[Paper-Based Documents for Delivery]
Security Code: 7741

The 86th Ordinary General Meeting of Shareholders

Proposals, Business Report, Etc.

Message from CEO
I would like to express my thanks for your continued patronage.
I would like to convey our deepest apologies to our shareholders, customers, business partners, and otherstakeholders for any inconvenience caused by the IT system incident in our Group that occurred as a resultof a malicious cyberattack by a third party in March of this year.
I would also like to announce that HOYA CORPORATION (the “Company”) will hold its 86th Ordinary General
Meeting of Shareholders on Thursday, June 27, 2024.
Regarding performance in the current fiscal year, we achieved record high sales against the backdrop of strong
performance of the Life Care business. In the Life Care business, sales increased substantially due to strong
sales of high value-added products and a rebound from the lockdown in China. In the Information Technology
business, sales of mask blanks for semiconductor manufacturing and glass substrates for HDDs decreased
due to inventory adjustments, but a gradual recovery was seen toward the end of the fiscal year.
With respect to the allocation of capital, the Company actively invested in business expansion, and withrespect to returns to shareholders, while paying a dividend of 110 yen per share, we purchased approximately
56.0 billion yen of the Company’s own shares. We have made further purchases of approximately 50.0 billion
yen of the Company’s own shares in May. Going forward, under management conscious of capital efficiency,
we will continue to prioritize the allocation of capital to growth investments such as M&A and capital
expenditures, with due consideration to the business environment and capital needs, while allocating surplus
funds to shareholder returns through dividends and share repurchases.
For ESG and sustainability, we accelerated our initiatives in the area of “E” (Environment) in particular. In April
2023, the Company disclosed information on climate change based on the TCFD recommendations for the
first time, and we set a goal to procure 100% of in-house electricity consumption from renewable energy
sources by FY2040.
We continue to see significant changes in theexternal environment mainly due to growing
geopolitical risks and increasing demands for
decarbonization in response to the global
increase in abnormal weather events. Under
these circumstances, we will strive to
respond quickly to the requests from society,customers, employees and otherstakeholders, and increase both social value
and corporate value through realization of
the Company’s vision “Innovating For a Better
Tomorrow.”
We sincerely ask for your continued support.

Eiichiro Ikeda
Director, Representative Executive Officer President & CEOCorporate Mission“Dedicated to innovation in
information technology,
lifestyles and culture,
HOYA envisions a world
where all can enjoy the good life,
living in harmony with nature.”

INDEX
Reference Material for
the General Meeting of Shareholders

5

Proposal : Election of sevent (7) Directors

Commitment
tosociety

Commitment
tocustomers

Management
Dedication
to innovative
management

Principles
Commitment
toshareholders

Commitment
toemployees

VisionInnovating For a Better Tomorrow

Business Report

15

Consolidated Financial Statements

44

Independent Auditor’s Report for
the Consolidated Financial Statements

47

Nonconsolidated Financial Statements

50

Independent Auditor’s Report

53

Audit Committee’s Audit Report

56

HOYA Group’s Businesses
Based on the concept of “Business Portfolio Management” and “Big Fish in a Small Pond,”
HOYA has developed highly competitive businesses focused on two segments, Life Care andInformation Technology.

We are making the future a better place by resolving social issues throughLife Care
Health Care
Engages in manufacturing andSales

sales of eyeglass lenses andoperation of “Eyecity,” contact lens
specialty retail stores.
Eyeglass lenses“Eyecity,” contact lens specialty
retail stores
Eyeglass lenses(MiYOSMART)*“Eyecity” store

HealthCareMedicalMain products are medical
endoscopes, intraocular lenses
for cataracts, apatite productsthat are prosthetic fillers for bone
defects, etc.
Medical endoscopes
Medical endoscope(PENTAX Medical INSPIRA™)*

Intraocular lenses for cataracts

Intraocular lenses forcataracts

Artificial bones/metallic
orthopedic implants* As of April 2024, this product has not been approved in Japan.

3efficiently allocating management resources to growth areas such as the Life Care business, whosemarket is expected to expand due to the aging of the world population and improvement in living
standards in emerging markets, and semiconductors and HDD-related products in the Information
Technology business, whose market is expected to grow due to the progress of an increasingly
digital society.

Reference Material for the General Meeting of Shareholders

The HOYA Group will continue striving to sustainably increase its social value and corporate value by

innovation in the areas of “Vision,” “Health,” and “Information Society.”

Information Technology

Composition

Business ReportElectronics
Deals in glass-made components
and materials essential for
manufacturing semiconductors,
FPDs and HDDs.

Electronics

Mask blanks for semiconductors
Photomasks for semiconductors
Photomasks for FPD
Glass disk substrates for HDDs

Mask blanks for semiconductor

Glass disk substrates for HDDs

Optical lenses

Optical glasses

Imaging

Imaging

MedicalDeals in optical lenses, opticalglass material, etc.

Optical lenses
Laser related equipment

Note: ‌The term “HOYA” herein refers to “HOYA Group” in reference to its history, activities, operating results, etc.
In particular, statements concerning HOYA on a nonconsolidated basis are written in the form of “HOYA
Corporation.”

4

Financial Statements

Optical glass material

Reference Material for the General Meeting of Shareholders

Reference Material for the General Meeting of Shareholders
Proposal

Election of Seven (7) Directors

The term of office of all of the seven Directors will expire at the close of this Ordinary General Meeting of
Shareholders. As a result of deliberations on the number of members and composition of the Board of
Directors in consideration of the diversity, management experience, and expertise prior to the selection ofcandidates by the Nomination Committee, it is being proposed that, seven Directors be elected - five
Independent Directors and two Inside Directors. The reason for the selection of each candidate is statedindividually in the following pages.
The Nomination Committee has reported that according to the “Basis for Election of Candidates for
Directors” established by the committee, each candidate for Director does not fall under any reason for
disqualification and all candidates for both Inside Directors and Independent Directors meet therequirements for such candidates.
All Independent Directors are to serve on the following three committees: the Nomination Committee,
the Compensation Committee, and the Audit Committee.

Financial Statements

Business Report

The candidates for Directors are as follows:
No.

Name

1

Hiroaki Yoshihara

Current positions and assignments at the Company

Director, Chairperson of the Audit Committee
Member of the Nomination Committee
Member of the Compensation Committee

Independent

Director, Chairperson of the Nomination Committee
Member of the Compensation Committee
Member of the Audit Committee

Independent

2

Yasuyuki Abe

3

Takayo Hasegawa

Director, Member of the Nomination Committee
Member of the Compensation Committee
Member of the Audit Committee

Independent

4

Mika Nishimura

Director, Member of the Nomination Committee
Member of the Compensation Committee
Member of the Audit Committee

Independent

5

Mototsugu Sato

Director
Chairperson of the Compensation Committee
Member of the Nomination Committee
Member of the Audit Committee

Independent

6

Eiichiro Ikeda

Director, Representative Executive Officer
President & CEO

7

Ryo Hirooka

Director, Representative Executive Officer & CFO(Note) Mr.
‌
Hiroaki Yoshihara, Mr. Yasuyuki Abe, Ms. Takayo Hasegawa, Ms. Mika Nishimura and Mr. Mototsugu Sato are candidates for the posts ofIndependent Directors. The Company has provided notice to the Tokyo Stock Exchange of Mr. Hiroaki Yoshihara, Mr. Yasuyuki Abe, Ms. Takayo
Hasegawa, Ms. Mika Nishimura and Mr. Mototsugu Sato as being Independent Directors appointed by the Company, in accordance with theTokyo Stock Exchange’s rules and regulations.

5

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Nov. 1978
Jul. 1996
Oct. 1997
Oct. 2003
Jun. 2018

Hiroaki Yoshihara

Joined Peat Marwick Mitchell & Co.
National Managing Partner, the Pacific Rim Practice of
KPMG LLPThe Board Member of KPMG LLP
Vice Chairman and Global Managing Partner of KPMGInternational (retired in April 2007)
Director of the Company (present post)(Important positions of other companies concurrently held)
Outside Director of Hitachi, Ltd.

Reference Material for the General Meeting of Shareholders

No.

(Born on Feb. 9, 1957)
Candidate for Independent
Director[Number of years in office of the
Director of the Company]
6 Years[Number of shares of theCompany held] 0 Shares

Reason for the Selection of Candidate for Director and Overview of Expected Roles
The above candidate has long-term experience as an expert in finance and accounting as well as management
experience gained as Global Managing Partner of an international accounting firm. He also has a track recordof participating in the M&A of many companies from a professional standpoint. The Company’s Nomination
Committee has judged that he will contribute to enhancing the supervisory function of the Board of Directorsof the Company and at the same time provide plenty of advice in regard to M&A, an important measure in the
Company’s business strategy, so it has nominated him as a candidate for Director again this year. Nothing inconnection with the candidate violates the independence requirements for a Director candidate provided forin the “Basis for Election of Candidates for Directors” set forth by the Nomination Committee of the Company.

Business Report1[Number of attendances to theboard meetings] 10/10 times(100%)

Message to Shareholders from Candidate

6

Financial Statements

Currently, the business environment remains uncertain with heightened tensions of high geopolitical risks in
Ukraine and the Middle East, as well as uncertainties in prices, exchange rates, and policy interest rates invarious countries. Under these difficult circumstances, HOYA will respond promptly to these various anddiverse risks and continue to promote thorough Business Portfolio Management, making further improvements
to business and management efficiency, execution of sustainability programs, and formulation andimplementation of new strategies for medium- to long-term growth, aiming to contribute to the creation of atruly affluent society by solving social issues in the Life Care and the Information Technology segments. As an
Independent Director with many years of experience in global management and participating in the M&A ofmany companies, I will sincerely strive to support and supervise the execution of duties by the management
team from an independent standpoint in order to enhance both corporate value and social value.

Reference Material for the General Meeting of Shareholders

No.

Name

Apr. 1977
Jun. 2002
Apr. 2005
Jun. 2009

Yasuyuki Abe(Born on Apr. 17, 1952)
Candidate for Independent
Director[Number of years in office of the
Director of the Company]
3 Years[Number of shares of theCompany held] 0 SharesBusiness Report

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

[Number of attendances to theboard meetings] 10/10 times(100%)

2

Apr. 2010
Apr. 2011

Apr. 2013
Jun. 2015
Jun. 2021

Joined Sumitomo Corporation
Representative Director and President of Sumisho
Electronics Co., Ltd. (present SCSK Corporation)
Representative Director and President of Sumisho
Computer Systems Corporation (present SCSKCorporation)
Representative Director, Managing Executive Officer,
General Manager, Financial & Logistics Business Unit of
Sumitomo Corporation
Representative Director, Managing Executive Officer,
General Manager, New Industry Development & Crossfunction Business Unit of Sumitomo Corporation
Representative Director, Senior Managing Executive
Officer, General Manager, New Industry Development &Cross-function Business Unit, General Manager, Financial
Service Division of Sumitomo Corporation
Representative Director, Senior Managing Executive
Officer, General Manager, Corporate Planning &Coordination Group of Sumitomo Corporation
Advisor of Sumitomo Corporation (retired in June 2018)
Director of the Company (present post)(Important positions of other companies concurrently held)
Outside Director of SUBARU CORPORATION (scheduled to retire theposition in June 2024)

Reason for the Selection of Candidate for Director and Overview of Expected Roles
The above candidate was primarily engaged in the electric power, machinery, and information fields at
Sumitomo Corporation, a general trading company. After stationed twice in the United States, he served as
representative director and president of the company’s electronics and information related subsidiaries.
Subsequently, as a representative director of Sumitomo Corporation, he was engaged in the company’s
financial, logistics and new business development. The Company’s Nomination Committee has judged that hewill contribute to the Board of Directors of the Company through his wide-ranging experience at the general
trading company, his global mindset cultivated over the years of stay in the United States, his businessexperience nurtured as a representative director and president, and his experience as an independent director
gained at other companies after leaving Sumitomo Corporation, so it has nominated him as a candidate for
Independent Director. There were transactions in the fiscal year 2023 between the HOYA Group and Sumitomo
Corporation, which the candidate comes from, but the amount involved in the transactions represents lessthan 0.1% of the consolidated net sales of each party, and nothing in connection with the candidate existsthat violates the independence requirements for a Director candidate provided for in the “Basis for Election of
Candidates for Directors” set forth by the Nomination Committee of the Company.

Financial Statements

Message to Shareholders from Candidate
Recently, the international business environment has been changing rapidly and becoming increasingly
unpredictable due to various factors such as geopolitical risks, technological innovation, sustainability andsocial responsibility, etc. HOYA has grown by managing its business in a way that responds flexibly to thesechanges.
I hope to continue contributing to sustainable growth and enhance the medium- to long-term corporate valueof the HOYA Group through both supervision and support activities for the executive team as an Independent
Director, based on many years of global corporate activities at a trading company and experience inmanagement in the IT, electrical equipment, and automotive industries.

7

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Apr. 1984
Jun. 2005
Apr. 2006
Apr. 2010

Takayo Hasegawa(Born on Oct. 15, 1959)
Candidate for Independent
Director[Number of years in office of the
Director of the Company]
2 Years[Number of shares of theCompany held] 0 Shares

3

Jun. 2018
Apr. 2019
Apr. 2020
Jun. 2022
Apr. 2024(Important positions of other companies concurrently held)
Representative Director CEO of SWCC Corporation
Reason for the Selection of Candidate for Director and Overview of Expected RolesBusiness Report[Number of attendances to theboard meetings] 10/10 times(100%)

Jun. 2013

Joined SHOWA ELECTRIC WIRE AND CABLE CO., LTD.
(present SWCC Corporation)
Deputy Director of Technical Development Center andManager of Superconducting Project of SHOWA ELECTRIC
WIRE AND CABLE CO.
Director, Director of Technical Development Center of
SWCC SHOWA CABLE SYSTEMS CO., LTD.
Managing Director, Director of Technical Development
Center of SWCC SHOWA CABLE SYSTEMS CO., LTD., andCorporate Officer, General Manager of The Technology
Planning Office of SHOWA ELECTRIC WIRE AND CABLE
CO., LTD. (present SWCC Corporation)
Director, General Manager of The Technology Planning
Office of SHOWA ELECTRIC WIRE AND CABLE CO., LTD.
President and Director of SWCC SHOWA HOLDINGS CO.,LTD.
President and Representative Director, Group CEO of
SWCC SHOWA HOLDINGS CO., LTD.
President and Representative Director, Chairman of theBoard of Director, Group CEO of SWCC SHOWAHOLDINGS CO., LTD.
Director of the Company (present post)
Representative Director CEO of SWCC Corporation(present post)

Reference Material for the General Meeting of Shareholders

No.

The above candidate was engaged for many years as a researcher in the R&D divisions of the SWCC Group(present the SWCC Group), which was originally established in the electric wire and cable industry andexpanded widely into the Energy/Infrastructure, Communications/Industrial Devices, and Electrical Equipment/
Components businesses, promoting the technological development of the SWCC Group. Since taking office as
the first female President and Representative Director from the R&D divisions in the SWCC Group in 2018, she
has implemented rapid reform of governance by dividing the business of SWCC SHOWA HOLDINGS CO., LTD.
into segments, helping to ensure stable profitability. The Company’s Nomination Committee has judged that
she will contribute significantly to the Company’s management based on her experience as a manager backed
by expertise as an engineer and with regard to initiatives for new business and transformation, so it has
nominated her as a candidate for Director. There were no transactions in the fiscal year 2023 between the
HOYA Group and SWCC, which the candidate comes from, and nothing exists that violate the independence
requirements for a Director candidate provided for in the “Basis for Election of Candidates for Directors” set
forth by the Nomination Committee of the Company.
Message to Shareholders from Candidate

8

Financial Statements

The environment surrounding the Company has become increasingly uncertain due to global geopolitical risks,
conflict risks, climate change risks, etc. Even in such an environment, HOYA has remained committed tocreating new value by contributing to people’s health and cutting-edge semiconductor technologies. In orderfor the Company to continue to place importance on sustainability, transparency, and fairness, and develop as
a company that is an integral part of society, as an Independent Director, I will strive to contribute to enhance
the corporate value by making use of the experience I gained while working concurrently as an engineer anda corporate manager.

Reference Material for the General Meeting of Shareholders

No.

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Jun. 1985
Aug. 1989
Jan. 1992
Sep. 1999
Oct. 2002
Jan. 2007
Jan. 2011

Mika Nishimura

Apr. 2011(Born on Aug. 14, 1963)

Nov. 2015

Candidate for Independent
Director

Jun. 2022[Number of years in office of the
Director of the Company]
2 Years

Joined BAIN & COMPANY
Joined LEK PARTNERSHIP
Director, Global Marketing of GUIDANT CORPORATIONManaging Partner of THE BLG GROUP
Vice President International Sales, Operations andMarketing of EV3
Managing Partner of THE BLG GROUP
Operational Partner of GILDE HEALTHCARE PARTNERS(present post)
Vice President, Commercial Development of AUXOGYN(present PROGYNY)
Vice President, Commercialization of NVISION MEDICALCORPORATION (present BOSTON SCIENTIFIC)
Director of the Company (present post)(Important positions of other companies concurrently held)
Operational Partner of GILDE HEALTHCARE PARTNERS

Business Report[Number of shares of theCompany held] 0 Shares[Number of attendances to theboard meetings] 10/10 times(100%)

4

Reason for the Selection of Candidate for Director and Overview of Expected Roles
The above candidate has over 30 years of experience in the medical technology sector and was engaged incommercialization strategy on a global scale (50 markets in North America, Europe, the Asia-Pacific region, andCentral and South America). Through leadership positions, including Director, Global Marketing, she has been
involved in clinical and business strategies and has a proven track record in helping to launch franchises that
contribute to stable revenue growth. In addition, her experience as a partner in a life science venture fund has
given her a broad global perspective on the latest technologies and companies. Based on her past experience,
the Company believes that she will contribute to strengthening the supervisory function, primarily in the life
science business, and at the same time provide a great deal of advice on business strategy of the Company,
so she has been nominated as a candidate for Director. There were no transactions in the fiscal year 2023
between the HOYA Group and GILDE HEALTHCARE PARTNERS, which the candidate comes from, and nothing
exists that violates the independence requirements for a Director candidate provided for in the “Basis forElection of Candidates for Directors” set forth by the Nomination Committee of the Company.

Financial Statements

Message to Shareholders from Candidate
Approximately 60% of HOYA’s sales come from the Life Care domain, and the Life Care activities themselves
cover a wide range of areas. A major theme for HOYA is deciding what new markets to enter, or how to apply
HOYA’s technology to new clinical fields, based on the track record we have built up to date. During my morethan 30-year career in the medical technology industry, I have witnessed constant technological innovationand market change. As an Independent Director, I would like to support the management team in pursuing
portfolio development leading to responsible revenue growth while observing strict regulations governing
medical devices that impact patient safety and health. Moreover, as a female business leader with global
experience based in the U.S., I hope to promote the diversification of human resources throughout the HOYA
Group and contribute to fostering the next generation of leaders.

9

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Apr. 1979
Apr. 2008
Apr. 2011
Oct. 2013
Jun. 2014
Apr. 2015

Mototsugu Sato
(Born on Oct. 17, 1956)
Candidate for Independent
Director[Number of years in office of the
Director of the Company] 1 Year
[Number of shares of theCompany held] 0 Shares

Apr. 2016
Jun. 2017
Apr. 2019
Apr. 2022

Jun. 2023

5(Important positions of other companies concurrently held)
Representative Director, Executive Vice President of Panasonic Holdings
Corporation
Representative Director, Member of the Board, President and Chief
Executive Officer (CEO) of Panasonic Operational Excellence Co., Ltd.

Business Report[Number of attendances to theboard meetings] 8/8 times(100%)

Joined Matsushita Electric Works Ltd.
Executive Officer of Matsushita Electric Works Ltd.
Senior Executive Officer in charge of accounting ofPanasonic Electric Works Co., Ltd
Executive Officer in charge of Planning of Panasonic
Corporation
Director in charge of Planning of Panasonic Corporation
Managing Director in charge of Planning of Panasonic
Corporation
Representative Director and Senior Managing Director in
charge of Planning and Human Resources of Panasonic
Corporation
Representative Director, Senior Managing Executive
Officer, Chief Strategy Officer (CSO), and Chief Human
Resources Officer (CHRO) of Panasonic Corporation
Representative Director and Executive Vice President,
Director of Corporate Strategy Division of Panasonic
Corporation
Representative Director, Executive Vice President ofPanasonic Holdings Corporation (present post)
Representative Director, Member of the Board, President
and Chief Executive Officer (CEO) of PanasonicOperational Excellence Co., Ltd. (present post)
Director of the Company (present post)

Reference Material for the General Meeting of Shareholders

No.

Reason for the Selection of Candidate for Director and Overview of Expected Roles

Message to Shareholders from Candidate
The world situation is becoming increasingly chaotic, and geopolitical risks in particular are having a major
impact on global corporate strategies. HOYA aims to realize the well-being of people around the world
through thorough Business Portfolio Management, anticipating changes in the business environment from a
medium- to long-term perspective and taking adequate precautions against risks. Based on my global
management experience gained in other industries and from an objective standpoint as an Independent
Outside Director, I will try to support and supervise the execution of duties by the executive management
team from a governance perspective and strive to contribute to maximizing HOYA’s corporate value.

10

Financial Statements

The above candidate has extensive experience as a manager at Panasonic Holdings Corporation, a company
that develops a wide variety of products globally, including home appliances, audio/visual equipment,
automotive products, industrial equipment, and information and telecommunications equipment, primarily on
diverse staff functions, including administrative divisions, and has contributed to the company’s businessgrowth and corporate value enhancement.
The Company’s Nomination Committee has judged that he will contribute significantly to the Company’s
management with regard to important issues such as new business and supervision of the entire Group, basedon his experience as a manager backed by his wide range of experience in the global manufacturing industry
and extensive knowledge of business administration, so it has nominated him as a candidate for Director.
There were transactions in the fiscal year 2023 between the HOYA Group and the Panasonic Group, which thecandidate comes from, but the amount involved in the transactions represents less than 0.1% of theconsolidated net sales of each party, and nothing in connection with the candidate exists that violates theindependence requirements for a Director candidate provided for in the “Basis for Election of Candidates for
Directors” set forth by the Nomination Committee of the Company.

