Innovating new ideas today. Becoming the norms of tomorrow.

Supplementary Material for the First Quarter of the Fiscal Year Ending March 2024

August 3, 2023

TSE PRIME : 5805

Contents

１．FY2023 Q1 Overview of Financial Results
２．FY2023 Full Year Forecasts
３．Appendix

2

１．FY2023 Q1 Overview of Financial Results3

FY 2023 Q1 Financial Results Overview

Management
EnvironmentThe economy has normalized due to the relaxation of movement restrictions due to COVID-19.



Raw material and energy prices soared due to the protracted situation in Russia and Ukraine and the weakening yen.

In the automotive-related market, the impact of automobile production cutbacks due to semiconductor shortages is recovering.

In the electric wire industry, overall demand for electric wires increased slightly.



The average domestic quotation price for copper declined slightly from the same quarter of the previous year.

The business plan for the current fiscal year is generally weighted toward the second half of the year. Q1 results showed sales were down YoY.
[Status of Major Business Fields]

Net sales

Energy Infrastructure: Strong construction-related business compensates for the second-half bias in electric power construction.
Automobile: High-performance products for xEVs continue to be in an adjustment phase, but have bottomed out.
Industrial Devices: Demand is sluggish due to partial drop in pandemic special demand.

OperatingprofitElectric Power Infrastructure progressed as initially expected, with a bias toward the second half of the year. It was supported byconstruction-related and communication cables.
Profit decreased from the same period of the previous year.

4Key Points of the Financial Results for Q1Q1 YoY Change

Q1 Progress rate

Figures for the current fiscal year are assumed to beweighted toward the H2 (around 30% in the H1 andaround 70% in the H2).
Net sales(Unit: 100 million yen)

Down
3.2%

50

Operating profit

484

FY2023 Q1

Down
25.6%

20
10

FY2022 Q1(Unit: 100
million yen)

Full-year
Plan

FY19-22
Avg.
progressrate

Net sales

2,150

23.2%

22.5%

Operatingprofit

107

18.4%

15.0%

40
30

500

The progress rate of sales was in line with the average, but
operating profit was lower than usual due to theconcentration of power construction projects in the H2.

022

FY2022 Q1

16Q1
Progress
rate

FY2023 Q1

5FY2023 Q1 Consolidated Statements of Income(Unit: 100 million
yen)

FY2022
Q1 Actual

FY2023
Q1 Actual

FY2023Full-year plan

Progress
rate
%

YoY
%

Net sales

500

484

2,150

▲3.2

22.5%

Operatingprofit

22

16

107

▲25.6

15.0%

Operatingprofit margin
(%)

4.3

3.3

5.0

ー

ー

Ordinary profit

23

16

106

▲30.0

15.1%

Net income
attributable toowners of parent

16

12

70

▲28.0

16.9%
6

FY2023 Q1 Change Factors (YoY)
Change factors for net sales
510億円
500億円

FY2022
Q1-¥0.1 billion
Effect of rise incopper prices

490億円
480億円

¥50.0

470億円

billion+¥0.9 billion
Energy andInfrastructure
Business

Energy and Infrastructure Business: -0.06 billion yen-¥1.6 billion-¥0.8 billion
Electronic
Equipment
andComponents
Business

Electrical Equipment and Components Business: -0.08 billion yen

FY2023Q1+¥0.02 billion
Communication
and Industrial
devices Business

Others¥48.4 billion

Foreign exchange
impact: 0.1 billion yen

Communication and Industrial Devices Business: 0.02 billion yen

460億円[Change factors]

450億円

Change factors for operating profit
FY2022
Q1-¥0.7 billion-¥0.1 billion¥2.2 billion

Concentration ofelectric power
constructions in H2
Sluggish demand for
xEV

Absence of the
COVID-19
specialdemand-¥0.5 billion＋¥0.5 billion+¥0.1 billion

FY2023
Q1

Increase in selling
prices and cost
reduction

2. Operating profit
Profitability improved throughstructural reforms and sales atreasonable prices in response torising raw material and energy
costs, but profits declined aselectric power constructions areconcentrated in the H2.
[Future Initiatives]

Structural reforms
Increase in raw
material andenergy costs

1. Net sales
In line with initial forecasts, overallsales decreased due to sluggish
demand for xEV and the absenceof the COVID-19 special demand,
while projects are generally
concentrated in the H2.

