Financial Results
for the Fiscal Year Ended March 2021

FP Corporation
May 7, 2021
FP Corporation

・Cautions for Handling This Material

We have paid extremely close attention to the information provided and contained in the handouts. The forward-looking
statements included in the information are our estimates based on the information available at the time of publication, andtherefore contain potential risks and uncertainties.
Therefore, changes in a number of factors could cause actual results to differ materially from the future prospects
described.
Information contained in the handouts for this session must not be quoted, reprinted or copied without our priorpermission.
FP Corporation

・= Table of Contents =◆ Results and Plan
Executive Vice President and Director,
Executive General Manager of Finance and Accounting Division

Isao Ikegami... 4◆ For Expansion of Corporate Value
President◆ Supporting Data

Morimasa Sato . . . 14

. . . 75

FP Corporation

・Financial Results
for the Fiscal Year Ended March 31, 2021

Executive Vice President and Director,
Executive General Manager of Finance and Accounting Division

Isao Ikegami

Financial Results Summary(For the FY Ended March 2021)✔ Highest sales ever for the eleventh consecutive year

Record high ✔ Operating profit, ordinary profit, and profit attributable to ownersof parent grew for the third consecutive year
Results for Full year
FY ended March 2020

Unit: m illion y en

Performance

Percentage

FY ended March 2021
Performance

Percentage

Increase/decrease

Year-on-y earQuantity

Full year
projections(original)

Full year revised
projections(Oct.30)

Full year revised
projections(Jan.29)

FY ended March 2021

FY ended March 2021

FY ended March 2021

Planned

Percentage

Progressrate

Planned

Percentage

Progressrate

Planned

Percentage

Progress
rate

Trays

36,263

19.5

40,635

20.6＋4,372112.1%

111.2%

37,77519.9

107.6%

40,37020.7

100.7%

40,62620.7

100.0%

Lunchboxes andprepared food containers

103,54155.6

108,726

55.2＋5,185105.0%

105.5%

105,53055.5

103.0%

108,08755.4

100.6%

108,21255.2

100.5%

Subtotal

139,804

75.0

149,36275.8＋9,557106.8%

107.5%

143,30575.4

104.2%

148,457

76.1

100.6%

148,83875.9

100.4%

Other products

3,027

1.6

2,796

1.4

-230

92.4%

2,895

1.5

96.6%

2,743

1.4

102.0%

2,762

1.4

101.3%

104.1%

100.6%

100.4%

142,83176.6

152,158

77.3＋9,327106.5%

146,200

76.9

151,200

77.5

151,600

77.3

packaging materials

37,892

20.3

39,03019.8＋1,138103.0%

38,34020.2

101.8%

38,163

19.6

102.3%

38,72819.8

100.8%

Other goods

5,626

3.0

5,761

2.9

＋135

102.4%

5,460

2.9

105.5%

5,637

2.9

102.2%

5,672

2.9

101.6%

Sales of goods

43,51823.4

44,79122.7＋1,273102.9%

43,80023.1

102.3%

43,80022.5

102.3%

44,40022.7

100.9%Net Sales ※186,349100.0

196,950

100.0＋10,600

105.7%

190,000

100.0

103.7%

195,000

100.0

101.0%

196,000

100.0

100.5%

Operating profit

15,507

8.3

18,7639.5＋3,255121.0%

16,7008.8

112.4%

17,5009.0

107.2%

18,5009.4

101.4%

Ordinary profit

16,274

8.7

19,381

9.8＋3,107119.1%

17,4009.2

111.4%

18,2009.3

106.5%

19,2009.8

100.9%

Profit attribute toowners of parent

10,777

5.8

12,211

6.2＋1,433113.3%

11,2905.9

108.2%

11,6906.0

104.5%

12,1006.2

100.9%

Ordinary profit before
depreciation and armotization

29,807＋3,184110.7%

Sales of products

32,991

31,29632,100105.4%

33,100102.8%

99.7%* Before the change of the revenue recognition standard◼Sales
Products
 Rise in demand for fresh food, home-delivered food andtakeout food following expansion of the stay-at-home
economy Strong sales of recycled Eco Trays
 Shift from buffet style to food items in containers

Goods Utilization of E-commerce site ”PACK MARKET”,
to expand sales of hygiene products, etc.

Year-on-yearProduct sales composition
Conventional
materials

Results as of the endof March 2021

Conventional materials
New products*

Original
Products

59％78％

1Q results 2Q results 3Q results 4Q results

Full year Full year
Full year
Full-year
revisedrevisedprojections
results
projections projections(original)(Oct.30) (Jan.29)

Sales ofproducts

107.2%

103.6%

107.6%

107.8%

106.5%

102.4%

105.9%

106.1%

Quantity

106.8%

104.9%

109.4%

108.7%

107.5%

103.0%

107.2%

107.2%

Ordinary
profit124.8%

108.2%

125.1%

117.4%

119.1%

106.9%

111.8%

118.0%

Ordinary
profit ratio

8.1%

9.6%

13.3%

7.7%

9.8%

9.2%

9.3%

9.8%

FP Corporation

・Increase/Decrease in Ordinary Profit

0

50.0

100.0

150.0

(For the FY Ended March 2021)

200.0

Unit: billion yen
FY ended March 2020

1st half 7.44

16.27

2nd half 8.83

The Price ofMaterial+1.40

Outlook(Jan.29)
Difference（1Q +0.40、2Q +0.70、3Q +0.30、4Q ±0.00）* Including the impact of naphtha-linked pricing on selling prices to customers

Sales Efforts

+1.70

+0.10

（1Q +0.50、2Q +0.22、3Q +0.55、4Q +0.43）

Year on year

Improved
Production+3.11
1 st half
2 nd half+0.20（1Q ±0.00、2Q -0.15、3Q +0.20、4Q +0.15）

Improvement+2.08
Labor cost
-1.71
Depreciation+0.05
Electric power charges +0.41
Freight costs
+0.05

+1.12
+1.99

Labor cost
Depreciation
Other

FY ended
March 2021

-0.56
-0.14
-0.17

Improved
Distribution+0.10（1Q -0.05、2Q ±0.00、3Q +0.10、4Q +0.05）

Group
Companies+0.58（1Q +0.08、2Q -0.15、3Q +0.47、4Q +0.18）

Expenses-0.87（1Q -0.17、2Q -0.26、3Q -0.15、4Q -0.29）

Total
1st half+0.08

2nd half

8.56

Full year

+0.18

10.82

19.38
FP Corporation・Capital Investments and R&D Costs(For the FY Ended March 2021)

Results for Full year
FY ended March 2021

FY ended March 2020

Unit: million yen

Full year projections

Performance

Increase /decrease

Performance

FY ended March 2021

Year-on-y ear

Planned

Progressrate

Tangible fixed assets

11,688

19,105+7,416163.5%

22,85083.6%

Intangible fixed assets

525

306

-219

58.3%

450

68.2%

Capital investments

12,214

19,412 +7,197

158.9%

23,30083.3%

13,532

13,609+76100.6%

13,900

97.9%

1,229

1,195

-34

97.2%

1,312

91.1%

Depreciation andamortization costs
Research anddevelopment costs
Major Capital Investments◇IndexUnit: million yen

Investment in original products:
Improving production capacity and quality of Eco APET products

Unit：billion yen

40.0

Total
investment

Ordinary profit before
depreciation and amortization

Plan in Results for Fullperiod
year
35.0
30.0

◆
◆
◆

Eco APET materials:Increase in the productivity (Kanto, Chubu)

676

676

370

Eco APET materials:Quality improvement by pelletizing（Chubu)

810

337

245

Eco APET products:

408

408

492

20.0

1,815

1,633

1,634

15.0

25.0

Reinforcement of the production capacity of molding machines

Land for the new plant and the distribution center of the◆ 兵庫新工場・新拠点配送センター土地

Acquired in May 2020

new facility in Hyogo
Investment corresponding to expansion of the sales quantity:
Stable supply, Efficiency improvement, Maintenance of working environment

5.0

◆
◆

Introduction of automation facilities
Reinforcement of the production capacity of

637

590

1,462

1,462

1,444

Conventional materials New products

◆
◆
◆
◆
◆

Kyusyu Distribution Center extension

Inaugurated in Sep. 2020

644

581

566

Fukuyama Distribution Center extension

Inaugurated in Nov. 2020

3,950

3,845

3,478

To be inaugurated in Sep. 2021

5,285

2,662

2,591

Group home

Inaugurated in Apr. 2020

195

93

88

Company dormitories for single employees

Inaugurated in Oct. 2020

435

388

379

1,874

1,426

532

378

Chubu Cross Dock Center extension

in Fukuyama

◆
◆

Molds
IT investments

Capital investments

10.0

9.0

12.5 12.4 15.0 20.2 23.3 23.3 21.0 29.8 14.0 12.2 19.4

'10/3

'11/3

0.0

'12/3

World’s first material
developed

'13/3

'14/3

'15/3

'16/3

'17/3

'18/3

'19/3

'20/3

'21/3

'22/3
Plan

Microwave market expanded
Distribution network
constructed

Soaring cost of regular cargo services
Recyclingstrengthened

ESG investments
increased
Distribution network enhanced

Investment in human resources

FP Corporation・Balance Sheet(For the FY Ended March 2021)
Previous
consolidated
fiscal year

Consolidated fiscal year under review
FY ended March 2021

FY ended March 2020
Unit: m illion y en

As of March 31,2020

As of March 31,2021

Increase/decrease

Breakdown ofmain increases and decreases

Year-ony ear

Cash and deposits

Current assets

Noncurrent assets
Total assets

80,322

162,174
242,497

80,641

166,592
247,234＋318＋4,418＋4,736100.4%

102.7%＋2,537

Merchandise and finished goods＋832

Raw materials and supplies-838

Buildings and structures＋1,849Lands＋2,893

Accounts payable - trade＋1,875102.0%

Short-term loans payable

Current liabilities

Noncurrent liabilities

79,56978,527-1,042-2,403

Notes and accounts receivable-trade

98.7%

43,62643,726＋100

Total liabilities

123,196

122,253

-942

99.2%

Net assets

119,301

124,980＋5,679104.8%

Income taxes payable-5,612＋1,297

Short-term loans payable＋543

Provision for fire loss

＋220

Long-term loans payable＋205

Net defined benefit liability＋239

100.2%

Retained earnings＋5,801

T reasury shares

T ot al liabilit ies and net asset s

242,497247,234

Equity ratio

50.3%＋4,736Strategic investments for boosting the production capacity oforiginal products and ensuring stable supply

102.0%◇Changes in Net sales/Total assets
250 ,000■ Assets-522

Total assets

Unit: million yen

219,481
172,858

200 ,000

173,580

249,332

242,497 247,234

181,171

186,349

196,950

Non-current
assets

150 ,000

Net sales■ Liabilities Utilization of borrowing as capital for strategic investment

244,198

100 ,000■ Net assets Strengthening of the management structure
Preparation for expanding business flexibly

145,273

162,174

166,592

FP Corporation

・

163,075

164,684

50,0 000Cash Flows(For the FY Ended March 2021)
Results for Full year
Unit: million y en

