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Financial Results for the Fiscal Year Ended March 31,
Medium-term Management Plan “Change & Growth SWCC 2026” Rolling Plan 2024
Presentation Materials
May 21, 2024

TSE PRIME: 5805

目次

１． Summary of FY2023 Financial Results and FY2024 Full-Year Earnings Forecast

２． Medium-term Management Plan “Change & Growth SWCC 2026” Rolling Plan 2024

3． Appendix

2

１． Summary of FY2023 Financial Results and FY2024 Full-Year Earnings Forecast3Overview of Financial Results for FY2023
Results: Sales and profits increased YoY, driven by the Energy and Infrastructure Business, despite theimpact of external factors.
• Energy and Infrastructure
Business

In construction-related products, we revised sales prices and improved profitability to capture stable demand.
In products for electric power infrastructure, demand related to special high voltage was firm, and the number of electric power
projects increased from the 2H.
Sales and profits increased YoY.

・ Electronic Equipment andComponents Business

Sales of high-performance products for EV recovered, but demand for industrial machinery in general-purpose products was
sluggish.
Sales and profits decreased YoY.

• Communication and Industrial
Devices BusinessIn telecommunications products, sales of construction-related products were firm, while sales of products for automotive
applications started full-scale operations. In industrial devices, demand for office products recovered in part, but demand forwire harnesses for domestic home appliances was sluggish.
Sales and profits decreased YoY.

Progress Rate to the Plan
(Net Sales/Operating Income/Ordinary Income/Net Income）(100 million yen)

2,000

Net Sales

2,120

2,139

1,500
1,000
500
0

Plan

Results

120
100
80
60
40
20
0

* Both ordinary income and net income reached record highs

Operating
Income120

Plan(Reflects revised earnings forecast announced on February 2, 2024)

RecordHigh

128

Results

120
100
80
60
40
20
0

118

Plan

Ordinary
IncomeRecordNet Income

High

122

Results

120
100
80
60
40
20
0

83

88

Plan

Results

4

FY2023 Consolidated Statements of Income
Sales and profits increased YoY. Profits exceeded the revised plan, with both operating income and ordinary income reaching record
highs. Plan to increase year-end dividends.
（Unit: 100 million yen）

FY2022
ActualFY2023
ActualYoY (％)Net Sales

2,091

2,139

2.3

Operating Income

105

Record High 128

22.4

Operating Income Margin（％）

5.0

6.0

+1.0ptOrdinary Income

104

Record High 122

17.5

Net income attributableto owners of parent

94

88

▲6.1

Dividend per share（Yen)

60

90

30

ROE (%)

15.0

12.3

▲2.7ptROIC (%)

7.1

8.3+1.2pt¥5 increase from
3Q results announcement

5FY2023 Results by Segment
Despite the impact of sluggish demand for industrial machinery and the economic downturn in China/Vietnam,
company-wide profits reached record highs due to the strong Energy and Infrastructure Business with its firmsales from construction and electric power-related projects.
FY2022
Actual（Unit: 100 million yen）

Energy and Infrastructure
Business

Net Sales
Operating Income
Operating income
margin (%)

Electronic Equipment andComponents Business

Net Sales
Operating Income
Operating income
margin (%)

Communication andIndustrial Devices Business

Net Sales
Operating Income
Operating income
margin (%)

FY2023
ActualYoY（％）

FY2023
ROIC
（％）

1,133
77
6.8

1,232
107
8.7

8.7
39.6
+1.9pt

12.3

581
17
2.9

553
16
2.9

▲4.9
▲3.7
+0.0pt

6.4

333
18
5.3

307
14
4.5

▲7.6
▲22.1
▲0.8pt4.4

6

FY2024 Full-year Business Plan
Sales and profits are forecasted to increase due to sales growth resulting from investments to increase production of SICONEX ®
and a recovery in demand for high-performance products for EV.
Plan to increase the dividend by 20 yen from the previous fiscal year to 110 yen for the full year.

Net Sales(100 million yen)

Up 5.2%

Operating Income(100 million yen)

Up 5.3%
135

2,250
128

2,139

Ordinary Income

Recordprofits
expected

13.0 billion yen (YoY: 6.4% increase)
Recordprofits
expected

Net income attributable toowners of parent

9.0 billion yen (YoY: 1.8% increase)ROIC
8.7% (YoY: +0.4pt)
Dividend/Payout ratio

110 yen/36.1% (YoY: 20 yen increase)
FY2023 Result

FY2024 Plan

FY2023 Result

FY2024 Plan

Interim: 50 yen, Year-end: 60 yen
Total: 110 yen

7

FY2024 Full-year Change Factors
Change factors for net sales

FY2023

Effect of changes incopper prices

Energy andInfrastructure
Business+¥2.8 billion-¥3.7 billion

Electronic
Equipment
andComponents
Business+¥9.0 billion

Communication
and Industrial
devices Business

Others+¥2.3 billion+¥0.8 billion

Foreign exchange
impact: +¥0.2 billion

Electronic Equipment and Components Business¥213.9 billion

FY2024¥225.0 billion: 2.8 billion yen

Change factors for operating income
FY2023¥12.8 billion-¥0.5 billion+¥1.0 billion-¥2.2 billion

Elimination of temporary
losses+¥2.2 billion

Demandadjustments in theconstruction sector

Effect of improving
product mix andprofitability
Rise in material and Selling price passlogistics costs, etc. through and cost
reduction

FY2024+¥0.3 billion¥13.5 billion[Change factors]
1. Net Sales
Despite a projected temporary
decline in sales due to demand
adjustments in the construction andother sectors, sales are expected
to increase YoY due to a recovery
in demand for products for EVs.
2. Operating Income
Price pass-through and cost
reduction are expected to offset thehigher material and logistic costs.
Despite anticipated demand
adjustments in construction andother sectors, profits are expected
to increase YoY due to theelimination of temporary losses inthe telecommunications business,
product mix, and the effects ofimproved product mix and various
profitability improvements.

