The Sumitomo Warehouse Co.,Ltd(Securities Code : 9303)

Fifth Medium-Term Business Plan
(FY2023 to 2025)

I. Status of Achievement of Fourth Medium-Term Business Plan (1)•We have steadily executed our business strategy while responding to environmental changes
such as global supply chain disruption and growth of e-commerce demand caused by the impactof COVID-19.
Business strategies based on environmental changes
during the plan period
Restructuring of businesses with decreased
profitability
Acceleration of strengthening of international
logistics foundation

Strengthening
the businessfoundation /Maintaining
logistics
infrastructure

Main initiatives

Evaluation•

Transfer of all Westwood Shipping Lines ,Inc.
shares and vessels to the Swire Group〇•Third warehouse construction in Laem Chabang,
ThailandOpening of forwarding sites in Houston, USA andShenzhen, China〇•Expansion of robust warehouse demand in
preparation for natural disasters•

Construction of 3 warehouses (Inuyama, Hanyu,Kobe)〇

Response to logistics demand associated withchanges in socioeconomic activities caused by thepandemic•

Strengthening of operations related toe-commerce〇Continued acquisition of income property•Acquisition of nursing homes and building forrental housing△•

Promotion of digitalization
Implementation of i-Warehouse® / i-Clearance®

〇•

Adoption of external technologies
Introduction of new technologies such as AI-OCRand robotics〇

Use of design with consideration for natural
disasters prevention and reduced environmental
impact in 3 new warehouses
Procurement of construction funds with greenbonds〇

Response to labor shortage
Promotion of improvement of efficiency ofImplementation
operations and labor saving utilizing the latestof DXtechnology•
Contribution tosustainabilityStrengthening of environmental responses in own
facilities•

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I. Status of Achievement of Fourth Medium-Term Business Plan (2)•Although the business investment amount centered on the real estate business was not achieved
due to rising real estate prices, performance targets were achieved.

Operatingrevenue
OperatingincomeTargetResultEvaluation

Note

210.0 billion yen

231.4 billion yen〇

Logistics business grew〇

Performance of shipping business
improved

12.0 billion yen

27.7 billion yen

Business
investment

50.0 billion yen

39.0 billion yen△

Business investment centered onthe real estate business was notachieved due to rising real estate
pricesROE

Aiming for 5% or higher

10.7%

〇

ROE increased due to improvementof operating margin

Annualdividend

Maintain minimum of 47
yen per share andcontinue with increases

100 yen per share〇

Acquisition oftreasury
shares

Implement flexibly

Approx. 7.5 billion yen
over 3 years〇

Continued to increase dividends for
3 years and made purchases oftreasury shares every year2

II. External Environment and Issues Faced by the Group••

Logistics services required by customers inside and outside Japan have diversified through thepandemic.
The impact of heightened awareness of climate change and progression of decline and aging of
population is materializing.
Awareness of environment

Impact on logistics industry

Destabilization of international conditions
and heightened geopolitical risk

• Reorganization of supply
chainsChanges in lifestyles and values causedby the pandemic• Expansion of e-commerce
logistics demand

Heightened sense of crisis concerning
climate change and movements aimed atcarbon neutrality• Requirements to strengthen
initiatives aimed at
resolution of ESG issues

Issues faced by the Group•

Response to logistics demandassociated with reorganization ofsupply chains•

Response to increased frequency andsmaller lots•

Materialization of initiatives aimed atachievement of environmental targets
Expansion of logistics services aimed at
reducing customers’ environmental
impact••Progression of decline and aging ofpopulation• Decrease in working
population engaged in thelogistics industry• “2024 problem”*••

Establishment of sites assuming
demand for dispersed logistics sites
Promotion of relay transportation, jointdelivery, modal shift, etc.
Promotion of improvement of efficiency
and reduction of labor throughdigitalization*So-called logistics industry’s “2024 problem”, which includes regulations on the maximum number of overtime hours that truck drivers are allowed to work3

III. Positioning of the Fifth Medium-Term Business Plan

Sumitomo’s Business
Philosophy“Integrity”“Sound Management”“Not Pursuing
Immoral Business”“Benefit self and others, private and public interests are one andthe same”
We will provide earnest and timeless support for logistics functions as theCorporate Philosophy

social infrastructure, which is needed by all, while also working to create
new services sought after by our customers and societyLong-Term Vision“Moving Forward to 2030”

Fifth Medium-TermBusiness Plani Connecting thingsii Connecting the world

iii Connecting people

iv Connecting times

Aim for further growth by concentrating management resourceson core businesses of logistics and real estate4IV. Out line of Fifth Medium-Term Business Plan•

Aim for further growth by concentrating management resources on the two core businesses oflogistics and real estate.
Business Strategy

1. Logistics business•

Numerical Targets
CapitalConsolidatedConsolidated
operating revenue operating income expenditures

230 billion yen

Further expansion of logistics network insideand outside Japan•

Expansion of logistics services•

Digitalization of operations, promotion of DX

2. Real estate business•

Expansion of revenue base through promotionof leasing business•85 billion yen

ROE

Dividends

7%

Minimum of 100 yen per share
Guideline of DOE* of 3.5% to 4.0%
* DOE: Dividend on equity ratio

Reduction of cross-shareholdings:
Aim to reduce cross-shareholdings by approx. 10 billion yen by March2028 (equivalent to approx. 10% of book value as of March 31, 2022)

Expansion of business content to sales business3. ESG management

18 billion yen

Reduce by 6 billion yen of the above 10 billion yen by March 2026
(equivalent to approx. 6% of book value as of March 31, 2022)

Environmental target:
Reduce greenhouse gas emissions of Scopes 1 and 2 on a nonconsolidated basis by 50% from the FY2018 level by FY2030.

