2024.3 Second Quarter Results

October 27, 2023

Enplas Corporation
Copyright ©2023 ENPLAS CORPORATION, All rights reserved

AgendaFinancial Results• 2024.3 Second-Quarter Results• 2024.3 Financial Forecast

Our Approach to Enhancing Corporate Value
Action to Implement Management that is Conscious of Cost of Capital and Stock Price

•••
•
•

Analysis & Targets
Our Approach to Enhancing Corporate ValueBusiness Opportunities Presented by Generative AI
Business Strategy
Cash Allocation (Reference)
Copyright ©2023 ENPLAS CORPORATION, All rights reserved2Financial Results

Copyright ©2023 ENPLAS CORPORATION, All rights reserved32024.3 Second-Quarter Financial Results（100 million yen）

2023.32024.3

1st Half Results

1st Half Results

210.9

192.0

-9.0%

195.0

COGS Ratio

52.5％

53.6％

+1.1pt52.5％

Operating Income

43.5
45.0
17.6

26.1
30.9
17.9

-39.9%

+2.1%

27.0
27.0
19.0

Earnings Per Share

199.84yen

203.81yen+3.97yen

215.36yen

Average Foreign Exchange rate (US$)

133.46yen

141.31yen+7.85yen

Sales

Ordinary Income
Profit attributable to owners ofparentChange-31.3%(Reference)
Plan（Planned rate）

130.00yen*FX sensitivity (US$): Sales Approx. 200 million yen / Operating income Approx. 150 million yen
Copyright ©2023 ENPLAS CORPORATION, All rights reserved42024.3 Second-Quarter Ordinary Income Analysis<2024.3 1st Half vs. 2023.3 1st Half >Salesdecrease（100 million yen）

SG&A Increase
Improved
COGS ratio

Changes in Nonoperating gain &loss

2023.3 1st Half
Ordinary Income

2024.3 1st Half
Ordinary Income
Copyright ©2023 ENPLAS CORPORATION, All rights reserved52024.3 Second-Quarter Results by Segment（100 million yen）Semiconductor

2023.3
1st Half Results

2024.3
1st Half Results

Sales

116.4

86.8

-25.4％COGS Ratio

48.1％

52.4％

+4.3ptOperating
Income

31.2
17.4

12.5
12.6

-60.0％COGS Ratio

53.5％

62.9％

+9.4ptOperating
Income

-1.6
18.4

-6.8
29.7

+60.9％COGS Ratio

36.6％

22.6％

-14.0pt

Operating
Income

7.4
58.6

16.4
62.7

+121.8％COGS Ratio

66.0％

68.0％

+2.0ptOperating
Income6.5

4.0-37.9％

Sales

Life ScienceSales

DigitalCommunication

Sales

Energy Saving
Solution

Copyright ©2023 ENPLAS CORPORATION, All rights reservedChange-27.7％+7.1％

6

Quarterly Results（100 million yen）

2024.32023.3
2Q
Sales

3Q

109.8 111.7

4Q

1Q

2Q

99.7

97.1

94.8

COGS Ratio

51.4％

49.4％

52.1％

53.2％

53.9％

Operating Income

23.9

27.0

17.5

14.1

12.0

Ordinary Income

23.6

24.4

18.3

16.8

14.1

2.5

18.7

9.8

7.3

10.6

29.45yen212.33yen

111.74yen

83.42yen

120.39yen

Profit attributable toowners of parent
Earnings Per Share

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

7Quarterly Results＜Sales＞（100 million yen）

109.8＜Operating Income＞（100 million yen）

111.7
27.0

101.1

99.7

97.1

23.9

94.8

90.2
82.3
78.8

19.5

77.5

17.5

14.1

13.8

12.0

8.7
7.8
5.6

1Q

2Q

3Q

2022.3

4Q

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.3

1Q

2Q

3Q

4Q

2022.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.38

Quarterly Results by Segment
Semiconductor

2Q

2023.3
3Q

4Q

1Q

2Q

Sales

59.8

64.4

53.3

46.7

40.1

COGS Ratio

46.3％

45.5％

45.7％

50.3％

54.8％

OperatingIncome

16.7
9.5

19.4
7.8

14.3
5.6

8.5
6.0

3.9
6.5

COGS Ratio

52.7％

54.0％

67.2％

63.9％

62.0％

Operating
Income

-0.5
9.0

-0.9
9.6

-3.8
9.6

-3.5
14.4

-3.2
15.2

COGS Ratio

34.5％

31.1％

28.4％

23.5％

21.8％

Operating
Income

3.8
31.3

4.3
29.7

4.0
31.0

7.8
29.8

8.6
32.8

COGS Ratio

65.5％

62.7％

67.8％

70.0％

66.1％

Operating
Income

3.9

4.1

2.8

1.3

2.7

Sales

Life ScienceSales

DigitalCommunication

Sales

Energy Saving
Solution（100 million yen）
2024.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

