Asahi Kogyosha Co., Ltd.
(Securities Code: 1975)

Financial results briefing materials forthe fiscal year ended March 2024
May 31, 2024

Making comfort
a standard feature

Agenda1

Company overview

P.3

2

Overview of financial results for the fiscal year
ended march 2024

P.6

3

Performance forecast for the fiscal year ending
March 2025

P.15

4

Capital policy

P.19

5

Progress on the 18th Medium-term Management Plan

P.23

Appendix

P.28© ASAHI KOGYOSHA CO.,LTD.

2

1. Company overview© ASAHI KOGYOSHA CO.,LTD.

3

What Asahi Kogyosha is

An engineering company applying manufacturing capabilities
and technologies for air, water, and heatto create optimal and comfortable spaces and environments

MISSIONSPIRITPOLICYWe create optimal spatialenvironments and contributeto the development of humanculture through sophisticatedtechnology based on thesciences of air, water andheat, while taking good careof the earth’s environmentand our natural resources.

We, as engineering
constructors, actively strive
to develop our business.

[Company]© ASAHI KOGYOSHA CO.,LTD.

We endeavor to develop
technology with a constanteye toward the future,deftly responding to thechanging times.

Management with respect forhuman life and dignity[Workplace]
A workplace that isrewarding[Employees]
Employees who work to
improve themselves and arealways eager for a challenge
4Company information▎ Engaged in two businesses: Installation work and Manufacture and sale of equipment▎ Nationwide network in Japan▎ Overseas businesses (Taiwan and Malaysia)
Basic company information
Company name

Asahi Kogyosha Co., Ltd.

Date of establishment

April 1925

Representative

President and Representative Director
Yasutomo Takasu

Head office location

1-25-7 Hamamatsucho, Minato-ku, Tokyo

Business lines

The Installation Work Division plans,designs, and constructs air conditioning,water supply, drainage, sanitation, andother installations for various facilities in
the private and public sectors.
The Equipment Division develops, designs,
manufactures, and sells precisionenvironmental control equipment for thesemiconductor, flat panel display (FPD), andother leading edge industries.

Affiliates

Consolidated subsidiaries in Japan: onecompany
Asahi Hokkaido Cooling and Heating Co., Ltd.

Basic financial information*1
Net sales

91,676 million yen

Total assets

84,012 million yen

Number of employees

Net assets

987

ROE

38,756 million yen
10.02％Net sales by segment
Equipment Division

3,441 million yen
3.8%

Net sales

91,676

million yen
Installation
Work Division

Overseas consolidated subsidiaries: twocompanies (Taiwan and Malaysia)
Asia-Pacific Asahi Co., Ltd.
Asahi Engineering (Malaysia) Sdn.Bhd.

88,235 million yen
Note (1): FY 3/24, consolidated, actual© ASAHI KOGYOSHA CO.,LTD.

Ordinary income 4,896 million yen

96.2%

5

2. Overview of financial results for the fiscal year
ended march 2024

© ASAHI KOGYOSHA CO.,LTD.

6

Overview of financial results for the fiscal year ended march 2024
▎ Both orders and carryovers for the subsequent fiscal year grew thanks to orders for large-scale construction of healthand medical environment facilities and other factors.
▎ Net sales increased due to steady progress on a backlog of work orders in the Installation Work Division.

▎ Gross profit and other profits at each stage grew significantly due to growth in net sales and improved gross margins.
(Unit: million yen)

FY 3/22

FY 3/23

ActualActualOrders82,002Carryovers for the subsequent fiscal year

FY 3/24
Actual※1

YoY

Rate of change

86,77897,586

10,80712.5％

75,77382,38088,290

5,909

7.2％

Net sales

68,82080,171

91,676

11,505

14.4%

Gross profit

8,462

9,053

11,652

2,599

28.7%

Margin

12.3%

11.3%

12.7%

1.4pt

-

Selling, general, and administrative
expenses

6,175

6,355

7,084

728

11.5%

Operating income

2,287

2,697

4,568

1,870

69.3%

3.3%

3.4%

5.0%

1.6pt

-

308

429

328

(100)

(23.3%)

Ordinary income

2,596

3,127

4,896

1,769

56.6%

Margin

3.8%

3.9%

5.3%

1.4pt

-

267

640

236

(403)

(63.0％)

1,860

2,480

3,712

1,231

49.6%

2..7%

3.1%

4.0%

0.9pt

-

MarginNon-operating income/loss

Extraordinary income/loss
Profit attributable to owners of parent
Margin© ASAHI KOGYOSHA CO.,LTD.

7

Orders, net sales, and operating income by segment▎ Both orders and net sales grew significantly in the Installation Work Division. Operating income grewsignificantly due to growth in net sales.
▎ Both orders and net sales in the Equipment Division declined.

(Unit: million yen)

FY 3/22

FY 3/23

ActualActual

FY 3/24
ActualRate ofchangeYoY

Installation Work Division
Orders75,81082,093

93,161

11,068

13.5%

Net sales

63,295

75,11088,235

13,124

17.5%

Operating income

1,911

2,571

5,111

2,539

98.8%

Operating margin

3.0%

3.4%

5.8％

2.4pt

-

Orders

6,192

4,685

4,424

(260)

(5.6%)Net sales

5,525

5,060

3,441

(1,619)(32.0%)

Operating income

376

126

(542)

(669)

-

Operating margin

6.8%

2.5%

(15.8%)--

Total orders

82,002

86,77897,586

10,807

12.5%

Total net sales

68,82080,171

91,676

11,505

14.4%

Total operating income

2,287

2,697

4,568

1,870

69.3%

Equipment Division© ASAHI KOGYOSHA CO.,LTD.

