Sunstar
Group Report
2024

January - December 2023

Who we are

Our Purpose
Mission and Vision
Through enhancing oral and physical health and beauty,
and creating safe and comfortable living environments“Leading happier lives and building healthier futures”

Corporate Motto“Always strive to help people everywhere achieve better healthand enhance their quality of life.”

Sunstar is a global conglomerate of oral care, health and beauty, indoor air quality,
adhesives and metal parts for mobility and living environments. We offer a wide range of
products and services focused on enhancing well-being through enhancing oral andphysical health, reducing pollutants in the air we breathe, and creating safe andcomfortable living environments. Through our global operations, we help people leadhappier lives and build healthier futures.

Origin of the Sunstar group
Sunstar has evolved considerably since it was founded in 1932 as a bicycle components
wholesaler in an era when bicycles were a status symbol for the aspirational Japanese
consumer. Our subsequent expansion into new market segments was often madepossible by identifying potential new applications for our existing technology portfolio –finding new purposes for our innovations.
For example, one of our earliest product success stories – a rubber glue supplied in a
metal tube for easier application – was the source of inspiration for our first tubed
toothpaste product. By adapting our existing metal tube manufacturing equipment, wehelped revolutionize oral care with the creation of a new consumer product that would
become the cornerstone of our business.
In subsequent decades, we continued to develop our Consumer Business with the additionof further oral care products, alongside cosmetics, health foods, and more. Meanwhile,having recognized the limited future growth potential of bicycle maintenance, the Industrial
Business began to focus on metal components for motorcycles, in addition to adhesives
and sealants for use within the automotive, construction, and electronics industries.
Our strengths in chemical engineering, metal processing, and design and manufacture of
product packaging have put Sunstar in an excellent position to take a leading role inemerging markets. We have been relentless in seizing the challenge of developing new
products and businesses, constantly seeking to adapt and expand our business.
At Sunstar, we are continually aiming to forge new relationships with other innovators,
collaborating with experts from around the world. Together we keep developing new
solutions to help fulfill our customer needs.

Consumer Business

Sunstar Group Report 2024 I 01

Industrial BusinessLeading happier lives
and building healthier futures

the automotive adhesives business, where solutions to support the decarbonization of the automotive industry
were key growth contributors.
We continue to be proactive in addressing our carbon footprint, introducing measures to reduce greenhouse gas
emissions associated with our operations. The introduction of plant-based materials for mouthwash bottles in the

Sunstar Group Representative

Japanese market, and the installation of solar panels at our plants in Germany and Singapore, are just a couple of

Yoshihiro Kaneda

the initiatives we have pursued to make our businesses more sustainable.
Sunstar shares consumer concerns about environmental and social challenges, and we continue to reform ourThroughout 2023, the world has continued to be a challenging place to do business, with increased energy,business structures, culture, and other aspects of ourtransportation, and raw material costs, with this price inflation fueled in part by the eruption of conflicts across theorganization. By developing our organizational capabilities, weglobe. These pressures have emerged as we continue to work on addressing social and environmental challenges

are confident of fulfilling our purpose of helping people across

such as global warming, natural disasters, and the threat of infectious diseases.

the world “lead happier lives and build healthier futures.”

Undeterred, Sunstar Group has been harnessing the skills and experience accumulated over our long history to

As we approach the 100th anniversary of the founding ofcontinue to create shared value through driving innovation across the consumer and industrial markets while living

Sunstar Group, we pledge to accelerate our work toward

up to our ESG responsibilities.

realizing this long-term vision and medium to long-term

Ultimately, 2023 was a strong year for Sunstar excluding the effect of exchange rate. In the Consumer Business,environmental objectives. We will continue to be a growing

increasing awareness of the critical role oral care plays in healthy living has fueled the continued growth of thecompany, with innovation at its heart, that plays an invaluable

GUM brand across Latin America, North America, and Europe.

role in the world, like the sun and the stars.

PublicHealthGlobalHealthOne
HealthOur Purpose Mission and Vision

The Industrial Business also experienced increased organic sales and profits across all segments, including within

Planetary
HealthSunstar's well-being and ESG-driven management

Creating
opportunities

E ( Environment )S ( Society )G ( Governance )Motorcycle& Automobile Parts

Businesses contributing to the well-being of people around the world as well as the planet
・Products and businesses that solve environmental issues
・Low-environmental-impact manufacturing processes
・Improvement of logistics efficiency
・Reduction of packing materials

・Creating lifestyle habits that support health and beauty
・Improving indoor air quality
・Enhancing the comfort and safety of buildings and vehicles
・Supporting the health and wellness of local communities

・M&A
・Investment strategy
・Fundraising
・Fund management

Indoor Air Quality
Improvement

Mobility

Body

Contributing
to SDGs

Controllingrisks

Living Space

Health Care・Reduction of CO 2 emissions
・Low-environmental-impact raw materials
・Resource recycling
・Waste reduction
・Prevention of environmental pollution
・Biodiversity conservation