8

FY2024 Plan by Segment
Energy and Infrastructure Business
Construction
Seismic isolation/
Others(Unit: 100 million
1,300
yen, %)

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

Electric power infrastructure
Operating income （ ）Operating
income ratio

1,232

830

Electronic Equipment andComponents Business(Unit: 100 million
800
yen, %)

1,195

107
(8.7)

800

High-performance products
oxygen free copper
General-purpose products

600
500
400
300

336

340

66
FY202355
FY2024E

Copper price impact：ー
Positive factor●Contribution to sales from investment in increased productionof SICONEX®.
Negative factor●Demand adjustment in construction and other sectors.

200
100
0

25

670

700

102
(8.5)

Other high-performance
products
Operating income （ ）Operating
income ratio

66
212
FY2023

Communication cable
Precision devices

330

18(2.7)15100
240
FY2024E

10

400
300
200

5

100

0

0

Copper price impact：Net sales up 2.8 billion yen
Positive factor●Recovering demand for high-performance products for EV●Strong demand for products for heavy electrical equipment
Negative factor●Sluggish demand for products for industrial machinery

Wire harness
Operating income ((Unit: 100 million
yen, %)

20

553

16
(2.9)
274

Communication and Industrial
Devices Business) Operating
income ratio

30
330

307

175

168

83

14
(4.5)

98

57

57

FY2023

FY2024E

22(6.7)20
100Copper price impact：ー
Positive factor●Growing demand for high-speed communication cables forautomotive applications●Elimination of one-time losses in the communications cable business
Negative factor●ー9２．Medium-term Management Plan “Change & Growth SWCC 2026” Rolling Plan 2024

10

Formulating Rolling Plan 2024 under the Medium-term Management
Plan

Takayo Hasegawa,
Executive President and Representative Director (CEO)The first half of our Medium-term Management
Plan that began in 2022 has ended. Looking backon the past two years, we have made steadyprogress towards our stated KPIs. We havestrengthened the earning capabilities of our corebusinesses by investing in increased production ofstrategic products and enhancing the profitability of
our cash cow business through digitaltransformation (DX). Additionally, we haveachieved some results in creating new businesses,
such as the launch of the Smart Stream business.
However, issues remain in the new development of
our overseas business due to delays to our planscaused by the COVID-19 pandemic andgeopolitical risks.
Meanwhile, the business environment has
undergone considerable change since the current
Medium-term Management Plan was drafted in
November 2021. Under this rolling plan, we willtake these changes into account as we revise ourbusiness and investment strategies, make further
investments in growth drivers, and draw up

measures aimed at portfolio transformation. While
we have made an upward revision to operating
income with a new target of 17 billion yen to beachieved through organic growth, we will
implement measures to further increase this figure
through investment that leads from stability to
growth, and hope to make this a big step bringing
us closer to our 2030 vision.
More specifically, we will further refine ROIC
management, strengthen our ability to generatecash flow from business operations, and employ
enhanced capital strategy to optimize the cost ofcapital and enhance shareholder return. In addition
to enhancing our human capital strategy without
backtracking on the reforms we have made to date,
we will also focus on business development (BD)strategy to broaden the areas where we operate
as an upside element (inorganic) to the latest
target figures.
Stay tuned for this new beginning of the SWCC
Group's Medium-term Management Plan: Change& Growth SWCC 2026 Rolling Plan 2024.

11

SWCC VISION 2030: What We Want to Be by 2030
Based on the core technologies cultivated by SWCC
to date, we aim to create new value leading toa better future and further enhance corporate value.
Energy and infrastructure
Improving production efficiency
through DX
Making strategic products thedefault standard

Improving
economic value

Electrical equipment
and components
Shifting from wirematerials to high valueadded products

SWCC VISION 2030
It‘s not only with our traditional
cable and wire for infrastructure.
SWCC is committed to becoming
a value-creation company that
proposes solutions.

