MORITO CO., LTD.
Presentation Materials for the Six Months of
the Fiscal Year Ending November 30, 2024,
Financial Results
Where innovation is the norm

Prime Market of TSE: 9837
July 2024@ 2024 MORITO CO.,LTD.

CONTENTS

1

Company Profile2

8th Mid-term Management Plan
(Announced in January 2024)

3

FY2024.11 2Q Financial Results

4

FY2024.11 2Q Business Overview

5

FY2024 Full-Year Forecast

6

Business Topics

7

Shareholder Returns

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

01

Company Profile

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

02

Morito Group Values

Founding Principles

Active and Steadfast
Corporate Principle

DESIGN YOUR BRIGHT FUTURE WITH OUR VARIOUS
PARTS.
Corporate Vision

Create Morito’s existence value,
Realize “New Morito Group”

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

03

Company Profile● Founded in 1908
･ Began operating in Osaka as a broker of eyelets andsnap fasteners･ Later expanded operations mainly for sales of MAGICTAPE® and other clothing accessories, automotive
interior components, etc.

● Trading company with manufacturing functions･ A specialized trading company that handles everythingfrom planning and development to manufacturing,
wholesale, and distribution

Eyelets

Snap fasteners

MAGIC TAPE®

*Eyelet: A metal ring attached to a hole inshoes, clothing, etc. through whicha lace or cord is threaded･ Operating in 19 locations around the world● Operating three businesses･ Apparel, product, and transportation businesses
form the core of our operations･ Ratio of in-house production and procurement is 3:7

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

04

Operations by BusinessApparel Business

Product Business<Examples of products handled><Examples of products handled>

Snap fasteners MAGIC TAPE®

Buttons

MAGIC TAPE®

Grease filter

InsolesIn-housebrandsStrapsSkateboards,
snowboards, andsurfboards

In-housebrandsTape

Eyelets andshoelaces<Applications>Casual wear/shoes
Sportswear/shoes
Workwear/shoes

Medical wear, baby wear
Formal wear/shoes, bags

Where innovation is the norm

Transportation Business<Examples of products handled><Applications>
Insoles and shoe care productsVideo equipment-related products such as
camera and PC cases,
braces and supports, safety products, teachingtools and stationery
Skateboards, surfboards, etc.
Active sports products
Grease filter rental service

Snap fasteners MAGIC TAPE®

Emblems

Trunk floor
lining

Nets

Door armrests<Applications>
Automotive interior components
Railway and Shinkansen interior components
Aircraft interior components@ 2024 MORITO CO.,LTD.

05

Morito’s Strengths● Lines of business for daily necessities, which are unaffected by trends
Since we deal in parts for things that are vital to people’s daily lives, many of our businesses are
essentially immune to trends or economic downturns and can continue to operate as usual.
● Stable performance with a diversified portfolio
Operating worldwide with three core businesses focused on apparel, products, and transportation,
we have maintained a stable financial performance without falling into the red despite the impact of
the oil crises (in the 1970s), the 2008 financial crisis, and the COVID-19 pandemic.
● Enjoying high market share for various products targeting niche areas
Many products dominate the market in their respective industry.
We have the top market share for metal snap fasteners in Japan, and the highest or second-highest
in the world.
● Global manufacturing, procurement, and sales capabilities
In addition to our own locations, we have partner plants and distributors all over the world, giving us
close proximity to our customers and the ability to respond to their every need.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

06

8th Mid-term Management Plan
(Announced in January 2024)

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

07

Medium- and Long-term Policy Morito’s Vision

Become a global niche top company thatkeeps making a big difference in the world
with small parts

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

08

Summary of 8th Mid-term Management Plan Update(Announced in January 2024)
We updated the 8th Mid-term Management Plan in anticipation of achieving our initial financial targets
earlier than planned thanks to the improved profit margin as a result of business restructuring and theopportunities created and costs cut during the pandemic, which enabled us to establish a lean profit
structure (designed to create more customer value using fewer resources than a traditional structure).
Situational analysis<Outcome of initiatives implemented>
1. Improved profit margin as a result of business restructuring

Historical Stock Price and PBRStock Price

2. Opportunities created and costs cut during the pandemic

1,295 JPYPBR

799 JPY

758 JPY
612 JPY 641 JPY

3. Improved PBR (see graph on the right)

0.90

Establishing a lean profit structure
Initial financial targets to be achieved earlier thanprojected

0.67

2019

0.52

0.52

0.55

2020

2021

2022

2023

<Issues>
1. Specific growth strategies for eachbusiness
2. Investment for future growth
3. Management aiming at PBR of 1 or higher-> Realize ROE exceeding costof equity

Action plan
● Investing with an eye to growth under the next mid-term plan
Boost capital investments, new businesses, and B2C / Build IT infrastructure and invest in
human capital / Expand manufacturing function● Moving Rideeco® forward● Growth strategies for existing businesses
Local production for local consumption and Asia strategies / Increase global market share

8th Mid-term Management Plan update

Financial targets● Revised financial targets upward● Use the run-up to FY2026 to pave the way toward
accelerating growth in the future[FY2026]
Net sales: 60,000 million JPY Operating profit: 3,000 million JPY
ROE: 6.5%

Where innovation is the norm

[Our vision for FY2030]
Net sales: 80,000 million JPY Operating profit: 5,000 million JPY
ROE: 8.0%@ 2024 MORITO CO.,LTD.