・Product quality control
・Customer relations
・Respect for the human rights of employees and business partners
・Enhancement of employee engagement and motivation
・Enhancement of employee well-being and productivity
・Contribution to local communities

・Financial soundness
・Tax transparency
・Corporate governance integrity
・Risk management
・Compliance

Mouth

Oral Care

Adhesives& Sealants
Beauty Care

Sunstar Group Report 2024 I 02

Sunstar Group Long-Term Vision
Our vision for the company in 2032
Sunstar is a company that contributes to enhancing healthy life expectancy and quality of life (QOL),
starting from good oral health to preventive medicine and holistic wellness.
It is important for us to be recognized as the most trustworthy company in the world, providing total
support for people to live a healthy and comfortable life in all living environments including mobility andbuildings.

Sunstar’s SDGs key goals
We will provide products and services that will
help people live healthier lives, from thepromotion of oral and overall health toimproving the living environments of people all
around the world.

We will support people's comfortable and safe
lives in all living spaces, including buildings andmobility.

We strive to prevent, reduce, and reuse waste
products through the entire life cycle of our
products—from procurement to manufacturing,logistics, sales, and even post-consumer use.

To contribute to achieving carbon neutrality, we
will work to reduce CO₂ emissions throughout
our supply chain including materials, products,
manufacturing and transport.

*SDGs (Sustainable Development Goals) are 17 global goals set by the United Nations with UN member states to achieve a sustainable world with abalanced economy, environment and society by the year 2030.

Adding goal 13 to Sunstar Group’s SDGs key goals
Sunstar is a longstanding advocate and contributor to UN SDGs and in 2023, we made a further pledge tocontribute toward Goal 13, “taking concrete action to address climate change”. This complements ourexisting objectives relating to Goal 3, “good health and well-being for all people,” Goal 11, “building
sustainable cities,” and Goal 12, “responsible consumption and production”.The diagram below illustrates
the three-tiered relationship between the 17 SDGs, clearly illustrating that without the “environment,” there
is no “society” or “economy.” Goal 13 is therefore an essential component to helping Sunstar realize its
vision of helping people across the world “lead happier lives and build healthier futures.”Recently, Sunstar
has dedicated significant efforts to cutting its CO2 emissions and making progress toward achieving carbon
Sunstar seeks to contribute to meeting social challenges through our business fulfilling our vision for theneutrality. In addition to greater use of renewable energy, we are also reducing the volume of oil-based

company in 2032. We are also working on initiatives through partnership with our stakeholders thatplastics used in products and packaging.

prioritize challenges such as the minimizing the environmental impact of our business activities, helping our
employees grow and prosper, establishing a sound management platform demanded by society at large.

Environment

Human Resources

EconomySociety

Environment

PartnershipManagement Platform
Source：「The SDGs wedding cake」（Stockholm Resilience Center）

Sunstar Group Report 2024 I 03

Sunstar has identified four major UN SDGs to contribute towards as part of our vision to help people across the world “lead happier lives and build healthier futures”. Alongside Goals 12 and 13 (requiring contributions from all
aspects of Sunstar group), the Consumer Business is primarily focused on Goal 3, and the Industrial Business on Goal 11.

Consumer BusinessIndustrial BusinessWe are contributing to UN SDG 3 "ensure healthy lives and promote well-being for all". By providing
products and services such as oral care, skin and hair care, health foods, and household products, wewill support a holistic approach to healthy living.

We are contributing to UN SDG 11, “build cities that continue to be livable,” by offering a wide range of
products and services focused on reducing pollutants in the air we breathe, enabling sustainable mobility,
and creating safe and comfortable living environments.

Our Purpose Mission and Vision

How Sunstar’s business contributes to UN SDGs

BIO

How Sunstar is contributing to Goal 3

How Sunstar is contributing to Goal 11• Providing products and solutions to help improve oral health, with options to cater to different age groups and totreat different health conditions• Encouraging healthy living by supplying health foods, hair care, and skincare products, and solutions to improveindoor air quality• Educating the public about the risk of oral frailty (decrease in oral function) and providing preventative products• Highlighting the risk of aspiration pneumonia during disasters, promoting disaster preparedness, and providing
related products• Promoting the adoption of healthy habits using IoT, AI, and other digital technologies• Providing solutions for improving health through research into bacterial flora of the mouth and gut• Supplying building materials that:-Aid in the construction of buildings that are resilient to the threat of earthquakes, fires, and other natural disasters-Extend the lifespan and improve the maintainability of buildings-Reduce waste generated in the process of upgrading and demolishing buildings• Developing adhesives and metal components that:-Improve the resilience and safety of mobility equipment-Aid the sustainability of mobility equipment, contributing to decarbonization-Suppress noise and vibration indoors and inside vehicles• Providing adhesives and disinfecting and deodorizing solutions to improve air quality inside buildings and vehicles

Across Sunstar
Sunstar is contributing to UN SDGs 12, “responsibility in creation and use,” and 13, “take concrete action to address climate change,” through efforts to prevent waste, promote the reuse of materials, and reduce CO2 emissions.
These initiatives will cover all aspects of the product life cycle, including procurement, manufacturing, logistics, sale, and disposal.

