profit

（to Net Sales）

（to Net Sales）

Non-Operating Income

（Income from hoarded cards, etc.）

Net Profit

Mobile-phone Unit Sales (million units)

*１ No change to full-year plan for the fiscal year ending March 31 2020, including non-operating profit

（unit: billion yen）

6

8.47 7.68

1.611.93

0.73

321.5 293.8

19.4

35.8

21.3

39.7

5.72 5.21

1.111.34

3.312.72

3Q FY19/3 3Q FY20/3

Mobile Telecommunications Business

Enterprise Solution Business

Payment Service Business & Other Business

3Q FY19/3 3Q FY20/3

376.8 354.9

10.83

10.159.29

[9.5%]

[5.2%]

[85.3%]

[11.2%]

[6.0%]

[82.8％]

[14.9%]

[6.8%]

[78.3%]

[11.0%]

[32.6%]

[56.4%]

[14.5%]

[29.4%]

[56.1%]

[▲2.4%]▲0.22

[20.6%]

[81.8%]

9.38 The increase in expenses due to the planned cost of sales promotion for the new service, “QUO Card Pay” by QUO CARD Co., Ltd. the subsidiary company.

Net sales of mobile telecommunication business decreased affected by the lower unit sales of mobile phone handsets.

Financial Results of the 3Q by Business Segment

All have marked low compared to the same time last year however overall results fall in line with the initial forecasts.

Net Sales Net Profit

Operating Profit

(Billion Yen)

(Billion Yen)

（Billion Yen）

* [ ] = segment ratio

3Q FY19/3 3Q FY20/3

7

29802747

●October 2019・Revised Telecommunications Business Act put in force・Separation of communication fee from handset price.

Regulation on reduction of handset sales price.・Increase in consumption tax・Rakuten Mobile postponed its start of MNO service

● Spring of 2020

The deployment of 5G network commercial service

From October 2019 onward

・Strong feeling of handsets are overpriced and restrained buying・Wait and see attitude for Rakuten Mobile MNO service, and the launch

of 5G services.・ There was a last-minute demand before the launch of new plans and

increase in consumption tax, therefore resulted in less sales for this term.

* Including WiFi terminals and MVNO handsets

* The unit sales of FY 19/3 has been modified as UQ WIMAX has been included into the calculation. (7000 units are added.)

Unit Sales of Mobile Phones & TabletsMarket Trends

Consumer Trends

Unit Sales (Thousand Units)

3Q FY 19/3 3Q FY 20/3

Unit Sales of the 3Q on Company-wide Basis

8

Mobile TelecommunicationsBusiness Segment

9

The overall results has fall in line with the y/y forecasts though there has been decrease in sales and profit due to the big drop in

unit sales of mobile handsets after October 2019.

28382576

293.8

8.47 7.68

321.5

5.72 5.21

Financial Results of Mobile Telecommunications Business Segment

Financial Results ComparisonUnit Sales of Mobile Phones

(Thousand Units)* Including WiFi terminals and MVNO handsets

NetSales

OperatingProfit

Net Profit (Billion Yen)

3Q FY 19/3 3Q FY 20/3 3Q FY 19/3 3Q FY 20/3

10

32(9)18(18) 25(23)

Docomo au SB YM UQ Rakuten

1,099（340）

1,127 1,099

189 188

572 550

18 18

1,8551,906

End of Dec 2019End of Dec 2018

1,127（331）

31(8)

44(3)

327(38)

387(95)

285(173)

34(2)

348(38)

414(91)

281(173)

Total Number of Retail Outlets of Mobile Phone and Others

Change in Number of Retail Outlets

Carrier Shop Multi-Carrier Shop

Shop-in-shop & GMS

Accessories Shop

Number of Shops by Each Carrier*( ) = Directly managed Carrier Shop

End of Dec 2019End of Dec 2018

The number of directly managed carrier shops has increased due to the transfer of the management contracts.

11

November 22ndDocomo ShopAcross-Plaza

Minami 22-Jyo

Examples of Investments in Shops

Location Transfer

October 25th

Dual shop opened

Newly Opened

Rakuten Mobile Terrace Mall MatsudoSmart Labo Terrace Mall Matsudo

12

Enterprise SolutionBusiness Segment

13

141

171

19.421.3

1.931.61

1.341.11

3Q FY19/3 3Q FY20/3

Financial Results of Enterprise Solution Business Segment

Financial Results ComparisonUnit Sales of Mobile Phones

(thousand units）* Including WiFi terminals and MVNO handsets

Operating profit and net profit increased due to strong sales in solution services and terminals for enterprise customers.

