HOKKAN GROUP
Fiscal Year 2022-2026 VENTURE-5
Medium-Term Business Rolling Plan
May 12, 2023

Rolling Plan of the Medium-Term Business Plan VENTURE-5
Our group has established the VENTURE-5 in May 2022 and we have engaged in achieving
the target of the first year. However, though having positive changes such as recovery trend
from the COVID-19 pandemic, there were severe business environment changes such asenergy cost surge following the prolonged Ukraine issue, and raw material cost surge beyond
assumption following the lowering of Japanese Yen, which we cannot overlook this situation.
Additionally, our container business segment has discontinued the business of beverage cansand the precondition of the business plan has greatly changed in one year.
Therefore, considering the business performance of fiscal year 2022, we have decided to review
our plan for the fiscal year 2023 to 2026.
Though it is forecasted to take a while until the business to recover and meeting the market
expectation due to the external business environment downturn, our group will come together toimplement our company-wide strategy and achieve the medium-term plan.
Kosuke Ikeda
President and Representative Director
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VENTURE-5 Fiscal Year 2022 Review (1) Company-Wide Strategy
In VENTURE-5, we have set global business expansion, restructuring of domestic business, new businessdevelopment, and optimization of human resources as the major points of the company-wide strategy of ourgroup. In fiscal year 2022 which is the first year of VENTURE-5, we have worked on below measures.
Company-wide
strategy

Global businessexpansion

Measures-

Decision of establishing new factory of Hokkan Deltapack Industri
Consideration of investment for other overseas business-

Discontinue beverage can business of Hokkai Can and review ofbusiness plan
Review business portfolio and reporting segment considering the futureof the GroupNew businessdevelopment-

Research on start-up enterprises for new & related business domain
Research and consideration on different industries

Optimization ofhuman resources-

Intensify mid-career recruitment
Diversification in human resources
Selective Appointment System of human resource

Restructuring ofdomestic business

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VENTURE-5 Fiscal Year 2022 Review (2) Business Performance＜Group Consolidated Profit/Loss＞
FY2021
Actual(million JPY)

FY2022
ActualYoY
Difference

Net sales

86,32993,660+7,331

Operating profit/loss

1,324

△ 456

△ 1,780

Operating profit ratio

1.5%

-

Debt

55,43343,027△12,406

Equity57,02954,880△2,149

1.0

0.9

-

ROE

△2.3％

△3.9%

-

Equity to Asset Ratio

37.2%

39.2%

-

Debt equity ratio＜Profit/Loss by segment＞

FY2021
Actual-■ Increment of net sales factor• COVID-19 activity restriction ease, population flow
recovery• Partial product price increase following material andenergy cost increase.

■ Operating profit/loss worsening factor• Increase of raw material and energy cost

■ Decrease of debt
• Repayment of long-term bank borrowing following
property sales of container business(million JPY)
FY2022
ActualYoY
Difference

Container business△ 631△ 1,289△658

Filling business

3,011

1,652

△1,359Machinery business

△ 142

△ 27

+115

Global business

791

774

△17

Others

△ 46

92

+138

Container Business: Raw material & energy cost surge
increase
Filling business: Energy cost increase
Global business: Raw material & energy cost surge
increase3

VENTURE-5 Fiscal Year 2023 Plan
＜Group Consolidated Profit/Loss＞
FY2022
Actual(million JPY)
YoY
Difference

FY2023Plan

Net sales

93,66095,000+1,340Operating profit/loss

△ 456

2,400

+2,856

Operating profit ratio

-

2.5%

-

Debt

43,02740,000△ 3,027

Equity54,88056,000+1,120

0.9

0.8

-

ROE

△ 3.9%

2.6%-

Equity to Asset Ratio

37.2%

40.3%

-

Debt equity ratio＜Profit/Loss by segment＞
FY2022
Actual■ Increment of net sales factor• Increment of global business sales■ Improvement of Operation Profit factor• Realization of fair price• Decrease depreciation due to container business impairment• Human resource planning for container business, productivity
improvement by factory consolidation(million JPY)
FY2023
Plan

YoY
Difference

Container business△ 1,289

1,000+2,289Filling business

1,652

800

△ 852

Global Business

774

1,400

+626

Others

65

100

+35

Container business: decrease production cost, realize fair price,decrease depreciation cost
Filling business: Energy cost increase
Global business: Firm market recovery, obtaining newcustomer and new product※ Machinery business is included in “Others”

4VENTURE-5 Fiscal Year 2022-26 Consolidated Numerical Rolling Plan
Considering the fiscal year 2022 result and 2023 budget, we prepared the rolling plan as below.
(million JPY)