Comprehensive
electric wire
manufacturer
Electric wire
manufacturer

Organic growth &inorganic growth

Communication and industrial devices
Going beyond products for offices andconsumer electronics and entering new fields
such as products for ADAS

Improvingsocial value

Building social infrastructure that
supports people's lives
Contributing to labor saving andpower conservation

12１） Medium-Term Plan Rolling Targets and Business Strategies

13Changing Perception of the Business Environment
Expected Trends When the Medium-termManagement Plan Was Announced(as of November 2021)

Segment

Construction• Slight decrease in the medium- to long-term despite
redevelopment activities in the Tokyo metropolitan areaand expected demand ahead of the Osaka Expo

• Increased demand due to redevelopment activities in the Tokyo
metropolitan area
• Higher demand for new factory construction and the Osaka Expo
• Lengthened construction schedules due to labor shortages• Expansion of demand for offshore wind, etc.
• Expanded demand to upgrade aging equipment• Expanded demand to upgrade aging equipment• Growth in demand to expand power transmission and distribution
networks• Withdrawal of competitors• Expansion of demand for offshore wind, etc.
• Growth in demand for large-scale data centers• Growing demand in products for BEV• Despite a market recovery, demand for BEV slowed while
recovery of demand for HEV expanded• Widespread adoption of CASE
• Growth in demand for motors• Increase in telecommunications equipment and traffic• Increase in telecommunications equipment and traffic• Expansion of overseas telecom and datacom markets• Growth of the ADAS market• Global market expansion• Slight demand uptick in Japan• Slowing market expansion in China and Southeast Asia
• Greater demand for high-end home appliances• Diversification of commercial printing demand• Recovery of demand from the drop in COVID-19-related special
demand• Diversification of commercial printing demand

Energy andinfrastructure
Electricity

Electricalequipment andcomponents

Automotive

Communications
Communication andindustrial devices Home appliances
Office equipment

Rolling Plan 2024 Forecast(FY2024 to FY2026)

14

Positioning of Rolling Plan 2024
Working toward the vision for 2030, we will further evolve into a value creation company with Rolling Plan 2024.
Medium-term Management Plan FY2022-FY2026 Change & Growth SWCC 2026

SWCC
VISION
2030

Progress in FY2022-FY2023

Rolling Plan 2024

● Strengthened the earning capabilities of our corebusinesses by investing in increased production ofstrategic products and enhancing the profitability of our
cash cow business through DX

Enhancing the ability to generate cash flow bypromoting ROIC-oriented management● Creating new businesses such as the launch of theSmart Stream business and making the ICT businessprofitable

Optimizing the cost of capital

FY2024-FY2026● New expansion of overseas business including theestablishment of the local-production-for-localconsumption model in the China business and theestablishment of joint venture companies

Expanding investment in intangible assetsIt‘s not only with our
traditional cable andwire for infrastructure.
Becoming a value
creation company

Structural reform phase
Growth phase

FY2022

FY2023

FY2024FY2026

FY203015

Rolling Plan 2024: Target Financial Figures
The new target figures represent upward revisions due to organic growth. We will aim to further expand theupside through inorganic growth.
Before Rolling Plan
FY2023

Profitability

Capital efficiency

Shareholder
returns

FY2026After Rolling Plan
FY2026(Results)(Targets)(Targets)12.8 billion yen

15.0 billion yen

17.0 billion yen

ROE

12.3%

10% or more

14% or more

ROIC

8.3%

10% or more

10% or more

90 yen120 yen or more

150 yen or more

(35%/not set)(35% or higher/4%
or higher)

D/E ratio

40%

50% or less

30–50%Net assets

77.1 billion yen

85.0 billion yen or more

93.0 billion yen

Operating income

Dividends(dividend payout
ratio/DOE)

Stability(30%/3.7%)

16

Medium-term Management Plan:
Progress on KPIs and Key Points of the Rolling Plan
Operating income(100 million yen)
Pre-rolling target

ROE
Difference frompre-rolling targets

Difference frompre-rolling targets

Results + Rollingplan targets+2.0 billion yen
170

100

FY2022

FY2023

FY20260pt

14.0%

10.0% 10.0%

12.3%
10.0%

105

Difference frompre-rolling targets+4.0pt

15.0%

150
128

ROIC

FY202210.0%

FY2023

FY20267.0%

7.1%

FY20228.3%

FY2023

FY2026

Achievements

Progress outpaced the targets set before therolling plan thanks to strongly performing
businesses and the effects of improved
earnings.

In addition to improving the profitability ofcapital through the promotion of ROICoriented management, ROE prog in part due
to the disposal of non-operating assets aspart of structural reforms.

By promoting business-specific ROIC, we
enhanced capital efficiency companywide,
leading to steady improvements to ROIC.

Rolling

We will upwardly revise the targets to be reachedby the final year of the plan through proactive
investment in growth-driver businesses and astrategy of expansion into new business fields
leveraging our core technologies.

Despite shareholders' equity continuing toaccumulate, we will maintain ROE at a highlevel that exceeds the cost of shareholders'equity by further expanding business earnings.

While continuing to invest in business growth,
we will expand ROIC by further expanding
business earnings and improving capitalefficiency.

17

Medium-term Management Plan:
Progress on KPIs and Key Points of the Rolling Plan
Dividends per share (yen)Pre-rolling target
Results + Rollingplan targets

D/E ratio

Difference frompre-rolling targets

Difference frompre-rolling targets

Difference frompre-rolling targets+30 yen-20.0-0pt

8.0 billion yen
930

150
120

850
70%

771
61%

50

Rolling

40%

60

FY2022

FY2023

684
600

50%

90

Achievements

Net assets (100 million yen)

FY2026FY2022

FY202330-50%FY2026FY2022

FY2023

FY2026

Achieved improvements to financial
soundness while increasing the dividend
payout ratio to 30% in FY2023.

Reduced interest-bearing debt and achieved
an improved financial position by expanding
shareholders' equity against a backdrop ofstrong business performance.

