Pro gre s s of Th e Pr i or i t y M e a s u re s i n ”J G P 2 0 2 0 ”

Progress of Medium-Term Management Plan “JGP2020”
Developing Foundations for GrowthFiscal year ending March 31, 2021: Forecasts for orders received, net sales, and income
as well as plan for cash dividends

To establish the ground to realize our growth in the “Next 10 Years”
FY2030I n d u st r i al M a c h i n e r y Pro d u c t s B u s i n e s sM ate r i al an d E n gi n e e r i n g B u s i n e s s

JGP2020
Apr. 2019
Absorption merger of
Nikko Information
System Co.

〜JGP2017

Expansion of the existing business

Apr. 2019
Making GM
Engineering Co. intoa subsidiary

Expansion of the business scales“Aggressive management”
Sowing and nurturing of seeds for

FY2020
Forecast(B)

Orders received
Net sales
Operating income(ratio)Ordinary income
Profit/Loss
Profit/Loss per share (yen)Dividends per share (yen)

211.5
217.5
18.7
8.6%
19.9
9.3
126.66
45.0

198.0
190.0
7.0
3.7%
7.0
4.0
54.38
35.0

Change fromyear-ago period(B)-(A)(13.5)(27.5)(11.7)(4.9%)(12.9)(5.3)(72.28)(10.0)

Ratio toyear-ago period(B)÷(A)
93.6%
87.4%
37.4%
–35.2%
43.0%
42.9%
77.8%

Fostering new businessRestructuring of theSecuring profitability in the current scale

production system

Exploration of the new opportunities

Apr. 2019
Cooperation with
Tsukishima Kikai Co.

(in billions of yen)

FY2019Result(A)

New business, M&A
Oct. 2020
Absorption merger ofNichiyu Machinery Co.

expansion of our business fields

For the fiscal year ending March 31, 2021, we forecast orders received of ¥198.0 billion, a decrease of ¥13.5 billion year on year; net salesof ¥190.0 billion, a decrease of ¥27.5 billion; operating income of ¥7.0 billion, a decrease of ¥11.7 billion; and profit attributable toowners of parent of ¥4.0 billion, a decrease of ¥5.3 billion.
Our basic approach is to maintain and increase cash dividends on a stable and continuous basis.
We plan to pay an interim dividend per share of ¥17.5 for the fiscal year ending March 31, 2021, the same amount as the previous
fiscal year, for annual dividends per share of ¥35.0.

Apr. 2020
Absorption mergerof Meiki Co.

2018〜2020
Investment for greater production capacity
at Hiroshima plant

With restrictions on overseas travel and Japan’s declaration of a state of emergency due to COVID-19, we were unable to conduct business negotiations.
Since July, however, we have been steadily receiving inquiries and expect a recovery going forward.

Aug. 2019
Establishment of
Muroran Copper Alloy
Co., Ltd.

Continuous profit making
from the existing business

Apr. 2020
Establishment of Japan SteelWorks M&E, Inc.

2018〜2021 Investment for clad steel businessBusiness overview by segment for fiscal year ending March 31, 2021
(1) Industrial Machinery Products Business
The Industrial Machinery Products Business plans to achieve orders received of ¥147.0 billion, net sales of ¥147.0 billion, and operating
income of ¥11.5 billion.
Regarding film and sheet manufacturing equipment, our customers are making plans for proactive capital investment up until 2023
as regulations on CO2 emissions become ever more stringent around the world. Amid this situation, exports for China and Europe inparticular have been brisk. As for molding machines, with people spending more time at home, demand has increased since July 2020
among container, game console, and home appliance manufacturers. Accordingly, in the second half of the fiscal year we expect orders
for the molding machines to be back at the same level as the previous year. There are also signs of recovery in demand for the automobile industry.

(2) Material and Engineering Business3 Basic Policies (Priority Issues) in “JGP2020”

GrowthIndustry Machinery
Products Business

RebirthMaterial andEngineering Business

Ⅰ. Optimization of Management Resources and Strengthening of AlliancesOptimization through rearrangement of the resources→ Active investment for industry machinery product business, Rebuild of cost structure in the material andengineering business that suits the current sales scale
Expansion of the businesses through alliance and M&A→ Breaking free of adherence toward self-sufficient policies
Ⅱ. Strengthening After-Sales Services (Stock-Based Business)
Enhancement of service force mainly in industrial machinery→ Securing stable profitability, improvement of customer satisfaction
Strengthening customer relationship through service business→ Development of foundations for the next business
Ⅲ. Acceleration in Exploration and Development of New Businesses
Exploration of new businesses from the view point of mega trends
Fostering and commercialization in the 4 fields (aircrafts, hydrogen, crystals and thin films) + α

The Material and Engineering Business plans to achieve orders received of ¥48.5 billion, net sales of ¥40.0 billion, and operating incomeof ¥1.5 billion.
For clad steel and pipes, we anticipate orders for large clad pipes, but due to a delay in project progress caused by COVID-19, theorders are expected to come in the fourth quarter.
Industrial Machinery Products Business(in billions of yen)

FY2019Result(A)FY2020
Forecast(B)Change fromyear-ago period(B)-(A)

Ratio toyear-ago period(B)÷(A)

Orders received
Net sales
Operating income(ratio)

162.6
171.4
19.2
11.2%

147.0
147.0
11.5
7.8%

(15.6)(24.4)(7.7)(3.4%)

90.4%
85.8%
59.9%
–(in billions of yen)

FY2019Result(C)FY2020
Forecast(D)Change fromyear-ago period(D)-(C)

Ratio toyear-ago period(D)÷(C)

Orders received
Net sales
Operating income(ratio)

46.2
42.8
2.7
6.3%

48.5
40.01.5
3.8%

2.3
(2.8)
(1.2)
(2.6%)

105.0%
93.5%
55.6%–Material and Engineering Business*Effective from April 1, 2020, the Steel and Energy Products Business was renamed the Material and Engineering Business.

1011