8

Trends in quarterly results▎ Net sales increased in the fourth quarter despite fewer orders than in the third quarter.
▎ Profits at each stage also grew significantly due to an increase in net sales and an improvement in the grossmargin.
(Unit: million yen)

FY 3/23

FY 3/24

1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

Orders26,82627,54913,197

19,20424,32439,802

19,947

13,511

Net sales

13,482

17,90622,442

26,34019,21522,781

23,88425,795Gross profit

1,196

1,832

2,685

3,338

2,186

3,219

2,501

3,745

Margin

8.9%

10.2%

12.0%

12.7%

11.4%

14.1％

10.5%

14.5％

Selling, general, and administrative
expenses

1,553

1,420

1,407

1,974

1,615

1,578

1,834

2,056

Operating income

(356)

411

1,278

1,363

571

1,640

666

1,689

Margin

(2.6%)

2.3%

5.7%

5.2%

3.0%

7.2％

2.8%

6.6％

Non-operating income/loss

143

8

263

14

146

38

138

6

Ordinary income

(212)

419

1,541

1,378

717

1,678

804

1,696

Margin

(1.6%)

2.3％

6.9％

5.2％

3.7%

7.4％

3.4％

6.6％

52

(0)

(12)

601

(9)

17

(1)

229

(144)

251

1,045

1,329

468

1,147

527

1,569

(1.1%)

1.4％

4.7％

5.0％

2.4%

5.0％

2.2％

6.1％

Extraordinary income/loss
Profit attributable to owners of parent

Margin© ASAHI KOGYOSHA CO.,LTD.

9

Actual results by segment

Orders▎ Overall orders grew significantly from the previous year.

▎ Orders for production environment and living/cultural environment facilities decreased in the Installation Work Division, but orders fortransportation/communication environment, health/medical environment, and distribution environment facilities grew significantly.

▎ In the Equipment Division, products for semiconductor manufacturing equipment saw lower orders; however, orders grew for products for FPD
manufacturing equipment.
Orders(Unit: million yen)

FY 3/23

FY 3/24

Business environment facilities

20,624

11,58012,481901

7.8%Transportation/communication
environment facilities

1,113

834

5,012

4,178

501.0%

Living/cultural environment facilities

18,46815,05812,862(2,196)(14.6%)

Health/medical environment facilities

4,364

5,028

15,248

10,220203.3%

Distribution environment facilities

2,039

2,320

6,910

4,590

197.8%

Production environment facilities

29,201

47,27340,648(6,625)(14.0%)FPD (liquid crystal) -related

4,556

2,278

2,746

468

20.5%

Semiconductor-related

1,122

1,872

1,177

(695)

(37.1%)

514

535

501

(34)

(6.4%)

82,002

86,77897,586

10,807

12.5%

Installation Work

(Airport, train stations, TV stations, etc.)(Schools, hotels, etc.)(Hospitals, nursing homes, etc.)(Department stores, markets, etc.)(Factories/laboratories, data centers, etc.)

OthersTotal© ASAHI KOGYOSHA CO.,LTD.

YoY

Rate ofchangeFY 3/22(Office buildings, public office buildings, etc.)

Equipment
Manufacturing
and Sales

FY 3/22

FY 3/23

FY 3/24

Business
Living/culture
Distribution
FPD
Equipment and otherTransportation/communication
Health/medical
Production
Semiconductors

10Actual results by segment

Net sales▎ Overall sales grew significantly from the previous year.
▎ Sales to business environment and health/medical environment facilities in the Installation Work Division declined; however, sales toliving/cultural environment and production environment facilities grew significantly.
▎ In the Equipment Division, semiconductor-related sales remained about the same as last year, while FPD-related sales fell significantly due to theimpact of declining orders starting in the preceding fiscal year.

FY 3/22Net sales(Unit: million yen)

FY 3/22

FY 3/23

FY 3/24

YoY

Rate ofchangeBusiness environment facilities

15,123

16,30915,259(1,050)(6.4%)

Transportation/communication
environment facilities

1,522

1,048

1,364

316

30.2%

Living/cultural environment facilities

10,72913,59818,698

5,100

37.5%

Health/medical environment
facilities

9,583

7,906

5,595

(2,311)(29.2%)

Distribution environment facilities

2,323

3,164

4,190

1,026

32.4%

Production environment facilities

24,01533,085

43,12910,04430.4%

FPD (liquid crystal) -related

3,897

3,195

1,712

(1,483)(46.4%)

Semiconductor-related

1,090

1,422

1,413

(9)

(0.6%)

538

443

316

(127)

(28.7%)

68,82080,171

91,676

11,505

14.4%

Installation Work

(Office buildings, public office buildings, etc.)(Airport, train stations, TV stations, etc.)(Schools, hotels, etc.)(Hospitals, nursing homes, etc.)(Department stores, markets, etc.)

Equipment
Manufacturing
and Sales(Factories/laboratories, data centers, etc.)

OthersTotal© ASAHI KOGYOSHA CO.,LTD.