Net Sales Operating Profit

Net Profit (Billion Yen)

3Q FY19/3 3Q FY20/3

14Subscription Services

544598

Numbers are growing steadily

End of Dec 2018 End of Dec 2019

174

200

Number of Subscription of Help Desk Services

（thousand IDs）

Number of movino star ID

（thousand IDs）The communication line management service for corporate clients

End of Dec 2018 End of Dec 2019

15

Improved support and efficiency

Registration system for TG Hikari service

The system for simplified registration, efficient management of each case, and improved

information sharing.

Support center for sales teamFor improved efficiency for sales department to deal with end customers and resales partners

End of Dec 2019

The optic fiber access service

End of April 2015(Launch)

End of Dec 2018

increasing

steadily

Cumulative Number of TG HikariSubscribers (incl. Resale)

Subscription Service

16In November 2019

Investment in Relay2, Inc.

Cloud wifi X Edge ComputingOffers solutions to customers

The exclusive sale of Relay2 products in the Japanese market willadd edge computing solution to the product range of T-Gaia.

Relay2

Edge

app

Edge ComputingData processing done locally, edge, where it’s close to users.

Advantages・reduces costs・reduced security risks・real-time data processing

Cloud

app

Offers Connection and terminals/handsets, construction of wifi environment

app

インターネット

ネットワーク

17

Payment Service Business andOther Business Segment

18

3Q FY 20/33Q FY 19/3

The promotion of QUO Card Pay launched this FY has been proceeding as planned. Although the increased cost has resulted in drop in profit, the overall results are inline with the initial plan.

Financial Results of Payment Service Business and Other Business Segment

Gross Sales of PIN & Gift Card

Amount of Issued QUO Card

Increase due to the start of gift card business with a major sales channel from 2Q of FY 2019

Issued amount continues to increase

3Q FY 20/33Q FY 19/3

3Q FY 20/33Q FY 19/3

3Q FY 20/33Q FY 19/3

Payment Service Business and Other Business Segment

<T-Gaia Only>

Net ProfitOperating Profit

Net Sales

Financial Results Comparison

Net ProfitOperating Profit

Net Sales

(Billion Yen)

(0.22)

2.72

39.735.8

3.31

0.73

32.5

0.940.64

1.23

0.73

37.2

19In November 2019

Formed Capital Alliance with NETSTARS CO.,LTD.

The service of multi QR code payment gateway StarPayfor retailers mainly in Japan and Asia

“StarPay”Accepting more than 20 brands of

QR code payment services（As of end of Dec 2019）

NETSTARS CO.,LTD.

20In November 2019

Formed Capital and Business Alliance with BlueStack Systems, Inc.

The first esports tournament platform for mobile games in the worldOrganize and play made easy by AI and social media connection.

【Our Strengths】・Nationwide retail outlets・Sales skills of terminals・Sales channels of gift cards and digital

codes by Payment Service Business

Stepping into the eSports business which 5G will be the key factor.

・Organizing offline game tournaments at our retail stores and online tournaments

sponsored by our collaborators・Selling gift cards and digital codes on the game platform

And further planning ahead.

21

RIZAP50,000 yen rewarding

campaignended

Osaka Prefectural Gov.The campaign to encourage

wellness of its citizens.

UQ Communication Inc.Until End of March 2020

Recent Campaigns

The digital gift that can be used in physical retail stores, allowing enterprise customers to launch various types of promotional campaigns.

For updates and news on QUO Card Pay campaigns,please check its official website:

https://www.quocard.com/pay/campaign/

22

(As of Feb 1st 2020)

（守口本店のみ）（一部店舗） （一部店舗を除く）

（一部店舗を除く）（一部店舗を除く）

（一部店舗を除く）

（一部店舗を除く）

（一部店舗）（一部店舗）

（都城妻ヶ丘本店のみ）（プラスゲオ富久山店のみ） （一部店舗）

（一部店舗を除く） （一部店舗を除く） （一部店舗）

（一部店舗を除く）（一部店舗を除く）

（一部店舗を除く）（一部店舗）

※飲食店 一部店舗を除く

（一部店舗を除く）

（銀座博品館TOYPARK）（一部店舗を除く）

（一部店舗を除く）

（一部店舗）

Member Stores: where it can be used

Member Stores

Convenience Stores

Book Stores

Cafes / Restaurants

Drugstores

Lifestyle Stores

* I t s m em b er s tore d i f fer f rom th a t o f Q U O C a rd .

