Good morning everyone.
I’d like to start by thanking you for joining us at such an early hour.
Yesterday, the Company released earnings for the fiscal year ended December 2023, together
with the guidance for fiscal year 2024 and the new Medium-Term Business Plan.
We would like to use today’s presentation to go over these in detail.
Realized results were approximately half what the forecast called for, so we believe
stakeholders probably have a number of questions on this front.
We will address these to the best of our ability, so we welcome you to stay with us for theduration of today’s earnings brief, which is expected to go on for about an hour.
We would now like to begin today’s presentation, during which I will be addressing
stakeholders toward the end.

Good morning everyone. My name is Yasunori Sakamoto, Head of the Finance Management
Department at the Earth Corporation.
Starting in March, I will be taking on a new role within the Earth Group, so today marks my lasttime participating in the Company’s earnings briefings.

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Allow me to direct your attention to page 2, which contains the financial result highlights forthe fiscal year ended December 2023.
We registered 158 billion yen in sales, only slightly below the forecast amount.
This slight underperformance was due to the impact of the underperformance from Householdproducts, especially bath salts.
Conversely, Insecticides & Repellents - which is our core earnings driver - delivered a strong
performance meeting the forecast target, as did Total Health Care System.
We registered 63.62 billion yen in gross profit, which corresponds to 95.7% of the forecast
target.
This represents an underperformance, on account of the impact of an higher-than-expected
increase in raw material prices, which is an issue we have been facing for some time now, as
discussed in previous earnings briefings.
Another factor is the model mix, namely, an increase in the share of products with lower
margins in each category.
We registered 57.25 billion yen in SG&A expenses, which corresponds to 97.9% of the forecast
target and therefore represents an overperformance thanks to the execution of cost controls.
Please refer to the appendix for more information.
Putting all of these factors together, operating income came in at 6.37 billion yen, whichcorresponds to 79.6% of the forecast target.
We lowered guidance in November of last year, and these results exceeded the revised forecast
by 1.37 billion yen, as discussed in greater detail on the next page.

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As discussed at the time of the announcement of the revised forecast back in November, we
took somewhat of a conservative approach to the figures, especially when it came to theforecast for the market for bath salts within the Household products segment.
This accounted for most of this overperformance versus the revised targets.
In terms of expenses, while we had expected to limit these by 1 billion yen, realized results
came in above the forecast, as we were able to control expenses by 1.24 billion yen.
Overall, while the initial forecast set the operating income target at 8 billion yen, we announceda 3 billion yen downward revision in November 2023.
However, the actual decrease was less pronounced - 1.63 billion yen - so ultimately, we
registered 6.37 billion yen in operating income.

3

Next are the operating income change factors.
Starting from the top of the list with the decrease factors we have the item of soaring raw
material prices, which had a negative impact higher than expected by 750 million yen.
We carried out price revisions as a way to address higher raw material prices and other costs,
and these efforts bore fruit to a certain degree in Insecticides & Repellents.
However, price revisions in Household products were not very successful, so the effects of costpass-throughs fell short of our forecast by 440 million yen.
Excluding price revisions, we also registered a slight sales underperformance versus theforecast of 360 million yen.
The most significant decrease factor was our model mix, due to greater competition across
categories.
We leveraged limited-edition and special event products in a strategic manner, but wenevertheless saw a slight decrease in revenue.
In terms of the various expense items, these were in line with the forecast.

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Next, I would like to briefly go over sales by segment.
The segments of Insecticides & Repellents and Total Health Care System delivered higher sales
and achieved the forecast targets.
As I mentioned earlier, bath salts and other Household products underperformed in terms ofsales.
Mr. Furuya will be going over the details later on in this presentation.

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Last, as announced on January 29th, 2024, the Earth Corporation recorded a loss in thevaluation of shares in BATHCLIN Corporation Inc.
The business environment, assumptions, and demand situation have all changed considerablyfrom when we acquired shares in the company in 2012.
A delta has therefore emerged between the levels we assumed at the time of acquisition,although it should be said that we don’t see any issues as it relates to direct earnings power.
That being said, the delta between the equity book value and net assets widened beyond acertain threshold, triggering this loss on valuation of shares in subsidiaries and affiliates,
recorded in accordance with the Accounting Standard for Financial Instruments.
This only has an impact on non-consolidated results, as it has no impact on consolidated
results.
This concludes my presentation.
I would now like to yield the floor to Mr. Furuya, who will be reviewing COMPASS 2023, theoutgoing Medium-Term Business Plan.
Thank you for your time.

6Good morning, everyone. My name is Yoshiyuki Furuya, Executive Officer and Assistant to the
President, in Charge of Overall Management.
I would like to review the previous Medium-Term Business Plan, which we executed between
2021 and 2023.

