YAMAZEN CORPORATION

Financial Results for FY3/23
May 23, 2023
Koji Kishida
President and CEO

Stock Code: 8051

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix

2

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix3

Introduction of the New President

Representative Director
and President

Apr. 1983

Joined the Company, In charge of marketing for theDomestic Machine Tools Division H.Q.

Apr. 2012

President of USA Branch of International Business
Division H.Q.; President (COO) of YAMAZEN INC.; andPresident of PLUSTECH INC.

Apr. 2016

Corporate Officer; Vice President of Machine Tools
Division H.Q. (in charge of overseas business),
General Manager of International Department andPresident of YAMAZEN (KOREA) LTD.

Apr. 2018

Executive Officer; President of Production Equipment
Business H.Q.

Jun. 2018

Director and Executive Officer

Apr. 2020

Director and Executive Officer; Vice President ofGeneral Sales H.Q. (in charge of overseas
business) and General Manager of the International
Department, Machine Tools Division H.Q.

Apr. 2022

Director and Executive Officer; Vice President ofGeneralSales H.Q. (in charge of overseas business)

Apr. 2023

Representative Director, President & CEO(to present)

Koji Kishida[Born on Sep. 2, 1960]

4

Management Philosophy

Management of Fostering
Personnel
To make active use of personnel, and to foster independentand virtuous employees

Management of Breaking
Through
To challenge, innovate and create

Management of Trust
To respond to the needs and expectations of society andcontribute to them5Outline of Business Segments
YAMAZEN(domestic and overseas)
Building materials

Clients

Users

5,000

3,000

Home products

Consumer goods (domestic)

Production equipment

Suppliers

About
companies

About
companies

FY3/23

Machine Tools Division
H.Q. (Machine tools, etc.)
Makers of factoryequipment,
devices, tools, etc.

Machine Tools
Sellers, Cutting Tool
Trading Companies,
etc. around Japan

Manufacturers
in JapanIndustrial Tools &Equipment Division*

Engineering andmaintenance services(Peripheral equipment for
production lines, etc.)

Exportcompanies

Makers of kitchen, airconditioning equipment,
and other housing
equipment

About

companies

Makers of furniture,
Electricalappliances, etc.

Home Products Division
H.Q.
(Electrical appliances, interior,exterior and leisure products, etc.)*Our private brand (PB) products
account for about 60% of sales.

62.7 billion yen

Industrial Tools& Equipment(Domestic)
Industrial Tools& Equipment(Overseas)

168.3 billion yen
33.6 billion yen

Overseas
manufacturers

Small and large-sizedhouse-builders,renovation
contractors, etc.
around Japan

FY3/2368 billion yen

Net sales: 168.7 billion yen(accounting for 32.0％ of total sales)
Segment profit: 7.3 billion yen
Margin: 4.3%

About 400
companies

600

Machine Tools(Overseas)

Housebuilders

Building Materials
Division H.Q.
(Building materials andequipment)

88.4 billion yen

16 overseas
subsidiaries and65 overseas
offices

About 2,900
companies

About 900

Net sales: 353.2 billion yen(accounting for 67.0% of total sales)
Segment profit: 13.9 billion yen
Margin: 4.0%
Overseas sales ratio: 27.3%

Machine Tools(Domestic)

DIY home centers, large retailers ofelectrical appliances, mass retailers ofhome appliances, online shops, TVbased mail-order firms, etc.

Building
Materials
Home100.7 billion yen
Products

Generalcustomers

E-commerce/B2C

6*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Division and Tools & Engineering Division. For details, see Slide 39.

Contribution to Social Issues Through Business(Production Equipment Business)
To support the sustainable development of the supply chain and the growth of each client’s business
Marketing staff of YAMAZEN (human capital) solve issues with clients by utilizing information and ideas(intellectual capital), networks, and engineering capability (manufacturing capital), to maintain or expand
social capital and earn revenues for YAMAZEN.
Suppliers

YAMAZENWant information
demanded by users.
Want to streamline
purchaseprocesses.

3,000

Production equipment

About
companies

YAMAZEN solves issues.

To collect information directlyfrom users, and give feedback
to distributors
To support purchaseprocesses

Makers of factoryequipment, devices, tools,
etc.

Users

Clients

5,000

About
companies

Want suppliers who cangrasp the needs from onsite workers
Want to improve theworking environment

Manufacturers
in Japan
Machine Tools Sellers,
Cutting Tool Trading
Companies, etc. aroundJapan

Machine Tools Division
Industrial Tools & Equipment
Division H.Q.

YAMAZEN solves issues.
To grasp the needs from users, and give
feedback to distributors
To propose products that would improvethe environment of each production siteWant support for not only
sales, but also the installationof machinery in factories

Overseas
manufacturers
It is difficult to sell
products to smallsized clients.
Lacking the marketing
function

YAMAZEN solves issues.

To support payment
settlement
To conduct marketingtargeted at distributors
around Japan

Export16 overseas
subsidiaries and65 overseas offices

YAMAZEN solves issues.

To offer not only products, butalso engineering, after-sales, andmaintenance services

7*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Divisions and Tools & Engineering Division. For details, see Slide 39.

Contribution to Social Issues Through Business(Building Materials Division)
To support the sustainable development of the supply chain and the growth of each client’s business
Marketing staff of YAMAZEN (human capital) solve issues with clients by utilizing information and ideas(intellectual capital), networks, and engineering capability (manufacturing capital), to maintain or expand
social capital and earn revenues for YAMAZEN.
Suppliers

YAMAZEN

Building materials

Want to provide clientswith a comfortable living
environment or working
environment.

About

900

companies

YAMAZEN solves issues.
To not only supply products, butalso propose forward-looking
solutions, while considering
amendments to laws and tax
regulations, and national policies

Users

Clients

About

YAMAZEN solves issues.

To design plans for process
management and construction,
manage progress, etc. until
completion

2,900

Hope tostreamline process
managementcompanies
Housebuilders

Building Materials
Division H.Q.
Makers of kitchen,
air-conditioning
equipment, and otherhousing equipment

YAMAZEN solves issues.
To support payment settlement
To conduct marketing targeted
at distributors around Japan

Small and large-sizedhouse-builders,renovation contractors,
etc. around Japan

Generalcustomers

Corporateclients

YAMAZEN solves issues.

It is difficult to sell products tosmall-sized clients.
Lacking the marketing function

To grasp the needs fromusers and give feedback
to distributors withinformation on subsidies Want a comfortable
house.
Want to curtail the costof utilities.

Want a comfortableworking environment.
Want to curtail the cost ofutilities.

