Results of Operations for theFirst Half of the Fiscal YearEnding March 31, 2024
Tokushu Tokai Paper Co., Ltd. (TSE Prime, 3708)

Financial Information

Consolidated Financial Summary

Higher sales and ordinary income due to price revisions(Millions of yen)

1H FY3/23

1H FY3/24

YoYNet sales

42,071

42,615

+544

+1.3%

Operating income

1,337783-554-41.4%

Ordinary income

2,549

2,949

+400

+15.7%

Profit attributable toowners of parent

3,150

2,328-822-26.1%

3

Segment Information

Focus on the environment related business in order to expand to new business domains

1H FY3/23(Millions of yen)
Industrial Materials
BusinessSpecialty Materials
Business

Household Products
Business

Environment Related
Business

Elimination/adjustment

1H FY3/24

YoY

Net sales

21,846

21,372-474

Operating income

520

521+1

Net sales

10,543

10,342-201

Operating income

718

(71)

-789

Net sales

8,576

9,022+446

Operating income

61258+197

Net sales

3,995

5,290+1,295

Operating income

(34)

23+57

Net sales(2,890)(3,412)-522

7351-22Net sales

42,071

42,615+544

Operating income

1,337

783-554

Operating incomeTotal4

Components of Change in First Half Earnings

Price revisions were implemented, but operating income decreased due to sluggish sales volume.
Ordinary income increased because of equity-method income.

(Millions of yen)

Non-operating income/expenses

+885

2,549

2,949

1,337
783
Sales

Materials+1,828-1,941

Factory efficiency Fixed cost, etc.

+24-124

Inventories

Others

-115

-226

5

FY3/24 Forecasts

No change from the initial forecasts(Millions of yen)

FY3/23

FY3/24 forecasts

YoY

Net sales

84,13090,000+5,870+7.0%Operating income1,640

3,000+1,360+82.9%

Ordinary income

4,058

6,000+1,942+47.9%

Profit attributable toowners of parent

4,130

4,000-130-3.1%

6Components of Change in FY3/24 Earnings

Forecast fiscal year sales and earnings growth as the full fiscal-year contribution of price revisions offsets
slow sales volume growth(Millions of yen)
Non-operating income/expenses

+592

6,000

4,058

3,000
1,640
Sales

Materials+3,600-1,800

Factory efficiency Fixed cost, etc.
-10-550

Inventories

Others-40+160
7Business Strategies

Medium/Long-term Strategies of the Tokushu Tokai Paper Group
Since its inception, TTP has contributed tosociety and protecting the environment by
converting many materials to paper andbiomass products

Expertise for use ofwood resources

Papermaking/processing
technologies
Quality assurance expertise

Long-term goals

Biomass energy

Know-how about recycling

Future business portfolio

Large TTP forests

Valuable assets created by core businesses

Growth backed
by bothbusinesses
Growth of thePaper BusinessRealign theproductportfolio

Create newsatellitebusinesses

Environment
Related Business
Advancement of therecycling
business

Current business portfolio

Needs of customers and society

Supply chain management

 Contributions fordecarbonization
 Value as source of naturalcapital Effective use of resources
 Helping reduce the use of plastic
 Products/services that
accurately meet specific needs

Coexisting withcommunities/society¥1.6 billion

Climate change

Value for society
Coexisting with the environment

Effective
use of TTPforests

Operating income

Social issues

Environment
RelatedBusiness
Operating income¥10.0 billion

Paper
Business

Biodiversity

Resource recycling

Use of digital technologies

Health and safety

 Support for cultural activities Safety and health Utilization of a diverse
workforce
 Improve productivity

Seven components of materiality at TTP
Corporate governance and human resources strategies
Business philosophy

Unique paper maker with high uniqueness and originality

9Growth of thePaper BusinessRealign theproductportfolio

Create newsatellite
businesses

Background of Business Strategy

Significant changes in the paper/pulp industry due to digital technologies

Conversion of products to paper/biomass since TTP’s inception
Increasing use of digital technologies
Firm demand for paper as an industrial
material and in household products butsoft demand for specialty materials
Issue

