SWCC SHOWA HOLDINGS CO., LTD.
Small Meeting for Institutional Investors / Q&A Session
Date: Tuesday,31 August , 2021

14:30～15:30/16:00～17:00

Location: Nihonbashi Kabutocho, Chuo-ku, Tokyo

Overall businessQ1.

How should you consider the impact of copper prices on your performance?

A

It is stable in terms of trading transactions. The impact of trading gains and losses has almost
gone. However, revaluation has some impact. Although we do not announce the specific figures,
its impact of several hundreds of million yen is included in the 1.4 billion yen increase inoperating profit in the domestic business. In the future, we will manage our business so as not
to be affected by copper prices, such as by increasing the number of products and services thatuse less copper.

Q2.

To what extent do you factor in the impact of the spread of the delta variant of the newCoronavirus?

A

This is one of the factors that left the full-year forecast unchanged. Currently, no status hasoccurred, such as a cluster occurring within our factory and ceasing operations. Due in part tothe shutdown of automobile manufacturers' factories, restriction of commuting in Vietnam, etc.,
we are cautiously looking at the impact of the shutdown. However, we do not expect this tohave a significant impact throughout the year.

Structural Reforms
Q3.

You have adopted ROIC management, and reforms have been implemented. Is there stillroom to cut the denominator? And are there any fields that you expect to grow thenumerator?

AThe denominator still has room to be cut. We think there is still some area where inventory istoo much. However, there are some difficulties with the current method. So we will permeate
ROIC management to the finest extent by using DX and ROIC trees
In terms of expanding the numerator, we are eyeing large markets, such as offshore wind andother renewable energy sources, which we have not seen so much before. In the Electrical
Equipment and Components Business, we believe that the numerator will grow by developing
its business from upstream materials to slightly downstream value-added products. In addition,
we would like to develop our DX case as a solution business.

Energy Infrastructure Business
Q4.

What is different between SICOPLUS™ and SICONEX®?

ASICONEX® is the brand name of the product. SICOPLUS™ is the name of the total service
brand that includes cable, construction, etc., with SICONEX®. In the future, we would like toincrease the size of SICOPLUS™ as a solution business by expanding the training program.

Q5.

How is the share of SICOPLUS™ calculated? For most of the substation renewal andexpansion market, SICOPLUS™ is adopted as default?

AThe share is calculated by ourselves based on the orders for our SICONEX® (components),cable, and construction, relative to the total market size of substation renewal and expansion
market. And as you mention, SICOPLUS™ is adopted as default for most cases.

Q6.

What kind of image do you have regardfing "strategic alliances" and "M&A" presented
as future strategies for the electric power business?

AWe can expand of production of SICONEX® by increasing the manufacturing facilities, but at
the same time, it is difficult to secure the construction capacity and the installation personnel.
SICOPLUS™ is to create educational programs and firmly establish cooperation systems andsales expansion systems with third parties. In the future, we are considering that we will
establish an education program in cooperation with venture companies, etc.

Communication and Industrial Device Businesses
Q7. What are your thoughts on trends in the optical fiber market?
ANorth America and some of the Southeast Asian countries are moving toward 5G. But as thelargest market, China, remains stagnant, we think the market as a whole will not growdrastically soon. The problem of shortage of semiconductors and chips between the UnitedStates and China has a large impact. We think there will be no rise in demand until next year.

Electrical Equipment and Components BusinessQ8.

We heard that the production of Oxygen-free copper for automobiles has been close tofull operation since the 2H of the previous fiscal year. Is this the main reason for 1Q's
profit expansion? Or due to changes in the product mix or something?

A

Technological development has been advancing, and we have come to be able to produce
Oxygen-free copper at a high level with stability. The impact of this is reflected in the last fiscal

year’s 2H and 1Q of the current fiscal year. But there still is room for technological development
and profit growth. And general-purpose products also performed well. Mainly because manycustomers procured industrial-use winding wires from us this year due to the problems ofoverseas supply-chain. (There were almost no industrial-use winding wires sales last fiscalyear.)

Q9.

The EV market in China is said to be centered on the low-price range. I think that Oxygenfree copper is over-spec for a low-price EV market. What do you think of this point?

AThis is an issue for the new medium-term management plan. There’s an opinion that low-pricecoppers meet the demand for the mid and low-end EV market. So we are gathering andconsidering how we can strike a balance with Oxygen-free coppers at this point. We would liketo explain this in the new medium-term management plan.

Q10. What are the competitors in the automotive products and your market positions?
AFor MiDIP®, it can be said that there are no competitors in the sense that we are the only
company with this manufacturing facility in Japan. MiDIP® is for high-quality motors only, so
not used in all cars, but we consider it competitive.
As for heater wires, we produce them with copper-silver alloys made of copper and silver. They
are used for seat heaters, handle heaters, and battery heaters in luxury cars. There are twodomestic competitors, but they do not use copper-silver alloys. Our products are hard to break
and have a strong durability to bending. Not only in Japan but also there are overseas demands
for seat heaters.

Q11. Are automotive winding wires included in general-purpose products?
AAs winding wires for automobiles are included in "Other high-performance products", they are
not general-purpose products.

Q12.

Compared to 2 years ago, there are major changes in the Electrical Equipment andComponents business. Is this affected by copper prices?

AThe impact of copper prices is somewhat affected. But we believe this is mainly due to anincrease in the number of xEV vehicles using high-performance products. And an increase inshipments due to an increase in the production of high-grade Oxygen-free copper due to ourtechnological innovations.

Q13.

Do 1Q net sales of the Electrical Equipment and Components business include theimpact of copper prices? Your 1Q operating profit is already more than half of the fullyear profit forecast. Is there any upward revision to the full-year earnings plan? If not,what risks are you factoring in?

A

The impact of copper prices was partly offset by favorable sales of general-purpose products aswell as high-performance products due to 1Q supply-demand balances. As for the full-year
earnings plan, we are carefully looking at the impact of the movement of automobile
manufacturers’ factories shut down and other factors.

New Businesses
Q14. What is the progress of verification tests with BASF on superconductivity?
AThe construction period has been longer due to the impact of the Corona disaster. The
demonstration test is scheduled to be completed in September 2021. Currently, progress is being
made as planned. The company hopes to commercialize this product under the new mediumterm management plan.