8

Contribution to Social Issues Through Business(Home Products Division)
To support the sustainable development of the supply chain and the growth of each client’s business
Marketing staff of YAMAZEN (human capital) solve issues with clients by utilizing information and ideas(intellectual capital), networks, and engineering capability (manufacturing capital), to maintain or expand
social capital and earn revenues for YAMAZEN.

YAMAZEN

Suppliers

Users

Clients
YAMAZEN solves issues.

Home products・Want to procure
hot products in an
efficient way

About

YAMAZEN solves issues.
・To meet needs with our diverse
lineup including our original
products and products of othermakers, and contribute to theperformance of distributors

600

companies

About

400

To develop “original products of
YAMAZEN” as the series with goodfunctions, designs, quality, andprices, and supply them to themarketcompanies

YAMAZEN solves issues.

Home Products
Division H.Q.

To get products
useful for daily
life at low cost

Generalcustomers

DIY home centers, large retailers ofelectrical appliances, mass retailersof home appliances, online shops,
TV-based mail-order firms, etc.

E-commerce/B2C

Corporateclients

Makers of furniture,home appliances, etc.

Lacking themarketing orplanning function

YAMAZEN solves issues.
To support payment settlement
To conduct marketing targeted
at distributors around JapanTo plan private brand (PB)
products that would meet thepotential needs from consumers,
and outsource development andproduction

YAMAZEN solves issues.
To operate EC for conveying
functions and attractiveness of
products that are useful fordaily life and business, andprovide customers withinformation and products
swiftly

E-commerce/B2B

To acquire
products helpful
for business ataffordable prices

9Sources of Business and Competitive Advantages
Buyers (second-tier wholesalers, retailers, and end users)

Suppliers (makers)

About 5,000

About 3,000
companies Production equipment makers

商流

companies■Sales staff of makers

Commercial distribution

About 1,500 Consumer goods makers

Purchase staff of buyers

Prices, quantities
Distribution
Payment settlementcompanies

Buyers of production equipment

Business
Association

Domestic market

Global market
About 3,300

Buyers of consumer goods

companies

Competitive
advantage

Solid relationships with business partners and significant presence we fostered as a wholesaler in ourlong history in this industry✓

Strong relationships with suppliers and clients we have nurtured for over 70 years (The organization of suppliers: Sodality Association, theorganization of buyers: Ace Association)✓ Global network (16 local companies and 65 business locations outside Japan)

Flexible business operation with low risks✓✓

With minimum invested capital, it is possible to change or increase business partners flexibly and approach various markets.
To stick to the “procurement process while expecting order receipt”

Human resources for attaining our Management Philosophy✓

Marketing staff’s capabilities of gathering information, proposing plans, and negotiating tenaciously, which follow the ambition of the founder10

Robust Revenue Base Based on Continuous Transactions

We started business with wholesale of production equipment, developed
a revenue base with recurring transactions with many clients, added somespot transactions, transformed them into recurring ones, and expanded
our business domain and scale.
Current business model of
YAMAZEN[Business operation of YAMAZEN(schematic diagram)]
Fabless maker (Home Products)

・Wholesale (Machine Tools andIndustrial Tools & Equipment)

Increase of products and businesses
based on recurring transactions

Engineering (Domestic andoverseas)
Wholesale (Home
Products)
Wholesale (Building
Materials)

・Wholesale (Building Materials)
・Wholesale (Home Products)
・Engineering (Domestic and overseas)・Fabless maker (Home Products)

Wholesale (Machine Tools andIndustrial Tools & Equipment)

Inauguration of business

Present
11*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Divisions and Tools & Engineering Division. For details, see Slide 39.

Variation in Performance＝ Trading company specializing in production
equipment (inside and outside Japan) × consumer goods
Net sales and operating profit remained healthy thanks to robust
business despite the changes in the external environment.
Variations in net sales and operating profit [Billion yen]
600.0
526.3 billion yen
17.9

527.2
billion 20.0
yen

Novel
coronavirus(pandemic)

18.0

500.0

16.5

14.0

Bankruptcy
of Lehman
Brothers

400.0

16.0

12.0

300.0

10.0

8.0
200.0

6.0
4.0

100.0

2.0
0.0

0.0
FY3/08

FY3/09FY3/10FY3/11

FY3/12

FY3/13

Production Equipment

FY3/14

FY3/15

FY3/16

Consumer Goods

FY3/17

FY3/18Overseas, etc.

FY3/19FY3/20FY3/21

FY3/22

FY3/23Operating profit

12

Strengths of Businesses of Production Equipment and Consumer Goods■Production Equipment BusinessBusiness outline
MachineTools
domestic andoverseasIn collaboration with top makers inside and outside Japan, we offer
production and processing systems (cutting-edge hardware andsoftware) with machine tools for on-site operation, to support“manufacturing” inside and outside Japan.
Outside Japan, we have community-based sales systems and an
advanced engineering function in major industrial cities, andcomprehensively support the design of production lines, the installation ofmachine tools, and maintenance.

Industrial
Tools &
EquipmentWe meet a variety of needs (supplies, ancillary facilities, etc.) at
production sites, and provide an integrated system for improving
production efficiency through automation and labor-saving, and theenvironment of each production site, and adopting cutting-edge
technologies.

domestic andoverseas

The on-site engineering section automates production lines and selects
machines and blades that constitute the production lines. After thedelivery of equipment, we support the procurement of supplies andmaintenance consistently.

Major items handled
Machine tools (machining centers,
CNC lathes, CNC griding machines,
CNC milling machines, electric
discharge machines, conventional
machine tools, 3D printers, etc.), metal
forming machines, plate processing
machines, injection molding machines,
die-casting CAD/CAM, etc.

Material handling (devices for
distribution), mechatronics(mechatronic devices, robots, andlabor-saving equipment), aids forenvironmental improvement, cutting
tools, accessory tools, hand tools,
electric tools, Measuring equipment,
fluid machinery, etc.

Business model and strengths
Wholesale
Engineering(inside andoutside Japan)

Commercial distribution withsignificant cash flows although there
is no stock and profit margin is lowWe directly sell products tofactories while adding engineeringfunctions, achieving a high profit
margin.

WholesaleTo grasp latent needs from users
and propose solutions
Inventory control for swift delivery

WholesaleWith the model of wholesale ofbuilding materials and equipment tobuilders, etc., we deliver products
swiftly from delivery bases around
Japan. In this model, we have little
inventory, and a high cash flow.

WholesaleCommercial distribution withsignificant cash flows although there
is no stock and profit margin is low

FablessmakerProfit margin is high, thanks to thesale of PB products that meet
consumer needs.

■Consumer Goods Business
Building
Materials
domesticHome
Products
domestic

To comprehensively propose new products and systems aimed at realizing
society and living space that are friendly to people and the earth, including
environment-conscious, decarbonized, healthy, and barrier-free ones.
In detail, we procure and stably supply processed wooden products andprimarily and secondarily processed industrial products, propose and sellbuilding materials, equipment, devices, etc., and also concentrate onrenovation business.

