Discontinuation of Production at a
Consolidated Subsidiary andRevisions to the Full-Year Forecast ofFinancial Results for the Fiscal YearEnding March 31, 2024

February 13, 2024

 Causes of discontinuation of production at Nitta Gelatin USA, Inc. (NGU)
Surging energy and personnel costs, etc.
Externalfactors• Sudden increase in manufacturing costs caused by economic
growth in USA and COVID-19

Rapid worsening in market conditions in North America• In addition to a decline in demand caused by inflation, gelatin prices
fell due to the influx of cheap bovine hide gelatin from SouthAmerica.

Internalfactors

Deteriorating productivity• In addition to aging equipment, the high turnover rate has stood in
the way of local staff becoming proficient, resulting in intermittent
equipment malfunctions.

As it will be difficult for NGU to securestable earnings in the future, Nitta
Gelatin has determined that streamlining
its North American business andconcentrating resources on areas offuture growth will contribute toincreasing the corporate value of theGroup as a whole.

 Future supply and sales systems
 In the North American market, sales of porcine gelatin produced at NGU will be discontinued as soon as
the contract ends, but bovine bone gelatin, etc. will continue to be sold.
 In the Japan and Asian markets, sales will continue as before, although some production bases willchange.
Supplemental material on revisions to the Full-Year Forecast of Financial Results for FY2024 (February 13, 2024)2

(Millions of yen)

1Q

2Q

3Q
cumulative

3Q

Operating income

(157)

(268)

(766)

(1,191)

Ordinary income

(176)

(290)

(812)

(1,279)Extraordinary loss--

1,762

1,762

(176)

(290)

(2,655)(3,122)Net loss

Quarterly trend in operating income
0-200-400-600-800-1,000(Millions of yen)

(Millions of yen)

1Q

2Q

3Q

Operating income

489

854

197

1,541

Ordinary income

741

997

(27)

1,712

Extraordinary loss

026

1,762

1,789

248

442

(2,300)(1,610)Net income attributableto owners of the parent

Quarterly trend in operating income

3Q cumulative(Millions of yen)

1,000
1Q

2Q

3Q
500
01Q

NGU’s operating income

 Despite efforts to improve productivity by dispatching technicalstaff from Japan, operating losses increased with each quarter.
 As the rise in raw material prices peaked in the third quarter, theextent of these losses widened sharply. Determined that
production must be discontinued to improve financial results fromthe next fiscal year onwards.

2Q

3Q

Consolidated operating income

 Consolidated operating income worsened due to the impact of therapid increase in NGU’s operating loss in the third quarter.

 Recorded an extraordinary loss (impairment loss on noncurrent
assets) associated with the decision to discontinue production atNGU totaling approximately ¥1.7 billion in the third quarter.

Supplemental material on revisions to the Full-Year Forecast of Financial Results for FY2024 (February 13, 2024)3 Revised full-year forecast of consolidated financial results for FY2024(Millions of yen)

FY2024FY2023

Previous forecast(May 2023)

Current forecast(February 2024)

ChangeNet sales

40,00040,000－39,186813

Operating income

2,100

1,700(400)

2,259(559)

Ordinary income

2,100

1,700(400)2,248(548)

Net income attributable toowners of the parent

1,200(2,400)(3,600)1,558(3,958)

Cash dividends per share(yen)*16.016.0ー

16.0ー

Results

Difference* Includes the ¥8 interim dividend already paid.

 Net sales: Expected to maintain pace through the third quarter and achieve initial forecast
 Operating income and ordinary income: Deterioration in NGU’s productivity will affect the operating income of the entire Group(full-year impact is expected to be approximately −¥1.7 billion)
 Net income attributable to owners of the parent: Plan to record an extraordinary loss associated with the decision to discontinue
production at NGU(3Q: Impairment loss on noncurrent assets; 4Q: Loss on liquidation of business,including special retirement expenses and costs for the removal of production facilities)
 Annual dividend forecast: Unchanged from the previous forecast (year-end dividend forecast ¥8; full-year dividend forecast ¥16)
Supplemental material on revisions to the Full-Year Forecast of Financial Results for FY2024 (February 13, 2024)

4

Note:The opinions, outlooks, and forecasts contained in this document are based on the judgment of Nitta Gelatin at thetime of the preparation of the material.
The Company does not guarantee the accuracy of this information. Due to various factors such as the market
environment, future results may vary from those in this document. Thank you for your understanding.

Supplemental material on revisions to the Full-Year Forecast of Financial Results for FY2024 (February 13, 2024)5