Enhanced shareholders' equity with a focus
on the accumulation of business earnings,
achieving stabilization of the financial base(end of FY2023: capital adequacy ratio of47%).

We will aim to further expand shareholder
return in balance with growth investments,
setting dividend target of 35% or more for thedividend payout ratio and 4% or higher for
DOE.

While maintaining a measure of financial
discipline, we will also make use of debtbased financing and work to reduce WACC.

To ensure sufficient funding capacity for
growth investments and diversify funding
methods, we will aim to achieve an external
credit rating of A- or higher and further
strengthen our financial base.

18

Medium-term Management Plan:
Progress on P/L by Business and Key Points of the Rolling Plan
We will work to expand solid growth in the Energy and Infrastructure Business and improve companywide
earnings while revising the upside of targets in the final year of the Medium-term Management Plan for both net
sales and operating income.
Net sales (100 million yen) Rolling Plan targets

2,430

+280

2,139
553

Electrical equipment andcomponents

FY2023Copperprice(yen/kg)(CAGR 0.2%)

307

1,232

1,262

(CAGR 4.3%)

2,150Communication andindustrial devices

Energy and infrastructure

-

428
614

Operating income (100 million yen) Rolling Plan targets

-68
+116

360
730

7.0%
6.0%

128
14
16

1,240

107

FY2026
Before the
Rolling Plan

FY2026
Target Afterthe Rolling Plan

FY2023

870

1,250

979

+261

Operating margin

7.0%

170

+20

(CAGR 9.9%)

150(CAGR 5.4%)
Communication andindustrial devices
Electrical equipment andcomponents

Energy and infrastructure

-

45
26
80

FY2026
Before the
Rolling Plan

-10
０

+32

35
26

112

FY2026
Target Afterthe Rolling Plan

19

Medium-term Management Plan: Progress on P/L by Business
Energy and Infrastructure BusinessElectronic Equipment and Components BusinessCommunication and Industrial Devices Business

Factoring in solid growth in construction-related andpower infrastructure sectors, we have significantly
revised the upside of target values for the final yearof the plan

Factoring in a recovery in demand from FY2024 and beyond
despite the impact from reduced automotive production overthe past two years, we have left target operating income
unchanged for the final year of the plan

Factoring in delayed plans for wire harnesses andprecision devices despite strong performance ofcommunication cables, we have revised target values
downward for the final year of the plan

Net sales and operating income (100 million yen)
Rolling Plan targets

Net sales and operating income (100 million yen)
Rolling Plan targets

Net sales and operating income (100 million yen)
Rolling Plan targets

107

1,232

80

Price of copper
Estimated at
1,250 yen

112

Price of copper
Estimated at
1,250 yen

1,148

1,240

16
553

979
Construction
related

820

830
617
Announced
in November
2021

Other high-performance
products

Electric power andinfrastructure

336

303

360

Seismic isolationand other products

66

59

60

Copper price (yen/kg)

High-performance
products
Oxygen-free copper

FY2023

FY2026
Target Before the
Rolling Plan

FY2026
Rolling Plan Targets

1,262

870

1,250

General purpose
products

274

66

26

833

26
730

428

614
350

307

325
Announced
in November
2021

441

140

Communication
cables168

240

FY2023

FY2026
Target Before the
Rolling Plan

FY2026
Rolling Plan Targets

870

1,250

180
Announced
in November
2021

185

180

98
190

35
360

14

212

Copper price (yen/kg) 1,262

45

Price of copper
Estimated at 1,250 yen

115

Wire harnesses

83

Precision devices

57

68

60

FY2023

FY2026
Target Before the
Rolling Plan

FY2026
Rolling Plan Targets

1,262

870

1,250

Copper price (yen/kg)

20

Rolling Plan 2024:
Business Investment Plan and Timing of Profit Contribution
We will introduce a Group-integrated system from FY2024 onwards and promote business streamlining. We will also strengthen investments
in human capital, including welfare facilities. In FY2026, we will expand capital investment in the Energy and Infrastructure Business.
Operating income target

Capital investment (after Rolling Plan)
Plan Before the Rolling Plan
Cumulative Investment
from FY2022 to FY2026

31.0 billion yen

Plan After the Rolling Plan
Cumulative Investment
from FY2022 to FY2026

36.0 billion yen
Investment in long-term renovation
and renewal:
12.4 billion yen(100 million yen)

DX investment, etc.

Increased production andnew investments
Long-term investment /renewal investment

57
43
7
1
17

13

2.0 billion yen

DX investment, etc.:

9.0 billion yen

24

6

31

23

4

FY2022

250

15

170
39

128

16
31
37

18

80

7

2

Increased production andnew investments:
12.6 billion yen
R&D, etc.:

90

90

R&D

(100 million yen)29

29

FY2025

FY202611
FY2023

FY2024FY2023

FY2026
Target after the
Rolling Plan

2030

21

Rolling Plan 2024: Strengthening Business Portfolio Management
In light of the current positionings on a sub-segment basis, we will strengthen business portfolio management
over the course of the Medium-term Management Plan up to FY2026.
Business portfolio as of FY2023
Big

New market andnew domain
businesses

Growth driver businesses

Growth potential
Small

Electricity

Seismic isolation

Construction

Industrial devices

Assess businessturnaround andbusiness retention

Problembusinesses
Small[Power]Work to expand business through proactive growth investment instrategic products[Construction]
Enhance earning strength through DX promotion and pursue cash
cow business in greater depth[Industrial Devices and Communication]
Enhance growth potential and profitability while working to transform
into a growth driver business[High-performance Products]
Aim for business expansion in line with growth of the xEV market