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Shown here is the outline and main drivers of the outgoing plan.
As outlined in the colored bars on the left forming the letter “E,” the basic strategy for the
Medium-Term Business Plan was reforming the corporate compass & infrastructure andimproving earnings by expanding the profit foundation in Asia, ESG/Open Innovation, andgenerating cost synergies.

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We have reviewed each of these initiatives internally, and while we won’t be covering thedetails, we assess our efforts as having accomplished approximately half of the goals we set forourselves, leaving several issues that need to be addressed.
Here, we have set three categories: initiatives with results, initiatives in progress, and lastly,
initiatives not fully executed.
In terms of areas where we saw results, we have reforming the corporate compass andinfrastructure, especially as it pertains to updates in management accounting and revamping
our core system, both of which were completed according to plan.
Going forward, we now intend to deliver benefits from the use of these systems.
In terms of expanding the profit foundation in Asia, a positive result was the expansion of sales
and market share in Thailand and Vietnam.
Regarding initiatives in progress, we have exploring new market areas, namely Malaysia andthe Philippines.
We started cultivating these two countries as new markets, but this process is still underway
and hasn’t been completed.
In terms of ESG and Open Innovation, addressing issues contributing to the achievement ofSDGs is an area that requires efforts over the long term, and additionally, work is still ongoingin terms of the real-world implementation of MA-T, as this is a project that is still in theinvestment phase and requires a longer time frame.
Regarding initiatives not fully executed, we were unable to fully tackle the issues of reducing
product disposals and returns and generating cost synergies across the whole Earth Group.
We continued work on these areas, but since this wasn’t enough to fully address thesechallenges, we are reviewing the execution structure and will be carrying out fundamental
changes.

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Next is a review of the quantitative targets.
Sales met and slightly exceeded the forecast target, while operating income, on the other hand,came in considerably below the 14 billion yen forecast we formulated back in 2020.
Realized operating income results also fell short of the target for 2023 of 8 billion yen, so wefeel we let stakeholders down, for which we offer our apologies. While soaring raw material
prices and foreign exchange impacts did indeed constitute headwinds for us, this made it clear
to us that the Company needs to make improvements to its earnings structure. We will begoing over some of the issues that need to be addressed on this front, starting on the next
page.

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When considering the factors weighing down on profitability, this analysis is done on a
management accounting basis.
The graph at the bottom shows the trend in sales and gross profit margin over the three-year
period between 2021 and 2023, on a management accounting basis. Under this management
accounting basis, we divide things into five segments: Domestic Insecticides & Repellents,
Domestic Household Products, Overseas, Total Health Care System, and Others.
In terms of the domestic operations within Insecticides & Repellents, while this segment issomewhat sensitive to weather impacts, sales are on a gradual upward slope in this business,
which also continues to deliver high margins and is therefore the Company’s core earnings
driver.
Regarding domestic operations within Household products, this business faces a challenging
environment.
I will be going over the details later, but a market slowdown and challenges in the execution of
cost pass-throughs have led to lower profitability in this business.
Regarding the Overseas business, while there is some variance from country to country,
overall, we have been able to grow sales.
Lastly, the Total Health Care System business continues to deliver stable growth.

11I would now like to look at each business individually, starting with domestic operations within
Insecticides & Repellents.
This business has seen headwinds in the form of soaring raw material prices over the past two
years. Against this backdrop, we executed cost pass-throughs as the top manufacturer in thiscategory in Japan, allowing us to offset this decrease in profitability and also making acontribution to the scale of the overall market, as shown here on the vertical bar graph on theright. These efforts resulted in an increase in the Earth Corporation’s market share.
The product return percentage has improved, but we believe there is further room for
improvement. Taking these various factors into account, the Earth Group’s core earnings
source remains solid.

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Conversely, over the past two years, we have faced a challenging business environment whenit comes to domestic operations within Household products.
This business benefited from stay-at-home demand during the pandemic, but this surplus
demand has since dissipated following the reclassification of COVID-19 as a common infectious
disease, and furthermore, we are now seeing greater competition.
The Earth Group continued to lose market share every year since 2019 for our core categories
of bath salts and mouthwash products. This, coupled with the impact of soaring raw material
prices, made for a challenging situation.
Unlike with Insecticides & Repellents, we face a number of competitors for these products, withfierce competition for market share.
Against this backdrop, we were unable to deliver sufficient results from cost pass-throughs,
and were therefore unable to put a brake on a decrease in earnings resulting from higher raw
material prices.

13

We made inroads into new markets and expanded our lineup in existing ones during COVID, agood example being the launch of sanitizer products.
We had anticipated greater demand resulting from the pandemic and consequently launched
products in new categories, e.g., sanitizer and nursing care products, and household
detergents. Within these, we recorded some success cases, such as Bubbloon - shown here on
the right - which has received acclaim on social media and generated good sales, but the
majority of new products were negatively impacted by changes in the market environment,
leading to lower profitability. Dispersion is another issue, as we spread ourselves too thin byallocating resources to these various product launches.
There is therefore a need for us to focus on our core competencies when it comes to marketing
resources and enhance brand awareness in core categories, capturing consumer loyalty.

