Nippon Light Metal Holdings Co., Ltd.
Q&A Summary of Briefing on Financial Results for the First Quarter of the Fiscal Year Ending March31, 2025
・Date: 5:00-5:40 pm; July 31, 2024 (Wednesday)
・Briefers and respondents:
Hiroyuki Matsudaira, Director and Senior Executive Officer
Haruhiko Takahashi, Officer and Accounting Manager of Corporate Personnel
Administration Office
Koichi Isshiki, Head of Planning Administration Department
Masahiro Amaya, Accounting Manager of Corporate Personnel Administration OfficeQ1.

The operating profit forecast for the first half of fiscal 2024 was revised upward from the 5.5billion yen forecast released in May to 8.0 billion yen in this July forecast, with profit expected
to increase in three of the four segments (i.e. the aluminum ingot and chemicals, the aluminum
sheet and extrusions, and the aluminum foil, powder and paste segments). What are the factors
behind this?

A1.

Factors behind the increase in profit forecast are primarily as a result of the strong sales ofprocessed foil for medical applications, particularly in India, in the aluminum foil, powder andpaste segment (Aluminum Foil Business Group), and the relatively solid effect of increased
sales in the Chemicals Business Group belonging to the aluminum ingot and chemicals segment.
In addition, looking at the aluminum sheet and extrusions segment (Sheet & Extrusion BusinessGroup), the Aluminum Sheet Division expects a slight increase in sales volume compared to theforecast we released in May, despite it taking some time for sales of thick-gauge plates forsemiconductor manufacturing equipment to fully recover, while the Extrusions Division alsosees an upturn in sales of products for semiconductor manufacturing equipment. The upward
trend in aluminum ingot prices in 1Q is also a contributing factor.

Q2.

How much will higher aluminum ingot prices affect the company's business performance?

A2.

In the range of one to two billion yen (in 1Q). In 2Q, however, we are keeping a close watch onvolatile price movements, including the downward trend in aluminum ingot prices, in contrast
to 1Q.

Q3.

You left the full-year earnings forecasts unchanged from those released in May. What is yourview of the earnings forecast for the second half of the year?

A3.

The second-half forecast is slightly weaker than what we released in May, reflecting such factors
as softening aluminum ingot prices as we moved into July, uncertainty about market price trends,
1and the fact that each business group is taking a harsher view of the external environment.
Q4.

The aluminum foil, powder and paste segment (Aluminum Foil Business Group) seems to havestalled a little in 2Q compared to 1Q. What lies behind this?

A4.

We have slightly lowered the demand forecast for 2Q from the forecast released in May, due
to the fact that aluminum ingot prices are on a weak trend in 2Q and that the inventory
adjustment of the Aluminum Foil Division's foils for automotive lithium-ion battery exteriors
is still underway.

Q5.

The first-half and full-year earnings forecasts are for an increase in profit in the aluminum
sheet and extrusions segment, but for a decrease in profit in the fabricated products and others
segment. What changed the outlook for these two segments?

A5.

I would like to note that as a result of the reclassification of segment components effective thisquarter, the automotive parts business, which was previously under the aluminum sheet andextrusions segment, has been consolidated into the Automotive Parts Business Group(Nikkeikin Aluminum for Mobility Company, Ltd.) under the fabricated products and others
segment. Accordingly, the presentation of earnings in the two segments has been changed (i.e.
the fiscal 2023 results and the forecast released in May of fiscal 2024, which are provided inthis briefing material, also restate the figures calculated to reflect the segment reclassification).
The changes from the May forecast are based on a harsher view of the China and U.S.
businesses in the Automotive Parts Business Group (Nikkeikin Aluminum for Mobility
Company, Ltd.).

Q6.

Do you expect the solid performance in the aluminum foil, powder and paste segment tocontinue in the second half of the year and beyond?

A6.