Contributing to the circular economy
Manufacturing
Resources
Resources
Circulation
Recycling

Consumption

Contributing to carbon neutrality

How Sunstar is contributing to Goals 12 and 13• Refining manufacturing processes to reduce waste creation and CO 2 emissions, starting from the product design stage• Increasing the proportion of plant-based and recycled materials in products, containers, and packaging• Reducing waste and creating frameworks to promote recycling at all stages of the product life cycle, including
manufacturing, sales, product usage, and disposal• Boosting the proportion of renewable energy used throughout the whole business and reducing other greenhouse gas
emissions

Sunstar Group Report 2024 I 04

Overview
Consumer BusinessIndustrial Business

Toothpaste
Mouthwash
Toothbrushes
BIO
Interdentals
Electric toothbrushes
IoT toothbrushes
Mouth spray
Dental treatment products
Orthodontic and denture oral care products

Sales by Business Sector

Oral beauty care products
Skin care cosmetics
Beauty care foods
Facial salons
Body care products
Hair care products

Health drinks
Health foods
Household detergents
Anti house dust sprays
Fabric sprays

Sunstar Group Report 2024 I 05

59%

41%

FY 2023

100

Based in22

Industrial
Business

ConsumerBusiness

Delivering
products in

Locationcountries
worldwide

Adhesives / sealants for automobiles
Adhesives / sealants for construction
Adhesives for electronics
Formed-In-Place Gasket (FIPG)

Metal parts for motorcycles(sprockets, brake discs)
Metal parts for automobiles
Metal parts for various mobility

Sterilization and deodorization systems
Sterilization and deodorization sprays

Employees

countries

4,000

employees

For FY2023, the Group's global consolidated net sales and operating income in Swiss francs can befound below. Americas, Europe, and Japan (separate from the Asia region) all experienced year-on-year
net growth in local currency terms. Excluding the impact of currency conversion, organic sales

Net Sales
1,250

1,123 1,159 1,103 1,066

1,000
750
500

Stockholder Equity & Ratio
900

120

1M,-066
CHF

100

99

92

80
60

46

42

40

250
0

The financial information in this report complies with International Financial Reporting Standards (IFRS).

Operating Income

1,500

1,307

increased by CHF 66 million (+5.9%) from the previous year's CHF 1,103 million. Operating income
also increased by CHF 20 million (+48%) from the previous year's CHF 46 million.

58

58
M - CHF20

12/2019

12/2020

12/2021

12/20220

12/2023［month/year］

Net Sales by Region

Americas［million US Dollars］

341

350

12/2020

12/2021

13％

120

125

109

124

128

141

289

275

280

299

577

547

45%

47%

579

557

12/2019

12/2020

12/2021

12/2022

12/2023［month/year］

50%
40%

518

30%

300

20%

150

10%

12/2019

12/2020

12/2021

12/2022

Stockholder equity
Equity ratio

518
M-CHF

0%
12/2023［month/year］［million Singapore Dollars］

325
300

299

282

280
262

275

246

250

0

20

47%

450

Japan

175

40

225

600

43%

200

100

0

47%

225

60

249

250

750

0

12/2023［month/year］

Europe160140

12/2022

80

325
300

29%

［million Euro］

12/201960%

Group Business Performance 2023

Group Business Performance 2023

［hundred million Yen ］

800
12/2019

12/2020

12/2021

12/2022

12/2023［month/year］

16％

Asia

740

700

42％
701

688

680

680

12/202

12/2021

12/2022

600
500

200
400

175
0

12/2019

12/2020

12/2021

12/2022

12/2023［month/year］

0

12/2019

12/2023［month/year］

Sunstar Group Report 2024 I 06

Consumer

Overview of the Consumer Business in FY2023
Even amidst inflation in energy, transportation, and raw materials costs because of global conflict, 2023
saw a second consecutive year of growth in sales in Europe and North America, despite decreased
revenues in Japan and Asia. In recent years, our presence has expanded in the Latin American market.
In 2023, effective marketing efforts in Mexico and Argentina focusing on key topics including interdental
cleaning, oral care for children, and orthodontics, led to an increased awareness of the GUM brand.
Europe has also seen strong sales performance across all countries, especially for interdentals andelectric toothbrush products.