Reference Material for the General Meeting of Shareholders

No.

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Apr. 1992
Feb. 2010
Sep. 2010
Jun. 2013
Jun. 2015
Mar. 2020

Eiichiro Ikeda

Mar. 2022(Born on Mar. 17, 1970)[Number of years in office of the
Director of the Company]
2 Years[Number of shares of theCompany held] 2,900 SharesBusiness Report

6[Number of attendances to theboard meetings] 10/10 times(100%)

Jun. 2022

Joined the Company
Co-CEO, Memory Disk Division of the Company
Head of Optical Lens of the Company
Executive Officer & Chief Operating Officer (COO) of theCompany
Executive Officer & Chief Operating Officer (COO),
Information Technology and Chief Technology Officer(CTO) of the Company
Executive Officer & Information Technology and Chief
Technology Officer (CTO) of the Company
Representative Executive Officer President & CEO of theCompany
Chief Representative of Singapore Branch of the Company(present post)
Director, Representative Executive Officer President &CEO (present post)(Important positions of other companies concurrently held)
None

Reason for the Selection of Candidate for Director
The above candidate has been leading the Group as Representative Executive Officer, President & CEO and
Director, and gives appropriate explanations and reports on strategies based on portfolio management atmeetings of the Board of Directors. He also supervises the execution of operations by other Executive Officers
and adequately fulfills his role as Executive Officer and Director.
The Company’s Nomination Committee has nominated him as a candidate for Director again this year, taking
into consideration his past performance as a Director.
Message to Shareholders from Candidate

Financial Statements

HOYA engages in portfolio management to operate multiple businesses in each of the Life Care andInformation Technology domains that support, “Vision,” “Health,” and “Information Society.” I recognize that
portfolio management of the entire Group, which can realize sustainable corporate growth, is the mostimportant issue in terms of my role as Group CEO. Amid the drastic changes in the business environment due
to the recent rapid fluctuations in the global situation, the executive side is required to accurately verify thegrowth potential, profitability, and risk of each business and to make decisions quickly. As CEO, I will steer theproper course and strive diligently to enhance the corporate value of the HOYA Group in order to live up to
the expectations and trust of our shareholders and other stakeholders.

11

Name

Brief history, positions and assignments at the Company,
and important positions of other companies concurrently held

Apr. 1996
Sep. 2002
Aug. 2004
Feb. 2007
Jul. 2007

Ryo Hirooka(Born on Jan. 14, 1974)[Number of years in office of the
Director of the Company]
2 Years

Jul. 2009
Jun. 2013
Jun. 2014
Jun. 2022

Joined The Sumitomo Trust and Banking Company,
Limited (present Sumitomo Mitsui Trust Bank, Limited)
Joined the Company
Financial Manager of HOYA HOLDINGS N.V.
(Netherlands)
Director of HOYA HOLDINGS N.V.
Director of HOYA HOLDINGS N.V., and President of HOYAHOLDINGS (Asia) B.V.
Deputy CFO of Netherlands Branch of the Company
Executive Officer & CFO of the Company
Representative Executive Officer & CFO
Director, Representative Executive Officer & CFO (present
post)

Reference Material for the General Meeting of Shareholders

No.

(Important positions of other companies concurrently held)
None[Number of shares of theCompany held] 9,700 Shares

7[Number of attendances to theboard meetings] 10/10 times(100%)

The above candidate has been leading the Group’s financial strategy as Representative Executive Officer &CFO and Director, implementing proactive and flexible measures with a focus on capital efficiency. In addition,
he has been explaining and reporting financial matters, including financial results, appropriately at meetings ofthe Board of Directors and results briefing sessions, and has been fulfilling his role as an Executive Officer andDirector.
The Company’s Nomination Committee has nominated him as a candidate for Director again this year, taking
into consideration his past performance as a Director.

Business Report

Reason for the Selection of Candidate for Director

Message to Shareholders from Candidate
Through portfolio management of businesses, I will strive to further enhance corporate value by maintaining
financial discipline and balancing long-term growth investments with timely returns to shareholders.
Amid major changes in global conditions, I am committed to adapt to those changes and addressing thechallenges we face in order to continue being a company that is needed by our many stakeholders andshareholders.

Financial Statements

12Reference Material for the General Meeting of Shareholders
Business Report
Financial Statements(Notes) 1.	‌Special interests between the candidates and the Company
No candidate has any special interest in the Company.
2. Reasons for the selection of candidates for Independent Director		‌A company-with-nomination committee, etc. has been adopted as a structure for its Board of Directors. The Company set up threecommittees, namely the Nomination Committee, Compensation Committee and Audit Committee, with the aim of securing managementtransparency and fairness and reinforcing supervisory functions. At the same time, the Company established a system that enables speedy
and efficient management by Executive Officers by a substantial transfer of authority from the Board of Directors to Executive Officers.
Independent Directors must comprise a majority at each of the three committees. The Articles of Incorporation of the Company prescribe that
half or more of its Directors must be Independent Directors, for the purpose of ensuring fairness. The reason for the selection of a candidate
for Independent Director is described separately for each candidate.
3.	‌Number of years in office of the Director of the Company for candidates		‌The number of years in office of Independent Director (up to the close of this General Meeting of Shareholders) is described separately foreach candidate.
4. Conclusion of limited liability agreements		‌The Company and each of the five candidates for reappointment as Independent Director have concluded an agreement that limits liabilities
for damages in Paragraph (1), Article 423 of the Companies Act to the higher of 10 million yen or the amount provided by Paragraph (1),Article 425 of the Companies Act.
		 When the reappointment of each person is approved and passed, the above liability limitation agreement will be continued.
5.	‌Conclusion of a directors and officers liability insurance contract		‌The Company has concluded a directors and officers liability insurance contract between an insurance company, as stipulated in Paragraph (1),Article 430-3 of the Companies Act, and plans to renew the contract under the same terms in the fiscal year 2024. Under this contract, theinsured persons are fully or partially compensated for damages (defense costs and compensation or settlement payments) incurred as aresult of assuming liability of the duties executed or receiving claim for such damages held accountable. However, this does not cover certain
events such as claims for damages for willful violation of laws and regulations. This contract mainly covers individuals executing importantduties, including Directors and Executive Officers of the Company, and Directors, etc. of the Company’s subsidiaries. The full amount of theinsurance premiums is borne by the Company. When a person subject to this insurance, including a Director of the Company, is appointed asa Director or others, they will be an insured person under the insurance contract.
6. Independent Directors
		‌The candidates for Independent Director not only meet the requirements for outside directors stipulated by the Companies Act but also meetthe “Basis for Election of Candidates for Directors” that the Nomination Committee of the Company has set out as requirements to ensure theindependence of candidates for Independent Director as described below. Therefore, the Nomination Committee has determined that thecandidates sufficiently secure independence as Independent Directors.
(Reference 1)
Outline of matters that violate requirements for independence of candidates for Independent Director<Those who are related to the HOYA Group>		 • Those who previously worked for the HOYA Group		 •	‌Those who have a family member (spouse, child or relatives by blood or by affinity within the second degree) who has held the position of
Director, Executive Officer, Corporate Auditor or top management of the HOYA Group in the past five years<Major shareholders>		 •	‌Those who are major shareholders (10% or more) of the HOYA Group, or those who are directors, executive officers, corporate auditors or
employees of companies that are major shareholders of the HOYA Group or those who have a family member who is a top management ofsuch companies		 • Those who execute operations of a company of which a major shareholder is the HOYA Group<Those who are related to big business partners>		 •	‌Those who are operating directors, executive officers or employees of any important business partner, either for the HOYA Group or the
corporate groups which the candidates come from, the sales to which business partner comprises 2% or more of the consolidated net salesof the HOYA Group or the company groups for either of the past three years, or those who have a family member who is a top managementof such business partner<Those who provide professional services (lawyers, certified public accountants, certified tax accountants, patent attorneys, judicial scriveners,etc.)>
		 •	‌Those who have received remuneration of 5 million yen or more per year or those who have a family member who has received
remuneration of 5 million yen or more per year, from the HOYA Group in the past three years		 •	‌When the organization which the candidate belongs to, such as a company and association, has received cash, etc. from the HOYA Group,
the amount of which exceeds 100 million yen per year or 2% of consolidated net sales of the said organization, whichever is higher<Donation, etc.>		 •	‌When the association or organization which the candidate belongs to as director or operating officer has received donations or grants in thepast three years, the amount of which exceeds 10 million yen per year or 30% of the said organization’s average annual total costs,
whichever is higher, or when the association or organization which the candidate’s family member belongs to has received donations or
grants equivalent to the aforementioned amount<Others>		 • When directors are exchanged		 • When the candidate has any other important interest in the HOYA Group(Reference 2)	‌As a company-with-nomination committee, etc., the Company’s Board of Directors plays a role as a monitoring board to maximize the corporate
value over the medium- to long-term. The Board of Directors supervises the management situation of executives and if necessary, need todecide on critical matters such as replacing the CEO. The Company considers that experience in top management is important for Independent
Directors to fulfill their function as a monitoring board, and that diversity in gender and skill sets is necessary to supervise management fromvarious viewpoints, as well as extensive insight and leadership to reflect such diverse viewpoints in management.

13

Definition

Reason for selection

Yoshihara

Abe

Hasegawa

Corporate
Management

Knowledge andexperience regarding
company management
and corresponding
corporate governanceTo sustain improvementin business performanceand growth, and thereby
enhance the corporate
value

●

●

●

Global BusinessKnowledge andexperience necessary for
global management andrelevant businessdevelopment

To promote management
respecting diverse
cultures and customs ineach region

●

●

●

Finance/
Accounting

Knowledge andexperience in thefinance/accounting
domainTo achieve financial
targets and increasetransparency tostakeholders●

Related industries/
businesses

Knowledge andexperience regarding
industries and businesses
associated with theCompany’s businesses

To promote management
based on anunderstanding of industry
trends, regulations, andtechnologies

●

●

M&A

Knowledge andexperience in M&A in
general, such as due
diligence and formulationof integration plans

To promote the Group’s
growth strategy throughthe implementation ofstrategic M&A●●

Sustainability/
ESG

Knowledge andunderstanding of trends
in the sustainability/ESG
area, and relevant
experience

To promote sustainable
management to realize asustainable society, andthereby enhance thecorporate value in themedium to long term●●

Risk management

Knowledge andexperience in the risk
management domain,
including legal
compliance, and supply
chain/quality control/ITsecurity

To continue to provide
products and services
stably and steadily to thesociety●●

Human resource
development

Knowledge andexperience regarding thehuman resources domain,such as cultivation ofhuman resources andleadership development

To promote management
focusing on humancapital●Nishimura

Sato

●

●

●

Reference Material for the General Meeting of Shareholders

Skill items

●

●

●

●

●

●

●

●

●

●

●

●

●

Business Report●

Financial Statements

14

Reference Material for the General Meeting of Shareholders

Business Report An attachment to the Notice of the 86th Ordinary
General Meeting of Shareholders (From April 1, 2023 to March 31, 2024)

Matters Relating to the Present State of the HOYA Group
Business Development and Results
Progression and result of businesses
General Overview:As of March 31, 2024, the HOYA Group consisted of the HOYA CORPORATION, 141 consolidated
subsidiaries (5 of which are domestic and 136 overseas) and 17 affiliates (5 of which are domestic andthe other 12 overseas).
The HOYA Group has adopted a business management structure where the Life Care and Information
Technology business segments control subsidiaries around the world based on their respective
responsibilities. Regional headquarters in the Americas, Europe and Asia support business operations bystrengthening relationships with countries and areas in the respective regions, such as by providing legal
support and conducting internal audits. The HOYA Group’s Financial Head Quarters (FHQ) is located at its

Business Report

Europe Regional Headquarters (the Netherlands).

<Adoption of the International Financial Reporting Standards>
Beginning from the 73rd fiscal year, the HOYA Group prepares its consolidated financial statements andother documents in compliance with the International Financial Reporting Standards (IFRS) pursuant to
the paragraph (1), Article 120 of the Ordinance on Company Accounting. With respect to reportablesegments presented in the overview of operation by business category, the HOYA Group divides its
business into three reportable segments, based on IFRS. These segments are Life Care, Information
Technology, and Other Businesses.
The Life Care segment deals in health care related products such as eyeglass lenses and contact lenses,
as well as medical related products such as intraocular lenses and medical endoscopes. The Information
Technology segment handles electronics related products such as mask blanks for semiconductors,
photomasks for flat-panel displays (FPDs) and glass substrates for hard disk drives (HDDs), and imaging
related products such as digital camera lenses. The Other Businesses segment offers mainly speech

Financial Statements

synthesis software, etc.

15

Sales (million yen)
661,466

723,582

The business results of the HOYA Group for the consolidated fiscal year
762,610

ended March 2024 are shown in the graph on the left. Although sales ofglass substrates for hard disk drives in the Information Technology business

547,921

were sluggish due to customers’ inventory adjustments and other factors,
both sales and profit increased in the Group as a whole due to solid
performance in the Life Care business and the effect of foreign exchange
conversion.

FY83rd
FY84th
FY85th
FY86th(Ended(Ended(Ended(EndedMarch 2021) March 2022) March 2023) March 2024)

Reference Material for the General Meeting of Shareholders<Sales and Profit>

We deeply apologize for the great inconvenience caused by the system
failure due to a cyberattack from a malicious third party, which occurredon March 30, 2024, to our shareholders, customers, business partners andmany other stakeholders.

Profit before tax (million yen)
Profit before tax ratio (%)
210,706 215,832

236,564

There were no discontinued operations in the consolidated fiscal year

159,218
31.9

29.1

29.8

31.0

ended March 2024 and the preceding consolidated fiscal year. Therefore,
continuing operations.

FY83rd
FY84th
FY85th
FY86th(Ended(Ended(Ended(EndedMarch 2021) March 2022) March 2023) March 2024)

Business Report

all numerical values and percentage changes herein are based on

Profit attributable to ownersof the Company (million yen)
Basic earnings per share (yen)181,377
164,507 168,638
125,446446.45 469.76

515.48335.77

FY83rd
FY84th
FY85th
FY86th(Ended(Ended(Ended(EndedMarch 2021) March 2022) March 2023) March 2024)

Financial Statements

16

Reference Material for the General Meeting of Shareholders<Financial Position>
Total assets at March 31, 2024 increased by 175,296 million yen from the

Total assets

Total equity (million yen)
1,203,623

end of the preceding consolidated fiscal year to 1,203,623 million yen.

992,839

Non-current assets increased by 28,817 million yen to 346,988 million yen.

853,290

This is primarily due to increases of 19,576 million yen in property, plant672,4121,028,326

962,264

789,056 814,604

and equipment–net, 5,924 million yen in goodwill and 3,098 million yen in
long-term financial assets.
Current assets increased by 146,479 million yen to 856,635 million yen.
This is primarily due to increases of 13,927 million yen in inventories and

FY83rd
FY84th
FY85th
FY86th(Ended(Ended(Ended(EndedMarch 2021) March 2022) March 2023) March 2024)

119,274 million yen in cash and cash equivalents despite a decrease of
1,142 million yen in other short-term financial assets.
Total equity increased by 147,660 million yen to 962,264 million yen. Thisis primarily due to profit for the year of 182,566 million yen and an increase

Equity attributable to ownersof the Company per share (yen)2,760.91

of 67,076 million yen in other comprehensive income despite decreases ofBusiness Report

56,052 million yen due to acquisition of treasury shares and 38,806 million

2,201.68

2,311.72

1,862.96

yen due to dividends from retained earnings.
Equity attributable to owners of the Company increased by 149,437 million
yen to 967,758 million yen.
Liabilities increased by 27,637 million yen to 241,359 million yen. This is
primarily due to increases of 4,593 million yen in interest-bearing long-term
debt, 3,149 million yen in trade and other payables, 7,898 million yen inother current liabilities, and 3,278 million yen in other long-term financial
liabilities, and 1,804 million yen in income tax payables.
The ratio of equity attributable to owners of the Company to total assets
at March 31, 2024 increased by 0.8 percentage points from the end of thepreceding consolidated fiscal year and reached to 80.4%, which was 79.6%
in the preceding consolidated fiscal year.
The breakdown of changes in retained earnings is presented later in thisFinancial Statements

report in the section for Consolidated Statement of Changes in Equity.

17

FY83rd
FY84th
FY85th
FY86th(Ended(Ended(Ended(EndedMarch 2021) March 2022) March 2023) March 2024)

SalesComposition

Life Care

MedicalOutline of consolidated results by business segment

Health Care related products
Sales of eyeglass lenses increased mainly due to strong sales in Japan andSales (million yen)overseas as a result of sales expansion of high value-added products and

Health Careother products.

407,549

Sales of contact lenses increased substantially. This was due to strong

107,726

online sales, as well as an increase in per-customer spending due to ourprovision of high value-added products and increased sales of private brand

299,823

Reference Material for the General Meeting of Shareholders

Health Care

Medical474,628
123,011351,617530,024
136,363

393,661

products (hoyaONE).
FY84th(EndedMarch 2022)

FY85th(EndedMarch 2023)

FY86th(EndedMarch 2024)

Sales of medical endoscopes increased due to progress with in-housestructural reforms and the effect of foreign exchange conversion, despitesome impacts of anti-corruption campaigns in China.
Sales of intraocular lenses for cataracts increased significantly due to a
global recovery in the number of cataract surgeries and launch of new

Profit before tax (million yen)
Profit before tax ratio (%)
120,971

86,269Business Report

Medical related products

94,319products.
In the other product lines of medical related products, sales increased

21.2

19.9

22.8

significantly due to strong sales of all major products, including artificial
bone products and chromatography carriers used in pharmaceuticals andother applications.

FY84th(EndedMarch 2022)

FY85th(EndedMarch 2023)

FY86th(EndedMarch 2024)

As a result, sales in the Life Care segment increased by 11.7% compared tothe preceding consolidated fiscal year to 530,024 million yen. Segment
profit increased by 28.3% to 120,971 million yen.

Financial Statements

18

Reference Material for the General Meeting of Shareholders

Electronics

Information
Technology

Sales
Composition

Imaging

Outline of consolidated results by business segment

Electronics related products
Sales of mask blanks for semiconductors decreased slightly due tocustomers’ inventory adjustments, despite our active R&D and our having
captured demand for embarking on mass production of leading-edge

Sales (million yen)
Electronics

248,403
38,677

Imaging244,338
36,140products including mask blanks for EUV (Extreme Ultraviolet) lithography.
Sales of photomasks for FPD decreased slightly mainly due to thereplacement of equipment at our factories, despite continued demand for

209,726

208,199

FY84th(EndedMarch 2022)

FY85th(EndedMarch 2023)

228,328
39,054

189,274

the development of high-performance displays for smartphones.

Business Report

Regarding glass substrates for hard disks, sales of mainly 3.5-inch substrates

FY86th(EndedMarch 2024)

decreased due to restraint of investment by data center end users as wellas inventory adjustments in the supply chain.
Profit before tax (million yen)
Profit before tax ratio (%)

Imaging related products
Sales of camera lenses increased due to firm sales of interchangeable

122,886

119,667

107,906

lenses on the back of increased demand for travels and the launch of new
mirrorless camera models.

49.5

48.9

47.1

As a result, sales in the Information Technology segment decreased by
6.6% compared to the preceding consolidated fiscal year to 228,328

Financial Statements

million yen, and segment profit decreased by 9.8% to 107,906 million yen.

19

FY84th(EndedMarch 2022)

FY85th(EndedMarch 2023)

FY86th(EndedMarch 2024)

The total capital expenditures of all operations of the HOYA Group amounted to 56,947 million yen during the consolidated fiscal year
ended March 2024. This is an increase of 13,479 million yen over the preceding consolidated fiscal year.
In the consolidated fiscal year ended March 2024, investment in the Life Care business amounted to 37,039 million yen and investmentin the Information Technology business amounted to 19,801 million yen, which accounted for 65% and 35% of the total capital
expenditures by the Group, respectively.
The investment was covered by internally generated funds.
During the consolidated fiscal year ended March 2024, in the Life Care business, the HOYA Group mainly invested in increasing
production of eyeglass lenses.
In the Information Technology business, we made investments mainly to increase production of mask blanks for semiconductors andphotomasks for FPD.

Category

84th Fiscal Year(Ended March 2022)

Capital expenditures (million yen)

85th Fiscal Year(Ended March 2023)

34,43543,468Reference Material for the General Meeting of Shareholders

View of Capital Expenditures

86th Fiscal Year(Ended March 2024)
56,947

Financing
There are no relevant items.

Important Corporate Reorganizations, etc.
Business Report

There are no relevant items.

Financial Statements

20Reference Material for the General Meeting of Shareholders

Management Issues Requiring Actions
The HOYA Group globally promotes the operation of a number of businesses in “Life Care” and “Information Technology” in order toachieve sustainable growth and maximize its corporate value. While operating diverse range of businesses, the HOYA Groupmaximizes its competitiveness by optimally allocating management resources and endeavors to improve results.
(1) Target management indicators
The HOYA Group believes that corporate value will increase and stakeholders will be satisfied when profit exceeds the cost of capital.
In order to achieve this, we have introduced Shareholders Value Added (SVA) as a management indicator, and we strive for efficientmanagement.
(2) Medium-to-long term corporate management strategy and issues requiring actions(i) Speedy and flexible response to changes in the market and efficient utilization of management resources
In the manifold business areas of the HOYA Group, we will increase the speed of decision making by broadly delegating authority tobusiness divisions, and devise strategies that are in line with customer needs ahead of the competition. We will allocate management
resources of the Group appropriately and will make timely decisions regarding plant and equipment investment, business alliances,mergers and acquisitions, withdrawal from or reduction in business operations, etc.