・Integration of
production and sales
operations to SFCC
・Restructuring of
telecommunications¥1.6 billion

Secure personnel and inventory
to recover demand in the H2.

7

FY2023 Q1 Segment Results - Energy & Infrastructure Business
Construction
Seismic isolation/others

1,135(Unit: 100 million yen)

300

1,100
1,000

266

258

900
20
800

17

12700

200
70%

179

72%

193

100

0

Operatingprofit ratio

77
68%

775

600
10
500

5%

24%

63

13

4%

10

FY2022 Q1

6.5%

FY2023 Q1

4.5%

200 27%
100
(10)
0

4%

310
50

Full Year Plan

6.8%

The second half bias in electric power construction will be offset bystrong constructionrelated business. Implemented various profit

70

improvement measures. Sales increased (+3.2%) and income

60

decreased (-29.4%) compared with the same period of the previous

50

year.

30

300
0
65

80

40

400

25%

Q1 YoY changeElectric power Infrastructure
Operating profit

20
10
0

Impact of Changes in Business Environment
Impact of Copper Price
Fluctuation

Net sales decreased by 60 million yen.

Soaring raw material, energy,
and logistics costs

Although prices continue to rise, the Company has beenable to secure profitability through price pass-through andcost reductions. Logistics is preparing to address the 2024
problem.

Changes in demand

Although demand for both domestic construction-related
and electric power infrastructure is strong, electric power
construction work is heavily weighted toward the second
half of the fiscal year under review.

8

FY2023 Q1 Segment Results - Electrical Equipment and Components Business
High-Performance Product Oxygen-free Copper
Other High-Performance Products
General-Purpose Products
Operating Profit
800

700(Unit: 100 million yen)

200

138

6
49%

100
7%

44%

0

76
11
68

FY2022 Q1

500

66

10%

14

200

58

100

42%

42%

FY2023 Q1

300

0

49%

electric machinery remain strong. Sales decreased (-10.7%) and income

280

60

9%

48%

phase as demand recovers, but general-purpose magnet wires for heavy

15

400

5

High-performance products for xEVs continue to be in an adjustment

660

10
600

155

Q1 YoY change

20

decreased (-26.7%) compared with the same period of the previous year.
10320Full Year Plan0

Impact of Changes in Business Environment
Impact of Copper Price
Fluctuation

Net sales decreased by 80 million yen.

Soaring raw material, energy,
and logistics costs

Although prices continue to rise, the Company has beenable to secure profitability through price pass-through andcost reductions. Logistics is preparing to address the 2024
problem.
Demand for high-performance products for xEVs is

Operatingprofit ratio

4.0%

3.3%

2.3%

Changes in demand

expected to recover in Q2 and beyond, despite an
adjustment phase in Q1.

9

FY2023 Q1 Segment Results - Communication and Industrial Devices BusinessCommunication cables
Precision Devices

Wire harnesses
Operating profit

350(Unit: 100 million yen)

100

70

200
54%

26

21%

0

Operatingprofit ratio

2

17

FY2022 Q1

2.2%

305

38

20

18%

13

53%

160

FY2023 Q1

4.2%

16
14
12
8

34%

105

50
00

18

10

150

3 100
28%

19

250

35

33%

20

10
300

78

45%

Q1 YoY change

13%

40

Full Year Plan

6.2%

6
4
2
0

Industrial Devices was partially affected by the drop in pandemic special demand,but this was offset by increased sales of communication cables, thereorganization of domestic production bases and the effect of reasonable pricesales. Sales decreased (-10.2%) and income increased (+67.2%) compared withthe same period of the previous year.

Impact of Changes in Business Environment
Impact of Copper Price
Fluctuation

Net sales increased by 20 billion yen.

