(No explanation)

We were founded in 1930 with the domestic production of valve cores, and this year we celebrated our 90thanniversary. We now have the largest share of the global market for valve cores and tire valves.
We have produced and sold products, as shown here, in the Stamping and Molding Business, which consistsof stamping products and molding products; and the Valve Business, which consists of valve products andTPMS products.

Our Group operates eight domestic plants in the Chubu, Kyushu, and Tohoku areas. For overseas, with theacquisition of Schrader in 2018, we are expanding our business in eight countries, including France and theUnited Kingdom. The number of consolidated subsidiaries is currently 18.
I would like to report on some of the changes we have made to our Group companies, like business integrationin Thailand. On November 2, 2020, we will integrate the Valve and Molding Businesses established in 1990
and the Stamping and Molding Businesses, which began operations in 2018, with the aim of improving
management efficiency.
There is no impact on consolidated results due to this integration.

I would like to explain the state of management in the coronavirus crisis. As I mentioned earlier in May, we
have emphasized efforts to deepen the bonds between employees and their families by thoroughly
preventing infections, working closely with local communities while implementing global measures.
At the same time, we saw this opportunity, and in addition to thoroughly reducing costs, we utilized web
conferencing and other methods to change the way we work and use time, and increased the speed to solidify
our foundations and improve profitability.
With regard to our production system, we follow customer production fluctuations by maintaining
employment and supply chains on a global basis.
In addition to these achievements, production and sales volumes recovered. As a result, we were able torecover the deficit in the first quarter in the second quarter.
We will continue to prevent infections and maintain production systems on a global basis and implement
measures to recover production while managing funds.

In the first quarter, despite efforts to improve costs due to the impact of the spread of the new coronavirus
infections, automobile production by major customers declined significantly, resulting in a sharp decrease inboth sales and profits.
In the second quarter of the fiscal year under review, automobile production began to gradually recover as
we made progress in improving costs. Japan and the United States that are our main regions recovered toalmost the same level as the same period of the previous fiscal year, and sales in China increased YoY.
As a result, consolidated net sales decreased by 21.7% YoY to JPY64.8 billion in the second quarter cumulativeperiod.
Although a loss was anticipated at the time of the announcement on July 29, operating income was JPY800
million, ordinary income was JPY1.3 billion, and quarterly net income was JPY900 million.

Consolidated net sales decreased by JPY17.9 billion. In terms of operating income, despite a decrease of JPY6.1
billion by sales volume decrease, we made progress in cost improvement by thoroughly reviewing costs andchanging the way we do business, and together with cost reductions, we achieved an effect of JPY2.5 billion,and secured a profit of JPY800 million.

Net sales in the Stamping and Molding Business decreased by 19% YoY to JPY45.7 billion. In terms of profitand loss, although it returned to profitability in the second quarter, due to the results of improvements andthe recovery in production by customers, it was not enough to cover the deficit in the first quarter, and thecumulative operating loss was JPY200 million.
Sales in the Valve Business decreased by 27% to JPY19 billion. In terms of profit and loss, the second quarter
surplus covered the first quarter deficit, and although the cumulative total declined by 67% YoY, we secured
a surplus of JPY1 billion.

Sales declined in Japan, Europe, the United States, and Asia due to the impact of a decline in automobile
production in each region. In North America, sales decreased significantly due to the impact of the shutdownof customer production lines in the first quarter, et cetera, resulting in an operating loss of JPY300 million.
In Asia, despite the suspension of production in China in February and March, sales decreased only slightly toJPY11.6 billion, down 10%, and operating income increased by 3% to JPY500 million, mainly due to the rapid
recovery of production by major customers.

Full-year earnings forecasts have been revised upward due to the second quarter results exceeding thoseannounced on July 29, as well as the anticipated recovery in customer production from the third quarter
onward and continued improvement activities.
Net sales are expected to increase by JPY10 billion to JPY145 billion, operating income to increase by JPY4billion to JPY6 billion, ordinary income to increase by JPY3.5 billion to JPY6.5 billion, and net income to increaseby JPY2.5 billion to JPY4.5 billion.
The exchange rate for the third quarter onward is set at JPY105 to the US Dollar.