Business Report(ii) Creation of new business and technologies
To secure earnings and continue to grow, the HOYA Group realizes that it is critical to acquire new businesses and technologies
through in-house development and M&A in growth areas different from the existing ones. Going forward, we will devote even greater
resources to acquiring world-class technologies and businesses that have a significant competitive advantage through in-housedevelopment and M&A; and to hiring and training personnel able to support our technologies and businesses.
(iii) Business expansion in growth markets
The population of those in need of eyesight correction continues to grow due to the aging of society globally and declining visualacuity in younger people due to the use of digital devices for long periods of time. The reduction of fatigue and shortening of time for
medical treatment are demands by both physicians and patients, and minimally invasive treatment has been spreading at an accelerated
pace. In addition, the development of high-performance, power-saving semiconductors and investment in data centers are being driven
by the progress of the information society. In this context, the HOYA Group has positioned products that support people’s visualacuity and health, and the progress of the information society as growth areas. We will invest management resources aggressively inthese areas to expand our business.

Financial Statements(iv) Response to cyber security
In line with developments in generative AI and other information technologies, as well as the spread of various IT tools, theimportance of cyber security initiatives for companies is increasing. At the same time, cyber security threats are constantly evolving.
To respond to this environment, at the HOYA Group, we are engaged in continuous efforts to reinforce our cyber security.
(v) Response to sustainability (ESG)
At the HOYA Group, we have positioned our response to sustainability and ESG requirements as an important management issue, andthe CSO, who has been delegated by the CEO, is leading the promotion of sustainability and ESG activities of the entire Group. Basic
policies and important measures are put together by the ESG Promotion Office within the Group Headquarters, and progress isregularly reported to the Board of Directors via the CSO. To ensure the Board of Directors can exercise its supervisory functions for
management and maintain an objective standpoint, in the consolidated fiscal year ended March 2024, five of the seven Directors were
Independent Directors. In addition to individuals with a global mindset and a wealth of management experience, the Independent
Directors are made up of individuals with backgrounds in personnel development and diversity from a sustainability and ESG
standpoint, and with management experience of important decision making in climate change. From multifaceted perspectives, theBoard of Directors provides advice and supervision on policies and targets related to sustainability and ESG measures, importantmatters including budgets, and regular reports.
In this fiscal year, we increased the proportion of ESG target*1 attainment, which is one of the indicators in Executive Officers’
medium- to long-term incentives (Performance Share Unit), from 10% to 25%, thus showing our companywide commitment topromoting ESG initiatives. In addition, each business division sets its own climate change response and ESG-related targets specific toeach business division, and we are enhancing the effectiveness of our ESG management by newly incorporating such targets into KPIs
for remuneration for each president of business divisions.
*1 Targets are set based on external evaluations and status of initiatives related to ESG themes such as climate change and human capital.

21

Fiscal 2021

Fiscal 2030

Fiscal 2040

Renewable-energy
usage rate

Target renewable-energy
usage rate:60%

Target renewable-energy
usage rate:100%

CO₂
emissions volume

CO₂
emissions volume

CO₂
emissions volume522,000t

-60%

-100%

Reference Material for the General Meeting of Shareholders[Medium- to long-term renewable energy ratio and CO2 reduction targets]
HOYA joined RE100*2 in February 2023, setting targets to use exclusively electricity from renewable energy sources in its businessactivities and to achieve a 100% reduction in CO2 emissions compared to fiscal 2021 by 2040. In addition to further promoting theenergy-saving activities we have rolled out to date, we will strive to reduce our CO2 emissions through introducing renewable energy
by implementing solar power generation equipment at our production sites, switching to green energy plans, and in other ways.
*2 ‌A global initiative to ensure that companies commit to sourcing 100% of the electricity used across their operations with electricity
from renewable energy sources.

Solar panels installed at HOYA
Optical Technology (Weihai) Co., Ltd.
(annual generating capacity: 1,300
MWh; reduction in annual CO2
emissions: about 800 t-CO2)

For details of our sustainability initiatives, please visit our website (https://www.hoya.com/en/).

Business Report
Financial Statements

22

Reference Material for the General Meeting of Shareholders

Changes in the State of Assets, Profits and Losses
Overview of Assets, Profits and Losses of the HOYA GroupClassification

84th Fiscal Year(Ended March 2022)[IFRS]

85th Fiscal Year(Ended March 2023)[IFRS]

86th Fiscal Year
(Current fiscal year)(Ended March 2024)[IFRS]

Sales(million yen)

547,921661,466

723,582

762,610

Profit before tax(million yen)

159,218

210,706

215,832

236,564

Profit for the year

(million yen)

125,221

165,322

168,788

182,566

Profit attributable toowners of the Company(million yen)

125,446

164,507

168,638

181,377335.77446.45469.76515.48

Basic earnings per share(yen)

Total assets(million yen)853,290992,839

1,028,326

1,203,623

Total equity(million yen)

672,412

789,056

814,604

962,264

1,862.96

2,201.68

2,311.72

2,760.91

Equity attributable toowners of the Company
per share

Business Report

83rd Fiscal Year(Ended March 2021)[IFRS](yen)(Notes)1.	‌Starting from the 73rd fiscal year, the HOYA Group prepares its consolidated financial statements in accordance with the International Financial
Reporting Standards pursuant to the paragraph (1), Article 120 of the Ordinance on Company Accounting.
2.	‌The amounts of sales and profit before tax present only the amounts for continuing operations. The amount of profit for the year presents the amountof all operations including discontinued operations.
3.	‌Basic earnings per share is computed, based on the average of the total number of the outstanding shares during the consolidated fiscal year. Equity
attributable to owners of the Company per share is computed, based on the total number of shares outstanding as of the end of consolidated fiscal
year. The figures for the total number of outstanding shares exclude treasury shares.
4.	‌The overview of the 86th fiscal year (consolidated fiscal year ended March 2024) is presented in the above section of this report titled “Progression
and result of businesses.”

Important Subsidiaries
Capital stock

Voting rights ownedby the Company

HOYA HOLDINGS, INC.
(USA)

16,204 thousands of
U.S. dollar

100.0%

Regional headquarters in America

HOYA HOLDINGS N.V.(The Netherlands)

9,930 thousands of
euro

100.0%

Holding company in Europe, controllingthe distribution and sale of eyeglass
lenses in Europe

HOYA HOLDINGS (ASIA) B.V.
(The Netherlands)

19 thousands of
euro

100.0%

Holding company in Asia

HOYA HOLDINGS ASIA PACIFIC PTE LTD(Singapore)

54,326 thousands of
U.S. dollar

100.0%(100.0%)Regional headquarters in Asia andOceania

Company nameMain business

Financial Statements(Note) The figure appearing in a bracket in the column entitled “Voting rights owned by the Company” represents indirect ownership.

23

The HOYA Group has established two business domains in its management principle. They are “Life and Culture” and “Information
Technology.” In order to realize a continuous increase in the corporate value in each of the business domains, the Group makes
decisions on management resource allocations and monitors their business performance. The major businesses of the HOYA Group
can thus be broken down roughly to Life Care business and Information Technology business.
The Life Care segment manufactures and sells health care related products that are used routinely in medical treatment and healthmaintenance fields, and medical related products that include medical equipment and medical supplies used in medical treatment.
Some unique features of this business segment are that approvals and permits are required from relevant authorities in each country
and that advanced technological strength and reliable quality control systems are the key requirements.
The Information Technology segment manufactures and sells essential items for digital devices. Included are electronics related
products that are indispensable for today’s digital information and communication technology, and imaging related products that use

Reference Material for the General Meeting of Shareholders

Major Businesses (as of March 31, 2024)

optics technology and are necessary to capture images as digital data.
The major products and services handled by each division are as follows:Business segment
Life Care

Information
Technology

Major products and services

Health Care related
products

Eyeglass lenses, Contact lenses

Medical related
products

Medical endoscopes, Medical accessories, Automated endoscope reprocessors (AERs),
Intraocular lenses, Ophthalmic medical devices, Artificial bone, Metallic orthopedic
implants, chromatography carriersElectronics related
products

Photomasks and Mask blanks for semiconductors, Photomasks for FPD, Glass disk
substrates for hard disk drives (HDDs)

Imaging related
products

Optical lenses, Optical glass material, Laser equipment, Light source
Speech synthesis software

Business Report

Other

Business category

Financial Statements

24

Reference Material for the General Meeting of Shareholders

Head Office, Principal Places of Business and Plants (as of March 31, 2024)(1) HOYA CORPORATION
Segment
Corporate

Life Care

Information
Technology

Name

LocationGroup Headquarters

Shinjuku-ku, Tokyo

Netherlands Branch

The Netherlands

Singapore Branch

Singapore

Vision Care Company, Japan Headquarters

Nakano-ku, Tokyo

Eye Care Company

Nakano-ku, Tokyo

Medical Division, Japan Headquarters

Nakano-ku, Tokyo

Showa-no-mori Office

Akishima-shi, TokyoLSI Division and other Divisions’ Sales Departments

Shinjuku-ku, Tokyo

Nagasaka Office

Hokuto-shi, Yamanashi

Hachioji Factory

Hachioji-shi, Tokyo

Akishima Factory

Akishima-shi, Tokyo(2) Subsidiaries
Segment

Business Report

Life Care

Information
Technology

Location

HOYA LENS DEUTSCHLAND GMBH

Germany

HOYA OPTICAL LABS OF AMERICA, INC.

USA

HOYA LENS THAILAND LTD.

ThailandHOYA LAMPHUN LTD.

Thailand

PENTAX OF AMERICA, INC.

USA

PENTAX EUROPE GMBH

Germany

HOYA CORPORATION USA

USAHOYA ELECTRONICS SINGAPORE PTE. LTD.

Singapore

HOYA GLASS DISK VIETNAM LTD.

Vietnam

HOYA OPTICAL TECHNOLOGY (WEIHAI) CO., LTD.

China

HOYA OPTICS (THAILAND) LTD.

ThailandHOYA HOLDINGS, INC.

USA

HOYA HOLDINGS N. V.

The Netherlands

HOYA HOLDINGS (ASIA) B. V.

The Netherlands

HOYA HOLDINGS ASIA PACIFIC PTE LTD

Singapore

Financial Statements

Corporate

Name

25

(1) By segment
Number of employees

Year-on-year comparison
at year end

Life Care

24,561

up 1,198

Information Technology

10,811

down 2,028

Other

215

up 44

Corporate

115

up 5

35,702

down 869

Segment

Total(2) Changes in the number of employees
Category

83rd Fiscal Year(Ended March 2021)

84th Fiscal Year(Ended March 2022)

85th Fiscal Year(Ended March 2023)

86th Fiscal Year(Ended March 2024)

Overseas33,80535,01033,20732,300

Japan

3,440

3,366

3,364

3,402

Reference Material for the General Meeting of Shareholders

Employees (as of March 31, 2024)(Notes)1. The number of employees represents regular employees of all operations. Temporary and contract workers are excluded.
2. The Corporate figure represents the number of employees in the Group Headquarters and overseas regional headquarters and branches.
3.	‌Employees at HOYA CORPORATION numbered 3,042 (up 21 YOY). Their ages and service periods averaged 47.8 and 19.7 years,
respectively.

Major Lenders (as of March 31, 2024)
LenderLoans payable

Jiangsu Sigo Management Consulting Co., Ltd.

521 million yen

SUMITOMO MITSUI BANKING CORPORATION (CHINA) LIMITED

408 million yen

AGRICULTURAL BANK OF CHINA LIMITED

326 million yen

Seiko Holdings Corporation

255 million yen

Business Report

1,039 million yen

GRAND QUANTUM INVESTMENT CORPORATION LIMITED

Other Important Matters concerning the HOYA Group
There are no relevant items.

Financial Statements

26

Reference Material for the General Meeting of Shareholders
Business Report

Current State of the Company
State of Shares (as of March 31, 2024)(1) Total number of shares the Company authorized:

Common share

1,250,519,400 shares(2) Total number of issued shares:

Common share

350,958,720 shares(Note) ‌The total number of issued shares decreased by 6,001,800 shares compared to the end of the previous fiscal year due to thecancellation of treasury shares implemented on May 17, 2023 and November 10, 2023.
(3) Number of shareholders:		

24,945(4) Number of shares constituting one unit:		

100 shares(Down 1,544 YOY)

(5) Principal shareholders: (Top 10 shareholders)
Rank

Number ofsharesName

Percentage ofinvestment(Hundred shares)

1

The Master Trust Bank of Japan, Ltd. (Trust Account)652,155

18.60

2

Custody Bank of Japan, Ltd. (Trust Account)

238,086

6.79

3

SSBTC Client Omnibus Account109,760

3.13

4

Deutsche Bank Trust Company Americas

74,1402.11

5State Street Bank West Client - Treaty 505234

71,510

2.04

6

JP Morgan Chase Bank 385632

63,471

1.81

7

BNYM AS AGT/CLTS NON TREATY JASDEC

58,9901.68

8Government of Norway

58,141

1.65

9

JP Morgan Chase Bank 385781

47,487

1.35

10Clearstream Banking S.A.

46,0491.31%(Notes)1.	‌In consideration of the number of voting rights, the numbers of shares are stated in units of one hundred shares and the shares that do notconstitute one trading unit are rounded down.
2. The percentage of investment is calculated by excluding treasury shares (437,245 shares).

(6) ‌Number of shares issued in this fiscal year to the Directors and Executive Officers of the Company as remuneration for
their duty execution
Number of shares issued
Directors and Executive Officers(excluding Independent Directors)
Independent Directors

Number of Directors andExecutive Officers issued
with shares

3,200

2

400

2

(Notes)1.	‌Information on the Company’s share-based remuneration is provided in the “Remuneration, etc. for the Directors andExecutive Officers of the Company” section of the Business Report.
2.	‌The above includes the number of shares issued to the Directors and Executive Officers of the Company who haveresigned.

(7) Other important matters regarding shares
Financial Statements

A resolution was made at the Board of Directors meeting held on May 15, 2024, on matters pertaining to a share
repurchase as follows.
Total number of shares to be repurchased (maximum):3.0 million shares

Total amount to be paid for repurchase (maximum):50.0 billion yen

Period of share repurchase:May 16, 2024 through August 15, 202427

(1) Directors and Executive Officers (as of March 31, 2024)
Position and role at the Company

Important positions of other organization concurrently held

Hiroaki Yoshihara

Director
Chairperson of the Audit Committee
Member of the Nomination
Committee
Member of the Compensation
Committee

Outside Director of Hitachi, Ltd.

Yasuyuki Abe

Director
Chairperson of the Nomination
Committee
Member of the Compensation
Committee
Member of the Audit Committee

Outside Director of SUBARU CORPORATION (scheduled
to retire the position in June 2024)

Takayo Hasegawa

Director
Member of the Nomination
Committee
Member of the Compensation
Committee
Member of the Audit Committee

Representative Director CEO of SWCC Corporation

Mika Nishimura

Director
Member of the Nomination
Committee
Member of the Compensation
Committee
Member of the Audit Committee

Operational Partner of GILDE HEALTHCARE PARTNERS

Mototsugu Sato

Director
Chairperson of the Compensation
Committee
Member of the Nomination
Committee
Member of the Audit Committee

Representative Director, Executive Vice President ofPanasonic Holdings Corporation
Representative Director, Member of the Board, President andChief Executive Officer (CEO) of Panasonic Operational
Excellence Co., Ltd.

Eiichiro Ikeda

Director, Representative Executive
Officer President & CEO

Ryo Hirooka

Director, Representative Executive
Officer & CFO

Tomoko Nakagawa

Executive Officer, Chief
Sustainability Officer (CSO)

Business Report

Name

Reference Material for the General Meeting of Shareholders

Directors and Executive Officers of the Company(Notes)1.	‌Directors Mr. Hiroaki Yoshihara, Mr. Yasuyuki Abe, Ms. Takayo Hasegawa, Ms. Mika Nishimura and Mr. Mototsugu Sato are all
Independent Directors as designated in item (15), Article 2 of the Companies Act.
2.	‌Members of the Audit Committee have more than sufficient experience in either finance or accounting having served for several years ascompany leaders. In particular, Director Mr. Yoshihara has long-term experience as an expert in finance and accounting at an international
accounting firm.
3.	‌At the Company, the Audit Committee Office, which supports members of the Audit Committee, was established; under that the Internal
Audit Department was established, and staff is assigned to both. Because the Company believes that members of the Audit Committee
adequately fulfill their responsibilities by receiving regular reports from the Internal Audit Department, through the Audit Committee
Office, putting effort into information gathering, and so forth, we do not have a full-time member of Audit Committee.
4.	‌Ms. Tomoko Nakagawa’s name in the family register is Tomoko Yamashita.

Financial Statements

28

Reference Material for the General Meeting of Shareholders(2) Independent Directors as stipulated at Tokyo Stock Exchange
The Company provided notice on Mr. Hiroaki Yoshihara, Mr. Yasuyuki Abe, Ms. Takayo Hasegawa, Ms. Mika Nishimura and Mr.
Mototsugu Sato to the Tokyo Stock Exchange as being independent directors appointed by the Company, in accordance with theTokyo Stock Exchanges rules and regulations.
(3) Independent Directors(i)	‌Important positions and roles concurrently held by the Company’s Independent Directors at other organization and theirrelationship with the Company is shown in “(1) Directors and Executive Officers” above. There is no important business
transactions relationship between the Company and each of any other organization.
(ii)	‌Attendance at Board of Directors Meetings and other Committee Meetings (Number of meetings attended/Number of
meetings held)
Name

Board of Directors
MeetingNomination
Committee

Compensation
Committee

Audit Committee

Hiroaki Yoshihara

10/10(100%)

6/6(100%)

8/8(100%)

9/9(100%)

Yasuyuki Abe

10/10(100%)

6/6(100%)

8/8(100%)

9/9(100%)

Takayo Hasegawa

10/10(100%)

6/6(100%)

8/8(100%)

9/9(100%)

Mika Nishimura

10/10(100%)

6/6(100%)

8/8(100%)

9/9(100%)

Mototsugu Sato

8/8

(100%)

5/5(100%)

6/6(100%)

8/8(100%)

Financial Statements

Business Report(Note)For Mr. Mototsugu Sato, only Board of Directors Meetings and Committee Meetings held since his appointment on June 23, 2023 areincluded.

29

Yasuyuki Abe

Mr. Abe made useful contributions to the discussion of items on the agenda, utilizing his experience at a
trading company and knowledge accumulated as a manager, as well as his experience as an Independent
Director at other companies.
As an Independent Director, he made remarks from an objective and impartial position as the occasion
required, and fulfilled his role in terms of management supervision. Furthermore, as the Chairperson of
the Nomination Committee, in addition to leading discussions of propositions to make Committee
decisions concerning the selection of Director candidates and the CEO succession plan, he actively
stated his opinions at the Nomination Committee and the Audit Committee, contributing to the lively
deliberations.

Takayo Hasegawa

Ms. Hasegawa made useful contributions to the discussion of items on the agenda, based on her
substantial management experience and expertise.
In particular, she uses her viewpoint as an active manager with an engineering background to makeremarks on all aspects of management, including the areas of manufacturing and technologicaldevelopment, from an objective and impartial position as an Independent Director, and fulfilled her rolein terms of management supervision. Furthermore, she actively stated her opinions at the Nomination
Committee, the Compensation Committee, and the Audit Committee, contributing to the lively
deliberations at the committees.

Mika Nishimura

Ms. Nishimura made useful contributions to the discussion of items on the agenda, based on her
substantial knowledge and experience as an expert in M&A and medical fields.
In particular, based on her global knowledge in the medical field, she made active remarks oncompliance in the medical technology field, and fulfilled her role in terms of management supervision.
Furthermore, she actively stated her opinions at the Nomination Committee, the Compensation
Committee, and the Audit Committee, contributing to the lively deliberations at the committees.

Mototsugu Sato

Mr. Sato made useful contributions to the discussion of items on the agenda, based on his substantial
management experience and expertise gained at a comprehensive electronics manufacturer offering
diverse products on a global scale.
In particular, he used his extensive experience as an active manager in diverse staff functions, including
administrative divisions, to make appropriate remarks as required from objective and impartial position
as an Independent Director, thus fulfilling his role in terms of management supervision. Further, as the
Chairperson of the Compensation Committee, he led discussions of propositions to make Committee
decisions concerning the remuneration system for Directors, a remuneration system that raises Executive
Officers’ incentives, and fair and appropriate performance evaluation.

Business Report

Hiroaki Yoshihara

Mr. Yoshihara made useful contributions to the discussion of items on the agenda, based on his
substantial knowledge and experience as a finance and accounting expert as well as management
experience gained at an international accounting firm.
As an Independent Director, he made remarks from an objective and impartial position as the occasion
required, and fulfilled his role in terms of management supervision. In particular, he provided
considerable advice with regard to evaluating M&A targets and assessing market conditions from a
global perspective, and proactively voiced his opinions concerning the Company’s portfolio in the
future. Furthermore, as the Chairperson of the Audit Committee, he led discussions of propositions tomake Committee decisions concerning the verification of financial statements, the monitoring of internal
control systems, and audits of operations and assets. Additionally, he led discussions as the Lead
Independent Director at meetings attended only by Independent Directors (executive sessions) andadvised Representative Executive Officers based on the outcomes of those sessions.

Reference Material for the General Meeting of Shareholders(iii) Major activities at the Board of Directors Meetings and other Committee Meetings during the Fiscal Year
Overview of major activities and duties carried out by
Name
Independent Directors in relation to the role expected of them(iv) Overview of liability limitation contract
The Company and its Independent Directors have concluded an agreement that limits possible future liabilities of the latterprescribed in paragraph (1), Article 423 of the Companies Act to the higher of 10 million yen or the amount prescribed by theparagraph (1) of Article 425 of the Act.

30

Financial Statements(v) Overview of the directors and officers liability insurance contract
The Company has concluded a directors and officers liability insurance contract with an insurance company, as stipulated inparagraph (1), Article 430-3 of the Companies Act. Under this contract, the insured persons are fully or partially compensatedfor damages (defense costs and compensation or settlement payments) incurred while taking responsibility or being held
accountable for the execution of their duties. However, it does not cover damages incurred for certain reasons, such as damage
claims resulting from intentional violations of laws and regulations.
This contract mainly covers individuals executing important duties, including Directors and Executive Officers of theCompany, and Directors, etc. of the Company’s subsidiaries.