14

As I mentioned earlier, the Overseas segment delivered overall sales growth, with somecountries doing better than others.
In ASEAN, we are seeing steady sales growth in Thailand and Vietnam, and are still in an
expansion phase in the Philippines and Malaysia.
We saw strong results in the Export business, especially when it comes to exports to the Middle
East and Africa, and we expect further expansion going forward.
Conversely, we saw some weakness in the cross-border e-commerce business targeting the
Chinese market.
Lastly, as you are aware, we registered lower sales in China, on account of changes in theexternal environment in the region.

15

I would now like to go over each country and region within the Overseas business.
In Thailand, we are focusing on insecticides & repellents, air fresheners and deodorants, andmouthwash products. As it stands, the Earth Group currently holds the second largest market
share in the country for insecticides & repellents, and we are now aiming for the number 1 spotby 2025. We are currently enhancing efforts to guarantee the deployment of staple products
within MT and TT, and formulating focus SKUs for convenience stores and mom-and-pop storesand promoting the shipment of these to such stores. Lastly, we are working to enhance thebrand value of ARS in Thailand through initiatives to prevent the spread of dengue fever.
In Vietnam, we registered a strong performance from our core category of household
detergent products. Additionally, we have had success in growing the number of stores
carrying our insecticides & repellents, air fresheners and deodorants, and mouthwash products.
We established a local subsidiary in Malaysia in 2019, but were unable to carry out operations
as we had hoped, due to the pandemic. We are currently carrying out contract reviews with
distributors in order to rebuild sales channels, and our main efforts for the time being are
toward the introduction of staple products to main accounts and promoting the development of
new channels.
The Earth Group started business development in the Philippines following the execution of
M&A in 2022. Currently, we are working to introduce insecticides & repellents, with existing
channels and products as the core.
The Export business is divided into the three areas of Middle East, Taiwan, and North America.
In the Middle East, we brought an enhanced version of EARTH NO MAT to market in Saudi
Arabia, allowing us to grow results. In Taiwan, we saw success from the introduction of new
products, primarily insecticides & repellents. In North America, we are in the process of
expanding sales for cockroach control products.
Lastly, we face a challenging environment in China, amidst a market slowdown.
Cross-border, too, has struggled due to a slump in the livestream shopping market.

16

Total Health Care System is a recurring-revenue business capable of generating stableearnings, and is therefore one of the most important businesses in our earnings portfolio.
Annual contracts are the core for this business, with the number of contracts growing year in,year out - making for a strong earnings foundation. The main business here consists ofproviding consulting services to food processing plants to prevent cross-contamination andcontamination with foreign materials. There is robust demand for these types of services, andwe expect further growth going forward. Additionally, we are also in the process of expanding
into new areas.

17

My presentation thus far has followed the segments as outlined in our management accounting
framework.
The factors outlined in the current slide had a significant impact on results from domestic
operations within Insecticides & Repellents and Household products. The impact of soaring raw
material prices over the two-year period starting in 2022 totaled approximately 6 billion yen.
This wasn’t limited to higher prices for raw materials and packaging materials, as this impact
extended to a wide range of expenses, such as manufacturing and outsourcing expenses, etc.
This therefore had a significant impact on results. Additionally, seasonality plays a large role inour business and we stockpile production, meaning that there’s a time delay before the impactof higher raw material prices is actually felt. The market appears to have stabilized somewhat,
but we expect this negative impact to extend into 2024 when it comes to the Group’s results.
We carried out price revisions in order to offset these headwinds, but these efforts onlytranslated into a profit contribution of 2.1 billion yen, which corresponds to only approximately
one-third of the cumulative impact of higher raw material prices.
The plan is to execute price revisions this year as well, especially in the Insecticides &Repellents business. Naturally, we’re considering executing price revisions within Householdproducts. The right balance needs to be struck here, between possible price increases andefforts to recapture share and enhance our brand, but we are making preparations to move
forward with new efforts as soon as possible.

18

Next is a review of investment carried out during the Medium-Term Business Plan.
We raised 12.5 billion yen in equity financing in 2020 and initially intended to direct these funds
primarily toward investment to expand our profit foundation in Asia, investment in ESG andOpen Innovation, investment in ICT infrastructure and DX, and capex. In terms of realized uses,
we acquired BARTH through business transfer, as well as a local subsidiary in the Philippines.
We also carried out MA-T-related investment, revamped our core system, and expanded
production capacity for our Onpo bath salts, among other uses. The amounts invested in eachproject are as shown here on the table.