Strengthen growth investments to accelerate growth

Improved productivity
through theenhancement of highvalue-added products

Communications

Business portfolio management over the course of
the Medium-term Management Plan

Identification ofproblem businesses

High-performance
products
General purpose winding wires[Seismic Isolation]
Recognized as a problem business due to expected slowdown ingrowth potential and profitability

Creation of stable cashflowsCore businesses
ROIC spread by business

Assess business turnaround and business retention● Competitive advantages● Capital efficiency ● Growth potential● Our vision ● Synergy with other businesses

Big[General Purpose Winding Wires]
Recognized as a problem business due to expected earnings decline
due to intensifying competition

SWCC Group ROIC Calculation Formula
Corporate ROIC = Operating income after tax ÷ invested capital (shareholders' equity + interest-bearing debt) / Business-specific ROIC = operating income after tax ÷ invested capital (working capital + fixed assets)

22

Rolling Plan 2024: BD Strategy (New Business and M&A Activities, etc.)
We will strengthen our Business Development Strategy (inorganic growth), an upside element to the Rolling Plan 2024
targets (organic growth), aiming to contribute to profit between FY2026 and FY2030.
Operating Income (100 million yen)
Targets

BD Strategy by Segment: Priority Measures+ additional (Inorganic Growth)Target domains where SWCC can apply its strengths
and complement new domain technologies and its
customer baseEnergy andinfrastructure

Strengthening the solution
business
Smart Stream Business +Utilization of M&A → page 24

Electricalequipment andcomponents

Strengthening of downstream
strategy
Pursuing core technologies ingreater depth + Utilization of
M&A → page 28

Communicationand industrial
devices

Expansion of overseas business
areas
Enhancement of strategic
products + Utilization ofpartnerships → page 31+ additional

Inorganic growth
FY2026-FY2030•Total amount of growthinvestments
20.0 billion yen+128

+ additional

Organic growth
FY2026170

250•Total amount ofbusiness investments
9.0 billion yen•Operating income
expected
17.0 billion yen

FY2023

FY2024FY2025

FY2026

FY203023

Rolling Plan 2024:
Growth Strategy for the Energy and Infrastructure Business (1)Market Forecast FY2024-FY2026• Increased demand due to redevelopment
activities in the Tokyo metropolitan area
• Higher demand for new factory
Construction construction and the Osaka Expo
• Lengthened construction schedules due tolabor shortages

Electricity

Medium-term Rolling Plan Targets

Capital Investment Plan

Net sales and operating income (100 million yen)

45
40
35
30
25
20
15
10
5
0

107

• Expanded demand to upgrade aging
equipment• Growth in demand to expand powertransmission and distribution networks• Withdrawal of competitors• Expansion of demand for offshore wind, etc.
• Growth in demand for large-scale data
centers

1,232

Construction
related

830

112
102

1,240

1,195

Expected
price ofcopper
1,250 yen

• Raise profitability with differentiatingproducts (high-end disaster resilient
Construction cables, workload-reducing cables)• Improve profitability by implementing

Electricity• Maximize contributions from investments
in increased production of SICONEX®
connectors for high-voltage power cables• Promotion of human resources training• Promotion of solution-oriented
businesses (Smart Stream)Powerinfrastructure
Seismic isolationand other products

336

340

360

66

55

60

FY2023Results

FY2024
Plan

19

FY2024Plan-

FY2026
Target After the
Rolling Plan

ROIC

12.3%

12.5%

12.8%

WACC

4.5%

5.0%

5.3%

FY2025Plan

FY2026
Plan

Comparison of FY2023
and FY2026 Portfolios
Growth Potential: Net Sales CAGR

Basic Strategy

42

26

820

800

(100 million yen)

●FY2023●FY2026＋
Electricity
Seismic
isolation

Constructionーー+Profitability: ROIC Spread24

Rolling Plan 2024:
Growth Strategy for the Energy and Infrastructure Business (2)Enhancement of our strategic products and solutions (SICONEX®/SICOPLUS®) to meet growing demandfor electric power driven by national policies
Profit expansion
Forecast of the domestic electricity market (based on SWCC research)

strategy 1

2014 onwards: Strengthening and taking action on aging (National Land Resilience Plan)
2020 onwards: private-sector renewable energy investment (publicly
solicited offshore wind power)
Transformers coming
due for renewal during
our Medium-termManagement Plan
Aging distribution of transformers(66 kv - 500 kv, oil-filled)(Million yen)
6,000,000

2022 onwards: expansion of the data center market
2023 onwards: Development of
renewable energy transmission
networks
Forecasts of the data center
market2023-2028 CAGR 6.8%2023 onwards: Revenue Cap
systemTransformers [units]

5,000,000
Results of units
replaced or newly
installed in thepast year: approx.
260 units / year

4,000,000

Products• Made into the de facto standard• Enhancement of ultra-high voltage SICONEX®
• Consideration of further investments in increased
production

People• Construction human resources center• Expanded alliances with construction companies• Transitioning internally-trained employees to workon ultra-high voltage<Results of study into unevenly
distributed power supply scenario(45GW)>

6-7 trillion
yenDX

3,000,000

Three measures for the electricity market• Educational support through use of AVR• Remote support, management solutions

2,000,000

SICONEX® Sales Growth Plan

1,000,000

Source: Organization for Cross-regional Coordination ofTransmission Operators, Japan (OCCTO),
Aggregation of Electricity Supply Plains for FY2024

02022 2023 2024 2025 2026 2027 2028
Source: Data Center Business Market Research Overview 2024
<Market Edition> Fuji Chimera Research Institute, Inc.
* 2023 figures are expected values, figures for 2024 andbeyond are forecasts.