Reference Material for the General Meeting of Shareholders

Remuneration, etc. for the Directors and Executive Officers of the Company
	‌(1) Policy of the Compensation Committee for determining the amount of remuneration and other benefits received by Directors
and Executive Officers and details of the policy(i)Basic policy and determination method
The Company has established the Compensation Committee with the objective of “contributing to improvement of results of
the Company by constructing a remuneration system that raises motivation among Directors and Executive Officers and by
appraising their performance appropriately.” The Compensation Committee is made up of all of 5 Directors who are not
Executive Officers of the Company. With due consideration of necessary information (including the levels set by othercompanies as determined by a survey conducted by an outside professional organization), the Compensation Committee
discusses and finalizes policies for the remuneration of Directors and Executive Officers, and the particulars of remuneration
received by Directors and Executive Officers.

(ii)

Policy concerning remuneration for Directors

The remuneration of Directors consists of a fixed salary and a medium- and long-term incentive (restricted stock unit (“RSU”)).
The fixed salaries consist of a basic compensation and compensation for being a member or a chairperson of the Nomination,
Compensation or Audit Committee. The compensation levels are set appropriately by taking into consideration such factors as
the Company’s business environment, the levels set by other companies as determined by a survey conducted by an outside
professional organization, and the office and responsibility of each Director.
The RSU is a plan which the Company has introduced in place of stock options since fiscal 2022 and which delivers sharesprescribed in accordance with the period employed as an Independent Director of the Company. Its purpose is for Directors toBusiness Reportshare a common viewpoint with shareholders regarding the share price and to share interests with shareholders on a mediumto long-term basis.
The Compensation Committee reviewed the compensation levels and composition again this fiscal year based on the basic
policy, the Company’s business environment, and the levels set by other companies as determined by a survey conducted by anoutside professional organization. Upon confirming that the composition aligns with the policies of the Company and that thelevels are appropriate for each office and responsibility, the compensation of each Director was determined and thecompensation for each individual this fiscal year has been deemed to align with the policies of the Company.
The RSU will be granted annually in order for Directors to share a common viewpoint with shareholders regarding the shareprice and to share interests with shareholders on a medium- to long-term basis. Every year, the Company announces a basic
deliverable number of shares equivalent to fixed remuneration to Independent Directors for a three-year period from that year.
After the end of the period in question, the Company determines, for each Independent Director, a basic compensation amountwhich is the market value of the Company’s shares for the basic deliverable number of shares. The Company will pay to the
Independent Directors 50% of the basic compensation amount as claims for monetary remuneration. Independent Directors
shall invest the monetary claims in kind and shall be granted a number of Company shares, which is equal to the amount ofmonetary claims in question divided by paid-in amount per Company share. From the viewpoint of ensuring payment of tax,
the Company shall pay the remainder of the basic compensation amount in cash. However, the heirs of Independent Directors

Financial Statements

who died during their tenure and Independent Directors who retire due to injury or illness shall receive the entire basic
compensation amount in cash. Also, the Company plans to issue RSU for periods of three years starting from the following
fiscal year, and continuing thereafter.

31

Fixed salary: medium- and long-term incentive (RSU) =Approximately 1:1(Notes) 1.	‌Assuming a share price in three years roughly equivalent to the share price when the RSU was granted.
2.	‌Malus and clawback clause: If the case falls under any of the following items, the Company shall reduce or notprovide the unpaid portion of compensation based on the RSU, and may demand return of all or part of the portion
that has already been paid.
(i) Case where the recipient voluntarily retired from office regardless of his or her reason, (ii) case where the recipient
was dismissed as Director of the Company, (iii) a subsequent correction to financial statements due to a material
accounting error or fraud was resolved at the Board of Directors meeting, and (iv) the recipient’s gross negligence ofduty, or misconduct such as violation of law, violation of internal regulations or material breach of contracts during
his or her service was revealed.

(iii)

Policy concerning remuneration for Executive Officers

Reference Material for the General Meeting of Shareholders[Future composition ratio of remuneration]

The remuneration of Executive Officers consists of a fixed salary, an annual incentive (performance-based bonuses) and a
medium- and long-term incentive (performance share unit, “PSU”). For fixed salaries, basic compensation according to theoffice and responsibility of each Executive Officer (Representative Executive Officer, CFO, etc.) and, in case of expatriates,
benefit as expatriate (such as housing) are set appropriately by taking into consideration such factors as the offices andresponsibilities, the Company’s business environment, and the levels set by other companies as determined by a survey
conducted by an outside professional organization.
Performance-based bonuses shall be determined according to quantitative results and qualitative evaluations, and shall range
roughly from 0 to 200%. As indicators of quantitative results, sales, profit attributable to owners of the Company, and basic
earnings per share (EPS) given on the Consolidated Financial Statements are selected.
proportion to the level of achievement of the predetermined performance conditions.
The payment ratio that corresponds to the level of achievement of the performance targets will range from 0 to 200%, based on
the performance over three fiscal-year periods. The Company selected the indicators of sales over three fiscal-year periods,
basic earnings per share (EPS) and ROE given on the Consolidated Financial Statements.
Details of performance-based remuneration for Executive Officers are given in “Outline of performance-based remuneration

Business Report

PSU, which has been adopted in place of stock options from fiscal 2019, is a system for granting shares at a number that is in(annual incentive and medium- and long-term incentive) for Executive Officers” below.
The Compensation Committee reviewed the compensation levels and composition again this fiscal year based on the basic
policy, the Company’s business environment, and the levels set by other companies as determined by a survey conducted by anoutside professional organization. Upon confirming that the composition aligns with the policies of the Company and that thelevels are appropriate for each office and responsibility, the compensation of each Director was determined and thecompensation for each individual this fiscal year has been deemed to align with the policies of the Company.
[Composition ratio of remuneration]
Fixed salary: annual incentive (performance-based bonuses): medium-CEOand long-term incentive (PSU) = Approximately 1:1:1.25

Executive Officers excluding CEO

Fixed salary: annual incentive (performance-based bonuses): mediumand long-term incentive (PSU) = Approximately 1:1:1

share price when the PSU was granted.
2.	‌Malus and clawback clause: If the case falls under any of the following items, the Company shall reduce or notprovide the unpaid portion of compensation based on the PSU, and may demand to return of all or part of the portion
that has already been paid.
(i) Case where the recipient voluntarily retired from office regardless of his or her reason, (ii) case where the recipient
was dismissed as Director of the Company, (iii) a subsequent correction to financial statements due to a material
accounting error or fraud was resolved at the Board of Directors meeting, and (iv) the recipient’s gross negligence ofduty, or misconduct such as violation of law, violation of internal regulations or material breach of contracts during
his or her service was revealed.

32

Financial Statements(Notes) 1.	‌Subject to a 100% achievement rate for all targets and assuming a share price in three years roughly equivalent to theReference Material for the General Meeting of Shareholders[Outline of performance-based remuneration (annual incentive and medium- and long-term incentive) for Executive
Officers]a.

Annual incentive (performance-based bonuses)
Annual incentive (performance-based bonuses) shall be paid based on the following calculation.
A‌mount of annual incentive (performance-based bonuses) = base amount (according to the office of each officer)
x performance-linked coefficient (linked to quantitative targets)* x 80% + base amount (according to the officeof each officer) x performance-linked coefficient (linked to qualitative targets)* x 20%* Performance-linked coefficient shall range from roughly 0 to 200%.

[Performance-linked coefficient (performance-based bonuses)]
Indicators

TargetActual(consolidated)(consolidated)

Sales(Billions of yen)

Selected as an indicator for its measurement of
715.5

762.6 the Group’s degree of growth in domestic andoverseas markets.

Profit attributable toowners of the Company

Selected as an indicator for its measurement of
162.4

181.4 whether the Group’s growth is accompanied by(Billions of yen)
Business Report

Basic earnings per share(Yen)

Reason for selection

solid profits.
Selected as an indicator for its measurement of
452.26515.48 the Company’s degree of growth from ashareholder’s perspective.

(Notes)1.	‌The qualitative assessment method relevant to an annual incentive (performance-based bonuses) involves assessments ofitems such as the degree of achievement of budget targets in the division under management, the results of which aredeliberated on in the Compensation Committee before a decision is made.
2.	‌The target values in the table above are set taking into consideration such as the Company’s business environment, and assuch may differ from performance forecasts.

b.

Medium- and long-term incentive (PSU)
Every year, the Company announces basic deliverable numbers of shares according to the office and responsibility ofeach Executive Officer and medium- to long-term performance targets for a three-year period from that year. After theend of the period in question, the Company determines, for each Executive Officer, a basic compensation amount whichis the market value of the Company’s shares for the basic deliverable number of shares multiplied by a coefficient
representing the degree of achievement of medium- to long-term performance targets. The Company shall pay the
Executive Officer 50% of the basic compensation amount as claims for monetary remuneration. Executive Officers shallinvest the monetary claims in kind and shall be granted a number of Company shares, which is equal to the amount of

Financial Statements

monetary claim in question divided by paid-in amount per Company share. From the viewpoint of ensuring payment oftax, the Company shall pay the remainder of the basic compensation amount in cash.
However, Executive Officers not residing within Japan and the heirs of Executive Officers who died during their tenure
shall receive the entire basic compensation amount in cash.
Also, the Company plans to issue PSU for periods of three fiscal years starting from the following fiscal year, andcontinuing thereafter. Below is a table illustrating this system.

33

2022

2023

2024

PSU

2025

2026

2027

Granting ofshares, etc.

PSU

Granting ofshares, etc.

PSU

Granting ofshares, etc.

PSU

Reference Material for the General Meeting of Shareholders

2021

Granting ofshares, etc.

[Performance-linked coefficient (PSU)]
Fiscal 2021 allocation (target period: fiscal year ended March 2022 to fiscal year ended March 2024)
TargetActual(consolidated)(consolidated)

Reason for selection
Selected as an indicator for its measurement of

Sales(Billions of yen)

670.0

715.9 the Group’s degree of growth in domestic andoverseas markets.
Selected as an indicator for its measurement of

Basic earnings per share

430

(Yen)

Business Report

Indicators

477 the Company’s degree of growth from ashareholder’s perspective.
Measures whether earnings have been

ROE

19.0%

21.1% efficiently obtained as compared with theamount of shareholder investment

Fiscal 2022 allocation (target period: fiscal year ended March 2023 to fiscal year ending March 2025)
Indicators
Sales(Billions of yen)

(Yen)

Actual(consolidated)

Reason for selection
Selected as an indicator for its measurement of

760.0- the Group’s degree of growth in domestic andoverseas markets.
Selected as an indicator for its measurement of560- the Company’s degree of growth from ashareholder’s perspective.
Measures whether earnings have been

ROE

20.0%

- efficiently obtained as compared with theamount of shareholder investment

34

Financial Statements

Basic earnings per share

Target(consolidated)Reference Material for the General Meeting of Shareholders

Evaluation by
external

Selected as indicators to measure theorganization and

ESG indicators- initiatives relating to sustainability from anstatus of

ESG standpoint

initiatives for the
key ESG themes(Note)The evaluations from three companies (CDP, MSCI and Sustainalytics) are used.

Fiscal 2023 allocation (target period: fiscal year ended March 2024 to fiscal year ending March 2026)
Indicators

TargetActual(consolidated)(consolidated)

Reason for selection
Selected as an indicator for its measurement of

Sales

800.0

(Billions of yen)

- the Group’s degree of growth in domestic andoverseas markets.
Selected as an indicator for its measurement of

Basic earnings per share

560

(Yen)

- the Company’s degree of growth from ashareholder’s perspective.
Measures whether earnings have been

ROE

20.0%

- efficiently obtained as compared with theBusiness Reportamount of shareholder investment
Evaluation by
external

Selected as indicators to measure theorganization and

ESG indicators- initiatives relating to sustainability from anstatus of

ESG standpoint

initiatives for the
key ESG themes(Note)The evaluations from three companies (CDP, DJSI and Sustainalytics) are used.

(2) Total amount of remuneration, etc. of Directors and Executive Officers for the fiscal year
Classification
Directors

Independent

7 personsInternal

2 personsTotal

9 persons
4 persons
13 persons

Executive
Officers
Total

Financial Statements

Number ofpayeesTotal amount of remuneration by type
Total amount of
remuneration,
PerformanceFixed salary
Stock options
PSU
etc.
based bonuses
115 million yen(3) million yen

RSU

77 million yen--

41 million yen

10 million yen

10 million yen

-

-

-

-

125 million yen

87 million yen-(3) million yen-

41 million yen

613 million yen 242 million yen 212 million yen- 159 million yen-

738 million yen 328 million yen 212 million yen(3) million yen 159 million yen

41 million yen(Notes)1.	‌At the end of the fiscal year, there were seven Directors (five Independent Directors and two Internal Directors) and three Executive
Officers (two of which were concurrently serving as Directors). The discrepancies exist between these figures and the number of
Directors and Executive Officers listed above because one Executive Officer and two Independent Directors who retired at the closeof the 85th Ordinary General Meeting of Shareholders are included.
2. Fixed salary for Executive Officers includes oversea Executive Officer’s benefit as expatriate of 47 million yen.
3.	‌For the stock options, fair values of stock acquisition rights were calculated and the table above shows amounts to be recorded as
expenses for the fiscal year. In place of stock options, the PSU has been introduced for Executive Officers since fiscal 2019, and the
RSU for Outside Directors since fiscal 2022. Note that although no stock options were newly granted to Executive Officers in thefiscal year on account of the adoption of PSU in place of stock options from fiscal 2019, a portion of stock options granted inprevious years has been recorded as an expense in the fiscal year. In addition, the share-based payment expenses related to Internal
Directors who retired were reversed.
4.	‌For PSU and RSU, the table above shows amounts to be recorded as expenses for the fiscal year. In addition, the share-based
payment expenses related to Executive Officers who retired were reversed.

35

Name
Eiichiro Ikeda,
Representative
Executive Officer
President & CEO

Executiveclassification
Director
Representative
Executive Officer

Total amount

Fixed salary

Performancebased bonuses

Stock options

PSU

5 million yen

5 million yen

-

-

-

322 million yen

120 million yen

99 million yen-

102 million yen

Executive Officers other than the above whose consolidated remuneration totaled 100 million yen or more during theconsolidated fiscal year are as follows.
Name
Ryo Hirooka,
Representative
Executive Officer &CFO
Tomoko Nakagawa,
Executive Officer,
Chief Sustainability
Officer (CSO)

Executiveclassification
Director

Total amount

Fixed salary

Performancebased bonuses

Stock options

PSU

5 million yen

5 million yen

-

-

-

Representative
Executive Officer

199 million yen

66 million yen

64 million yen-

69 million yen

Executive Officer

124 million yen

40 million yen

49 million yen-

35 million yen

Reference Material for the General Meeting of Shareholders(3) Amount of consolidated remuneration for each Director and Executive Officer (CEO)The remuneration of the Chief Executive Officer (CEO) for the 86th fiscal year is as follows.

Business Report
Financial Statements

36

Reference Material for the General Meeting of Shareholders

Accounting Auditors	‌(1) Name

Deloitte Touche Tohmatsu LLC(2) Amount of remuneration, etc.
Classification

Amount of payment

Amount of remuneration, etc. paid to accounting auditors regarding the fiscal year

139 million yen

Aggregate amount of monetary and other asset gains the Company and its subsidiaries owe to
independent auditors

148 million yen(Notes)1.	‌The audit agreement between the Company and its accounting auditors makes no clear distinction between the amount of audit fees
based on the Companies Act and the audit fee based on the Financial Instruments and Exchange Act. For this reason, the total amountof remuneration, etc. paid to the accounting auditors is stated as the amount of remuneration, etc. for the fiscal year.
2.	‌The member firms of Deloitte Touche Tohmatsu Limited provide audit services to the Company’s major subsidiaries overseas.
3.	‌The Audit Committee gave consent on the remuneration, etc. for Accounting Auditors as a result of confirmation and consideration ofmatters including the audit planning by the Accounting Auditors, status of implementation of the audit and calculation basis for theestimate of the remuneration, in light of the “Guidelines for Cooperation with Accounting Auditors” issued by Japan Audit &Supervisory Board Members Association.

(3) Details of non-audit services
The Company commissions and pays compensation for advice and guidance relating to support in formulating medium-term plansregarding information technology to Deloitte Touche Tohmatsu LLC.
(4) Policy on dismissal of accounting auditors or decision against reappointment

Business Report

When a condition that corresponds to any of the reasons for dismissal prescribed in the items of paragraph (1), Article 340 of theCompanies Act exists, and dismissal is deemed to be reasonable, the Audit Committee shall dismiss the accounting auditors withthe agreement of all members of the Audit Committee. In this case, a member of the Audit Committee appointed by the Audit
Committee shall report the dismissal of the accounting auditors and the reason for the dismissal at the first General Meeting of
Shareholders following the dismissal.
The Audit Committee shall also examine the potential for reappointment by taking into consideration the term of office ofaccounting auditors, the status of prior audit execution, the presence or absence of any serious reason that causes accounting
auditors to lose credibility, and other circumstances, and, when reappointment is not considered reasonable, shall place “noreappointment of accounting auditors” on the agenda for discussion at a General Meeting of Shareholders on the regulations of the

Financial Statements

Audit Committee.

[Note]
Yen amounts shown were obtained by rounding fractions to the closest stated units. Percentage figures shown were also obtained byrounding fractions to the lowest place shown. Numbers of shares shown were obtained by rounding down fractions less than the statedunits.

37

1. Frameworks and Policies Concerning Internal Control Systems
The HOYA Group shall operate businesses of different products and markets based on a business division system. Each division
shall carry out business in Japan and overseas under the management of the person responsible for that business using anappropriately assigned group of human resources, and possess the responsibility for management and profitable operations of thebusiness including the subsidiaries belonging to that division. Group Headquarters shall be structured to cooperate with thefunctional departments of each business, specifically with respect to the functions of strategy, legal affairs, finance, and humanresources, and assist and promote the business execution at each business division based on the HOYA Group’s management
policies.
1)

Matters Decided on Systems to Ensure Adequacy of Operations and Operation Status ThereofContents of the resolutions the Board of Directors of the Company made with regard to internal control systems set out in (b)and (e) of item (i), paragraph (1), Article 416 of the Companies Act and Article 112 of the Ordinance for Enforcement of theCompanies Act and a summary of the operation status thereof are as follows:

Financial Statements

38

Business Report(1) Matters required for ensuring the adequacy of operations(i)	‌Systems concerning the storage and management of information about the execution of duties by Executive
Officers
Efforts shall be made to adequately store and manage important matters, including documents, records and minutes
relating to applications for approval within the HOYA Group, in accordance with laws, regulations and otherstandards.
(ii) Regulations and other systems concerning the management of the risk of loss of the HOYA Group
Each business division (including the subsidiaries operating inside the respective business division) andorganization shall try to identify and manage risks, and shall aim for improvements as the occasion demands, taking
into consideration the instructions, etc. of the Internal Audit Department.
If a serious crisis occurs, a crisis management headquarters shall be swiftly established under the direct
management of the CEO, and efforts shall be focused on response, and settlement of the situation.
(iii)	‌Systems for ensuring the efficiency of duty performance by Executive Officers of the Company and each businessdivision
Each division shall carry out its operations according to the annual plan and the quarterly budget adopted atmeetings of the Board of Directors. The HOYA Group shall ensure the efficiency of Group management by
evaluating the levels of target achievement every quarter and working to make improvements as the occasion
demands.
Executive Officers shall be timely and precise in performing their duties based on the decision-making system fortheir execution of duties, which covers their standards for approving important matters.
Efficient procurement of funds shall be conducted in accordance with a common cash management system sharedby the HOYA Group.
Efficient accounting management shall be carried out in accordance with a common accounting management
system shared by the HOYA Group.
(iv)	‌Systems for ensuring compliance with laws, regulations and the Articles of Incorporation of the way duties are
performed by Executive Officers of the Company, Directors etc. of subsidiaries, and employees of the HOYAGroup
The HOYA Business Conduct Guidelines shall be established to guide the conduct of all Group members based on
the Group’s Corporate Mission and Management Principles.
A Group Headquarters Compliance Group under the supervision of the HOYA Group Chief Compliance Officer(CCO) shall be established as well as a Compliance Officer in each business division to establish theabovementioned HOYA Business Conduct Guidelines, provisions related to legal compliance and to provide
training.
The Headquarters Compliance Group shall establish a department for receiving internal reporting (HOYA HelpLine), and this department shall serve as a point to receive reporting or requests for advice from inside and outside
the Group concerning conduct, etc. that is in violation of the HOYA Business Conduct Guidelines, laws andregulations, the Company’s Articles of Incorporation, internal regulations or socially accepted conventions(excluding those related to Executive Officers and CCO). The contents of reports to the department for receiving
internal reporting and the response to such reports shall be reported to the Audit Committee on a regular basis. Any
unfair treatment of the person reporting or the person seeking advice (including any retaliatory measures such as
dismissal, salary reduction, transfer, or harassment) is also prohibited.
Internal reporting concerning Executive Officers and the CCO is responded to directly by the Audit Committee.
(v)	‌Systems for reporting matters concerning performance of duties of employees of the HOYA Group and Directors,
etc. of the Company’s subsidiaries
The performance of duties for each business division shall be reported at the regularly held Budgetary Meetings.
As provided for by the internal rules of the HOYA Group, each business division (including the subsidiaries
operating inside the respective business division) shall obtain the approval of the Group Headquarters for thematters stipulated by the rules and report the occurrence of important matters to the Group Headquarters and theCompany’s Executive Officers.