We deal in familiar and useful products that are used in daily life, such ashome appliances, interior, exterior, leisure, and anti-disaster goods, andpossess functions as a trading company in the field of distribution andlogistics and as a maker that plans and develops original products.

Kitchens, cooking appliances, kitchen-related
appliances, bathroom appliances, washbasin
appliances, Water boiling equipment, Sanitary
appliances, air-conditioning/ventilationequipment, solar power generation, storage
batteries, floor heating, solar thermal water
heating equipment, stored-heat heating
systems, plumbing equipment & materials,
interior architectural materials, electricalequipment & materials, etc.

Planning, development, and sale of home
appliances (electric fans, heating equipment,
cooking equipment, audiovisual equipment,
lighting equipment), furniture, products foroutdoor and leisure activities, kitchen utensils,
daily goods, exteriors, gardening products,
agriculture products, Healthcare goods,
sanitary goods, industrial tools, goods forautomobiles and motorcycles, anti-disastergoods, etc.

13
*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Divisions and Tools & Engineering Division. For details, see Slide 39.

Growth Potential of Our Company (Domestic)■Domestic Production Equipment Business:
The domestic Production Equipment Business, which is the mainstay of YAMAZEN, has established a top-level presence in this industry.
The total sales of domestic production equipment makers is estimated to be about 13 trillion yen*, and the sales channels are being
diversified.
✓✓

In the market of production equipment makers, there are promising domains for our company, such as the domain of semiconductors.
Our company is expected to grow by adapting to diversified sales channels based on our unique marketing with expertise and added
value.

Total sales of domestic production
equipment makers
About 13 trillion yen*

Growth can be expected
through the expansion of ourshare in the first-tierwholesale market.
First-tier wholesalers and specialized
trading companies

MakersYAMAZEN(small, medium, and largesized)

256.8 billion yen

About 3,000
companies

In cooperation with distributors, we haveenhanced marketing with added value to propose
products of makers according to users’ needs, so
the business is expected to grow further.

Second-tier wholesalersand distributors

About 5,000 companies

Domestic production
equipment sales:EC

The EC channel, whose presence is becoming moresignificant, is a target of sale for YAMAZEN, so it would
lead to the expansion of our sales channels.

Users(mainly small andmedium-sizedfactories)

About 300,000
companies■Building Materials Division:✓ This business is expected to grow, through the expansion of our shares in the promising markets of solar power
generation, V2H, and non-residential business.
■Home Products Division:✓

Our company already handles top-class products in this category (such as electric fans and electrical blankets) and is
expected to grow by expanding sales channels and increasing products to be sold.

*Calculated from the sales of “266: Manufacturing industry in the metal processing machinery,” “267: Manufacturing industry in the semiconductor/flat-panel display manufacturing equipment,” and “269: Manufacturing industry in other production
machinery and components” taken from “Economic Conditions Survey in 2020” by METI.

14

Growth Potential of Our Company (Overseas)■Overseas Production Equipment Business:
We sell the products of Japanese-affiliated and local makers directly to users while offering engineering support services ina seamless manner, boasting top-class performance in the world.
Further growth can be expected, through enhancement of the following activities in addition to the already establishedpresence outside Japan.
✓

Geographical expansion and reform of the target market (improvement of our presence in the European and Indian markets,and so on)✓✓

Promotion of cross-border marketing strategies (support for investment in each country, etc.)
Enhancement of initiatives in growing industrial fields (EVs, semiconductors, electronics, telecommunication, medical, etc.)

Yamazen Group’s global network

Europe2 countries
2 businesslocationsNorth
America
1 country
15 businesslocationsAsia
11 countries
and regions
46 businesslocationsJapan
53 businesslocations

Central andSouth America
1 country
2 businesslocations

15 countries and regions overseas
16 local companies overseas
65 overseas business locations

We have 65 offices in major industrial cities of 15 overseas countries/regions, andabout 40% of employees of our corporate group engage in overseas business. We
offer services based on community-based sales structures and an advanced
engineering function.

Overseas
92.7
FY3/23
Sales of production
equipment
353.2(billion yen)

Japan
260.4

Ratio of overseas sales in Production
Equipment Business: 27.3% (up 1.0 pt
from the previous term)

15

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix

16

Setting Our Purpose and Corporate Vision for 2030

Pioneering a new future, with you all

Leading worldwide manufacturing and enriched lives

17

Toward the Realization of the Vision for 2030
Vision for 2030:
Leading worldwide manufacturing and enriched lives

Vision for 2030
2025-2027
FY3/24
Net sales: 600 billion yen
Operating profit: 21 billion yen(margin: 3.5%)

2022-2024
Pioneering a new future, with you all

Leading worldwide manufacturing
and enriched lives-To establish the company-wide basefor improving profitability
FY3/22
Net sales: 501.8 billion yen
Operating profit: 17.1 billion yen(margin: 3.4%)

Strategies for realizing our corporate vision
Client closenessstrategy

Transformation strategy

Digital convergencestrategy

Talent management strategy

18Strategy and Investment for Fortifying Our Robust Revenue Base ThroughContinuous Transactions

We will create stable cash flows by fortifying the “recurring revenue base,” which
is our forte, conducting investment for maintaining competitive advantages, andadding sales from solutions to meet demand in each theme.
Solutions to meetdemand in themes,such as PPA[Business operation of YAMAZEN(schematic diagram)]+

Increase of products andbusinesses based onrecurring transactions

Fabless maker (Home Products)

Engineering (inside andoutside Japan)
Wholesale (Home
Products)
Wholesale(BuildingMaterials)(automation, labor saving,
etc.)
Client closenessstrategy
Transformation
strategy

Wholesale (Machine Tools
and Industrial Tools &Equipment)

Inauguration of business

Further fortificationof the establishedbusiness model of
YAMAZEN

Present

Digital convergencestrategy
Talent management
strategy
Strategies for realizing
our corporate vision

Growth investment
budget in themedium-term
management plan
“CROSSING
YAMAZEN 2024”
Business investment(including alliances)
M&A, new business,etc.
20 billion yen
Investment in DX
and systems
Initial systemestablishment, etc.
10 billion yen

Capital investment,
logistics equipment,
etc.
10 billion yen

19*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Divisions and Tools & Engineering Division. For details, see Slide 39.

Strategy for Realizing Our Corporate Vision (1) Client Closeness Strategy◼ Our company-wide client closeness strategy is to improve direct contact points
with clients, deepen expertise, pursue needs from clients, and expand sales.

