Mid-Term Management Plan

Challenge 2024
1

TOPICS

信 頼 と 限 り な き 挑 戦

１

Introduce new business portfolio management
Set a portfolio to 3 domains—Focus, develop, Base （P14）２Formulate 5 strategies for mid-term management plan, in accordance with business
policy “Aiming to improve corporate value through Business portfolio optimum”
（P19）

３

４

Formulate a Mid- to Long-term plan
FY2024 goal：Operating Income 3.0 billion yen,ROE 8%FY2030 goal：Operating Income over 5.0 billion yen （P28）
Formulate a management strategy with strong awareness of ESG（P31）・ Calculate GHG emissions for realization of carbon neutrality （P33）・ Clarify a financial policy. Optimize the overall balance of growth investment, not limit…… equipment investment （P36）…
2Outline

信 頼 と 限 り な き 挑 戦

I. Review of the previous Mid-Term plan “Waku Waku 21”
II. Carlit Group's long-term vision
III. Mid-Term Management Plan Challenge2024- 1. Acceleration of growth businesses- 2. Expansion of R&D- 3. Improvement of profitability of existing businesses- 4. Advancement of ESG management- 5. Restructure of business infrastructure3

I. Review of the previous Mid-Term plan

“Waku Waku 21”

4

Review of the previous Mid-Term plan

信 頼 と 限 り な き 挑 戦

 Reflect the previous Mid-Term plan problems in the new Mid-Term plan
Build up a solid business foothold in a
profit-oriented manner and promote
investments of management resources
for new initiatives.

Average：Sales-oriented ：Insufficient profit-oriented awareness
Poor ：Short-term viewpoint：Failed to actively invest

management resources due to immature growth strategies〈 The concept of the previous mid-term plan 〉
New Initiatives• R&D

・New business• Ｍ＆Ａ• Overseas Business
Solidification of business foothold• Strengthen the foundation ofexisting and peripheral businesses☁🌧☀〈 Review of the previous mid-term plan〉〈 Basic theme〉

Poor ：Sticking to existing businesses
Poor ：Insufficient focus on R&D and new businessPoor ：Lack of strategic approach to M&A in growth areas
Average：Withdrawal from Vietnam and Singapore
Excellent：Slight increase in sales and profit

Favorable market environment for existing businesses

Average：Lack of awareness of financial goals Insufficient profitability.
Excellent：Acquired Minamisawa Construction Co.

Expansion of peripheral businesses

5Review of the previous mid-term plan
FY2018 Actual

信 頼 と 限 り な き 挑 戦

FY2021 Plan

FY2021 Actual（Final Year of the previous Mid-Term Plan ）（At the bigining of the previous mid-term plan）

Sales※

34 billion yen

42 billion yen

34 billion yen

Operatingincome2.3 billion yen

3.0 billion yen

2.5 billion yen

ＲＯＥ

6％

8％

7％
※Sales are calculated based on the IFRS.

 Operating profit: -0.5 bn yen vs. plan [Breakdown] - 0.7 billion yen in new businesses and products,……………………………………………………………………………… +0.2 billion yen in existing businesses.

 COVID-19 has had a tremendous impact⇒ However, not only the negative impact, but also the recovery demandin the semiconductor and automotive sectors
 The decision to discontinue construction of a new bottling production line was made due to significant changes inmarket conditions, including a significant decrease in domestic and international tourist demand⇒ The impact on
6
the for-profit plan is negligible

信 頼 と 限 り な き 挑 戦

Review of the previous mid-term plan

 R&D and repair investments were implemented as planned Significant reduction in investment to increase capabilities is due to thesuspension of investment in new bottling production lines.
investment toincrease capabilities

Plan

R&D
investment

Repair investment

2.0 billion
yen

3.0 billion
yen

New Initiatives

investment in new bottling production lines
0.5billionyen

7.5 billion
yen

Solidification of business foothold

investment toincrease capabilities

Achievement

R&D
investment

Repair investment

1.7 billion
yen

3.0 billion
yen

0.7billion

Total results: approx. 6.0 billion yen

yen

7Carlit Group's long-term vision8

Our recognition of social issues

信 頼 と 限 り な き 挑 戦

 Organize and analyze social issues for 2030
Social issues

Keywords• Building an Information Society

Realization of Society 5.0• Digitization of Objects by Metaverse• Rise of Robots and AI• Promotion and Realization of MaaS