Soaring raw material, energy,
and logistics costs

Although prices continue to rise, the Company has been able tosecure profitability through price pass-through and cost
reductions. Logistics is preparing to address the 2024 problem.
Demand for communication cables was firm for construction-

Changes in demand

related applications.
Consumer electronics and personal printers lost some of thepandemic special demand.

10

FY2023 Q1 Consolidated Results B/S（Comparison with the end of the previous year)(Unit: 100 million yen)

FY2022E

FY2023 Q1[Inventories]
Inventories increased to secure stock in anticipation ofdemand growth in Q2 and beyond.

Change

1,567

1,547

(20)

Trade receivables

527

484

(42)

Inventories

282

302

21

Non-current assets

646

648

2

Total assets

883

861

(21)

Trade payables

249

261

12

Interest-bearing debt

412

386

(25)

Total net assets

684

685

2

Equity

675

677

2

Equity ratio (%)

43.1

43.8

0.7

61

57

(4)

Total liabilities

DE ratio (%)[Non-current assets]
Investment securities increased due to soaring stock
prices, although the company proceeded with sell offs
in accordance with its policy holding policy.
[Interest-bearing debt]
Interest-bearing debt decreased due to a decrease inworking capital.
[Equity ratio]
Equity ratio increased 0.7 points from the end of theprevious period due to a decrease in total assets.
[DE ratio]
Interest-bearing debt decreased and shareholder
equity increased, resulting in a 4-point decrease fromthe end of the previous fiscal year.
<Recognition of current issues and future measures>
Although BS showed improvement due to various
measures, inventories increased due to the securing of
inventory holdings in anticipation of soaring raw material
prices and demand growth in Q2 and beyond. Continue topromote improvements by ensuring inventories atappropriate levels and shortening debt collection periods.

11

2．FY2023 Full Year Forecasts

12

FY2023 Recognition of Business Environment
Progress in the first half is expected to be slower than usual. In the second half of the year, we expect the highest full-year profits due to strong
demand in the electric power and communications sectors, recovery of products for xEVs, and full-fledged launch of new businesses.

Forecast

Operating profit

H1

H2

3.5 billion yen

7.2 billion yen(Q1 results: 1.6 billion yen)
Dividend

Construction

35 yenAverage for time of year

40 yenAverage for time of year

Recognition ofBusiness Environment

Concentration of electric power projects with strong demand,

Electric power
Automobile
Industrial
Devices
Communication
New Business(ICT)

H2 bias in power construction
Demand for high-performance products for xEVs is expected tosuch as renewable energy system development
Sales expansion through increased production of SICONEX®

recover in Q2 and beyond, despite an adjustment phase in Q1.

Recovery in demand for high-performance products for xEVs

Drop in pandemic special demand in the industrial device
business

Recovery in demand for Industrial Devices Business

Demand for high-grade LAN expands; FLANTEC® shipments forautomotive applications begin.

Expansion of overseas sales of e-Ribbon® and sales of
FLANTEC® for automotive applications

Average for time of year

ICT in full swing

13

FY2023 Full-year Forecasts
Plan to capture demand in the H2 and increase sales and profits through various measures.
Dividends are planned to be increased by paying an interim dividend.

Operating profit

Net sales(Unit: 100 million yen)
2300

2100

(Unit: 100 million yen)
2.8%
increase

2,091

110

2,150

105

105

10.6 billion yen (YoY: 2.0% increase)

2.2%
increase

107
Net income attributableto owners of parent

100
1900

7.0 billion yen (YoY: 25.6% decrease)

95
90

Dividend/
Payout ratio

1700
85
1500

FY2022 Actual FY2023 Plan

80

Ordinary profit

75 yen/32% (YoY: 15 yen increase)
FY2022 Actual FY2023 Plan

Interim: 35 yen, Year-end: 40 yen
Total: 75 yen

14

FY2023 Factors for change
Sales Increase/Decrease Factors + ¥2.9 billion+ ¥5.5 billion¥209.1 billion- ¥0.3 billion
Energy andInfrastructure
Business

FY 2022- ¥2.8 billion+ ¥0.6 billion

ElectricalCommunication andEquipment and Industrial Devices
Components
Business
Business

FY2023

Other
Businesses

1. Net sales¥215.0 billion

Impact of Copper
Price Fluctuation
Energy and Infrastructure Business Section 0.5 billion yen
Electrical Equipment and Components Business Section 5 billion yen[Change factors]

Sales are expected to increase mainly
by sliding cost increases due to higher
copper prices into sales prices in atimely manner.