Business
Oral Care

Future prospects

Beauty Care
Health Care
EQUITANCE

2％

700

600

Others14％

KENKODOJO

665

627

500

4％

Ora 2

11％

Europe

19 ％
Japan

GUM

69 ％

46％

Americas

30 ％
Asia

2022

2023

Net Sales（million CHF）

Sunstar Group Report 2024 I 07

Net Sales by Brand

Net Sales by Region

5％

As we move into an era when people can regularly expect to live to 100 years old, Sunstar’s Consumer
Business is seeking to help people live healthier and richer lives. By taking a holistic view of health andwell-being that begins with oral care, before going on to encompass greater whole health (including diet,beauty, and living environment), we can ensure that Sunstar customers are happy and healthy at every
stage of their lives.
With the rising threat of infectious disease, repeated natural disasters, and an increasingly elderly global
population, maintaining oral health is becoming more important due to its relationship with overall
well-being. Sunstar Group is working with dentists and trusted community figures to educate the public
about the importance of oral care, while accelerating our development of next-generation oral careproducts to meet changing market needs. We will expand Playbrush under the GUM brand in Europe,
continuing our efforts to help people establish healthy toothbrushing habits with the aid of digitaltechnology. We will also rebuild Playbrush’s supply chain, including production sites, and further develop
the brand in emerging markets. Meanwhile, in Japan, we will seek to address the growing healthdemands of consumers, responding to growth in skincare and other markets.
As part of our sustainability efforts, Sunstar has increased the proportion of plant-based materials usedin the plastics used for product packaging. This complements initiatives to expand the usage of recycledmaterials, develop products that are both healthier and more environmentally friendly, and identify how
to reduce the environmental footprint of all aspects of business operations.

Oral Care［US Dollars］
70,000“Latin American oral care business shows significant growth”
Growing the business through enhanced awareness of the GUM brandand educating the public on the important role of oral care in maintaining overall well-being
The Sunstar Group oral care business has seen incredible growth in Latin America in recent years, achieving a 45% increase in revenue
over the past three years. Growth in the region has been driven by the strong performance of children’s toothbrushes and interdental
brushes. GUM brand recognition among dentists and the general public has significantly increased because of our initiatives to raiseawareness of the importance of oral care as part of overall well-being.

Interdentals and children’s toothbrushes
driving market presence
We have grown our market share by focusing on interdentals andchildren’s toothbrushes, meanwhile, competitors have remained
focused on general toothbrushes and toothpastes.
The growth in children's toothbrushes can largely be attributed toutilizing popular characters and other IPs, and offering a wide range of
products and secure a larger market share. We have also developed
distinctive products to address regional needs, such as Paroex in
Mexico, and products for orthodontics patients in Argentina.

Consumer Business

Consumer Business highlights:

60,00050,00040,00030,000■Mexico20,000■Argentina■Brazil

10,000

Building brand recognition
for GUM through outdoor advertising, events,
and digital advertising
Sunstar has been raising awareness of the GUM brand in Mexico
through outdoor advertising and running a variety of events andcampaigns. We also launched the “Change your Dentality” campaign toraise awareness of the importance of incorporating interdental brushinginto your daily oral care routine. Meanwhile, in Argentina, our businesshas grown thanks to a coordinated digital campaign featuring social
media posts, e-commerce-aligned sales promotions, and the launch ofsmartphone apps.

■Colombia

0
2020

2021

2022

2023

［year］■Distributor

Raising awareness of the valueof oral care through partnerships
with dental professionals
Sunstar regularly engages with dental professionals, hosting seminars
and product displays at many academic conferences and exhibitions in
the region. We also deliver regular lectures on the importance ofpreventative dental care at major universities and dental schools inArgentina and Mexico, increasing awareness of the importance of oral
care and how our products can help. These activities raise our social
presence and the value of Sunstar, while also contributing to businessdevelopment.

Sunstar Group Report 2024 I 08

Consumer Business

Oral Care

BIO

Toothpaste / Mouthwash / Toothbrushes / Interdentals / Dental treatment products
European growth thanks to product innovations
and interdental product marketing

Integrating Playbrush into the GUM brandto strengthen connected healthcare offer

A revamped product portfolio in Europe has aided growth, including the release of the new GUM Soft Picks Pro, offering 50%
increase in cleaning efficacy (compared to GUM Soft-Picks Advanced) thanks to a significantly increased number of softer, rubber
bristles. Product innovation was complemented by a 360-degree campaign in key European countries, with social media,
television, and in-store promotions designed to promote interdental usage and raise awareness of the GUM brand.

After the acquisition of Playbrushin 2021, the products are now
marketed as par t of the G U M
brand, helping to emphasize ourcommitment to encouraging
healthier brushing habits. We areprep ar ing to ex p and pro du c tavailability beyond its existing
markets in Austria and Germany tothe rest of Europe, beginning withFrance and Italy.

