JFE Holdings, Inc.
3Q Financial Results Briefing for the Fiscal Year Ending March 2023
February 6, 2023

Presentation
Moderator: Ladies and gentlemen, thank you for your patience. We would like to begin JFE Holdings, Inc.’s
Investors Meeting.
In attendance today is Masashi Terahata, Representative Director, Executive Vice President.
Terahata: Thank you.
Moderator: Toshihiro Tanaka, Senior Vice President.
Tanaka: Thank you.
Moderator: Well then, regarding the financial results announced today, Executive Vice President Terahata
will first explain the main points of the announcement.

Terahata: I’m Terahata. We have key points of today’s announcement here.
The business profit for the 3Q cumulative period was JPY231 billion. The FY2022 forecast for business profit
is JPY235 billion, a downward revision of JPY20 billion from the previous forecast.

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In particular, due to the deteriorating environment in 3Q and 4Q, we expect demand for steel products to beeven lower than our previous forecast due to stagnant activity and reluctance to buy in the domestic market,
as well as the delayed recovery of market conditions in overseas markets.
Despite this environment, we have maintained our focus on selling prices. As a result, crude steel production
has decreased from the previous forecast, and is now projected at 24 million tons per year, about 1 million
tons lower than the previous forecast.
Due to a decrease in crude steel production, we have revised downward our forecast for the steel businessby JPY15 billion to JPY150 billion. However, due to efforts to improve sales prices, the spread improvement
has progressed further than the previous forecast.
In the engineering business, we have revised our forecast downward, partly because we have posted losses
on separate construction projects in Europe. The current forecast has been lowered by JPY7 billion from theprevious forecast to JPY13 billion.
For the trading business, we expect a record high of JPY60 billion, which is in line with our previous forecast.
In the above manner, profit attributable to owners of parent was JPY150 billion, a decrease of JPY5 billion
from the previous announcement, and the annual dividend was set at JPY80, taking into consideration adividend payout ratio of 30%. Since we have already paid an interim dividend of JPY50, we plan to propose ayear-end dividend of JPY30 to the general meeting of shareholders.
Today, we also issued a press release regarding our consideration of capacity expansion of non-oriented
electrical steel sheets, which will be explained later.
That is all from me.
Moderator: Now, Senior Vice President Tanaka will explain the details of the financial results and forecast.
We will have a question-and-answer session after the briefing.

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Tanaka: I am Tanaka. I will now explain the results and forecast based on the materials. First, I would like topresent the 3Q financial results and outlook for the JFE Group as a whole.
Here are the financial results for 3Q.
Inside the blue line are the results for this fiscal year. The results include revenue of JPY3,908.5 billion,
business profit of JPY231 billion, segment profit of JPY220 billion, and profit attributable to owners of parentof JPY143.9 billion.
Cumulative business profit for the entire JFE Group is JPY231 billion. Compared to the same period last year,
profit decreased by JPY91.8 billion.

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On the next page is a table itemized by segment.
The upper row shows revenue, and the lower row shows segment profit. Looking at segment income, thesteel business had JPY170 billion, the engineering business had minus JPY2.1 billion, and the trading business
had JPY55.7 billion, for a total result of JPY220 billion.

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Next, the forecast for FY2022.
As mentioned at the beginning of this report, the annual forecast is JPY235 billion in business profit, a decreaseof JPY20 billion from the previous forecast and a decrease of JPY181.4 billion from the previous year.
In the blue line below are the figures for this forecast. For the year, we are projecting revenue of JPY5.2 trillion,
business profit of JPY235 billion, segment profit of JPY220 billion, and profit attributable to owners of parentof JPY150 billion.

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The next page contains a table similarly itemized by segment.
JPY150 billion for the steel business, JPY13 billion for the engineering business, and JPY60 billion for the
trading business. Compared to the previous forecast, the steel business will see a JPY15 billion decrease inprofit and the engineering business will see a JPY7 billion decrease.
These are the numbers.

