FREUND CORPORATION(Securities code: 6312)

Results of Operations for the Fiscal
Year Ended February 28, 2022
April 27, 2022

Copyright(C) 2022 Freund Corp. All rights reserved.

Contents
 Consolidated Financial Summary for FY2/22

・・・

P.02

 Consolidated Earnings and Dividend Forecasts for FY2/23

・・・

P.16

 Medium‐term Management Plan

・・・

P.20

Supplementary Materials

・・・

P.25

Factsheet・・・

Appendix

Copyright (C) 2022 Freund Corp. All rights reserved.

1

Consolidated Financial Summary for FY2/22

Copyright(C) 2022 Freund Corp. All rights reserved.

Consolidated Financial Summary
 Sales increased and earnings decreased YoY.


Domestic sales were favorable, but performance was severely impacted by shipment delays due tocomponent procurement difficulties at overseas subsidiaries.
Although profit declined in nominal terms, operating profit and ordinary profit in real terms were higher thanin the previous year after adjusting the previous year’s one-time gain at the U.S. subsidiary of approx. 300
million yen (subsidy of approx. 200 million yen and insurance income of approx. 100 million yen).
Big profit decline due to an extraordinary loss of approx. 200 million yen.
(Millions of yen)

FY2/21

YoY change

FY2/22

Forecast％

AmountNet sales

16,765

17,632

+866

+5.2%

18,500Operating profit

1,111

981

(129)

(11.6)%

1,100

Ordinary profit

1,308

1,032

(275)

(21.1)%

1,130

970

543

(427)

(44.0)%

790

Earnings per share (yen)

57.96

32.46

(25.50)-47.18

Orders received

12,386

15,621+3,234+26.1%-

Order backlog

6,615

10,574+3,958+59.8%-

Capital investment

637

571

(65)

(10.3)%-

Depreciation

461

570

+108

+23.5%-

R&D expenses

526

580

+53

+10.2%

-

ROA

4.7%

2.4%

-

-

-

ROE

7.2%

3.9%

-

-

-

ProfitCopyright (C) 2022 Freund Corp. All rights reserved.

3

Machinery Business: Overview
 Net SalesNet sales increased due to the full-year contribution of Cos.Mec (only Q4 results wereconsolidated in the previous fiscal year).
Domestic sales were favorable. Overseas sales were severely impacted by tight supplies
of components.

 Operating ProfitOperating profit declined due to sluggish performance of overseas subsidiaries.

 Orders Received/Order Backlog


Orders at overseas subsidiaries are strong. There is demand for major capital
investments in the generic drug industry in Japan.
Record high consolidated order backlog (FY2/22 consolidated orders received were thesecond highest ever).

(Millions of yen)

Net sales
Operating profit
Orders received
Order backlog

FY2/21
AmountYoY change (%)+0.5
11,171+236.81,047+21.1
12,386+40.9
6,615

FY2/22
AmountYoY change (%)+6.0
11,836(40.5)
623+26.1
15,621+59.8
10,574

Copyright (C) 2022 Freund Corp. All rights reserved.

4

Machinery Business: Group Company Performance (Sales/Operating Profit) Freund Corporation: Net sales and operating profit remain on a par with the previous fiscal year
despite some projects being delayed to the next fiscal year.
 Freund-Vector:

Sales declined due mainly to shipment delays caused by tight supplies ofcomponents.
Profit also fell sharply due to the absence of special factors (subsidy) that
contributed to earnings in the previous fiscal year.

 Freund-Turbo:

Net sales and profit increased due to an upturn in demand for industrial
machinery.

 Cos.Mec:

Weak due to the impact of the pandemic in emerging countries, the primarymarket for this company.

(Millions of yen)

FY2/21
AmountYoY change (%)

FY2/22
AmountYoY change (%)

11,171+0.5

11,836+6.0

FREUND CORPORATION

6,838

+9.3

6,865

+0.4

FREUND-VECTOR

3,591(10.1)

3,135(12.7)

FREUND-TURBO

1,422

(6.6)

1,529

+7.5

Cos.Mec

382

ー

937

＋145.3Operating profit

1,047+236.8623(40.5)

FREUND CORPORATION

737+139.4752+2.0

FREUND-VECTOR

283

ー

(50)

ー

FREUND-TURBO

26(53.3)

83＋217.4

Cos.Mec

63

ー

(162)

ー

Net sales*1 Before elimination for consolidation *2. Cos.Mec was included in the consolidation only in the 4Q of FY2/21

Copyright (C) 2022 Freund Corp. All rights reserved.

