□ In this briefing session material, AP denotes asphalt plants in our business, and BP,concrete plants.

1

2

I am going to explain the business results for the first quarter.
In the first quarter, profits declined even as sales increased.
□ The biggest factor behind the sales increase is the acquisition of Ube Kohki thisMarch and making it a consolidated subsidiary from this first quarter. With the additionof Ube Kohki’s sales of around 450 million yen, our sales increased compared with thesame period a year earlier.
□ We were expecting the decline in profits from the beginning of the term, and there
are three main factors.
The first one is the rise in raw material costs. The cost of raw materials led by steel
continues to soar.
The second point is the significant increase compared with the same period a year
earlier in our up‐front investment in personnel expenses, R&D expenses, anddepreciation and amortization.
The third point is that we have two subsidiaries in Thailand: a sales subsidiary and amanufacturing subsidiary. The first quarter for the previous year did not mostly include
the profit or loss of the manufacturing subsidiary, but it has started full‐scale
operations from the current fiscal year, and it is still losing money. As for the Thailandbusiness, it posted a loss of about 30 million yen in the first quarter of the previous
year, compared to a loss of about 70 million yen in this quarter. So, year on year it
worsened by about 40 million yen.
AP and BP business environment.
□ Regarding AP, the price of asphalt is surging following the rise in crude oil prices,and road paving companies, our customers, are in a tight situation in terms of
profitability because of the rise in raw material costs. This cost increase is expected to
be gradually transferred to the mixture product price, but the soaring raw materialprices are a step ahead, and the situation remains tough in the current scenario. Going3

forward, there is a possibility of AP orders lagging a bit compared with the initial forecast.
□ As far as BP is concerned, the customer appetite for investment remains quite robust. Neworders received for the quarter declined year on year, primarily because of the exceptionally highnumber of orders in the first quarter of the previous fiscal year which included a large project. Itis, however, expected to be at a level equivalent to the previous year for the full year.
□ While the AP business is facing a slightly tough environment, BP continues to enjoy favorable
conditions.
Overseas business environment.
□ The Chinese business was affected by the lockdown at the beginning of the year. We haveposted an extraordinary losses in excess of 20 million yen for the quarter, and these figures show
the impact of the lockdown in Shanghai in the first quarter. At the same time, the budget forroads in China continues to be large and we expect strong demand for our asphalt plants. As ofnow, the demand situation is favorable in China.
□ As for Thailand, we have just started and we believe it is important to get the business on trackrather than talking about the business environment, etc. Overall, the impact of COVID‐19 still
remains in the domestic economy in Thailand, and the current business environment is not that
good.

3

4

Performance highlights for the first quarter.
□ Sales were up by 687 million yen year on year. Though it is slightly less than 50% of
the 20,000 million yen in sales forecast for the first quarter, the rate of progress is not
so bad.
□ Operating income came to 183 million yen. In terms of progress made, it is 18%, but
the difficulties in achieving operating income was anticipated to a certain extent fromthe beginning. I will explain in detail later, but even though there is a possibility of theincome falling below the forecast in the first quarter, we expect to attain the full‐year
forecast figures announced at the beginning of the fiscal year.
□ The operating margin was 1.9%. The decline in net income, down 238 million year onyear, is much larger than the decline in operating income. The reason for the large
decline in net income year on year is because of the lack of any special factors such as
the recording of 60 million yen in profit from sales of strategic shareholdings during thesame period a previous year.
□ New orders received were up by 464 million yen year on year to 10,217 million yen.
The numbers are good in some segments and bad in others. While the orders received
are down for BP year on year, it is due to the fact that the numbers were high in thesame period a year earlier, and we are not necessarily worried. AP posted an increase of
500 million yen year on year. There was also the contribution from Ube Kohki.
□ The annual forecast for new orders received is 46,000 million yen. If you simply
divide it by four, it will be around 11,500 million, and it would appear that it is notfavorable in terms of progress rate. However, there are discrepancies in the orders
received between quarters and we do not see the first quarter number as somethingthat is especially low.
□ Order backlog increased by about 2,000 million yen compared with the same perioda year earlier to 17,200 million yen.