Convenient and Secure
infrastructure and mobility• Expansion of space development
and satellite industry• Realizing the Mobility of the Future

Richer andEco-friendly living

Projections for 2030
More advanced electronic devices
such as cell phones

Realization of High-Performance
Energy Storage Device

Supporting Lifestyles from Spaceand the Sky• Stable supply of Renewable Energy• Rise of Next-Generation Energy• Achieving an Environmentally
Conscious Supply Chain

Further promotion of clean energy
to achieve carbon neutrality
9信 頼 と 限 り な き 挑 戦

Basic Concept of the Carlit GroupManagement Philosophy

Earning Trust and Tackling Countless Challenges

Corporate Slogan

Giving Shape to Infinite Possibilities Our Approach to Stakeholders
Employees

ClientStockholders

 Respect for each individual's independence Valuing communication

 Challenges in Manufacturing to Meet Needs
 Providing services that meet expectations

 Make an adequate return on investment
by increasing the value of the enterpriseSociety＝ Significance of...
our company

Providing “secure" and"affluence" through reliable
manufacturing and services10信 頼 と 限 り な き 挑 戦

Ideal Carlit Group
Ideal Carlit
Group In 2030

To contribute to a sustainable society by
combining the power of "chemistry" and"technology" to support people's happy lives.
Our capital input

 Human Capital
Human resources to carry out our slogan
 Social and Relational Capital
Trusted by history
Brand strength for diverse markets
 Financial CapitalSound financial structure Intellectual and Manufacturing Capital
Basic research and accumulated knowledge
Creative and Development Technology Capability
Manufacturing Technology Natural Capital
Abundant Water Resources
Ownership of hydroelectric power plants11信 頼 と 限 り な き 挑 戦

Ideal Carlit Group Three stages we are taking toward 2030
2022 ～ 2024

～ 2027～ 2030

Mid-Term Management Plan

Stage1 :Challenge 2024

Strengthen the foundation• Introduce new business portfolio

Existing
businesses • Profit improvement

Stage2 :Investment Promotion• Thorough management in accordancewith the business portfolio

Harvest and BreakthroughROE 10%～• Establish a structure for earnings growth• Concentrated investment ingrowth businesses• Expansion of Growth businesses
Growthbusinesses • New product development based • Realization of new businesson core technologies

ESG

Stage3 :• Contributing to society

through our approach to materiality• Increase the value of growthbusinesses• Contribution of new business tobusiness performance

ROE 8%ROE 7%
12

Introduce business portfolio management

信 頼 と 限 り な き 挑 戦

 Predicting growth potential based on market trends
Realization of Society 5.0

Convenient and Secure infrastructure and mobility

The electronics and semiconductor industries, including power
semiconductors and advanced packaging, are expected to growworldwide

EV market, including automotive storage batteries, is expected
to expand rapidly.

Related Items

Electronic Materials

Silicon Wafers

Long-term global market forecast for power semiconductors

Storage Battery Market Forecast

Related Items
Electronic Materials(Million dollars)

Silicon Wafers
Power ICPower
ModulePower
Discrete

Next-Generation
Batteries Evaluation
Services

Growth rate(right axis)※1 The growth rate after 2030 is the average annual growth rate between the immediately
preceding forecast year and the relevant forecast year. e.g.2030: 2020 ~ 2030
※2 After 2030: Mizuho Bank Industry Research Division forecasts※3 Estimate as of July 2021
Source: Mizuho Bank Industry Research Division

For in-vehicle
For in-vehicle
For stationary ■ Other
driveauxiliaryuse
Source: Mizuho Bank Industry Research Division※ Estimated based on the assumption that increasingly strict electric vehicle-related regulations in each country will be in effect asof May 2021.