FY ended March 2020
Performance

FY ended March 2021
Breakdown of main items

Performance

CF from operating activities

27,77031,814

CF from investing activities-10,989-19,131

Free cash flows

16,78012,682

CF from financing activities-15,643-15,086

Income before income taxes
Depreciation
Fire loss
Increase (decrease) in notes andaccounts receivable - trade

18,06013,6092,104-2,557Purchase of property , plant and equipment-17,319

Proceeds from long-term loans payable
Repayment of long-term loans payable
Repurchaseof treasury shares
自己株式の取得による支出

17,567-22,974-4,068-3,390Cash dividends paid

Net increase(decrease)in cash
and cash equivalents

1,136-2,403

Cash and cash equivalents
at end of period

20,28817,884■CF from operating activities
Ensuring profit by selling original products andstreamlining efforts■CF from investing activities
Strategic investment to construct the bases
to make a profit for future■CF from financing activities
Continuously stable dividend
Treasury shares acquired for improving capital efficiency and providing
shareholder returns《Dividend per share》
60.0

36.5%
30.2%

Unit：yen
33.8%

31.1%

50.0
40.0
30.0

40.0

40.5

20.0

20.5

40.5
20.5

20.5

40.5

20.0

20.0

20.0

20.0

30.1%
44.5

29.8%
47.0

24.0

25.5

20.5

21.5

20.0
10.0
0.0

37.0%
Dividend payout ratio
32.0%
27.0%
Dividend for the full
22.0%
17.0%
12.0%
Dividend for 2nd half
7.0%
2.0%
Dividend for 1st half
-3.0%

'17/3
'18/3
'19/3
'20/3
'21/3
22/3 Plan* On October 1, 2020, the Company implemented a two-for-one common stock split.
The indicated dividend amount is based on the assumption that the stock split was implemented at the beginningof the fiscal year ended March 31, 2017.

FP Corporation

・

Plan
for the Fiscal Year Ending March 2022

FP Corporation・Outline of Plan for Account Settlement
Unit: m illion y en

Results for Full year

Full year projections

FY ended March 2021

FY ending March 2022

Performance percentage

Plannedpercentage(For the FY Ending March 2022 )First half projections
FY ending March 2022

increase/

Year-ondecrease-year

Plannedpercentage

increase/

Year-ondecrease

-year

Trays

39,04620.8

41,22321.1＋2,176105.6%

20,03420.7＋1,039105.5%

Lunchboxes andprepared food containers
Subtotal

104,68155.8

109,08855.9＋4,406104.2%

54,661

56.5＋3,118106.1%

143,72876.7

150,31177.1＋6,582104.6%

74,69577.2＋4,158105.9%

Other products

3,058

1.6

3,088

1.6

＋30

101.0%

1,504

1.6

＋14

101.0%

146,786

78.3

153,400

78.7＋6,613104.5%

76,20078.8＋4,173105.8%

packaging materials

39,04320.8

39,90320.5＋859

102.2%

19,71320.4＋667

103.5%

Other goods

1,679

0.9

1,696

0.9

＋16

101.0%

786

0.8

＋7

101.0%

40,72321.7

41,60021.3＋876102.2%

20,50021.2＋675103.4%＋7,490104.0%

96,700100.0＋4,848105.3%

Sales of products

Sales of goods

Net Sales ※187,509 100.0

195,000 100.0

Operating profit

18,76310.0

19,60010.1＋836104.5%

8,780

9.1

＋468

105.6%

Ordinary profit

19,381

10.3

20,20010.4＋818

104.2%

9,100

9.4

＋535

106.3%

Profit attribute toowners of parent

12,211

6.5

12,9006.6＋688

105.6%

5,840

6.0

＋186

103.3%

Ordinary profit before
depreciation and armotization

32,991102.9%

15,890＋503

103.3%

33,960＋968*After the change of the revenue recognition standard/ After the reclassification of items

 Impact of the change of the revenue recognition
standard (fiscal year ended March 31, 2021)
Net sales

Sales commission

196,950

 Comparisons with the previous year's plan
1st halfplan

Net sales
Transactions made as a
trading company-3,985

Before(Million yen)After-9,441-5,456

187,509

2nd halfplan

Full-year
plan

Sales ofproducts

105.8%

103.3%

104.5%

Quantity

107.0%

104.0%

105.5%

Ordinary
profit106.3%

102.6%

104.2%

Ordinary
profit ratio

9.4%

11.3%

10.4%
FP Corporation・Outlook for Increase/Decrease in Ordinary Profit

0.0

50.0

100.0

FY ended March 2021

1st half 8.56

150.0

200.0

(For the FY Ending March 2022)
Outlook( Apr 28 2021)

19.38

Unit: billion yen

2nd half 10.82

The Price ofMaterial-1.80（1st half -0.80、2nd half -1.00）* Including the impact of naphtha-linked pricing on selling prices to customers

Sales Efforts（1st half +1.10、2nd half +0.80）

Year on year

+0.82
1 st half
2 nd half

+0.54
+0.28

+1.90

Improved
Production
Improvement
Labor cost
Depreciation
Electric power charges
Freight costs

+2.61
-1.17
+0.18
-0.07
+0.25

+0.70

（1st half +0.35、2nd half +0.35）

Improved
Distribution+0.50（1st half +0.25、2nd half +0.25）

Group
Companies+0.60（1st half +0.40、2nd half +0.20）

Labor cost
Depreciation
Other

FY endingMarch 2022

-0.27
-0.33
-0.48

Expenses-1.08（1st half -0.76、2nd half -0.32）

1st half outlook 9.10

2nd half outlook 11.10

Full year outlook 20.20
FP Corporation・Planned Capital Investment and R&D Cost

Unit: million yen(For the FY Ending March 2022)

Results for Full year

Full year projectionsFirst half projections

FY ended March 2021

FY ending March 2022

FY ending March 2022

Performance

Increase /decrease

PlannedIncrease /decrease

PlannedYear-on-y ear

Progressrate

Tangible fixed assets

19,10526,600+7,494139.2%

13,600+5,574169.5%

Intangible fixed assets

306

500

+193

163.0%

300+121

168.4%

Capital investments

19,412

27,100+7,687139.6%

13,900+5,696169.4%

Depreciation andamortization costs

13,60913,760+150

101.1%

6,790

-31

99.5%

Research anddevelopment costs

1,195

1,335

+139

111.7%

665+102

118.1%

Major capital investments◇Index

unit: million yen

Investment in original products:

Total
investmentPlanin period

1,135

1,135

793

73

Improving production capacity and quality of Eco APET products◆ Eco APET materials: Increase in productivity (Kanto, Chubu)◆ Eco APET materials: Quality improvement by pelletizing (Chubu)

Rebuilding of Chubu Plant 1◆ 中部第一工場建替え
New plant and the distribution center of the◆ 兵庫新工場・新拠点配送センター
new facility in Hyogo◆ Pico House No.5
◆ Molds◆ IT investments

To be inaugurated in Sep. 2021

20.0

Capital investments

10.0

1,222

1,222

625

625

Conventional materials New products◆ Chubu Cross Dock Center extension

25.0

15.0

224

◆ Reinforcement of the production capacity of

Unit：billion yen

Ordinary profit before
depreciation and amortization

35.0

30.0

Investment corresponding to expansion of the sales quantity:
Stable supply,Efficiency improvement,Maintenance of working environment◆ Introduction of automation facilities
Capacity enhancement for PSP products◆ PSP製品能力増強

40.0

5,285

3,290

To be inaugurated in May 2022

6,693

2,198

To be inaugurated in Sep. 2022

25,261

6,718

To be inaugurated in Sep. 2022

2,305

185
1,852
635

5.0

9.0

12.5 12.4 15.0 20.2 23.3 23.3 21.0 29.8 14.0 12.2 19.4 27.1

0.0

'10/3

'11/3

'12/3

World’s first material
developed

'13/3

'14/3

'15/3

'16/3

'17/3

'18/3

'19/3

'20/3

'21/3

'22/3
Plan

Microwave market expanded
Distribution network
constructed

Soaring cost of regular cargo services
Recyclingstrengthened

ESG investments
increased
Distribution network enhanced

Investment in human resources

FP Corporation

・To Increase Corporate Value
President
Morimasa SatoContents

・ Impact of COVID-19 Coronavirus
Market Conditions
・ Actions for Recycling and the SDGs
・ Logistics Network
・ Strategic Investment
・ Growth Strategy
15

Impact of COVID-19
Coronavirus
Market Conditions

Trend in Container Demand

Up

Down

Increased opportunities to cook at home

Ready-to-cook meat

Ready-to-cook fish

Safety and security of food

Increase in takeout and delivery

Snap-lock hood pack

Dedicated containers fortakeout and delivery use<Containers that are easy to open and close→ Addressing the labor shortage><Leak-proof/insulating>Items for picnics and events

Items fortrain lunches and meetings
17

Impact of COVID-19 Coronavirus: Retail Industry
Supermarkets

Convenience stores(Year-on-year changes in sales at existing stores)(Year-on-year changes at existing stores)

120.0%

120%
Prepared
food

110%

103.4% Fishery
99.4% products
98.6% Fruits and94.7% vegetables

100%
100％

Livestockproducts

90%

Averagecustomer spend

110.0%

105.6%

Sales (overall)

101.9%

100.0%
100％

Sales(daily foods)

99.6%
Customertraffic

90.0%

96.5%
80%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2020

80.0%

2021

Source: Japan Supermarkets Association

Wholesalers andsupermarkets

110%

Jan Feb Mar Apr MayJun Jul Aug Sep Oct Nov Dec Jan Feb Mar
2020

2021

Source: Japan Franchise Association

Sales of FPCO products
for the FY ended March, 2021
* Non-consolidated basis

Convenience stores

93%
18

Impact of COVID-19 Coronavirus: Takeout and Delivery
Food delivery service operator

Eating out:

26.0

Takeout

Approx.
trillion yen

Ghost restaurant(Delivery-only
establishment)

Partialtransfer

Home meal
replacement
10.3

Approx.
trillion yen

Takeout food market:
Approx.

880

billion yen

Delivered food market:
Approx.

330

billion yen

Source: Eating out: Japan Foodservice Association
Home meal replacement: Japan Ready-made Meal Association "Ready-made Meal White Paper"

Source: Fuji Keizai, Gaishoku Sangyo Marketing Binran 2020 (2020 Restaurant Industry Marketing Handbook),
2020 (Estimated values)

19Launch of New Takeout and Delivery Products
DLV Men

DLV Series shipment results

55 times

10,00044 times

9,000

higher than
March

8,000

47 times

higher thanMarchhigher than
March

7,000

6,000

14 times

5,000

higher than
March

4,000

3,000

Three-tier structure,
prevents noodles frombecoming soggy andrice from getting sticky

2,000

1,000

0

Oct Nov Dec Jan Feb Mar Apr May Jun Jul

Aug Sep Oct Nov Dec Jan Feb Mar

2020

2021
Apr. 27 to May 25
State of emergency (1)DLV Rectangular

DLV Rectangularbowl

DLV Oval

DLV Deli

DLV-BOXDLV LunchJan. 8 to Mar. 21
State of emergency (2)Leak-proof

Does not slide easily

Multiple sizes andshapes to choose from

Multiple colors andpatterns to choose from20

Container for Takeout Food Adopted by Toridoll(Marugame Seimen)

Takeaway service has enjoyed steady growth. With the expectation of generating ¥12billion of sales per annum, we are confident that it will become a new pillar of sales.
Overall, we have been maintaining a similar or better level of sales compared to that ofMarch 2020.

