October 31, 2023
To whom it may concern,
Company name:
Representative:

Contact:

PACIFIC METALS CO., LTD.
Masayuki Aoyama, President
and Representative Director(Securities code: 5541
TSE Prime Market)
Terunobu Matsuyama,
Managing Executive Officerand Director(Telephone: +81-3-3201-6681)

Notice Concerning Recording of Non-operating Income (Share of Profit of Entities Accountedfor Using Equity Method) and Revisions to Financial Results Forecast
PACIFIC METALS CO., LTD. (the “Company”) hereby announces that it has recorded share of profit ofentities accounted for using equity method under non-operating income for the six months ended September 30,2023 (April 1, 2023 through September 30, 2023). The Company also announces that, in light of the mostrecent performance trend, it has decided to revise the consolidated financial results forecast for the six months
ended September 30, 2023 (April 1, 2023 through September 30, 2023) and for the fiscal year ending March 31,2024 (April 1, 2023 through March 31, 2024) announced on August 2, 2023.
● Details of non-operating income (share of profit of entities accounted for using equity method)
For the six months ended September 30, 2023, the Company expects to record share of profit of entities
accounted for using equity method of 1,581 million yen due mainly to strong performance of entities
accounted for using equity method in the Philippines supported by strong demand, in addition to the1,245 million yen already recorded, for a total expected share of profit of entities accounted for using
equity method of 2,827 million yen.

1

● Revisions to financial results forecast
1. Revisions to consolidated financial results forecast for the six months ended September 30, 2023 (April 1,2023 through September 30, 2023)
ProfitBasic
Operating
Ordinary
attributable toNet sales
earnings perprofit
profitowners ofshareparentMillion yen

Million yen

Million yen

Million yen

Yen(Announced on August 2, 2023)

8,592(6,343)(3,712)(3,871)(198.49)

Revised forecast (B)8,083(6,194)(2,487)(2,611)(133.90)

Change (B–A)

(508)

148

1,224

1,259

Change (%)(Reference) Actual results for theprevious six months ended
September 30, 2022

(5.9)

──

─

17,642(4,464)605229Previously announced forecast (A)

11.75

2. Revisions to consolidated financial results forecast for the fiscal year ending March 31, 2024 (April 1,2023 through March 31, 2024)
ProfitBasic
Operating
Ordinary
attributable toNet sales
earnings per
profitprofitowners ofshareparentPreviously announced forecast (A)Million yen

Million yen

Million yen

Million yen

Yen(Announced on August 2, 2023)

20,885(7,089)(2,891)(3,246)(166.44)

Revised forecast (B)15,874(8,611)(3,511)(2,442)(125.22)

Change (B–A)(5,011)(1,522)

(620)

804

Change (%)(Reference) Actual results for theprevious fiscal year ended March
31, 2023(24.0)

───

34,852(12,588)(4,960)(5,026)(257.75)

3. Reason for revisions
With regard to the consolidated financial results forecast, the protracted situation in Ukraine continues
to affect the Japanese and overseas economies. The concerns about economic recession primarily against
the backdrop of the cumulative effect of monetary tightening in the U.S., Europe and other regions, aswell as the delay in China’s economic recovery has made the economic outlook even more uncertain.
On the volume front of ferronickel products, the environment in which the Company operates hasremained largely unchanged and the Company expects results to be lower than the previously announced
forecast, as the Company aims to further control volume from the viewpoint of profitability.
In terms of profit and loss, on the selling price front of ferronickel products, the Company also partiallyrefers to the price of nickel pig iron, which has a price advantage over ferronickel products, in addition tothe applicable LME nickel price in setting the selling price of the Company’s products. Therefore,
income growth was restrained to a certain extent. Moreover, on the procurement front, prices of nickel
ore, which is the main raw material, continue to remain high, as do the prices of raw materials, fuel andelectricity. These and other factors are expected to have a significant impact.
In other areas, regarding a write-down of inventories, while the Company expects to record additional
write-down of inventories for the first half, a reversal is expected to occur in the second half because of areduction in the write-down amount. Therefore, the earnings trend is expected to differ for the first half
and the second half. In addition, as announced in the “Notice Concerning Recording of Extraordinary
Income (Gain on Sale of Investment Securities)” dated October 5, 2023, the Company expects to record a2

gain on sale of investment securities under extraordinary income.
Although the situation remains challenging, response measures against such business environment areconsistent with activities to be undertaken under the basic policies set forth in the Group’s Medium-termManagement Plan, and the Company will continue to strongly push forward with these measures.
Accordingly, the consolidated financial results forecast has been revised as described in the previouspage. For the underlying assumptions, please refer to “(Reference) Revisions to underlying
assumptions.”(Note) The forward-looking statements including the financial results forecast contained herein are based on information
currently available to the Company, as well as certain assumptions deemed reasonable by the Company. Actual
results may differ significantly from these forecasts due to various factors.

(Reference) Revisions to underlying assumptionsSales volume (t)Production volume (t)Applicable LME nickel priceApplicable exchange rate($/lb)

(¥/$)

1st

2nd

Full

1st

2nd

Full

1st

2nd

Full

1st

2nd

Full

half

half

year

half

half

year

half

half

year

half

half

year

Previously
announced
forecast(August 2,2023)

3,330

4,870

8,200

3,428

3,540

6,968

10.82

10.00

10.33

135.34134.10134.60

Revisedforecast

3,052

3,148

6,200

3,210

2,848

6,058

10.78

9.27

10.01

140.18139.22139.69(Reference)
Actual results
for the previous
fiscal year
ended March
31, 2023

5,668

6,725

12,393

8,079

5,301

13,380

12.12

11.11

11.57

131.49138.44135.263