13

Introduce business portfolio management

信 頼 と 限 り な き 挑 戦

 Three business portfolios based on market growth potential and our strengths
Develop Areas

Focus Areas

GrowthPotential

 This areas expected to shift to focus areas within
3 years
 Allocation of resources to accelerate growth
Next-Generation
Batteries Evaluation
Services

Basic
Chemicals This areas where further earnings growth is expected Focused resource allocation to accelerate growth

Electronic
Materials

Base Areas This areas that contribute to stable corporate value enhancement
 Allocation of resources to sustain the business in the long term
as a source of revenue Promote segmentation of basic areas and distinction of improvement
areas in the execution of business portfolio management.

Return on Invested Capital

Silicon Wafers

Explosives andSignal Flares
Contract beverage
Manufacturing

Ceramic
Abrasive grain
Metalworking
Parts

Environmental Solutions(Construction, Architecture, Painting,
Design)14

信 頼 と 限 り な き 挑 戦

Carlit Group's Vision for Growth Establish focus areas based on market needs related to social issues

 During the mid-term plan period (~2024), specialize in "development of new applications"of existing product lines to generate profits
For 2030
Social Issue
Focus and Develop Areas

Electronic Materials
Realization of Society 5.0

Convenient and Secure
infrastructure and Mobility
Richer andEco-friendly living
Market scale

Silicon Wafers
Next-Generation Batteries
Evaluation Services

Basic Chemicals• Our “core technologies”• Concept of “chemical manufacturer”

Selected areas of focus and develop
We will concentrate our resources of people,
equipment, and money.

Repeatedly implement growthstrategies for focus and develop
areas
Oxidation
Reaction
Electrode and Technology“Evolution” andElectrolysis“Deepen” of core
Ionic
Technology
technologies
Compounds

Synthesis
Integrated Technology
Production Process
Expansion of focus
Technology

areas through new
products
15

信 頼 と 限 り な き 挑 戦

Carlit Group's Vision for Growth
Operating income (billion yen)

 Roadmap toward 2030 for the three areas

Focus Areas

Develop Areas Efforts in Focus and Develop Areas Creation of new products throughevolution of core technologies→ Successful growth businesses are
essential.

5.0
billion yen
2.5
billion yen

2021

3.0
billion yen

2024

Base Areas
 Review of management throughintroduction of business portfolio

Ideal Carlit GroupIn 2030

Achieving Ideal Carlit Group in 2030

by combining forces in all three areas.

 Model change of product lines tomeet customer needs
 → Improve and strengthen
profitability of existing businesses16信 頼 と 限 り な き 挑 戦

Materiality of Carlit Group Management with "ESG and Profitable Growth" Contributing to the realization of a sustainable society through materiality
Contributing to the creation of an affluent society

Ｅ

Environ-mental••••Contribution to Life and Environment
Promoting Supply Chain Management
Contribution to Smart Society
Promote climate change actionand environmental management

Ｇ

Govern-ance

ＳSociety• Ensure credibility regarding
the determination of material facts• Legal Compliance• Advanced cyber security
and DX implementation

Coexistence with society

Creating a safe, secure, and vibrant work environment• Employee Satisfactionand Health Management• Ensure human resources educationand diversity of human resources• Responding to Work System Reform• Maintaining a safe and hygienic work environment

Strengthen management foundation for reliability,transparency, and profitability

Ｓ

Society• Advancement of ESG Management• Restructuring of business infrastructure• Contribution to safety and security• Communication with Stakeholders• Contribution to sustainable
development of local communities

Implement these two points
as a management strategy
17Mid-Term Management Plan

Challenge 202418

信 頼 と 限 り な き 挑 戦

Management Policies and Strategies

 To realize our "Vision for 2030" we are pursuing the following strategies
Management
PolicyChallenge 2024
5 Strategies

Aiming to increase corporate value
by optimizing the business portfolio

Part 1Strategy execution through PDCA cycle→ Plan to proceed while reviewing

1.
2.
Accelerate growth Expansion of R&D
businesses

Part 2

4.
Advancement of
ESG management

3.
Improvingprofitability ofexisting businesses

5.
Rebuilding ofbusiness
infrastructure19Mid-Term Management Plan

Challenge 2024
Part 1
1.
Accelerate growthbusinesses

2.
Expansion of R&D

3.
Improvingprofitability ofexisting businesses

20Challenge 2024 3 strategies related to performance

信 頼 と 限 り な き 挑 戦

 Build strategies for each of the three areas and execute portfolio management
2.
1.
Expansion of R&D Focus Areas
Accelerate growth
Focus Areas
businesses