Mar.

Apr.

May

Jun.

Dine-in

Jul.

Aug.

Sep.

Takeaway

Delivery

Oct.

Nov.

Dec.

Source: Toridoll Holdings Corporation financial results for the third quarter of the fiscal year ending March 2021

21

A New Style of Takeout and Delivery Business
Ghost restaurants
From high-level brands to low brands

Restaurants which do not have brickand-mortar facilities but only provide
online delivery services

Cloud kitchens

Eating out at home

(Kitchens without customer tables,
which only accept orders online)

Food
delivery

Major restaurant chain facilities
exclusivelyfor home delivery
and takeout services

Shopping streetsand hotels

Food trucks

Dining in

22

Initiatives to Improve Visibility: (1)Pack Market

SEO

Lineup enhancement
Number of registered items: Approx. 7,700

Pack Market

Actual sales and number of registered members
12000

80,000

Sales in March: Increased approx. 3.1 times year on year
10000

8000

70,000

Number of registered members:
Increased approx. 1,000 from the previous month

60,00050,000

Sales
販売実績

6000

40,000

会員登録数
Number of registered members

Radio commercials
Began to be aired on NACK5, an FM channel, on April 1, 2021
5 times a week (Mon., Tue., Thurs., Fri., and Sat.)“Don’t you know?” edition
https://youtu.be/1hrpLU101UY“Tomorrow’s new standard” edition
https://youtu.be/m1Jt2gmwraQ

30,0004000
20,0002000
10,00000Jul.

Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul.
2020
Oct 1. and onward
Reduced tax rate

Aug. Sept. Oct. Nov. Dec. Jan. Feb. Mar.
2021

Apr. 27 to May 25
State of emergency (1)Jan. 8 to Mar. 21
State of emergency (2)23Initiatives to Improve Visibility: (2) Branding
YouTubeOfficial AccountFollowus
We post information on
new products anddelicious dishes every day.

Official Account

Official Channel

Be our Register
ourfriendWe provide new product information
on Tuesdays and Fridays.

channelFPCO TV

24

DLV Series Color Variations
6 patterns
in total

DLV Men

DLV Lunch

8 patterns
in total

DLV Oval

4 patterns
in total

花くも赤

Dピンク

陶はけ青

うねり金黒

ブルーグレー

本青磁W
Dスカイ
赤W

Dクリーム
陶線紺W
25

Changes in the Growth Rate of Product Sales Quantity
Year-on-year changes
111.0%

109.4%
108.7%

109.0%

107.5%
106.8%
106.1%
105.4%

107.0%

105.0%

103.6%

104.1%

103.9%

102.8%

102.5%

103.0% 102.3%

100.8%
101.0%

102.2%

100.6%

100.7%

100%

100.1%
99.0%
1Q

2Q

104.9%

100.8%

99.7%
3Q

FY ended Mar. 2018

4Q

1Q

2Q

3Q

FY ended Mar. 2019

4Q

1Q

2Q

3Q

FY ended Mar. 2020

4Q

1Q

2Q

3Q

4Q

FY ended Mar. 2021
FY ended Mar. 2021

* Year-on-year changes (excluding products from former Sekisui Hinomaru) 3Q: 105.8% (impact: 3.6%)
4Q: 105.4% (Impact: 3.3%)
Full year: 105.7% (Impact: 1.8%)

26

Stable Supply – Supporting Safe, Secure Dietary Life
Salespeople

Sales forecast

Supply Chain
Management System

Logistical bases

Informing about
the logistics plan
Inventory check

SCM

Production plants

Placement of order
Using AI to improve the precision for productionand efficiency of sales forecasts (based on forecast)(For approx. 5,000 of approx. 11,000 items)

Changes in the number of times stock ran out
40

Nov. 30
Fire atChubu Plant 1

FY2019FY202030

Jan. 8
State of emergency
declared

20
10
10
0
9/1

10/1
10/

1

11/1
11/
1

12/1
12/
1

1/1

2/1

3/1

4/1

4/17

* Excluding former Hinomaru products

27Trends in Raw Material Prices
47,00044,80050,000

Domestically
41,300produced Naphtha
40,000equivalent (yen/KL)
BenzeneAs of Mar, 2021
1350

20,000950

25,000

425

Nov

Dec

Jan

Feb

Mar

Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Mar

Apr

145

150

105

110 125

Jan
2020

Jun

150

155
135

Domestic price ofgeneral PET (yen/kg)
130

Dec

May

183

(yen/kg)

Nov

Feb

185

179

Oct

Jan
2021

Domestic price of170
general polystyrene

90

750

350

425

2020

190

800

550

335
Oct

855

735

730

10,000031,30030,20030,000($/ton)1150

38,800

Feb

Mar

Apr

May

110

100
Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan
2021

Feb

Mar

Apr

May

Jun

28

Actions for Recycling
and the SDGs

FPCO Method of Recycling

Consumers

History

Packaging material
wholesalers

Supermarkets

Replacement ofcontainers withpaper packages

1980

Garbage problem in Hiroshima

1990

Boycott against McDonald’s in the U.S.

1990

Launch of recycling with FPCO method

1995

Establishment of the Act on the Promotion ofSorted Collection and Recycling ofContainers and Packaging

1997

Kyoto Protocol

2008

Launch of transparent container recycling

2010

Launch of PET bottle recycling

2015

Paris Agreement

Initially

6 storesCollection
bases
Start from
Fukuyama City
/ Osaka City

Approx.

30 years

As of Mar,2021

approx.

9,800 bases
30

Investment in Recycling and Ratio of Eco Products
Eco OPET developed

Sales shares of eco products
Eco APET released

Eco Trays only

Eco product sales
for FY ended March 2021

62.2 billion yen

11/3

12/3

13/3

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

Capacity increased in Kyushu

Investments inrecycling(billion yen)Supply capacity ofrecycled PET
materials(thousand tons)

Chubu

Kyushu

Kanto

2.9

0.8

3.2

10

Ratio of eco products to all products
On quantity basis, full year

Ratio of Eco PET and OPET products
On quantity basis, full year

20

30

0.7
0.1

50

0.8

8.5

60

200

Chubu

Capacity increased in Kanto

57

‘13/3

‘21/3

24%

45%
‘14/3

52%

11-year total
amount ofinvestment

100%billion yen(Machinery only)

billion yen(Machinery + landand buildings)

31Collection of Plastic Resources
The corresponding values for the number of containers andbottles were calculated based on the following standard
weights. Foam tray: Approx. 4 grams; Transparent container:
Approx. 10 grams; PET bottle: Approx. 25 grams

Amount of collected containers/ bottles
Results for FY
ended March 2019

Results for FY
ended March 2020

Results for FY
ended March 2021

Forecasts for FY
ending March 2022

8,700 t9,200 t10,000 t

10,000 t(Approx. 1.8
billion units)(Approx. 2.0
billion units)(Approx. 2.1
billion units)(Approx. 2.1
billion units)

67,000 t

73,500 t

75,000 t

79,000 t(Approx. 2.7
billion units)(Approx. 2.9billion units)(Approx. 3.0
billion units)(Approx. 3.1
billion units)

Total amountcollected

75,700 t

82,700 t

85,000 t

89,000 t

Ratio of the amount ofrecycling of used products to
product sales volume

42%

Containers(Foamed OS andtransparent
containers)

Collected from:Supermarkets
Specified corporations

Aprrox.9,800 sites(Transparent containers:
Approx. 5,400 sites)

PET bottles

Collected from:Specified corporations
Supermarkets
Business-related
sources

103%

109%

44%

105%

42%

42%
32

Trends in Laws and Regulations: Amended Basel Convention
AmendedBasel Convention (To come into force in Jan. 2021) Exporter

1. Prior notice

Importer

The export of some types of plastic waste will be subject to control.
Specific examples of plastics which will not be subject to control
1) Pelletized plastics
2) Plastic flakes or fluff which are mostly colorless and transparent or in asingle color
3) Plastic sheets, rolls, and bales emitted from product manufacturing
processes, etc.
4) Foamed polystyrene (PS) in an ingot form

Before 2017

2. Written consent

3. Export

2017 -

2021 -

Chinese import regulations

Basel Convention comes into force

China

China
Japan

China

Japan

Southeast
Asia

Japan

SoutheastAsia

A source of momentum accelerating
domestic recycling
33

Trends in Laws and Regulations: Bill for the Act on Promotionof Resource Circulation for Plastics[Guidelines on environmentally friendly design]
Design andmanufacturing⚫ Formulating guidelines on environmentally friendly design to be followed by manufacturers and creating a system for certifying products
conforming to the guidelines→ The national government will take the initiative in procuring certified products (considerations given in accordance with the Act on Promoting
Green Procurement) and provide support for equipment in use of recycled materials.

[Streamlining the use]
Sales andprovision⚫ Formulating criteria to be followed by providers of one-way plastics (including retailers and service providers)→ Providing instructions and advice from the Competent Minister, giving admonitions and orders to businesses providing a lot of one-way
plastics, and disclosing their names[Sorted collection and recyclingby municipal governments]⚫ Enabling recycling using routes
related to the Containers andPackaging Recycling Act topromote sorted collection ofplastic resources

Disposal,collection,and recycling ⚫ Creating a recycling plan, underwhich municipal governments andrecycle operators cooperate→ Enabling recycle operators certified by
the competent minister to recycle
products by omitting selection,
packaging, etc. by the municipal
government[Voluntary collection by
manufacturers, distributors, etc.]⚫ Creating a plan under which
manufacturers, distributors, etc.
voluntarily collect and recycle
products, etc.
→ Businesses certified by thecompetent minister will no longer
need to receive a permit under theprovisions of the Waste Management
and Public Cleaning Act.

<Promoting collection
at stores, etc.>[Control of disposal bybusinesses and recycling by them]⚫ Creating criteria for controlling plastic disposal
and for recycling them to be followed bybusinesses disposing plastics→ Providing instructions and advice from thecompetent minister, giving admonitions andorders to businesses providing a lot of one-way
plastics, and disclosing their names⚫ Businesses, etc. disposing of plastics will create
recycling plans.
→ Businesses certified by the competent minister
will no longer need to receive a permit under
the provisions of the Waste Management andPublic Cleaning Act.

Building an environment for advanced resource recycling andshifting to circular economy

34

Activities for Promoting Recycling
2019

2020

2021

They are not disposable.
Let’s do Tray Recycling!

Let’s turn used trays
into resources throughTray Recycling.

Let’s reduce CO2 emissions
through Tray Recycling!

Poster design renewal
Poster displayed at

approx.