Reference Material for the General Meeting of Shareholders

Frameworks and Policies of the Company

Reference Material for the General Meeting of Shareholders
Business Report
Financial Statements[Operation Status]
In the fiscal year, decisions were made on important matters in businesses division and Group Headquarters in accordancewith the Rule of HOYA Group headquarters approval process based on the above policies from perspectives of improving
efficiency and value of the entire HOYA Group.
At the Budgetary Meetings held quarterly, risks and opportunities in each business environment were discussed, policies andmeasures were developed and results thereof were verified, and these were reported to the Board of Directors.
The HOYA Business Conduct Guidelines, which is a code of ethics based on HOYA’s Corporate Mission and Management
Principles, were posted on the official website of the HOYA Group and the Group’s portal site with printed copies distributed
to employees who have difficulty accessing both sites for all employees of the HOYA Group to understand the Group’s
mission and compliance policies and to act accordingly in everyday life. Employees annually undergo training on the HOYA
Business Conduct Guidelines at their respective workplaces to increase understanding thereof and to affirm their intention toact accordingly.
Executive Officers reported to the Chairperson of the Audit Committee, after confirming the Guidelines.
The HOYA Help Line, which receives internal reporting, has been established since 2003. The HOYA Help Line, receives
reporting on acts that violate laws and regulations or the HOYA Business Conduct Guidelines from inside and outside theGroup including from employees of suppliers. While protecting the informer, the HOYA Help Line is a system that deals withsuch matters quickly and appropriately, recognizing the problem early and making the relevant organization to exert a selfcorrective function, and ensures the soundness of the Group as a whole. Up to the end of the fiscal year ended March 2024,
the system was introduced into all of the countries in which the Group carries out its business, and a portion of it is operated inconformity with business customs and laws and regulations of the country or region.
The contents of reports to the HOYA Help Line and the response to such reports were reported to the Audit Committee on aregular basis.
(2) Important matters in the execution of duties by the Audit Committee(i)	Matters concerning Directors and employees assisting the Audit Committee in its duties
	The Audit Committee Office shall be established to assist the Audit Committee in its duties.
(ii)	Matters concerning independence from the Executive Officers of Directors and employees stated in the above item andmatters on securing effectiveness of instructions to Directors, etc. stated in the above item
	The Audit Committee has the power to appoint and dismiss staff members of the Audit Committee Office.
	Executive Officers shall not give directions to staff members of the Audit Committee Office.
(iii)	Systems required for reports to the Audit Committee by Executive Officers and employees of the Company, systems required
for reports to the Audit Committee by Executive Officers and employees, etc. of subsidiaries, and systems required to ensure
a person who reports to the Audit Committee does not receive unfair treatment
	The Board of Directors Regulations was amended to require reporting of all important matters to the Board of Directors,
where Independent Directors comprise the majority of Board members. As a result, reports to the Board of Directors began
to cover all important matters. For this reason, no special stipulations are established regarding matters that need to bereported to the Audit Committee.
	The person responsible for the management of each respective business division shall swiftly report information being storedor managed in each organization inside the HOYA Group including subsidiaries operating within the business division asrequested by the Audit Committee or the Internal Audit Department.
	A contact point for receiving internal reporting concerning Executive Officers and the CCO shall be established in the Audit
Committee Office to receive reports from within the HOYA Group regarding violations of laws and regulations, theCompany’s Articles of Incorporation, internal regulations, and socially accepted conventions, or to provide advice thereof.
Any unfair treatment (including any retaliatory measures such as dismissal, reduction in salary, transfer, harassment, etc.) of
the person reporting or the person seeking advice is also prohibited.
(iv)	Matters regarding procedures for advanced payment or reimbursement of costs arising through execution of duties at Audit
Committee, or other costs or obligations arising through execution of other duties for members of the Audit Committee	Concerning claims for costs arising through execution of duties at the Audit Committee for members of the Audit
Committee, when there are claims from each member of the Audit Committee, appropriate processing of relevant costs or
obligations will be performed expeditiously under deliberation by departments and divisions concerned, except in cases when
the costs relating to the relevant claims were not necessary for the execution of the relevant duties.
(v)	Other systems to ensure the effectiveness of audits by the Audit Committee
	The Internal Audit Department shall conduct audits focusing on onsite audits of each place of business inside the HOYA
Group, including subsidiaries, according to the audit policies and plans adopted by the Audit Committee and based on thecost budget to implement them, and shall report to the Audit Committee as the occasion demands.
	The rules of the Audit Committee stipulate the details and ensure the effectiveness thereof.

392) Basic Policy for Eliminating Antisocial Forces
A meeting of the Board of Directors resolved to adopt the following basic policy for the elimination of antisocial forces.
We shall have no association whatsoever with antisocial forces, and deal with undue claims made by such forces resolutely as anorganization in cooperation with specialized external agencies.
[Operation Status]
Preventive measures, including a credit investigation at the time of conclusion of a transaction agreement and steps taken in
the agreement, have been taken. The Company has assigned persons in charge to the Group Headquarters and made themknown as the point of contact in case of any problem throughout the Company and established a system through which it can
respond as an organization, strengthening linkage with the police and lawyers.

Business Report(3) System for ensuring reliability of financial reporting
The HOYA Group shall establish and manage a system of internal controls for financial reporting and build a system forevaluating its financial reporting to ensure the reliability of its financial reporting and valid, appropriate submission of internal
control reports as prescribed in the Financial Instruments and Exchange Act.
[Operation Status]
The department in charge of internal controls placed in the Group Headquarters conducted hearing of reports from eachbusiness division’s manager responsible for supervising the establishment and operation of the respective division’s internal
control system. These were conducted on a regular basis on matters concerning confirmation of the PDCA cycle of therespective system, and on an as-needed basis on matters concerning any change in systems or environments, understanding ofany problem or issue, or occurrence of any event that may cast doubt on effectiveness of any internal control system. The
results of the aforementioned were reported to the CFO, who is responsible for supervising internal controls, and the CEO,
who is ultimately responsible for the Audit Committee and internal controls.

Reference Material for the General Meeting of Shareholders[Operation Status]
The Audit Committee Office has been established to assist the Audit Committee in its duties.
The Internal Audit Department has been established under the Audit Committee Office, and staff members have been assigned
thereto. The Audit Committee Office and Internal Audit Department are organizations fully independent from the executive
department.
The Internal Audit Department conducted audits of each business place of the HOYA Group, including overseas subsidiaries,
according to the audit policies and plans adopted by the Audit Committee and based on the cost budget to implement them.
Moreover, persons in charge of internal audits are assigned to each division, separately from the Internal Audit Department,
and carry out internal audits within each division. The Internal Audit Department provides the Audit Committee with reports
on content of audits carried out by the persons in charge of internal audits assigned to each division.
The Internal Audit Department endeavors to expand areas subject to audit and increase the frequency of audits, in cooperation
with the persons in charge of internal audits assigned to each division.
The Audit Committee received regular reports on the status of audit implementation and the contents of reports to the HOYA
Help Line and the responses thereto, and provided advice as necessary.

2. Basic Policy on Parties that Control Decisions Concerning Corporate Finance and Business Policies
The Company does not have a specific basic policy in this regard. However, the Company’s basic view is as follows:
The Company takes the view that judgment should ultimately lie with shareholders when an acquisition proposal and the like is madewith the transfer of management control as its objective. Currently no concrete threat regarding acquisition emerges. The Company
has no intention to fix concrete arrangements (so-called “takeover response policies”) before the emergence of any such proposal.
The responsibility of management is not to have the Company take unnecessary actions to oppose acquisitions. As an entity that
operates for the benefit of its shareholders, the Company considers it crucial to increase the return of profit to shareholders andincrease its corporate value by constantly monitoring transactions of its shares and changes to its shareholders, to improve its
business performance and increase its financial strength with the greater objective of achieving further growth.

40

Financial Statements

If an acquisition or similar proposal is made, the Company considers it important to provide the information shareholders require to
make a judgment based on an examination of the proposal made by the proposer. If the Company believes that the proposal will notincrease the corporate value of the Company and benefit the common interest of its shareholders, it will clearly explain to theshareholders the reasons that form the background to its position, and try to obtain the understanding of shareholders.

Reference Material for the General Meeting of Shareholders

3. Policy Concerning Decisions on Appropriation of Retained Earnings, etc.
The Company aims to maximize the HOYA Group’s corporate value by developing businesses globally and changing the businessportfolio to conform to the changing times and environments.
With respect to capital policy, the Company’s basic policy is to adopt decisions that strike the optimum balance between ensuring
internal reserves for the future growth of the HOYA Group and returning profits to shareholders, while pursuing the optimum capital
structure for the Company that includes financial soundness and capital efficiency in terms of realizing maximum profitability fromthe assets entrusted to the Company by the shareholders.
Internal reserves for future growth will be preferentially appropriated to investment in the growing businesses for market share
expansion, entry into untapped markets, and nurturing and obtaining new technologies. In addition to growth of existing businesses,
the Company will also proactively pursue possibilities including mergers and acquisitions to further enrich our business portfolio.
With respect to returning profit to shareholders, the Company’s policy is to proactively return profit to shareholders through using
surplus funds for dividends and the share repurchases while giving comprehensive consideration to the operating performance of thecurrent term, level of internal reserves, and the medium to long term capital demands and capital structure, among other factors.
Coupled with the interim dividend of 45 yen per share already paid, the annual dividend will be 110 yen per share. The consolidated
dividend payout ratio was 21.3%.
By the above policy, the Company’s total shareholder return (TSR) was 263. As a comparative indicator, the Tokyo Stock Price
Index’s TSR (including dividends) was 196.

4. Policy Regarding Cross-shareholding
The HOYA Corporate Governance Guidelines stipulate that we will not practice cross-shareholding as a share stability measure.
With regard to shares of other companies held for their usefulness from a business management standpoint, our policy is toappropriately sell off holdings that have become less meaningful. In fiscal 2023, the Company held shares of two public companies.
The Company’s Board of Directors decided to sell the shares of these two companies because they judged it less significant to keep
holding them.

Financial Statements

Business Report

This indicates a principal amount invested on March 31, 2019, indexed at 100, with performance thereafter indicating share pricechanges plus dividends.

41

The Company promotes management with theaim of maximizing its corporate value based on
the recognition that corporate governance is amatter of utmost importance for management.

Corporate Governance Structure (As of March 31, 2024)

As the basis of taking a fair approach to
stakeholders, we adopted a “company with
Nomination Committees, etc.” structure
simultaneously with the revision of theCompanies Act in 2003, which enables us tobetter distinguish the execution and supervisionof management to prevent management frombeing conducted based solely on in-house logic.
We have also set forth in the Articles ofIncorporation that the majority of Directors
consist of Independent Directors, who actively
supervise management by Executive Officers andprovide advice in order to improve corporate
value from an objective and broad perspective.

Board of Directors(Management Supervision)

Independent
Director

General Meeting of Shareholders

Internal
Director

Election

Executive Officer System

Executive Officers

Board of Directors

Election

5 Independent
Directors
2 Internal Directors

Supervision&
AdviceNomination
Committee
5 Independent
Directors

Compensation
Committee
5 Independent
Directors

Audit
Committee
5 Independent
Directors

Nomination
Committee
Secretariat

Compensation
Committee
Secretariat

Audit
Committee
Secretariat

2 Representative
Executive Officers
1 Executive Officers

Reference Material for the General Meeting of Shareholders

Corporate Governance

Divisions

The Company also gives Executive Officers the authority and responsibility for the execution of operations, in order to accelerate
decision making and improve management efficiency.
The Company established HOYA Corporate Governance Guidelines at the meeting of the Board of Directors, and intends to enhance
corporate governance structure and to introduce better governance systems by revising the guidelines.

Board of Directors
The Company’s Board of Directors, in which Independent Directors comprise the majority of Board members, convene regular Board
meetings 10 times a year as a general rule.

Executive Officers
Having the structure of a “company with Nomination Committees, etc.,” the authority of the HOYA Board of Directors is entrusted to42

Financial Statements

Each meeting of the Board of Directors involves lively discussions and deliberations in a solemn atmosphere, with globally-minded
Independent Directors with a wealth of management experience supervising the execution of operations by Executive Officers andproviding them with inquiries and advice from various angles. The Board of Directors also works to obtain information as necessaryon trends in legal changes and corporate governance by holding lectures by outside experts and through other means. In fiscal 2023,
the Board of Directors was comprised of 5 Independent Directors and 2 Internal Directors, with two of the Independent Directors being
females. Board of Directors meetings were convened 10 times, with 100% attendance by all Directors. Based on the Board of Director
Regulations, the Board of Directors addresses statutory matters, approves quarterly budgets, approves quarterly earnings reports,
deliberates on M&A, deliberates on the executive organization, and receives reports on the current status and medium- to long-termplans of each business division. Once a year, a questionnaire-based self-evaluation is conducted on the operation and effectiveness of
the Board of Directors and the three committees. The results of the self-assessment in fiscal 2023 are as follows. “The Board of
Directors is of an appropriate composition, and has been evaluated highly for its improved operation and open and lively discussions
with suitable agenda setting by the Chairperson, based on a shared understanding of the importance of demonstrating its function ofmonitoring and supervising Executive Officers. Moreover, the Nomination Committee, Compensation Committee, and Audit
Committee were also highly commended for thorough discussions based on an appropriate size and composition of members. In termsof the matters raised as the major issues in the evaluation of the effectiveness of the Board of Directors in the fiscal year ended March
31, 2023 ((1) Further discussions on important management issues such as the discussion on formulation of medium- to long-term
strategies; (2) Enhancement of discussions on the CEO succession plan; and (3) Enhancement of discussions on risks related tosustainability issues), although there was a certain level of progress, it was recognized that further initiatives will be required moving
forward. For (1), in particular, it is expected to further deepen discussions on the course of action for medium- to long-term growthstrategies and the Company’s portfolio.” Looking ahead, to conduct discussion on each issue, we will continue to examine, improve,and further strengthen effectiveness in light of the operation of the Board of Directors, communication among Directors and between
Directors and Executive Officers, and the composition of the Board of Directors.

Business Report

Please see the HOYA Corporate Governance Guidelines athttps://www.hoya.com/wp-content/uploads/2022/04/Governance_Guideline_E_en.pdf

Reference Material for the General Meeting of Shareholders

Executive Officers, enabling swift execution of business. Three persons – namely, the Chief Executive Officer (CEO), Chief Financial
Officer (CFO), and Chief Sustainability Officer (CSO) have been nominated by the Nomination Committee as candidates for
Executive Officers and elected at the Board of Directors meetings. Each of them oversees the execution of operations in theirrespective jurisdictions determined by the Board of Directors, and carries out decision-making in a speedy fashion. The Executive
Officers instruct the Group Headquarters and the person responsible for the business divisions to establish and carry out specificmeasures based on the management policy determined by the Board of Directors. Budgetary Business Division Meetings are held
every quarter in each business division, with attendance by all Executive Officers. At these meetings, each division’s progress ischecked vis-a-vis the annual plan and deliberations are held on plans for the coming quarter. Business operations in each businessdivision are largely delegated to the person responsible for the business division, who carries out the action plan approved at theBudgetary Meeting. In addition to CEO and CFO, CSO also attends each meeting of the Board of Directors.

Committees

Financial Statements

Business Report

The Board of Directors has internal organizations, namely, “Nomination Committee,” “Compensation Committee” and “Audit
Committee,” each of which consists of Independent Directors.
Nomination Committee
The Nomination Committee, on which all Independent Directors (5 Directors as of the end of fiscal 2023) hold a seat, fairly andrigorously selects candidates for Directors (ensuring said candidates possess knowledge, expertise, and capabilities suited to HOYA’s
business environment), based on the “Basis for Election of Candidates for Directors,” and proposes the candidates to the General
Meeting of Shareholders for voting. The Committee also fairly and rigorously selects candidates (with knowledge, expertise, andcapabilities suited to HOYA’s business environment) for Executive Officers and the Representative Executive Officer, based on the“Standard for Election of Candidates for Executive Officer,” and proposes the candidates to the Board of Directors for voting. In casesthat meet the criteria for dismissal, the Committee makes decisions to propose the dismissal of Directors to the General Meeting of
Shareholders and the dismissal of Executive Officers to the Board of Directors for voting. The Committee sets out the criteria for
independence of candidates for Directors, which is stricter than the rules by Tokyo Stock Exchange so that a function of overseeing
Executive Officers required to Independent Directors is secured. The requirements for the independence of candidates for Independent
Directors are described on the pages 13 of the Reference Material. Nomination Committee meetings were convened 6 times in fiscal
2023, with 100% attendance by all committee members. During the fiscal year under review, discussions were conducted, in particular,
on the succession plan of Executive Officers.
Compensation Committee
The Compensation Committee, on which all Independent Directors (5 Directors as of the end of fiscal 2023) hold a seat, builds a
remuneration structure that gives more incentives to Directors and Executive Officers and assesses their work in an appropriatemanner, with the aim to help improve the Company’s business performance. The Compensation Committee determines the
remuneration of Directors and Executive Officers on an individual basis. The policy of Compensation Committee is shown on thepages 31-36. Compensation Committee meetings were convened 8 times in fiscal 2023, with 100% attendance by all committee
members. During the fiscal year under review, deliberations were conducted in depth, in particular, on the composition and level of
remuneration for Executive Officers, as well as the targets to link with their incentives.
Audit Committee
The Audit Committee, on which all Independent Directors (5 Directors as of the end of fiscal 2023) hold a seat, formulates the audit
policies and audit plans for each fiscal year, and verifies financial statements, etc. based on the quarterly reports and year-end reports
received from the Accounting Auditor according to such policies and plans. It also interviews the Internal Audit Department to obtain
the results of operational audits, and verifies the soundness, legality, efficiency, etc. of management. All important matters are reported
to the Board of Directors, and countermeasures are taken as necessary. Audit Committee meetings were convened 9 times in fiscal
2023, with 100% attendance by all committee members. Deliberations during the fiscal year under review focused on reports from the
Accounting Auditor and Internal Audit Department, while providing advice and suggestions to the executive team with regard to theissues that came to light.

43

(As of March 31, 2024)(Millions of yen)

Item

AmountASSETS

Item

AmountEQUITY AND LIABILITIES
346,988

EQUITY

Property, plant and equipment–net

198,225

Equity attributable to owners of theCompany:

Goodwill

52,742Intangible assets

34,042

Investments in associates

1,487

Long-term financial assets

48,401Other non-current assets

463

Non-current assets:

Deferred tax assets

11,628

967,758

Share capital

6,264

Capital reserves

15,899Treasury shares(6,874)

Other capital reserves(17,009)

Retained earnings

805,997

Accumulated other comprehensive
income163,482

Non-controlling interests(5,494)Current assets:

856,635

Inventories

119,076

LIABILITIES

Trade and other receivables

152,606

Non-current liabilities:

Other short-term financial assets

19,237

Interest-bearing long-term debt

20,590

Income taxes receivable

4,298

Other long-term financial
liabilities

24,801Other current assets

35,973Retirement benefit liabilities

4,315

Cash and cash equivalents

525,162

Provisions

3,265

Other non-current liabilities

6,034

Subtotal

856,352

Deferred tax liabilities

13,382

72,387282
Current liabilities:

8,649

Trade and other payables

67,771

23,349Provisions

1,705

Other current liabilities

67,291

Subtotal

168,90964

Total liabilities

241,359

Total equity and liabilities

1,203,623

Financial Statements

44

143

Income tax payables

Liabilities directly associated withassets held for sale
1,203,623

168,972

Interest-bearing short-term debt

Other short-term financial liabilities

Total assets

962,264

Business Report

Assets held for sale

Total equity

Reference Material for the General Meeting of Shareholders

Consolidated Statement of Financial PositionReference Material for the General Meeting of Shareholders
Business Report

Consolidated Statement of Comprehensive Income(From April 1, 2023 to March 31, 2024)(Millions of yen)

Item

AmountRevenue:
Sales

762,610

Finance income

16,279411

Share of profit of associates
Other income

13,328

Expenses:
Changes in inventories of goods, products and work inprogress
Raw materials and consumables used

103,855

Employee benefits expense

184,608

Depreciation and amortization

47,215

792,628

783

Subcontracting cost

4,457

Advertising and promotion expense

18,257

Commissions expense

49,633

Impairment losses

8,831

Finance costs

1,925

Foreign exchange (gain)/loss(9,592)Other expenses

146,092

556,064

Profit before tax

236,564

Income tax expense

53,998

Profit for the year

182,566

Other comprehensive income/(loss):
Items that will not be reclassified subsequently to profit or
loss:
Financial assets measured at fair value through othercomprehensive income
Remeasurements of the net defined benefit liability (asset)
Income tax relating to components of other comprehensive
incomeItems that may be reclassified subsequently to profit or loss:

2,236
(18)
(319)

Exchange differences on translation of foreign operations

65,099

Share of other comprehensive income of associates
Income tax relating to components of other comprehensive
incomeOther comprehensive income/(loss)

122
(43)

1,898

65,177
67,076249,642

Total comprehensive income for the year

Financial Statements

Profit attributable to:
Owners of the Company

181,377

Non-controlling interests

1,190

182,566

Total comprehensive income attributable to:
Owners of the Company

246,644

Non-controlling interests

2,998

45

249,642(From April 1, 2023 to March 31, 2024)(Millions of yen)

Share capital

Balance at April 1, 2023

Capital reserves

6,264

Treasury shares

15,899Other capital reserves(41,374)Retained earnings(12,800)

752,999

Comprehensive income/(loss) for the year

Profit for the year

181,377

Other comprehensive income/(loss)

181,377

Total comprehensive income/(loss) for the year

Transactions with owners
Contributions by and distributions to owners

Acquisition of treasury shares(56,049)(3)

Disposal of treasury shares

1,202

(759)

Cancellation of treasury shares

89,347(89,347)

Dividends, 110 yen per share(38,806)(3,528)Changes in ownership interest in subsidiaries

Change in non-controlling interests－

Share-based payments

80

Transfer to retained earnings
Total contributions by anddistributions to owners
Total transactions with owners

(225)
－

－

34,500(4,209)(128,379)－－

34,500(4,209)(128,379)

6,264

15,899(6,874)(17,009)805,997

Financial assets Exchange Remeasurements
Share ofAccumulated
EquityNonmeasured at
differences of the net defined
other
other
attributable tocontrollingfair value
onbenefit liability comprehensi comprehensive owners of theinterests
through other translation of(asset)ve income of income/(loss)
Company
comprehensive
foreignassociates
incomeoperations

Balance at April 1, 2023

5,729

－

93,513(1,908)97,334

Total equity

818,321(3,717)

814,604

181,377

1,190

182,566

Business Report

Balance at March 31, 2024

Reference Material for the General Meeting of Shareholders

Consolidated Statement of Changes in Equity

Comprehensive income/(loss) for the year

Profit for the year
Other comprehensive income/(loss)

1,918

63,252(25)

122

65,26765,267

1,809

67,076

Total comprehensive income/(loss) for the year

1,918

63,252(25)

122

65,267

246,6442,998

249,642

Transactions with owners
Contributions by and distributions to owners

Acquisition of treasury shares
Disposal of treasury shares(56,052)(56,052)

443

443

Cancellation of treasury shares－

Dividends, 110 yen per share(38,806)－(38,806)

656(4,683)(7,555)

－

(93)

(93)

Share-based payments

80

80

－

－

Transfer to retained earnings
Total contributions by anddistributions to owners
Total transactions with owners
Balance at March 31, 2024

200

25

225

200

656

25

－

881

(97,206)(4,776) (101,983)

200

656

25

－

881

(97,206)(4,776) (101,983)

7,847

157,421－(1,786)

163,482

967,758(5,494)

46

962,264

Financial Statements(2,872)

Change in non-controlling interests

Changes in ownership interest in subsidiaries

656－

Reference Material for the General Meeting of Shareholders(TRANSLATION)
INDEPENDENT AUDITOR'S REPORTMay 23, 2024
To the Board of Directors of
HOYA CORPORATION:
Deloitte Touche Tohmatsu LLC
Tokyo office
Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Koichi Kuse
Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Takuya Sumita

Business Report

Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Osamu Hattori
OpinionPursuant to the fourth paragraph of Article 444 of the Companies Act, we have audited theconsolidated financial statements of HOYA CORPORATION and its consolidated subsidiaries (the"Group"), namely, the consolidated statement of financial position as of March 31, 2024, and theconsolidated statement of comprehensive income and consolidated statement of changes in equity forthe fiscal year from April 1, 2023 to March 31, 2024, and the related notes.
In our opinion, the accompanying consolidated financial statements present fairly, in all material
respects, the consolidated financial position of the Group as of March 31, 2024, and its consolidated
financial performance for the year then ended in accordance with accounting standards prescribedpursuant to the provisions of the second sentence of the first paragraph of Article 120 of theOrdinance on Company Accounting that omit a part of the disclosures required under IFRS
Accounting Standards.