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I would now like to discuss a specific example of system investment allowing us to derive
benefits.
The revamping of our core system has allowed us to complete efforts to improve efficiency at
the SCM level. This system integrates and prepares all processes and data - from theproduction phase all the way to sales - functioning in tandem with earnings transparency by
category and business - made possible through updates in management accounting - andallowing for more sophisticated forecasting and management. We will reap the benefits bycarrying out portfolio restructuring with this system as a foundation.

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Last is a summary of this review.
As I mentioned at the beginning, over the course of the outgoing Medium-Term Business Plan, we
successfully carried out a number of initiatives, while also not being able to fully complete others.
Regarding the Overseas business, while it continues on an expansion trajectory, challenges related to
growth remain for each country and their respective business stages.
While we succeeded in delivering sales growth in the ASEAN region and the export business, we wereunable to achieve sales growth and market share expansion in China due to changes in the external
environment.
In Japan, Insecticides & Repellents continued showing unwavering strength as a core earnings driver,
although reducing product returns remains a challenge for this business. We were unable to fullycomplete cost pass-throughs for Household products, and this led to a worsening in profits. Progress wasmade in diversifying categories, with the objective of further growing the scale of our business, but thisled to dispersion in brand investment resulting in insufficient resources being allocated to our coreproducts of bath salts and mouthwashes. This was a factor behind a decrease in market share.
In terms of governance, we promoted system investment and the introduction of management
accounting, and put in place a foundation toward transformation going forward. We have completed thereform to our corporate compass and infrastructure, making it possible for us to leverage these tomonitor and manage business and category revenue in a timely manner.
By leveraging this, we seek to achieve portfolio restructuring, and addressing these challenges forms thebasis of the new Medium-Term Business Plan. I would now like to yield the floor to Mr. Goji, Head of the
Corporate Planning Department, who will be going over the details.

21

My name is Isao Goji, Head of the Corporate Planning Department.
Allow me to use this opportunity to go over the new Medium-Term Business Plan, whichstarted in fiscal year 2024.

22

As Mr. Furuya discussed in his review of the outgoing Medium-Term Business Plan, we fell
short of the profit target. We want to learn from these shortcomings by expressing a strong
commitment to achieving the profit targets we set for ourselves. This commitment is therefore
one of the defining features of this new three-year period. We will continue to transform andenhance the earnings structure while also carrying out proactive growth investment in Asia andin Household products in Japan.
First, allow me to talk about the Overseas business. This business consists of our operations inexports, Southeast Asia, and cross-border e-commerce, with each of these areas being indifferent stages of growth. The Overseas business beats the Domestic market in terms ofgrowth potential, and one of our strategies is to further accelerate growth here.
The second strategy item pertains to domestic operations. As we discussed earlier, both
domestic and overseas operations within Insecticides & Repellents continue to deliver and growstable earnings. On the other hand, we took a proactive approach to expanding the number ofcategories offered within Household products, with both positive and negative results
depending on the category. Furthermore, we invested in a large number of categories, leading
to an insufficient investment allocation to some categories. Against this backdrop, we intend towork to nurture Household products as a second revenue pillar while enhancing brandrecognition.
Third, within the scope of the previous Medium-Term Business Plan, we carried out system
investment and the fundamental review of management accounting. We made progress instreamlining, slimming down, and standardizing the Earth Group’s core businesses, and webelieve we have now put in place a foundation for us to build upon in our fundamental
transformation efforts. Against this backdrop, in fiscal year 2024, we intend to strengthen
overall Group governance and work to carry out restructuring conducive to generatingsynergies.

23Based on this analysis, we have formulated three concepts for the new Medium-Term BusinessPlan.
We position this three-year period as a preparation toward overall Group optimization efforts.
The first initiative will be executing structural transformation to enhance our earnings power.
Second, domestic operations will focus on driving profit and earnings, while overseas
operations will drive top-line growth.
Third, we will be generating Group synergies and executing Group restructuring to expand cash
flows.
We therefore position this Medium-Term Business Plan as a three-year period in preparation for
the rebirth of the Earth Group, which celebrates its 100th anniversary in 2025.

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Shown here are the main drivers of the new Medium-Term Business Plan.
The colored bars on the left forming the letter “E” represent the main drivers of the previous
Medium-Term Business Plan. This business plan focused on reforming the corporate compass
and infrastructure, and consisted of efforts to expand the profit foundation in Asia, ESG andopen innovation, and the generation of cost synergies. The new Medium-Term Business Planconsists of three main drivers. First and foremost is transforming the earnings structure.
Second is expanding sales overseas, and third is Group restructuring. We therefore position thisMedium-Term Business Plan as a three-year period during which to lay out the groundwork for
us to grow into a new and improved Earth Group around the Company’s 100th anniversary in
2025.