Operating profit increase/decrease factors
FY 2022- ¥1.1 billion+ ¥1.1 billion+ ¥0.2 billion
Structural reform+ ¥0.2 billion

FY2023

Rising energy and logistics costs were
New businesses(ICT)

compensated for by reviewing sales
prices and reducing costs. In addition- ¥0.2 billion¥10.5 billion

Rising energy andlogistics costs, etc.

¥10.7 billion
Drop inpandemic
specialdemandSelling pricepass-throughand cost
reduction

2. Operating profit

to the effect of structural reforms of
200 million, profit is expected toincrease due to the full-scale launchof new business (ICT).

15

FY2023 Business Plan by Segment
Electronic Equipment andComponents Business

Energy and Infrastructure Business
Construction

Electric power Infrastructure

Seismic isolation/others

Operating profit（

High-Performance Product
Oxygen-free Copper
General-Purpose Products）Operating profit margin

（

1,200
1,100
1,000
900
800
700
600
500
400
300
200
100
0

（Unit: 100 million yen, %）

1,133

1,135

7770
(6.8)

77
(6.8)
782

80

775

60
50
40

Wire harnesses

Precision Devices

Operating profit

254

300

52

30

100

57

50

FY2022

FY2023 E

20

0

25

581

400

200

（

）Operating profit margin

660

500

310

Copper price impact: +0.5 billion yen in sales

Communication cables

Operating Profit

700

294

Positive factor:●Improved profitability by integrating construction-related manufacturing
and sales businesses●Sales contribution from investment in increased production of
SICONEX®.
Negative factor:●Decrease in construction-related special demand

Other High-Performance Products（Unit: 100 million yen, %）600

Communication andIndustrial Devices Business

17
(2.9)

276

FY2022

20

280
60

1515
(2.3)
10

320

FY2023 E）Operating profit margin（Unit: 100 million yen, %）

400
300

333

18
158 (5.3)

200

5

100

0

0

103
71
FY2022

305

19
(6.2)

160

105
40
FY2023 E

Copper price impact: +5.0 billion yen in sales

Copper price impact: ーPositive factor:●Recovery in high-performance products for xEV in 2H●Strong demand for heavy electrical equipment

Positive factor:●Maximize the effects of integration of communication cableproduction bases●Rifting of the lockdown in China
Negative factor:●Absence of COVID-19 special demand for industrial devices

Negative factor:●Adjustment phase of high-performance products for xEVs in Q1

20

10

16

FY2023 Consolidated Results CF Forecast and Capital Investment Plan
<Consolidated cash flow>
150(Unit: 100 million yen)

OperatingCF

130

Investment
CF<Capital Investment Plan>

Free CF Financial Balance of cash
and deposits
CF

Reduction of environmental
impact, etc.
R&D

Figures in < > indicates yearon-year increase/decrease

100

50

42

<(45)>

0

<+88>
△ 50

△ 100

50
6

(1)

27%

FY2023

6.7 billion yen

<0>
51%

(50)

(80)
FY202214%

2%

Production Capacity Expansion

Capital Investment Plan<(49)>

<+44>

(35)

40 40

Rationalization and ICT
enhancement

7%

Reorganization and strengthening ofproduction bases, facility renewal

Breakdown by Segment
FY2023E

Operating CF in FY2023 will increase due to working capital reduction
Investment CF increased due to increased capital investments

Energy and Infrastructure Business Section

2.5 billion yen

Electrical Equipment and Components Business Section

1.8 billion yen

Communication and Industrial Devices Business Section

1 billion yen

Other

1.4 billion yen

17

3. Appendix

18

Energy and Infrastructure Business - Strategic Products and Business Environment
SICONEX® power connection components are indispensable in connecting power plants to factories, buildings, and homes via substations.
We support social infrastructure by taking advantage of our product superiority in terms of light weight, compactness, reduced construction time, andsimple joint design.