FY2030240

Source: Organization for Cross-regional Coordination of Transmission
Operators, Japan (OCCTO) Long-term Policy for Wide-area Grid
System (Master Plan for Wide-area Interconnection Grid)<Supplement (Reference Edition)>

FY2023-FY2026 Transformer market CAGR: 11%, SWCC CAGR: 18% *Based on SWCC researchElectric power

SWCC's company demand
sectorshare Privatecompany demand

FY2023

FY2024FY2026

FY2030

51%

58%

71%

88%

93%

93%

94%

95%

FY2023100

FY2024135

FY2026200* When FY2023 results are indexed to 100

Construction Personnel Plan

FY2023 FY2024
100
115

FY2030130
FY2026125

Cooperation with nationwide
construction companies* When FY2023 results are indexed to 100

25Rolling Plan 2024:
Growth Strategy for the Energy and Infrastructure Business (3)Profit expansion
strategy 2

Roll out of Smart Stream to electric power companies(promotion of the solution business)

Challenges facing theelectric power industry:Building resilience
Extending and developing
wide-area power transmission
and distribution equipment
Aging equipment
Improving productivity andensuring safety

Ensuring construction supply capabilities
Preventing incidents

AI (image /forecasting)

Providing solutions offering safety and peace of mind
(technical skills transfer, improved efficiency,
elimination of occupational accidents)
Upside plan underthe BD strategy

Reducing labor required for equipment maintenanceand streamlining equipment management

Remote support andmanagement

Image
AI

AVR

Developing a lineup of solutions
AVR

Development of a solution business

Sensing

Sensing

Predictive
AI

Acquisition of
resources and newtechnologies

RemotesupportExpandingthe SICONEX market

Business of selling goods(Base load)

26

Rolling Plan 2024:
Growth Strategy for the Electric Equipment and Components Business (1)Market Forecast FY2024-FY2026
Highperformance
products

Medium-term Rolling Plan Targets
Net sales and operating income (100 million yen)

• Expanding recovery of demand for
HEV despite a slowdown in BEV
adoption• Widespread adoption of CASE
• Growth in demand for motors

26
16

730

Other highperformance
products
Generalpurposeproducts

350

330

10

8

0

FY2024
Plan

274

66
212

FY2023Results

14

5

553
Highperformance
products
Oxygen-freecopper

16

15

140

100

240

FY2024
Plan

240

-

FY2026
Target After the
Rolling Plan

ROIC

6.4%

6.8%

8.6%

WACC

4.2%

4.6%

4.6%

FY2025Plan

FY2026
Plan

Comparison of FY2023
and FY2026 Portfolios
Growth Potential: Net Sales CAGR

Highperformance
products

18

20
Expected
price ofcopper
1,250 yen

670

Basic Strategy• Building a flexible system for BEV
and HEV adoption• Development and manufacturing of
new high value-added products• Launch of green vehicle winding
wire (CO2 reduction)• Increased production of heater wires• Development of probe pins forsemiconductors• Joint development with Tohoku
University• Structural reforms(Development of an integrated
production system for heater wires:
FY2025 onwards)

Capital Investment Plan (100 million yen)

●FY2023●FY2026＋
High-performance
productsーGeneralpurposewinding wiresー+Profitability: ROIC Spread27

Rolling Plan 2024:
Growth Strategy for the Electric Equipment and Components Business (2)We will shift from an upstream to downstream strategy, increasing profit by shifting positioning to highvalue-added products that take advantage of our strategic products and core technologies.
Areas of Focus

Our Strengths

MiDIP®

Wire rods

Products(Products and CoreTechnologies)

Insulation
technology
High-frequency
technology
Processing
technology

Flat winding
wires

Semi-finished goods

Copperalloys

Probe pins

Fire resistantbus bars

Power supply
coilsHigh heat resistance, high voltage, highefficiency

High flexibility, highdurability

High conductivity,
high durability

High voltage,
workabilityHighefficiency

Conductors for automotive motors

Heater wires

Semiconductor
inspection tools

Electric vehicles

Contactless
power supply

Use

Copper alloys

MiDIP®

Winding wires

Plan forFutureProfitExpansion● Flat winding wire: increased production plan
● Green vehicle winding wire: (material, fuel, equipment CO2 reduction)● Heater wire: increased production plan
● Probe pins for semiconductors: Launch of wire in FY2023, mass production starting FY2026● Fire resistant bus bar: Developed by applying the Group's expertise in fire resistance, expected to enter mass
production in 2027
● Contactless power transfer: Provided for Japan's first public road demonstration
testing in 2023, aiming for commercialization in 2030

Profit expansion
28

Rolling Plan 2024:
Growth Strategy for the Electric Equipment and Components Business (3)Profit expansion
strategy 1