Develop Areas

Develop Areas
Next-Generation
Batteries Evaluation
Services

Focus Areas
Basic
ChemicalsElectronic
Materials

Silicon Wafers

Base Areas
Explosives andSignal Flares
Ceramic
abrasive grain

Contract beverage
manufacturing
Metalworking
parts

Environmental Solutions(Construction, Architecture,
Painting, Design)

3.
Focus Areas
Improving
Develop Areas
profitability ofexisting businesses Base Areas

Focus Areas：3 Strategies
Develop Areas：２Strategies
Base Areas：１Strategy
Number of strategies for each area
＝ Resource allocation ofpeople,equipment, and money21

1. Accelerate growth businesses

Electronic
Materials

信 頼 と 限 り な き 挑 戦

 Continuing to respond to new "needs" with our strengths and specificity
 Become a one-of-a-kind+ Niche Top Company by Our Unique Assets• Targeting the expanding market for the advancement of smart society

Assumed → Developing products with the aim of becoming a one-of-a-kind chemical manufacturer
Market • Provide special high value-added materials necessary for the development of devices
and systems such as PCs, 5G, in-vehicle systems, IoT modules, etc.

Growth Policy (Sales)

Growth Policy (Investment)• Accelerate expansion into overseas markets,mainly targeting China• In-house production of core processes• Increase product lineups that are both uniqueand have high market appeal by capturingneeds through communication with customers.

→ Expanding Profitability→ Improvement of technical capabilities

221. Accelerate growth businesses

SiliconWafers

信 頼 と 限 り な き 挑 戦

 Creating areas that major manufacturers "can't make it" from areas that they " don't make it"AssumedMarketStart by approaching markets where major competitors "don't make it"Creating new markets together with our customers in areas where "can't make it".
 Special Quality
 High value-added
products

Developing valuable wafers to support industry andtechnological innovation where semiconductors are in
short supply

Growth Policy (Sales)• Meeting the needs of customers
in ”Insufficient wafers” and “Special wafers”• Evolution of special wafers from customer
information to more specific wafers• Providing services from the development
phase and making great strides in sales
through mass production

Growth Policy (Investment)

Renewal of manufacturing equipment toenhance functionality
productivity increase：Renewal of 2 single crystal
silicon ingot pullers
Labor and energy saving：Automatic mounting
machcine
High value-added products：high precision single
wafer polishing machine, annealing chamber 23

BasicChemicals

1. Accelerate growth businesses

信 頼 と 限 り な き 挑 戦

 "Propellant raw materials" in the " Develop Areas : Basic Chemicals" Combining our expertise in oxidation reactions and hazardous materials andchemicals to create security and abundance in "space" and "sky"Assumed Market• Increased demand for defense, essential fordomestic production

Status of spaceport projects under consideration and opening
in each country and major initiatives
Spaceport Cornwall
 Cornwall Airport
Newquay（自治体保有の空港）を利用 初期投資として英国宇宙庁、Virgin Orbitから2千万ポンド以上を調達
 周辺産業振興による経済効果も見込む→ Increased supply of solid propellants→ Satellite transportation business, including
defense use, is becoming more active

Growth Policy• Ammonium perchlorate production facility expanded

 米国ニューメキシコ州が2億ドル以上を投資し建設した米国を代表するス
ペースポート Virgin Galacticの事業
拠点
 将来的には打ち上げサービス等から1億ドル~3億ドル/年程度の経済効果を見込む

Houston Spaceport• Propellant development products for commercial rockets

To develop new applications, such as for defense

スペースポート
開港予定Spaceport America→ Investment scale will be set flexibly→ Continue to study production methods

スペースポート
開港済 ヒューストン市のEllington空港を宇宙港として利用。投資資金は市の内部留保から捻出
 同空港にはプライベート
ジェットも多く離発着しており、富裕層ビジネスと宇宙ビジネスの連携可
能性も存在

日本の取り組み
 北海道大樹町にて北海道スペースポートが開港（2021年4月）
 和歌山県串本町では、ベンチャー企業のスペー
スワンが紀伊スペース
ポートの整備を進める 沖縄県下地島では宇宙
港事業推進に向けたコンソーシアム設立（2021年9月） 大分空港はVirgin Orbitとパートナーシップ締結。
2022年の衛星打ち上げを目指す

Source: Mizuho Bank Industry Research Division

Spaceports, which are landing and taking off points for spacecraft,are being opened in various countries, including Japan.