7,380 stores(by 215 companies as of end of Mar. 2021)
35

Reducing CO2 Emissions: Global and Japanese Trends
2015: Adoption of the Paris Agreement
Work to limit the global average temperature increase to well below 2°C in comparison
with pre-industrial revolution levels, preferably to 1.5°C
To do so, achieve peak global greenhouse gas emissions as soon as possible and reach abalance between greenhouse gas emissions and absorption (by forests, etc.) during the latter
half of the 21st century

Japan
China
US
EU
UK

2030

2050

26% reduction in

Effectively
zero

comparison with FY2013
Reduce emissions
by 2030

Effectively
zero

50～2005年比で52% reduction in

President Biden:
effective zero
emissions policy

55% reduction in

Effectively
zero

comparison
with 2005
50～52%減

comparison with 1990

68% reduction incomparison with 1990

2060

Effectively
zero
36

Eco Tray / Eco APET CO2 Reduction
Eco TrayCO2 emissions

Effect of Recycling on
CO₂ Emissions

Eco APET
Effect of Recycling on
CO₂ Emissions

Eco TrayMaterial
manufacturing

Material
manufacturing
Material
manufacturing

Eco APET

Product
manufacturing

In FY ended March 2021, CO2 emissions

Waste

Material
manufacturing

Product
manufacturing

Distribution

Waste

Product
manufacturing
0.63

Distribution

Waste

Product
manufacturing
0.63

Distribution

Waste

Distribution

were cut by 170,000 tons
(Eco Tray: 40,000 tons, Eco APET: 86,000 tons,
Eco OPET: 44,000 tons)

Virgin trays (made fromvirgin materials)

Eco Tray (made partly
from recycled materials)

Virgin APET plastic
containers (made fromvirgin materials)

Eco APET (made partly
from recycled materials)

Comparison of life cycle assessment between FP Corporation products
Processes that can be skipped by FPCO Method Recycling

Cutting CO2 by 30%

BenzeneEthylbenzene

Styrenemonomer

Polystyrene

Ethylene

Crude
oil

Bottle to Tray
Ethylene
oxide

EthyleneglycolNaphthaXyleneFoamedpolystyrene
traysPara-xylene

High purity
terephthalic
acid

PET
resin

PET
sheets

発泡
PET
スチロールトcontainersレー

supermarkets
specified corporations

business-related
sources

Consumers

Ethylene

Foamedpolystyrene
sheetsConsumers

Crackedpetroleum

Supermarkets

NaphthaWholesalers

Crude
oil

Tray to Tray

37

Examples of Posters Displayed at Supermarkets

Posters
displayed at
Approx.

5,480

stores across Japan

Posters displayed by the Aeon GroupFY ended Feb. 2020

FY ended Feb. 2016

CO2 emissions
reduced byapprox. 5,139
tons in 4 years(As of Mar, 2021)

38

Carbon Offset Declaration Through Recycling [FY3/2020]
FPCO CO2 emissions

215,000 tons
Effective CO2 reduction from saleof eco products

Eco OPET

Eco APET

Eco Tray2,000 tons

Office division

45,000 tons

Logistics division

160,000 tons
42,000 tons
Effective CO2 reduction
from sale of eco products

81,000 tons

160,000 tons

Production division CO2 emissions

168,000 tons

37,000 tons

Eco products sales volume

Eco Tray

19,000 tons

Eco APET

54,000 tons

Eco OPET 20,000 tons

Effective CO2 reduction per 1 kg

Eco Trays: 1.96 ㎏-CO2

×

Eco APET: 1.49 ㎏-CO2
Eco OPET: 2.12 ㎏-CO2

A video on Carbon Offsetting Declaration Through Recycling is available at the following link. (Japanese only)
https://www.fpco.jp/blog/2021/03/31/401

39

Carbon Offset Declaration Through Recycling [FY3/2023]
FPCO CO2 emissions

226,000 tons

Effective CO2 reduction from saleof eco products

2,000 tons
45,000 tons

192,000 tons

Benefits ofsolar power generation

Office division
Logistics division

Eco OPET

46,000 tons
Effective CO2 reduction
from sale of eco products

Eco APET

96,000 tons

Eco Tray

192,000 tons

Production division CO2 emissions

Balance

179,000 tons

50,000 tons

Strategies to achieve goals
Eco products sales volume

21,000 tons

×

Effective CO2 reduction per 1 kg

2.42 ㎏-CO2
Reduce CO2 emissions
during manufacture ofrecycled raw materials(pellets) to zero throughintroduction ofrenewable energy

Expand sales of Eco Trays✓ Increase volume of used trays
collected✓ Increase recycled raw material
procurement volume by introducing
chemical recycling

A video on Carbon Offsetting Declaration Through Recycling is available at the following link. (Japanese only)
https://www.fpco.jp/blog/2021/03/31/401

40

Carbon Offset Declaration Through Recycling [FY3/2025]
Effective CO2 reduction fromsale of eco products

FPCO CO2 emissions

237,000 tons
エコOPET

エコAPET

57,000 tons

127,000 tons

Benefits of solar

237,000 tons power generation

Effective CO2 reduction
from sale of eco
products

237,000 tons

Balance2,000 tons

Office division

45,000 tons

Logistics division

FPCO CO2 emissions(all divisions)

237,000 tons

Manufacturing division

190,000 tons

Eco Tray

53,000 tons
Strategies to achieve goals
Eco products sales volume

Effective CO2 reduction
per 1 kg

Eco APET 63,000 tons
Eco OPET 20,000 tons
Expand sales of Eco
APET Products

Eco APET2.01 ㎏-CO2
Eco OPET2.89 ㎏-CO2

×

Reduction in
CO2 emissions
as a result of
increasing
composition ratioof collected raw
materials✓ Increase volume of used PET bottles
collected✓ Increase production capacity andquality for PET recycled raw materials

A video on Carbon Offsetting Declaration Through Recycling is available at the following link. (Japanese only)
https://www.fpco.jp/blog/2021/03/31/401

41

Diversification of Materials and Research into Recycling
Technologies
New materials

Biomass-based plastics

Paper pulp mold(Plant-derived materials)

Recycling technologies

Material
recycling

Chemicalrecycling42

CO2 Reduction with Biomass-based Plastic Products (1)Bio-HIPS and Bio-PPF:

Released in June 2020

Made from 25% plant derived materials/ Registered with Japan BioPlastics Association

Bio-HIPS

Bio-PPF

CO2 emissions

CO2 emissions

Comparison of CO2 Emissions for Petroleum-Derived HI and Bio-Derived HI

Comparison of CO2 Emissions for Petroleum-Derived PPF and Bio-Derived PPF
Effective reduction
in CO2 emissions:

Effective reduction
in CO2 emissions:

Material
manufacturing

Material
manufacturing

1.88

1.79

Product
manufacturing

1.55

1.43

0.02

1.76

1.60

Petroleum-derived HI

Bio HI

0.76
Distribution

Distribution
Disposal

Product
manufacturing

0.76

0.69
Distribution

Disposal

Material
manufacturing

Product
manufacturing

Product
manufacturing

0.69

Material
manufacturing

0.02

Distribution

0.02
Disposal

Disposal

1.80

1.63

Petroleum-derived PPF

Bio PPF

0.02

43

CO2 Reduction with Biomass-based Plastic Products (2)Calculated based on “Plastic thermoformed products for food” in Product Category Rules (PCR)
for Type-III environmental label (EcoLeaf)

Comparison of CO2 Emissions for
Petroleum-Derived HI and Bio-Derived HI
Effective reduction
in CO2 emissions:

Bio-HIPS

Total-0.25 (-5.75%)
Material
manufacturing

CO2 emissions

1.88
Distribution-5.75%

0.02

Product
manufacturing

Material
manufacturing

1.79

0.69

Product
manufacturing

Disposal

Disposal

1.76

1.60

Petroleum-derived HI

Bio HI

Material manufacturing-0.09 (-2.07%)

Distribution

0.69

0.02

Disposal/ Recycling-0.16 (-3.68%)

Percentage ofbiomaterials
25%

Disposal/recycling stage

CO2 reduction effect

1.8

1.6

1.4

Petroleumderived
HIPS

Incineration/
Stoker furnace/
Landfill/Recycling/
Pulverization

Incineration/
Stoker furnace

1.00(65.0%)(56.8%)

0.65

Incineration/
Stoker furnace

0.65

0.16

Disposal
0.8

0.49

BioHIPS

Landfill/Recycling/
Pulverization

Petroleumbased materials

Disposal(35.0%)

75%

1.60

0.35

1.76
Collection/
Transportation

0.6

Material
manufacturing

1.88
Product
manufacturing

0.69
Distribution
Disposal

0.76

0.4

3.68%
of the entire lifecycle

1.2

1CO2 reduction effect

0.02

1.76

(43.2%)

0.2

Petroleum-derived HI
0

1

2

3

4

5

6

44

CO2 Reduction with Biomass-based Plastic Products (3)Calculated based on “Plastic thermoformed products for food” in Product Category Rules (PCR)
for Type-III environmental label (EcoLeaf)

Comparison of CO2 Emissions for
Petroleum-Derived PPF and Bio-Derived PPF
Effective reduction
in CO2 emissions:

Bio PPF

Total-0.29 (-7.02%)
Material
manufacturing

CO2排出量

Material
manufacturing

1.55
Distribution-7.02%

0.02

1.43

Product
manufacturing

0.76

Product
manufacturing

Distribution

0.76

0.02

Disposal

Disposal

1.80

1.63

Petroleum-derived PPF

Bio PPF

Material manufacturing-0.12 (-2.90%)

Disposal/ Recycling-0.17 (-4.12%)

Percentage ofbiomaterials
25%

Disposal/recycling stage

CO2 reduction effect

1.8

1.6

1.4

Petroleumderived
PPF

1.2

Disposal

Incineration/
Stoker furnace/
Landfill/Recycling/
Pulverization

1.02(56.7%)

1

0.8

0.4

0.67

Incineration/
Stoker furnace

0.67(65.7%)
Landfill/Recycling/
Pulverization

0.17
0.50
Petroleumbased materials

0.35

1.80

0.6

Incineration/
Stoker furnace(34.3%)

75%

CO2 reduction effect

BioPPF
Disposal

1.63

4.12%
of the entire lifecycle

Material
manufacturing

1.55
Product
manufacturingCollection/
Transportation

0.76

0.78

Disposal

Distribution

0.02

1.80

(43.3%)

0.2

Petroleum-derived PPF
0

1

2

3

4

5

6

45

Diversification of Materials and Research into Recycling
Technologies
New materials

Biomass-based plastics

Paper pulp mold(Plant-derived materials)

Recycling technologies

Material
recycling

Chemicalrecycling46

Development of Paper Trays andPaper Containers
From April
2021

Paper trays

From May
2021

Paper containers

Kanto Tsukuba Plant
Introduction of Production Line forPaper Trays and Paper Containers* Some partial changes to FP CHUPA products

Features of Product
Uses FSC®-certified paper

Waterproof and oilproof

Supports wrapping machines

FSC®CoC certification(FSC®C163782)
already obtained at all
offices and paper tray
production plant47

10 Principles and 70 Criteria for FSC Certification

Principle 1: Compliance with laws
Principle 10: Implementation of management
activities- Secure update- Prior use of indigenous species- Non-use of genetically modified organisms- Limitation of fertilizers, agricultural chemicals,
and biological controls- Waste disposal- Preservation of soil

- Commercial and corporate registration- Ownership and use rights of land
- Tax payment- Countermeasures against illegal activities- Anti-corruption

Principle 2: Workers' rights and employment
conditions- Gender equality- Health and safety- Minimum wage
- Education and training- Workers' compensation

Principle 9: High Conservation Value (HCV)

Principle 3: Indigenous peoples' rights- Dialogues with stakeholders- Investigation and identification of highconservation value- Policies and action plan for conservation- Monitoring of HCV- Dialogues with indigenous peoples- Guarantee of traditional rights- Identification and conservation of important
places- Protection of intellectual property

Principle 8: Monitoring and assessment

Principle 4: Community relations- Determination of procedures and methods- Recording of monitoring implementations- Reflection of analysis results in the plan
- Disclosure of results- Sales management- Identification of local stakeholders- Dialogues with local communities- Contribution to local economies- Grievance resolution- Fair compensation

Principle 7: Management planning- Philosophies and policies- Goal setting- Development of a concrete plan
- Disclosure of a management plan
- Involvement by stakeholders

Principle 5: Benefits from forests

Principle 6: Environmental values and impacts- Environmental impact assessment- Conservation of endangered species andtheir habitat ranges- Conservation of old-growth forests- Conservation of rivers and mountain streams- Prohibition to convert natural forests- Diversification of resources to be used
- Sustainable extraction of resources- Prior use of local services- Profitability

Prepared by FPCO based on data from FSC JAPAN 『FSC Principles and Criteria(No.5)』48

Descriptive Texts About FSC
Usable text samples"Forest Conservation Mark""eco-friendly (paper)"Inappropriate expression
samples and concepts"The FSC forests certification leads to contribution to solutionof global warming/global environmental issues"
Not directly related to solutions of environmental issues that are beyond the
responsible penetration of forest management"Employment of FSC-certified products leads to CO2
reduction/absorption"
The effects of certified forests in CO2 absorption are not scientifically proven.