*●= QUO Card Pay only

23

23

Appendixes

24

24

TG Vision – Our Vision -

TG Mission – Our Mission -

TG Action – Our Code of Conduct -

● We will propose new ways of communication to provide our customers with excitement, delight, and safety

● We value our employees, as well as their families, and strive to establish a pleasant work environment for

everyone

● We will develop strong relationships with our business partners, regional communities and shareholders

toward our future mutual growth

● As a leading company in the industry, we will go ahead of changes to develop new businesses

● We will provide the highest-quality service exceeding any of someone’s expectations

● We will value communication and establish workplace with a culture of openness

● We will value our diversity and strive to achieve the best teamwork

● We will move ourselves higher as professionals

● We always act on high ethical standards and strengthen our compliance structure

【T-Gaia Corporate Philosophy】

● We will keep challenging something new aggressively with our passion and a sense of speed

25

The Midterm GoalsFrom November 2015, T-Gaia has set a medium-term goals to realize a sustainable growth and to respond to the expectations of all stakeholders including shareholders and employees by achieving the following objectives based on the corporate philosophy toward the FY 2020 (FY ending March 2021).

● Firmly maintain the position as the leading company in the core business of mobile phone distribution ● Grow solution business for corporate clients, settlement service and overseas business as a strong

core business● Create and explore new business opportunities in the mobile and internet industries● Maintain the dividend payout ratio over 30%

In order to realize the objectives noted above, T-Gaia is taking concrete measures every day, setting the following points as the company-wide strategy.

● Cultivate, recruit, utilize and retain human resources to realize maximization and optimization of

achievement of respective employees● Conduct strategic and continuous cost managements to transform the cost structure into one that can

response to the change of the market environment● Maximize the corporate-wide achievements by optimizing the organization as well as the corporate

system

Based on the above medium-term goals and company-wide strategies, T-Gaia will develop the business strategies for each business lines and make every effort to realize them through the concrete action plans in each business departments.

26Business Environment and The Strategies

The wide spread of smartphones allows people to connect to the world regardless of time. It has brought huge changes to the way people communicate, gather information and purchase.New types of businesses and services that were unimaginable in the past are now available. The market became more competitive and so as the chance of forming a new partnership.

Evaluations on the Business Environment

T-Gaia will accelerate the speed to become “a Comprehensive Provider of ICT-Related Domains”.The company will accelerate its investments in its digital services while making full use of its analog strengths, such as shops and sales bases across the nation, the diverse range of business models and well-established trades.It will strive to develop new businesses and services while maintaining the existing partnership within the group.

Strategies of T-Gaia

27

PaymentBusiness

B to B to C

Mobile PhoneDistributionBusiness for Consumers

B to C

SolutionBusiness

B to B

Wide variety of business

models

Wide range of business

relationship

Nationwide sales channels

(for mobile distribution business)

High flexibility and neutrality (low in in-house

products)

Financial condition kept in

good valance

CorporateGroup

Vision of Becoming “A Comprehensive Provider of ICT-Related Domains”

Digitalization

Cooperation

Cooperation

The Strengths of the Corporate Group

28

FY 19/3

943 1,006 1,0301,147

913983

850

1Q 2Q 3Q 4Q 1Q 2Q

FY 20/3

3Q

October 2019Revised Telecommunications

Business Act are in put in force

Quarterly Unit Sales

(Thousand Unit)

Unit Sales of FY2020 (Quarterly)

* Including WiFi terminals and MVNO handsets

* The unit sales of FY 19/3 has been modified as UQ WIMAX has been included into the calculation. (7000 units are added.)

29

3Q（October to December）

FY 20/33Q

FY 19/33Q

137.0

110.4

3.96

2.42

(Billion Yen)Net Sales Operating Profit

2.29

3.27

Net Profit

Financial Results in Quarterly Comparison

30Consolidated Forecasts for FY Ending March 2020

432.00

Full Year Results for 2019/3

Full Year Forecast for 2020/3

67.50

54.40

13.10

18.50

12.40

Gross Profit

Net Sales

SG&A Expense

Operating Profit

Attributable to Shareholders of the Parent Company

Net Profit

Ordinary Profit

Year-on-year

▲18.0％

▲4.9％

▲2.1％

▲10.2％

▲10.4％

（Unit: billion yen）

▲3.44

▲1.16

▲2.28

▲2.09

▲1.44

▲14.8％

▲94.92

5.40 ＋3.6％＋0.19Non-Operating Income(Income from Hoarded Cards , etc..)

526.92

70.94

55.56

15.38

20.59

13.84

5.21

31

● Continue to make strategic investments such as store

relocation and renovation

● Active investments in staff education and recruitment

of personnel for enhancement of sales ability and improvement of customer satisfaction

Forecasts for Mobile Telecommunications Business Segment

● Improving the ratio of revenue generated by

subscription services

● Reinforcing our “values in proposals” in response to

the drop in sales volume due to the complete separation of charges of mobile phone handset and communication charges (Smartphone instructional classes and IoT showrooms within shops, etc.)

