Pigeon Corporation Third Quarter Fiscal Year December 31, 2023 Financial Results Conference CallSummary

Summary of the Financial Results Conference Call for Q3 FY Dec. 2023
Note: This Summary is a reference for those who would like to review the session or event of
the results briefing held by Pigeon Corporation.

Please note this is not the entire text of the conference but a summary based on our judgment.
Forward-looking statements in these materials are based on management's assumptions andbeliefs in light of the information currently available to it and involve known and unknown

risks, uncertainties and other factors. Such risks, uncertainties and other factors may affect theCompany's performance.

In the event of discrepancy between the English version and the Japanese version of thesummaries, the Japanese-language version shall prevail.

[Date & Time]

Wednesday, November 8, 2023 18:00 - 19:00[Speakers]

2 speakers

Yasuo Kanatsuka
Sho Hiratsuka

Manager, Business Strategy Department

Associate Manager, Business Strategy Department

The consolidated results for the first nine months of the year (3Q) ended with an increase inrevenue and profit, driven by the Japan business, the China business and the Lansinoh

business. Sales amounted to 72,942 million yen, an increase of 3.2% over the previous year,approximately 2.2 billion yen.

Gross profit amounted to JPY 35,925 million, an increase of 8.2%, approximately JPY 2.7 billion
compared to the previous year.

Operating income was 10.1 billion yen, up 11.9% or about 1 billion yen from the previous year.
The operating profit margin also improved by 1.1 percentage points.

Ordinary income and net income also ended the period higher than the previous year.

1This is the reason for the increase or decrease in consolidated operating income in the 3Q
cumulative period.

SG&A expenses for the cumulative 3Q increased by 1.64 billion yen from the previous year, due
to the progress of the carry-over from the first half of the year.

On the other hand, cumulative operating income increased by 1.08 billion yen from theprevious year, thanks also to increased revenue and improved gross margin.

However, as of the end of the 3Q, some of the sales promotion expenses were stillunaccounted for against the internal plan, and these expenses are scheduled to be incurred in
the 4th quarter (4Q).

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This is profit/loss by business segment for the cumulative 3Q period.

Cumulative sales increased y-o-y in all three businesses except the Singapore business. Inaddition, both gross profit amount and gross profit margin increased y-o-y in the threebusinesses, excluding the Singapore business.

The improvement in gross margin was mainly due to contributions from product pricerevisions in the Japan business, an improved product mix in the China business due to anincreased sales mix of baby bottles and nipples, and lower ocean freight costs in the Lansinohbusiness.

As for cumulative segment profit, both segment profit amount and profit margin increased y-oy in the three businesses except for the Singapore business.

3This is a summary by business segment for the cumulative 3Q.

The performance of the Japan business grew mainly in core products. Also, core products
remained strong even after the price revision in February, resulting in increased sales andprofit.

Sales of baby care products were solid, up 4.0% from the previous fiscal year. Cumulative salesof baby bottles and nipples and skincare products increased from the previous fiscal year.
Sales of wet wipes and other consumables were also strong.

New products include the electric nasal aspirator SHUPOT, straws and lids for Bonyu Jikkan

parts, etc., which have been on sale since August.

With regard to inbound sales, although the number of foreign visitors to Japan is on the rise,inbound demand to the Company remains sluggish.

The gross profit margin for Baby Care improved 2.3 percentage points y-o-y on a cumulativebasis, with the price revision in February making a significant contribution. As announced inour recent release, we have once again implemented price revisions for baby care products
and health care/nursing care products in September, following the February price revision.

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The China business also ended the year with increased revenues and profits.

Mainland China sales in the 3Q alone (July-September) were -8.4% y-o-y on a local currency

basis, partly due to prior shipments to Double Eleven (and partly due to growth in the previous
period after the lockdown). Year-to-date sales (sell-in) ended at almost the same level as theprevious quarter.

Cumulative sales of baby bottles and nipples were up 27% from the previous quarter. Babyskincare category was down 11% from the previous quarter. In particular, we see the 3Q alone
as a significant headwind for Japanese brands in skin care products due to the release oftreated water.

New products include the natural weaning series, which is currently the focus of the Age-Up

product line, and skincare for kids, both of which are expanding sales both offline and throughe-commerce.

The cumulative gross profit margin of the China business improved by 3.5 percentage points

from the previous year, partly due to an increase in the sales composition of baby bottle andnipple products.