FY 3/23

FY 3/24

Business
Living/culture
Distribution
FPD
Equipment and otherTransportation/communication
Health/medical
Production
Semiconductors

11Carryovers for the subsequent fiscal year
▎ Overall carryovers for the subsequent fiscal year increased from the previous year.
▎ Carryovers for business environment, living/cultural environment, and production environment facilities declined;
however, carryovers for transportation/communication environment, health/medical environment, and distribution
environment facilities grew significantly.
FY 3/22
Carryovers for the subsequent fiscal year
(Unit: million yen)

FY 3/22

FY 3/23

FY 3/24

YoY

Rate ofchangeBusiness environment facilities

23,912

19,183

16,405(2,778)(14.5%)

Transportation/communication
environment facilities

759

545

4,193

3,648

669.4%

Living/cultural environment facilities

23,441

24,901

19,065(5,836)(23.4%)

Health/medical environment facilities

5,961

3,083

12,7369,653

313.1%

Distribution environment facilities

1,086

242

2,962

2,720

1,124.0%

Production environment facilities

15,67629,864

27,383(2,481)(8.3%)

Total

70,83577,81882,744

4,926

6.3%

(Office buildings, public office buildings, etc.)(Airport, train stations, TV stations, etc.)(Schools, hotels, etc.)(Hospitals, nursing homes, etc.)(Department stores, markets, etc.)(Factories/laboratories, data centers, etc.)

FY 3/23

FY 3/24

Business

Transportation/communication

Distribution

Production

Living/culture© ASAHI KOGYOSHA CO.,LTD.

Health/medical

12

Balance sheet▎ Total assets increased by 5,070 million yen from the end of the preceding fiscal year due to various factors, including
growth in accounts like cash and deposits, accounts receivable from completed construction contracts and electronicallyrecorded monetary claims.
▎ Total liabilities increased by 1,694 million yen from the end of the preceding fiscal year due to various factors, including
growth in accounts like income taxes payable and provision for loss on construction contracts.
▎ Net assets increased by 3,375 million yen from the end of the preceding fiscal year due to various factors, including
growth in accounts like retained earnings and valuation difference on available-for-sale securities.
(Unit: million yen)

FY 3/22

FY 3/23

FY 3/24

YoY

Rate of change

Current assets

52,13659,201

63,854

4,653

7.9%

Non-current assets

19,944

19,74020,157416

2.1%

Current liabilities

35,576

41,642

43,677

2,034

4.9%

Non-current liabilities

2,143

1,918

1,578

(340)

(17.7%)

Total liabilities

37,72043,56145,255

1,694

3.9%

Net assets

34,36035,38038,756

3,375

9.5%

Total Assets

72,081

78,94184,012

5,070

6.4%

1,339.15

1,376.70

1,506.49

129.799.4%

Shareholders’ equity ratio (%)

47.7

44.8

46.1

1.3pt

-

Interest-bearing debt

3,800

3,300

3,300

-

-

Net assets per share (yen)© ASAHI KOGYOSHA CO.,LTD.

13

Statement of cash flows▎ Cash flow from operating activities was positive by 2,010 million yen, due primarily to significant growth inprofit before income taxes.
▎ Cash flow from investing activities was negative by 304 million yen, due to purchase of property, plant andequipment, intangible assets, payments into time deposits and other factors.
▎ Cash flow from financing activities was negative by 1,293 million yen due to dividend payments and otherfactors.
▎ The balance of cash and cash equivalents was 17,979 million yen, an increase of 439 million yen from the same
period of the previous year.
(Unit: million yen)

FY 3/22

FY 3/23

FY 3/24

YoY

Cash flow from operating activities

4,648

(34)

2,010

2,045

Cash flow from investing activities

89

(481)

(304)

177

Cash flow from financing activities(1,297)(1,349)(1,293)55

Cash and cash equivalents at end of the fiscal year

19,39017,54017,979439© ASAHI KOGYOSHA CO.,LTD.

14

3. Performance forecast for the fiscal year ending
March 2025

© ASAHI KOGYOSHA CO.,LTD.

15

Forecast for the fiscal year ending March 2025
▎ The forecast for orders is conservative compared to actual orders in the preceding fiscal year in light of our construction
organization.
▎ Net sales are expected to increase modestly due to the abundance of carryovers and recovery in the Equipment Division.
▎ Profits at each stage are expected to decline due to the continuing high cost of materials and equipment, the rising costof labor, and other factors.

(Unit: million yen)

FY 3/22

FY 3/23

FY 3/24

ActualActualActual

FY 3/25
Forecast

Rate ofchangeYoY

Orders82,002

86,77897,58684,700(12,886)(13.2%)

Carryovers for the subsequent fiscal year

75,77382,38088,29080,490(7,800)(8.8%)Net sales

68,82080,171

91,67692,500824

0.9%Gross profit

8,462

9,053

11,652

11,000(652)(5.6%)

Margin

12.3%

11.3%

12.7%

11.9%

(0.8pt)-Operating income

2,287

2,697

4,568

3,600

(968)

(21.2%)

Margin

3.3%

3.4%

5.0%

3.9%

(1.1pt)-Ordinary income

2,596

3,127

4,896

3,800

(1,096)(22.4%)

Margin

3.8%

3.9%

5.3%

4.1%

(1.2pt)

-

1,860

2,480

3,712

3,100

(612)

(16.5%)

2.7%

3.1%

4.0%

3.4%

(0.6pt)-Profit attributable to owners of parent
Margin© ASAHI KOGYOSHA CO.,LTD.