"environmentally friendly(paper)""(paper) protecting theenvironment""The FSC is an institution that examines(authenticates/certifies) forest certification"
The FSC is an international non-profitable organization that operates the forest
certification system. Its examination, authentication, and certification are
implemented by different organizations.

"The FSC is working to conserve environment/FSC-certified
paper leads to conservation of the environment"
Conservation means protection in an untouched state. Considering the actual
activities of the FSC, "preservation" is preferable because it means protection while
using.

Contribution to preservation of biodiversity, etc.

"ecological (paper)"If an ecosystem service verified for FM certification is within the range ofcertification, it can be advertised.

49Diversification of Materials and Research into Recycling
Technologies
New materials

Biomass-based plastics

Paper pulp mold(Plant-derived materials)

Recycling technologies

Material
recycling

Chemicalrecycling50Considering Collaborating with DIC Corporation to Realize
Chemical Recycling
Good points of material recycling

Simple recycling processwith low energetic load

Material recycling

Consumers

Supermarket

Wholesaler

PSP container

PSP sheet

PS resin

Styrene monomer

Ethylbenzene

BenzeneCracked petroleum

NaphthaCrude oil

Ethylene
Chemical recycling
under study

Chemical recycling under study● High decontamination capability● Energetic load is low because it ischemical recycling into styrene
monomer.

We are studying new technologies
with DIC Corporation, aiming to start
this recycling in 2022.
51

Diversity Management Making Maximal Use of
Capabilities

Sorting of used trays
at 10 facilities

Production of wood-like box-typecontainers and secondary
processing at 7 facilities

Recognition concerning
employment of workers with disabilities

In the FPCO Group as of March 2020

Number of employees withdisabilities
Adjusted number of employeeswith disabilities

Ratio of employees withdisabilities

Manufacturing of containers(foamed and transparent)
at 3 facilities

362■ January 2019
Ministry of Health, Labour and Welfare

FY2018 People with Disabilities Active
Company Certification

618.5
12.7%

(FPCO Ducks Corporation)■ October 2020
Toyo Keizai Inc.

Ranked 2nd in ratio of employees withdisabilities
52

Support for Customers in their Employment ofPeople with Disabilities
With FPCO’s support, employment was created for

751 people at 50 locations
Seasoning prepared meat

Processing agricultural products

Cleaning containers

Washing towels

mainly at customers’ workplaces
Jan.14 2021

Inspecting and weighing fruits andvegetables

Sorting marine products

Processing preparedfood

Reducing the volume of used paper

53

Creation of the FP Corp. Environmental FundFPCO has been working on recycling for approx. 30 years since the FPCO method of recycling was started in 1990.

We will cooperate with companies, NPOs, research andeducation institutions, and others.

Subsidizing organizations
which act to solve future social issues

FY ended Mar. 2021
Total applications received: 72 Subsidized projects: 10

FY ending Mar. 2022
Total applications received: 53 Subsidized projects: 14

Grant period
Oct. 1, 2020 to Mar. 31, 2021

Grant period
Apr. 1, 2021 to Mar. 31, 2022 *Up to 3 years

Size of grants
Up to 1 million yen per year per projectSize of grants
Up to 2 million yen per year per project

Total amount of grants
7.82 million yen

Total amount of grants
21.17 million yen

54

Activities of Organizations Subsidized by the FP Corp.
Environment Fund (Some of the Activities)
Activities in FY ended Mar. 2021

Shonan Cleanaid Forum (Kanagawa)

Miyajima Network (Hiroshima)<Details of the activities><Details of the activities>

Cleaning up the coast and inland area of
Miyajima Island and activities forprotecting the marine ecosystem

Beach cleanup activities on
the natural coast of Kanagawa<Number of employees who
participated> 53<Number of employees who
participated> 13

Arakawa Clean Aid Forum (Tokyo)

Biwako Trust (Shiga)

People’s Community (Gifu)<Details of the activities>
Education through the experience of cleaning up the
Arakawa River, which is aimed at resolving the issueof marine plastic waste<Number of employees who participated> 6<Details of the activities>
Surveys of microplastics in Lake Biwa and the educationof younger generations<Details of the activities>
Collection of garbage from the Kisogawa River,fact-finding surveys of the river, and awarenessraising activities<Number of employees who participated> 11<Number of employees who participated> 4

A total of 87 employees of the FPCO Group also participatedin these activities as volunteers.
55

Donations to Children's Cafeterias Nationwide
Donation of simple food containers
Donated to: Children’s cafeterias all over Japan supported by
Zenkoku Kodomo Shokudo Shien Center Musubie, an
NPO which supports children’s cafeterias all over thecountry, and local networks of children’s cafeterias allover the country

Donations: 1st donation (May 29 - ):2nd donation (Jul. 25 - ):3rd donation (Sept. 30 - ):4th donation (Dec. 17 - ):5th donation (Feb. 26 - ):Total

60,800 sets
81,600 sets
81,600 sets
80,000 sets
80,000 sets
384,000 sets

Kobe
BussanNestlé
Japan

Hagoromo
Foods

FPCO

Donation of three-layered masks
Scope of eligibility:
Children's cafeterias nationwide
Donated items:
Three-layered masks (BFE, PFE 99%
or higher)
2,000 masks per organization × 200
organizations
Total: 400,000 masks
Sent sequentially as of December 7
56

ESG Evaluation
Continuing to be selected to be a constituent of the FTSE4Good
Index Series and FTSE Blossom Japan Index ESG indexes （June 2020)
Indexes developed by FT Russel of the London Stock Exchange Group,
which reflect the performance of companies taking excellent
Environmental, Social and Governance (ESG) measures
Jun. 2019

Total score

3.44

3.63

3.89

3.89

Climate Change

54Pollution and Resources

45

Supply Chain

33

Water Security

4

4

3.75

3.63

Health and Safety3

3

Human Rights andCommunity

4

3

Labor Standards

44Supply Chain

4

4

2.8

3.4

Corporate Governance4

4

Risk Management

2

3

Environmental

FPCO is one of 1,075 companies
in the world

SocialGovernance

FPCO is one of 196 companies
in JapanJun. 2020

57

ESG Evaluation
FPCO’s initiatives were introduced in the Guidance for Disclosure andEngagement for Promoting Sustainable Finance toward a Circular Economy, which wascompiled by the Ministry of Economy, Trade and Industry and the Ministry of the Environment.
Source: Guidance for Disclosure and Engagement for Promoting Sustainable Finance toward a Circular Economy (Ministry of Economy, Trade and Industry)(https://www.meti.go.jp/english/press/2021/pdf/0119_004b.pdf)

Case 7. A case in which values and business model are disclosed

FP Corporation has established an environmental policy, the basic
principle of which is to contribute to therealization of a society in which sustainable development ispossible in harmony with the environment, based on therecognition that the preservation and protection of the global
environment are the most important issue.

In addition, its report describes the company's value chain,
explains the company's products and services provided at eachstage, and shows how the company's business contributes tosolving social issues by clearly stating the correspondence with the
SDGs.

58

Logistics Network

Actions for Suppressing Soaring Logistics Expenses (Distribution of Sales)
Increase ratio of private services

97.6%

March, 2021

110.0%

ended Mar. 2021
Increase load efficiency per truck FY
Comparison with
FY ended Mar. 2016
(Sai* per truck) * 1 sai = 0.027826474 m 3

FY 2020

1,441
1,414

＜load efficiency per truck＞
1,438 1,432

1,415

1,430 1,436

1,444 1,443

1,428 1,439
1,392

FY 2019
FY 2018
FY 2017

FY 2016

FY 2015

1,338
1,315

1,329

1,325
1,302

1,313

1,300

1,302

1,296
1,292

1,270

1,216
Apr

May

Jun

Jul

Aug

Sep

Oct

Nov

Dec

Jan

Feb

Mar

60

Efficiency Improvement (Logistics Division)
Voice Picking

Productivity enabled by voice picking

本/時間

Items/Hour

Mar. 2021

837
items per
hour

2014

2017

Pallet Transportation (Transportation to other bases)

2019

2020

Jan.

Mar.

Nov.

Jul.

Sep.

May

Jan.

Mar.

Nov.

Jul.

Sep.

May

Jan.

Mar.

Nov.

Jul.

2018

Sep.

May

Jan.

Mar.

Nov.

Jul.

Sep.

May

Jan.

Mar.

Nov.

Jul.

2016

Sep.

May

Jan.

Mar.

Nov.

Jul.

2015

Sep.

May

Jan.

Nov.

1) Listen to instructions
2) Select with both hands
3) Respond verbally

Mar.