Launching vegan and organic-certified
GUM Bio Mouthwash in Europe

Filling out the Japanese premium periodontal care product lineup
with the GUM Labo series

Sunstar launched GUM Bio Mouthwash, its first mouthwash
made with 99% organic ingredients. The formulation hasreceived three vegan and organic certifications including
V-Label.eu and COSMOS certification. With a gentle
peppermint flavor, GUM Bio Mouthwash uses aloe vera’s
natural anti-bacterial and anti-inflammatory qualities forgum care, while containing just the right amount of fluoride
to strengthen teeth and protect them from caries. This new
product completes an organic product series designed tomeet the needs of consumers who value organic products
and natural ingredients.

With additional functionality to help prevent
periodontal disease, Sunstar’s GUM Plus Dental
paste product has experienced market share
growth in Japan. We have also expanded our
premium periodontal care lineup with the releaseof GUM Labo Series toothpaste and toothbrushproducts, which benefit from improved formulas
to help treat gum contraction due to periodontal
disease. The range now also includes GUM
Hypersensitivity Labo Dental Paste, formulated toaddress periodontal issues and hypersensitivity.

Sunstar Group Report 2024 I 09

Consumer Business

Beauty Care

Health Care

Skin care cosmetics / Hair care products / Oral beauty care products

Health foods / Household goods

Ora² benefits from increased demandfor on-the-go oral care products

Pop-up stores and influencer engagement
boost sales of KENKODOJO health foods

W i t h d e clining f ac e ma s k us age andincreasing social activity, consumer demandfor portable oral beauty care products is
growing. Oral algefacient Ora 2 Me Mouth
Spray and portable toothbrush set Ora 2 Me
Portable have experienced increased sales
volume due to these trends.

Disrupting our marcomm strategies and directly communicating with customers and Kenko Dojofans has resulted in a major boost for the healthy food brand. Not only the follower base has doubled
compared to the previous year, but also our 30% increase in pop-up stores openings at airports anddepartment stores has led to a 70% boost in contracts signed.

A powerful new ally against visible aging
from EQUITANCEEQUITANCE Wrinkle Approach EX is a new
medicated anti-wrinkle cream that uses
niacinamide as an anti-wrinkle agent. The
product has been praised for its ability tophysically improve the appearance of
age-related wrinkles.

First vegetable beverage to be awarded Japanese Disaster Food Certification
Six KENKODOJO vegetable-based beverage products have been awarded Japan Disaster Food
Certification by the Japan Disaster Food Society. This is the first time a vegetable beverage has
acquired this certification indicating that it can be stored for emergencies to provide valuable
nutrition. These products are gaining recognition for their ability to help maintain nutritional balance
during both normal times and in emergencies.

Sunstar Group Report 2024 I 10

Overview of the Industrial Business in FY2023
While 2023 may have resulted in declining sales in some markets due to the impact of conflicts in Ukraine
and the Middle East, global organic revenue and profits for the Industrial Businesses increased. This
success can be attributed to the progress made in supporting the automotive industry’s decarbonization
efforts, expanding the metal parts business across additional regions, and input price stabilization.
There has been strong sales growth in automobile and electronic adhesives, driven by demand from
Chinese and European automakers, and for Japanese automakers with North American manufacturing
facilities. Popular products included adhesives used to install large displays and cameras in automobiles,
cavity fillers for noise and vibration damping of vehicle cabins, and cases for electric vehicle battery packs.
Demand for construction sealants and adhesives was also strong, with sales to large semiconductor
factories in Japan and other major construction projects in China. To help the construction industry
improve its environmental footprint we have also developed recyclable containers for products. Growth inmetal parts sales has been aided by increased orders for brake discs for large motorbike OEMs in the US,
China, and Europe and through aftermarket sales in Japan and Asia. Inquiries from US and European
automobile manufacturers had also contributed to sales growth of metal parts. 2023 also saw the launch
of QAIS brand photocatalytic sterilization and deodorizing systems in the US and China, alongside theexisting Japanese market. This innovative technology is also being used to help us gain a foothold in the
rapidly expanding global market for pet equipment.
We also installed solar panels at our Singapore and Germany manufacturing sites, allowing us to reduce
associated greenhouse gas emissions by increasing the proportion of renewable energy consumed.

Industrial

Business
Chemicals
Material Core

Future prospects

E-Science
EuropeOthers

400

4％

1％

500

438 438

MaterialCore

20 ％Chemicals( Living
Environment＊2 )

300

18 ％

2022

Chemicals( Industrial
Materials＊1 )

61％

27％

37％
Asia

32％

2023

Net Sales（ million CHF）

Net Sales by Business* 1 Adhesives for automobiles and electronics* 2 Sealants for construction

