ESG Round Table- Continue to lead the vending machine market DyDo Group Holdings, Inc.
(Prime Market of the Tokyo Stock Exchange: 2590)

October 19, 2022

Table of Contents

01
02

Efforts to achieve Group Mission 2030

P.03

Aiming for the top runner in the vending machine market

P.11

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01 Efforts to achieve Group Mission 2030

3

The DyDo Group’s purpose for existing
Offering delicious products for sound mind and body

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4

Group Mission 2030
Formulated in January 2019 as an ideal of where, and what, we want to be in 2030

For DyDo Group to create enjoyable,
healthy lifestyles for people around the world
Together with our customers.
Nurturing our customers’ health
We will deliver products and services that help improvehealth and quality of life for our customers around theworld, in a tireless quest for delicious taste.

Together with the next generation.

Together with society.
Taking the lead in social reform
We will take the lead in social reform, going beyond
conventional wisdom to adopt new perspectives forachieving a sustainable society.

Together with our people.

Creating new value for future generations

Connecting people to people

We will take advantage of innovative technologies,
bringing surprise and delight to all of our stakeholders.

We will seek out new ways to form mutually beneficial
relationships with stakeholders, both old and new, within
and outside the company, working flexibly with them andrespecting the diversity of their values and abilities.

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5

Group Mission 2030: Key Performance Indicators
We will raise social value, environmental value, and economic value to achieve sustainable growth▐ Social value

We will contribute to the achievement of a sustainable society where people around the world can haveenjoyable, healthy lifestyles

For DyDo Group to create enjoyable,
healthy lifestyles for people around the world▐ Environmental value
We will aim to make our vending machine businesscarbon neutral by 2050 (for both direct emissions andthrough generating the electricity the machines use*1)▐ Economic value
We will aim to improve our corporate value in themedium to long term

We will aim to make emissions (Scope 1 and 2)
by the Domestic Beverage Business*2

Consolidated ROIC in FY2029

carbon neutral by 2030

8% or higher

We will aim to cut CO2 emissions (Scope 1 and 2) for major Japanese groupsubsidiaries*3 by half*4 compared to 2020 levels by 2030

*Invested capital is the amount put into in the business segments*1 CO emissions produced by vending machines operated by DyDo Beverage Service (Scope 3)2* 2 DyDo DRINCO, DyDo Beverage Service, and DyDo Business Service* 3 DyDo DRINCO, DyDo Beverage Service, and DyDo Business Service, DAIDOYakuhin, TARAMI corporation* 4 Calculated by dividing the total emissions for relevant group companies by total sales

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6Business Portfolio
We are promoting a business portfolio strategy that will help us to get to where, and what, we want to be in 2030
High

Cultivate these as main drivers of future
profit from a long-term perspective
Expansion of our businessoverseas

Sales growth rateInternational
Beverage Business（Turkey, China,
Other regions）

Medium-term improvements to growthpotential and profitability

Development of a second major source of revenue in non-drink businesses

Domestic
Beverage Business

Orphan DrugBusiness（ DyDo DRINCO /Supplement*）（DyDo Pharma）

Pharmaceuticalrelated Business（ DAIDO Yakuhin）

Food Business（Tarami）

low（ DyDo DRINCO/Beverage）
Innovation in the Domestic
Beverage Business

Growth direction

low

Domestic
Beverage BusinessProfitability（ROIC)High* As home shopping sales of supplements are currently being developed by DyDo DRINCO, they belong to the Domestic Beverage Business segment for accounting purposes.

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7

Designating Material Issues to Get to Where, and What, We Want to Be in 2030
DyDo Group
Corporate Philosophy

Creating happiness and prosperity, together with people and with society.
To achieve this goal, the DyDo Group will continue to embrace new challenges in a dynamic way.

Strengths and values we have held
since our founding

Eight material issues aimed at sustainablegrowthWhere, and what, we want to be in 2030
2030年のあるべき姿

Closeness to customers andconsidering their perspectives

Growth Strategies

Delivering products
customers want in theclosest and mostconvenient locations

Our spirit is applicable to the SDGs
principle of “leaving no one behind.”

Organizational Foundation
Business growth throughpartnerships

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8Designating Material Issues to Get to Where, and What, We Want to Be in 2030
DyDo Group
Corporate Philosophy

Creating happiness and prosperity, together with people and with society.
To achieve this goal, the DyDo Group will continue to embrace new challenges in a dynamic way.