Immediately
after introductionof the system:
300 items per
hour

2021

Conducted on 5 routes
in Mar. 2021

Example: Kanto Distribution Center → Hachioji Distribution Center

BeforeLoading

72 minTransport
90 minUnloading

62 min100% manual
loadingNew
method80% by pallets
20% manual
loading

Loading

24 minTransport
90 minLoading and unloading time
reduced by 1.5 hours

Unloading

20 min＞ Loading efficiency: -8%61

Promotion of Automation and Unmanned Operations(1) Production(2) Pickup by AGF(3) Transportation by AGV

Automated Guided Forklift (AGF)

Automated Guided Vehicle (AGV)

Unmanned pickup of products from factory
and temporary storage of them

Automated transfer on the same
floor in a warehouse

Unmanned pickupof products(4) Storage

Shipment system with automatic sorter

Sorted according
to route

Stored by staff

Unmannedstorage

Number of workers per floor

Before:13(6) Sorting

Input fromeach floor

Transfer on thesame floor on AGV

Unmannedtransportation(5) Shipment

Loading berth(7) Loading and delivery

Number of workers per floor（Warehouse with a capacity of
35,000 cases)

Before:

7

After

After

11+ 2 AGFs

4 + 3 AGVs

Percentage of products in Japanthat are sorted automatically
March 2021:

54%(Kanto DC, Hachioji DC, and Fukuyama DC)

After the new centers comeinto operation76%(To be introduced to Chubu DC and New Hyogo DC)

62

Strategic Investment

FPCO’s Strategic Investment
Group companies, etc.
グループ会社等
Systems
システム
Recycling
リサイクル
Logistics
物流
製造
Manufacturing

29.8

Ordinary profit before
depreciation and amortization

23.3

27.1
23.3
21.0

20.2
12.5

12.4

Unit: billion yen

19.4

15.0

14.0

12.2

9.0
Capital investment

10/3

11/3

12/3

13/3

World’s first materials developed
2010: Launch of Multi FP (MFP)
2012: Launch of Multi Solid (MSD)
2012: Launch of Eco APET
2012: Launch of OPET
2012: Launch of New Transparent PP

14/3

15/3

16/3

17/3

18/3

19/3

20/3

21/3

22/3 plan

Microwave market expanded
Distribution network
constructed2014: Fukuyama Cross Dock Center
2015: Hachioji Distribution Center

Soaring cost of regular cargo services
Recycling strengthened

ESG investment
increased

2016: Chubu Eco PET plant
2018: Kanto Eco PET plant

Distribution network
enhanced
2020: Kyushu Distribution Center expanded
2020: Fukuyama Distribution Center expanded
2020: Chubu Distribution Center expanded
2022: Distribution Center of the New Facility in
Hyogo (tentative name)

Investment in humanresources64Enhancing the Logistics Network
KyushuDistribution Center

Completion scheduled in Sept. 2020
Investment: 644 million yen
Total floor area: 3,554 m2

Chubu Cross Dock Center

Fukuyama
Distribution Center

Completion scheduled in Sep. 2021
Investment: 5,285 million yen
Total floor area: 27,575 m2

Completion scheduled in Nov. 2020
Investment: 3,950 million yen
Total floor area: 23,722 m2

Introducing an automated sorting system,or sorter, to Chubu, following Kanto,
Fukuyama, and Hachioji

65Construction of a New Plant and Distribution
Center of the New Facility in Hyogo
Completion of a network which covers

70% of the total population, including the
populations of major cities, within 150 km

Hokkaido

radius from each baseTohokuChubu

KansaiIncreasing logistics capacity in the Kinki area

Kanto

(Located between Chubu and Fukuyama)→ Reducing delivery time and minimizing logistics costs→ Enhancement of business continuity and supply stability ina disaster

Hachioji

Increasing production capacity→ Plan to introduce extrusion and molding lines
Completion scheduled:
Investment:
Address:
Building overview:
Site area:
Gross floor area:

September 2022
25.3 billion yen
Hyogo Ono Industrial Estate,Ono-shi, Hyogo
Four story steel frame
construction
Approximately 48,000 m2
Approximately 78,900 m2

Fukuyama

KyushuTokai

Construction of Pico House No.5, a dormitory for single
employees, in Ono-shi, Hyogo is being planned.
66

Investment in Human Resources (1): Automation
Manufacturing Division

Logistics Division

Labor reduction
equal to approx.
Labor reduction
equal to approx.
Labor reduction
equal to approx.

164 workers

234 workers

Reducing labor withunmanned, laser-guided
operations for transferringand storing pallets

Unmanned transfer on thesame floor in a warehouse,
which reduces labor

201 workers 3/2022 forecast
3/2021

3/2020⚫ Case packing robots
21 units⚫ Automatic dusting andpackaging machines
8 units⚫ Automatic packaging
machines
56 units
3/2021

AGV (automated guided vehicle)
29 units → 33 units→

67 units

3/2021

Planned in 3/2022

AGF (automated guided forklift)
Introduce 2 units
3/2021

Planned in 3/2022

SCM Division

Use of RPA

Using AI to improve theprecision and efficiency
of sales forecasts
Approx. 5,000 items
3/2020AI

Automation of operations with robots
Reduction of approx. 11,400 work hours/year3/2021
Using RPA

Approx. 8,700 hours

Improvement of existing
functions and operations
Approx. 2,700 hours→ Expected to reduce work hours
by approx.

20,000/year

3/2022 forecast

67

Investment in Human Resources (2):Development of Working Environment
Pico House bachelors’
dormitories
Completed in March 2020

No. 3
63 units

Completedin October 2020

Group homes for people withdisabilities
No. 4
18 units

Completedin April 2020

20 units

Floor plan: First floor
Sharedspace

To be used for study
support, support fortherapeutic education, etc.
by the local community

A residential space whereresidents live together

Location: Koga, Ibaraki Pref.

Location: Fukuyama, Hiroshima Pref.

Location: Fukuyama, Hiroshima Pref.

Residential
units

Home・CO Pearl

Changes to programs andstandards
1. Fiscal year ended March 2019

Introduction of requirement to take five consecutive daysof paid leave (Smile Leave)
2. Fiscal year ended March 2019

Revision of the retirement benefit programs at somegroup companies
3. Fiscal year ended March 2020

Pay standard raised at some group companies
4. Fiscal year ending March 2021

Introduction of a teleworking program
5. Fiscal year ending March 2021

Introduction of special leave for volunteer activities

Promotion of active participationof women
Targets
1. Maintaining the percentageof women among new
career-track employees at
30% or higher from 2019
onward
2. Promoting 50 women to
managerial positions by2022
68Growth Strategy

FPCO Growth Strategy
Long-term target

300.0

billion yen

3,000

Commodities

Overall packaging+60.0 billion materials

2,500

Plan for ‘22/3
Products

195.0 billion yen+40.0 billion

2,000Market share increase

alternative materials

30.0

Paper pulp moldbillion yen

1,000(delivery, food service, frozen food, etc.)

R&D for recycling andLong-term
target1,500

New markets

Chemicalrecycling

Biomass-based
plastics(Plant-derived materials)

Ordinary profit
500

20.2
billion yen

Considering M&A
0

03/3'03/3期

06/3'06/3期

09/3'09/3期

12/3'12/3期

15/3'15/3期

18/3'18/3期’21/3期計画
22/3 plan'21/3期計画

Long-term
長期目標
target* Changed to the Accounting Standard for Revenue Recognition in FY ending Mar. 2022

70

Overview of Business Transfer from Sekisui Hinomaru
Name:
Locations:Sekisui Hinomaru K.K.
(Head offices) Kumamoto and Fukuoka(Sales offices) Fukuoka, Kagoshima,
Hiroshima, Osaka, andTokyo(Plants)
Saga and Ibaraki

Transferredbusiness:

Molding business

Sales:

Approx. 5.2 billion yen (Molding business only)

Number oftransferred
employees:

139 (38 salespeople and 101 plant/warehouse workers)

Transfer date:

October 1, 2020

* Including contract employees and part-time employees

Synergetic effects
Products

Business
partners

Lineup of PSP trays, including
for fishcakes, dried-salted fish,and spicy cod roe

Trades with food processors

Rawmaterials
Production
Logistics
SCM

Cost reduction enabled by leveraging
benefits of scale
Productivity improvement enabled bysharing expertise71

Expected Improvements from Integration of Infrastructure
Production30

Effective utilization of plant space → increase
production capacity

25

Lighter products → reduce raw material costs andsave resources
Example: general purpose trays of the same size
3.88 g → 3.10 g (approximately 20% reduction)

Number of Defective Items for Former Hinomaru Products

Update graphbefore submission

20
15
10

Increase compatibility of machinery and dies →
improve productivity and decrease conveyance costs
Increase number of shots per hour and equipment
operation rate

5
0

10/1
10/
1

11/1
11/

1

12/1
12/
1

1/1

2/1

3/1

4/1

4/17

Distribution
Utilize own delivery vehicles → reduce delivery costs
Review cardboard case volume (dimensions, etc.) → easier to carry for female and older drivers

SCM
Demand prediction, production planning and inventory management using SCM → stable supply even during busy periods

Sales andmanagement
Revenue management by model number → improve MIX

72

New Market: Frozen Foods Customer Case Studies
Four products in the "Kyo no okazu renji de tsukuru" seriesof microwaveable meals

NISSUI
Multi FP containers
adopted for home-use
frozen food products

1. Lighter container
reduces
environmental impact
Container is approximately 19% lighter
than existing containers (main body +inner packaging).

2. Thermal insulation gives
consideration for safety
and peace of mind
The outside of the container does not become hoteasily even when heated in a microwave, enablingsafe removal.

Internal packaging:cold-resistant PP
Main body: Multi FP

3. Easy-to-store sizeand design
The container is disgned to have a low
profile overall, making it easier to store inhome freezers (in comparison withexisting containers).

Multi FPPP filler73

To Increase Corporate Value“We ensure that we reliably deliver the mostenvironmentally friendly products of the highest
quality at the most competitive prices wheneverthey are needed.”MarketingITsystems

Product
development
capability

Solution proposal
capability
Informationcollecting ability

Recycling

The FP Corporation Value Chainthat keeps creating value
for customers
SCM
StablesupplyLogistics
network

Productionengineering
capability

74

Supporting Data

Explanation of terms
PS： Polystyrene

PET： Polyethylene terephthalate

PP： Polypropylene

Multi FP (MFP)： An formed PS (polystyrene) container with cold and heat resistance to temperatures
between -40ºC and +110ºC and with superior oil and acid resistance and thermal insulation (sales commenced in 2010).

Multi Solid (MSD)： A non-formed PS (polystyrene) container with a heat resistance temperature of +110ºC that is able to create sharp figuresby using scraps of materials from the Multi FP, while maintaining the characteristics of the Multi FP(sales commenced in 2012).

New transparent PP
container： A transparent PP container with a heat resistance temperature of +110ºC,
which has achieved the same transparency as OPS using standard-grade polypropylene raw material(sales commenced in 2012).

OPS container： A conventional transparent container with a heat resistance temperature of +80ºC that is molded from the bi-axially oriented polystyrene sheets.

Eco Tray： A recycled foamed polystyrene container for which polystyrene containers collected at supermarket shop countersand scrap pieces collected within plants are used as raw materials (sales commenced in 1992).

Eco APET： A recycled PET transparent container for which PET transparent containers collected at supermarket shop counters,
PET bottles and scrap pieces collected within plants are used as raw materials (sales commenced in 2012).

Eco OPET： A recycled OPET transparent container molded from the bi-axially oriented PET sheets, which use the same raw materials as an Eco APET
container.
Superior oil resistance and high transparency, with the same thermal insulation as the OPS transparent container.
Heat resistance temperature of +80ºC (sales commenced in 2016).

Bio-HIPS container： HIPS (non-foamed polystyrene) container containing 25% of plant-derived materials (sales commenced in 2020).

Bio-PPF container： Polypropylene with fillers (PPF) container containing 25% of plant-derived materials (sales commenced in 2020).

FSC®

： Forest Stewardship Council® (FSC®) is an international non-profit organization established topromote responsible management forests in the world. FSC sets standards based on principles
on responsible forest management, which are supported by the agreement of stakeholders in theenvironment, social, and economic fields.