25

Here is the slogan for the new Medium-Term Business Plan.
We have updated the Medium-Term Business plan from Act for SMILE COMPASS 2023 to
COMPASS 2026. The new slogan is as follows: “Our Group Working Together Toward a Bright
Tomorrow for EARTH.” This slogan underscores the fact that these efforts are not just by the
Earth Corporation, but by the whole of the Earth Group - both in Japan and overseas - toward
the rebirth of the Earth Group.

26

This slide contains a bird's eye view of the Earth Group’s medium-to-long-term concept.
The upper portion of the diagram contains our slogan, with the left-hand side of the pagecorresponding to COMPASS 2023 and the outline for COMPASS 2026 shown in the middle.
Shown in red is the objective of driving the top line in the Overseas business. Within this, wewill work to expand our market share in Southeast Asia, cultivate markets in new countries,
and lastly, review businesses in countries that have been showing market weakness.
Shown in blue is the objective of rebuilding a robust earnings foundation in Japan, with a focus
on domestic operations within Insecticides & Repellents while shifting the business portfolio.
We will also be increasing investment in businesses and categories boasting high profitability,
and optimizing resource allocation to this end. In terms of the overall Group foundation making
possible the execution of these initiatives, we will be enhancing oversight of the domestic andoverseas businesses and also restructuring. At the same time, we will also look past justorganic growth, as we intend to take a proactive stance toward M&A, and we will also keep aclose eye on investment profitability.
The bottom portion of the diagram is actually the most important. Recently, we have seensomewhat of a decrease in profits, but this is merely a temporary decline resulting fromstructural transformation within the scope of the Medium-Term Business Plan. We expect toreturn to a strong upward trajectory in 2026 and beyond, with this three-year period being one
in which to put in place the necessary elements to allow for this leap forward.

27

I would now like to go over each of the main drivers of COMPASS 2026, starting withtransforming the earnings structure.
We continue positioning Insecticides & Repellents as our core earnings pillar, but will work to
expand categories capable of generating earnings in Household products. To this end, we will
be concentrating on our brand and SKU core competences to correct for the expanded productselection in this segment that took place over the course of COMPASS 2023. We took aproactive stance in terms of entering and expanding our offerings in some categories. Some ofthese categories feature too much competition, while others offer a path to success. Against
this backdrop, we want to execute a selection process to focus on promising strategic
categories while at the same time cutting down on the number of SKUs.
Second, as Mr. Furuya mentioned earlier, bath salts and oral hygiene products have facedsome headwinds recently. We believe we haven’t yet incurred damage in terms of the EarthGroup’s brand, but there is a need for us to increase the investment allocation to further
improve the power of our brand. As such, we are taking a proactive approach in this area, as
we intend to communicate a message fostering customer loyalty, although naturally, we willcontinue working to further improve the quality of the products we offer. Within the course of
these activities, we will work to raise unit values as soon as possible by raising the value of ourbrand. The goal isn't simply to carry out cost pass-throughs, but rather to further enhance ourbrand so that we can offer products with a value proposition commensurate with this value.

28

Continuing on the topic of transforming the earnings structure, we updated management
accounting over the course of the outgoing Medium-Term Business Plan and revamped ourcore system.
We intend to leverage these to reduce costs, first starting with reducing product return
percentages in domestic operations within Insecticides & Repellents. As Mr. Furuya mentioned
earlier, we believe there is still room for improvement on this front, and we have alreadyformulated a policy to proactively eliminate product returns and reduce product waste.
Furthermore, by further enhancing our procurement function for the overall Group and also
globally, we seek to advance cost reduction toward lowering the cost of goods sold.
Second, we already saw some results with the review of our supply chain system and businessprocesses, during the outgoing Medium-Term Business Plan. By further enhancing supply anddemand adjustment functions, we seek to achieve the automatic proposal of production plans,
minimize lost opportunities from product shortages, and optimize inventories to improve cash
flow from operating activities. Additionally, we will consider initiatives to reduce fixed andvariable expenses through the fundamental review of distribution operations, and reduce CO2
emissions.
Third, as we wrote here at the top, eliminating product returns is not something that can beachieved by Earth on its own, as it requires the cooperation of our customers and distributors.
We want to carry out industry-wide efforts in this area, and work together with customers, and,to this end, we intend to optimize marketing expenses. We seek to achieve this goal throughthe allocation review of advertising and sales promotion expenses and various initiatives towardeliminating product returns.