24

信 頼 と 限 り な き 挑 戦

2. Expansion of R&D
 Expansion of R&D system, mainly in the "chemical field"
2022-2024
Development
Policies
 R&D Resources Development of new long-life products through evolution of our coretechnologies
 Creating new high value-added materials through speedy development inresponse to change

R&D investment：0.5 billion yen/year
Development personnel：35
Important patent：41

 Value Creation
Profit Target：0.5 billion yen
Patent Application：30

PICK UP!

Constructed a new third large laboratory

SDGs related products, etc.
→Product development to meet future social needs

Plans to introduce additional large laboratories following
the first and second to increase the speed of scale-up
development.
25

信 頼 と 限 り な き 挑 戦

2. Expansion of R&D

 Forecasting from "core technology" and backcasting from "future state "We have created new products
But...
no new Carlit "pillar" businesses have been created to rival

 Chlorate  Signal Flares
 Electronic
Materials
Transform into an organization that creates new businesses
by returning to and deepening core technologies

The future to be realizedMore advanced electronic
devices such as cell phones• Creating more comfortable living
spacesRealization of High-Performance
Energy Storage Device Supporting
Lifestyles from Space and the Sky• Highly efficient use of H2 energy

Further promotion of clean
energy to achieve carbon
neutrality• Long-running electric vehicles• Robust bioplastic• Creating materials of the futureusing oxidation reactions• Renewable Energy Optimization

What future technologies
are we aiming for?
Unique Oxidation
Reaction Technology
Advanced electrolysis
with original electrodes
Synthesis technology tomeet the latest needs

Core technologies to be
explored in depth
Oxidation
Reaction
Technology

Electrode andElectrolysis
Ionic
Technology Compounds

Synthesis
Technology
26信 頼 と 限 り な き 挑 戦

2. Expansion of R&D

 Execute "engineering chain management" to create "new products" from core technologies
Our R&D Structure

Japan Carlit Co., Ltd.
• Integration of development, sales,and production divisions within thecore operating company• Development Division establishedto facilitate communication andinformation management

R&D Center
Development
Division
Sales Division

 Speeding up management decisions
 Creating innovation through revitalizedinterdepartmental communication

External Conditions
cooperative
company
Technology
TrendsMarketTrendsDevelopment Division Mission• Gathering and sharing informationinternally and externally• Consultation, negotiation andcoordination• Support for R&D theme exploration

Client Make accurate business decisions by supplementing
accurate customer needs and market trends

 Promote innovation creation by overseeing internaland external information

Speeding up "management decisions" and "innovation" to create new products27信 頼 と 限 り な き 挑 戦

3. Improving profitability of existing businesses
 Improvement of earnings in existing businesses→ Thorough financial discipline with
"Gross Profit" and "SG&A" as KPIs.
 Execute portfolio management with cost of capital in mind
Revenue Plan

Sales

FY2021 Actual

FY2024 goal

34 billion yen

37 billion yen

Operatingincome2.5 billion yen

ＲＯＥ

7％

Focus Areas

Develop Areas

Base Areas

Ideal Carlit
Group In 2030

3.0 billion yen

5.0 billion yen
or more8％

10%
or more28

3. Improving profitability of existing businesses

信 頼 と 限 り な き 挑 戦

Capital Investment Plan Equipment investment 9.0 billion yen planned (total for 3 years)
New and development equipment：30%
Investment in equipment
enhancement and renewal：70%

Investment in renewal and aging equipment ：55%
Energy- and labor-saving equipment：30%
Investment in labor environment improvement：15%

Focus
Areas
1.0

Develop
Areas
1.0

Base
Areas
5.5

billion yen

billion yen

billion yen

New and development equipment ：20%
Investment in renewal and aging equipment ：80%

DX
Promotion
1.5
billion yen

Mainly digital investment for DX
promotion, etc.