The Aluminum Foil Division, the Powder and Paste Division and the Household Products
Division all performed solidly in the first half of the year. However, the outlook for automobile
paint products, and foils for automotive lithium-ion batteries in the automotive sector isweakening in the second half and beyond, and we have factored in a slight slowdown in the first
half.

Q7.

In your view, how does the business environment for automobile and semiconductor-related
businesses differ between the forecasts released in May and the one this July?

A7.

The business environment for the automobile-related business, particularly the Automotive
Parts Business Group (Nikkeikin Aluminum for Mobility Company, Ltd.), has worsened
slightly from the forecast we released in May, both in Japan and overseas. In Japan, newproduct launch schedules were pushed back due to the delay in the shift to EVs. Overseas, our2forecasts reflect the difficult situation in terms of earnings, including the level of the burden offixed costs, given the fact that the new U.S. plant has only just started operations, although its
capacity utilization has risen to about 80% after shifting to mass production, in addition to theimpact of the sluggish performance of Japanese automakers in China. In addition, we also seea weak demand for sheet materials for automotive lithium-ion battery cases handled by theAluminum Sheet Division.
With regard to the semiconductor-related business, we expect sales of products forsemiconductor manufacturing equipment to begin to recover in the second half of the year,
primarily for thick-gauge plates in the Aluminum Sheet Division. On the other hand, over thepast two years, the Panel System Division of the Engineering Business Group enjoyed solid
sales in the clean room field for semiconductor-related manufacturers, backed by strong
demand. However, the company's view of the business environment is slightly uncertain as
sales are slowing down in 1Q and the first half of the year, partly due to delays in construction
periods and revised investment timelines caused by rising material costs and labor shortages.
Q8.

The demand began to increase in the periods from 1Q to 2Q for the Aluminum Sheet Division'ssales of thick-gauge plates for semiconductor manufacturing equipment. Is this correct?

A8.

Our current view is that the demand will begin to increase after the second half of the year. Infact, sales volume in the recent periods (1Q and first half) increased compared to the same periodof the previous fiscal year, but we do not yet see this as a full recovery of demand.

Q9.

How will an upswing in aluminum ingot prices affect the earnings recovery of the Transport
Equipment Business Group (Nippon Fruehauf)?

A9.

There is no formula for automatically passing through changes in aluminum ingot prices to sales
prices as in the case of the Sheet & Extrusion Business Group (Aluminum Sheet Division andExtrusions Division), and for Nippon Fruehauf, the increase in the aluminum ingot price will
directly add to the cost of the product. In response, Nippon Fruehauf will continue their efforts
to pass on the portion of the cost increase in sales prices and to correct prices and is aiming fora solid return to profitability in the second half of the year.

Q10.

In your view, how does the business environment for the Panel System Division of theEngineering Business Group differ between the forecast released in May and the one this July?

A10.

In general, there is no difference or change in our view. However, in the recent periods (1Qand first half), rising material costs and labor shortages have caused delays in construction
periods and revisions of investment timelines in large projects for food factories and lowtemperature distribution warehouses and others. As a result, the 1Q results and first halfearnings forecasts were down from the previous year’s levels. Looking ahead to the second3

half of the year, although there is some uncertainty, we do not expect a major deviation fromour earnings forecasts released in May, as the level of orders received remains high andmeasures are being taken to secure a greater number of projects.
Q11.

How will you review the China business of the Automotive Parts Business Group (Nikkeikin
Aluminum for Mobility Company, Ltd.)?

A11.

Under the premise of “local production, local consumption,” which is our basic overseas
business policy, we will look into a framework that is tailored to local needs. With the current
progress of Chinese EV manufacturers, it is our view that now is the stage in which we needto closely monitor the policies and trends of Japanese automakers, our main customer base,and then we will consider the company’s future direction.

*This document has been translated from the Japanese original for reference purposes only. In the event of any discrepancy
between this translated document and the Japanese original, the original shall prevail.

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