FY 20/3 (Forecasts)FY 19/3

Forecasts of Mobile Telecommunications Business Segment

452.6

351.0

8.86 7.76

(Billion yen)Net Sales

Net Profit

11.5613.10

Operating Profit

The large swells that drive the industry are the law amendments regarding the sales of terminals in force from October and the foreseen establishment of a new carrier.The preparation for 5G has started.

The Business Environment

Our Strategies

32

● Expansion of revenue base of “TG Hikari”

Network Business

Mobile Enterprise Solution Business● Mobile version of LCM business are promoted

●IoT business put forward through capital alliance

with venture companies

Forecasts for Enterprise Solution Business Segment

Forecasts for Enterprise Solution Business Segment

● Productivity improvements by effective use of sales

support system

● Building up of subscription business such as ”movino

star”

FY 20/3 (Forecasts)FY 19/3 Results

26.5

31.0

1.68 1.71

(billion yen)Net Profit

2.482.43

Operating Profit

Net Sales

- Workstyle reform and shortage of labor are both tailwind.

- Installing smart devices are popular to enterprise customers.

- Information security issue are becoming more serious. - Re-wholesale of “Hikari” fiber-optic connection

service has started.

The Business Environment

Our Strategies

33

Payment Service Business

Overseas Business

● Increase in gross sales due to expansion of products and

sales channels

●Implementing large-scale sales promotion of "QUO Card Pay"

(the planned cost: approximately 1 billion yen)

● Preparing to launch a business in Vietnam

● Gross sales of gift card increased due to the

expanded sales channels at the luxury supermarket chain in Singapore

Gift card business and PIN business are steady.Cashless payment services using smartphone are expanding.

The Business Environment

Our Strategies

Forecasts for Payment Service Business and Other Business Segment

Forecast for Payment Service Business and Other Business Segment (Consolidated)

Net Sales

Operating Profit

Net Profit

47.7

3.282.93

50.0

▲0.16

▲0.94

FY 19/3 Results FY 20/3 Forecasts

(billion yen)

Reference: The Forecast for Payment Service Business and Other Business Segment (T-Gaia Alone)

Net Sales

Operating Profit

Net Profit (billion yen)

FY 19/3 Results FY 20/3 Forecasts

43.6 46.5

1.24

0.760.90

1.30

34

12.7

14.3

15.6

14.2 14.415.3

13.1

26.4%

29.4% 29.3% 29.7%30.9%

33.3%

24.5%*

Financial Information of T-Gaia: Part 1

● Transition of ROE & Operating Profit

FY 14/3 FY 15/3 FY 16/3 FY 17/3 FY 20/3（Forecast）

FY 18/3 FY 19/3

Operating Profit

(billion yen)

ROE (Return on Equity)

It has been selected to “JPX Nikkei Index 400” for consecutive years by maintaining high level of ROE

*The ROE of the FY 20/3（Forecast） is calculated based on the forecast of the net profit for FY 20/3 attributable to shareholders of the parent company and the prediction of the net worth of the period.

35

Year End (in billion) 2014/3 2015/3 2016/3 2017/3 2018/3 2019/3

Net Profit 6.83 7.74 9.49 9.69 10.16 13.84

Net Worth 23.59 29.10 35.81 29.36 36.44 46.73

Equity Ratio of Net Profit

（ROE)

26.4% 29.4% 29.3% 29.7％ 30.9％ 33.3％

Return on Investment (ROIC)

10.0% 13.5% 17.3% 17.6% 20.3% 22.0%

Operating Profit on sales

1.8% 2.2% 2.5％ 2.6％ 2.6% 2.9%

Dividend on Equity ratio (DOE)

10.0% 9.8% 9.1％ 9.9％ 9.3％ 10.0％

● The Past Trends and the Forecasts of the Key Financial Index

Financial Information of T-Gaia: Part 2

36

35.00 37.5043.00

52.0055.00

75.00

86.74

112.68

138.11

172.62182.34

242.24

222.5175.00

⚫ Net Profit per share ⚫ Dividend per share & Payout Ratio

40.3%

33.3% 31.1% 30.1% 30.2% 30.1%33.7%

Basic Dividend Policy Targeting & maintaining dividend payout ratio of more than 30%

Dividend per share Payout ratio

（yen） （yen）

* The net profit per share and dividend per share at the end of FY 20/3 are calculated based on the predicted average number of the share of the period at the end of FY 20/3.

FY 20/3（Forecast）

FY 18/3FY16/3 FY17/3FY15/3FY14/3 FY 19/3FY 20/3（Forecast）

FY 18/3FY16/3 FY17/3FY15/3FY14/3 FY 19/3

Return to Shareholders in FY ending March 2020

● Annual dividend: 75 yen/share (Interim: 37.5 yen/share, Yearend: 37.5 yen/share)

Financial Information of T-Gaia: Part 3

● Return to Shareholders: Dividend Policy