May 8, 2024
Lion Corporation

Analyst Q&A (Summary)First Quarter Ended March 31, 2024

Q1: How do the results for the first quarter compare to the plan?
A1: Overall, progress is advancing as planned. Although overseas results exceeded
expectations, Industrial Products struggled due to customer inventory adjustments. In
Consumer Products, although the situation varies by product category, overall
performance is progressing as planned. Excluding foreign exchange rate fluctuations,consolidated net sales decreased by 0.2%, but net sales increased by 0.7% whenexcluding the foods with function claims business, which was discontinued in 2023.
Q2: The top line in Consumer Products appears weak, can you comment?
A2: Overall growth has slowed slightly due to efforts to manage sales promotion expenses
for low-end products and other factors, but figures are still within the expected range. InFabric Care, sales of fabric softeners are meeting with short-term difficulties due to theimpact of price offensives from competitors. Overall, however, we are on track toimprove the profitability of Consumer Products.
Q3: Can you elaborate on the progress you have made on improving the profitability ofConsumer Products?
A3: Through price shifting and changes in the value-added composition of products, weincreased overall prices approximately¥1 billion in the January-March period on a yearon-year basis. From April, we plan to increase shipping prices for some products, withan eye to raising overall prices ¥4 billion for the full fiscal year. We are monitoring thebalance of and proceeding with reductions in the number of SKUs in order to facilitate
short-term inventory disposal. We have already decided to separate our business fieldsby transferring two pharmaceutical product brands, and will continue to consider ouroptions moving forward.
Q4: You mentioned that business overseas is growing faster than planned, do you expect
such conditions to continue in the future?
A4: Although we expect the rate of sales growth to slow compared to the first quarter, wedo believe that it will continue to grow over the course of the year. In particular, webelieve we will achieve growth in Thailand by growing sales in the personal care field inrural areas and in China by expanding our sales areas.
Q5: It was previously forecasted that the year-on-year annual increase in competitionrelated expenses would be ¥1.5 billion, but it actually increased by ¥1.7 billion in thefirst quarter. Can you please explain the discrepancy?
A5: Sales promotion expenses are increasing due to higher-than-expected sales growth inoverseas business. Competition-related expenses are increasing, especially in China,
as forward-looking investment to expand the sales area progresses. Nevertheless, wewill manage the entire segment to ensure increased profits.
Q6: How do you view the current raw material prices and exchange rates?
A6: Because it takes some time for changes in raw material prices and other factors to bereflected in Lion’s business results, we are assuming a risk of several hundred million
yen in the second half of the fiscal year; however, we also believe that we will be able tooffset this risk with cost reductions and revisions to the sales mix.
Q7: What is the breakdown for the core operating income consolidated adjustment, seeing
as it remains unchanged from the first quarter of 2023?
A7: Unrealized profits on transactions within the Group have increased, mainly due toincreased inventories. Although we have started reducing inventory levels to improvebusiness efficiency, overall levels are still high, and we recognize that we need tocontinue working towards reducing these levels.

Disclaimer
The contents of this document comprise a summary of the views of the Company expressed during
the question and answer portion of a quarterly financial results presentation. This document does
not guarantee the accuracy or completeness of the information contained herein and is subject tochange without notice. Furthermore, forecasts, results projections and other forward-looking
statements are based on certain assumptions judged by the Company to be reasonable in light of
information available at the time of preparation and do not constitute promises or guarantees.
Please be advised that a wide range of factors may cause actual results to differ significantly fromthe forward-looking statements made herein.