Sunstar Group Report 2024 I 11

AmericasJapan

Net Sales by Region

Sunstar’s Industrial Business will continue to develop and market technologies to help create healthy,
pleasant, and safe living spaces and mobility options. In addition to fulfilling our commitment to producing
sustainable solutions, we will strive to improve the competitiveness of the business, expanding our
geographic reach and pioneering new market opportunities that take advantage of our existing adhesive
and metal processing technology platforms. This will include seizing opportunities to create new living
environment businesses and building on the success of our efforts to improve indoor air quality.
As part of its efforts towards carbon neutrality, the automotive industry is seeking new adhesives tosupport lightweighting and the electrification of vehicles. To take advantage of this opportunity, we areworking hard to improve our adhesive technology and production capacity. Alongside technology
development, we will be seeking new automotive manufacturing customers from Europe, China, anddeveloping countries.
In the construction sealants and adhesives segment, we intend to extend our product range to include
adhesives for indoor use and a greater number of high efficiency one-component products, to expand ourbusiness in China and introduce more environmentally friendly packaging. Growth in the metal parts
business will be achieved by expanding our product range to include brake discs for large motorbikes,
luxury bicycles, e-bikes, small EVs (for the Chinese and Indian markets), 4x4s, and outboard motors. The
indoor air quality business will seek to grow by improving its pet products and accelerating its global
development.In support of our sustainability objectives, we will continue to install renewable energy
sources at factories and seek to refine manufacturing processes to reduce their environmental footprint.

［ Sunstar adhesives for automobiles］

Significant growth by meeting the three key demandsof the automotive industry

1. Hem flange adhesive

In recent years, the automotive adhesives business has grown ［ Sales of adhesives for automobiles ］
dramatically. Sunstar has the product development capacity and （Units: million CHF）
expertise to meet the highly specific needs of different automobile 300
manufacturers and now offers a wide variety of adhesive products. 250
Our product portfolio addresses three core attributes desired by200
automobile manufacturers: 1) decarbonization 2) improved
150
comfort, and 3) global availability.
100

0

8. Liquid applied UV curable
masking material

2. Body sealer
9. Spot sealer
3. Mastic adhesive
4. Adhesive for electronics
5. Interior adhesive
6. Windshield adhesive(Direct glazing)
7. Structural adhesive(Weld bond)

50

Industrial Business

ChemicalsIndustrial Business highlights: Automotive adhesives

10. Formed‐in‐Place Gasket (FIPG)
11. Pumpable sheet metal stiffener (PSS)
12. Under body coating
13. Heat curing elastic adhesive
14. Pumpable sound deadener (PSD)
15. Cavity Filler

2021(1) Supporting the automotive industry net zero efforts
and electrification

2022

2023

(2) Helping create mobility options
with reduced noise, vibrations, and odors

Sunstar has promoted the adoption of adhesives in place of welding and screw fixings
illustrating how their use can support the automotive industry’s lightweighting efforts andhelp increase fuel efficiency. The industry’s focus on carbon neutrality (effective CO 2
emissions of zero), was a consistent theme throughout 2023; orders for EV battery cases
increased, FIPG was adopted by European automakers, and Japanese automakers chosedusing urethane-based adhesives. The increasing prevalence of electronic control systems to
support drivers has also fueled demand for adhesives suitable for fixing large displays andin-vehicle cameras.

Many automotive manufacturers are now using our
products as structural adhesives in car bodies to help
suppress noise and vibration. In 2023, we increased salesof coated foamed noise-insulation materials for use inJapanese high-end cars, and our odor-eliminatingwater-based adhesives for use in vehicle interiors were also
well received by electric vehicle manufacturers.

(3) Enhancing global production networks
and availability
In recent years, Sunstar has increased its US adhesives
production capacity and placed new production locations in
Europe and Indonesia, and encourage greater collaboration
between development, production, and sales locations inJapan, North America, Europe, and Asia. These efforts
resulted in strong sales growth in 2023, with high demand
from Japanese automakers with production facilities in
Nor th America, alongside the Chinese, A sian, andEuropean locations of European and Chinese automakers.

Germany
China
Singapore

Japan

USA

ThailandIndonesia＊for illustrative purposes

Sunstar Group Report 2024 I 12

Industrial Business

Chemicals

Material Core

Adhesives and sealants for automobiles, electronic components and construction

Metal parts for motorbikes and automobiles

Long-life and low-volatility sealants specified
for major Japanese construction projects

Increased orders for brake discs for large motorbikes
from North America, China, and Europe

Sunstar secured significant new sealant orders for use in the construction of amajor urban development project and large semiconductor factories in Japan.
This follows the positioning of our long-life sealants as suitable for external
applications, and the pitching of low-gassing sealants for internal applications.

Throughout 2023, orders for brake discs for use in large motorbikes have increased in the US,
China, and Europe. The introduction of new brake pads and strong orders for high-grade aluminum
hub floating brake discs in China also contributed to growth in the segment.

Low outgassing sealant“Penguin Clean Seal”

Photo courtesy of KIOXIA Corporation

Expanded sales of silicon-based sealants in China
Sales of silicon-based sealants doubled in 2023, reflecting progress in productapprovals and business development. Technical exchanges with developers anddesign firms have accelerated the product approvals process. We also succeededin securing the specification of silicon-based sealant SR2518 and flame-retardantsealant SR2519 for use in a major construction project in South China.