Financial Statements

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor's Responsibilities for the
Audit of the Consolidated Financial Statements section of our report. We are independent of theGroup in accordance with the provisions of the Code of Professional Ethics in Japan, and we havefulfilled our other ethical responsibilities as auditors. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Other Information
Management is responsible for the other information. The Audit Committee is responsible for overseeing
the Officers and Directors' execution of duties relating to the design and operating effectiveness of the- 284 47

Our opinion on the consolidated financial statements does not cover the other information and we do
not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read theother information and, in doing so, consider whether the other information is materially inconsistent withthe consolidated financial statements or our knowledge obtained in the audit or otherwise appears to bematerially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and the Audit Committee for the Consolidated Financial
Statements

Reference Material for the General Meeting of Shareholders

controls over the other information. The other information comprises the information included in theBusiness Report and the accompanying supplemental schedules.

Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with accounting standards prescribed pursuant to the provisions of thesecond sentence of the first paragraph of Article 120 of the Ordinance on Company Accounting that
omit a part of the disclosures required under IFRS Accounting Standards, and for such internal control
as management determines is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to fraud or error.

The Audit Committee is responsible for overseeing the Officers and Directors' execution of duties
relating to the design and operating effectiveness of the controls over the Group's financial reporting
process.
Auditor's Responsibilities for the Audit of the Consolidated Financial Statements

Business Report

In preparing the consolidated financial statements, management is responsible for assessing theGroup's ability to continue as a going concern, disclosing, as applicable, matters related to going
concern in accordance with accounting standards prescribed pursuant to the provisions of the second
sentence of the first paragraph of Article 120 of the Ordinance on Company Accounting that omit apart of the disclosures required under IFRS Accounting Standards.

Our objectives are to obtain reasonable assurance about whether the consolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to issue
an auditor's report that includes our opinion. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:• Identify and assess the risks of material misstatement of the consolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks. The
procedures selected depend on the auditor's judgment. In addition, we obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.
• Conclude on the appropriateness of management's use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Group's ability to continue as a going concern. If
we conclude that a material uncertainty exists, we are required to draw attention in our auditor'sreport to the related disclosures in the consolidated financial statements or, if such disclosures are
inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to48

Financial Statements• Obtain, when performing risk assessment procedures, an understanding of internal control relevantto the audit in order to design audit procedures that are appropriate in the circumstances, but not forthe purpose of expressing an opinion on the effectiveness of the Group's internal control.

Reference Material for the General Meeting of Shareholders

the date of our auditor's report. However, future events or conditions may cause the Group to cease
to continue as a going concern.
• Evaluate whether the overall presentation and disclosures of the consolidated financial statements
are in accordance with accounting standards prescribed pursuant to the provisions of the second
sentence of the first paragraph of Article 120 of the Ordinance on Company Accounting that omit apart of the disclosures required under IFRS Accounting Standards, as well as the overall
presentation, structure and content of the consolidated financial statements, including thedisclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities orbusiness activities within the Group to express an opinion on the consolidated financial statements.
We are responsible for the direction, supervision and performance of the group audit. We remainsolely responsible for our audit opinion.
We communicate with the Audit Committee regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicate with it all relationships and other mattersthat may reasonably be thought to bear on our independence, and where applicable, actions taken toeliminate threats or safeguards applied.

Our firm and its designated engagement partners do not have any interest in the Group which is
required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

Notes to the Readers of Independent Auditor's Report
This is an English translation of the independent auditor's report as required by the Companies Act ofJapan for the conveniences of the reader.

Financial Statements

Business Report

Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan

49

(As of March 31, 2024)(Millions of yen)

Item

AmountItem

ASSETS
Current assets

AmountLIABILITIES
144,835

Current liabilities

117,189

Cash and deposits

47,381

Notes payable – trade

Notes receivable – trade

1,677Electronically recorded obligations – operating

3,518

Accounts receivable – trade42,879Accounts payable — trade21,409Merchandise and finished products

12,519

Short-term borrowings from subsidiaries and affiliates

43,962Work in process

4,586

Accounts payable – other5,978

Raw materials and supplies

4,932

Accrued expenses

4,935

Short-term loans receivable from subsidiaries and affiliates

2,493

Accrued income taxes

11,964Current portion of long-term loans receivablefrom subsidiaries and affiliates

9,280

Advances received

5,545

Accounts receivable from subsidiaries and affiliates – other

13,782

Deposits received

13,355
4,238

7,564

Accrued bonuses to employees

Allowance for doubtful accounts(2,258)Warranties provisionNon-current assets

222,881

OthersProperty, plant and equipment–net

24,001Long-term liabilities

Buildings

4,281

Asset retirement obligations

Structures

228

Reserve for periodic repairs

Melting furnaces

61

OthersOthers

Machinery and equipment
Vehicles

1,900
3

Total liabilities

38

231
2,014
2,929
1,458
440
1,030
120,118

NET ASSETS
247,185

6,744

Land

3,380

Share capital

6,264

Construction in progress

7,403

Capital reserve

15,899Intangible assets

1,908

Others647
1,261

Shareholders’ equity:

Additional paid-in capital

15,899Retained earnings

231,896

Legal reserve

196,972

Other retained earnings

Investment securities

27,883

Reserve for advanced depreciation of fixed assets

Equity securities of subsidiaries and affiliates

139,837

Unappropriated retained earnings

Investments and other assets

Investments in capital
Investments in subsidiaries and affiliates

218,686Long-term prepaid expenses

221

Claims in bankruptcy

139

Deferred tax assets

4,107

Others6,232

Allowance for doubtful accounts(135)

Total assets

367,717

Treasury shares — at cost
Valuation and translation adjustments
Unrealized gain on available-for-sale securities
Stock acquisition rights

1,566
230,330
38

Business Report

Tools, equipment and fixtures

Software

Reference Material for the General Meeting of Shareholders

Nonconsolidated Balance Sheet

230,292(6,874)
118
118
296

Total net assets

247,599

Total liabilities and net assets

367,717

Financial Statements

50

Reference Material for the General Meeting of Shareholders

Nonconsolidated Statement of Income(From April 1, 2023 to March 31, 2024)(Millions of yen)

Item

AmountNet sales

223,724

Cost of sales

105,020Gross profit

118,703

Selling, general and administrative expenses

70,004

Operating income

48,699Non-operating income
Interest income

1,883

Dividend income

1,151

Commissions received

11,475

Foreign exchange gain

1,999

Others224

16,731Business Report

Non-operating expenses
Interest expense

147

Provision of allowance for doubtful accounts

71

Bad debt expenses

84

Settlement payments

53

Others41

Ordinary income

396
65,034Extraordinary income
Gain on sale of non-current assets

3Gain on sale of shares of subsidiaries

3,458

Others29

3,489

Extraordinary losses
Loss on sale of non-current assets

0Loss on retirement of non-current assets

73

Loss on valuation of shares of subsidiaries and affiliates

43

Loss on liquidation of subsidiaries

180

Extra retirement payments

61

Profit before income taxes

358
68,166

Income taxes – current

21,157

Income taxes for prior periods

3

Income taxes – deferred(740)

20,41947,747

Financial Statements

Profit for the year

51

(From April 1, 2023 to March 31, 2024)(Millions of yen)
Shareholders’ equity
Capital reserve
Share capital Additional
paid-in
capitalBalance at April 1, 2023

6,264

15,899Retained earnings
Other retained earnings

Total capital Legal reserve
surplus15,899Reserve foradvanced
Unappropriateddepreciation of retained earnings
fixed assets

1,566

42

Changes during the current fiscal year
Reversal of reserve for advanced
depreciation of fixed assets
Dividends from retained earnings

311,366

312,975

4－(38,806)(38,806)

47,74747,747(4)

Profit for the year

Total retained
earnings

Reference Material for the General Meeting of Shareholders

Nonconsolidated Statement of Changes in Equity

Acquisition of treasury shares
Disposal of treasury shares

(672)

(672)

Cancellation of treasury shares(89,347)(89,347)

Changes in items other thanshareholders’ equity during the current
fiscal year－net
Total changes during the current fiscal
year
Balance at March 31, 2024

－

－

－

－

(4)

(81,075)(81,079)

6,264

15,89915,8991,566

38230,292

231,896

Treasuryshares - atcost
Balance at April 1, 2023

(41,374)

Changes during the current fiscal year
Reversal of reserve for advanced
depreciation of fixed assets
Dividends from retained earnings

293,763

39

39

Stock acquisitionrights414

Total
net assets

294,216－－(38,806)(38,806)

47,74747,747(56,049)(56,049)(56,049)

Disposal of treasury shares

1,202

530

530

Cancellation of treasury shares

89,347－－

Profit for the year
Acquisition of treasury shares

Changes in items other thanshareholders’ equity during the current
fiscal year－net
Total changes during the current fiscal
year
Balance at March 31, 2024

79

79

(118)

(39)

34,500(46,579)

79

79

(118)

(46,617)(6,874)

247,185

118

118

296

247,599

Business Report

Valuation and translation
adjustments
Unrealized
Total
Total valuation
gain/(loss) on
shareholders’ available-for-saleand translation
adjustments
equitysecurities

Shareholders’ equity

Financial Statements

52

Reference Material for the General Meeting of Shareholders(TRANSLATION)
INDEPENDENT AUDITOR'S REPORTMay 23, 2024
To the Board of Directors of
HOYA CORPORATION:
Deloitte Touche Tohmatsu LLC
Tokyo office
Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Koichi Kuse
Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Takuya Sumita

Business Report

Designated Unlimited Liability
Engagement Partner,
Certified Public Accountant:
Osamu Hattori
OpinionPursuant to the first item, second paragraph of Article 436 of the Companies Act, we have audited thenonconsolidated financial statements of HOYA CORPORATION (the "Company"), namely, thenonconsolidated balance sheet as of March 31, 2024, and the nonconsolidated statement of income
and nonconsolidated statement of changes in equity for the 86th fiscal year from April 1, 2023 toMarch 31, 2024, and the related notes and the accompanying supplemental schedules.
In our opinion, the accompanying nonconsolidated financial statements present fairly, in all material
respects, the financial position of the Company as of March 31, 2024, and its financial performance forthe year then ended in accordance with accounting principles generally accepted in Japan.

Financial Statements

Basis for Opinion
We conducted our audit in accordance with auditing standards generally accepted in Japan. Our
responsibilities under those standards are further described in the Auditor's Responsibilities for the
Audit of the Nonconsolidated Financial Statements section of our report. We are independent of theCompany in accordance with the provisions of the Code of Professional Ethics in Japan, and we havefulfilled our other ethical responsibilities as auditors. We believe that the audit evidence we haveobtained is sufficient and appropriate to provide a basis for our opinion.
Other Information
Management is responsible for the other information. The Audit Committee is responsible foroverseeing the Officers and Directors' execution of duties relating to the design and operating
effectiveness of the controls over the other information. The other information comprises theinformation included in the Business Report and the accompanying supplemental schedules.

53

In connection with our audit of the nonconsolidated financial statements, our responsibility is to readthe other information and, in doing so, consider whether the other information is materially inconsistent
with the nonconsolidated financial statements or our knowledge obtained in the audit or otherwise
appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of thisother information, we are required to report that fact. We have nothing to report in this regard.
Responsibilities of Management and the Audit Committee for the Nonconsolidated Financial
Statements
Management is responsible for the preparation and fair presentation of the nonconsolidated financial
statements in accordance with accounting principles generally accepted in Japan, and for suchinternal control as management determines is necessary to enable the preparation of nonconsolidated
financial statements that are free from material misstatement, whether due to fraud or error.

Reference Material for the General Meeting of Shareholders

Our opinion on the nonconsolidated financial statements does not cover the other information and we
do not express any form of assurance conclusion thereon.

In preparing the nonconsolidated financial statements, management is responsible for assessing theCompany's ability to continue as a going concern, disclosing, as applicable, matters related to going
concern in accordance with accounting principles generally accepted in Japan.
The Audit Committee is responsible for overseeing the Officers and Directors' execution of duties
relating to the design and operating effectiveness of the controls over the Company's financial
reporting process.
Auditor's Responsibilities for the Audit of the Nonconsolidated Financial Statements
Business Report

Our objectives are to obtain reasonable assurance about whether the nonconsolidated financial
statements as a whole are free from material misstatement, whether due to fraud or error, and to issue
an auditor's report that includes our opinion. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, they could reasonably be expected to influence
the economic decisions of users taken on the basis of these nonconsolidated financial statements.
As part of an audit in accordance with auditing standards generally accepted in Japan, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:• Identify and assess the risks of material misstatement of the nonconsolidated financial statements,
whether due to fraud or error, design and perform audit procedures responsive to those risks. The
procedures selected depend on the auditor's judgment. In addition, we obtain audit evidence that is
sufficient and appropriate to provide a basis for our opinion.
• Obtain, when performing risk assessment procedures, an understanding of internal control relevantto the audit in order to design audit procedures that are appropriate in the circumstances, but not forthe purpose of expressing an opinion on the effectiveness of the Company's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by management.

• Evaluate whether the overall presentation and disclosures of the nonconsolidated financial
statements are in accordance with accounting principles generally accepted in Japan, as well as theoverall presentation, structure and content of the nonconsolidated financial statements, including thedisclosures, and whether the nonconsolidated financial statements represent the underlying
54

Financial Statements• Conclude on the appropriateness of management's use of the going concern basis of accounting
and, based on the audit evidence obtained, whether a material uncertainty exists related to events
or conditions that may cast significant doubt on the Company's ability to continue as a going
concern. If we conclude that a material uncertainty exists, we are required to draw attention in our
auditor's report to the related disclosures in the nonconsolidated financial statements or, if suchdisclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence
obtained up to the date of our auditor's report. However, future events or conditions may cause theCompany to cease to continue as a going concern.

Reference Material for the General Meeting of Shareholders

transactions and events in a manner that achieves fair presentation.
We communicate with the Audit Committee regarding, among other matters, the planned scope andtiming of the audit and significant audit findings, including any significant deficiencies in internal control
that we identify during our audit.
We also provide the Audit Committee with a statement that we have complied with relevant ethicalrequirements regarding independence, and communicate with it all relationships and other mattersthat may reasonably be thought to bear on our independence, and where applicable, actions taken toeliminate threats or safeguards applied.
Interest Required to Be Disclosed by the Certified Public Accountants Act of Japan
Our firm and its designated engagement partners do not have any interest in the Company which is
required to be disclosed pursuant to the provisions of the Certified Public Accountants Act of Japan.

Notes to the Readers of Independent Auditor's Report

Financial Statements

Business Report

This is an English translation of the independent auditor's report as required by the Companies Act ofJapan for the conveniences of the reader. "The accompanying supplemental schedules" referred to in
the "Opinion" section of this English translation are not included in the attached financial documents.
The other information in "the accompanying supplemental schedules" referred to in the "Other
Information" section of this English translation is not translated.

55

AUDIT REPORTThe members of the Audit Committee of the Company audited the performance of the Directors and Executive Officers of theirduties during the 86th fiscal year from April 1, 2023 to March 31, 2024. We hereby report the method and results thereof:

Business Report

1. AUDIT METHOD AND ITS CONTENTS
We received periodic reports from the Directors, Executive Officers and others concerning the state of construction and managementof the system (internal control system) established in accordance with the resolutions of the Board of Directors concerning mattersprovided for in (b) and (e) of item (1), paragraph (1), Article 416 of the Companies Act, requested explanations and expressed its
opinions as necessary. In addition, we attended important meetings, received reports from Directors, Executive Officers and others on
matters concerning the performance of their duties, requested explanations whenever necessary, inspected documentation of important
decisions, etc. and investigated the state of activities and assets at the head office and major business offices of the Company inaccordance with the audit policy and the assignment of duties, etc. established by the Audit Committee and in collaboration with theaudit department of the Company.
Regarding internal controls over financial reports, we received reports on the evaluation of the internal controls and the state of audits
from Executive Officers and others, as well as Deloitte Touche Tohmatsu LLC, and requested explanations as necessary.
With respect to subsidiaries, we communicated and exchanged information with directors and auditors thereof, and received business
reports from the subsidiaries whenever necessary.
We also monitored the Company’s Independent Auditors to verify that they maintained a position of independence and conducted
proper audits. We received reports from the Independent Auditors on the state of execution of their duties, and asked them for
explanations whenever necessary. Additionally, we received from the Independent Auditors a letter that they were taking steps to build
the System for Ensuring Adequate Execution of Duties (pursuant to the items of Article 131 of the Ordinance on Company
Accounting) in accordance with the Standards for Quality Control of Audit (Business Accounting Council, November 16, 2021), andasked the Independent Auditors for explanations whenever necessary.
Based on the method described above, we examined the business report, financial statements (consisting of the non-consolidatedbalance sheet, non-consolidated statement of income, non-consolidated statement of changes in net assets, and notes to the nonconsolidated financial statements), their supplementary schedules, and consolidated financial statements (consisting of theconsolidated statement of financial position, consolidated statement of comprehensive income, consolidated statement of changes inequity, and notes to the consolidated financial statements, prepared by omitting certain items required to be disclosed by theInternational Financial Reporting Standards and pursuant to the provisions of the latter part of paragraph (1), Article 120 of theOrdinance on Company Accounting) for the current fiscal year.

Reference Material for the General Meeting of Shareholders

Audit Committee’s Audit Report

2. AUDIT RESULTS(1)	Results of the audit of the business report, etc.
A.	We are of the opinion that the business report and its supplementary schedules fairly present the state of the Company inaccordance with laws, ordinances and the Articles of Incorporation.
B.	We are of the opinion that, in connection with the performance by the Directors or Executive Officers of their duties, no
dishonest act or material fact of violation of laws, ordinances or the Articles of Incorporation exists.
C.	We are of the opinion that the resolution of the Board of Directors concerning the internal control system was reasonable. We
are of the opinion that, in connection with the descriptions in the Business Report or the performance by the Directors or
Executive Officers of their duties concerning said internal control system, no matter that needs to be pointed out exists.
(2)	Results of the audit of the financial statements and their supplementary schedules	We are of the opinion that the method and results of the audit made by Deloitte Touche Tohmatsu LLC, the Company’s
Independent Auditors, are in order.
(3)	Results of the audit of the consolidated financial statements
	We are of the opinion that the method and results of the audit made by Deloitte Touche Tohmatsu LLC, the Company’s
Independent Auditors, are in order.
May 24, 2024

Hiroaki Yoshihara
Yasuyuki Abe
Takayo Hasegawa
Mika Nishimura
Mototsugu Sato

Member of the Audit Committee
Member of the Audit Committee
Member of the Audit Committee
Member of the Audit Committee
Member of the Audit Committee

Note: The Members of the Audit Committee, Hiroaki Yoshihara, Yasuyuki Abe, Takayo Hasegawa, Mika Nishimura and Mototsugu Sato are outside directors asprovided in the item (15), Article 2 and paragraph (3), Article 400 of the Companies Act.