5Performance per segment for 1Q.
□ AP recorded sales of 4,900 million yen with operating income of 139 million yen.
Currently, the AP segment is the one that is being affected the most by the soaring raw
material prices. There is also the impact to the profit of the Thailand business, which
worsened by about 40 million yen compared with the previous year.
□ Sales in BP were up by about 400 million yen compared to the previous year.
Operating margin was down 1 pt to 8.9% from a year earlier. It is the figure for thethree‐month period and we do not think profit margin is worsening.
□ Regarding the environment‐ and conveyor‐related businesses, we recorded a certain
level of sales of environment products in the first quarter, up by 200 million yen.
Operating income also rose by 80 million yen.
□ Sales of other businesses were up by 141 million yen, but if that of Ube Kohki isexcluded sales would have been much lower. Sales in both mobile plant business andwaterproof board business, which we had been positioning as growth businesses for thepast few years, were lower than the sales during the same period a year earlier. Sales
have also fallen year on year for both temporary construction materials and scaffoldings.
Operating income came to 31 million yen.
The other businesses have been maintaining double‐digit operating margin throughout
the year for the past few years. Though, at 2.1%, the margin has come down in the threemonths under review, it is only temporary and we expect it to recover from the secondquarter onwards.

6This slide shows the quarterly sales, operating income, operating margin, and orderbacklog in bar graph and line graph.
□ While the unevenness in quarterly sales and income has come down compared withthe past, in our case, sales are concentrated in the second and fourth quarters, andlower in the first and third quarters. For that reason, income also tends to be less. This
trend has not changed.
□ In the current fiscal year, we are anticipating sales of 10,000 million yen andoperating income of about 800 million yen for the second quarter. You may have doubts
whether these figures are really achievable. In FY 2021, sales for the second quarter
were 10,100 million yen while operating income was about 600 million yen. In FY 2020
also sales came to 10,000 million yen with operating income of about 600 million yen.
When compared to the previous year and the year before that, operating income ishigher by about 200 million yen, but it is not that income is concentrated very much inthe second quarter.
□ Order backlog till the second quarter is expected to be 19,400 million yen, or about
5,000 million yen higher than the 14,000 million yen of the previous fiscal year. This
includes about 1,500 million yen in order backlog of Ube Kohki. Nevertheless, even if
you exclude that, the order backlog is expected to land at a level that is more than 3,000
million yen higher in the second quarter.

7□ Now, we will look at the AP segment.
□ Orders received for the first quarter was about 5,094 million yen. In terms of orders
received within Japan, orders that were scheduled to be received at the end of theprevious fiscal year were delayed and got added to the current fiscal year, leading to theincrease. As for China, while orders received slightly declined due to the impact of thelockdown, they have rather increased in the second quarter compared with last year.
We expect to post good figures in China in the current fiscal year.
□ Sales on the whole are down 1.5% compared with the same period a year earlier,with domestic sales down 15%, while overseas sales were up by 28%.
Sales in China were up 14.5% year on year, partially also due to the impact of foreignexchange. There were almost no exports in the same period a year earlier. In thecurrent fiscal year, however, exports to Taiwan are strong, boosting overseas sales.
□ Operating income was down 30% for AP as a whole. The factors are the same asexplained before, so I am not repeating. It is as described here.

8This is about AP‐related business in Japan and abroad.
□ Sales for plant products and maintenance services in Japan decreased from a year
earlier with plant product sales falling significantly. Sales of maintenance services havealso decreased slightly by about 6%.
□ Overseas sales have increased significantly also due to the almost zero exports in theprevious year.
□ With respect to orders received and order backlog overseas, they have seen major
increases in China.
□ Order backlog in Thailand for the first quarter had stayed unchanged at 260 million
from the end of the previous fiscal year as there were almost zero sales in Thailand.
Export orders received came to 140 million yen, while order backlog was 500 million yen.

9This is the BP segment.
□ Orders received for the term declined to about 2,800 million yen from the 3,100
million yen during the same period a year earlier. This, however, is about 700 million
yen higher than the figure for FY 2020. New orders received in the first quarter of theprevious year were at a high level exceeding 3,000 million yen. For the full year of thecurrent fiscal year, we expect orders received to be about 12,000 million yen, which ismore or less the same level as the previous fiscal year.
□ Sales have increased compared to the previous year as order backlog piled up
significantly at the beginning of the fiscal year.
□ While operating income rose on the back of increased sales, operating margin
declined slightly.

