July 13, 2023
To Whom It May Concern,
Company Name
RepresentativeInquiries

Toyo Denki Seizo K.K.
Akira Watanabe,President, Representative Director(Stock Code: 6505 TSE Standard)
Jun Nukina, Operating Officer, General
Manager, Management Planning Division
Tel.: +81-3-5202-8122

Notice Concerning Management Targets of Medium-Term Management Plan
Toyo Denki Group (hereinafter the “Group”) is pleased to announce that it has revised its Medium-TermManagement Plan 2026, which was announced on July 14, 2022, and whose final year is the fiscal year ending May
2026, and has established new management targets for three years from the fiscal year ending May 2024 to the fiscalyear ending May 2026.
1. Background of the review
We positioned the fiscal year ended May 2023, the initial year of the Medium-Term Management Plan, as “a yearto thoroughly take initiatives in structural reforms to increase profitability,” carrying on from the fiscal year ended
May 2022 when there was impairment treatment of business assets related to the Industrial Business segment. And
initiatives toward revitalizing and transforming Toyo Denki have been strongly promoted. Also, we announced thatthe numerical targets of Medium-Term Management Plan 2026 toward the fiscal year ending May 2026 would bepresented in July 2023, based on the progress and results of the structural reforms over the past year and the businessenvironment.
2. Basic Policy of Medium-Term Management Plan 2026
The Group had decided to work on a new four-year medium-term management plan based on the achievements
obtained along with remaining issues in the medium-term management plan Revitalize 2020/2022 (fiscal year ended
May 2019 to fiscal year ended May 2022) that was implemented until the fiscal year ended May 2022. Meanwhile,
the Group was not able to secure sufficient profitability to respond to major changes in the business environment,
including the decrease in number of railway passengers due to the COVID-19 pandemic and a review of testing
equipment for electrification of automobiles. As a consequence, results were substantially below what was planned.
Taking into account the issues the Company itself is facing which also became clear from the results, we havepositioned Medium-Term Management Plan 2026 (fiscal year ending May 2023 to fiscal year ending May 2026) asa period to achieve revitalization and transformation of Toyo Denki so as to recover and improve corporate value.
To do so, we aim to achieve ROE of 8% or more by promoting three basic policies of the Plan: (1) expansion of
new businesses and products, (2) thorough improvement in earnings structure of existing businesses, and (3)improvement in asset efficiency with awareness of capital cost.
Three basic policies(1)

Expansion of new businesses andproducts(2)

Thorough improvement in earnings
structure of existing businesses(3)

Improvement in asset efficiency
with awareness of capital costContents
Strengthen and expedite development of new business areas acrossthe company, and respond to electrification, DX, anddecarbonization
Drastically strengthen profitability of both factories and sales fromthe viewpoint of improving production efficiency and securing
appropriate selling prices
Continue to reduce cross-shareholdings, review capital efficiencyof each business and consider reallocation of management
resources

3.

Target management indicators(100 million yen)
Medium-Term Management Plan 2026

Company-wide(consolidated)
Net salesFYE May2022 results
301.5

FYE May2023 results
310.2FYE May
2024 plan
345.0

FYE May2026 plan
400.0

Operating profit(Operatingmargin)
Ordinary profit

1.7

5.1

6.0

20.0

0.5%

1.7%

1.7%

5.0%

7.6

9.8

9.5

24.0

Profit

(9.3)

8.2

8.0

16.0

ROE
Dividend payout
ratio(4.0)%

3.5%

4.0%－32.7%

35.4%

8.0%
30.0% ormore

198.5

218.0

250.0

99.0

116.0

130.0

12.5

11.0

20.0

Consolidated sales by segment
Transportation
194.5
Business
Industry
99.0
Business
ICT Solution
7.9
Business(100 million yen)

Net sales

Medium-Term Management Plan 2026

Revitalization andTransformation of Toyo Denki(100 million yen)

Operating Profit/ ROE
OperatingprofitOperatingmarginROE