6First, we will discuss the overall sense of steel supply, demand, and production for steel.
This time, due to the postponement of domestic demand in the housing and civil engineering and construction
sectors and the continued softening of overseas demand and market conditions, JFE Steel’s standalone crude
steel production is expected to be approximately 24 million tons, a decrease of 1 million tons from theprevious year.
In the previous announcement in November 2022, we also said that production would be reduced by 1 million
tons compared to the August 2022 announcement, and the table below rearranges these figures. The left is
the announcement as of August 2022, the middle is the announcement as of November 2022, and the rightis the current announcement.
As of August, our perception of the sales environment was that parts supply constraints in the domestic
automotive sector would gradually be resolved. Furthermore, overseas, domestic demand in China wassluggish due to their zero-COVID-19 policy, but we expected both overseas demand and market conditions torecover toward 2H of the year due to economic stimulus measures.
The metal spread shown in the middle of the graph is also expected to improve from 2H of the year, and JFE
Steel’s standalone crude steel production volume for 2H of the year is expected to be slightly less than 6.5
million tons per quarter.
As of November, the recovery in the level of activity in the automotive sector in Japan was slower thanpreviously assumed, as well as the sluggish Chinese economy and construction demand in emerging countries
was also postponed. Around this time, the Communist Party Congress was held in China, and there were7

expectations that various measures would come out. However, since there were no significant economic
measures, demand for steel products, spreads, and market conditions did not recover much in 3Q, and we
expected the recovery to shift to 4Q.
As a result, for the crude steel volume at the bottom, we had expected a 1 million ton reduction in production
mainly in the current 2Q, and in 3Q.
In this time, the demand is postponed, especially in the domestic housing and civil engineering andconstruction sectors and overseas demand for steel products and market conditions are not showing signs ofrecovery in 4Q due to the uncertain outlook for the overseas economy. Therefore, the annual production is
expected to be about 24 million tons, including a further 1 million tons of production cut in 3Q and 4Q.
The quantities are as described above.

I would like to discuss our most recent efforts to improve sales prices.
In 2H of this fiscal year, the demand for steel products has been sluggish, and overseas market conditions andkey raw materials cost have been very weak.
First, please look at the graph on the left. The blue line shows the change in JFE sales prices. The 1H average
was JPY131,600. This graph is dotted quarterly, with peaks in 2Q and 3Q, and we expect the sales price itself
to decline in 2H of the year through 4Q. We estimate that the average for 2H of the year will be about
JPY130,000.

8On the other hand, looking at the red line below, the price of main raw materials has been decreasing every
quarter since 1Q, so the spread between the blue line and the red line, the so-called spread between sales
price and key raw materials, has been increasing with each passing quarter. This means that we are achieving
spread improvement.
Specifically, as mentioned in the upper section, we are working to improve selling prices by shifting various
prices, overhauling extras, and Improving to sustainable level.
In terms of figures, we have factored in a JPY87 billion improvement in the spread for 2H of the year comparedto 1H, and a JPY28 billion improvement compared to the previous announcement. This spread improvementtakes into account not only the difference from the key raw materials shown in the table below, but also theimpact of foreign exchange effect, higher energy costs, and other costs. We assess that spread improvement
is progressing steadily.

The next section is a summary of how the ability profit/loss is performing in the current very difficult
environment.
The left-hand side of the bottom row shows changes in overseas metal spread trend, which are in fact very
low in this FY2022 compared to the past, especially through 2H of the year. Furthermore, the current crude
steel production has also declined considerably. The lower graph on the right side of this page roughly
illustrates the movement over the past two years, 2H of 2020, which is the starting point of our seventh midterm plan, and 2H of 2022.

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In 2H of 2020, the actual profit/loss, excluding one-time items, is JPY3,300 per ton. The assumption at thattime was that the metal spread for hot rolled coil on a spot basis in China was USD342. Also, the standalone
crude steel production at that time was 12.59 million tons.
On the other hand, the level in 2H of 2022 is about USD160 in metal spread and 11.4 million tons in crude
steel production, which is a worsening environment when these two major items are taken out.
If we translate these two factors into an impact per ton, which is illustrated by the arrow pointing downward
in this red graph, we see a deterioration of about JPY8,000 per ton. In other words, if this deteriorating
environment was added to the same condition as in 2H of 2020, it was not surprising that the Company’s
actual profit/loss could have fallen into the red.
On the other hand, mainly in Japan, we achieved an improvement of JPY9,000 per ton through the spread
improvement and price improvement efforts I mentioned earlier, and our actual profit/loss for 2H of this year
was JPY4,200 per ton, which is rather better than 2H of 2020.
We believe that we are making progress in building a stable and profitable business structure that is notdependent on overseas market conditions or volume.