56

Financial Statements

Audit Committee
HOYA CORPORATION

Internet Disclosure Accompanying the Notice of the 86th Ordinary General
Meeting of Shareholders
State of Stock Acquisition Rights, etc.
Consolidated Statement of Cash Flows (Reference Information, Unaudited)
Notes to the Consolidated Financial Statements
Notes to the Nonconsolidated Financial Statements(From April 1, 2023 to March 31, 2024)

State of Stock Acquisition Rights, etc.
Stock acquisition rights owned by Directors and Executive Officers of the Company that have been issued as compensation for
their execution of duties as of the end of the fiscal year
17th issue of stock

19th issue of stock

20th issue of stock

21st issue of stock

22nd issue of stockacquisition rights

acquisition rights

acquisition rights

acquisition rights

acquisition rights(July 30, 2019)(July 28, 2020)(July 29, 2021)

Issue (Date ofresolution)(December 22, 2016) (September 18, 2018)
Number of stock
154

309

50

60

100

61,600123,600

20,00024,00040,000common sharecommon sharecommon sharecommon sharecommon share

4,839

6,590

8,542

10,49015,080

yen

yen

yen

yen

yen

acquisition rights
Type and number ofshares to be issued on
exercise of stockacquisition rights
Exercise price per
share
Contribution of stock

No contribution is required in exchange for a stock acquisition right.

acquisition rightOctober 1, 2022 –October 1, 2017 –October 1, 2019 –October 1, 2020 –October 1, 2021 –September 30, 2026

September 30, 2028

September 30, 2029

September 30, 2030

Exercise period

September 30,
2031

Outline of terms and-Exercise of stock acquisition rights is permitted under certain conditions even after retiring from the post due to theconditions for the

expiration of term of office or mandatory retirement age.

exercise of stock-Inheritance or transfer of the stock acquisition rights, creation of a pledge concerning the rights, etc. are not permitted.

acquisition rights
Number of owners/[Number of stock acquisition rights]
Directors(excluding InState

dependent

1

1

0

0

0

of

Directors) and

[37]

[45]

[0]

[0]

[0]

In-dependent

0

1

1

1

2

Directors

[0]

[13]

[5]

[8]

[60]

owner- Executive
ship

Officers1

(Reference Information) Consolidated Statement of Cash Flows(From April 1, 2023 to March 31, 2024)(Unaudited)(Millions of yen)AmountCash flows from operating activities
Profit before tax
Depreciation and amortization
Impairment losses
Finance income
Finance costs
Share of (profit)/loss of associates(Gain)/loss on sales of property, plant and equipment
Loss on disposal of property, plant and equipment
Foreign exchange (gain)/loss
OthersCash generated from operations (before movements in working capital)
Movements in working capital
Decrease/(increase) in inventories
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Increase/(decrease) in retirement benefit liabilities and provisions
SubtotalInterest received
Dividends received
Interest paid
Income taxes paid
Income taxes refunded
Net cash generated from operating activities
Cash flows from investing activities
Withdrawals of time deposits
Payments for time deposits
Proceeds from sales of property, plant, and equipment
Payments for acquisition of property, plant, and equipment
Proceeds from government grant
Proceeds from sales of investments
Payments for acquisition of investments
Proceeds from sale of subsidiaries
Payments for acquisition of subsidiaries
Payments for acquisition of businesses
Other proceeds
Other payments
Net cash used in investing activities
Cash flows from financing activities
Dividends paid to owners of the Company
Increase /(decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Repayments of lease liabilities
Purchase of treasury shares
Proceeds from exercise of stock options
Payments for acquisition of interests in subsidiaries from non-controllinginterests
Net cash used in financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Effects of exchange rate changes on the balance of cash and cash
equivalents in foreign currencies
Cash and cash equivalents at the end of the year
(Notes)1. Numbers in parentheses ( ) in the consolidated statement of cash flows are outflows of cash and cash equivalents.
2. Figures presented above are rounded to the nearest unit.

2

236,564
47,215
8,831(16,279)
1,925
(411)
(1,375)260(8,127)(4,923)
263,680(5,283)
800
3,553
(375)
262,375
12,779118(718)(52,697)945
222,8024,521(2,624)
1,986(41,074)
2,843
65
(90)
3,306
(3,241)(335)
370(1,536)(35,808)(38,778)
(200)
734
(555)
(8,873)(56,052)386(7,555)(110,892)
76,102405,888
43,172525,162

Notes to the Consolidated Financial Statements
Important items for the preparation of the consolidated financial statements
1. Preparation of consolidated financial statements
The consolidated financial statements are prepared in accordance with International Financial Reporting Standards with some omissions of a part of disclosures
pursuant to the second sentence of the first paragraph of Article 120 of the Ordinance on Company Accounting.
2. Basis of consolidation
Number of consolidated
subsidiaries
Names of major consolidated
subsidiaries

141 companies
HOYA HOLDINGS, INC.
HOYA HOLDINGS N.V.
HOYA HOLDINGS (ASIA) B.V.
HOYA HOLDINGS ASIA PACIFIC PTE LTD

During the fiscal year, 4 companies were newly established, 3 companies were liquidated and 1 company was sold.
Consequently, the number of consolidated subsidiaries has not changed.
3. Application of the equity method
Number of associates accounted
11 companies
for by the equity method
Name of major associate
AvanStrate Inc.
4. Items related to accounting policies(1) Basis and method of evaluation of financial assets
Financial assets are classified as “financial assets measured at amortized cost,” “financial assets measured at fair value through other comprehensive
income” (“FVTOCI”) or “financial assets measured at fair value through profit and loss” (“FVTPL”).
1) Financial assets measured at amortized cost
Such financial assets are held within a business model whose objective is to hold financial assets to collect contractual cash flows, and the contractual
terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amountoutstanding. It is measured at amortized cost by using the effective interest method.
2) FVTOCI
Such financial assets are measured at fair value through other comprehensive income if both of the following conditions are met:(i) the financial assets are held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial
assets(ii) the contractual terms of the financial assets give rise on specified dates to cash flows that are solely payments of principal and interest on theprincipal amount outstanding. The change in fair value is recognized in other comprehensive income.
HOYA CORPORATION and its subsidiaries (the “Group”) recognizes the changes in fair value in other comprehensive income for the equity
instruments that the Group irrevocably elected to account for the subsequent changes in fair value within other comprehensive income.
3) FVTPL
Any other securities not included in the classifications above is classified into financial assets measured at fair value through profit and loss. The change
in fair value is recognized in profit or loss.
4) Impairment of financial assets
The Group recognizes a loss allowance for expected credit losses on financial assets measured at amortized cost. The Group assesses whether the credit
risk on a financial instrument has increased significantly since initial recognition. If the credit risk on a financial instrument has not increased
significantly since initial recognition, the Group measures the loss allowance for that financial instrument at an amount equal to 12-month expectedcredit losses. If the credit risk on a financial instrument has increased significantly since initial recognition, the Group measures the loss allowance forthat financial instrument at an amount equal to the lifetime expected credit losses. For trade receivables, the Group always measures allowance for
doubtful accounts at an amount equal to the lifetime expected credit losses. The Group assesses the expected credit losses by using the change in therisk of a default or aging of trade receivables, or other factors. Expected credit losses are recognized in profit or loss.
(2) Basis and method of evaluation of inventories
Inventories are measured at the lower of cost and net realizable value. Net realizable value represents the estimated selling price for the inventories in theordinary course of business, less all estimated costs of completion and costs necessary to make the sale. Costs, including purchase costs, process costs,
storage costs, and all other costs incurred in bringing the inventories to present location and condition, are assigned to inventories mainly by the averagemethod. The production costs include an appropriate portion of fixed and variable overhead expenses.
(3) Basis and method of evaluation, depreciation and amortization of property, plant, and equipment and intangible assets (other than goodwill)
1) Property, plant, and equipment
The Group applies the cost model for measuring property, plant, and equipment.
Property, plant, and equipment are stated at cost, net of accumulated depreciation and impairment losses. Properties under construction for
production, supply, or administrative purposes, or for purposes not yet determined, are carried at cost, less any recognized impairment losses. Cost
includes the expenses directly attributable to the assets, the initial estimated costs relating to scrap, removal and retirement, and, for qualifying assets,
the borrowing cost for long-term projects. Depreciation of these assets commences when the assets are available for their intended use.
When significant components of property, plant, and equipment are required to be replaced periodically, the Group recognizes such parts as
individual assets to be depreciated with specific useful lives. All other repair and maintenance costs are recognized in profit or loss as incurred.
Property, plant, and equipment, other than land and construction in progress, are depreciated mainly on a straight-line basis over the estimated useful
lives listed below. The estimated useful lives, residual values, and depreciation method are reviewed at each year-end, with the effect of any changes
in estimate being accounted for on a prospective basis.
Buildings and structures
3–50 years
Machinery and carriers
3–10 years
Tools, equipment and fixtures
2–10 years32) Intangible assets
The Group uses the cost model for measuring intangible assets. Intangible assets are carried at cost, less accumulated amortization andimpairment losses.
A. Intangible assets acquired separately and/or acquired in a business combination
Intangible assets acquired separately are carried at cost at initial recognition. Intangible assets acquired in a business combination are recognizedseparately from goodwill at their fair value at the acquisition date when they satisfy the definition of intangible assets, are identifiable, and theirfair value is reasonably measured.
B. Internally generated intangible assets — research and development expenses
Expenditures on research activities are recognized as expenses in the period in which they are incurred.
An internally generated intangible asset arising from development (or from the development phase of an internal project) is recognized if, and only
if, all of the following have been demonstrated:(a) the technical feasibility of completing the intangible asset so that it will be available for use or sale;(b) the intention to complete the intangible asset and use or sell it;(c) the ability to use or sell the intangible asset;(d) how the intangible asset will generate probable future economic benefits;(e) the availability of adequate technical, financial, and other resources to complete development and to use or sell the intangible asset; and(f) the ability to measure reliably the expenditure attributable to the intangible asset during its development.
The amount initially recognized for internally generated intangible assets is the sum of the expenses incurred from the date when the intangible
assets first meet all of the recognition criteria listed above. The assets are amortized over the estimated period in which the development costs are
expected to be recovered. If no future economic benefit is expected before the end of the life of assets, the residual book value is expensed.
Subsequent to initial recognition, internally generated intangible assets are reported at cost less accumulated amortization and impairment losses.
Where no internally generated intangible asset can be recognized, development costs are recognized as an expense in the period in which they are
incurred.
C. Amortization of intangible assets
Amortization is recognized on a straight-line basis over the estimated useful lives below. The Group does not have any intangible assets withindefinite useful lives.
Technology
10–20 years
Customer-related assets
5–16 years
Software
3– 5 years3) Impairment of property, plant and equipment and intangible assets other than goodwill
At the end of each reporting period, the Group reviews the carrying amounts of its property, plant and equipment and intangible assets to determine
whether there are any indications that those assets have suffered impairment losses. If any indications exist, the recoverable amount of the cashgenerating unit, to which the asset belongs, is estimated in order to determine the extent of the impairment losses (if any).
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (orcash-generating unit) is reduced to its recoverable amount.
(4) Leases
As a lessee, the Group recognizes a right-of-use asset and a lease liability at the commencement date. The lease liability is measured at the present valueof the lease payments that are not paid at the commencement date. The right-of-use asset is measured at cost comprised of the initial amount of the leaseliability adjusted for any lease payments made at or before the commencement date, any initial direct costs incurred and an estimate of costs, such as thecost to dismantle and remove the underlying asset to the original condition required by the terms and conditions of lease contracts.
After the commencement date, the right-of-use asset is depreciated on a straight-line basis over the useful life or lease term, whichever is shorter.
The lease payments comprise of interest expense recognized as finance costs in the Consolidated Statement of Comprehensive Income and repaymentsof the lease liability that are calculated by the interest method. The Group does not recognize right-of-use assets and lease liabilities for short-termleases that have a lease term of 12 months or less and for leases of low-value assets. The Group recognizes the lease payments associated with theseleases as expense on straight-line basis over the lease term or other systematic basis.
As a lessor, the Group classifies each of its leases as either an operating lease or a finance lease. A lease is classified as a finance lease if it transfers
substantially all the risks and rewards incidental to ownership of an underlying asset. A lease is classified as an operating lease if it does not transfer
substantially all the risks and rewards incidental to ownership of an underlying asset.
At the commencement date, the asset held under a finance lease is recognized on the Consolidated Statement of Financial Position and presented as areceivable at an amount equal to the net investment in the lease.
The assets held under an operating lease are on the Consolidated Statement of Financial Position and the lease payments received are recognized asincome on a straight-line basis over the lease term in the Consolidated Statements of Comprehensive Income.
(5) Goodwill
Goodwill arising from the acquisition of a business is recognized as an asset at the date that control is acquired (i.e., the acquisition date). Goodwill ismeasured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of theacquirer’s previously held equity interest in the acquiree (if any) over the acquisition-date amounts of the net fair value of the identifiable assets acquired
and liabilities assumed. Goodwill is not amortized but is reviewed for impairment at least annually. Goodwill is recorded at cost, less accumulated
impairment losses in the consolidated statement of financial position.
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (or groups of cash-generating units) that is
expected to benefit from the synergies of the combination. Cash-generating units to which goodwill has been allocated are tested for impairment
annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less thanits carrying amount, the impairment losses are allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the otherassets of the unit pro-rata on the basis of the carrying amount of each asset in the unit. Impairment losses recognized for goodwill are not reversed insubsequent periods. Upon disposal of a cash-generating unit, the attributable amount of goodwill is included in the determination of profit or loss upon
disposal.
(6) Method of accounting for significant provisions
Provisions are recognized when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be
required to settle the obligation by outflow of resources embodying economic benefits, and a reliable estimate can be made of the amount of theobligation. The amount recognized as a provision is the best estimate of the consideration required to settle the present obligation at the end of thereporting period (i.e., future cash outflow), taking into account the risks and uncertainties surrounding the obligation.
Where the time value of money is material, a provision is measured by its present value to which estimated future cash flows are discounted using a pretax discount rate that reflects the risks specific to the obligation. Interest cost associated with the passage of time is recognized as a finance cost.
The types of provisions are as follows:
1) Asset retirement obligation
The Group recognizes provisions for an asset retirement obligation reserve for estimated costs arising from a contractual obligation to a landlord to
dismantle and remove leasehold improvements from a leased office at the end of the lease contract, and estimated costs to decontaminate certain
fixed assets. An asset retirement obligation is provided based on past experience of actual cost and each asset is considered individually. The
discount rate depends on the useful life of the corresponding assets and the country in which such assets are located. Future expected timing ofoutflow of economic benefits is mainly more than one year from each reporting period.

42) Warranties provision
Warranties provision is estimated and recognized based on past experience of the occurrence of defective goods and the expected after service
costs in the warranty period. Expected outflow of economic benefits in the future is within one year from each reporting period.
3) Contingent liabilities assumed in a business combination
Contingent liabilities resulting from a business combination are initially measured at fair value on the date of acquisition. Subsequent to initialrecognition, such contingent liabilities are remeasured considering expected future payments, possible occurrence, and timing of payments at eachreporting period.
(7) Method of accounting for retirement benefits
For defined benefit plans, the cost of providing retirement benefits is determined using the projected unit credit method with actuarial valuations being
carried out at the end of each reporting period.
Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable), and the return on plan assets (otherthan interest), is reflected immediately in the consolidated statement of financial position with a charge or credit recognized in other comprehensive
income in the period in which it occurs. Remeasurement recognized in other comprehensive income is reflected immediately in retained earnings andwill not be reclassified to profit or loss.
Past service cost is recognized in profit or loss in the period of a plan amendment.
Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.
Defined benefit costs are categorized as follows:
Service cost, including current service cost, past service cost, as well as gains or losses on curtailments and settlements;
Net interest expense or income; andRemeasurement.
The Group presents the first two components of defined benefit cost in profit or loss as “Employee benefits expense” or “Finance cost.”
The retirement benefit obligation recognized in the consolidated statement of financial position represents the actual deficit or surplus in the Group’s
defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form ofrefunds from the plans or reductions in future contributions to the plans.
Payments to defined contribution retirement benefit plans are recognized as an expense when employees have rendered service to the Group.
(8) Revenue recognition
The Group recognizes revenue based on the five-step approach below:
Step 1: Identify the contracts with customers
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the entity satisfies a performance obligation
The Group sells health care related products, medical related products, electronics related products, imaging related products, etc. and recognizes
revenue when the control of products is transferred to the customer and the performance obligation is satisfied by the Group on the shipping or delivery
date. For service contracts such as maintenance contracts for medical related products, revenue is recognized equally over the contract period because
the performance obligation is considered to be satisfied over time. Revenue is measured at the transaction price of the consideration received or
receivable less discount, rebate and consumption taxes.
(9) Basis for translation of assets and liabilities denominated in foreign currencies
1) Foreign currency transactions
The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the entity operates(i.e., its functional currency). For the purpose of the consolidated financial statements, the financial results, financial position, and cash flows of eachgroup entity are presented in Japanese yen, which is the functional currency of the Group and the presentation currency for the consolidated financial
statements. In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign
currencies) are translated at the rates of exchange prevailing at the dates of the transactions.
At the end of each reporting period, monetary items denominated in foreign currencies are translated at the rates prevailing at that date. Non-monetary
items carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined.
Exchange differences are recognized in profit or loss during the period.
2) Financial statements of foreign operations
The assets and liabilities of foreign operations are translated into Japanese yen at the foreign exchange rates prevailing at the end of the reporting period.
The revenues and expenses of foreign operations are translated into Japanese yen at the average rates of exchange for the year. Where there are material
fluctuations in exchange rates, the exchange rate at the transaction date is used. Foreign exchange differences arising from translation are initiallyrecognized as exchange differences on translation of foreign operations in other comprehensive income and accumulated in “accumulated othercomprehensive income,” which are reclassified from equity to profit or loss on disposal of the net investment and included in “other expenses” or “otherincome” in the consolidated statement of comprehensive income.
5. Significant accounting estimates and judgments
In preparing the consolidated financial statements, the group management makes estimates and assumptions about the future. The estimates and assumptions
are based on management's best estimates, which consider historical experience and factors believed to be reasonable as of the end of fiscal year, may differ
from the actual results due to their nature.
The item for which management made estimates and judgments in the consolidated financial statements for the fiscal year that has a significant impact on the
consolidated financial statements for the following fiscal year is as follows.
Recoverability of suspense payments of income taxes
Amounts recorded in the consolidated financial statements for the fiscal year
Other current assets¥20,460 million
Other Matters
As described in “Note 3. Other Current Assets” to the Consolidated Statements of Financial Position, for each of the five fiscal years ended March
31, 2007 through 2011, the three fiscal years ended March 31, 2012 through 2014 and the four fiscal years ended March 31, 2015 through 2018,
the Company received a reassessment notice from the Tokyo Regional Taxation Bureau (“TRTB”) for additional taxes on the transfer pricing
taxation for transactions with overseas subsidiaries that develop and manufacture electronics-related products.
As a result of seeking withdrawal of the assessment in accordance with the relevant law, the Company received a written verdict from the National
Tax Tribunal (the “Tribunal”), which partially canceled the reassessments. However, the Company disagrees with the remaining findings of the
Tribunal’s verdict that maintains portions of the reassessment and expects to appeal the findings in court to seek cancellation of all thereassessments by the tax authorities. Consequently, the paid amounts of ¥7,916 million, ¥4,544 million and ¥8,000 million for each period were
capitalized as suspense payments of income tax.
Depending on the outcome of the lawsuit related to the cancellation of the reassessment, there may be a material impact on the consolidated
financial statements for the following fiscal year.

5Notes to the Consolidated Statement of Financial Position
1. Allowance for doubtful accounts directly deducted from assets
Trade and other receivables
Long-term financial assets¥2,667 million¥407 million

2. Accumulated depreciation of property, plant and equipment
Property, plant and equipment — net¥540,637 million
Accumulated depreciation includes impairment losses of property, plant and equipment.
3. Other current assets
On June 26, 2013, the Company received a reassessment notice from the TRTB for additional taxes on the transfer pricing taxation for transactions with overseas subsidiaries that develop
and manufacture electronics-related products for the five fiscal years ended March 31, 2007 to 2011. The Company has lodged an objection with the TRTB seeking withdrawal of theassessment in accordance with the relevant law.
On March 29, 2018, the Company received a written verdict from the Tribunal, which partially cancels the reassessments. The Company disagrees with the remaining findings of the
Tribunal’s verdict that maintains portions of the reassessment and the Company expects to appeal the findings in court to seek cancellation of all the reassessments by the tax authorities.
Consequently, the paid amount of ¥7,916 million is included in “Other current assets” as a suspense payment.
On June 27, 2018, the Company received a reassessment notice from the TRTB for additional taxes on the transfer pricing taxation for transactions with overseas subsidiaries that develop
and manufacture electronics-related products for the three fiscal years ended March 31, 2012 to 2014. The Company has lodged an objection with TRTB seeking withdrawal of theassessment in accordance with the relevant law.
On November 11, 2020, the Company received a written verdict from the Tribunal, which partially cancels the reassessments. The Company disagrees with the remaining findings of the
Tribunal’s verdict that maintains portions of the reassessment and the Company expects to appeal the findings in court to seek cancellation of all the reassessments by the tax authorities.
Consequently, the paid amount of ¥4,544 million is included in “Other current assets” as a suspense payment.
On June 29, 2021, the Company received a reassessment notice from the TRTB for additional taxes on the transfer pricing taxation for transactions with overseas subsidiaries that develop
and manufacture electronics-related products for the four fiscal years ended March 31, 2015 to 2018. The Company has proceed to appeal the findings in court to seek cancellation of all
the reassessments by the tax authorities.
On July 3 ,2023 the Company received a written verdict from the Tribunal, to dismiss the claim. The Company disagrees with the findings of the reassessment notice and expects toappeal the findings in court to seek cancellation of all the reassessments by the tax authorities. Consequently, the paid amount of ¥8,000 million is included in “Other current assets” as asuspense payment.
Notes to the Consolidated Statement of Comprehensive Income
1.Other Income
Gain on sale of shares of subsidiaries 3,458 million, Government grant 3,154 million, Valuation gain on financial liability 2,130 million, Litigation settlement 1,811 million wererecognized.
2.Impairment losses
The Group recognized impairment losses on groups of assets as follows:
Use
Location
Item
Impairment losses
EuropeAssets held for sale¥879 million
Idle assets and others
Asia
Machinery and others¥7,952 million
The Group recognized the amount decreased as impairment losses for any asset expected to be sold of, or any idle asset. European subsidiary wrote down the Assets held for sale to therecoverable amount, because it is expected to be sold lower than the carrying amount. Asian subsidiaries wrote down the asset group to the recoverable amount because the manufacturing
equipment is idle. The recoverable amount for the asset group are measured at fair value less costs of disposition.
3.Reclassification adjustments and tax effects related to other comprehensive income(1) Remeasurements of net defined benefit liability (asset)
Gains/ (loss) arising during the year¥(18) million