16

Outlook by segment▎ In the Installation Work Division, the forecast for orders is conservative in consideration of the construction organization; however, steadyprogress is expected on the work order backlog and net sales are expected to generally remain flat.
▎ Buoyed by renewed activity in the semiconductor and FPD markets, driven in turn by growing demand for onboard AI and for data centers
associated with generative AI, the Equipment Division is expected to recover. Additionally, both orders and net sales are expected to increase
due to stronger sales of products for high-performance film manufacturing equipment incorporating dryer technologies and other products.

Trends in orders and net sales
Orders100,000

100,000

4,424

90,00080,000Net sales

4,685

90,0006,000

80,00070,00070,00060,00060,00050,00040,00082,093

3,441

6,000

88,23586,500FY 3/24'24/3期FY
3/25'25/3期(Forecast)
（予想）

5,060

50,00093,16178,70040,00030,00030,00020,00020,00010,00010,000075,1100FY
3/23'23/3期

FY 3/24'24/3期■ Installations
設備■ Equipment
機器© ASAHI KOGYOSHA CO.,LTD.

FY 3/25'25/3期(Forecast)
（予想）

FY
3/23
'23/3期■ Installations
設備■ Equipment
機器

17

Long-term performance trends (past 10 years)▎ Net sales have grown steadily following the Lehman Brothers collapse, with significant growth in the fiscal years ended
March 2019 and March 2020, due in part to the impact of demand related to the Olympics.
▎ Both net sales and operating income declined significantly in the fiscal year ended March 2021 due to Covid, but
remained positive and have grown steadily since, remaining at high levels in the fiscal year ending March 2025.

Net sales trend(Million yen)

120,000

80,00071,24372,904FY 3/15FY 3/16

79,72485,064

88,979FY 3/18

FY 3/19

103,964
70,43568,820FY 3/21FY 3/2280,171

91,67792,50040,0000FY 3/17

FY 3/20

FY 3/23

FY 3/24

FY 3/25(Forecast)

Operating income trends(Million yen)

6,000
5,000

3,722

4,000
3,000
2,000

3,833

2,842

4,568
3,307

3,661

1,603

3,600
2,235

2,287

FY 3/21FY 3/22

2,697

1,000
0

FY 3/15© ASAHI KOGYOSHA CO.,LTD.

FY 3/16

FY 3/17

FY 3/18

FY 3/19

FY 3/20

FY 3/23

FY 3/24

FY 3/25(Forecast)18

4. Capital policy© ASAHI KOGYOSHA CO.,LTD.

19

Promoting management keenly aware of the cost of capital▎ ROE for the fiscal year ended March 2024 exceeded 10% and remains above the Company's perceived cost ofshareholders' equity (6%-7%).
▎ Cross-shareholdings will be reduced during the 18th Medium-term Management Plan period (April 2023 to March 2026)
to improve capital efficiency, with a target level of 20%.

ROE trend

Status of reduction of cross-shareholdings

11.00%

10.02%

10.00%

40.0%

9.00%
8.00%

45.0%

7.64%

7.11%

7.00%
6.00%

5.66%

5.47%

5.00%
4.00%

35.0%

30.0%

25.0%

3.00%
2.00%

20.0%

1.00%
0.00%

FY 3/20
FY
3/21
FY
3/22
FY
3/23
FY
3/24
'20/3期'21/3期'22/3期'23/3期'24/3期Note (1): The area shaded in beige represents the range of movement of the cost ofshareholder equity (6%-7%).
© ASAHI KOGYOSHA CO.,LTD.

15.0%'21/3期
FY 3/21'22/3期FY
3/22'23/3期
FY
3/23'24/3期FY
3/24'25/3期
FY
3/25(Forecast)(予想)
Note (2): Shown above are net assets divided by investment securities.

'26/3期
FY
3/26(予想)(Forecast)20

Returns to shareholders▎ In the 18th Medium-term Management Plan (April 2023 to the end of March 2026), we set as targets maintaining an ordinary dividend of 40 yen
per share (80 yen per share on pre-stock split basis) and a consolidated dividend payout ratio of 40% or more.
▎ We implemented two stock splits, one each in 2022 and this year, to expand our investor base and to improve share liquidity.
▎ We plan to pay a 100th anniversary dividend of 10 yen per year (20 yen on pre-stock split basis) commemorating the 100th anniversary of
the Company's founding on April 3, 2025.

Trends in dividends and dividend payout ratios
Dividends per share(Yen)

Consolidated dividend payout ratio

(%)

80

70.00

60

60.00

60

60

50.00
40.00

40
33.75

33.75

30.00
20.00

70

31.2

32.6

31.25
34.4

25
35.1

30

50

49.8
41.4

41.6

40
30

41.3

20

10.00

10

0.00

0

FY 3/18

FY 3/19

FY 3/20

FY 3/21FY 3/22

FY 3/23

FY 3/24

FY 3/25(Forecast)

Note (1): The Company implemented two stock splits, one each on April 1, 2022 and April 1, 2024, both at a two for one ratio. The dividend for each fiscal year reflects the stock splits.
© ASAHI KOGYOSHA CO.,LTD.

21

Share price and trading value▎ Our stock price has risen significantly due to solid business performance and the continuing implementation of IR measures.
▎ Average daily trading value has improved significantly and continues to meet the criteria for maintaining our listing on the Prime
Market, which we initially failed to meet.