Strengthening of themarketing support
systemEnhancement of marketing
and remote sales promotion

YAMAZEN

Information site
To improve our EC site

Largecompanies

SMEs

Other growing
businesses

To convert each marketingknow-how into explicit
knowledge

Enhancement of thedigital channel

In JapanAutomobiles

Systematization ofmarketingFood products, medical,
and cosmetics

To clarify growing markets
To deepen expertise

Clients, users, subusers, and general
consumers

Semiconductors

Strategy in each segment

Real channel

To foster win-win relationships, by grasping the issues faced by clients around theworld from their viewpoints and proposing solutions

Digital channel

ClientclosenessstrategyDistributors
Sub-users

Retailers

Localization ofoverseas affiliates
To train local staff

Generalconsumers

Overseas
Japanese-affiliated

Local
20

Strategy for Realizing Our Corporate Vision (2) Transformation Strategy◼ We aim to expand profit based on a new revenue base, by transforming the conventional businessstructure significantly.

Transformation
strategy

To offer comprehensive solutions, including product manufacturing,
engineering, and green business, in addition to the sale of products.

Contribution to
production lines andconstruction sites

Specialized
tradingcompany
dealing in
production
equipment andconsumer
goods

Green
business

To solve environmental issues

Engineering

Transformation

To become anengineering trading
company that can offer
comprehensive solutions

Product
development

Strengthening of the system fordeveloping products andservices with high added valueNewbusinessmodel

To establish a newrevenue structure,including continuous
charging business

Logistics
systemUpgrade of the logistics system
21

Strategy for Realizing Our Corporate Vision (3) Digital Convergence Strategy◼ We aim to create new business opportunities, by increasing contact points withcustomers based on the strengths of real human resources and digital resources
and providing new solutions.
Digitalconvergencestrategy

To strengthen contact points with customers by utilizing digital technologies, offer
new solutions, connect the “knowledge” obtained through them with real humanresources, and then create new added value◼ Front

To offer more digital
services and enhance EC

Distributors & users of production
equipment and users of consumer goods

Users of production
equipment

Sale of products

Sale of services

Creation of new
business

To combine
technological andbusiness opportunities,
and provide
opportunities to solve
issues

To establish a base foroffering services forcreating a new revenue
structure

YAMAZEN
BizcomB2B site
IoT◼ Middle

To improve productdevelopment andmarketing capacities byutilizing data

Data-driven management base
To connectdata

To process data
(to make them more valuable)

To analyze data andproduce logical models

To store data

To visualize
data◼ BackImprovement in incompany operations

Enterprise resource planning (ERP) system

To strengthen DX strategies and organizational functions
To design DX strategies, establish DX methods, and improve the capability of proceeding with DX by securing and training
personnel specializing in digital technologies

22

Strategy for Realizing Our Corporate Vision (4) Talent Management Strategy◼ To design and implement HR management strategies for satisfying the requirements for actualizing
management and business strategies and achieving sustainable corporate growth (corporate value
improvement), and strengthen human capital
Talentmanagement
strategy

Under the HR principle “to develop personnel who can take on challenges, ponder, and take action” andthe HR management policy to “promote endeavors, thinking, and actions,” we will accelerate the shift to“HR management” for enhancing the development of a company that can grow sustainably andpromote it further.

Talent management based on
management and businessstrategies
To summarize the requirements fordiverse human resources who
actualize management andbusiness strategies
To secure and pool required
human resources

Evolution of the base fordeveloping self-motivatedemployees
To diffuse and evolve new
personnel systems for acquiring,developing, and treating required
human resources

Education, training, skill
development, and lectures

Strengthening of
human capital▼
Improvement incorporate value
Diversity & Inclusion
Independent career
To establish an environment inwhich employees can create value
by polishing and exerting theirabilities based on diversity, cocreation, thinking, and actions.

To develop bases for educating
personnel and developing theirskills and promote them for
acquiring human resources

Well-Being of YAMAZENTo establish an environment inwhich employees can take onchallenges, think, and take actions
To improve employees’
engagement and motivation bypromoting management oriented formental and physical health23

To Strengthen Wholesale Business by Investing in Logistics◼ We aim to improve the productivity of the logistics function, to strengthen the wholesale
business, which is a revenue base.
By expanding the target area for delivering products with our own system without relying on predetermined delivery routes, we will copewith the problems in 2024, curtail costs for transportation and delivery, expand the target area for delivering products on the day of orderplacement or the following day, and optimize dispersed inventory according to the demand in each area, to improve services.
From now on

Factories and warehouses of makers

Conventional

Products in stock
Back-ordered
products

Shipment via

Clients predeterminedroutes
Shipment via
Clients predeterminedroutes

Shipment via
predeterminedroutesClients

Logisticalwarehouse of
YAMAZEN

Products in stock
Back-ordered
products

Clients

Shipment via
predeterminedroutesDepot
Directdeliveryarea

Stock ineach area

Stock at Direct delivery area
each base

Clients

Factories and warehouses of makers

Start of dual-distribution system(operation of “Okayama Depot”)

Depot
Directdeliveryarea

predeterminedroutes
Logisticalwarehouse of
YAMAZEN

Clients

Stock ineach area

Direct delivery area

Depot
Directdeliveryarea

Stock ineach area

Marketing operation

Measures implemented in Jan. 2023
Full-scale operation of “Logistics Center
Shin-Tokyo” equipped with LMS and WMS

Stock ineach area Shipment via

Stock ateach base

Clients

Shipment via Clients
predeterminedroutesClients

Products in stock
Back-ordered
products

Depot
Directdelivery
area

Depot
Directdeliveryarea

LMS・WMS

Clients
Stock ineach area

Marketing operation

Future measures
Optimizationof groupwide
logistics
functions

Establishment of a “NewLogistics Center in Osaka”
Strategic base of the Industrial Solution Division
and Tools & Engineering Division in western JapanTo enrich items in stock, and actualize optimaldelivery24
We aim to start full-scale operation in Jan. 2025.