5

Machinery Business: Group Company Performance (Orders Received/Order Backlog)
 Freund Corporation:
 Freund-Vector:
 Freund-Turbo:
 Cos.Mec:(Millions of yen)

Large order backlog due to a big order for a generic drugs project.
Orders from Brazil and the U.S. are strong, with a record highorder backlog.
Capturing demand at chemical manufacturers in Japan pushed up theorder backlog to a record high.
Record high order backlog due to demand recovery in emerging
countries.
FY2/21
AmountYoY change (%)

FY2/22
AmountYoY change (%)

12,386+21.1

15,621+26.1

FREUND CORPORATION

7,398

+25.0

7,218

(2.4)

FREUND-VECTOR

3,282

+11.1

5,588

+70.3

FREUND-TURBO

1,293

(4.3)

1,366

+5.7

Cos.Mec

412

ー

1,447

＋250.7

Order backlog

6,615

+40.9

10,574

+59.8

4,618

+19.5

5,059

+9.5

FREUND-VECTOR

841

+92.6

3,710

+341.0

FREUND-TURBO

503

+27.4

620

+23.3

Cos.Mec

652

ー

1,183

＋81.5

Orders received

FREUND CORPORATION

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6

Machinery Business: Sales by Region
 Japan:Sales in Japan were mostly in line with the plan.

 North and Latin Americas: Orders were strong while shipments were delayed.
 Europe:

Sales benefited from a large order in Ireland and strong sales in Italy.

 Asia:Lower sales in China were offset by higher sales in other countries.

(Millions of yen)

FY2/21
AmountFY2/22

YoY change (%)

AmountYoY change (%)

Net sales

11,171+0.5%

11,836

+6.0%

Japan

6,696

+0.0%

7,034

+5.0%

Overseas

4,463

+0.9%

4,802

+7.6%

USA

1,570

＋12.9%

1,388(11.6)%

Latin America

642(57.3)%

881+37.3%

Europe572＋27.9%

835+46.0%

Asia

1,224

＋49.9%

1,365+11.6%

Others454＋71.3%

330(27.2)%

Copyright (C) 2022 Freund Corp. All rights reserved.

7

Machinery Business: Quarterly Results
Operatingprofit margin

Net sales(Millions of yen)
5,000

20.0%

Net sales
Operating profit margin

15.0%
4,000

10.0%

3,000
5.0%

0.0%

2,000

(5.0)%
1,000(10.0)%

0
Q1

Q2

Q3

FY2/17(1,000)

Q4

Q1

Q2

Q3

FY2/18

Q4

Q1

Q2

Q3

FY2/19

Q4

Q1

Q2

Q3

FY2/20

Q4

Q1

Q2

Q3

FY2/21

Q4

Q1

Q2

Q3

Q4

(15.0)%

FY2/22(20.0)%

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8

Machinery Business: Quarterly Results (Orders Received/Order Backlog)(Millions of yen)
10,000Order backlog
Net sales
Orders received

8,000

6,000

4,000

2,000

0
Q1

Q2

Q3

FY2/17

Q4

Q1

Q2

Q3

FY2/18

Q4

Q1

Q2

Q3

FY2/19

Q4

Q1

Q2

Q3

FY2/20

Q4

Q1

Q2

Q3

FY2/21

Q4

Q1

Q2

Q3

Q4

FY2/22

Copyright (C) 2022 Freund Corp. All rights reserved.

9

Chemicals Business: Overview
 Net Sales

Pharmaceutical excipients:
Food preservatives:
Dietary supplement:

Export:Strong sales both in domestic and overseas markets.
Strong sales supported by rising demand from new clients.
Significant decline due to the termination of a contract from amajor customer.
Increased due to the expansion of overseas sales.

 Segment Profit:
Profit increased because of higher sales and a lower cost of sales ratio as a result of an
improved production system.

(Millions of yen)

FY2/21
AmountNet sales

FY2/22

YoY change (%)

AmountYoY change (%)

(3.6)

5,795
3,251

+17.6

1,889

(9.1)

2,204

+16.7

Dietary Supplement Products

938

+33.2

340

(63.8)(Export sales)*1

221

+42.0

326

+47.4

Operating profit546(30.1)

884

+62.0

(1.1)

Pharmaceutical Excipients

5,593
2,765

Food Preservatives+3.6*1: Sales to India, South Korea, China, Taiwan, etc.
Copyright (C) 2022 Freund Corp. All rights reserved.