29

The second main driver is expanding sales overseas.
We are currently advancing efforts to grow the top line in the Overseas business, which boasts
a high potential, although naturally, we intend for this to be accompanied by profits, as well. In
Thailand, in particular, we are actively carrying out efforts to grow market share in the country,
as we aim for the top position in this market by next year. In Vietnam, as well, we are also
making good progress in expanding our market share in the country. In the Export business,
we will work proactively to expand our export network in North America, the Middle East Saudi Arabia, in particular - and Taiwan.
In terms of new countries, we already established local subsidiaries in Malaysia and thePhilippines during the outgoing Medium-Term Business Plan and advanced these businesses.
The business foundation is already in the process of falling into place, so we intend to further
accelerate growth going forward. Additionally, we want to revise our business strategy to focus
on earnings in China - which is showing market weakness.
As sales grow in the Overseas business, this will require a corresponding increase in production
capacity. In this area, and as I mentioned earlier, we will seek to leverage supply sources forthe overall Group and also globally in order to optimize the overall supply chain. Should theright conditions present themselves, we will also consider building up the manufacturing
structure including through the use of M&A. Lastly, personnel is indispensable in delivering
sales and business growth for the overseas business, and the main priority in carrying out aglobal shift in this area. As such, we will take a proactive approach to hiring and training global
human resources, as we position this as our main human capital management materiality.

30

The third main driver is Group restructuring.
Generating Group synergies was already a significant theme within the outgoing Medium-TermBusiness Plan, but as Mr. Furuya mentioned in his review, we weren’t able to conclude efforts
in this area. We want to learn from these shortcomings and execute Group restructuring
toward the generation of true synergies. A project toward Group restructuring has already beenlaunched internally, and we are in the process of making preparations to this end.
Furthermore, we will be taking a proactive approach to M&A, as well. In order to further
enhance our M&A efforts, there is a need to carry out initiatives such as the restructuring of along and short list of M&A projects, also including factors pertaining to overseas, newcategories, and venture capital investment. There is a need to strengthen the M&A framework
taking into account these factors, while also enhancing the PMI framework for theadvancement of synergies. Through these and other measures, the new Medium-TermBusiness Plan is a period to take a more proactive approach to M&A.

31

This page contains an overview of profitability and capital efficiency between 2020 and 2023.
The line graph on the left shows the trends in ROE, ROIC, and WACC, with a peak in 2021 anddeclining profitability in the years that followed. Within the new Medium-Term Business Plan,
we will therefore be transforming the earnings structure. The dotted line in blue shows WACC,
which has hovered around 5%. Following the equity financing we carried out back in 2020,debt utilization has been low, so we will be executing a capital strategy making sure we utilize
debt to some extent, also taking into account the cost of capital.

32

This slide contains an outline for the cumulative three-year period corresponding to the new
Medium-Term Business Plan.
First is cash flow from operating activities, which corresponds to our earnings power - shown
here in dark blue. We expect to generate approximately 27.5 billion yen in cash flow fromoperating activities, as well as approximately 30 billion yen in cash flow from investing activities- the section shown in red - with this amount being premised on the stable distribution ofdividends within shareholder returns. Naturally, these numbers aren’t fixed or final, but wehave plans to invest 30 billion yen, within which we intend to utilize capital and debt in a robust
way. Regarding the breakdown of this planned investment amount, the figures presented here,
too, are a provisional estimate.
Our first priority here is the execution of structural transformation, and we expect to allocate
between around 5 and 6 billion yen in investment capital to this end. Another item isinvestment in manufacturing infrastructure and IT and digital infrastructure. Up until now, theEarth Group has already invested an average of around 5 billion yen every year in this area,
and we have plans to continue this in the new Medium-Term Business Plan, for a total ofaround 15 billion yen. Next is investment in human resources, which we intend to carry out
outside the scope of regular expenses with personnel. Here, we have plans to further invest in
human resources within the scope of our Group restructuring efforts and efforts to advance a
global shift and digital transformation. Lastly, we are also considering setting aside around 10
billion yen in capital for future M&A.

33

This slide contains the quantitative targets for 2026.
The middle column shows realized results for fiscal year 2023, and immediately to the right wehave the forecast targets for 2026. We are targeting 170 billion yen in consolidated sales,
which corresponds to an increase versus 2023 results of 11.7 billion yen. Within this, we expect
Overseas sales to account for 25 billion yen. In 2023, Overseas sales accounted for 11.1% ofconsolidated sales, but we expect this percentage to grow to just over 14% by 2026. The
operating income target for 2026 is 7 billion yen, growing from 2023 levels. Naturally, we
expect the operating income margin to exceed 2023 levels as well, growing to 4.1%. Lastly,
the net income forecast is 4.3 billion yen.
Next, in terms of capital efficiency we have ROE, for which we expect an improvement over thisthree-year period. On the other hand, we expect ROIC to go down by 0.2 points during thesame period, and WACC to decrease by 0.5 points, as well. We therefore expect the
ROIC/WACC spread to improve by 0.3 points. Lastly, in terms of shareholder returns, we
intend to maintain a DOE level of around 4%.