Cross Dock Center： A center that achieves a cross-docking method of gathering all the products to be shipped in one place, and loading themin order of delivery after an all-in assortment by each delivery route, replacing the method of loading products sent to customers
using individual delivery trucks making rounds of visits to warehouses.

Distribution Center
Picking Center： Ships products by unit of case： Conduct picking operations for products and goods by small lots and ship

Sorting Center： Sorts PS containers collected from stores according to white and other colors, and transparent containers
collected from stores according to materials such as PS, PET and PP.

76

World’s First Sheets and Materials
PS: polystyrene

PP: polypropylene
 Heat-resistant: +110ºC
 High oil resistance Foam is hard and resistant toweight reduction.
 Low firmness
 Low cold resistance Difficult to make transparent

New transparent PP

 Resin introduced last High transparency
 High oil resistance Low heat-resistance: +60ºC
 Heavy

 Easy to mold
 Low raw material ratio Weight reduction is possible
 High insulation
 Low heat resistance: +80ºC
 Low oil resistance

MFP: multi FP

 Heat-resistant: +110ºC
 High oil resistance Same transparency as OPS

PET: polyethylene terephthalate

PSP: foamed polystyrenePSP(foamed)PP

PET(transparent)

OPET: BiaxiallyOPS(transparent) Easy to mold
 Low raw material ratio High thermal insulation
 High oil resistance Resistant to a wide range oftemperatures: -40 to +110ºC
 High firmness
 Weight reduction is possible: foamedpolystyrene

Recycling ofmulti-FP remnants

HIPS

stretched PET

MSD： Multisolid High transparency
 High oil resistance Same heat-resistanceas OPS: +80ºC
 Weight can be reduced by stretching Difficult to moldNon-foaming polystyrene

OPS: oriented polystyrene
 Transparent
 Heat-resistant: +80ºC
 Low oil resistance Limited weight
reduction* The pie chart at the center represents the share by material (on weight basis). 77

Trends in original products development
’11/3

‘21/3

Feb. 2010: Market release of the Multi FP (MFP)
Feb. 2012: Market release of the Multi Solid (MSD)
May 2012: Market release of the Eco APET
Nov. 2010

Chubu PET Recycling Plant

Jun. 2014

March 2016

Nishinihon PET-Bottle
Recycle Co., Ltd.

Chubu Eco PET Plant
Aug. 2017

Kanto Eco PET Plant

Nov. 2012: Market release of the OPET
Jul. 2012

Kanto Yachiyo Plant

Jun. 2012: Market release of New Transparent PP
78

Factors influencing Ordinary Profit
Unit:100 million yen
'15/3
'03/3

Ordinary Profit
for previous
year

63.1

'04/3

28.6

'05/3

33.6

'06/3

36.3

'07/3

'09/3

'10/3

'11/3

'12/3

'13/3

66.5

81.2

64.5

92.9 122.2 134.7 149.5-6.0 -13.8 -36.5 -10.0 -13.0

-39.5

-37.0

-25.0

The Price of Material-25.0+7.7 +29.2+4.0

Sales Price

Raw material replacement
and lighter-weight products

Sales Efforts

'08/3

+2.0

Increase in quantity/
improvements to+45.0
product mix

+8.6

+78.0

Raw material priceincrease-19.0'22/3 Plan

151.2

2nd
half

Full
year

1st
half

2nd
half

Full
year

1st
half

2nd
half

Full
year

1st
half

2nd
half

Full
year

1st
half

2nd
half

Full
year

1st
half

2nd
half

Full
year

1st
half

2nd
half

Full
year

51.1

49.4 100.5

47.4

53.6 101.1

66.3

74.0 140.3

79.1

78.3 157.4

66.3

69.2 135.5

64.8

83.8

148.6

74.4

88.3

162.7

85.6

108.2

193.8

+16.0

+15.0

+20.0

+3.0

+2.5

+5.2

+7.7

+11.0

+3.0

+14.0

-8.0

-10.0

-18.0

+32.0

+6.5

1st product pricereduction-44.0

Product pricecorrection+15.0 +14.0

+2.0

+16.0

2nd product pricereduction-19.0

Price war on
general-purpose
products-13.0 -10.0

-3.0

-13.0

+20.0

New material effects+8.0+4.5 +10.0

+14.5

+24.5

'21/3

1st
half

+25.0

+11.8

'20/3

Full
year

-15.5

+38.0

'19/3

2nd
half

-37.0

+9.0

'18/3

1st
half

Decrease in raw
material prices

-23.0

'17/3

-46.0

-7.0

-

+31.0

+23.0

-7.0

-3.0

Naphtha formula

+17.5

+5.8

+3.0

+7.0

+6.0

+21.5 +15.0 +21.0

+1.0

-

+4.0

+4.0

-8.0

-11.0

-12.5

-11.0

-13.0

-13.0

-26.0

-14.8

-15.5

-30.3

-

+4.5

+4.5

+13.6

+28.0

+41.6

+10.5

-

+10.5

-23.5

+8.5

+11.0

+19.5

+10.5

+12.5

+23.0

+6.0

+3.2

+9.2

+4.5

+7.2

+11.7

+3.5

+5.0

+8.5

+7.2

+9.8

+17.0

+11.0

+8.0

+19.0

Improved Production

+2.4

-2.0

+6.0

+8.7

+3.0

+2.5

+9.5

+12.0

+9.0

+2.5

+1.0

+0.5

+3.5

+4.0

+5.0

+7.0

+12.0

+3.2

+1.1

+4.3

-3.2

-4.0

-7.2

-0.5

-

-0.5

+1.0

+1.5

+2.5

-1.5

+3.5

+2.0

+3.5

+3.5

+7.0

Improved Distribution+0.3 -14.0 +12.2

+5.5

+8.0

+5.7

+5.0

+9.5

+8.0

+4.0

+1.5

+1.0

-

-1.0

-1.0

-

+1.5

+1.5

-3.0

-2.7

-5.7

+0.5

+1.0

+1.5

-1.5

-3.0

-4.5

-4.0

-3.5

-7.5

-0.5

+1.5

+1.0

+2.5

+2.5

+5.0

+5.0

+5.5

+5.0

+1.0

-1.0

-

-1.5

-1.5

+3.0

+2.5

+5.5

+2.0

+3.0

+5.0

-

+1.5

+1.5

+0.5

+1.5

+2.0

+2.0

+0.1

+2.1

-0.7

+6.5

+5.8

+4.0

+2.0

+6.0

Subsidies

+5.9

+0.6

+6.5

-1.4

-0.3

-1.7

-3.7

+0.8

-2.9

Group
Companies

-0.6

+8.0

Decrease in raw
material prices

'16/3

'14/3

Profit from thesale of artwork

+1.0

-1.0

Cost increase-6.2 -19.3

-3.2

+4.2

-7.4

Total increase/decrease

-34.5

+5.0

Ordinary profit

28.6

33.6

+4.0

-4.0

-9.7

-15.6

-12.7

-11.5

-13.2

-15.3

-17.0 -11.6 -10.4

-22.0

-9.2

-8.4

-17.6

-3.7

-2.4

-6.1

-3.1

-2.3

-5.4

-3.3

-3.6

-6.9

-5.9

-3.8

-9.7

-4.3

-4.4

-8.7

-7.6

-3.2

-10.8

+2.7 +30.2 +14.7

-16.7

+28.4

+29.3

+12.5 +14.8

+1.7

-51.0

-3.7

+4.2

+0.5

+18.9

+20.3

+39.2

+12.8

+4.3

+17.1

-12.8

-9.1

-21.9

-1.5

+14.6

+13.1

+9.6

+4.5

+14.1

+11.2

+19.9

+31.1

+5.4

+2.8

+8.2

36.3

64.5

92.9 122.3 134.7 149.5 151.2

100.5

47.4

53.6 101.1

66.3

74.0 140.3

79.1

78.3 157.4

66.3

69.2 135.5

64.8

83.8 148.6

74.4

88.3

162.7

85.6

108.2

193.8

91.0

111.0

202.0

66.5

81.2

79

Trends in Capital Investment and R&D Costs
FY ended
March 2003

FY ended
March 2004

FY ended
March 2005

Yamagata Plant

FY ended
March 2006

FY ended
March 2007

FY ended
March 2008

FY ended
March 2009

Shimodate Daini Plant

FY ended
March 2010

Taiyo Kosan

Production

FY ended
March 2011

Nihon PearlContainers

FY ended
March 2012

FY ended
March 2013

FY ended
March 2014

FY ended
March 2015

FY ended
March 2016

FY ended
March 2017

Hokkaido Plant
extension

Kyushu Daini Plant

FY ended
March 2019

FY ended
March 2020

FY ended
March 2021

FY endingMarch 2022
Plan

"FPCO Research Center"
Development and Training Building

Dia Foods

Wood Plant Food container ALRightfacilities

Chubu Daini Plant

FY ended
March 2018

Kanto Eco PET plant
New ｐlant and ｄistribution ｃenter of the ｎew ｆacility in Hyogo

Chubu Eco PET plant

Kanto Yachiyo Pla nt

Chubu Daiichi Plant

Automation

Boosting the production capacity of original products

Distribution

East Japan Hub Center

Kanto Yachiyo Center

Kyusyu HC extension

New Fukuyama Picking Center

Voice picking

Logistics centers in Kansai

Kyushu HC

New Chubu Picking Center

Fukuyama HC extension

Fukuyama Cross Dock Center

Kansai PC

Kanto PC extension
Hokkaido HC>

Logistics centers in Kyushu

Chubu Cross Dock Center

Logistics centers in Hachioji

New Hokkaido HC

Improving the distribution network >Chubu, Tohoku & Kyushu Recycling Plants

Na tionwide expansion of container sorting centers

Recycling

Capacity increased in Kanto and Kyushu

Equipment renewa l of clea ning lines
Chubu pelletizing
Chubu Recycling Plant

NPR

Construction of a new recycling network >Chubu PET Mechanical Recycling Plant
PET recycling operations >Tokai HC

Other investments
and costs

Head OfficeLand & building in Fukuyama

Land for logistics centers in Kyushu

Yuka ShojiLand for New Kanto PlantLand & building in Chubu

Film Plant

Land for logistics centers in KansaiInterpack
Land for logistics centers in Hachioji

Miyakohimo

company accomodations

Film Printing Plant

company accomodations

company accomodations

Group home

Unit : million yen
Capital investment

7,096

5,037

2,742

2,394

9,885

10,90913,007

9,090

12,585

12,42315,087

20,257

23,377

23,38321,06029,891

14,038

12,214

19,412

27,100

Tangible

6,138

4,248

2,621

2,156

9,523

10,655

12,166

8,827

12,352

12,093

14,78319,75023,051

23,05820,79029,342

13,442

11,688

19,10526,600Intangible

958

789

120

238

362

254

841

263

233

329

303

506

325

324

269

549

595

525

306

500

Figures for molds only

780

460

436

550

771

609

1,892

1,507

1,833

1,946

1,425

2,151

2,416

1,777

2,028

1,485

1,462

1,870

1,426

1,852

Depreciation andamortization

3,339

4,210

4,134

3,965

4,194

4,742

8,467

8,461

9,316

9,728

9,746

9,703

11,136

9,526

11,183

11,706

13,17013,532

13,60913,760Research and development

654

628

689

751

895

913

965

1,035

1,101

1,051

1,062

1,148

1,105

1,242

1,223

1,197

1,159

1,229

1,195

1,335

* Since 2009/03, capital investment have been included procurement through lease.