9Financial Results Overview
2024.3 Second-Quarter Financial Results◼Summary•

YoY sales and profit decreased, due to sales decrease in Semiconductor business, despite continued earnings growth in
optical fiber lens in Digital Communication business.
(Sales -9.0%, Operating Income -39.9%, Profit attributable to owners of parent +2.1%)◼Segment<Semiconductor business>• Sales decreased due to continuing adjustments in semiconductor demand.
• The recovery of demand adjustments has been slower than initially expected, but the demand is expected to increase in themedium term.
<Life Science business>•YoY sales decrease due to customers' production adjustments, etc.

Sales and profit growth<Digital Communication business>• In optical fiber lens, sales increased due to growth in high-end areas such as AI applications.
• Generative AI market is expanding due to advances in generative AI technology and beginning of social implementation.
• Maintain our high market share and expand its share through Value Engineering proposals and strengthening supply chain.
<Energy Saving Solution business>• Sales increased due to recovery of automotive production and expansion of low-noise and high-efficiency gear solution
business for automotive electrification.
• Profit decreased due to an increase in the allocation of expenses in the corporate division as a result of change in thesegment sales mix (27.8% → 32.7%).
Copyright ©2023 ENPLAS CORPORATION, All rights reserved

10

Financial Results Overview➢ SG&A（100 million yen）

2023.3 1st Half

2024.3 1st Half

Change56.6

62.9+6.3➢Labor cost: +3.1
➢Traveling and transportation expenses: +0.9
➢Research & development expense: +0.5

➢ Non-operating profit and loss

（100 million yen）

2023.3 1st Half

2024.3 1st Half

Change

1.5

4.7

+3.2

➢FX gain: 3.4 (FX gain for 2023.3 1st Half: 4.4)

➢ Extra-ordinary profit and loss

（100 million yen）

2023.3 1st Half

2024.3 1st Half

Change-15.3

-3.3

+12.0

2024.3 1st Half
➢Provision of allowance for doubtful accounts: 1.6➢Provision for loss on disaster: 1.0➢Business restructuring expenses: 1.0

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

112024.3 Financial Forecast

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

12Assumptions for 2024.3 Financial Forecast
Consolidated financial forecast• No change in the mid-term growth scenario, but conservative forecast for 2nd half due to slow recovery insemiconductor demand and uncertainties, especially in the 4Q.
• Planned rate (US$): 130.00yen → 140.00yen• Continue to invest in future growth. Reflect 2Q SG&A expenses. (2024.3: 13,300 million yen → 12,800 million yen)
Semiconductor business• Semiconductor demand adjustment is expected to continue in 3Q and beyond and the timing of recovery is expected
to be slower than previously expected.
• In the mid-term, demand is expected to increase mainly in server, automotive, and mobile applications, which Enplas
is focusing on.
Life Science business• Production adjustment by customers is expected to continue during the fiscal year.
Digital Communication business• In optical fiber lens, forecast is higher than July forecast due to growth in high-end areas such as AI applications.
Energy Saving Solution business• The forecast is higher than July forecast due to recovery in automotive production and expansion of low-noise, highefficiency gear solution business for automotive electrification.
Copyright ©2023 ENPLAS CORPORATION, All rights reserved132024.3 Financial Forecast（100 million yen）

2024.32024.3

1st Half Results

April Forecast

October Forecast

192.0

425.0

395.0

COGS Ratio

53.6％

52.1％

53.8％

Operating Income

26.1

70.0

54.0

Ordinary Income

30.9

70.0

60.0

Profit attributable to ownersof parent

17.9

50.0

42.0

Earnings Per Share

203.81yen

566.74yen

475.91yen

Dividends Per Share

30.00yen60.00yen

60.00yen

Net Sales

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

142024.3 Financial Forecast by Segment（100 million yen）

2024.32024.3

1st Half Results

July Forecast

October Forecast

Semiconductor

86.8

208.0

175.0

Life Science

12.6

28.0

28.0

DigitalCommunication

29.7

60.0

62.0

Energy SavingSolution

62.7

129.0

130.0

Copyright ©2023 ENPLAS CORPORATION, All rights reserved152024.3 Capital Expenditures, Depreciation, R&D (Reference)（100 million yen）

2023.32024.32024.3Results

1st Half Results

Full-year

Capital expenditures

23.7

19.8

40.0

Depreciation

22.4

10.9

24.0

R&D

12.8

6.7

14.0

*Capital expenditures not changed.
Copyright ©2023 ENPLAS CORPORATION, All rights reserved

16Our Approach to Enhancing Corporate Value
Action to Implement Management that is Conscious of Cost of Capital and Stock Price

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

17Analysis & Targets➢ Based on past performance, our ROE and PBR are highly correlated.