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V. Business Strategy in Logistics (1)•In addition to continuing investment in warehouses that are the business foundation, promote
expansion of logistics services.
Expansion of logistics network inside and outside Japan

 New warehouse construction in Japan

Expansion of logistics services
 Functional improvement of warehouse facilities

Continuously promote expansion of warehouse capacity. Actively

Capture demand backed by global warming, promote thecapture demand against the backdrop of the “2024 problem”

expansion of constant temperature facilities, and expand handling• New warehouse in Shizuoka areaof high value-added products, in addition to increasing the(scheduled for completion in 2023: approx. 30,800 m2)• New warehouse in Fukuoka area(scheduled to start consruction in 2023: approx. 12,000 m2)

environmental performance of air conditioning equipment

 Expansion of refrigerated air transportation services
 Strengthening of BPO services in archives business Expansion of relay transportation (Enshu Truck: e-change)

Implement further deployment of services for the Expansion of overseas business

implementation of paperless operations by customers such as thePromote warehouse construction and acquisition in Thailand andconversion of documents into electronic data

Europe. Expand warehouse business in Indonesia and Vietnam, andcreate synergies with existing forwarding business.
• Third warehouse in Laem Chabang, Thailand(scheduled for completion in May 2023: approx. 14,300m2)• Continue consideration of fourth warehouse in Laem Chabang,Thailand

Interior view of L6 300 warehouse at Kobe Chuo Logistics Center with temperaturecontrolled zone floorspace increased in May 2022

6V. Business Strategy in Logistics (2)•Establish a competitive advantage through digitalization and automation of operations and thepromotion of DX.
Increased functionality of web services

Digitalization of operations, promotion of DX
 Promote increased functionality of web services
Provide high value-added logistics services in international
logistics operations including import and export operations inaddition to peripheral operations

 Promotion introduction of automation equipment
such as robots
Promote improvement of productivity through renewal of AGV
and material handling equipment

 Renewal of container terminal management system

Logistics segment
FY2025
Numerical targets

Provide high value-added services utilizing digital technology inlogistics operations where analog responses such as paper
documents, mail and telephones remain. Offer services
supporting DX for customers in an effort to expand turnover.
••

•
••

Unification of correspondence in logistics operations intoweb service
Reduction of administrative man hours on customer sidethrough digitalization of customs clearance administration
utilizing AI-OCR, etc. (i-Clearance®)
Management, recording and provision of customs clearance
information
Digital storage of trading documents
Provision of information on greenhouse gas emissions

Operating revenue

Operating income

Cumulative
investment amount

213.5 billion yen

17.5 billion yen

40 billion yen(Up 10.2% from FY2022)(Up 11.9% from FY2022)(Up 11.5 billion yen from period ofprevious Medium-Term BusinessPlan)

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VI. Business Strategy in the Real Estate Business (1)• The real estate leasing business has been operated starting with the redevelopment of warehousesites.
• In recent years, in addition to redevelopment, growth has continued through the promotion of
new real estate acquisition.
Results of expansion of revenue base through promotion of leasing business Redevelopment of existing landand buildings

Conduct redevelopment ofwarehouse sites, and operate officebuildings and commercial facilities,etc.
Redevelopment results Acquisition and development of
new land and buildings

Leased real estate space
Increased by 53% over 20 years
Unit: thousand m2

Acquisition of residential facilities, etc.
centered on office buildings in theKeihin area and the Hanshin area274

Acquisition
Acquisition results
results

232

281

290

245

189

Tokyo Sumitomo Twin Buildings(Chuo-ku, Tokyo)

Yodoyabashi Mid-Cube(Osaka-shi)

2002 200520102016 2019 2022
Fiscal year-end8

VI. Business Strategy in the Real Estate Business (2)• Implement replacement of real estate for lease aimed at further growth and the avoidance of adecline in future profitability associated with the increase in the number of years sinceconstruction of real estate held.
• Reinvest funds obtained through the sale of non-core assets in the acquisition of real estate forlease and real estate for sale that are core assets with the aim of expanding revenue scale.

Replacement of realestate held
Replace holdings of realestate for lease to improve
medium- to long-term
profitability. Promote theexpansion andimprovement of efficiencyof leasing business

Real estate segment
FY2025
Numerical targets

Expand business content
to sales business
Gradually operate asset
turnover business while
replacing real estate*Offices, builings for rental
housineg, logistics
properties

Aim to conduct business
conscious of capitalefficiency by operating
sales business with theleasing business as thecore in the medium tolong term.