10Chemicals Business: Quarterly Results (by Product Field)Sales of pharmaceutical excipients are gradually increasing.
Sales of food preservative sales are recovering from the impact of COVID-19.
Sales of dietary supplements declined substantially.
The overall profitability is improving due to lower sales of low-margin dietary supplement products andan improvement in the cost-of-sales ratio.
Operatingprofit margin

Net sales(Millions of yen)
2,500

20.0%
Pharmaceutical Excipients
Food Preservatives
Dietary Supplement Products

2,000Operating profit margin
15.0%

1,500

10.0%

1,000

5.0%
500

0.0%

0
Q1

Q2

Q3

FY2/17

Q4

Q1

Q2

Q3

FY2/18

Q4

Q1

Q2

Q3

FY2/19

Q4

Q1

Q2

Q3

FY2/20

Q4

Q1

Q2

Q3

FY2/21

Q4

Q1

Q2

Q3

Q4

FY2/22

Copyright (C) 2022 Freund Corp. All rights reserved.

11Summary of Consolidated Statement of Income
 Extraordinary losses: Substantial decline in profit due an extraordinary loss of approx. 210
million yen.
• Settlement cost related to a copyright infringement case: 130 million yen• Impairment losses on equipment that is no longer expected to be used: 80 million yen(Millions of yen)

Net sales
Cost of sales
Gross profit
SG&A expenses
Operation profit
Non-operating income andexpenses
Ordinary profit
Extraordinary income andlossesProfit before income taxes
ProfitFY2/21

FY2/22

YoY change

AmountComposition
ratio

AmountComposition
ratio

Amount

16,765100.0%

17,632100.0%

+866

+5.2%

11,126

66.4%

11,620

65.9%

+494

+4.4%

5,639

33.6%

6,011

34.1%

+372

+6.6%

4,528

27.0%

5,030

28.5%

+501

+11.1%

1,111

6.6%

981

5.6%

(129)

(11.6)%

197

1.2%

50

0.3%

(146)

(74.2)%

1,308

7.8%

1,032

5.9%

(275)

(21.1)%

(21)

-

(204)

-1.2%

(182)

-

1,286

7.7%

828

4.7%

(458)

(35.6)%

970

5.8%

543

3.1%

(427)

(44.0)%％

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12

Analysis of Change in Consolidated Operating Profit
 The receipt of a pandemic subsidy by U.S. subsidiary Freund Vector Corporation contributed
to earnings in the previous fiscal year. SG&A expenses increased in the current fiscal year due
to the consolidation of Cos.Mec.
(Millions of yen)
Gross profit
Sales

372

Travelingcommission expenses Advertisingexpenses

(18)

(21)

(53)

R&D
expenses

Positive factors(54)

Goodwill

amortization Other

(57)

(64)

Depreciation(69)

Personnel
expenses

(166)

1,111

981

FY2/21

FY2/22
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13

Summary of Consolidated Balance Sheet(Millions of yen)

Current assets

FY2/21-End

FY2/22-End

Change13,55815,004＋1,446

Cash and depodits

4,498

4,145

(353)

Accounts receivable

4,870

5,228

＋358

Inventories

3,473

5,090

+1,616

7,016

7,269

+252

Property, plant and equipment

4,734

4,562

(171)

Intangible assets

1,291

1,434

+143

990

1,271

+281

Total assets

20,57522,273＋1,698Current liabilities

5,817

7,035

＋1,218

Accounts payable

2,966

2,743

(222)

Advances received

1,170

2,805

+1,635

898

883

(15)

280

316

+35

Total liabilities

6,716

7,919

＋1,202

Total net assets

13,85814,354+495

Total liabilities and net assets

20,57522,273+1,698Non-current assets

Investments and other assets

Non-current liabilities
Retirement benefit liability

Inventories
・Merchandise and finished goods (132)
・Work in process+933
・Raw materials and supplies+816

Advances received
・Freund Corporation +193
・Freund-Vector+903
・Cos.Mec+594

Copyright (C) 2022 Freund Corp. All rights reserved.