➢ Assumes cost of equity in the 7%-9% range.

Mid- & Long-termTargets

ROE 10% or more

Aiming for Sustainable Growth

Copyright ©2023 ENPLAS CORPORATION, All rights reserved18

Our Approach to Enhancing Corporate Value
Enhancing Social Value
Essential
Business
FieldCorporatePhilosophy➢ Connect our strengths with growth markets➢ Focus on infrastructure applications that areresident to change in the social environment➢ Business fields that enhance QOL for people
and the planet

Enhancing Customer Value

SolutionProvider➢ Strengthen the Supply Chain➢ Develop a Demand Chain➢ Improve Solution Development

ContinuousBusinessGrowth

Enhancing
Corporate Value

Value-addedratio
Improvement

SustainableGrowth

Enhancing Employee Value➢ Cultivate Human Resource Capability
Organizational ➢ Improve Human Resource System linked withCapability
Corporate Philosophy➢ Promote B/S based mind-set (Introduce Inhouse Company System)

Productivity
Improvement

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

ROE10％
19

Business Opportunities Presented by Generative AI

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

20

Business Opportunities Presented by Generative AI
Market Forecast

AI Server Shipment Forecast (2022 to 2026)

Semiconductor

Mid-term➢ Increase demand for Burn-in (“BI”) test(Thousand unit)• Recovery in demand for semiconductors.

2,500

38.4%

• Increase in reliability test due to growing
demand for servers for AI.

2,000

27.1%
1,500

26.0%

25.0%

Large BI Socketfor Server/PC

Mid- & Long-term➢ Business expansion in the System Level Test(“SLT”) area

1,000

• Aim to expand market share by increasing the lineup of
high-frequency compatible test sockets.

8.5%
50002022

2023(E)

2024(F)AI Server Shipment2025(F)

2026(F)

Digital Communication

YoY➢ Increase demand for optical fiber lens
AI Server Shipment

29.0

CAGR：% (Forecast)（2022 → 2026）*TrendForce 「Global AI Server Shipment from 2022 to 2026」
https://www.trendforce.com/presscenter/news/20230530-11692.html

Increase in the opticaltransceiver shipment

×➢ Developed 1.6Tbps lensShort- & Midterm

Increase in the optical fiber
lenses mounted on opticaltransceivers
Mid-term• Requires thinner, smaller, high-precision lenses.

Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1.6Tbps lens21

Digital Communication: Optical communication■Supercomputer use case

■Inside of the optical transceiver

Optical transceiver:
Module for converting “light” & “electricity“

Optical transceiver

Photoelectric converterEnplas Optical fiber lens

Optical transceiver insertion part

φ0.25mm*Pictures are courtesy and provided by Forschungszentrum Jülich
http://www.fz-juelich.de/portal/forschung/information/supercomputer/juropa■Function of the lens in photoelectric converter
To connect optical fiber and laser/photodiode with highefficiency.

Copyright ©2023 ENPLAS CORPORATION, All rights reserved22

Business Strategy: Semiconductor BusinessEnvironment◼ The market continues to decline, especially for server and mobile applications.
◼ Although the adjustment in semiconductor demand has lasted longer than initially expected, demand
for servers and automotive applications, on which Enplas is focusing, is expected to increase in themid-term.

Strategy◼ To handle changes, develop a demand chain and strengthen the supply chain.
◼ Strengthen a solution development system.

＜Sales＞（100 million yen）

＜Operating Income＞（100 million yen）

64.4
56.6

59.8

48.6
36.5

36.7

19.4

53.3
16.7

46.7
14.5

40.1

37.2

14.3

11.3
8.5
5.4

1Q

2Q

3Q

2022.3

4Q

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.3

1Q

4.5

4.6

2Q

3Q

3.9
4Q

2022.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.323

Business Strategy: Life Science Business
Environment◼ Expect growth of the genetic testing market in Life Science business.
◼ In genetic testing, customers continue to adjust their inventories.