For the full fiscal year, both net sales and operating income will decrease significantly, due to a decrease insales volume caused by the impact of the coronavirus. Nevertheless, we will continue to work to improve
costs and reduce expenses.

In the Stamping Business, net sales are expected to recover to the previous year’s level in the second half. For
the full fiscal year, net sales are forecast to decrease by 10% YoY to JPY102 billion.
Operating income is expected to decrease by 35% YoY to JPY2.5 billion, reflecting cost reduction initiatives
and efforts to reduce expenses, in spite of a decrease in income due to a decrease in sales and an increase indepreciation expenses.
Sales in the Valve Business fell by 18% to JPY42.7 billion. Despite efforts to reduce costs, operating income isexpected to decrease by 47% to JPY3.5 billion, due to a decrease in sales volume and amortization of goodwill,
et cetera.

Although we are forced to lower sales and profits due to the impact of the first half of the fiscal year, therecovery in Europe and the United States is expected to lag behind that in Japan and Asia.

At a meeting of the Board of Directors held on October 28, the Company decided to pay an interim dividendof JPY10. We plan to pay a year-end dividend of JPY10 per share, as announced, for the current fiscal year.
Together with the interim dividend of PY10 per share, we plan to pay an annual dividend of JPY20.
The dividend payout ratio for the full fiscal year is expected to be 26.9%.

While restraining capital investment for the full fiscal year, we will carefully select the necessary investments
and plan to pay JPY19 billion. Depreciation is expected to be JPY15 billion, due in part to items have alreadybeen implemented from the previous year.

For the full fiscal year, free cash flow is expected to be negative JPY2 billion, but we expect to cover it withborrowings and have the balance of cash and deposits at the end of the fiscal year is expected to be JPY20billion. Interest-bearing debt is expected to increase by JPY5.3 billion to JPY68.9 billion, due to short-termborrowings to secure working capital and long-term borrowings for capital investment.
With regard to fund demand, we are taking all possible measures by secure short-term borrowing limit andcommitment lines while managing funds on a Group-wide basis.

We operate our businesses based on the medium-term management plan, OCEAN-22, under the long-term
vision, PACIFIC GLOCAL VISION. We believe that it is our mission to contribute to the realization of asustainable society and have so far positioned it as an important issue for CSR and ESG management and haveincorporated it into a variety of activities.
In our sustainability management efforts, we have identified themes as four pillars linked to our long-term
vision and SDGs themes that will focus on 15 materiality items.
With the four pillars of sustainability management, we first address the trust and fostering of stakeholders. In
terms of technology, we decided to resolve social and customer issues through our products. We will promote
the resolution of social issues, focusing on our existing domains, the automotive field. In addition, whileworking to minimize the environmental impact of our business activities, we will continue to respect humanassets and work to enhance awareness of human resource development, women’s active participation,
diversity, work style reform, et cetera within the Company.
Going forward, the PACIFIC INDUSTRIAL Group as a whole will aim for sustainable growth by embodying
targets and implementing initiatives for the themes and materiality.

In accordance with our vision of becoming a truly “glocal” Company that is trusted by stakeholders, rooted inlocal communities, and can coexist and develop, we have identified materiality from the perspective ofcontributing to the development of local communities and society by valuing the relationships of trust weplace with our stakeholders, including society, suppliers, customers, and local communities.
To commemorate the 90th anniversary of the Company’s foundation, we donated a PCR inspection car witha transporting function to Gifu Prefecture. We believe that it can be used effectively for the benefit of theregion in the coronavirus crisis.
Next, we will contribute to sustainable mobility and affluent lifestyles by solving social and customer issues
through our products and utilizing our proprietary technologies.
In particular, in the area we have been working on, we believe that we can contribute to the improvement offuel efficiency, reduction of CO2 emissions, and reduction of environmental impact through the evolution oflight weighting technologies.