34

Next are the plan highlights for 2024.
Fiscal year 2023 realized results are shown on the rightmost column, with the plan for fiscal
year 2024 shown on the left. We are targeting 165 billion yen in top line sales, 65.8 billion yen
in gross profit, 62.8 billion yen in SG&A expenses, and 3 billion yen in operating income. This
represents a year-on-year decrease in operating income of approximately 3.3 billion yen. We
expect approximately 1.8 billion yen in net income, down approximately 2.3 billion yen yearon-year. The main reason we expect lower profits has to do with SG&A expenses. Within SG&A
expenses, we expect 1.5 billion yen in expenses related to structural transformation, and 1.1
billion yen in investment in nurturing our brand. The highlights show an increase of 1.6 billion
yen in human resources, which is an item separate from investment in human resources, so I
would like to draw your attention to this distinction.
In summation, we expect to incur a number of temporary expenses, primarily expenses related
to structural transformation, but also higher cost of goods sold and market fluctuations. We
expect these will translate into a decrease in profits, but as we discussed earlier, we will be
putting in place a foundation allowing us to grow in 2026 and beyond, which is why we expect
to see somewhat muted results throughout the new Medium-Term Business Plan, andespecially in 2024.

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Next is a comparison between fiscal years 2023 and 2024, on a management accounting basis.
Here, we show the various management accounting categories, such as Domestic Insecticides& Repellents, Domestic Household products, Overseas, Total Health Care System, etc.
Insecticides & Repellents in Japan broke a new record last year, reaching a market size of over
130 billion yen. Our strategy here is to continue expanding our share and the top line within
this growing market. In terms of Household products, our strategy here is, as I mentioned
earlier, one of focusing on our core category competencies, while delivering top line growthand securing profits. Lastly, we expect to deliver robust growth in the categories of Overseas
and Total Health Care System. As such, while we expect lower profits in fiscal year 2024, wehave a firm commitment to structural transformation and to putting in place a robust
foundation allowing us to enhance our earnings power over the course of the new MediumTerm Business Plan. This concludes my overview of the new Medium-Term Business Plan. I
would now like to yield the floor to President Kawabata, who will be discussing the Company's
vision for the future, including the new Medium-Term Business Plan.

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So far, we have gone over the results and initiatives in fiscal year 2023, as well as thequantitative targets for fiscal year 2026, the specifics behind these targets, and the plan
highlights for fiscal year 2024. I would now like to use this opportunity to outline the EarthGroup’s vision for the future, for 2026 and beyond.

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The word “COMPASS” represents the Earth Group’s policy direction, so we have kept thenaming convention for the new Medium-Term Business Plan: Act for SMILE COMPASS 2026.
“Our Group Working Together Toward a Bright Tomorrow for EARTH” is our slogan, with Groupsynergies and restructuring as the major themes.Some might be of the opinion that these
efforts were long overdue, but we believe that the need to make these changes can no longer
wait, and this a sentiment we drew upon when coming up with the slogan for the new MediumTerm Business Plan.

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The acronym “COMPASS” was chosen to conjure a sense of direction in terms of Company
policy, but each letter actually has meaning as it pertains to our guiding principles. The letter“C” therefore stands for “Customer first,” “O” for “Open communication,” “M” for “Mind-set,”“P” for “Proactive challenge,” “A” for “Agility,” “S” for “Sustainability,” and “S” for “Smile.” At
the beginning of the current fiscal year, we conveyed to Earth employees the principles and themeaning behind the Medium-Term Business Plan, and are now in the process of diving deeper
into the details and execution at each of the companies that make up the Earth Group.

39Efforts to reform the corporate compass and infrastructure started with COMPASS 2023 and,within this, we had already decided on efforts to generate cost synergies across the EarthGroup. That being said, these synergies are premised on the successful revamping of
infrastructure, so we focused on this task first. Then COVID-19 came along, so ultimately, wewere unable to unlock Group synergies as we had originally intended.
We were unable to fully realize these plans, but carried out a number of efforts to reach targets
we could achieve on our own. As such, we succeeded in completing reform of the corporatecompass and infrastructure - including system investment - over the course of the outgoing
Medium-Term Business Plan. We will be building upon this revamped infrastructure during the
new Medium-Term Business Plan, and complete two main targets. The Overseas businessstands out as the engine for growth going forward, and this is a factor we already recognized in
the outgoing Medium-Term Business Plan, as we worked to expand the profit foundation in
Asia - efforts we perhaps should have started earlier. Now is the time to reap the benefits, andfurthermore, we have plans for further expansion into new areas. In other words, we now haveplans to advance the Overseas business to the next stage, accelerating sales generation, all thewhile naturally not neglecting profits. This is akin to our efforts in growing market share in
Japan over the years, as we work to drive sales in order to build a strong engine to drive
growth. This is our strategy for the Overseas business.
(Continue to next page)