14

Summary of Consolidated Statement of Cash Flows(Millions of yen)

FY2/21

Cash flows from operating activities

FY2/22

2,280

701

1,286

828

Depreciation

461

570

Decrease (increase) in notes and accounts receivable - trade

674

(299)

Decrease (increase) in inventories(112)(1,430)

Increase (decrease) in notes and accounts payable - trade

(340)

(154)

Income taxes paid

(174)

(394)

(1,726)

(680)

(469)

(460)

(8)

(236)

Cash flows from financing activities

(371)

(427)

Repayments of lease obligations

(9)

(39)

(333)

(335)

184

(353)

4,498

4,145

554

21

Profit before income taxes

Cash flows from investing activities
Purchase of property, plant and equipment
Purchase of intangible assets

Cash dividends paid
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at end of period
Free cash flow

Copyright (C) 2022 Freund Corp. All rights reserved.

15

Consolidated Earnings and Dividend Forecasts for FY2/23

Copyright(C) 2022 Freund Corp. All rights reserved.

Summary of Consolidated Forecasts
 Expect strong domestic machinery orders as the generic drug industry plans to upgrade its
facilities. Overseas subsidiaries also have record high order backlogs..
 Expect longer shipment lead time and rising component prices to continue due to tightsupplies of components throughout FY2/23.
 FY2/23 is expected to a period for building a base for growth in the next fiscal year.

(Millions of yen)

Net sales

FY2/22

FY2/23(Actual)(Forecast)

YoY change％

Amount17,632

18,500+867+4.9Operating profit

981

700

(281)

(28.7)

Ordinary profit

1,032

720

(312)

(30.3)

543

450

(93)

(17.2)

Earnings per share (yen)

32.46(5.59)(17.2)

Yen/dollar rate

111.4926.87
120.00--

ProfitCopyright (C) 2022 Freund Corp. All rights reserved.

17

Summary of Segment Forecasts
 Machinery:

Increase global coverage, including emerging countries, with a five-polestructure comprising Japan, the U.S., Italy, India and China.

 Chemicals:

Growth in sales of pharmaceutical excipients offsets a decline in sales of
dietary supplement.

(Millions of yen)

FY2/22
AmountConsolidated net sales

YoY change

FY2/23 (Forecast)Composition
ratio (%)

Composition
ratio (%)

AmountAmount％17,632100.0

18,500

100.0

+867

+4.9

Machinery Business Segment

11,83667.1

12,700

68.6

+863

+7.3

Chemicals Business Segment

5,795

32.9

5,800

31.4

＋4

＋0.1

981

100.0

700

100.0

(281)

(28.7)

Machinery Business Segment

623

63.5

-

-

-

-

Chemicals Business Segment

884

90.1

-

-

-

-

Adjustments(526)(53.6)----

Yen/dollar rate

111.49-120.00---

Segment profit

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18

Summary of Dividend Forecasts
 FY2/22 dividend forecast:

20 yen per share (unchanged from FY2/21 due to the policy of
paying a stable dividend)
20 yen per share FY2/23 dividend forecast:

100.0%

Consolidated dividend payout ratio

90.0%
80.0%

74.4%

87.8%
61.6%

70.0%
60.0%
50.0%
40.0%
30.0%

39.9%

37.2%
21.2%

22.5%

27.4%

34.5%

32.4%
23.3%

22.4%

20.0%
10.0%
FY2/12

FY2/13

FY2/14

FY2/15

FY2/16

FY2/17

FY2/18

FY2/19FY2/20FY2/21

FY2/22

FY2/23(Forecast)Profit (\ million)

608

765

787

695

961

1,064

1,477

843

381

970

543

450

Dividend per share (yen)

7.5

10.0

12.5

15.0

12.5

20.0

20.0

20.0

20.0

20.0

20.0

20.0

9,200

9,200

9,200

9,200

9,200

18,40018,40018,40018,40018,40018,40018,400

Number of shares outstanding(Thousand shares)

Note: Freund conducted a 2-for-1 common stock split on June 1, 2009 and March 1, 2016. The dividends per share for FY2/16 and earlier have beenadjusted to reflect the stock split.
Copyright (C) 2022 Freund Corp. All rights reserved.

19

8th Medium‐term Management Plan

Copyright(C) 2022 Freund Corp. All rights reserved.