Sunstar Group Report 2024 I 13

Growing sales of race-grade brake discs
in Japan and China
Sales growth in Japan and China was significant through the new products development. Our new
range of EPTA discs, integrating Japanese race-grade brake disc technology and Sunstar European
brand BRAKING, intended for racing use, have been welcomed by motorbike enthusiasts in Japan.
We also began selling 10 aluminum hub floating brake disc product variants in China.

Indoor air quality improvement business

A “Global Excellence Award”
from Yamaha Motor

Expanded customer contact points lead to sales growthamong Japanese pet owners

Sunstar received a “Global Excellence Award” from Yamaha Motor, a major
customer for motorbike brake discs and sprockets (a gear component). Thisaward recognizes suppliers for demonstrating excellence in both quality andbusiness activities, including the horizontal deployment of quality improvement
measures across global businesses.

Sales of our pet deodorizing system QAIS-air-04 haveincreased following an expansion of customer contact
points, including online retailer listings, attendance at
pet expos, and the installation of display units at
pet-friendly hotels and home centers. The release of
a dedicated stand for the product (for those who
cannot wall mount the unit) has also helped increase
adoption.

Increased orders for metal partsfor use in vehicles in Thailand and Indonesia
Sunstar experienced an increase in orders for automotive parts produced by its
fine blanking and high-speed press facilities. These orders can be attributed to
improvements in die machining technology and also helped us secure newcustomers in Europe and the US.

Industrial Business

Material Core

E-Science

Ground-breaking pet deodorizer received
an award for innovation
In Spring 2023, we launched our QAIS-air-04 pet
deodorizer product in the U S and China. The
ground-breaking productsubsequently won Cleaner
and Deodorizer Product of
the Year at the 2023 Pet
Innovation Awards.

Sunstar Group Report 2024 I 14

ESG Environment
The table below shows progress toward our Mid- to Long-Term Environmental Targets
during FY2022＊. Major environmental initiatives from FY2023 are highlighted on the next page.

Well-being & ESG

Initiatives

Progress towards Sunstar Group’s Mid- to Long-Term Environmental Targets
2030 target

Achieved, 2021 Achieved, 2022

Plastics in containers and packaging:increase in plant-based/recycled plastic usage rate

50%

5%

6%

Used containers and packaging:increase in percentage of recyclable/
reusable material usage

100%

73 %

68 %

Paper used in containers and packaging:increase in usage rate of FSC ®
certified or other certified paper products

100%

53 %

70 %

Palm oil usage in products:
increase in ratio of RSPO certified
or other certified renewable palm oils

100%

9%

14 %

Energy use in own plants and offices:increase proportion of renewable(CO2-free energy) energy

100%

26 %

27%

Water usage in own plants:
reduce volume of water usage
per production volume compared to FY2020

-20%

1%

9%

-85%

-22%

-21%

Sunstar’s recent progress toward environmental and social goals

For more detailed information, please visit the Sunstar website:
https://www.sunstar.com/sustainability

CO2 emissions in own plants:
reduce volume of emissions (scope 1+2)
compared to FY2020

CO 2＊Figures for FY2023 are still being compiled and validated.

Sunstar Group Report 2024 I 15

Well-being & ESG Initiatives

Major initiatives in FY2023● Measures to reduce the environmental impact of containers and packaging● Employee-led biodiversity initiatives

In Europe, Sunstar has introduced product packaging that uses at least 70% recycled materials; 53%
of GUM brand sales in 2023 were of products using this new packaging. Meanwhile, in Japan, we havemade the switch from oil-derived plastics to a 30% plant-based biomass PET (polyethylene
terephthalate) in bottles used by 13 of our liquid toothpaste and mouth rinse products. This move will
help reduce the volume of oil-derived virgin resin used in our products, reducing our CO2 emissions.

Sunstar employees have taken the lead in promoting biodiversity initiatives around the world; German
factory have donated for organizations focused on forest conservation, mangrove trees have been planted
by Indonesian team members, and Thai employees have planted trees within the factory grounds.

Indonesia

Thailand● Sunstar factories benefit from solar power expansion● Waste reduction initiatives

Sunstar has installed solar panels at our Industrial Business factories in Germany and Singapore, in addition
to our Consumer Business factories in Germany and Japan. The 910 panels at our German factories and880 panels at our Singapore factories are sufficient to provide 30%-50% of the facilities’ energy
requirements. We are continuing to increase the proportion of self-generated and renewable energy used
across our businesses as part of our efforts to further reduce the environmental impact of our operations.

In Japan, Sunstar has identified the opportunity to recycle plastic trays used in our toothbrushmanufacturing process which have become degraded due to repeated use. Meanwhile, our factory inThailand now collects used PET bottles and caps for processing and use as recycled materials.