Operating revenue

Operating income

Cumulative
investment amount18 billion yen

6 billion yen(Up 68.6% from FY2022)(Up 15.7% from FY2022)

40 billion yen(Up 31.2 billion yen from period ofprevious Medium-Term Business Plan)

9VII. Performance Target•

Aim for 230 billion yen in consolidated operating revenue, 18 billion in operating income and ROEof 7% in FY2025.

FY2022
Excluding shipping
business

FY2025 plan

FY2022→2025 change

Consolidated
operating revenue

203.8 billion yen

230.0 billion yen

26.2 billion yen

12.9%

Logistics business

193.7 billion yen

213.5 billion yen

19.7 billion yen

10.2%

Real estate business10.6 billion yen

18.0 billion yen

7.3 billion yen

68.6%

Inter-segment revenue(0.5) billion yen(1.5) billion yen(0.9) billion yen-Consolidated
operating income

15.7 billion yen

18.0 billion yen

2.2 billion yen

14.0 %

Logistics business15.6 billion yen

17.5 billion yen

1.8 billion yen

11.9%

Real estate business5.1 billion yen

6.0 billion yen

0.8 billion yen

15.7%

Company-wide expenses(5.0) billion yen(5.5) billion yen(0.4) billion yen-10

VIII. Cash Flow Allocation•

While maintaining a sound financial base, utilize funds from the sale of Westwood Shipping Lines(WSL) shares and vessels along with external borrowing, etc. to execute business investment
totaling 85 billion yen over 3 years.

•Execute active business investment while continuing ample shareholder returns.
IN

Operating CF, other74 billion yen

Sale of WSL shares andvessels, etc.

OUTBusiness segment

UseLogistics
40 billion yen

Strategic Investment
70 billion yen

Real estate
40 billion yen
Corporate
5 billion yen(including 10 billion yen in investment
for environment, DX and “people”)

Ordinary investment
15 billion yen

25 billion yen
External borrowing
10 billion yen

Allocation to funding forshareholder dividends

24 billion yen* Funding for acquisition of treasury shares is separate

Shareholder dividends
24 billion yen* Funding for acquisition of treasury shares is separate

11IX. Shareholder Returns•

Continue business investment required for enhancement of corporate value from a medium- tolong-term perspective, and implement shareholder returns with consideration for theimprovement in profitability in each fiscal year.
Dividends

Acquisition of treasury shares



Minimum annual dividend per share of 100 yen

Flexibly implement treasury share acquisition, taking into

Guideline of DOE* of 3.5% to 4.0%

consideration economic conditions, market trends, business* DOE: Dividend on equity ratio

investments, and profit levels.

97100Forecast
10120212022

2023

Annual dividend per share

222426

28

3133

2012

2013

2014

2015

2016

2017

45.5

4748

2018

2019

2020

2024

2025 FY

Second Medium-TermBusiness Plan
Based on non-consolidated
dividend payout ratio

Third Medium-TermBusiness Plan
Based on consolidated
dividend payout ratio

Fourth Medium-TermBusiness Plan

Fifth Medium-TermBusiness Plan

Continuous dividend
increases

Based on DOE

Minimum of 20 yen

Minimum of 30 yen

Minimum of 47 yen

Minimum of 100 yen

12X. ESG Management•Steadily implement initiatives aimed at promotion of ESG management.
Society (S)Environment (E)•Set environmental targets
Reduce greenhouse gas emissions of Scopes 1 and2 on a non-consolidated basis by 50% from theFY2018 level by FY2030.

•Initiatives aimed at targets•

Continue initiatives aimed at security and safety•

Strengthen investment in “people”•

Contribute to “Expo 2025 Osaka, Kansai, Japan”
Handle expo logistics operations as a designated onsite cargo handlers (joint venture by Sumitomo
Warehouse Group and Maguchi Group) Expand implementation of energy-saving
equipment Expand implementation of solar power
generation systems
 Utilize renewable energy
 Use electric vehicles (EV) for company vehicles
and install EV charging stands

Governance (G)• Reduce cross-shareholdings Aim to reduce cross-shareholdings by approx. 10billion yen by March 2028 (equivalent to approx. 10%of book value as of March 31, 2022)
 Reduce by 6 billion yen of the above 10 billion yen by
March 2026 (equivalent to approx. 6% of book value
as of March 31, 2022)
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XI. TOPICS Expo 2025 Osaka, Kansai, Japan••

The joint venture by Sumitomo Warehouse Group and Maguchi Group is a designated business operator (only 2business operators) able to provide one-stop service for logistics operations inside and outside the venue of Expo
2025 Osaka, Kansai, Japan.
We provide logistical support for the smooth operation of Expo 2025 Osaka, Kansai, Japan.
Scope of Operations for the joint venture by Sumitomo Warehouse Group and Maguchi Group
2 business operators including the joint venture by
Sumitomo Warehouse Group and Maguchi Group

17 business operators including the joint venture by
Sumitomo Warehouse Group and Maguchi Group

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