May 9, 2019
Lion Corporation

Analyst Q&A (Summary)First Quarter Ended March 31, 2019
Business Performance
Q: Were results for the first quarter as projected? It seems like performance will have toimprove substantially to meet the published forecasts for the first half of the year.
A: The consolidated total results for the first quarter are more or less as projected. To meet
our previously published forecasts, sales from April to June will need to increase by morethan 4%. We expect fields that are showing strong sales in Japan, such as oral care,beauty care and living care, to continue growing. Overseas, we expect firm expansion inSoutheast Asia as well as improvement in China to contribute to sales. As such, we thinkthat our targets for the first half of the year are achievable.
Q: Was the decrease in profit in Consumer Products within the range of your assumptions?
A: Yes, it was. The first quarter saw the launch of such major new products as CLINICAADVANTAGE NEXT STAGE Toothpaste and CHARMY Magica Enzyme + (“Plus”),
requiring up-front investment in competition-related expenses that led to the decrease inprofit.
Q: Fabric Care struggled in the first quarter. What are your strategies for recovery in thesecond quarter?
A: Unit prices in the laundry detergent market, which had fallen, are recovering. , Our strategyof mainly promoting super-concentrated liquid laundry detergents, which saw firm sales in
the first quarter, is unchanged. In regular liquid laundry detergents, where we faced
challenging circumstances in the first quarter, we released new and improved TOP Clear
Liquid in April and added a new antibacterial version to its lineup. At the same time, we areworking to nurture markets for the new fabric softener released in February to improve
performance in fabric care as a whole.
Q: What impact do you expect raw material prices to have in the second quarter and beyond?
A: Our assumptions at the start of the year viewed raw material prices as a factor negatively
impacting first-half profit. However, in the first quarter, prices fell below our projections,providing a boost to profit, mainly in the Overseas Business. However, crude oil prices
have recently been rising, so it is unclear whether raw material prices will remain a positive
factor for profit in the second quarter and beyond.

1Overseas Business
Q: Profit in the Overseas Business rose substantially, and the segment profit margin rose tothe level of Lion’s domestic businesses. What factors caused this, and what is yourforecast going forward?
A: Our business in China, where we implemented structural reforms last year, steadily
contributed to increased profit, and in Southeast Asia, where sales continue to grow, weare seeing profit improvement thanks to synergies between volume increases and costreductions. Also, the portion of sales accounted for by the personal care field is rising,helping to boost the profit margin. This field includes oral care, which is growing in part asa result of efforts to promote preventive dentistry. Compared with businesses in Japan,
there is still considerable room to increase volumes and cut costs, so we expect the profit
margin to expand further. That said, these businesses are also impacted by raw material
cost fluctuations, so we will have to proceed carefully.
Other
Q: Did China’s new law on e-commerce impact sales from visitors to Japan?
A: We estimate that sales from overseas visitors to Japan fell about ¥300 million year on year.
We do not have a detailed breakdown to tell us whether that was due entirely to China’s
new e-commerce law, but yes, sales of certain pharmaceutical products were impacted.
Q: In the second quarter, what steps are you taking to prepare for the consumption tax hike?
A: We expect rush demand ahead of the tax hike to begin in earnest in the third quarter.
Based on the sales patterns surrounding the previous consumption tax hike, we will takeappropriate steps to precisely capture this demand. We are also considering measures tospur demand after the tax hike, such as introducing high-value-added products.

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 conference call. 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 thetime 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
from the forward-looking statements made herein.

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