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix25

FY3/23 Consolidated Profit and Loss Results (1)Consolidated Profit and Loss Statement(Million yen)

FY3/22(76th term)

FY3/23(77th term)

Announced
forecast

YoY change

Difference fromthe forecast

Net sales

501,872

527,2635.1%

530,000-0.5%

Gross profit

72,73878,2797.6%--(Gross profit margin)

14.5%

14.9%

0.4ppt--SG&A expenses

55,60461,716

11.0%

-

-

Operating profit

17,133

16,563-3.3%

16,000

3.5%(Operating profit
margin)

3.4%

3.1%

-0.3ppt

3.0％

Non-operating
profit/loss

-39

717

-

-

-

Ordinary profit

17,093

17,2801.1%

16,0008.0%

Extraordinary
gain/loss

754

53

-

-

-

12,023

12,5274.2%

11,00013.9%

Net income
attributable to ownersof parent

Gross profit increased by 7.6% YoY due to growth in net sales and improved gross profit margins.
On the other hand, operating profit decreased by 3.3% YoY due to an increase in depreciation and amortization and otherexpenses associated with the introduction of SAP ERP system as a growth investment, which is set forth in the medium-term
management plan, and an increase in personnel expenses as an investment in human capital.
26

FY3/23 Consolidated Profit and Loss Results (2)Net sales: Quarterly trends (last 3 years)
FY3/21(Million yen)

FY3/22

FY3/23160,000

126,863

140,000

121,983
120,000

132,174

134,954

116,569

129,747
114,310

133,572

133,271

116,067

105,640

98,725100,000
80,00060,00040,00020,000
0
1Q

2Q

3Q

4Q

27

FY3/23 Consolidated Profit and Loss Results (3)Net sales by business(Million yen)

FY3/22(76th term)

FY3/23(77th term)

YoY change

Machine Tools Division

143,157

151,214

5.6%

Industrial Tools & Equipment
Division

187,785

201,989

7.6%(Total for Production
Equipment Business)

330,942353,203

6.7%

Building Materials Division

62,16968,031

9.4%

Home Products Division

104,866

100,711-4.0%(Total for Consumer Goods
Business)

167,036

168,742

1.0%

Other Business

3,893

5,317

36.6%

Total

501,872

527,263

5.1%*Ogaki Kiko Co., Ltd., which had been classified as “Other Business,” has been included in “Production Equipment Business” since the 1Q of FY3/23 due to the revision of the performance
management segment of our group. Results by business for the previous fiscal year are based on the revised reportable segment classification.
*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Division and Tools & Engineering Division. For details, see Slide 39.

28

Overview by Business (Production Equipment) (1)Domestic Machine Tools Business: We received orders for semiconductor manufacturing equipment and machine tools for processing componentsof construction machinery in the previous term, and sales were healthy in this term.
Domestic Industrial Tools & Equipment Business: Measurement equipment, material handling equipment, mechatronic devices, etc. sold well.
Annual performance of cutting tools, auxiliary tools, etc. improved from the previous fiscal year, despite the decrease in factory utilization rate in theautomobile industry in the second half of the term.
Overseas Production Equipment Business: In North America Branch, capital investment for healthcare, aircraft, EVs, etc. progressed healthily, andthe sales of cutting and auxiliary tools were healthy. China Branch sold machine tools for EVs, semiconductors, etc. healthily, and ASEAN Branch soldproducts healthily in the fields of automobiles, aircraft, and air-conditioning equipment. In Taiwan Branch, the sale to EMS enterprises declined.

FY 3/2022

Production equipment(Million yen)

Machine Tools
Division
Industrial Tools &Equipment Division
Total for Production
Equipment Business

Domestic sales
Overseas sales
Total
Domestic sales
Overseas sales
Total
Net sales
Operating profit
Operating profit
marginFY 3/2023

YoY change

78,21464,942
143,157
160,416
27,369187,785
330,942
13,56688,49862,715
151,214168,338
33,650201,989353,203
13,965

13.1%
-3.4%
5.6%
4.9%
22.9%
7.6%
6.7%
2.9%

4.1%

4.0%

-0.2ppt*Ogaki Kiko Co., Ltd., which had been classified as “Other Business,” has been included in “Production Equipment Business” since the 1Q of FY3/23 due to the revision of the performance
management segment of our group. Results by business for the previous fiscal year are based on the revised reportable segment classification.
*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Division and Tools & Engineering Division. For details, see Slide 39.

29

Overview by Business (Production Equipment) (2)FY3/22

Production
equipment(Million yen)

Total for
Production
Equipment
Business

330,942

Net sales
Operatingprofit13,566

100,000

Up 0.9% YoY

28.7%
Industrial Tools &Equipment Division

38.3%

YoY
change6.7%

13,965

Operatingprofitmargin4.0%

Machine Tools (Domestic)
Machine Tools (Overseas)
Industrial Tools & Equipment (Domestic)
Industrial Tools & Equipment (Overseas)(Million yen)Up 0.2% YoY353,203

Quarterly net sales (last 3 years)

Sales composition

Machine Tools
Division

FY3/2375,00050,00025,000

0

1Q

2Q
3Q
FY3/21

4Q

1Q

2Q
3Q
FY3/22

4Q

1Q

2Q
3Q
FY3/23*Ogaki Kiko Co., Ltd., which had been classified as “Other Business,” has been included in “Production Equipment Business” since the 1Q of FY3/23 due to the revision of the performance
management segment of our group. Results by business for the previous fiscal year are based on the revised reportable segment classification.
*In April 2023, Industrial Tools & Equipment Division was divided into Industrial Solution Division and Tools & Engineering Division. For details, see Slide 39.

4Q

30

Overview by Business (Consumer Goods) (1)Building Materials Division: Against the backdrop of renovation demand, we focused on proposing high-value-added products, and sales of waterboiling equipment and water-related equipment remained firm. In the non-residential sector, in response to corporate demand for cost-cutting
measures in the face of rising utility costs, we strengthened proposals for facility renovations that combine our products and construction, and salesof new energy equipment, etc. were strong.
Home Products Division: Sales and profits declined since the “stay-at-home” demand by COVID-19 has settled down and consumers’ willingness
to buy has declined due to soaring raw material, electricity and gas prices and price hikes caused by the sharp depreciation of the yen. On the other
hand, sales of private-brand products that meet consumer needs were strong. In particular, the performance of unique home appliances with added
value, such as electric fans, circulators, and cooking machines, improved from the previous term.

FY3/22(Million yen)Consumer goods

Building Materials
DivisionHome Products
Division

Total for Consumer
Goods BusinessNet sales
Operating profit
Operating profit
marginNet sales
Operating profit
Operating profit
marginNet sales
Operating profit
Operating profit
marginFY3/23

YoY change

62,1692,250

68,031
2,341

9.4%
4.0%

3.6%

3.4%

-0.2ppt

104,866
5,801

100,711
4,960

-4.0%
-14.5%

5.5%

4.9%-0.6ppt

167,036
8,051

168,742
7,301

1.0%
-9.3%

4.8%

4.3%

-0.5ppt31

Overview by Business (Consumer Goods) (2)FY3/22

Consumergoods(Million yen)

62,16968,031

YoY change

9.4%

2,250

2,341

Operatingprofit margin

3.4%

Net sales

104,866

100,711

YoY change-4.0%Operating profit

5,801

4,960

Operatingprofit margin

4.9%

Net sales
Building Materials
Division
Operating profit
Home Products
Division

FY3/23

Quarterly net sales (last 3 years)

Sales composition

Building Materials
Home Products(Million yen)