FY2022
ActualFY2023Plan

FY2024Plan

FY2025Plan

FY2026Plan

Net sales

93,66095,00098,000101,000

105,000

Operating profit/loss

△456

2,400

3,500

4,700

6,100

Operating profit ratio

-

2.5%

3.6%

4.7%

5.8%

Debt

43,02740,00040,00040,00036,000Equity54,88056,00057,00059,00062,000

0.9

0.8

0.8

0.7

0.6

ROE

△3.9%

2.6%

3.8%

5.3%

6.5%

Equity to Asset Ratio

39.2%

40.3%

40.9%

39.7%

42.3%

Debt equity ratio

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VENTURE-5 Business Segment Operating Profit Rolling Plan
Considering the fiscal year 2022 result and 2023 budget, we prepared the operating profit rollingplan per each business segment as below.
(million JPY)

FY2022
ActualFY2023Plan

FY2024Plan

FY2025Plan

FY2026
Plan

Container business△ 1,289

1,000

1,200

1,600

1,700

Filling business

1,652

800

1,400

2,000

3,100

Global business

774

1,400

1,600

1,800

1,800

Others

65

100

200

300

400

※Operating profit in each segment includes profit from the group internal transaction.
※Container Business ：Hokkai Can, Tohto Molding, Showaseiki※Filling Business：Nihon Canpack, Kujirai dairy, Maki Food

※Global Business：Nihon Canpack Vietnam, PT.Hokkan Indonesia, PT.Hokkan Deltapack Industri※Other Business：OS Machinery, KEOS Machinery, Work Service, Cosme Science※ Machinery business is included in others
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VENTURE-5 Business Segment Investment Plan
We have prepared the rolling plan for investment within the period of fiscal year 2026
as per below.
(million JPY)

Container

FillingGlobalOthers

M&A

Total

Rolling Plan

7,000

23,500

4,500

1,000

5,000

41,000

Original Plan

4,500

22,500

3,500

500

5,000

37,000

Increment from original plan: Container business facilities relocation cost

※Container Business ：Hokkai Can, Tohto Molding, Showaseiki※Filling Business：Nihon Canpack, Kujirai dairy, Maki Food

※Global Business：Nihon Canpack Vietnam, PT.Hokkan Indonesia, PT.Hokkan Deltapack Industri※Other Business：OS Machinery, KEOS Machinery, Work Service, Cosme Science※ Machinery business is included in Other Business.

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VENTURE-5 Consolidated KPI (1)Operating Profit
FY 2026

6,100
Millions of Yen

Operating Profit Ratio
FY 2026

5% or more

Following the former medium-term business plan, ourgroup sees operating profit as the most important KeyPerformance-Indicator.
Although operating profit is expected to decline in thefirst half of the period due to the impact of worsening
external environmental factors such as rising energy
costs, we will aim for a profit recovery in the second
half of the period by steadily implementing companywide strategy. Additionally, with discontinuing thebeverage can business, we seek recovery of operating
profit.

Regarding operating profit ratio, our group sets 5%
or higher as the target. By taking measures such asincreasing cost competitiveness in the container
business, pursuing effective production in the fillingbusiness, and enhancing productivity in the global
business, our group aims for the higher profit ratio.

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VENTURE-5 Consolidated KPI (2)Considering the temporary decline of profit-capability, andDebt to Equity Ratio
FY2026 Target

0.6

to maintain financial soundness against future possibility ofrise in interest, we have applied the fund from property
sales of container business to repayment of bankborrowings. Therefore, we target 0.6 as our numericaltarget for the DE Ratio.

or lower

Return on Equity
FY2026 Target

6.5％

Regarding Return-on-Equity ratio for FY2026, ourgroups sets 6.5% as the target. We will achieve thetarget by securing the financial soundness and therecovery of operating profit.

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VENTURE-5 Rolling Plan, Share Related KPIShare Related KPI(Additional KPI)FY 2024

Realization ofdividend increase
FY 2026

Annual dividend
100 JPY or more

In order to improve the value, we will focus onshareholder return more than before.
Specifically, the consolidated dividend payout ratio during
VENTURE-5 period shall be equal or more than 35% andthe minimum amount of annual dividend shall be 45
Japanese Yen.
Due to the external business environment downturn, it isforecasted to take a while until the business to recover andmeeting the market expectation. However, please continue
to hold our shares at ease with above policy while weachieve the VENTURE-5 and can realize the raise ofdividend on fiscal year 2024 and aim for annual dividend
amount 100 Japanese Yen or more on fiscal year 2026.

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＜Appendix＞
May 2022
Medium-term Business Plan
Venture-5 Extract

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Mission

Since its birth in Otaru, Hokkaido, Hokkan Holdings Group has been in business for 100 years,
and as we enter the next 100 years, we have decided to revamp our mission to express our target
more clearly. We have formulated this plan with our thoughts and feelings about what we ourselves
have been and what we should be in the future.