• In addition to investments in efficiency and manpower saving, investments that contribute to ESG and
BCP are also actively executed in the infrastructure area
• Flexible investment allocations for uncertain growth investments such as M&As and raw material
business for propulsion drugs are set separately from this table.

29Mid-Term Management Plan

Challenge 2024
Part 2

4.
Advancement of
ESG management

5.
Rebuilding ofbusiness
infrastructure30

Challenge 2024 Two strategies for ESG

信 頼 と 限 り な き 挑 戦

 Build strategies for each of the materialities listed. Also execute portfolio management
4.
Advancement of
ESG management
Approach to materiality related
to social contribution

5.
Rebuilding ofbusiness
infrastructure
Approach to materiality related
to business infrastructure31

4. Advancement of ESG management

信 頼 と 限 り な き 挑 戦

Climate Change Action

 Disclosure of climate change-related information in accordance with TCFD
 Analyzing and addressing climate risks and opportunities to enhance resilience
Strengthening ofpromotion andmanagement
systems
Calculation& Analysis• Strengthening sustainability promotion and management systems• Analyzing climate risks and opportunities to enhance resilience→ Quantitative disclosure and formulation of response measures• Improve the accuracy of GHG emissions analysis by introducing
calculation services→ Set GHG emission reduction targets for 2030 and 2050
• Establish a plan for transitioning to carbon neutrality

Action• Promote development and expansion of environmentally friendly
products and services• Promoting Sustainable Procurement• Promote internal enlightenment through training, etc.

32

4. Advancement of ESG management

信 頼 と 限 り な き 挑 戦

The challenge of becoming carbon neutrality

 GHG emissions reduction target

 Working toward carbon neutrality

FY 2030
FY 2050

Scope 1, 2

△46%（Scope1,2）
Transition plan in place to achieve carbon neutrality

Promote energy
savings and creation

Scope 3 reduction
target being set

Scope 3

Promote the use ofrenewable energy

Scope 1,2
▲ 46%

Scope 3

Scope 1,2
FY2013

FY2021

FY2021 target

Scope3

128,125

156,411in process ofsetting up

Scope1,2

54,38831,88829,370※ 7 group companies were surveyed
Carlit Holdings, Japan Carlit, Silicon Technology, JC Bottling,
Namitakiko, Toyo Spring Industrial, Fuji Shoji

FY2050targetCO2 emissions(tons)

Enhanced promotion
throughout the
supply chain•

Introduction of high-efficiency, energysaving equipment•

Improve production and business processes•

Promotion of energy recycling•

Carbon offset through afforestation•

Efficient Use of Hydroelectric Power Plant
Electricity•

Switch to renewable energy sources•

Expansion and expansion of solar power
generation facilities•

Promotion of Sustainable Procurement•

Improving transportation efficiency•

Contribution to energy saving through new
product development•

Promotion of 3R’s

33

4. Advancement of ESG management

信 頼 と 限 り な き 挑 戦

Connection to Society Creating a rewarding workplace for employees
 Promoting Diversity and Inclusion
Engagement

Human
Resource
Development
HealthManagement

KPI
Employee Engagement Survey to be
implemented from FY2022→ Continuous improvement of engagementscore (KPI to be set in the future)Improved engagement "employee-company bond"

Checking the relationship between employees and the company frommultiple perspectives to identify and improve issues



Foster a desire to make management decisions from a group management
perspective and to take on the challenge of creating new businesses



Execution of various training programs such as "Management", "Leadership",etc.

Human capital investment: 20% improvement
per person(Next generation management especiallystrengthened 25% increase)Focusing on improving the health of employees and theirfamilies, aiming for "Health and Productivity Management
Organization" certification in 3 years.

• 100% of employees receive periodical medical
examination• Smoking rate 5%Develop a work environment where diverse human resources canwork together in the same way (remote work, factory automation,etc.)