Declining demand for paper as an information communication medium

Response

Shift from products with declining demand to products with growth potential

11Growth of the Paper BusinessIn the paper business, realign the product portfolio and create new satellite businesses

Realign the product portfolio

Create new satellite businesses
New customer needs due to the growing
public interest in protecting the environment

Products affected by digital technologies
Bank books

MICR paper

OCR paper

Pressure seal
postcard paper

Fancy paper (forpublications)

Satellite businesses originating from papermaking skills

New environmentallyresponsible products

New products with strong
demand despite use ofdigital technologies

TOKYOTM

New germ-resistant paper

Forest certified products

Fluorine-free oil-resistant paper

FiblicPackage

Aramid Paper

12Realign the Product Portfolio

Higher profitability by consolidating manufacturing, realigning the product portfolio and revising prices

Streamline the product portfolio

Gifu Mill

Shift of some operations

 Production capacity is about 19 tons/day
Most output is colored fancy paper Studies to determine products to continue
making and stop making while preparing
for the shift of some operations to Mishima

Mishima Mill

 Consolidation of fancy paper production is
expected to make more efficient use ofassets and lower fixed expenses

Price revisions
 Price revisions resulting fromcontinuous negotiations withcustomers were implemented in
the first quarter

13

Create New Satellite Businesses

New ideas and sales activities for sheet+3D molded products in the package business

Demands of end users

Trade fairs

Create sales
opportunities

New products
Second group of generalpurpose products

Example of applications

 Silky mold cocoon
EC sales started in June 2023

216 interactions
with end users
in 1H FY3/24

 Features a soft texture that issmooth and like a cocoon
Package for “ink mazeru”(ink with an original blend) atIsetan
Shinjuku Department Store■(Sakai Co., Ltd.)

14

Create New Satellite Businesses

R&D and market development using customer perspectives to create paper satellite businesses

I want a smaller foodtray to reduce thevolume of trash.

I want a paper
remote control case,but can it be strong
enough?

I want to reduce theamount of oil-basedmaterials inpackaging.

Wishes of end usersSolve problems = Constantly create new satellite businesses

TTP technologies and knowledge not yet used to make products

15

Environment
Related Business
Advancementof therecycling
business

Effective
use of TTPforests

Environment Related Business

Paper and the addition of new business domains will both be essential for growth

Environment Related Business Goals

Fourth Medium-term Plan

Fifth Medium-term Plan

Sixth Medium-term Plan

Make this business a reportablesegment

Addition of Suruga Service K.K. to the TTP Group

Addition of Toei Co., Ltd. to theTTP Group

Start of the whisky businessNew business domains due to constantly taking on new challenges = Environment Related Business

Use corporate resources originating from papermaking to target needs associated with the ongoing transition

to a society where resources are recycled and reused17

Advancement of the Recycling Business

More growth of the key thermal recycling business backed by a higher production capacity

Relocation of the REX Kanaya Mill for higher RPF output

Higher capacity for collection of waste plastics

Improve productivity by revising the work schedule

2003

Kanaya Mill2005

Shimada Mill2012

Numazu MillThermal materials
Suruga Service K. K.

Increase from 2 to 3 shifts = Higher productivity
Relocation
2020

Nagaizumi Mill

2025

Makinohara Mill

Thermal materials

Toei Co., Ltd.

18

Advancement of the Recycling Business

Acquired Suruga Service and Toei for growth of the recycling business(2023)(2020)

Industrial resources and waste plastics
Intermediate processing(Sorting, pulverizing, etc.)

Reuse as resources

Glass

Home appliances

Disassembly

Conversion to Sand Wave G,
a recycled granular glass sandproduct that is permeable towater and helps prevent thegrowth of weeds

Colored glass
CRT TVs, flat-panel TVs

Reuse as resources

Small size home appliancesthat usually goes to a landfill

Gravestones

Sorting/classification

Mobile phones

Recovery of metals

Gravestones and other stones

Crushed stones forhighway construction
and other applications

19

Advancement of the Recycling BusinessToei operates many businesses with close ties to communities other than recycling.