Trends in share price and trading volumes since the transition reference date
Transitionreference date
(2021/6/30)

Jan-Dec 2021

Jan-Dec 2022

Jan-Dec 2023

Jan-Apr 2024

Average share price (closing)

741 yen

786 yen869 yen

1,186 yen

1,581 yen

Average daily trading value

16.46 mil yen

20.06 mil yen

27.83 mil yen

31.47 mil yen

138.1 mil yen※1※1stock price for the transition reference date is the average of the three months immediately preceding. The trading value is the average of the immediately previous year.
Note (1): The average

Note (2): The Company implemented two stock splits, one each on April 1, 2022 and April 1, 2024, both at a two for one ratio. The stock price for each period has been converted to the corresponding
figure after the stock splits.
(Yen)

(Yen)

160,000,000

1,700

140,000,000

1,500

120,000,000

1,300

100,000,000

1,100

80,000,000
60,000,000

900

40,000,000

700

20,000,000500

0Transitionreference date
移行基準日

Jan-Dec 2021
2021年1～12月
Average daily trading value
平均売買代金© ASAHI KOGYOSHA CO.,LTD.

Jan-Dec 2022
2022年1～12月

Jan-Dec 2023
2023年1～12月

Jan-Apr 2024
2024年1～4月

Average share price平均株価22

5. Progress on the 18th Medium-termManagement Plan
© ASAHI KOGYOSHA CO.,LTD.

23

Overview of the18th Medium-term Management Plan
▎ Formulated as the final stage (plan period: April 2023 to March 2026) of the long-term vision ASAHI-VISION 100:
Taking on Challenge to Change Transformation▎ We aim to become an Only One entity that creates new value for society.

Basic policy
Looking ahead to the 100th anniversary in 2025 and beyond, we will work on
three strategies and on strengthening the two foundations that underpin them.

Businessstrategy

Human resource
strategyInnovation
strategyStrengthening profitability
and improving productivity

Practicing human capitalfocused management that fully
demonstrates the valueof human resources

Strengthening and promoting
R&D and taking on
the challenge of starting
new businesses

Strengthening the sustainability foundation
Strengthening the DX platform© ASAHI KOGYOSHA CO.,LTD.

24

Human resource strategy: investing in human capital▎ We believe people are our greatest asset and the source of our competitiveness. We recognize securing anddeveloping human resources as the most important issue.
▎ We will promote diversity and a work-life balance and develop human resources from a medium- to long-term
perspective.
Trends in new graduate salaries (university graduates)(Yen)

Initiatives for human capital-focused management1

290,000

 In FY2023, we made a one-time inflation-response payment averaging
100,000 yen to all employees in response to rising prices and raised
wages by an average of 7%.

270,000

 In FY2024, the starting salary for new graduates was uniformly increasedby 30,000 yen (university graduates: 250,000 yen → 280,000 yen). We
raised the wages of all employees by an average of 7%.

250,000

2

230,000

210,000

Creating comfortable working environments

 To promote the use of the post-childbirth paternity leave system,
regular wages are paid during childcare leave.
 The percentage of eligible employees taking post-childbirth paternity
leave has risen steadily from 31.8% in FY2022 to 40% in FY2023.

190,000

3

Reforming workstyles at construction sites
 To reduce the burden on on-site workers, we strengthened the CAD
room and pushed forward with “centralization support for working
drawings,” whereby working drawings of all branches are created at
the back office.

170,000

150,000

Revision of compensation structure

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

■ Asahi Kogyosha Source: WEB Rosei Jiho
東証プライム企業平均
朝日工業社 出典：WEB労政時報■ Average of TSE Prime companies

 Promoting the use of BIM in design, construction, and maintenanceprocesses

Note (1): “Average of TSE Prime companies” is the average of the companies listed on TSE’s Prime Market that responded to the survey by WEB Rosei Jiho.
© ASAHI KOGYOSHA CO.,LTD.

25

[Innovation Strategy]
Building the new Technical Research Institute 1/2▎ By the end of 2025, we plan to build a new technical research institute at a total project cost of approximately 6 billion yen in Tsukuba City,
Ibaraki Prefecture.

▎ We will push forward under the vision of “fostering disquisitive minds and intellectual curiosity and undertaking the challenge of creating nextgeneration environments and new businesses.”▎ We will build a research institute with high environmental performance under the concept of “a technology center where people free their
imagination to roam and thrive.”

Exterior image of the new Technical Research Institute© ASAHI KOGYOSHA CO.,LTD.

26

[Innovation Strategy]
Building the new Technical Research Institute 2/2▎ The institute will identify creative technologies for creating and conserving energy by incorporating proprietary technologies. Goals include
achieving ZEB and obtaining premium certifications from LEED, CASBEE, and other third-party organizations.
▎ In addition to achieving ZEB requirements in quantitative terms, we plan to deploy an air conditioning system that achieves comfort and actualenergy savings and creates a comfortable daily life.

New Technical Research Institute project system

PLAN

Tsukuba Base
Platform with high environmental performance

CONCEPT

DecarbonizationZEB
LEED
CASBEE-WO

Technology center where people free their
imagination to roam and thrive

Flexible

ComfortVISION

Foster a spirit of exploration and intellectual
curiosity and take on the challenge ofcreating next-generation environments
and new businesses

Homey

Feeling nature

DX
IoT
AI

An open space where the scientific principles of air,water and heat can be experienced

Natural lighting, natural ventilation© ASAHI KOGYOSHA CO.,LTD.