Ratio of female manager
FY2021 ：1.8%
FY2024 ：3% or more
FY2027 ：5% or morePromotion of women's activities

Diversity34

4. Advancement of ESG management

信 頼 と 限 り な き 挑 戦Communication with Stakeholders

 Promoting communication with stakeholders and providing value

For communication with stakeholders• Promoting active and proactive communication based on guidelines for Investor and Company Engagement• Continuation of financial results briefings and individual meetings• Publish integrated reports in accordance with a framework that meets investor needs• Organize small meetings on areas and products that are highly compatible with the SDGs and ESGs

Providing value to stakeholders• Dividend policy with an eye on stable returns→ Continue to target a consolidated dividend payout ratio of 20% to 30%.
35

5. Rebuilding of business infrastructure

信 頼 と 限 り な き 挑 戦

Clarification of Financial Policies

 Aggressive investment in growth is a top priority⇒Not only equipment investment, but also M&A investment will be considered.
 Clarify financial policy and aim for optimal balance between investment and shareholder returns• Borrowings• Sale of stock
holdings

Growth and M&A
investment＝Flexible
investment
allocation

 Growth and M&A investment
Flexible allocation of growth investments to focus/develop
areas〇Considering business alliances and M&A to strengthen
Shareholder's dividend ……...market and technology competitivenessOperating CashFlow
11 billion yen〇Investments to strengthen the raw materials for propulsion……...business…………………………………………………………………………………
Equipment
investment, etc.
9 billion yen

Finance Shareholder's dividend
Target dividend payout : 20%-30%

Management365. Rebuilding of business infrastructure

信 頼 と 限 り な き 挑 戦

DX Promotion

 Accelerate digital investments to speed up management decisions
 Strengthen cyber security measures to prepare for increasingly sophisticated and complex cyber attacks
MeasureManagement
andAdministration

Sales• Business Decisions and Risk
Management• Accounting, Finance, Human Resources Expansion of telework, promotion of
paperless office• Customer information and needs• Credit information

 Advanced Cyber Security

 Cloud computing, optimization of IT
tools Breaking away from legacy systems

Manufacture• Manufacture Information• Equipment Management

R&D• Experimental data
• Latest Technology Trends

Digital investments consolidate and link informationfrom various departments

Outputs
 Speeding up management
 Advanced risk management
 Understanding the latest external
environment
 Improved efficiency of manufacture,procurement, and inventory
 Promoting the creation of new ideas37信 頼 と 限 り な き 挑 戦

Finally To realize our "Vision for 2030" we are pursuing the following strategies
Management
PolicyChallenge 2024
5 Strategies

Aiming to increase corporate value
by optimizing the business portfolio

Part 1Strategy execution through PDCA cycle→ Plan to proceed while reviewing

1.
2.
Accelerate growth Expansion of R&D
businesses

Part 2

4.
Advancement of
ESG management

3.
Improvingprofitability ofexisting businesses

5.
Rebuilding ofbusiness
infrastructure38信頼と限りなき挑戦
Earning Trust and Tackling Countless Challenges

無限の可能性をカタチにGiving Shape to Infinite Possibilities39信 頼 と 限 り な き 挑 戦

 The forward-looking statements about the Carlit Holdings Group's performance contained in this document are based on
certain assumptions that we believe to be reasonable at the present time. Therefore, actual results may differ materially fromthe forward-looking statements.
 The following is a list of the main factors that may affect the Company's performance, but new factors may arise.
①

Global economic and social conditions and trends in regulations, taxation, and other laws and regulations②

Rate of exchange③

Stock quotation④

Product supply-demand situation and parts procurement environment⑤

Financing environment⑥

Granting and licensing of important patents and patent-related disputes, etc.

⑦

Regulations and issues related to the environment⑧

Defects in products or services, etc.

⑨

Litigation and other legal proceedings⑩

Rapid technological changes and the timing of development, manufacturing, and market launch of products using new technologies⑪

Business restructuring⑫

Information Security⑬

Major disaster⑭

Social and political turmoil due to terrorism, war, infectious disease epidemics, etc.

⑮

Important matters concerning directors, major shareholders, affiliates, etc. of the company
40