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Finally, I will explain dividends.
As mentioned at the beginning of this report, the year-end dividend is proposed to be JPY30 per share, for anannual dividend of JPY80 per share. The dividend payout ratio is shown in the column for FY2022 on the far
right, which is 30.9%.

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Next, here are the details by company.
First, JFE Steel. As always, we are organizing our various sources, including financial forecasts and actual
results.
Regarding segment profit, the current 4Q forecast is a loss of JPY20 billion, compared to the 3Q results of
JPY21.8 billion.
On the other hand, if you look at the figures below, excluding inventory valuation etc., one of the key points
is that the actual profit/loss remained basically unchanged in 3Q and 4Q, with JPY22.8 billion in 3Q and JPY22
billion in 4Q.
Below you will find assumptions for crude steel production, steel export ratio, average prices, exchange rates,
etc.

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Based on this premise, let me first explain the breakdown of profit/loss changes from the previous fiscal year
for the cumulative 3Q results.
The previous fiscal year was JPY252 billion, and the current fiscal year is JPY170 billion, so the decrease is
JPY82 billion.
The cost is plus JPY5 billion, and the volume is minus JPY18 billion because crude steel production has
decreased by about 1 million tons from the previous year.
Regarding the spread in the third item, sales price and raw materials, the cost of coking coal, in particular, has
increased significantly during this period, but the large improvement in sales prices, mainly in Japan, hasresulted in a large positive figure.
As for exchange rates, the yen has depreciated significantly, resulting in a negative difference in exchange
flows, and as mentioned in the others section, energy unit prices have also increased, which is also in thenegative direction, but even when all these various prices are added together, the spread has improved
significantly.
On the other hand, the fifth item, inventory valuation, had a significant negative impact compared to last year,and group companies also saw a decrease in profit, mainly overseas group companies, resulting in a decreaseof JPY82 billion in profit.

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Looking at the annual outlook, the following is a more detailed look at the current domestic and overseas
business environment by sector.
In Japan, as I mentioned at the beginning of this report, there is a postponement of demand in the residential
and civil engineering construction sectors, and a slowdown in orders due to the slowdown in overseas
economies.
However, in the auto sector, we believe that the level of activity is improving, albeit slightly behind that of theprevious period.
On the right, trends by sector, including the auto sector, are listed. In shipbuilding, we expect a certain amountof contract backlog to be secured and continue to be stable, and in other manufacturing sectors, we expect
the level of activity in construction machinery to be firm, although there will be a slight slowdown in orders
for industrial machinery due to the slowdown in overseas economies. The left side of the chart shows thepercentage change in domestic ordinary steel consumption forecast from the previous year. For the
manufacturing sector, 3Q and 4Q show that consumption remained at the same level as the previous year.
On the other hand, it is the field of construction and civil engineering. As for construction, large projects arefirm, but small and medium-sized projects remain sluggish. As for residential properties, the number ofhousing starts has been sluggish due to soaring material prices. In the case of civil engineering, delays of bit
solicitation have become very apparent due to the rising cost of materials, and the steel consumption forecaston the left side of the graph has become more negative in the 3Q and 4Q.

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Next is the overseas business environment.
With weak domestic demand in China and the outlook uncertain in Europe and the US due to the economic
slowdowns, overseas demand for steel products is currently weak and inventory adjustments were seen.
Looking ahead, we expect that the supply-demand balance for steel products and market conditions will
improve due to the economy recovery with a round of inventory adjustment, China's lifting of the zero-COVID
policy and support measures for the real estate sector.
The graph on the lower left shows the HRC price in the Chinese steel market, and there have been signs of a
recent reversal. We will have to wait and see whether the economy will recover in earnest after the Chinese
New Year, but I think we are beginning to see a direction of improvement.
On the right side, the real GDP growth forecast for 2023, which is the IMF’s forecast, has just been revised ina slightly more positive direction than before, even most recently.
In any case, demand is generally sluggish in the thin sheet field, and the key point will be whether it recovers
in the future.