Green vehicle winding wire

Begin sales of green vehicle winding wire from2025 against the backdrop of demand for low
carbon materials from customers
2030
2025
2024

Expand sale of green vehicle
winding wire

Sales launch of green
vehicle winding wire

Application of green energy
First introduction in Japan, production
using high-efficiency equipment

Scope 3 (Cat. 1)
For amount of procured
materials
reduction of up to 50%*

Production using
existing methods

Have greenhouse gas emissions(Scope 1 + Scope 2) verified by athird party organization

Increased productionof heater wires

Expansion of the alloy wire domain:
collaborative
research with Tohoku University
Anticipate global expansionof demand and strengthen
investment in increased
production and enhance lineup

Enhance the lineupof heater wires as adownstream
strategy

Profit expansion
strategy 3

Consolidate the process from basic research at
Tohoku University to product development andmanufacturing at SWCC in the Sendai area to develop
next-generation technologies and products.

Development and mass
production of probe pins

Target high revenue markets utilizing SWCC's unique characteristics(high conductivity and hardness)<Roadmap>

Scope 1 + Scope 2
80% reduction for amount of fueland electricity consumption** Limited to automotive winding wire

2023

Profit expansion
strategy 2

FY2026 target
Development of mass
production of pins

Semiconductor
inspection probe
Advanced logic / special
automotive applications

FY2024-FY2025 target
Pin commercialization andacquisition of customers
FY2023 result
Launch of wire for pins

Upside plan underthe BD strategy

Incorporate downstream
processes to expand
profit29

Rolling Plan 2024:
Growth Strategy for the Communication and Industrial Devices Business (1)Market Forecast FY2024-FY2026

Medium-term Rolling Plan Targets• Increase in telecommunications
equipment and traffic
Communications • Expansion of overseas telecomand datacom markets• Growth of the ADAS market

Net sales and operating income (100 million yen)

• Slight uptick in Japanese home
appliance demand• Slowing home appliance market
expansion in China andIndustrial devices Southeast Asia
• Greater demand for high-end
home appliances• Diversification of commercial
printing demand

Capital Investment Plan (100 million yen)
12

35
14
307
Communication
cables 168

22

360

330

8
Expected
price ofcopper
1,250 yen

6

FY2025Plan

FY2026Plan

2
FY2024
Plan

185

175

6

4

Comparison of FY2023 andFY2026 Portfolios
115

98

60

57

Results

FY2024Plan-

FY2026
Target After the
Rolling Plan

ROIC

4.4%

7.2%

11.0%

WACC

5.6%

6.0%

5.9%

Growth Potential: Net Sales CAGR

• Wire harnesses and precision
devicesIndustrial devices • Expansion of (roller) businessdomain60

Basic Strategy• Capturing of robust demand for
Wire harnesses 83
office LAN• Investment in increased
Communications production of automotive highPrecision devices 57
speed communication cables• Development of new partners
for e-Ribbon®
FY202310

10●FY2023●FY2026＋

Industrial
devices

Communicationsーー+Profitability: ROIC Spread30

Rolling Plan 2024:
Growth Strategy for the Communication and Industrial Devices Business (2)Profit expansion
strategy 1

Expanded entry into the automotive
high-speed communication market

Profit expansion
strategy 2

Automotive camera market
TargetMarkets

Winning
Strategy
Story

In the realization of advanced driver assistance systems(ADAS) and autonomous driving systems (ADS), viewing
cameras and sensing cameras contribute to improved
safety and the widespread adoption of autonomous
driving technologies

TargetMarkets

Partner strategy with Tier 1 partners (domestic
and overseas)
Collaboration with leading Tier 1 partners
Enhanced lineup of automotive high-speed transmission
cable types
Strategy for high added value by
incorporating extra features in cables

Mobility<Product Superiority>• Achieves high-speed data transmission with stabletransmission and high frequencies with low latency
and noise resistance for cameras with increasingly highresolutions and enhanced functionality• Ensures advanced automotive environmental performance(oil and chemical resistance, abrasion resistance, temperature
resistance, etc.)

Winning
Strategy
Story

e-Ribbon® overseas partnership strategy

Telecom and datacom markets

North America: Increased demand due to booming FTTx and DC
markets and compliance with Build America, Buy
America (BABA) requirements.
Europe:Solid demand will continue despite slowdown of FTTx
market growth
Asia:
Expanded demand toward the Taiwan FTTx market andincreased demand due to the booming Asia DC market

Overseas partnership strategy utilizing technologicaladvantages

We will utilize our technological capabilities that make us one of only
five companies in the world capable of mass production and roll out
a local-production-for-local-consumption strategy through overseas
partnerships.