10□The environment‐ and conveyor‐related business.
□ Orders received rose by about 100 million yen year on year due to someenvironment‐related orders.
□ Sales have increased markedly on the back of sales of environment‐related products
such as sludge dryers, beverage bottle separator crushers, etc. Conveyor‐related sales
have also increased significantly as the impact of COVID‐19 has lessened considerably inthe current fiscal year.
□ Operating income has risen markedly compared to the previous year on the back ofincreased sales.

11This is the other business.
□ Orders received on the whole has increased to 1,700 million yen from the previous
year’s 1,500 million yen. However, if Ube Kohki’s contribution of 410 million yen isexcluded, the figure is lower than the previous year’s. Especially in the case of mobile
plants, the amount of orders received has decreased considerably to 100 million yen in
the current fiscal year from the about 300 million yen during the same period a year
earlier. Nonetheless, though the first quarter result for the mobile plant business justhappened to be like this, we expect it to be higher for the full‐year compared to theprevious year.
□ Sales were up by 10% year on year.
□ Operating income declined by 80% on year. The absolute value of operating income
fell significantly compared to the previous year due to the fact that sales of waterproof
boards and temporary construction materials, which have high operating margins,declined significantly from the previous year.

12This is the year‐on‐year comparison of ordinary income for the first quarter and theanalysis of factors contributing to changes in ordinary income. The blue bars denote thefactors that had a positive impact while those in red denote factors with a negativeimpact.
□ Income contribution from increased sales was 185 million yen. Cost‐of‐sales ratio
went up by 1.3%. R&D expenses rose by 20 million yen. Depreciation and amortization
also increased by 28 million yen. Personnel costs rose by 119 million yen, while otherSG&A expenses also increased by 93 million yen.

13

This is the forecast of the analysis of the factors contributing to the changes in the full‐year ordinary income. It compares the forecast for the current fiscal year and the results
for the previous fiscal year.
□ Sales is expected to increase year on year by 3,000 million yen, and its contribution
to income is expected to be 880 million yen.
□ Cost‐of‐sales ratio for the first quarter worsened compared to the same period of theprevious fiscal year. We have been raising prices based on the rise in raw material costs
from April 2021. However, in the case of APs in particular, there is a time lag of morethan a year after we receive the order till we actually ship the product and record the14sales. The level of impact of the rise in raw material prices is declining steadily, but as far as thecurrent first quarter is concerned, there were lot of sales related to orders received in the fiscal
year before last, which also contributed to the worsening of cost‐of‐sales ratio on the whole in
the first quarter. We expect it to maintain roughly the same level for the full year with some slightimprovement.
□ We are expecting personnel costs to go up significantly by about 360 million yen. This isbecause of the fact that we raised the wages across the board by 30,000 yen and also theincrease in number of employees. As stated in the Medium‐Term Management Plan, we areplanning to add 145 employees in three years so as to place people in growth fields. We haveadded 41 employees in the first quarter. We are anticipating an increase in personnel costs forthe full year because of the increase in staff.
□ R&D expenses are expected to rise by 300 million yen, while depreciation and amortization isexpected to increase by 40 million yen. We also anticipate absence of foreign exchange gains
recorded in the previous term. You may point out that our view of the impact of the cost‐of‐sales
ratio is a bit optimistic, but other than that we feel there will not be any major changes.

14This shows the balance sheet. It is the comparison with the balance sheet of theprevious fiscal year.
□ Total assets have increased by about 5%, or about 2,500 million yen. Property, plantand equipment increased considerably, as we are proactively making investments.
Buildings and structures together increased 1,400 million yen. The largest item is theinvestment in the Thai plant. Intangible assets are also up by 357 million yen, and thisis software‐related.
□ As for current assets, while cash and cash equivalents and accounts receivable‐
trade have decreased, work in progress rose by about 2,000 million. Current assets as awhole increased by 400 million yen.
□ In liabilities, current liabilities were up by 400 million yen, and non‐current liabilities
increased by 1,500 million yen.
□ Net assets increased by 600 million yen year on year, with the most recent net
assets at 31,700 million.

15

16

17

18

19

20

21

22

23

24

25

26

27

28

29