8th Medium-term Management Plan – Second Year Accomplishments
 or FY2/22, the initial targets were consolidated sales of 19.0 billion yen and consolidated
operating profit of 1.2 billion yen. However, the targets have been revised downward to 18.5
billion yen and 1.1 billion yen, respectively, by taking into account the impact of the pandemic.
 Consolidated sales were 17.63 billion yen, a shortfall of 4.7%, and consolidated operating profit
was 980 million yen, a shortfall of 10.8%.
 Although orders received by overseas subsidiaries are strong, this is largely attributable tolonger shipment lead times caused by tight supplies of components, particularly in the U.S.
Net sales(Millions of yen)
25,00020,000

Achievement ratio：‐5.8％

17,80019,05016,765

Operating profit

Achievement ratio：‐4.7％

18,500(Millions of yen)
1,600 Achievement ratio：+14.7％

20,1401,400
17,632

1,200
1,000

15,000

1,147

Achievement ratio：‐10.8％

1,460

1,220
1,100

1,000

981

800

10,000

600
400

5,000

200

0

0

Forecast

ActualInitial plan

RevisedActualInitial Plan

Forecast

Actualplan
FY2/21

FY2/22

Initial plan

RevisedActualInitial Plan

plan

FY2/23

FY2/21

FY2/22

Copyright(C) 2022 Freund Corp. All rights reserved.

FY2/2321

8th Medium-term Management Plan – Outlook for the Final Year The initial targets for FY2/23, the final year of the 8th Medium-term Management Plan, wereconsolidated sales of 20.14 billion yen and consolidated operating profit of 1.46 billion yen.
To achieve these targets, a global five-pole structure has been established: Japan, the U.S.,
India, Italy, and China.
 The order environment is favorable as overseas subsidiaries hold record order backlogs andthe generic drug industry in Japan is ramping up capital expenditures.
 However, delays in shipments due to tight supplies of components in the U.S., which became
apparent in the second half of FY2/22, are likely to appear in Japan in FY2/23.
 Since the effects of supply chain disruptions are
expected to be significant, the forecast for FY3/23
is conservative.

Net sales

20,140(Millions of yen)

 For these reasons, we expect consolidated sales of
18.5 billion yen and consolidated operating profitof 700 million yen in FY2/23.

18,5001,460
700

Initial plan

Revised plan

Copyright(C) 2022 Freund Corp. All rights reserved.

22

8th Medium-term Management Plan
Corporate
Philosophy

Develop the Future through Creativity

Management
VisionFreund Group will contribute to better medical care and health for people worldwide and creating andutilizing technologies for fulfilling lives and food safety

Values which the FREUND
Group holds precious

Create special forms of value
Aim to be the leader in all of
the group s business sectors

Core Strategy

Create a structure for business operations that canuse technologies to meet the true needs ofcustomers and achieve consistent growth in earnings
Seven Goals
1. Group collaboration

Always use the customer’s
perspective

2. Putting clients’ views 1st

Be a company like no otherfor customers and society

3. Emphasis on innovation
4. Global management
5. Execution of growth strategy

Networking
Solidify the group to create a
unified organization

6. Promotion of business process reengineering
and work style reforms
7. Emphasis on compliance and corporate governance
Copyright (C) 2022 Freund Corp. All rights reserved.

23

8th Medium-term Management Plan: Seven Goals
1. Group collaboration
Make all three group companies a unified organization and use this cohesiveness for collaboration for sales andR&D in order to achieve consolidated performance targets.

2. Putting clients’ views 1st
Supply products with outstanding quality in every respect along with prices and speed that meet customers’
expectations.

3. Emphasis on innovation
Channel substantial resources to creating new products, as an organization specializing in developing
technologies and other ideas, and rigorously manage progress concerning development plans.

4. Global management
While capturing market share in Japan, operations of all group companies must reflect the shift of customers’
activities to other countries and the growing importance of quality in overseas markets.

5. Execution of growth strategy
Use M&A, business alliances and other activities to create businesses that can be the foundation of the next
medium-term management plan and step up measures to achieve non-organic growth in existing businesses.

6. Promotion of business process reengineering and work style reforms
Eliminate inefficient tasks and jobs and become a highly efficient organization with pleasant and productive
workplaces.

7. Emphasis on compliance and corporate governanceImprove production and quality management structure, upgrade internal controls, and take other actions todevelop the sound operation of businesses in order to earn the trust of customers and society.
Copyright (C) 2022 Freund Corp. All rights reserved.