50,000Home Products Division

19.1%

Down
1.8% YoY

Building Materials Division

12.9% Up 0.5% YoY

40,00030,00020,00010,0000

1Q

2Q
3Q
FY3/21

4Q

1Q

2Q
3Q
FY3/22

4Q

1Q

2Q
3Q
FY3/234Q

32

Factors for Changes in Operating Profit(Million yen)

Increase ingross profit

Increase in
SG&A expenses

5,541

6,111

Operating profit

Operating profit

17,133

FY3/22

Machine Tools
Industrial Tools &Equipment
Building Materials
Home Products
Other+2,414+3,604+432-1,104+194

Personnel expenses+2,734

Commission paid

+1,271

Depreciation andamortization
Travel expenses
Sales promotion costs
Other-569 from theprevious term

+1,28816,563

+482
+508
-173

FY3/2333

Consolidated Total Assets

Assets(End of Mar. 2022)

Liabilities and Total Assets(End of Mar. 2023)(End of Mar. 2023)

Current liabilities
Current assets

2,359

+26

2,385

1,441
Long-term liabilities

209
467

+36

Noncurrent assets andNet assets

deferred tax assets

1,237

ｰ47

1,489

+6

203

+103

1,133

+62

2,826

503

Total assets
End of Mar. 2022

Item

End of Mar. 2023

10.9%

ROE

10.6%

1,268.98 yen

Shareholders’equity ratio
Net assets per
share

1,383.65 yen

83.8 billion yen

Market cap

90.3 billion yen

12 billion yen

Basic operating
cash flow

14.4 billion yen

39.9%(End of Mar. 2022)

42.6%

2,888

(Unit: 100 million yen)
*ROE, shareholders’ equity ratio and net assets per share are taken from thefinancial results summary.
*Market capitalization is calculated by multiplying the closing price at the endof the fiscal year by the number of shares outstanding (including treasury
shares) on the same date.
*Basic operating cash flow is calculated by deducting the increase/decrease inworking capital from operating cash flow.
*Amounts less than 100 million yen have been rounded.

34

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix35

FY3/24 Disclosed Full-year Plan

(Million yen)

FY3/2377th term result

FY3/2478th term planYoY change

Net sales

527,263550,000

4.3%

Operating profit

16,56315,000-9.4%

Operating profit
margin3.1%

2.7%-0.4ppt

Ordinary profit

17,28015,000-13.2%

Profit attributableto owners ofparent12,527

10,000-20.2%

Sales are expected to hit a record high.
Profit is projected to decline, because depreciation and amortization, etc.
36
will be posted due to the acceleration of investment for growth.

FY3/24 Forecasts for the Production Equipment BusinessNet sales
plan(Million yen)

Production Equipment
Business

Full year

Operating profit
plan

YoY change

373,000

5.6%

YoY change

14,500Operating profit
margin3.8%

3.9%

Production Equipment Business: 3-year sales trends and full-year forecasts
400,000

353,203
330,942350,000
300,000
250,000

265,059

27,369160,416✓

needs in production sites, such as

33,650“automation and labor saving” and86,000“decarbonization” at an accelerated
pace.

168,338
97,000200,000✓

Approach to new domains ofsemiconductors, logistics, 3 major

141,885

product industries (food, medical

150,000

64,942100,000

62,71565,00050,00060,007

78,21488,49894,000FY3/22

FY3/23

FY3/24 (plan)

FY3/21

Machine Tools (Domestic)
Industrial Solution
Industrial Tools & Equipment (Overseas)

and cosmetics), etc.
✓

43,6210Each division will brush up expertise,and provide solutions to meet the

31,000Former Industrial Tools& Equipment Division

19,544

373,000

Machine Tools (Overseas)
Tool & Engineering

Outside Japan, we will
geographically expand andrestructure target markets, andenhance borderless marketing andinitiatives in growing industries.

*Ogaki Kiko Co., Ltd., which had been classified as “Other Business,” has been included in “Production Equipment Business” since the 1Q of FY3/23 due to the revision of the performance management segment ofour group. The above performance in FY3/21 is based on the reportable segments before the revision.

37

Initiatives in the Automation and Labor-saving Fields◼

To cultivate growing markets of semiconductors, logistics, 3 major product industries (food, medical andcosmetics), etc.

◼

To propose highly technical automation and labor-saving systems from the viewpoint of each client◼

To enhance the engineering and network functions inside and outside the company

38

Organizational Reform of Industrial Tools & Equipment Division
In addition to the trends of development of EVs in the automobile field and automation and labor saving to cope with the decrease of theworkforce, the initiatives for carbon neutrality and digitalization of business changed the flow of information. In particular, commercesites and logistics systems evolved remarkably.
In order to actualize the corporate vision for 2030, YAMAZEN will maximize “expertise,” which is demanded and recognized in the market,
and differentiate our products from competitors’. To do so, we divided Industrial Tools & Equipment Division into “Industrial Solution
Division” and “Tools & Engineering Division” in April 2023.
We will extract and summarize the characteristics of each product category and issues with them, conduct investment based on growthstrategies for each category, and swiftly implement business strategies while expecting profitability and potential as specializedbusiness.

Industrial Tools & Equipment Division
Divided in Apr. 2023

Industrial Solution Division

Tools & Engineering DivisionMajor product categories:
Proposing systems that contribute to automation, labor saving,
and carbon neutrality of production sites, including material
handling devices, mechatronic devices, and environmentallyfriendly equipment, and selling components
Priority fields:
To give comprehensive solutions to the “shortage of workers,”“decarbonization,” “digitalization,” etc. facing small andmedium-sized enterprises and local users
To establish a system for giving proposals to meet needs fromindividual users
To focus on the cultivation of new industries and the direct
approach to users
To enhance the development of original products and systems

Major product categories:
Cutting tools, auxiliary tools, measurement tools, work tools,
electric tools, and hydraulic and pneumatic tools
Priority fields:
To acquire a market share by enhancing the technicalmarketing capability in the peripheral field of machine tools
To receive more repeat orders from users in parallel with the
expansion of commercial distribution
To redevelop operation bases (Internet infrastructure andlogistics functions), establish a system for swiftly supplying
information and products to users, and differentiate ourbusiness from competitors’.
39

FY3/24 Forecasts for the Consumer Goods BusinessNet sales
plan(Million yen)

YoY change

Operating profit
plan

YoY change

Operatingprofit margin

Building Materials Division

Fullyear

71,000

4.4%

2,400

2.5%

3.4%

Home Products Division

Fullyear

105,000

4.3%

5,800

16.9％

5.5%

Consumer Goods Business: 3-year sales trends and full-year forecasts

175,000

162,121167,036

168,742

104,866

100,711

Building Materials Division✓ Continue proposal-based sales of highvalue-added products

176,000✓

Expand sales of new energy equipment
for decarbonization (solar power
generation, storage batteries, etc.)✓

Strengthen the system for managing
orders and construction for facility
renovation projects in non-residential
sector.