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Next, let us look at trends in the raw materials market.
Iron ore bottomed out at the end of October last year and is now on an upward trend due to expectations ofa recovery in demand for steel products as a result of the easing of China’s zero-COVID-19 policy.
On the other hand, coking coal prices have fallen from recent peaks, but remain in a high range.
There have been reduced supplies due to weather and the partial lifting of import restrictions on Australiancoal in China, and we will have to keep a close eye on the impact of these factors.

16Based on the above assumptions, this is the change in segment profit for steel.
First, here is a breakdown of the JPY15 billion decrease in profit versus the previous forecast. First of all, we
have factored in a negative JPY10 billion cost increase due to the impact of a very large production cut in the
short term, which will result in an increase in costs.
In addition, volume decreased by 1 million tons, resulting in a negative JPY20 billion. As a result, theproduction cut has resulted in a decrease in profit of about JPY30 billion.
On the other hand, regarding the spread in the third item, we are continuing our efforts to improve the priceby passing on the cost to the selling price, and the spread will improve by JPY20 billion compared to the lasttime.
Furthermore, the foreign exchange effects on trade are also positive because the yen is slightly appreciating.
However, as noted in the fifth item, inventory valuation, the foreign exchange valuation is negative when the
yen swings toward appreciation, so in this phase, this is offset by the foreign exchange effects on trade andthe foreign exchange valuation.
Others include group companies and negative energy unit costs. Although further progress has been made in
improving spreads, the revised profit decline is JPY15 billion due to the impact of volume and other factors.

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Next is a comparison with the previous fiscal year.
Compared to the previous fiscal year, profit decreased significantly by JPY173.7 billion. As for volume and mix,
crude steel production is significantly lower than the previous fiscal year and is negative by JPY30 billion, but
we have factored in a very large positive spread of JPY220 billion.
The spread has been steadily improving and widening even after taking into account various prices such as
foreign exchange effects on trade and energy unit prices.
However, compared to the previous year, the negative impact of inventory valuation had a very large impact,
and there was also a decrease in profits at other group companies and overseas group companies. Accordingly,
compared to the previous fiscal year, the numbers are as shown.

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Then there is the change between 1H and 2H of the year.
The 1H figure of JPY148.2 billion was reduced to JPY1.8 billion in 2H, a decrease of JPY146.4 billion, which is avery large decrease in terms of numbers. However, if you look at the profit excluding inventory valuation
below it, it is rather higher in 2H of the fiscal year in terms of actual profit and has improved.
There is a huge gap between segment profit and actual profit. This is due in part to the negative impact of theinventory valuation, carryover, and foreign exchange valuation in the fourth item. Although this is a small
figure for 2H of the fiscal year as a result of the profit and loss, the actual profit and loss is up due to theimprovement of the spread.

19Based on the explanations given so far, the following is a summary of how the current 2H performance
forecast stands in the seventh mid-term management plan.
In 2H of FY2022, the actual profit/loss is about JPY45 billion, excluding the valuation difference I mentioned
earlier. If we double that amount plus the return of the impact of the blast furnace renovation in Chiba, it will
be about JPY110 billion. This will be the starting point for cost reductions of JPY75 billion, including JPY45
billion for structural reforms, and for volume, since the annualized volume for 2H of this fiscal year will be at
the 23 million ton level, it would not be surprising to see a positive figure of about JPY80 billion, including
JPY20 billion from the return of production cost reductions, when viewed under the medium-term assumptionof 26 million tons. If the volume returns to 26 million tons, the total accumulated amount up to this point will
be JPY265 billion, a level that exceeds the mid-term target of JPY230 billion.
Furthermore, since the export market is in a very bad condition in 2H of this fiscal year, we recognize that we
can aim even higher with the recovery of the market and the added value of various other measures.