Mission: With a frontier spirit, we will enthusiastically continue totake on challenges for growth, and, together with ourcustomers, we will provide products needed by society.

12VisionOur mission is the target for the next 100 years and our vision expresses what ourgroup should be like in the year 2030.
1. Strongly in demand by our business partners and society, we will develop andprovide products and services with outstanding features that can be clearly statedto be "No. 1 in this respect" in each business field.
2. We will eagerly keep on establishing new business bases so that we can offer our
products and services to people around the world.
3. We will continue to be a group that fairly assesses our staff members contributing
to our business regardless of nationality, gender, or age.

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Basic Sustainability Policy
In order to realize our mission and vision, we have formulated our basic sustainability policy, which
expresses our basic corporate stance and principles of action. In order to continue to grow in each of
our business field and improve our corporate value over the medium to long term, we are deeply
aware that our activities must be sustainable and in harmony with the environment and society, andto put this into practice, we will actively work to resolve various social issues that are directly or
indirectly related to our business activities.
We have established a new basic sustainability policy, as well as an environmental policy, amanufacturing safety policy, an occupational health and safety policy, and a sustainability
procurement policy, and have set a new climate change action target to achieve carbon neutrality by
2050.

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VENTURE-5 Company-Wide Strategy
In order to realize our mission and vision, we have formulated a company-wide strategy as amean to ensure that our group works as one team and implements it.
１. Optimization of human resources
To optimize human resources, which is the company’s source of growth, we will establish
appropriate personnel and education systems and actively invest in securing humanresources that can contribute to value creation.
２．Restructuring of domestic businessWe will work to select businesses placing the utmost importance on whether or not
we can provide high value to our customers.
３．Global business expansion
We will accelerate business investment in emerging countries, especially in Southeast Asian
countries, aiming to expand the scale and profits of our business.
４．New business development
We will actively utilize M&A to expand into new business areas globally where we can takeadvantage of our group's knowledge and expertise.
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VENTURE-5 Container Business/Hokkai Can Management Policy【Management Policy】
・Executing new measures in the fields of material, function and business scheme
responding to the global trend of transition to decarbonized society.
・Recognizing social issues like “climate change” and “depletion of natural resources”
as our critical issues to be solved and proactively taking measures.
・As for food containers, taking measures contributing to “food safety” and “reductionof food loss and waste”. As for non-food containers, providing ones enhancing
functionality for supporting everyone’s daily life.
【Business Strategy】
・Maintaining the current sales level through developing new containers and reducing
manufacturing cost.
・Taking measures in reduction of green-house gas, increase usage of recycled materials
and development of light-weight containers.
・Free from the existing markets and boundaries, sensing needs of rapid changing society
and developing new value-market and business schemes.

16VENTURE-5 Filling Business/Nihon Canpack Management Policy【Management Policy】
・Establishing eco-friendly manufacturing structure and aim to become an excellent company
accepted by customers, suppliers and local societies responding to the global trend oftransition to decarbonized society.
・Establishing a leading position as TOP contract packing company even in the maturingsoft-drink market in Japan.
【Business Strategy】
・Eco-friendly: Focusing on reduction of green-house gas and utilizing more clean energy.

・Product Volume：Focusing on increase of volumes through high-effective manufacturing.
・Smart Factory ：Realizing a manufacturing line with less man-power through digital solution.
・Human resource ：Focusing on staff members’ personalities and realizing good workenvironment where everyone can work lively.
・New Business ：Developing new business by catching needs arising out of changing society.
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VENTURE-5 Global Business Management Policy【Management Policy】
・Our group has been managing filling and container business in Indonesia and Vietnam.
Demand in ASEAN market is steadily recovering and will expand strongly in the near future.
Consequently, we will continue to invest and set new factories responding to the market
growth.

【Business Strategy】
・Our group has been expanding global business in the filling business mainly.
From now, in addition to filling business, we will aim for business expansion in the container
and the food fields.
・Our group has built factories in ASEAN mainly.
From now, we will surely expand in ASEAN and start study in other areas as well.
・Based on our new mission, “with a frontier spirit”, we will pursue business where we cancreate new market and provide new value, as well as expansion of sales and profit.

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NoticeThis document is made to inform investors of management and financial status of Hokkan Holdings Group.
Please understand following points.
-Financial forecast is made based on the estimate by our group.
Please understand that the financial result might be different from the estimate.
-Regarding investing, please decide by your own discretion.
-Please be careful that this document might contain misinformation due to inevitable force even though we pay
attention to its accuracy.

Inquiry:
Hokkan Holdings Limited
Management and Control Department
TEL:+81-3－3527－9690

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