Meanwhile, sellout in mainland China ended the quarter at -6% y-o-y on a cumulative basis. Bychannel, e-commerce remained almost on par with the previous quarter, while offline

remained sluggish at -18% y-o-y. However, sell-outs from newly focused channels such as

TikTok and Pinduoduo continued to grow with double-digit growth over the previous quarter.
The ratio of e-commerce to total sales in the 3Q was 72%.

5The Singapore business continued to experience a reactionary decline from the previous year's

sell-in growth in major countries from the 2Q, and ended the 3Q accumulation with lower sales
and income. On the other hand, expenses are ahead of schedule for sellout growth in eachcountry.

Cumulative year-to-date sales y-o-y for each country in the Singapore business were -21% inIndia, -9% in Malaysia, -8% in Indonesia, and -20% in the Middle East.

Year-to-date sellout increased from the previous year, especially in India, Australia, andThailand, where baby bottles and nipples are performing well.

New product launches included additional designs for baby bottles and renewed models ofbreast pumps. The Singapore business continued to strengthen sales of its core products, babybottles and nipples, and skincare products, while Natural Botanical skincare strengthened
brand recognition in both e-commerce and offline stores in each country, and sell-out isgradually increasing.

The cumulative gross profit margin of the Singapore business deteriorated by -3.2 percentage
points from the previous year due to lower sales at sales companies and plants.

In the Lansinoh business, while sales in North America fell below the previous year's level inthe cumulative 3Q, sales in Europe and China grew. In addition, lower ocean freight rates
contributed to improved profit margins.

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Lansinoh Group's sales in local currency terms ended the year with a y-o-y increase of 2% on acumulative basis. Sales in North America were down 4% from the previous year due tointensified competition in the consumables market and a reactionary decline from the special

demand that occurred last year. On the other hand, sales in Europe, including Germany, UK,and France, grew mainly due to nipple cream, a core product.

Cumulative sales of prenatal and postpartum care, which we are working on as a newcategory, grew by double digits compared to the previous year. Sales continue to be strong not

only in North America, but also in the UK, Germany, Benelux, and other markets.

The new product, Wearable Breast Pump, was launched in August at one major North

American discount store. As a result, cumulative sales in the breast pump category are also ona recovery track, albeit gradually.

The cumulative gross profit margin improved by plus 2.9 percentage points from the previousyear, partly due to lower ocean freight rates. On the other hand, sales and logistics costs (afactor of SG&A expenses) in the U.S. continued to soar.

These are summaries by business.

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Please refer to pages 8 through 10 for the year-to-date sales figures of Pigeon and Lansinohbrands on a local currency basis for each of their major markets, as well as their e-commerce

ratios.

89Finally, I would like to discuss the outlook for full-year results.

There is no change in our full-year earnings forecast for the current fiscal year from theforecast announced at the beginning of the period. While the Japan and Lansinoh businesses
are performing well, there is a growing sense of uncertainty in the Chinese market at themoment, and the Singapore business needs to strengthen its response to the recovery inbusiness performance.

Under these circumstances, in the 4Q alone, we plan to spend on additional measures toaccelerate growth in each business and to strengthen activities for sustainable growth in thenext FY 2024 and beyond. Therefore, we will first continue to focus on achieving this initialplan.

This is a summary of the financial results for the third quarter.

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Questions and Answers*Questions and answers are listed by business category.
Whole

Q. What was the impact of foreign exchange rates on consolidated results in the first
three quarters?

A. In the cumulative 3Q, there was a positive impact of approximately 1.5 billion yen on

consolidated net sales, approximately 700 million yen on gross profit, and over 100 million yen
on ordinary income compared to the previous year's exchange rate.

Q. How did consolidated sales and profit progress against your internal plan in the 3Q
non-consolidated and year-to-date?

A. Looking at the 3Q consolidated results (July-September), sales in Japan were in line with theplan, and Lansinoh's sales were slightly above the plan, including the effect of foreignexchange rates, but sales in China (including Korea) and the Singapore business, which has

been undergoing a reactionary downward adjustment since 2Q, were below the plan. Grossprofit was almost in line with the plan due to an improved mix of products sold, while SG&A
expenses were partially carried over from 1H and were eliminated in 3Q alone, resulting inoperating profit slightly below the plan.