24

(Supplementary Materials)
・ Company Overview
・ Segment Information

Copyright(C) 2022 Freund Corp. All rights reserved.

Company Overview● Company name：Freund Corporation● Established：

April 1964

● Representative：

Iwao Fusejima, President & CEO● Location：

6‐25‐13 Nishi‐shinjuku, Shinjuku‐ku, Tokyo, Japan● Paid‐in capital： 1,035,600,000 yen (As of February 28, 2022)● Sales： 17,600 million yen (Fiscal year ended February 2022, consolidated)● Number of employees： 476 (As of February 28, 2022, consolidated)● Business： Machinery business‐ Manufacturing and sales of granulationand coating equipment and others
Chemicals business‐ Manufacturing and sales of pharmaceutical
excipients, food preservatives, and others● Group companies： Freund‐Vector Corporation, Freund‐Turbo Corporation,
Cos.Mec s.r.l., Parle Freund Machinery Private Limited

Copyright (C) 2022 Freund Corp. All rights reserved.

26

The Freund Group and R&D Facilities

Using innovative technologies
for rapid growth outside Japan
FreundCorporation
Freund‐Turbo
Corporation
Yokosuka, Kanagawa

Tokyo, Osaka, Shizuoka, Aichi

Cos.Mec s.r.l.

Freund‐Vector
Corporation
Iowa, USA

Milan, Italy

Research and Development
Laboratory(Hamamatsu, Shizuoka)

Domestic
users

Marion Laboratory (Iowa, USA)

Sales of machineryand chemical products

Sales of machineryand chemical products

Parle Freund (India)

Overseas
users

Milan Laboratory (Milan, Italy)
Copyright (C) 2022 Freund Corp. All rights reserved.

27

Our “Pen” (Machinery) and “Ink” (Chemicals) Business Model

1. Machinery Business Segment

Pen Manufacturing and sales of granulation and coating
equipment for the pharmaceutical, food, and fine chemicalindustries.
 For coating equipment, Freund ranks first in Japan and sales
growth is accelerating in Asian market and in FreundVector’s US and European operations. No other company inthe world has expertise in both drug formulation
technologies and the associated machinery.
 Aiming to increase sales of machinery for industrial
applications too by combining granulating and coating
technologies with milling and sieving technologies.

2. Chemicals Business SegmentComposition of Net
Sales and Profit bySegment
Chemicals

33%
41%

FY2/22

Ink
Manufacturing and sales of pharmaceutical excipients, food59%
preservatives, nutritional supplements, and others.
Operating profit
Freund uses Good Manufacturing Practice (GMP) compliant
67%
equipment to produce pharmaceutical excipients.
Food preservatives made by Freund help ensure the safety
Net salesof food by maintaining the quality of many types of
Machinery
products.
By using its granulating and coating technologies, Freund¥17.63 billion
has worked with customers to develop and commercialize Consolidated sales:
Consolidated operating profit:¥9.8 billion
nutritional supplements and seamless mini-capsules.
Copyright (C) 2022 Freund Corp. All rights reserved.

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Freund Group’s Business Fields
 FREUND Group’s business fields based upon pharmaceutical products manufacturing processes
FREUND Group Business Fields
ActivePharmaceutical
Ingredients

Grinding/
Classifying

Blending/
Kneading

Granulating

Drying/
Grading

TabletingCoating

TabletPrinting

Packing

Using core competences in Machinery and Chemicals Divisions to provide unique products
Grinding/Classifying
Equipment

Granulating
Equipment

Coating Equipment

Printing Equipment

Fine Chemicals

Excipient

Coating Liquids

Ink

Domestic

Overseas （）

Strengthen Non-Pharmaceutical
Fortify
Product Field
Global Operations

Enter into
New Business Fields
Copyright (C) 2022 Freund Corp. All rights reserved.