Strategy◼ Clarify segments/applications and focus on high-function/high-value-added devices.
◼ Aiming to become profitable in the next fiscal year.

＜Sales＞（100 million yen）

＜Operating Income＞（100 million yen）

9.5
7.9

5.7

6.2

-0.5

6.7
5.9

-0.9

-1.07.8

5.6

6.0

6.5
-2.2-2.9-2.9-3.2-3.5

-3.7
1Q

2Q

3Q

2022.3

4Q

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.3

1Q

-3.8
2Q

3Q

4Q

2022.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.324

Business Strategy: Digital Communication BusinessEnvironment◼ In Optical fiber lens, business opportunities will expand due to advances in generative AI tech.
◼ In LED diffusion lens, sales declined due to lower demand.

Strategy◼ In Optical fiber lens, maintain our high market share and expand its share through Value Engineering
proposals and strengthening supply chain.
◼ In LED diffusion lens, secure profitability in existing areas and develop new solutions.

＜Sales＞
Optical fiber lens（100 million yen）

LED diffusion lens

14.4

＜Operating Income＞（100 million yen）

15.2

8.6
7.8

11.4

4.1
9.0
7.5

7.2
5.6

4.3

9.0

5.1

3.9

7.3

9.6

9.6

3.5

2.8
3.9
10.3

4.8

4.2

3.4

3.2

2.5

1Q

2Q

3Q

4Q

2022.3

9.4

4.0

4.3

5.1

6.1

1Q

2Q

3Q

2023.3

6.8

4Q

1Q

3.5

11.2

3.8

4.3

4.0

2.7

2Q

2024.3

1Q

2Q

1.8

2.0

3Q

4Q

2022.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.325

Business Strategy: Energy Saving Solution BusinessEnvironment◼ Demand is growing in the automotive market as economic activity resumes and the trend toward EVs
accelerates.
◼ In automotive, production is recovering due to improvements in global semiconductor shortage andparts procurement difficulties.

Strategy◼ Capture demand for EVs mainly in Europe, US and China.
◼ Grow in the Low-noise, High-efficiency Gear solution Business.

＜Sales＞（100 million yen）
31.3

28.6
26.7

26.8

27.4

29.7

31.0

＜Operating Income＞（100 million yen）

32.8
3.9

29.8

27.2

4.1

3.4
3.1
2.6

2.8

2.7

2.5

1.9
1.3

1Q

2Q

3Q

2022.3

4Q

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.3

1Q

2Q

3Q

4Q

2022.3Copyright ©2023 ENPLAS CORPORATION, All rights reserved

1Q

2Q

3Q

2023.3

4Q

1Q

2Q

2024.326

Cash Allocation (Reference)
Prioritize investments in new business, creating innovation and growth areas
Investment items

Payback Period

Assumed Effects

Expected investment
for the next 3 years(100 million yen)

New business / Creating Innovation
Environmental Investment
・Innovation Center (in Saitama Shintoshin)Long

Enhancing
Corporate Valuefor the future100-150

Mid

Profitability
Improvement70-120Short

Productivity
Improvement

60-70

・Reduction of environment impact

Investment in Growth area
・Essential Business Field
・IT System

Other Capital expenditures
・Mold Investment
・Replace aging equipment

Copyright ©2023 ENPLAS CORPORATION, All rights reserved27

Enplas Corporation
Financial Results for the Second-Quarter of
the Year Ending March 31, 2024

https://www.enplas.co.jp/english/
Any statements in this presentation which are not historical are future projections based on certain assumptions and executive judgments drawn from currently available information.
Please note that actual performance may vary significantly from any particular projection due to various factors.
Factors affecting our actual performance include but are not limited to: (i) changes in economic conditions or demand trends related to Enplas’s business operations; (ii) fluctuation offoreign exchange rates or interest rates; and (iii) our ability to continue R&D, manufacturing and marketing in a timely manner in the electronics business sector, where technologicalinnovations are rapid and new products are launched continuously.
All the information in this document is the property of Enplas Corporation. All parties are prohibited, for whatever purpose, to copy, modify, reproduce, transmit, etc. this information
regardless of ways and means without prior written permission of Enplas Corporation.
The official version of this announcement was published in Japanese. An unofficial English translation is provided for the convenience of overseas investors. For any discrepancies
between the Japanese and English versions, the Japanese version shall prevail.
Copyright ©2023 ENPLAS CORPORATION, All rights reserved