Strengths and values we have held
since our founding

Eight material issues aimed at sustainablegrowthWhere, and what, we want to be in 2030
2030年のあるべき姿

Closeness to customers andconsidering their perspectives

Growth Strategies

Delivering products
customers want in theclosest and mostconvenient locations

Our spirit is applicable to the SDGs
principle of “leaving no one behind.”

Organizational Foundation
Business growth throughpartnerships

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9

Roles the DyDo Group Should Fulfill for Society in 2030
We should deliver food and drink that is delicious for body and mind to create enjoyable, healthy lifestyles forpeople around the world

For DyDo Group to create enjoyable,
healthy lifestyles for people around the world
In the vending machine market,
we will provide new value throughconstantly taking on challenges
and co-creating and so continue
to lead the industry

We will produce medicines
for patients suffering from orphan
diseases for which there are currently
no treatment options
Offering delicious products
for sound mind and body

We will create global brands
that support the health of people
all over the world

We will be

We will utilize our fruits and jellies
to pursue great taste and health,
to make people happythe no. 1 contact manufacturer
in the health and beauty field

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10

Aiming for the top runner in the vending
02 machine market

11Business-related environments
It is inevitable for sustaining the vending machine business to address the decline in the workforce
Changes in the labor market

Trends in No. of vending machines▍Trends in the working population in Japan▍No. of vending machines and no. of deliveriesof new machines from the manufactures（Millions）(Data taken from the Ministry of Internal Affairs andCommunications’ census data and the National Institute ofPopulation and Social Security Research’s Population Projection
for Japan [estimated 2017], compiled by DyDo)
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*Data taken from the Ministry of Economy, Trade and Industry’s Yearbookof Current Production Statistics (Machinery Statistics) and from the Japan
Vending System Manufacturers Association, compiled by DyDo12

Efforts to gain an advantageous position in the vending machine market (1)We will push customer-oriented sales and maximize quality (per machine sales) and quantity (No. of machines)
Initiatives to increase in the number of vending machines

Initiatives to improve per machine sales

 Expand activities to develop new installation location

 Promote installations with potential for highper machine sales- Increasing in sales personnel

 Optimize product lineups and selling price foreach machine to maximize sales for eachlocation- Strengthening Inside Sales
 Evolution of customer-oriented sales▍Trends in no. of DyDo machines inoperation at the end of the fiscal year

5.5%
increase

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▍Raise individual productivity (newlydeveloped machines locations)▍Trends in per machine sales

8%
increase13

Efforts to gain an advantageous position in the vending machine market (2)We have mostly completed our construction of a smart operations structure, and we will continue to constantly
evolve it to meet the times and customers’ needs
Initiatives to provide greater value using smart operations
 Roll-out to all direct sales (DyDo Beverage Service, Inc.) sites completed in May 2022
 Maximize sales using data gathered by connecting all machines to the internet

Improve methods andspread these throughout
the company

Normalize tasks that do awaywith the unreasonable, thewasteful, and inconsistent

Issues are passed up via
supervisors and resolved

Spread awareness ofcorrect procedures basedon manuals

 Increase work efficiency and enable a variety of employees to engage in suitable work
 Make continuous improvements to optimize operations▍Smart operations concept

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Priority environmental targets for a recycling-oriented society
We established three priority environmental targets to help us make effective use of limited resources▐ Priority environmental targets for a recycling-oriented society▐ Empty-container collection rate

▐ Average service life of vending machines(Years)
15

Follow the link or QR code below to see more
about environmental considerations in thevending machine business
https://www.dydoghd.co.jp/en/sustainability/eco/vending_machine_business/
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10502014 2015 2016 2017 2018 2019 2020 2021 (FY)15

The Everyone Love the Earth Project Aims to Bring About a Decarbonized Society
We are promoting initiatives in conjunction with business partners in various aspects of the vending machine
business to help decarbonize society▐ CO2 emission reduction target to contribute todecarbonizing society▐ Actual CO2 emissions (FY2021)
Scope1
Scope2
Total
Scope3
Domestic Beverage
7,268
1,379
8,648
94,89086.8%
109.0%
89.7%
97.4%
Business
Pharmaceutical8,058
8,058
106.0%
106.0%
97.4%
related Business
8,199
8,199
Food Business104.7%
104.7%
Total