29

The Freund Group Disclosure Policy
1. Basic disclosure policy
Freund positions the transparency of management as an important responsibility in order to be a company that can be a trusted
member of society. To maintain this transparency, we always disclose information about the company in a manner that is fair and timely
from the standpoint of all stakeholders.
2. Standard for disclosure
Freund discloses information in compliance with the Companies Act, Financial Instruments and Exchange Act, and other applicable laws
and regulations. Disclosure also complies with the timely disclosure rules of securities exchanges where the company’s stock is traded.
In addition, Freund discloses information that is not covered by these laws and regulations and exchange rules in cases where theinformation is believed to be necessary for investment decisions.
3. Disclosure methods
Freund discloses information by using the Timely Disclosure network (TDnet) of the Tokyo Stock Exchange. To ensure the timeliness andfairness of information announced using TDnet, this information is posted promptly on Freund’s website.
In addition, press releases and other information are promptly posted on Freund’s website and made available in other ways to ensuredisclosure fairness and speed. Furthermore, information in Japanese is supplied in English as much as possible to make information
available to a large number of stakeholders.
4. Prevention of insider trading
For the prevention of insider trading, Freund’s internal rules include provisions concerning basic items that must be observed regarding
the proper management of internal information, Freund stock transactions and other matters. There are also activities for ensuring that
Freund personnel understand insider trading restrictions and for overseeing stock and other transactions.
5. Silent period
To prevent leaks of information about earnings announcements, as well as to comply with laws and regulations and ensure the fairnessof these announcements, Freund has a “silent period” that begins on the day following the end of each fiscal year quarter and ends onthe day of the earnings announcement for that quarter. Freund will not reply to any questions concerning results of operations during
this period. However, in the event of the possibility that results of operations will differ significantly from the forecast, Freund may
disclose this information in accordance with timely disclosure rules.
6. Forward-looking statements
Information disclosed by Freund may contain information about the future other than sales and earnings forecasts, such as information
about strategies and business plans. This information is based on the decisions of management by using information that was available
at that time. As a result, actual performance may differ significantly from forward-looking statements due to changes in the economy
and market conditions and other reasons.
(Established on March 27, 2017)

Investor Relations Policy
Policy concerning constructive dialogues with shareholders and other investors
Freund has a strong commitment to conducting constructive dialogues with shareholders and other investors in order tocontribute to the company’s sustained growth and mid- to long-term growth in corporate value. By providing clear explanationsof management policies, business operations and the corporate culture, Freund aims to earn the understanding of shareholders
and other investors in order to continue to receive their support as “Freund fans.”
1. Investor relations framework – The Corporate Planning Division responsible for investor relations oversees dialogues withshareholders and other investors under the direct supervision of the company’s president. In addition, the president is
assisted by a director who is in charge of investor relations.
To support these dialogues, Freund departments involved with dialogues cooperate, such as by preparing and checking
disclosure materials and, as needed, sharing information, so that information is disclosed with fairness and speed.
2. Stakeholder dialogues – Freund holds information meetings about results of operations and other subjects following theend of the second quarter and fiscal year. Small meetings are held after the first and third quarters. Information provided atthese meetings is posted on Freund’s website. When a medium or long-term management plan is established, the company
provides a clear explanation of strategic goals and business plans. In addition, Freund frequently visits institutional investors
to explain its goals and performance. Freund also participates in investor forums held by securities companies, holds
information meetings for individual investors, and conducts other activities for stakeholder dialogues.
The FREUND Integrated Report and other IR documents are distributed to shareholders and posted on Freund’s website.
This publication contains business and financial information as well as about the company’s strengths that do not appear in
the financial statements. By providing more information about the Freund Group, this publication aims to help the public
understand the true corporate value of the group.
3. Feedback of shareholder/investor opinions – Opinions and other statements by shareholders and other investors at
dialogues are passed on to the president, directors and others and the information is shared as needed.
4. Management of insider information – There are no shareholder/investor dialogues during each silent period, which begins
on the day following the end of each fiscal year quarter and ends on the day of the earnings announcement for that quarter.
Freund handles insider information strictly in compliance with internal rules concerning the management of internal
information and restrictions on transactions by Freund personnel.

Inquiries:

Freund Corporation
Corporate Planning Department
Corporate Planning Division /Accounting Division
Tel: +81-3-6890-0767
Fax: +81-3-6890-0870
Email: ir@freund.co.jp

IR website: https://www.freund.co.jp/english/
This presentation contains forward-looking statements involving plans, outlooks, strategies and policies. Thesestatements reflect the judgments of management and assumptions based on information available at the time ofthis presentation. Actual results of operations may differ from these statements for a number of reasons.
Consequently, forecasts and other forward-looking statements are not guarantees about future performance.
Although Freund has checked this presentation carefully, there is still a possibility of errors in this information.

Copyright (C) 2022 Freund Corp. All rights reserved.

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