Seiko Holdings Corporation
FY2017 3rd Quarter Consolidated Results Presentation
Summary of Q&A

Date:Thursday, February 15, 2018, from 3:00-3:50 p.m.

Place:Seiko Holdings Corporation, Head OfficeSummary of Q&A :Q1. I think results were steady in general, but how were conditions by area in
the Watches Business?
A1. The Watches Business had a slow start in Japan in the first half of the fiscal
year, but progressed steadily in the second half, and we achieved our plan.
Looking overseas, performance was steady in Asia. Hong Kong, Singaporeand China, in particular, performed significantly better than planned. InEurope, steady results were seen in Germany, where performance had
been favorable, as well as in the Netherlands and England. Conditions
continued to be challenging in the U.S., but overseas performance overall
remained close to the level expected. A weak yen also had a positiveeffect.

Q2. What are the trends for high-end and mid-priced products in the Japanese
domestic watch market? Demand for high-end products has recovered in
the watch market in this fiscal year, but it seems that the trend has not
spread to mid-priced products.
A2. High-end products are performing strongly, partly owing to the successful
independent branding of the Grand Seiko. However, sales have been
uneven for mid-priced products in the 100,000 yen range and under,
depending on the brand. Performance was steady for brands withstrengthened product strategies, such as Prospex and Presage. Amongaffordable-priced products, sales have been firm for simple and thin models.
On the whole, we do not consider products in the under-100,000 yen pricerange to be doing badly.

Q3. What are the reasons for the continuing struggle in the U.S., and what
measures will you take to break out of this situation?
A3. Overall sales in department stores, which are our main distribution
channels, are seen to have been mostly flat year on year, but we feel thatwatch sales have been sluggish.

We will bolster our high-end products with a view to recovery, whilepursuing product strategies to suit their respective distribution channels.

Q4. With regard to the 4th quarter plan for the Watches Business, a loss will
occur if results progress according to the full-year forecast. Are youexpecting to record any strategic expenses?
A4. We expect strategic expenses to be within the normal range.

Q5. What are your views on sales promotion strategies and expenses for
improving the top line of the Watches Business from the next fiscal year
onward?
A5. We will continue investment in advertising and promotion for products thatare key to increasing brand value. Also, our policy on expanding Seiko
Boutiques in the global market remains unchanged.

Q6. Will the level of capital investment and depreciation expenses decrease
from the next fiscal year onward, as a result of excluding the semiconductorbusiness from the scope of consolidation?
A6. Our capital investment and depreciation expenses were previously in therange of about 10 billion yen per year, but we expect the semiconductor
portion to decrease.

Q7. What are you focusing on in order to seek higher profits for the company asa whole, after the semiconductor business is gone?
A7. First, we believe it is important to resolve the issue of unprofitable productgroups within the Electronic Devices Business. In addition, we aim tofurther reinforce the earning capabilities of the Watches Business, which is
our main business.

End