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Delivering growth in the domestic Japanese market is by no means an easy feat. That being
said, we have been able to secure a robust earnings source, primarily in the form of theInsecticides & Repellents business, and we intend to continue these efforts going forward. We
have no intention to let our guard down on this front, but we already boast a market share ofaround 60% - despite the fierce competitive environment. As such, trying to capture an evenlarger piece of the pie is something that could require us to incur prohibitive and unnecessary
costs. This has become apparent, although by this we don’t mean we won’t work to deliver
growth, but rather our approach is that of maintaining an adequate market share allowing us tosecure profits. Doing this requires more than Insecticides & Repellents as a revenue pillar, so
we will be working to nurture Household products as a second pillar. We boast a market shareof close to 50% in the category of bath salts, so we will work to achieve a market share similar
to what we have with Insecticides & Repellents. Earlier, we mentioned our plans for a 30%
reduction in the number of SKUs tracked, and over the course of the new Medium-TermBusiness Plan we will be determining what categories to exit, freeing up resources to allocate toother areas. As such, our focus in the Domestic market will be squarely on profits, as opposed
to sales.
Additionally, we have plans to build a foundation across the whole of the Earth Group. As I
believe you are aware, the Earth Corporation is the core of our operations, but the Earth Groupalso consists of Hakugen Earth and BATHCLIN, with the Earth Environmental Service as aseparate entity within Total Health Care System. The three companies of Earth Corporation,
Hakugen Earth, and BATHCLIN have generated some intra-Group synergies over the past
decade or so, and we intend to restructure efforts in this area as well. We also have plans toclose unprofitable manufacturing plants. These are therefore the main drivers within the new
Medium-Term Business Plan. Completing these goals over the course of COMPASS 2026 willallow us to progress to the next Medium-Term Business Plan after that, in 2027 and beyond,with a structure adapted to current times and the external market environment, and allowing
us to deliver robust profits. We have plans and strategies to this end, and - at the risk ofsounding overly dramatic - for COMPASS 2026, we were faced with two choices: we could
either neglect to unlock Group synergies and restructuring and therefore deliver results in linewith fiscal year 2023’s performance, or withstand some short-term pain in fiscal year 2024 inorder to grow later on. I chose the latter option.

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Next is our vision for 2030. Naturally, this includes efforts in Japan, as well, but we will aim tobecome one of the top 5 manufacturers of Household products in Asia by 2030. We have
conveyed this message internally to employees at the Earth Group, in a forward-looking
manner. Earth is already number three in Insecticides & Repellents, so we will be putting inplace a foundation allowing us to secure the number two spot, and we believe growing ourmarket share in each country to be important in achieving this. We currently hold the number
one spot in Japan, and we believe we will be able to secure the number one spot in othercountries for the first time as well during COMPASS 2026, as we work to expand our share indifferent regions whenever possible. As I mentioned earlier, during COMPASS 2026, we will
carry out a selection process across all categories in Household products, in order to focus on
our core competencies. Our vision also includes human resources and enhancing ourmanagement foundation, and indeed, employees are everything, so we will work to address
their needs. This is a bit of a chicken and egg situation, but we will work to secure humanresources into the future.

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Last is the earnings structure target for 2028.
Admittedly, 2028 is still rather far away, but we believe in formulating specific quantitative
targets, as we did here on the right-hand side of the page, which contains a comparison
between the estimates for 2026 and 2028. As you can see, one of our targets going forward isreducing the cost of goods sold margin. As Mr. Furuya mentioned earlier, higher inputs
translate into an increase in the cost of goods sold, but this impact happens with a lag ofaround a year. This is because we procure all the necessary materials and inputs one year inadvance, so a difficult issue we face this fiscal year stems from the fact that we had to procure
inputs at peak prices. This time lag is a feature of our operations, and we expect this time lagof approximately one year to continue into the future.
We have plans to carry out more cost pass-throughs from price revisions in our core categories
this fiscal year, so ultimately, we intend to reduce the cost of goods sold margin by 1.5 points.
Against this backdrop, we also ultimately expect to be able to reduce SG&A expenses and aim
for an operating income margin around 8%, or more specifically, for an improvement of 3
points, which should put us at just over 7%. These are quantitative targets, and we believethese are within reach following the execution of structural transformation and Group
restructuring.
The message I would like to drive home to stakeholders the most is that now that the
pandemic is behind us, and taking into account the business and consumption environment inJapan, this three-year period is the time to put in place a structure allowing us to realize
continued, sustained growth. Rather than building this structure from scratch, our approach isone of keeping the positive parts while carrying out restructuring to rectify the negative parts.
Doing this is the challenge management at the Earth Group faces, and we believe thatsuccessfully navigating these challenges will allow us to put in place a lean structure. We see apath toward this goal, so this three-year period will be dedicated to execution.
For the lack of a better word, we will be prioritizing structural transformation over profits
during this three-year period, closing down and reducing unprofitable operations. This is themessage we want to convey to stakeholders.

43This concludes my presentation. Thank you for your time.

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