Aircraft business

Water infrastructure maintenance businessSolar power generation business

Advanced skills involving sealing,a process that cannot be
automated

Increasing demand formaintenance services for aging
sewer systems

Solar power facilities near TTPGroup business sites

 Provision of specialists to factories

 Repairs to sewer lines andcleaning/inspections of septic tanks

 Total output is currently about 2megawatts

 Sealing of fuel tanks for connectionof the front and rear fuselage
sections

 All electricity is sold to external users

20Advancement of the Recycling Business

Newly acquired Toei will contribute to sales growth and is expected to become another profit center for
the TTP Group

Goal is to become acomprehensive
recycling company

21

Effective Use of TTP Forests

Make the value of the Ikawa Forest accessible to the public

Value as a wildlife habitat

Value for the absorption and fixationof CO2

 The Ikawa Forest has been certified by the Japanese Ministry of
the Environment as a Nature Coexistence Site, which is alocation where private-sector and other activities are used topreserve biodiversity.

 Work is under way to determine theamount of CO2 absorbed by the Ikawa
Forest that can be certified based on
the forest J-Credit Scheme in FY3/24.

The certification ceremony

22Effective Use of TTP Forests

Production of whisky by using the natural resources of the forest

As whisky distilling operations enter the third year in 2024, preparations are moving forward for the full-scale start of whisky sales

Branding
 Three types of newborn whisky were sold in 2023
The primary goal was to raise awareness of this whisky at bars
in Tokyo and Shizuoka

Expansion of the distillery
 Preparing to enlarge the aging warehouseas production operations continue asplanned23

Our vision for the TTP Group

Business portfolio realignment and innovation to become a corporate group with an even greatercommitment to sustainability

Business portfolio realignment
and innovation

New business domain

Environment Related BusinessNowPaperBusiness

Operating income¥1.6 billion

Activities that go beyond current paper operations

The future Environment
Operating income

RelatedBusiness¥10.0 billion

Growth of the Paper Business

Environmental
expertise

Low-carbon

CO₂ performance

Large TTP forests

Recycling technologies

More corporate value
for a sustainable society24Sixth Medium-term Management Plan

Selections, challenges and innovations as the midway point to accomplishing long-term goals

Selections

Selections for assembling a business portfolio to achieve our vision

Challenges

Taking on challenges for more growth in the environmental andpaper businessesOperating income

Innovations

5.0 billion¥Ordinary income

ROE

8.0 billion

7.0%

¥25

Actions for Growth of Corporate Value
Since its inception, TTP has contributed tosociety and protecting the environment byconverting many materials to paper andbiomass products

Expertise for use ofwood resources

Papermaking/processing
technologies
Quality assurance expertise

Long-term goals

Biomass energy

Know-how about recycling

Future business portfolio

Large TTP forests

Valuable assets created by core businesses

Growth backedby bothbusinesses
Growth of thePaper BusinessRealign theproductportfolioCreate newsatellitebusinesses

Environment
Related Business
Advancement of therecycling
business

Current business portfolio

Needs of customers and society

Supply chain management

 Contributions fordecarbonization
 Value as source of naturalcapital Effective use of resources
 Helping reduce the use of plastic
 Products/services that
accurately meet specific needs

Coexisting with
communities/society¥1.6 billion

Climate change

Value for society
Coexisting with the environment

Effective
use of TTP
forests

Operating income

Social issues

Environment
RelatedBusiness
Operating income¥10.0 billion

PaperBusiness

Biodiversity

Resource recycling

Use of digital technologies

Health and safety

 Support for cultural activities Safety and health Utilization of a diverseworkforce
 Improve productivity

Seven components of materiality at TTP
Corporate governance and human resources strategies
Business philosophy

Unique paper maker with high uniqueness and originality

26

Inquiries:
TEKKO BUILDING 11F, 1-8-2 Marunouchi,
Chiyoda-ku, Tokyo
Tel: +81-3-5219-1816* Plans, actions and other statements in this presentation are based on management decisions using information that wasavailable as of the date of this presentation. As these statements include numerous risk factors and other uncertainties, actual
results of operations may differ from the information in this presentation.