Renewable energy

27Appendix© ASAHI KOGYOSHA CO.,LTD.

28

Asahi Kogyosha’s strengths▎ Our core competences lie in technical capabilities cultivated since our founding in air conditioning, sanitation,
and water supply and drainage.
▎ Based on these core competences, we develop competitive advantages by operating as an integrated entity, inclose contact with our customers and based on our position as a company offering leading expertise.

Integrated project-based operations
 Comprehensive proposal capabilities that merge
technologies related to air, water, and heat

Asahi Kogyosha

Technological capabilities in handling air,water, and heat cultivated over 100 years
since our founding(core competences) Wealth of experience in air-conditioning installationand sanitation installation work Equipment Division with its expertise in air
conditioning technologies
 Advanced technical capabilities responding to market
trends© ASAHI KOGYOSHA CO.,LTD.

 Increasing value added through synergies with the
Equipment Division

Operations in close contact with customers
 Cycle of improving competitiveness driven by agrasp of customer needs Deep accumulation of customer needs throughtailor-made proposals
 Stable management achieved through acquisition ofmaintenance and renewal projects

Positioning as a company offering leading expertise High profile in both the air conditioning andsanitation work markets
 Conducting business in commercial channels close
to customers
29[Technological capabilities related to air, water, and heat cultivated over 100 years since our founding]

Advanced technological capabilities responsive to market trends▎ Technologies responding to various trends have been developed as demands for industrial construction rise with the development of domestic
production bases, etc.
▎ Accumulation of wide-ranging advanced technologies, such as environmentally-friendly energy-saving technologies and air conditioning
technologies for production facilities requiring specialist expertise.

▎ Proactive acquisition of intellectual property rights to individual technologies responding to market trends to secure competitive advantage.

Energy-saving technology (ZEB*1 air conditioning system)
Liquid-cooled air conditioning system
A system that removes heat generated in various parts of the room fromtheir sources. By flexibly supplying the necessary cold water to where it isneeded, the heat load of heat-generating equipment scattered in indoor air
conditioning can be treated locally, thus reducing temperature unevenness inrooms and saving energy.

Deodorization and VOC*2 countermeasures, air filtering,and sterilization technologies
Cartridge adsorptive deodorizer
A deodorizing device that adsorbs and removes VOCs and other odors inindoor environments using activated carbon. Cartridges enable rapid
replacement of activated carbon.

Low-temperature regeneration desiccant air conditioner

Oil mist collector

A desiccant air conditioning system that can accurately control
dehumidification as a latent heat treatment device in separate latent heat /sensible heat air conditioning. Primary energy consumption is minimized
through the use of low-temperature regeneration dehumidifiers and use ofsolar heat for regeneration heat.

To address odors, poor visibility, and slippery floors created by oil mist
generated by machine tools, an important issue from the perspective ofworkers’ health, productivity and safety, we’ve achieved a removal rateequivalent to medium performance (MERV13) using just a cleaning
regeneration filter, thereby achieving both performance and cost efficiency.

Note (1): Buildings that reduce net annual primary energy consumption within the building to zero whileachieving comfortable indoor environments

Plant-growing environment control technologies

Note (2): Volatile organic compounds

Number of patents addressing market trends(including patents pending)Multi-tier cultivation shelves
Multi-tier cultivation shelves in plant cultivation facilities require uniform
thermal and light environments. We have provided numerous solutions forhigh-quality, high-efficiency cultivation equipment. Multi-shelf cultivationequipment developed especially for laboratories features various functions,
including the capacity to switch between a wide variety of lighting fixtures
and to make shelf height adjustments.

Rice cultivation room
Rice is a promising plant as a raw material for various pharmaceuticals,
including oral cholera vaccines. Rice cultivation rooms are facilities in which
optimal conditions for stable year-round cultivation are explored bycontrolling temperature, humidity, light environment, air quality, and culture
media in an enclosed environment. This is the main agriculture-related
research facility at our institute.

© ASAHI KOGYOSHA CO.,LTD.

Energyconservationrelated

28

Plant cultivation
environment
control
technology-related

12

Deodorization/VOC
countermeasures, airfiltering andsterilization
technology-related

5130

[Integrated, project-based business operation]

Comprehensive proposal capabilities that merge technologies related to air, water, and heat
▎ We respond to corporate sustainability initiatives as an environment-creating company to develop domestic production bases amid
the continuing shift toward labor savings and higher quality.
▎ In response to increasingly sophisticated customer needs, we provide solutions drawing on a comprehensive proposal systemcomprising the installation work branches, Equipment Division, and our technical research institutes .

Core competencies addressing market trends

Comprehensive proposal system responding toincreasingly sophisticated customer needs

Manufacturing industries
Development of domestic
production bases, etc.

Shift to high-value-added
products

Labor saving (automation)

Sustainability measures

Installationwork
branches

Mutualcooperation

Core competence

Air

Water

Heat

Technical
Research
Institute

Also responding to sustainability initiatives
Air conditioning
installation work
© ASAHI KOGYOSHA CO.,LTD.