As an initiative toward a sustainable society, we have also identified materiality from the viewpoint ofminimizing the environmental impact of our business activities.
As part of the PACIFIC Environmental Challenge 2050, we have set long-term targets for reducing CO2emissions, waste emissions, and water consumption, and have begun working to achieve these targets. As a
Company that conducts business globally along with the bounty of the global environment, we will work
globally to realize a sustainable society.
In addition, we are a manufacturing Company, and respect for human assets and active participation areindispensable for sustainable growth. Manufacturing is based on our belief in human resource development,
and we will promote the development of internal human resources and a corporate culture that enables us
to take on challenges.
In particular, we are continuing to develop human resources at home and abroad through improvement
activities, synergy activities with Schrader, and education at a learning center to learn about manufacturing,which we have been vigorously pursuing during the coronavirus crisis. We believe this will bear our efforts toenhance our business foundation and strengthen our competitiveness.
We aim to create an environment in which all employees can work enthusiastically, leverage diverse ideas,value new challenges, and contribute to society.

The automotive industry is in an era of major transformation that is said to occur once every 100 years. Inaddition to technological advances such as progress toward a mobility society and CASE, we need to respondto a variety of social demands, including SDGs I explained earlier.
We believe that changes in the external environment will accelerate further in the aftermath of thecoronavirus crisis and we will need to revise our medium-term initiatives and add new initiatives. At present,
we will continue to solidify the foundations of our efforts to improve costs and improve profitability by taking
advantage of our learnings from the coronavirus crisis.
In addition to advancing existing technologies, we will work to create new technologies, products, andbusinesses.

In the Stamping Business domain, based on our know-how in die and process designs, we will advance weight
reduction technologies such as ultra high-tensile stamping and aluminum forming, improve crash analysis
technologies, and develop functional components such as battery cases and forging presses.
In the Molding Business domain, we will continue to develop technologies that contribute to soundproofingand vibration-proofing of EVs, in addition to providing highly designed products using film decoration
technologies, and technologies such as soundproofing and vibration-proofing of engines using urethane foammolding technologies.

In the future, as vehicles become increasingly lighter, we will propose the development of optimal body design
through the evolution of structural analysis technologies that consider the safety of collisions.
By expanding our business domains from upstream to downstream in body skeleton formation, we aim toadvance from a Stamping manufacturer to a Body Shell manufacturer.
In the Molding Business, the need for soundproofing and vibration-proofing, which can respond to motor
noise and various types of noise, is increasing further, due to the adoption of EVs. We will evolve soundproof
product technology from the development stage of new materials.

In the Valve Business, together with Schrader, we will provide products that leverage our sealing technology,
such as our founding products, such as our valve cores, tire valves, valves for car air-conditioning, andindustrial valves.
TPMS will continue to strengthen its competitiveness and expand its response to OEs, while promoting thedevelopment of variations for aftermarket, two-wheeled vehicles, and other applications.

Due to changes in the powertrain caused by the use of EVs, car air-conditioning systems have adopted a heatpump method, requiring a new control valve. Leveraging the knowledge we have cultivated in valves for
consumer electronics, we will propose the development of competitive products.
TPMS is globally subject to laws and regulations and we will strengthen sales of general-purpose transmittersfor the aftermarket.
Schrader Business, which we integrated into our management in 2018, has been effective in terms ofmanufacturing, including improving quality, cost, and productivity. In addition, we will collaborate on newtechnologies and product development and expand sales to both customers with the aim of generatingsynergies.

We have been promoting product development initiatives in new fields by leveraging the core technologies
cultivated in our existing businesses.
In Food Products and Pharmaceuticals, there is growing demand for monitoring, including stricter regulations
on product management in the production and transportation processes, and in the Livestock industry,
demand for livestock body management. We are developing device solutions that utilize sensing technologies
and wireless technologies cultivated in TPMS.
As a developed product applying sensing technology, we will respond to the need to secure safety and security,
such as a charging cable with a forklift ignition prevention thermostat function and a server abnormality
monitoring system at a data center. We will work to accelerate development by capturing multifaceted needs
that emerge as IoT and ICT evolve.

Finally, from the long-term management perspective that I explained today, we have renamed the CSR Report,
which we have been publishing, to the Sustainability Report from the standpoint of pursuing the sustainabilityof society and businesses on a global basis. We improved its content and published it on October 28.
Under Pacific Glocal Vision, we will promote sustainability management by adding SDGs activities to thebusiness development of the medium-term management plan OCEAN-22.
In addition, this report aims to globalize information disclosure and enhance the content of non-financial andother information. It is posted on our website, so we would like you to take a look at it by all means.
Finally, we aim to become a 100-year Company, and we sincerely want to contribute to the future.