150,000
125,000
100,000

103,379

105,000

75,00050,00025,000058,741

62,16968,031

71,000FY3/21

FY3/22

FY3/23

FY3/24 (plan)

Building Materials

Home Products

Home Products Division✓ Develop new products that meet
consumer needs and popularize own
brands✓Expand the online shop (YAMAZEN
Bizcom)40

Initiatives in the Consumer Goods Business

Building

Enhancement of activities for proposing solar
power generation for private consumption

Original ZEH “ZePlus”

materials

Home
products

B2B EC site “YAMAZEN Bizcom”

Enhancement of our marketing capability
and acceleration of development of PB
products

41

Medium-Term Management Plan: Disclosed Plan for
Sales/Profit/Management Indicators(Million yen)

FY3/22(76 term results)th

FY3/23(77 term results)th

FY3/24(78 term plan)th

FY3/25(Final-year plan)

501,872
17,133527,263
16,563550,000
15,000600,000
21,000Operating profit margin

3.4%

3.1%

2.7％

3.5%

Ordinary profit

17,093

17,28015,00021,000profit12,023

12,527

10,00014,000Net sales
Operating profit

Indicators(Million yen)

FY3/22(76 term results)th

FY3/23(77 term results)th

FY3/24(78 term plan)th

FY3/25(Final-year plan)

Return on equity
(ROE)

10.9%

10.6%

7.9％

10.0%

Basic operating cash flow

12,052

14,427

14,50018,000Shareholders’ equity ratio

39.9%

42.6%

40-45%

40-45%
42

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix43

Shareholder Returns➢ FY3/23: Paid an interim and year-end dividend of 20 yen per share each, for an annual dividend of 40 yen per share.
➢ FY3/24: Plan to pay an interim dividend of 20 yen per share and a year-end dividend of 25 yen per share, for anannual dividend of 45 yen per share.
140.0050
Profit per share

120.0040.0

Dividend payout ratio

40

35.0

33.0

100.00
80.00

28.0

30.2

26.2

28.4
30

24.9
30.6
128.80

60.00
98.01

40.00

133.74107.79
90.82

85.60

141.0020112.56

80.25

10

20.00
0.00

0
FY3/16

FY3/17

FY3/18

FY3/19FY3/20FY3/21

FY3/22

FY3/23

FY3/24 (plan)

FY3/18

FY3/19FY3/20FY3/21

FY3/22

FY3/23

FY3/24(plan)

Total for the last 3 years
FY3/22-FY3/24
plan

Interim

13.0

15.0

16.0

10.0

10.0

20.0

20.0

50.0

Year-end

*19.5

*21.0

14.0

10.0

*25.0

20.0

25.0

70.0

Annual

*32.5

*36.0

30.0

20.0

35.0

40.0

45.0

120.0

Payout ratio (%)

30.2

28.0

35.0

24.9

26.2

28.4

40.0

31.0

Dividend paid
(million yen)

3,074

3,405

2,837

1,891

3,115

3,560

4,006

10,681

733

-

-

-

5,999

-

-

5,999

Dividend per share (yen)Amount of treasury stockacquired(million yen)-

44
*Includes special dividends and commemorative dividends

Cash Allocation✔ A new stage of investment for growth after the stage of enriching capital

Medium-term management plan

FY3/23

FY3/24

FY3/25Investment inbusiness

20 billion yen
Basic operating
cash flow

0.8

- yen

- yen

- yen

- yen

billion yen

Investment
for growth

Investment in DX
and systems

Total for 3 terms
About 48 billion yen

10 billion yen
Shareholder
return3.1
billion yen

Investment in
logistics, etc.

1.9

10 billion yen

billion yen

- yen

- yen

3.6

4 billion yen

- yen

- yen

- yen

Dividend

12 billion yen
Cashreserves/debt
4 billion yen

billion yen

Optimalcapital stock

Internal reserve

- yen

- yen

45

Policy for Improving Corporate Value in theMedium/Long Term (1)We aim to improve our corporate value by pursuing all of “earning capacity,” “yield ofcapital,” and “financial soundness.”
Key issues

Suppliers

Nations and local
communities

Establishment of atransparent governancesystem

SG&A
expenses - Other
SG&A expenses Personnel expenses

Interest

Taxes

Stakeholder satisfaction

Financial
institutions

Realization of a rewarding
workplace

Cost of sales

Addressing issues

Employees andtheir families

Stakeholders

Other business
partners

Net sales

Expansion green businessDigitization to maximize
customer value
Realization of sustainableprocurement and supply

ProfitShareholders
Shareholders’ equity

Reduced cost ofshareholders’ equity✓ Enhancement of engagement✓ Further stabilization of trading business✓ Reduction of business risks throughefforts to solve material issues

Increased growth rate

✓ Expansion of cash flows throughefforts to solve material issues

Boost sustainable growth potential by improving dialogue and reducing business risks

ROE maintained above the cost ofshareholders’ equity

Customers*Rise in equity spread×

Optimize
shareholders’equity✓ Credit rating with consideration
for trading business
R&I A-(stable) /JCR A(stable)✓ Shareholder return focused on
cash allocation

Capital and shareholder
returns policy46

Policy for Improving Corporate Value in theMedium/Long Term (2)It is assumed that the ratio of cost of shareholders’ equity will be around 7% and the average growth rateof basic operating cash flow until the final fiscal year of the medium-term management plan will be 3.82%*.
If ROE reaches 10% in FY3/25, business value will improve.
Market cap/basic operating cash flow

ROE/cost of shareholders’ equity
15(million yen)

18,000150,000

13.8

Cost ofshareholders’
株主資本コストequity13

自己資本
Shareholders' equity

ROE

Market cap
時価総額
Net income attributableto owners of parent
利益
Basic operating cash flow

120,000

10.9

16,00014,37813,0007.9

7.5
719,00090,0008.6

9

親会社株主に帰属する当期純

10.6

11

(million yen)

10,00060,000

8.0

7.5

7,000

7.3

6.9

5
19/3
FY3/1920/3
FY3/2021/3
FY3/21

22/3
FY3/22

6.4

6.4

23/3
FY3/23

FY3/24(forecast)24/3(予)30,0004,000

Shareholder return
Profit per share
１株当たり当期純利益

Dividend per share
１株当たり配当金

Dividend payout ratio (%)
連結配当性向（％）
45.00

140.0040.00

120.004.3
40.00

100.00

35.05

80.00
60.00

40.00
20.00
0.00

25.51
22.51

32.06

30.61

Dividend per share
１株当たり配当金

1,500.00

35.00

1,000.00

3.0

33.03

26.17
30.15 27.95

28.37

500.00

Dividend payout
純資産配当率（%）
ratio to net assets(%)

3.9 3.8 3.9

4.5

4.0

3.1
2.6

30.00

Net assets
１株当たり純資産
per share

2.9

3.0

3.0

3.2

1.9

25.00

3.5
3.0
2.5

2.0

24.92

15.00 15.00 20.00 30.00 30.00 32.50 36.00 30.00 20.00 35.00 40.00 45.00

20.00

0.00

1.5

47
*Starting from FY3/19, which saw the best performance before the outbreak of COVID-19.