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About the engineering business.
While orders and sales remain unchanged from the previous forecast, profit is expected to decrease by JPY7
billion to JPY13 billion, as mentioned at the beginning of this report.
The reason for this decrease in profit is that losses were recorded at Standardkessel, a subsidiary in Germany,
which is described as European construction projects.
As indicated in the compared to the previous forecast column below, the factors are that the cost of several
projects in Europe has increased significantly due to the prolonged situation in Ukraine, which has resulted ina shortage of materials and equipment, as well as a shortage of workers.
We have seen these factors since the previous forecast , but the impact is even more widespread than theprevious forecast.
In addition, we are negotiating with our customers to obtain additional costs for these cost increases, but due
to the prolonged situation, these negotiations are not progressing well, and some of the additional costs will
not be obtained until the next fiscal year or later, resulting in the large downward revision to the forecast.

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Next is JFE Shoji, trading business.
This is unchanged from the previous forecast of JPY60 billion. We anticipate a record high profit, with anincrease of JPY4.1 billion YoY.

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Finally, I will explain the topics.
This is about our consideration of capacity expansion of manufacturing facilities for non-oriented electricalsteel sheets, which was introduced at the beginning of this presentation.
The electrification of automobiles is accelerating as environmental regulations are being tightened worldwide,and demand for high-grade non-oriented electrical steel sheets for the main engine motors of electric vehicles,
so-called N/O, is expected to grow rapidly, resulting in a tight supply-demand balance.
The bottom left shows the regulations for automobiles and the movement toward electrification in various
countries around the world. As shown in the upper left-hand corner, in Europe, sales of gasoline-powered
vehicles will be banned in EU member countries by 2035, and in the United States, the goal is to achieve a
50% electric vehicle ratio by 2030.
In China, the sales ratio of new energy vehicles is expected to exceed 20% by 2025, and it appears that thecurrent sales ratio is already higher than this, indicating that the electrification trend is accelerating.
As shown in the global demand forecast for electric vehicles in the upper right-hand corner, the green line in
the latest forecast shows that demand is expected to increase at an even faster pace than the line below it,which is the forecast and projection as of 2020. In response to this, we have included N/O’s global
supply/demand forecast at the bottom of this section.

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This is our estimate, but if demand is set at 1 in 2020, it is expected to increase 5-fold by 2025 and 10-fold by2030, which means that the room for production increase and the gap between supply and demand will widen
significantly.

In response to these prospects and increased demand, we are considering further capacity expansion of N/O.
Specifically, as indicated as February 2023 release in the red box at the bottom of the left-hand side, we will
make an additional investment of JPY50 billion to triple the capacity of the top grade N/O of so-called electricvehicle main motors by the end of FY2026 compared to the current capacity.
Above this, you can see release as of April 2021, which has already been announced. Construction work is
now underway at a cost of JPY49 billion, and the facilities are to be operational in 1H of FY2024. At this stage,
we said that we would double the supply capacity of so-called high-grade N/O compared to the current level,
but the investment we are considering is to further increase this capacity to three times the current level.
The right-hand side of the page describes the aim of the main engine motors of electric vehicles and our
response to it. Now, automakers are seeking higher efficiency to improve electric costs, which will contributeto increased cruising distance and reduced battery use. They are also seeking higher high-speed rotation andhigh power, which means that there is a greater need for smaller and lighter products.
As written below, low iron loss, high magnetic flux density, high strength, and non-oriented electrical steel
sheets are required to achieve these goals, but there are actually some challenges in achieving all.

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We will strive to develop and market what we call top grade N/O that achieves these conflicting requirements
at a high level by applying our proprietary technologies.

This is the last page. The DX report was recently released.
We are pleased to introduce that we have issued a DX report for 2022 as well.
That is all from me.
[END]

This document does not purport to address the requirements of the Financial Instruments and Exchange Act. It
is the responsibility of the user of this document to determine the correctness and integrity of the informationin regard to its use. The forecasts presented are prepared on the basis of information available at the time of thebriefing session and include uncertain factors. It is strongly recommended NOT to rely only on the forecasts inthis document when making investment decisions. In no respect will JFE Holdings, Inc. incur any liability forany damage arising out of, resulting from, or in any way connected to the use of the information contained
herein.

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