<Product Superiority>• Outer diameter reduced by up to 34%• Weight reduced by up to 40%• Capable of simultaneousadhesive bonding with flexible
ribbons

World
class

Upside plan underthe BD strategy

World
class

Building overseas
partnerships that maximize
technological advantages

31

Rolling Plan 2024:
Growth Strategy for the Communication and Industrial Devices Business (3)Profit expansion
strategy 3

Strengthened competitiveness and multifaceted expansion
through overseas partnerships for wire harnesses

To DateSpecialization in products for highgrade home appliances producedby leading Japanese manufacturers

Future Growth Strategy

Good
relationships
with Japanesecompanies

Strengthening competitiveness through Chinese joint
venture company established with motor manufacturer

Enhanced competitiveness through cost
reductions and quality improvements(High-grade home appliances)

Promotion of stable supply through thedecentralization of sites(2024 launch)JIAXING

Progress made in structural reforms(1) Diversification of production
sites(Two sites in China, one site in Vietnam)(2) Promoting local procurement,
and local production for local
consumption(FY2022 Chinese site procurement rate: 74%)

DONGGUAN
HUNG YEN

For high-end home appliances
For regular home appliancesMulti-faceted expansion through a Chinese joint
venture company established with an automotive
components company and autonomous driving
software development company
Rapid entry into the ADAS-related component
market through collaboration with a company thatdevelops automotive sensors and radars(2024 launch)

For autonomous driving

32

Rolling Plan 2024: Strategy for the Overseas Business
Growth of the overseas business was delayed from our initial plans. We will accelerate growth ofthe overseas business by implementing new additional measures.
Results During the Medium-termManagement Plan

Challenges During Rolling Plan
2024

• Established a local-production-for-localconsumption model for wire harnesses andprecision devices• Established a wire harness joint venture• Expansion into the automotive components
field• Expansion of the precision device (roller)
field• Establishment of partnerships in anticipationof a new overseas expansion for e-Ribbon®
• Further strengthening overseas governance■ Overseas net sales (100 million yen)and percentage of overseas sales
14%
295

8%

Planned upside
under the BD
strategy

10%
250

178
Ongoing Measures

Parallel expansion withJapanese customers
Entry into new markets

Additional Measures in Rolling Plan 2024
Enhancement of theoverseas business
utilizing producttechnologies

Development of newpartners in the overseas
business

Head offices for each overseas region(strengthening governance and investment efficiency inthe overseas business)

FY2023

FY2024FY2025

FY2026FY2026
Target Before Rolling Plan
the Rolling
Targets
Plan

33２） Capital & Financial Strategy

34

Approach to Financial KPIs
FY2026 Targets
Toward a market capitalizationof 150 billion yen
Rating of A- or higher

Improved
corporate
value andshareholder
value
Total shareholder return

TSR expansion• Increase in the shareprice• Increased dividends

Outperforming TOPIX(including dividends)

Expanded equity spread• ROE of 14% or more

Improved cash flow

• EBITDA margin of 9％ or above• Improved CCC of 80 days or less* Cost of shareholders' equity assumed to be
9% or lower

Improved asset
efficiency

Enhanced shareholder
returns• Dividend payout ratio of 35%
or moreand• DOE of 4% or more

• ROIC of 10% or more
• Business portfolio management

Optimized cost of capital• D/E ratio between 30% and 50%• Capital adequacy ratio of around50%• WACC controlled in the 6% range

35

Cash Allocation
We have improved the ability to generate cash over the past two years by improving capital efficiency throughenhanced earning capabilities, a reduction in working capital and the sale of non-operating assets. Therefore in the rollingplan, we will work to invest in business expansion that leads to future cash flow and enhance shareholder return.
After the Rolling Plan
(Cumulative Amount from FY2022 to FY2026)

Before the Rolling Plan
(Cumulative Amount from FY2022 to FY2026)
Cash inflows

Cash flows fromoperating activities
61.7 billion yen

Cash outflows

Cash inflows

Cash outflows
Capital investment
Machinery and equipment,
etc.:
25.0 billion yen

Business investment
51.0 billion yen

Cash flows fromoperating activities
69.0 billion yen

Business investment,
etc.
62.0 billion yen+

Shareholder returns
10.7 billion yen

FY2026 shareholder returns
Dividend payout ratio of
approx. 35%
Dividend per share of
120 yen or more

Procurement ofinterest-bearing debt
2.0 billion yen+
Sale of crossshareholdings
Real estate, etc.

Sale ofnon-operating assets
11.5 billion yen

Shareholder returns
20.5 billion yen

Human capital investment
Welfare facilities, etc.:
2.2 billion yen
DX investment, etc.:
6.8 billion yen
BD investment
M&A activities, etc.:
20.0 billion yen+
Other (increase in cash on
hand, etc.)
6.5 billion yen
Shareholder returns policy
Dividend payout ratio of
35% or moreand
DOE of4% or more

36

Shareholder returns
In addition to dividends based on a dividend payout ratio of at least 35% and DOE (dividend on equity) of atleast 4%, we will consider the flexible acquisition of treasury stock, comprehensively taking into accountfinancing needs for growth investment and other factors.
Trend in dividends per share (yen) andthe dividend payout ratio
Shareholder return policy
36.1%
30.3%

Dividend payout ratio of at least 35%
and DOE of at least 4%
Taking into account the situation with accumulating
shareholders' equity, we have set a new DOE(dividend payments divided by shareholders' equity)
as the minimum threshold for dividends, to ensurethat a certain level of return is provided toshareholders even if a downturn in earnings has
occurred.

35.0%

12.0%

16.0%

150

19.1%

110
90

50

60

20
FY2020

FY2021

FY2022

FY2023

FY2024Plan-

FY2026
Rolling Plan
Targets37

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 thestatements.
Such factors that may affect actual results include economic conditions, demand trends, and fluctuations in raw material prices andexchange rates.
Factors that may affect business performance include, but are not limited to, the above.