[Note on forward-looking information]
This document contains plans and forecasts of the Company. Future plans, forecasts and other forward-looking statements are based on plans and forecasts based on currently available information. Actual results may differ
from these plans and forecasts due to various conditions and factors in the future,
This document is not a commitment or guarantee of their realization. All amounts are rounded down to the nearest million yen unless otherwise stated.

48

AGENDA
I. Outline and Our Business Models
II. Medium-Term Management Plan “CROSSING YAMAZEN 2024”
III. FY3/23 Financial Highlights
IV. Earnings Forecast for FY3/24
V. Shareholder Returns and Capital Policies
Appendix49

Recognition of the External Environment and Summarizationof Material Issues for Improving Corporate Value
To imagine future world views surrounding clients, and identify “issues to work on”
To consider that working on such issues means offering value to clients, which is a material issue for ourcompany
In order to invest financial and non-financial capital and then improve corporate value, we established“Sustainability Management Meeting,” which is a group-wide commission, on April 1, 2023.
YAMAZEN and the 2030 World
Outlook

Materiality (Key Issues)

Non-financial capital

Financial
capitalExpanding green business

4

5

Changes in consumer
behavior

Changes in the domestic andworld economy

Expanding governancerequirements(Environment)

Digitization to maximize customer
valueIntellectual capital(Information andknow-how)

Provision and marketing of optimal products andservices for meeting client needs based on IoT, data,etc. Provision of a digital environment to distributors
and labor-saving services

Realization of a rewarding
workplace
Improvement in the employment environment, enhancement oftraining and education, promotion of diversity, etc.

Human capital(People)Management of Fostering Personnel

Realization of sustainableprocurement and supply
Expansion of the market of YAMAZEN. Cementing ofrelationships with business partners, including local
suppliers. Response to geopolitical risks, economic
security issues, etc.

Establishment of a transparent
governance system
Improvement in corporate governance andtransparency. Enhancement of measures for meetingsocial needs from investors and others, including
compliance with laws and regulations

Manufacturing
capitalFinancial
capital3

Advance of digitalization andsmart technologies

Natural capital

Development and provision of energy-saving
machines, home appliances, etc. Business of houses
with net zero energy consumption and renewableenergy. Visualization of CO2 emissions fromequipment, green distribution, etc.

Input

2

Growing decarbonization
demandIdentification of material issues

1(Money)(Domestic andinternational network)

Social capital(Good relationships
with stakeholders)

50

ESG Initiatives for Sustainability (SDGs)

We will contribute to the continuous improvement insocial value as well as corporate value.
ESG

Theme

Measures

Declaration of reducing emissions to zero by

Stepwise energy saving at global bases, etc.

Related SDGs

2050
GREEN RECOVERY BUSINESSE
Cooperation with the supply chain in Scope-3

Power plant for generating power for ourbusiness: “To create environmental value by
ourselves!”
Campaign for selling environmentally-friendly
equipment
To support the reduction of GHG emissions in
the entire supply chain

S

Setting of a new HR principle “to develop
personnel who can take on challenges, ponder,
and take action”

Evolution from “the emphasis on roles andoutcomes” to “the emphasis on endeavors,
thinking, and actions”

Support for local communities, sports
promotion, and healthcare

Takeo Yamamoto Commemorative
Scholarship FundSponsoring Skill Olympic and Abilympics
Donation to and support for healthcare andrecuperation centers

Establishment of a transparent governancestructure

G

Disclosure of more financial and non-financial
information, and enhancement of dialogue
with the market
Strengthening of the corporate governancestructure51

Cooperation with the supply chain in Scope-3[Material issue: Expansion of green business]✓ We worked on the support for reduction of GHG emissions in the entire supply
chain in Scope 3.

Upstream Scope 3 (makers supplying products)

Promotion of distribution of energy-saving devices
and environmentally-friendly products

Support for reduction
Chain effect

Chain effectSupport for reduction

Downstream Scope 3 (distributors and users)

Solar power generation service
for private consumption

To provide enterprises participating in GBP witha CO2 emission calculation app free of charge
Visualization of emissions andreduction amounts

Schematic diagram of “visualization” with the GBP App

GHG Protocol＋

GBP Protocol
GBP reduction effect
Ｙ‐ＶＥＲ
YamazenVerified
Emission
Reduction±０
Total emissions

Reduction effect*Sum of Scopes 1,
2, and 3
emissions*Reduction effect ofenergy-saving
equipment

Scope 1

Scope 2 Scope 3

Reduction effect, too, was calculated to curtail “C:11 use.”52

Overview of the YAMAZEN Group

Home Products Division H.Q.

Building Materials Division H.Q.

Tool & Engineering Division H.Q.

Industrial Solution Division H.Q.

Machine Tools Division H.Q.

General Sales H.Q.

Domestic and international
networks

Sales composition*FY3/23

Other
1.0%
Improvement in group-wide profitability

7 Regional H.Q. in Japan
53 Business locations
8 Domestic subsidiaries

Home
Products
19.1%

Machine
Tools
28.7%

Building
Materials 527,263
million yen
12.9%

Domestic
production
equipment
48.7%
Overseas
Industrial Tools
production& Equipment
equipment
38.3%
18.3%

Osaka Regional H.Q.
Tokyo Regional H.Q.
Kitakanto/Tohoku Regional H.Q.

Personnel composition

Nagoya Regional H.Q.
Kyushu Regional H.Q.

Domestic
subsidiaries

Hiroshima Regional H.Q.
Total

Factory

Solution

Div.

H.Q.

10%

North America Regional H.Q.

4 Regional H.Q. overseas
16 Overseas subsidiaries
and 65 Businesslocations in 15
countries/regions

Taiwan Regional H.Q.
China Regional H.Q.
Asean Regional H.Q.
Directly under the jurisdiction of the
Head Office*As of the end of March 2023

Production Equipment

Consumer Goods

Overseassubsidiaries

37%

3,215
employees*As of the end of
March 2023
Including employeesof non-consolidated
affiliates

YAMAZEN only

53%
53