Sanitation
installation work

Headquarters(Head office)Equipment
Division

Sharing the knowhow of each group
Joint proposals of solutions to customer needs
31

[Operating in close contact with customers]

Virtuous cycle driven by grasp of customer needs▎ Operating in close contact with customers makes it possible to grasp diverse customer needs.
▎ We have established a virtuous cycle in which we leverage identified customer needs to develop technologies
and improve service quality to win more customers.

GraspingneedsNewcustomers

Proposalandcustomer’s
approval

Follow-up

Continuation,
importantcustomers

Installation
anddelivery© ASAHI KOGYOSHA CO.,LTD.

32

SDGs (1/4) Asahi Kogyosha Group’s Basic Policy on SDGs
▎ The Group's corporate philosophy is to contribute to the development of culture by creating optimal spaces, drawing on advanced technologies
based on the science of air, water, and heat while taking good care of the global environment and resources.
▎ Based on this philosophy and a full understanding of the spirit of the SDGs (Sustainable Development Goals), all officers and employees of theGroup will actively work on the following six priority issues and strive to realize a sustainable society.
Priority issues addressed by the Group

Related SDG goal

[Planet]Realizing a decarbonized society by preserving the global environment and protecting resources
We will strive to preserve the global environment and resources in all of our business activities and will contribute to the realization of a decarbonizedsociety.

[Prosperity]
Providing solutions that bring us closer to a sustainable society and ensuring quality, health/hygiene and safety
We will strive to provide solutions that bring us closer to a sustainable society and to ensure quality, health and safety by leveraging the energy
conservation and other environmental technologies cultivated over the years and strengthening research and development.

[People]Promoting work-life balance and diversity
We will promote work-life balance and diversity to secure and maintain a work environment where the human rights and health of all people involved inour business activities are respected and diverse human resources can fully demonstrate their abilities and feel rewarded.
Promoting workstyle reform and improving productivity using digital technologies
We will promote workstyle reforms in all business processes and will strive to improve productivity by actively introducing and using digital technologies.
[Partnership]
Coexistence and co-prosperity with business partners and strengthening partnerships
We will strive to exist and prosper side by side with our affiliates (business partners) through fair, transparent, and appropriate transactions.
Additionally, we will work to realize a sustainable society by strengthening partnerships with external organizations with joint efforts involving industry,
academia, and government in mind.
[Peace]Enhancing corporate governance and strengthening compliance
We will work to enhance corporate governance to meet the expectations of various stakeholders. We will comply with domestic and international laws
and regulations through a comprehensive approach to management that emphasizes compliance.
© ASAHI KOGYOSHA CO.,LTD.

33

SDGs (2/4)
Themes of initiatives related to SDGs and specific measures in FY 2024
Priority issues addressed by
the Group

Related SDG goal

Initiative theme

Specific measures
Reducing energy consumption at business sites[Planet]Realizing a decarbonized society bypreserving the global environment
and protecting resources

Reducing environmental impact
through environmental
management systems

Recycling recovered fluorocarbons
Ensuring the appropriate disposal of industrial waste

Strengthening management torealize a decarbonized society

Enhancing information disclosure
Grasping greenhouse gas emissions volume moreaccurately and reducing greenhouse gas emissions
Presenting facility management proposals to customers

Providing solutions that bring us
closer to a sustainable society

Implementing visualization of CO2 emissions reductions
in energy-saving proposals
Reducing CO2 emissions in business activities[Prosperity]
Providing solutions that bring us
closer to a sustainable society andensuring quality, health/hygiene andsafety.

Researching the cultivation environment required for
the MucoRice rice-type vaccine
Strengthening R&D

Improving proprietary ZEB air conditioning systems,
mainly liquid-cooled air conditioning systems andseparate latent heat/sensible heat air conditioning
Developing R&D infrastructure

Ensuring quality, health/hygiene
and safety© ASAHI KOGYOSHA CO.,LTD.

Preventing problems and complaints; information
sharing
Promoting quality management and hygiene and safety
management
34

SDGs (3/4)
Themes of initiatives related to SDGs and specific measures in FY 2024
Priority issues addressed by
the Group

Related SDG goal

Initiative theme

Specific measures
Reducing statutory overtime hours

Promoting work-life balance

Encouraging employees to take paid leave
Encouraging employees to take childcare leave
Recruiting female career-track employees
Appointing female managers[People]Promoting work-life balance anddiversity

Promoting diversity

Securing employment for persons with disabilities
Promoting active participation of employees reemployed after retirement age

Promoting workstyle reforms andimproving productivity using digitaltechnologies

Addressing cap on statutory overtime work
Workstyle reform
Further promoting the Asahi Sun
Employee Project• Promoting operational efficiency and leveling workload• Strengthening management of work hours
Creating a healthy and rewarding work environment

Improving productivity via digitaltechnologies© ASAHI KOGYOSHA CO.,LTD.

Introducing digital tools in construction work
Improving business operations by promoting DX(streamlining and efficiency improvements)

35

SDGs (4/4)
Themes of initiatives related to SDGs and specific measures in FY 2024
Priority issues addressed by
the Group[Partnership]
Coexistence and co-prosperity withbusiness partners
Strengthening Partnerships

Related SDG goal

Initiative theme

Strengthening cooperation with
suppliers and eradicating
occupational accidents
Strengthening hygiene andsafety activities
Strengthening partnerships withexternal organizations

Continuing to make companylevel social contributions

Specific measures
Strengthening relationships with partner companies tomaintain appropriate relationships and to ensure quality
and safety
Assuring fair transactions with partner companies while
enhancing incentives
Participating in domestic and international SDG
initiatives and consortiums
Maintaining company-level social contributions
Maintaining branch-level contributions to local
communities
Continuously strengthening corporate governancesystems
Studying operational reliability and streamlining andsimplifying internal control systems

Enhancing corporate governance[Peace]Enhancing corporate governance andstrengthening compliance

Promoting public relations and IR
Enhancing dialogue with investors
Achieving further penetration of BCP

Disseminating effective
compliance© ASAHI KOGYOSHA CO.,LTD.