Simplified joint
designLightweightand compact

1150

1297

1600

1725

1892

Pre-assembled andshipped from the factoryPlug-in

白テ ープ

Reducedconstruction time
Mainframe installation& Cable processing

Mainframe installation& Cable processing

asse
mbly

assembly

Other

Strategy[Products]: Investment in increased production and expansion of market
share by leveraging product superiority[HR]: Expanding alliances with educational and cooperative companies through theConstruction Human Resources Development Center

Porcelain

Other

Tailwind● Current market: Demand for renewal of aging power grids● Future market: Renewable-energy electricity grid development

Construction
shortened by 30%

19Electrical Equipment and Components Business - Strategic Products and Business Environment
Against the backdrop of a decarbonized society, we are expanding our xEV-related business performance, centered on the high-performance oxygen-freecopper MiDIP®, which is manufactured using the only DIP forming method in Japan and has low oxygen content, high electrical conductivity, and excellent
processability. High-performance products are expanding their horizons not only domestically but also overseas to enhance product competitiveness.
Shipment Volume Trends by High-Performance Product Category

Applications and features of high-performance
products in xEVs
Copper alloy wire (heater
wire)

300%
250%
200%

Drive motors
Motors, inverters,
transformers, etc.

Oxygen-free Tough pitch
coppercopperHandleheaters

Seat heater

150%

2x
1.5x

1000%
800%
600%
400%

1.5x

200%
0%

50%

Electricalconductivity

0%(Bending,
thinness)

10x

100%

Oxygencontent

Processability

Rapid recovery upward phase
State of emergency declaration

High-performance magnet
wire (Straight angle magnet
wire)

Outbreak and spread of COVID-19

Oxygen-free copper(MiDIP®)(Estimated with pre-pandemic as 100)

-200%

FY2019FY2020

FY2021

Automotive magnet wire (left axis)
Heater wire (left axis)

FY2022 FY2023E FY2024E FY2025E FY2026E-400%

MiDIP® (left axis)
High-performance magnet wires (right axis)

20Communication and Industrial Devices Business - Strategic Products and Business Environment
We have expanded our business from consumer electronics to industrial equipment and wire harnesses for xEV vehicles, which are expected to expand in the
future, and have three bases in China and Vietnam, taking advantage of production methods that achieve high efficiency and labor savings throughautomation.

China

Jiaxing Showa Interconnect
Products Co., Ltd.
New plant starts operation in January 2022

China

Jiaxing

Reducedelectricity costs
and CO2emissions byintroducing
solar power
generation

VietnamBusiness environment as a tailwind

Total floor space

Hung Yen

Dongguan Showa Interconnect Products Co., Ltd.

Vietnam

SWCC SHOWA VIETNAM
INTERCONNECT
PRODUCTS CO., LTD.

(1) Diversification of production bases(2) Promote local procurement and local production for
local consumption(Jiaxing and Dongguan: 74% local procurement rate in FY2022)

Approx. 35,000 m2

Dongguan

Structural reforms to date

Plant expansion and relocation in April 2023
Reducedelectricity costs
and CO2emissions byintroducing
solar power
generation
Total floor space
Approx. 5,700 m2(1) Growing demand for high-performance consumer
electronics in response to increasingly sophisticated social
environments and living standards(2) Expansion of China's economic zone and expansion of
local manufacturers' business areas(3) Optimization of local production systems, commercial
distribution, and customer development in response to theabove changes in the environment21

https://www.swcc.co.jp

The forward-looking statements in this presentation are based on information available at the time of publication and involve potential risks and uncertainties.
Therefore, please be aware that a variety of factors could cause the actual results to differ materially from those projected in the statements.
Such factors that may affect actual results include economic conditions, demand trends, and fluctuations in raw material prices and exchange rates.
Factors that may affect business performance include, but are not limited to, the following.