In the cumulative 3Q, consolidated net sales were slightly below the internal plan, but grossprofit was almost in line with the plan. SG&A expenses were still several hundred million yen
higher than planned, partly because several hundred million yen of the carry-over from 1H
remained unaccounted for, and as a result, operating income exceeded the plan.
Q. How likely are you to achieve your full-year forecasts?

A. Considering the situation in mainland China through 3Q and the Singapore business, which

continues to adjust from the previous year's growth, we believe there is a possibility that

consolidated net sales may not reach the 100 billion-yen mark in the full-year plan. In addition,although consolidated gross margin and operating income at the end of the 3Q were higher
than our internal estimates at the beginning of the period, we are not optimistic about theprofit margin. In the non-consolidated 4Q (Oct-Dec), it is necessary to actively invest SG&A

expenses in sell-out leverage measures and further growth measures in each business, so wewill continue to invest expenses in a balanced manner to achieve consolidated operating profit
for the full year (JPY 12.4 billion).

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[Japan Business]

Q. The number of foreign visitors to Japan is recovering, and is Pigeon's inbound demandon a recovery trend?

A. As far as inbound store sales, which are regularly monitored by the Company, remained flaty-o-y in the cumulative 3Q. In addition, due to the release of ALPS treated water in the 3Q
alone (July-September), overseas demand, especially for Momonoha skincare and otherproducts outside the Company's jurisdiction such as cross-border e-commerce, also appears

to be sluggish.

[China Business]

Q. How did the 3Q stand-alone (July-September) sellout EC channel compare to theprevious quarter?

A. Overall 3Q stand-alone sellout, including EC and offline, ended at -12% y-o-y. Of this, EC was

down 8% y-o-y. While existing major EC sellouts declined YoY, focused channels such as TikTokcontinued to grow at a high rate YoY, although the composition ratio is still small.

Q. Based on the sell-in and sell-out in mainland China in the cumulative 3Q, what is theoutlook for the 4Q?

A. In sellout, EC had been growing y-o-y through 1H, but in 3Q, it was below the previous year'slevel. On the other hand, sell-in in the 3Q alone (July-September) was partially affected by therelease of treated water, but the cumulative total remained on par with the previous year due
to shipments of new baby bottles and more advance shipments for the double-eleven sales
season in November than in previous years.

The Company had expected continued growth in EC sellout in the 3Q and beyond, but actual

sellout was sluggish in some areas. In the 4Q, the Company will consider adjusting sell-in andimplementing additional measures to stimulate sellout while monitoring the distribution

inventory situation.

Q. Please tell us about the impact of the ALPS treated water release and the prospects forconvergence.

A. Immediately after the release of ALPS treated water in August, there was a temporary

increase in the number of inquiries from mainland Chinese customers to our company, but this12

number has now subsided. In our business activities, marketing activities were also severelyrestricted, as the planned Key Opinion Leader promotion became difficult, etc. We expect that

there was a certain amount of decrease in brand exposure and sales due to this, but we areunable to calculate the impact of this in quantitative terms. In addition, as far as the current

market reaction is concerned, the country of origin is not so important, and there is a tendency
to avoid Japanese branded products in all consumer goods.

Q. What is the response to the new "Natural Weaning Series" launched in June?

A. Shipments of the natural weaning series are progressing as initially expected, and theresponse from customers has been positive. We expect that this series will contribute tofurther expansion of our market share of baby bottle and nipple products. However, it isdifficult to see the contribution of the series, perhaps due to the avoidance of Japanese brands
due to the impact of the release of treated water. However, since we will have a salesexpansion system in place from 4Q, we will continue to focus on sales as one of our new areasof business and hope to increase our market share of baby feeding bottles and nipples inmainland China.

[Singapore Business]

Q. Please tell us about the status of distribution inventory adjustment and sellout
recovery in major countries.

A. Although sellout is recovering in the Middle East, Indonesia, Malaysia, and other markets, it
has not yet exceeded the level of the previous year. We have been able to gradually reduce
distribution inventories by focusing on increasing sellout while controlling sell-in from ourcompany. Although the pace of reduction is slower than we had expected, we will continue ourefforts to achieve inventory normalization in major countries by the end of FY2023.
[Lansinoh Business]

Q. Do you think the profitability improvement effect of lower ocean freight rates issustainable?

A. Assuming that the level of ocean freight rates will remain at the current level, we expect theeffect to continue until around the first half of next year.

[END]

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