Ensuring and strengthening compliance
Ensuring effectiveness of whistleblowing system

36

Installation Work Division: business content and domains▎ The Installation Work Division performs air-conditioning installation and sanitation installation work using air, water, and heat technologies andprovides one-stop engineering for customer facilities, from planning and proposal to construction, maintenance, and renovation.
▎ As an illustration of recent achievements, production environment facilities centered on semiconductor factories, laboratories, pharmaceuticalfactories, food factories and automotive battery factories, which require a high technological level, account for approximately 49% of net sales.

Business areas

Business domains

Air conditioning and sanitation installation work
Air conditioning and ventilation installations

The basics of creating a space involve creating optimal air environments. We maintainhealth and create comfortable workspaces by controlling airflow and pollutants, inaddition to temperature and humidity. We control manufacturing and storage
environments, which vary depending on the air conditioning equipment, with highaccuracy.

Factory piping, drying, and dust removal installations

Manufacturing sites require building equipment that meets specifications quite different
from building equipment intended for ordinary human environments. Certain
technologies of applications may require technologies capable of supplying pure waterand liquid chemicals free of impurities in the specified amounts and in real time withoutchanging their qualities by eliminating the influence of the surrounding environment.

Water supply and drainage, sanitation, fire extinguishing installations

Water is essential to life, commercial, and industrial activities. We condition thetemperature and composition of water for the intended application and appropriately
treat and discharge dirty water after use.
Protecting people and buildings from fire is another key mission related to building
equipment.

Cleanroom installations
In hospitals, pharmaceuticals, and semiconductor factories, which require clean spaces,
eliminating fine dust, chemical and biological contamination such as polluting gases
and viruses is critical. We create clean spaces while allowing control to achieve optimal
thermal environments.

Planning & proposal

Design, estimation

Construction

Total engineering
Post-installation
maintenance© ASAHI KOGYOSHA CO.,LTD.

DeliveryTransportation andcommunication environment
facilities 1.5%

Distribution environment
facilities 4.7％
Shopping malls, department stores,
underground commercial facilities,
markets, etc.

Airports, train stations,
TV stations, etc.

Health and medical environment
facilities 6.3%

Production environment
facilities 48.9%

Hospitals, nursing homes,
etc.

Business environment
facilities 17.3%
Office buildings,
government buildings, etc.

Composition of
net sales bybusiness domain

Factories, laboratories,
data centers, etc.

(FY 3/2024)

Living and culturalenvironment facilities 21.2%
Schools, hotels, gymnasiums,
concert halls, etc.

Adjustment/testing37

Equipment Division▎ We develop, manufacture, and sell precision environmental control equipment to leading-edge industries, including manufacturing equipment for
semiconductors, FPDs, and electronics.
▎ By supplying primarily on an OEM-basis, we have focused on development, design, and manufacturing, accumulating advanced technologicalcapabilities in air-filtering technology and thermal fluid control technology.
▎ We contribute to the Group's comprehensive strength by manufacturing air conditioning-related devices in collaboration with the Installation
Work Division.

Main Products

Business overview

 Manufacture of high-performance temperature and humidity control
equipment and their sale either independently or in combination withchambers (environmental chambers); manufacture and sale ofenvironmental control devices for FPD/semiconductor manufacturing
equipment installed in cleanrooms Products are mainly supplied on an OEM basis. Over 10,000 units
have been shipped cumulatively over the more than 30 years since
the Company’s founding.
 Sales areas include China, South Korea, Taiwan, the United States,
and Germany.

Trends in composition of sales by productEnvironmental chamberHigh efficiency sensible
heat air conditioning
equipment

Crystal jet

Dryer technology(％)
FPD-related

8.9

13.9

Semiconductor-related

Others

9.7

8.8

18.5

15.0

19.7

28.1

72.6

71.1

70.5

63.1

FY 3/20

FY 3/21© ASAHI KOGYOSHA CO.,LTD.

FY 3/22

FY 3/23

9.2
41.1

49.8

FY 3/24
38

This document contains forward-looking statements regarding industry trends and the activities undertaken by Asahi
Kogyosha based on current plans, estimates, expectations, and forecasts.
Various risks and uncertainties are inherent in these forward-looking statements.
Risks, uncertainties and other factors known or not yet known could cause results to differ from those contained in theseforward-looking statements.
The future nature of the business undertaken by and the performance and other characteristics of Asahi Kogyosha may
diverge from the forward-looking statements presented herein.
The forward-looking statements herein are based on information available as of May 31, 2024. Note that Asahi Kogyosha
may not necessarily update or revise the forward-looking statements to reflect emerging events or circumstances.

Asahi Kogyosha Co., Ltd.
(Securities Code: 1975)

Inquiries
Public Relations & Investor Relations Office, Asahi
Kogyosha Co., Ltd.,
Telephone : 03-6452-8181
Facsimile : 03-6452-8191