24,90424,904

94,890

99.3%

99.3%

97.4%

*Percentages are change from the base year

▐ Actual CO2 emissions: the sales intensity (FY2021)*1 CO emissions produced by vending machines operated by DyDo Beverage
2Service (Scope 3)* 2 DyDo DRINCO, DyDo Beverage Service, and DyDo Business Service* 3 DyDo DRINCO, DyDo Beverage Service, and DyDo Business Service,DAIDOYakuhin, TARAMI corporation* 4 Calculated by dividing the total emissions for relevant group companies bytotal sales
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Domestic Beverage
Business
Pharmaceuticalrelated Business
Food BusinessTotal

Scope1
Scope2Total
Scope3
0.06
0.01
0.07
0.80
84.9%

106.7%

87.8%

0.72

0.72

98.3%

98.3%

0.39

0.39

103.4%

103.4%

97.4%

0.17

0.17

0.80

96.9%

96.9%

97.4%

*Percentages are change from the base year

16Start of Development for Love the Earth Vendors
Taking our carbon neutral measures to be a fundamental value, we are developing added-value that meets customer
needs and allows us to start developing vending machines that can create a sustainable future with customers▐ Fundamental value
Using renewable energy non-fossil fuel certificatesequal to the amount of annual vending machine
electricity consumption, we will reduce CO2 emissions
for vending machines during operation to virtually zero▐ Example of added-value
Foresting project will help to conserve regions’ natural environments

Customers have expressed their desire for less plastic waste and inresponse we have expanded our line-up of aluminium bottle drink
products

Customers

We developed six products in the Love the Earth series
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Comprehensive Business Alliance Agreement for Vending Machine Businesswith Asahi Soft Drinks Co., Ltd.
We have decided to enter into a comprehensive business alliance agreement for vending machine business withthe aim of growing and developing each vending machine business to improve the corporate values of both.

 Pursue operational synergies from the integration of direct sales channels

 Expansion of customer contact points through cross-selling of products Reduce costs by OEM strategy

 Reduce environmental impact through efficient resource recovery

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Details of the Comprehensive Business Alliance (1)Pursue operational synergies from the integration of direct sales channels
 Establishment of a new company to promote the integration of direct sales channels
 Deploy smart operations ,in which DyDo DRINKO has the know-how, to improve operational speed, quality control
capabilities, and productivity
 Solving the challenges of future labor shortages and job security■DyDo Group Holdings,■DyDo DRINCO

After the establishment ofthe new company

66.6%■DyDo Beverage Service

NewCo
DynamicVending
Network

33.4%■Asahi Group Holdings■Asahi Soft Drinks

Established inJanuary, 2023

■DyDo Beverage Shizuoka■DyDo Vending Japan■Asahi Soft Drink Sales■MichinokuFigures are investment ratios; all figures not stated are 100%.
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■Kyushu Asahi Soft Drink Sales19

Details of the Comprehensive Business Alliance (2)Expansion of customer contact points throughcross-selling of products

Reduce costs by OEM strategy

 Cross-selling of products added from March 2023

 Outsourcing the manufacture of some of DyDo
DRINCO brand products to Asahi Soft Drinks’plants around 2023 and beyond.

Add
Reduce environmental impact through efficient
resource recovery
 We will commit to efficient resource recovery and to solve
social issues such as improving the horizontal recyclingrate of PET bottles with the aim of reducing environmentalimpact.
Add

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Aims of the Business Alliance
We will ensure a firm competitive advantage in the vending machine market through further evolution ofvending machine operations▐ Where, and what, we want to be
In the vending machine market, we will provide new value through constantly taking on challenges and co-creating andso continue to lead the industry▐ Initiatives aimed at achieving the goal of Mid-term Business Plan 2026
Enhance and expand
vending machinenetwork by promoting its
customer-oriented sales

Further advancement of its
smart operations*2 by using
cutting-edge technologies

Offering values to its customers through its
vending machines, which are our “store”
Expand thevalue we offer

Pursuing efficient andhigh-quality operations

Leveraging economies of scale throughpartnership with Asahi Soft Drinks*1 From FY2022 to FY2026*2 A term coined by our company to describe a new productive workflow based on a drastic improvement of the operations
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