Wacoal Holdings Corp. of Kyoto, Japan, the World's Largest Manufacturer of Intimate Apparel, Reported Consolidated Results for the Six-Month Period Ended September 30, 2006 (April 1, 2006 to September 30, 2006).

KYOTO, Japan -- Net sales for the year increased 1.6 percent on a yen basis to 83.9 billion yen ($711.3 million), compared to 82.6 billion yen a year ago. Operating income increased 45.9 percent on a yen basis to 9.2 billion yen ($77.8 million) compared with 6.3 billion yen in 2006. Net income increased 40.4 percent on a yen basis to 6.2 billion yen ($52.7 million). Earnings per American Depositary Share (5 shares of common stock) were 216.3 yen ($1.83) on 28,782,000 average ADS shares outstanding compared to 154.0 yen earnings per American Depositary Share with 28,788,000 shares outstanding in the prior year.

During the six-month period ended September 30, 2006, the Japanese economy has shown steady improvement, with an increase in consumer spending due to an increase in household income, which in turn reflects the high level of corporate profits and improved employment. Overseas, the U.S. market has continued to show economic expansion and the Asian economy is generally moving from recovery to expansion. Business results in the woman's fashion industry were weak in general due to continuing low temperatures from the beginning of spring, as well as the prolonged rainy season.

In this environment, the group, primarily Wacoal Corp., which is the core business entity in our group, sought to improve the strength of its products and, while developing products focused on consumer needs, endeavored to develop new points of contact with customers through its directly managed stores, as well as internet and mail order sales. Regarding sales by business category, sales of textile goods and related products in the most recent six-month period was 76,205 million yen, a 0.7% increase compared to the previous six-month period. Other sales during the most recent six-month period was 7,723 million yen, a 11.9% decrease compared to the previous six-month period.

As for sales by location, Japan represented 71,593 million yen, accounting for 85.3% of group sales, whereas Asia accounted for 4.2% and Europe and the U.S. accounted for 10.5%.

FINANCIAL HIGHLIGHT

Net sales for the most recent six-month period was 83.9 billion yen ($711.3 million), a 1.6% increase compared to the previous six-month period. In terms of profit, the operating income for the current six-month period was 9.2 billion yen ($77.8 million), a 45.9% increase compared to the previous six-month period.

Pre-tax net income for the most recent six-month period was 9,647 million yen, a 44.1% increase compared to the previous six-month period, and net income for the most recent six-month period was 6,226 million yen, a 40.4% increase compared to the previous six-month period. The significant and gradual increase in operating income and other profits, in comparison with sales, have been greatly influenced by the implementation of our special voluntary retirement program for Wacoal Corporation, as well as efforts to reduce costs and expenses by winding up Fukushima Wacoal Sewing Corp. during the previous fiscal year.

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Note: Caution on the forecast

The Companies' forecast contains the view of the Companies' management based on the management's assumptions and beliefs in light of information currently available but should not be relied on solely in making investment and other decisions. Investor should be aware that a number of impact risks and uncertainties could lead to outcomes that differ materially from those presented in the forecast.

Wacoal's American Depositary shares trade at the NASDAQ Small Cap market under the ticker symbol "WACLY". The company's common stock is listed on the Tokyo stock exchange as well as on the Osaka stock exchanges.