Tax-effect adjustment¥(6) million

Total¥(25) million(2) Assets measured at fair value through other comprehensive income
Gains/ (loss) arising during the year

¥2,236 million

Tax-effect adjustment¥(312) million

Total¥1,923 million(3) Exchange differences on translation of foreign operations
Gains/ (loss) arising during the year
Reclassification adjustments
Total amount before tax-effect adjustment
Tax-effect adjustment
Total¥66,218 million¥(1,120) million¥65,099 million¥(43) million¥65,055 million(4) Share of other comprehensive income of associates
Gains/ (loss) arising during the year

¥123 million

Reclassification adjustments¥(0) million

Total
Total other comprehensive income¥122 million¥67,076 million

Notes to the Consolidated Statement of Changes in Equity
1. Type and number of issued shares at March 31, 2024
Ordinary shares
350,958,720 shares
2. Dividend-related items(1) Dividends paid
1) Dividends resolved by the Board of Directors on May 24, 2023
・Total dividends¥23,009 million
・Dividends per share¥65
・Record date
March 31, 2023
・Effective dateJune 1, 2023
2) Dividends resolved by the Board of Directors on October 31, 2023
・Total dividends¥15,797 million
・Dividends per share¥45
・Record date
September 30, 2023
・Effective dateNovember 30, 2023

6

(2) Dividends whose record date falls within this fiscal year but the effective date falls within the next fiscal year
Dividends resolved by the Board of Directors on May 24, 2024
・Total dividends¥22,784 million
・Source of payment
Retained earnings
・Dividends per share¥65
・Record date
March 31, 2024
・Effective dateJune 10, 2024
3. Type and equivalent number of shares resulting from the potential exercise of stock acquisition rights outstanding at the end of the fiscal year (excluding the rights whose exercise
period has not yet commenced)
Ordinary shares
179,400shares

7Notes Concerning Financial Instruments
1. Items concerning financial instruments(1) Market risks
1) Foreign currency risk
The Group intends to marry major currencies the Group uses (Euro, U.S. dollar, and Japanese yen) in settlements of receivables/payables resulting from operating activities.
Specifically, the subsidiaries that continuously conduct import or export transactions retain foreign currencies obtained from exports of goods for payables on imported
supplies. This enables the Group to mitigate foreign currency risk. Additionally, the Company, having multiple SBUs that conduct finance and dividend transactions, andholding companies that receive dividends from their subsidiaries and distribute them to the Company and/or other Group companies, sometimes falls into a disparity offoreign currency debt-credit balances in receivables, liabilities, and/or bank deposits. This might cause significant gains or losses on foreign exchange differences when theJapanese yen appreciates or depreciates against the U.S. dollar or the Euro, or when the Euro appreciates or depreciates against the U.S. dollar.
The Group’s policy generally does not permit the use of derivative instruments such as forward foreign exchange contracts. However, in certain circumstances in which theuse of such derivatives is determined to be beneficial, the Group may enter into contracts upon obtaining formal approval from the Chief Financial Officer (“CFO”) of theGroup in accordance with its Group headquarters approval process. For instance, in order to hedge foreign currency exposures on intercompany receivables, payables, anddividends, the Company occasionally enters into forward foreign exchange contracts.
2) Interest rate risk
The portion of the interest-bearing debt in financing is small. Therefore, the interest rate risk is insignificant.
3) Price risk in equity instruments
The Group is exposed to equity price risks arising from equity instruments (i.e., listed shares). These investments are held as part of business strategy, not for short-term
trading purposes. The Group does not sell these investments frequently and periodically reviews the fair value of these instruments as well as the financial condition of
investees.
(2) Credit and liquidity risks
The Group manages its credit risk by setting credit limits that are approved by the authorized personnel of each SBU.
Ultimate responsibility for liquidity risk management rests with the CFO of the Group, who is appointed by the Board of Directors. Based on the instructions from the CFO, thefinancial headquarters of the Group mainly manages the Group’s liquidity risk by maintaining an appropriate level of retained earnings and credit facilities and monitors the actual
cash flows and forecasted cash flows. The credit lines for commercial paper are secured for temporary cash shortages due to dividends or bonus payments.
2. Notes concerning the fair value of financial instruments
As of March 31, 2024 (the end of the fiscal year), the carrying amount of financial instruments in the consolidated statement of financial position, the fair values of those
instruments, and the differences between them were as follows:
The carrying amount in the consolidated statement and the fair value are approximate.
(Millions of yen)
Carrying amount in the
consolidated statement offinancial position*
Long-term financial assets

Fair value*

Difference

45,70645,561(145)

Total assets

45,70645,561(145)

Interest-bearing long-term debt

(1,560)(1,460)100

Other long-term financial liabilities(24,801)(20,752)

4,049(26,361)(22,212)

4,150

Total liabilities* The balances of liabilities are presented as the numbers in parentheses.

3. Notes concerning the breakdowns of financial instruments by fair value hierarchy
The fair value of financial instruments is categorized into Levels 1 to 3 depending on the observability and importance of inputs from which the fair value was derived.
Level 1: Fair value derived from quoted prices in active markets for identical assets or liabilities.
Long-term financial assets classified as Level 1 consist of listed shares and are measured by market prices.
Level 2: Fair value derived from inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e., as prices) or indirectly (i.e.,
derived from prices).
· Fair value of long term financial assets such as long-term loans to subsidiaries and affiliates and lease deposits are measured by the present value of future cash flows ofeach loan categorized according to a certain range of term and discounted by the risk-free rate, etc.
· Fair value of interest-bearing debt and other financial liabilities such as long-term guarantee deposits and long-term other payables is measured by the present value of
future cash flows of each debt categorized according to a certain range of term and discounted by the interest rate that reflects the remaining period to the maturity and credit
risk.
Level 3: Fair value derived from inputs for the asset or liability that are not based on observable market data (unobservable inputs).
·Long-term financial assets classified as Level 3 mainly consist of unlisted shares and are measured using valuation techniques such as net asset approach, discount cash
flow method or comparable company method.
·Trade and other payables and other long-term financial liabilities classified as Level 3 consist of contingent considerations and are measured based on the achievement of
milestones considering time value of money.
(1) Financial instruments that are measured at fair value(Millions of Yen)
Level 1Long-term financial assets

Level 2

Level 3

Total

326

－

38,08438,409326－

38,08438,409Trade and other payables*

－

－

(387)

(387)

Other long-term financial liabilities*

－

－

(8)

(8)

－

(395)

(395)

Total

－
Total
* The balances of liabilities are presented as the numbers in parentheses.
(2) Financial instruments that are measured at fair value on a non-recurring basis(Millions of Yen)
Level 1Long-term financial assets

Level 2－

Level 3

Total

7,152

－

7,152

Total

－

7,152

－

7,152

Interest-bearing long-term debt*－(1,460)－(1,460)

Other long-term financial liabilities*－(20,743)－(20,743)(22,203)－(22,203)－
Total* The balances of liabilities are presented as the numbers in parentheses.

8Notes Concerning Revenue recognition
1. Disaggregation of Revenue from Contracts with Customers
Revenues and results from continuing operations by the Group’s reportable segments are as follows.
(Millions of Yen)
Japan

Asia

Americas

EuropeOthers

Total

Life Care
Health Care related products

129,704

57,566

94,934

Medical related products

23,971

22,344

31,799Life Care total

153,676

79,910126,734

Electronics related products

12,343

160,139

13,528

Imaging related products

10,077

26,663

1,519

22,420186,801

15,047

978

802

939

177,074

267,514142,720

104,6706,786

393,661

53,253

4,996

136,363

157,923

11,782530,024

3,263

1

189,274793

2

39,0544,056

3

228,328

1,539

－

4,259

163,518

11,784

762,610

Information Technology

Information Technology total
Other
Total revenue from external customers

2. Basic information to understand Revenue from Contracts with Customer
Please refer to (8) Revenue recognition of 4. Items related to accounting policies, Important items for the preparation of the consolidated financial statements
3. Information to understand Revenue amount for the current consolidated fiscal year and for the following consolidated fiscal year and thereafter(1) Contract balances
Receivables from contracts with customers and contract liabilities are as follows. Contract liabilities consist mainly of advance received and advance received profit from customers.
Contract liabilities increase by the receipt of consideration from a customer before the transfer of a good or service to the customer and decrease by satisfaction of the performanceobligation.
((Millions of Yen)

Contract balance
Receivables from contracts with customers

149,953

Contract liabilities
7,353
Note: Revenues recognized in the years ended 31 March 2024 that were included in the contract liability balances as at 1 April 2023 were 4,122 million yen.
Amount of revenue recognized in this reporting period from performance obligations satisfied (or partially satisfied) in previous periods is immaterial.
(2) Transaction price allocated to the remaining performance obligations
The Group uses the practical expedient of omitting the disclosure of information on the remaining performance obligations because it has no significant transactions with individual
expected contractual terms exceeding one year. In addition, no significant considerations from contracts with customers are included in the transaction price and no significant
financing components are included in consideration from contracts with customers.
(3) Assets recognized from the costs to obtain a contract with a customer
If the amortization period of the assets is one year or less, the Group uses the practical expedient of recognizing the incremental costs of obtaining the contract as an expense whenincurred.

Notes to per Share Information(1) Equity per share attributable to owners of the Company(2) Basic earnings per share¥2,760.91¥515.48

Notes Concerning Significant Subsequent Events(Repurchase of Shares)
The Board of Directors made a resolution to repurchase shares on May 15, 2024 based on Article 39 of Articles of Incorporation and Article 459.1 of the Companies Act of Japan as
outlined below.
1. Reason for Share Repurchase
The Company decided to acquire its own shares with the aim of shareholders' benefit, improving capital efficiency and ensuring a flexible capital policy.
2. Outline of Share Repurchase(1) Class of shares: Common stock(2) Number of shares to be repurchased: 3,000,000 shares (maximum)(0.86% of total shares outstanding, excluding treasury shares)(3) Total amount to be paid for repurchase: 50,000 million yen (maximum)(4) Period of share repurchase: May 16, 2024 through August 15, 2024
(5) Method of repurchase: Purchase on the Tokyo Stock Exchange based on discretionary investment contract(6) Others: Purchased stocks are planned to be cancelled with the aim of shareholders' benefit.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~(Note) Figures in the consolidated financial statements and related notes are rounded to the nearest unit.

9Notes to the Nonconsolidated Financial Statements
Significant Accounting Policies
1. Basis and methods for evaluation of marketable and investment securities
Investment securities in subsidiaries and affiliates: Cost determined by the moving-average method
Available-for-sale securities:
Marketable securities: Fair value, with unrealized gains and losses, net of applicable taxes, reported in a separate component ofequityNon-marketable securities: Cost determined by the moving-average method
2. Basis and methods for evaluation of derivatives: Fair value
3. Basis and methods for evaluation of inventories: Primarily the lower of cost, determined by the average method, and net realizable value
4. Methods of depreciation of fixed assets:
Property, plant and equipment(excluding leased assets)
Intangible fixed assets(excluding leased assets)
Leased assets

Depreciation is computed by the declining-balance method while the straight-line method is applied to buildings acquired on orafter April 1, 1998 and building improvements and structures acquired on or after April 1, 2016.
The range of useful lives is principally from 15 to 50 years for buildings, from 4 to 15 years for machinery and equipment, andfrom 2 to 15 years for tools, equipment and fixtures.
The straight-line method is applied. The period of amortization is 8 years for patents and 5 years for software.
The straight-line method over the lease terms with no residual value is applied for leases that do not transfer ownership of theleased assets to the lessee.

5. Basis for the conversion of foreign currency assets and liabilities
All short-term and long-term monetary receivables and payables denominated in foreign currencies are translated into Japanese yen at the exchange rate at the nonconsolidated balance
sheet date. The foreign exchange gains and losses from translation are recognized in the nonconsolidated statement of income.
6. Allowance, reserves, and provisions(i) Allowance for doubtful accounts(ii) Accrued bonuses to employees(iii) Warranty provisions

The allowance for doubtful accounts is provided based on the Company’s past experience of credit loss and an evaluation of
the financial position of borrowers.
Accrued bonuses are provided at the year-end to which such bonuses are attributable in the current year.
Accrued warranty cost is estimated and recognized based on past experience of the occurrence of defective goods and the
expected after service costs in the warranty period.
Reserve for periodic repairs is provided based on the actual expenses for the latest repairs for melting furnaces.

(iv) Reserve for periodic repairs
7.Revenue recognition
The Company recognizes revenue based on the five-step approach below:
Step 1: Identify the contracts with customers
Step 2: Identify the performance obligations in the contract
Step 3: Determine the transaction price
Step 4: Allocate the transaction price to the performance obligations in the contract
Step 5: Recognize revenue when the entity satisfies a performance obligation

The Company sells healthcare related products, medical related products, electronics related products, imaging related products, etc. and recognizes revenue when the control of products istransferred to the customer and the performance obligation is satisfied by the Company on the shipping or delivery date. For service contracts such as maintenance contracts for medical
related products, revenue is recognized equally over the contract period because the performance obligation is considered to be satisfied over time. Revenues is measured at the transaction
price of the consideration received or receivable less discount, rebate and consumption taxes.
Notes to Significant accounting estimates and judgments
In preparing the financial statements, management makes estimates and assumptions about the future. The estimates and assumptions are based on management's best estimates, which
consider historical experience and factors believed to be reasonable as of the end of fiscal year and may differ from the actual results due to their nature.
The item for which management made estimates and judgments in the financial statements for the fiscal year that has a significant impact on the financial statements for the following fiscal
year is as follows.
Valuation of equity securities of subsidiaries and associates and investments in subsidiaries and affiliates
Amounts recorded in the financial statements for the fiscal year

Equity securities of subsidiaries and affiliates ¥139,837 million.
Investments in subsidiaries and affiliates¥18,686 million
Other Matters
The Company assesses the impairment of equity securities of subsidiaries and affiliates and investments in subsidiaries and affiliates without a market price by comparing
the acquisition cost with the actual value. The Company’s policy is to write down the book value to the actual value, when the actual value declines by 50% or more fromthe acquisition cost. The actual value is estimated based on the business plans of subsidiaries and affiliates and other factors. However, such estimates may affect the financial
statements of the following fiscal year, if the business plans and other revisions are required to be modified due to change in uncertain economic conditions or other factors
in the future.

Notes to Revenue Recognition
Basis on comprehension of Revenue is set forth in "Significant Accounting Policies 7. Revenue recognition."
Notes to change in presentation
Nonconsolidated Statement of Income“Loss on valuation of shares of subsidiaries and affiliates of ¥120 million” and “Extra retirement payments of ¥50 million” which were included in “Others” in Extraordinary losses in theprevious year, are presented separately because the amounts became material.

Notes to Nonconsolidated Balance Sheet
1. Accumulated depreciation of property, plant and equipment¥104,701 million

Accumulated depreciation includes accumulated impairment losses.
2. Monetary receivables from and payables to subsidiaries and affiliates (excludingclassified items in the nonconsolidated balance sheet)(1) Short-term receivables(2) Long-term receivables(3) Short-term payables

Notes to Nonconsolidated Statement of Income
1. Transactions with subsidiaries and affiliates(1) Sales(2) Purchases including commissions(3) Non-operating transactions¥24,486 million¥17 million¥20,848 million¥83,622 million¥35,344 million¥14,185 million

10Notes to Nonconsolidated Statement of Changes in Equity
Matters relating to the number of treasury shares
Share class
Ordinary shares

Balance at April 1, 2023
2,972,069 shares

Increase

Decrease

3,550,176 shares

6,085,000 shares(Note)
Details of the increase and decrease in the number of treasury shares are as follows:
Increase due to repurchase of shares:
Increase due to repurchase of odd-lot shares:
Decrease due to cancellation of shares:
Decrease due to sale of shares
Decrease on exercise of stock options:

3,549,600 shares
576 shares
6,001,800 shares
3,600 shares
79,600 shares

Notes Relating to Tax Effect Accounting
Breakdown of deferred tax assets and deferred tax liabilities that resulted in an accrual as of March 31, 2024
Deferred tax assets
Valuation loss on shares of subsidiaries and affiliates¥5,638 million
Accrued bonuses
1,361Enterprise tax payable
619
Valuation loss on investment securities
949
Valuation loss on inventories
482
Asset retirement obligations
448
Excess of allowance for doubtful accounts
595
Impairment losses
369
Stock options
397
Excess of depreciation
217
Accrued social insurance premiums
204
Reserve for periodic repairs
134
Others92
Deferred tax assets – subtotal
11,505
Valuation allowance(7,244)

Net amount of deferred tax assets¥4,261

Deferred tax liabilities
Unrealized gain on available-for-sale securities
Expenses related to disposal of asset retirement obligations
Reserve for advanced depreciation of fixed assets
Total amount of deferred tax liabilities
Net amount of deferred tax assets¥ (52) million
(86)
(17)
(154)
¥4,107

11

Balance at March 31, 2024
437,245 shares

Notes Concerning Transactions with Related Parties
1. Subsidiaries and affiliates
Type

Subsidiary

Name of related parties

HOYA ELECTRONICS
SINGAPORE PTE. LTD.

Ratio of voting rights

Direct ownershipof 100.00%

Relationship withrelated parties

Transaction details(Note 4)

Sales and supplier
Concurrent post of
directors (Note 1)

Transaction amount(Millions of yen)

Purchase of
products

10,334

Sales of products

37,214

Rendering ofservices

3,970

Balance sheet item

Balances due to orfrom related parties(Millions of yen)Accounts payable– tradeAccounts receivable– tradeAccounts receivable– other fromaffiliates

2,536
9,783
1,217

Subsidiary

HOYA LENS THAILAND
LTD.

Indirect ownershipof 100.00%

Research anddevelopment
Concurrent post of
directors (Note 1)

Rendering ofservices

2,505

Accounts receivable– other fromaffiliates

9,704

Subsidiary

Chongqing MasTek
Electronics Co Ltd.

Direct ownershipof 60.00%

Supplier
Concurrent post of
directors (Note 1)

Advance receipt ofequipment purchase
price

1,025

Advance received

4,974

Subsidiary

HOYA
TECHNOSURGICALCORPORATION

Direct ownershipof 100.00%

Management offunds
Concurrent post of
directors (Note 3)

Borrowings andloans of funds
through cash
pooling

7,401

Deposit received

9,085

Indirect ownershipof 100.00%

Borrowing funds
Concurrent post of
directors (Note 1)

Borrowing funds

43,962

Short-termborrowings fromsubsidiaries andassociates

43,962Loans of funds(Note 5)

Incorporation ofdeferred interest
receivable into
principal

170

Loans receivablefrom subsidiaries
and affiliates

9,280

Interest received－

Accrued revenue

2,831

Subsidiary

Affiliate

HOYA FINANCE JPY B.V.

AvanStrate Inc.

Direct ownershipof 46.57%

Concurrent post of
directors (Note 2)(Note) Terms and conditions of transactions and the policies for determining them:
1. Employees of the Company concurrently serve as directors of the subsidiaries.
2. Employees of the Company concurrently serve as outside directors and outside auditors of the affiliate.
3. Executive officers of the Company concurrently serve as directors of the subsidiaries and employees of the Company concurrently serve as auditors.
4. Transaction price is determined by negotiation, considering market prices and other factors.
5. Interest rates on loans are determined considering market rates.
The deferred interest receivable, which is calculated on the unpaid principal based on deferred interest rates, is incorporated into principal.
The due date of the AvanStrate loan is December 27, 2023. It will be repaid in six installments after a certain period of deferment, and deferred interests will be paid by lump-sum
payment on the due date. The full unsettled amount is the balance to be collected within one year.
The full unsettled amount is the balance to be collected within one year. Platinum and other assets owned by a subsidiary of the affiliate are pledged as collateral.
2. Directors, officers, and major individual shareholders
Type

Name of related parties

Ratio of voting rights

Relationship withrelated parties

Transaction details

Transaction amount(Millions of yen)
(Note 3,4)

Balance sheet item

Balances due to orfrom related parties(Millions of yen)

Directors andofficers

Ikeda Eiichiro(Held)
Direct ownershipof 0.00%

Director andrepresentative
executive officer of theCompany

Performance shareunit issuance(Note 1)24－－

Director andrepresentative
executive officer of theCompany

Exercises of stock
options(Note 2)59－－

Ryo Hirooka(Held)
Direct ownershipof 0.00%

27

－

－

－

Executive officer of
the Company(Note 5)

148

－

－

Directors andofficers

Directors andofficers

Augustine Yee

Performance shareunit issuance(Note 1)
Exercises of stock
options(Note 2)

(Note) Terms and conditions of transactions and the policies for determining them:
1. Performance share unit were issued in accordance with the contracts at the date of options granted.
2. Stock options were exercised in accordance with the contracts at the date of options granted.
3. The transaction amount of Performance share unit is the amount of cancelled treasury stocks in the current fiscal year.
4. Transaction amounts are amounts paid upon exercise of stock options in the current fiscal year.
5. The executive officer retired at the first board of directors meeting after the shareholders meeting held on June 23, 2023. The transaction took place during the term as an executive
officer.

12Notes to per Share Information(1) Net assets per share(2) Basic earnings per share¥705.53¥135.70

Notes Concerning Significant Subsequent Events(Repurchase of Shares)
The Board of Directors made a resolution to repurchase shares on May 15, 2024 based on Article 39 of Articles of Incorporation and Article 459.1 of the Companies Act of Japan as
outlined below.
1. Reason for Share Repurchase
The Company decided to acquire its own shares with the aim of shareholders’ benefit, improving capital efficiency and ensuring a flexible capital policy.
2. Outline of Share Repurchase(1) Class of shares: Common stock(2) Number of shares to be repurchased: 3,000,000 shares (maximum)(0.86% of total shares outstanding, excluding treasury shares)(3) Total amount to be paid for repurchase: 50,000 million yen (maximum)(4) Period of share repurchase: May 16, 2024 through August 15, 2024
(5) Method of repurchase: Purchase on the Tokyo Stock Exchange based on discretionary investment contract(6) Others: Purchased stocks are planned to be cancelled with the aim of shareholders' benefit.

~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~(Note) Figures in the nonconsolidated financial statements and related notes are rounded to the nearest unit.

13