Germany (Industrial Business)Japan

Singapore (Industrial Business)

Thailand

Sunstar Group Report 2024 I 16

Well-being & ESG Initiatives

ESG Human Resources
Sunstar is progressing its efforts to develop internal talent that meet new business demands
and build an organization that embraces diversity worldwide● Improving individual and organizational well-being

SunstarGlobal HR Mission Statement

In January 2023, Sunstar Group defined its “Sunstar Global HR Mission Statement,” which is intended to improve employee well-being and help the businessrealize sustainable development. The policy outlines a shared global HR management vision and functions as the foundation for all HR policies across thegroup. We are determined to put in place HR management that generates value.

［ HR Vision ］
1.Create a vibrant work environment where
employees are highly motivated and that is
comfortable to work in
2. Create a team that respects diverse values andcontinues to evolve with changes● Supporting the transformation to a highly competitive autonomous professional team［ HR Mission ］
3.Enhance the well-being of individuals andorganizations
4. Support the transformation to highly competitive
and autonomous professional team
5.Promote teamwork management that brings
diverse strengths of individuals together［ HR Strategy ］
6. Enhance engagement
Maximize employee engagement by pursuing
comfortable work environments and rewarding work
7. Enhance organizational and individual competencies
Support employee driven their career development,
developing the expertise of each employee, andrealizing the growth of the organization
8.Drive transformation
Draw out the potential of a diversit y ofindividuals, and thoroughly implementing humanresource management linked to businessstrategies, leveraging successor training plans

Sunstar Group Report 2024 I 17

Sunstar has introduced an e-learning platform to support employee development in Europe, North America, and Japan.
The platform provides a variety of educational content, creating a program that allows employees to independently
develop their skills to support their career development. In addition to the optimization of operations and cost-reduction
measures, business transformation is being accelerated through digital transformation initiatives, such as the Sunstar
Summit. We are also encouraging cross-region deployments for trainees and greater HR networking.
● Promoting teamwork-oriented management and greater diversity

Our “Sunstar Connect” event in Europe every year is designed to deepen mutual
understanding between corporate cultures and encourage greater and deeper
communication between international teams. For International Women’s Day, we hosted
a breakfast conference in Switzerland to exchange views on issues facing female
employees in the workplace. Workshops in Singapore have also helped to promotemutual understanding between Japanese and local cultures; this program has also
used in Bangkok and Jakarta for new employees from 2023.

Switzerland

Singapore● Improving employee health and performance

Sunstar has implemented programs to enhance the mental and physical well-being of its
employees globally. Pilates lessons are hosted weekly in Switzerland, while German employees
can attend sporting events and have access to exercise videos. Daily “Sunstar physicalexercises” continue to be a fixture in Japan, with instructors directing
participants on how to improve leg and lower back fitness, complemented
by seminars for women’s health issues. These initiatives have been
integral to Sunstar subsidiaries in Japan being certified as an outstandingorganization for Health & Productivity Management for the seventh yearJapanrunning, and in 2023 we entered the top 500 ranking of companies.

Switzerland

GermanyWell-being & ESG Initiatives

ESG Partnership
Sunstar supports health initiatives in local communities, promoting dental and oral care,and using research to help increase awareness of the relationship between oral care and whole body health.

● Humanitarian support and disaster relief● Contributing to our local communities

Sunstar in Germany has donated oral care products to people displaced by conflictand natural disasters, including Ukrainian children. In China, we donated mouthrinses to help protect the health of medical personnel working at over ten medical
institutions as they dealt with the Covid 19 pandemic, while also promoting theimportance of routine oral care. In Japan, a portion of the sales of the Hairspray was
donated to medical professionals.

Employees in the US grew food in the factory grounds for donation to local food banks. A partnership with the non-profit
Mexican Diabetes Association allowed us to support low-income diabetics and their families through workshops andmedical care.

USA

Japan

Germany

Mexico● Promoting better dental and oral care,and raising awareness of the link between oral care and general health

China

China

For 22 years, the Sunstar/RDH Award of Distinction, organized by Sunstar USA and the dental industry magazine, RDH, hasbeen recognizing outstanding work by dental hygienists. The Sunstar Foundation’s partnership with the World HealthOrganization (WHO) helps improve access to dental care products for people in developing countries. The foundation donated120,000 toothbrushes to the Republic of Palau in the Western Pacific in 2023, and will help test the effect of brushing
instruction in elementary schools across the country. Each year, the Sunstar Foundation also awards the Hiroo Kaneda
Research Grant research grant to young scientists who are engaged in investigating the connection between oral care andwhole health. In 2023, the grant was given to two promising young scientists.

In Indonesia, we have helped provide clean
drinking water to regions impacted bydroughts caused by climate change.

Indonesia

USA

Japan

Sunstar Group Report 2024 I 18

Published by Sunstar Group Global Public Relations www.sunstar.com