80Changes in the Number of Households
One-person households
Households of single parents with children
Other general households
02015

10,00020,000One-person households

Couple-onlyhouseholds

Couple-only households
Households of couples with children

one person and couples
30,00040,000

55%
56%

2025

58%

2030

50,000Component ratio

2020

The number of oneperson households
will hit its peak in
2032.

Ratio of households with

The number ofhouseholds will
hit its peak in2023.

aged 65 or older
2015
Other

57%

Aged 65
or older

43%

2040

59%
Other

48%
2035

60%

2040

60%

Aged 65
or older52%

Up 9 percentage
points in 25 years

Source: The graph was prepared by FPCO based on data from the National Institute of Population and Social Security Research.

81

Trend in Scale of Home Meal Replacement Market
10

10.3

Trillion yen

8
6

7.2

7.6

7.8

7.9

8.2

8.1

8.1

8.4

8.7

8.9

9.3

9.6

9.8

10.1 10.3

FY2019Home meal
replacement
Approx.

4

10.3 trillion yen

2

Cooking at home:
Approx. 35.9 trillion yen
Eating out:
Approx. 26.0 trillion yen
Major food
manufacturers

0
2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

Source: Prepared by FPCO based on data from the Japan Ready Made Meal
Association’s White Paper on Ready Made Meals, the Japan Food Service
Association, and FPCO’s own estimates

Markets expected to grow in the future
Frozen food forhouseholds
Approx.

Delivery

0.37 trillion yen
2020

Source: Japan Frozen Food Association, Production andConsumption of Frozen Food in Japan

Approx.

0.33 trillion yen
2020 (Forecast)

Source: Fuji Keizai, Food Service Industry Marketing
Handbook 2020

Takeout
Approx.

0.88 trillion yen
2020 (Forecast)

Source: Fuji Keizai, Food Service Industry Marketing
Handbook 2020

Food service for
elderly facilities
Approx.

1.16 trillion yen
2017 (Forecast)

Source: Fuji Keizai, Koureisha Muke Shokuhin Shijo-no Shorai Tembo
2017 (Future Outlook for the Market of Food for the Elderly 2017)82

Expanding Market
Net sales of the
FPCO Group

Mostly supermarkets

Convenience
storesFood manufacturers

Restaurants(for home meal replacement)(home delivery/takeout meals)

Prepared food stores

Food service/Nursing-carefacilities
Frozen food manufacturers

Trays with lids

New noodle container fordeliveryOriginal products

Color foodcontainers

1960s

1970s

Addressing thelabor shortage

Eco TrayWhite trays

1980s

1990s

2000s

2010s

Containers for food service

2020s
83

Hospital/ Nursing Care and Frozen Food as New Markets

Hospital/Nursing
care

Frozenfood
The number of people who
received Minna-no Nichiyobi(Sunday for Everyone) foodservices
Approx.
As of Jul. 31, 2019

Approx.

60,000Approx.

57%
As of Nov. 30, 2019

240,000/Approx. 420,000

With superior thermal insulation,
MFP ensuressafety andreassurance

14%/Approx. 420,000

Approx.

MFP that ensures safety
and reassurance when
heating the foodIt’s hot inside,
but not on theoutside.

OPET,
which is strong during frozen distribution
With superior cold resistance,
OPET lids are

hard to break.
84

Business Continuity Plan (BCP)
Logistics network

全国の物流ネットワーク
acrossthe country
Inventory storage capacity:
Approx. 3.7 million cases
Total floor area: Approx.

661,157 m

Distribution
centerHokkaido Distribution Center
81,000 cases
17,190 m2

Picking
centerTohoku Distribution Center
265,000 cases
42,975 m

2

As of December 20202

Kansai Distribution Center
147,000 cases
Fukuyama Distribution Center
51,900 m
939,000 cases
167,272 m

Kanto Distribution Center
1,062,000 cases
191,404 m

2

2

2

Kyushu Distribution Center
432,000 cases
73,388 m

Hachioji Distribution Center
336,000 cases
55,537 m

2

2

Chubu Distribution Center
412,000 cases
75,731 m
2

For uninterrupted logistics operationsin the event of a disaster

Tokai Distribution Center
50,000 cases
15,537 m
2

Emergency power generator

Fuel tank⚫ Power supply for 72 hours ensured⚫ Emergency power generators are installed and fuel for them is stored at all
major logistics bases across Japan.

⚫ Two emergency drills conducted annually involving power generator

85

Capital Investment and Cash Flows
Cash flows from operating activities

Billion yen
60

0.15

12.5%

Capital investment:

12.8%
12.0% 12.0%

11.5%

10.1%
50

10.6%

Goal of 18 to 25 billion yen

8.9%

10.0%
9.4%

9.1%

4.0%

40

32.9

- Market demand for recycled and eco-friendly products- Establishing a system for stable supply

29.8
30

26.9

20.6
20

19.7

17.7
15.0
12.5 12.4

13.0 9.0
10

28.0

0

27.1

23.3 23.5

22.7

Consolidated payout: Goal of 30%

Ordinary profit
before depreciation

29.8

25.2

24.6 24.8

Adjustment of interest-bearing debt

0.05

Cost of equity[Priority investment areas]

Acquisition of treasury shares

0.1

7.8% 7.7%

Enhance the system for supplying high value-added products
from the perspective of medium- and long-term growth

Stable and continuous payment of dividends
Maximization of earnings per share

ROE

21.2
23.3

21.0

19.4

-0.05

20.2
14.0
12.2
Capital investment-0.1

0

-0.15

3/2009 3/2010 3/2011 3/2012 3/2013 3/2014 3/2015 3/2016 3/2017 3/2018 3/2019 3/2020 3/2021 3/2022

86

Ocean Plastic Pollution: Trends in the World and Japan
Global trends
2017

China

2018

G7

Trends in Japan

Notification of waste import restrictions
to WTO
Ocean Plastics Charter

2019

MOE

Comprehensive strategy for plastic
material recycling(Excerpt of milestones)- Reusing and recycling 60% of containers and packages by 2030
- Making effective use of 100% of used plastics, such as throughreuse and recycling, by 2035
- Introducing approx. 2.0 million tons of bioplastics by 2030

2021

Amendment to the Basel Convention
Some waste plastics are subject to export regulations.
<Specific examples of plastics exempted from the regulations>(1) Plastics in pellets(2) Plastics in a flake or fluff form which is almost colorless andtransparent or in a single color(3) Plastic sheets, rolls, and bales discharged from productmanufacturing process, etc.
(4) Foamed polystyrene (PS) ingots

Bill for the Act on Promotion of Resource Circulation
for Plastics[Voluntary collection by manufacturers and distributors]⚫ Manufacturers, distributors, etc. create plans on voluntarycollection and recycling of products, etc.
→ Businesses certified by the competent minister will no longer
need to receive a permit under the provisions of the Waste
Management and Public Cleaning Act.

87

Strategy for Plastic Material Recycling by the Ministry of the Environment (Rough Plan)

Ocean Plastics Charter endorsed at
Charlevoix G7 Summit in Canada

Taking into account the full environmental impacts ofalternatives, significantly reducing the unnecessary use of
single-use plastics.

Working with industry towards 100% reusable, recyclable, or,where viable alternatives do not exist, recoverable, plastics by2030
Working with industry and other levels of government, torecycle and reuse at least 55% of plastic packaging by 2030
and recover 100% of all plastics, including thermal recovery,by 2040.

Working with industry to increase recycled content by at least
50% in plastic products where applicable by 2030.

* Created by FPCO based on data from the Ministry of the Environment

Strategy for Plastic Material Recyclingby the Ministry of the Environment(Rough Plan): Milestone

ReduceReuse &
RecycleRecycling/
Biomass
plastics

We aim to reduce emissions of single-use plastics(containers and packaging) by 25% in cumulative total by2030 through the understanding, cooperation andcollaboration of consumers and people from all quarters andall levels of civil society, while taking into account theenvironmental impacts of alternatives.
We aim to change the designs of plastic containers,
packaging and products into those that make separation
technologically easy and permit reuse or recycling, while
also trying to secure their functions by 2025. (Even where
this is difficult, we will aim to ensure thermal recoverability).
We aim to recycle or reuse 60% of plastic containers andpackaging by 2030 and make 100% effective use of usedplastics, including thermal recovery (when recycle or reuse isdifficult from the technical or economical perspective), by2035, through cooperation and collaboration with people
from all quarters and all levels of civil society.
We aim to recycle twice the volume of plastics by 2030 bypromoting the understanding, cooperation and collaborationof different groups of the public including the government
and local municipalities.
We aim to introduce as much biomass plastics as possible(approx. 2 million tons) by 2030 by promoting theunderstanding, cooperation and collaboration of people fromall quarters and all levels of civil society.

88Collaboration with Related Ministries, Agencies and Organizations
Actions of related ministries, agencies and organizations● Plastic resources recycling strategy

Ministry of theEnvironment

Presentation on Japan’s plastic resource recycling strategy planned at the G20
Summit in June 2019

● Plastics Smart
Encouraging smart use of plastics and communicating such uses worldwide

Ministry of
the Economy,
Trade andIndustry

Ministry ofAgriculture,
Forestry and
Fisheries

Keidanren(Japan Business
Federation)

 Participation in a subcommittee as an industrial
association
 Publication of Tray to Tray and Bottle to Tray
recycling on the campaigns page

● Clean Ocean Material Alliance
A syndicate of companies implementing proper waste management and 3R
actions for plastic products and accelerating innovation for resolving marine
plastic issues● Call for plastic resource recycling declarations
Collecting and showcasing examples of voluntary actions taken by companies
and associations in the food industry

 Participation in the alliance as a leading member Publication of actions for recycling, reducing
and raising awareness on the ministry’s website● Plastic-related Innovation for SDGs
Collecting and showcasing examples of actions taken by businesses andassociations for encouraging the recycling of plastic resources and for helping
address the issue of marine plastic waste● Japan Climate Initiative

Initiative

FPCO’s involvement

A network of Japanese entities committed to joining the front line of the global
push for decarbonization and taking positive actions to combat climate change Publication of actions for recycling, reducing
and raising awareness on Keidanren’s website

 Announcement of participation during thefoundation89

【 Information on the Facility Tour 】

Contact: Takashima at the Corporate Planning Department(TEL)+81-3-5325-7756 (MAIL)ir_7947@fpco-net.co.jp
at a convenient time for you.

An opportunity to take a look at the state-of-the-art
Production, Distribution, Recycling operations

Kanto

30 minutes from Koga station on JR East Lines.

OPET production facilities

Kanto Recycling
Plant
Kanto Distribution Center

Hachioji

20 minutes from Akigawa station
on JR East Lines.

Kanto Yachiyo Plant

Kanto Eco PET plant

You can observe logistics facilities.

Fukuyama

30 minutes from Fukuyama station on JR West Lines.

Chubu

20 minutes from Gifuhashima station on JR Tokai Lines.

Chubu Distribution Center
Picking Center

Chubu Eco PET plantContainer Sorting
PS Recycling

Air feedpipeline

PET Recycling

PET Mechanical Recycling plant90