09

Roadmap to 100,000 Million JPY in Net Sales

Build a global
earnings base andmanagement system

Revampmanagement
structure andsow seeds forincreasing
profit

7th Mid-termManagement Plan

Period for building abusiness structure
designed toweather the COVID19 pandemic

Establish a lean profit structure
Aggressively invest for
the future

Increase boththe top line andprofit margin

80,000

Our vision for FY2030

8th Mid-termManagement Plan

Net sales: 80,000
million JPY Operating
profit: 5,000 million
JPY ROE: 8.0%
60,00048,5295,000

48,478Bring net sales
up to 100,000
million JPY

45,98743,943

43,636

41,38840,72740,086

2,464
2,116
3,000

1,767

1,707

1,725

1,619

1,734

Operating profit on

8th Mid-term Management Plan (5 years)856

net sales(Million JPY)

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

Targets

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@ 2024 MORITO CO.,LTD.

10

Current Status and Vision for 2030 by BusinessNet sales

Increase both profit
margin andbusiness size

2030
Efforts focused on
North American
operations

ApparelFocus on improving
profitability while
increasing business size

Expand efforts to increase
profit margin and efficiency

2030

Create new corebusinesses

2030
Product

2030

New

Transportation

Product

M*

Operating profit ratio*Product Ⓜ is a business added to the Morito Group’s operations as a result of an acquisition, etc. It mainly refers to businesses related to
kitchen appliance-related services and action sports.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

11

Financial Target Update
Focus on increasing our top line, in addition to keeping the recently improved profit margin up.
Aim to achieve further growth in both sales and operating profit after the 8th Mid-term Management
Plan period although we expect growth in operating profit to remain within a certain range due toaggressive investment.

Net sales

Operating profit

60,000
million JPY

3,000
million JPY+500
million JPY(+20.0%)+10,000
million JPY(+20.0%)48,500
million JPY

50,000
million JPY

2,400
million JPY

2,500
million JPY

Operating profit
ratio of 5.0%2023 results

Where innovation is the norm

2026 initial target

2026 revised target

2023 results

2026 initial target

Operating profit
ratio of 5.0%2026 revised target@ 2024 MORITO CO.,LTD.

12

Investment Strategy

Existing investments and equipment retention

Operating CF
7,000 million JPY±20%

Cash on handExternal
procurement

1,200 million JPY

Growthinvestment

New product development expenses

500 million JPY

Initiatives to reduce environmental impact

500 million JPY

Capital investment (Ace Industrial Machinery, Morito Scovill Americas, Morito Danang, Morito Scovill Mexico)

600 million JPY

Strengthening B2C

300 million JPY

Building data infrastructure and enhancing BI functions

500 million JPY

Investment in human capital

100 million JPY

M&A

5,000 million JPY

Shareholder returns

6,000 million JPY*Total investments over 3 years up until FY2026

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

13

Investment Strategy [M&A]

M&A policy

1. Niche top company

2. Group synergies

Low risk

Acquired in 2014: GSG FASTENERS, LLC(now Morito Scovill Americas, LLC)

3. Stable earnings base

Increasing global share
Affiliate for apparel, footwear, and bag materials

Acquired in 2014:
Matex Inc.

Expanding manufacturing functions
Manufacturer of resins, metals, and fibers for automobile interior
components and apparel materials

PriorityStrengthening B2C business
High-end brand offering high added value such as functionality, design, durability, etc.

High risk
Where innovation is the norm

Entering a new market

Acquired in 2018:
Maneuverline Co., Ltd.

Residential space, healthcare, and service companies@ 2024 MORITO CO.,LTD.

14

Corporate Strategy [Capital and Financial Strategy: Overview]● Expand business through aggressive growth investment (see p. 13 for details of investment strategy)● Optimize capital structure by utilizing interest-bearing debt
● Continue shareholder return and control net assets
Target B/S structure
Current B/S

Cash anddeposits

Liability

Use cash generated by
improved CCC, effective use
and sale of assets, etc. forinvestment

Cash anddeposits
Reduction

Interest-bearing
debt

Liability
Interestbearing debt
Utilization

Use it for future investments
in business expansion,
including M&A

Higherstock
price

AssetsNet assets

MarketcapitalizationNet
assetsMarketcapitalization

AssetsContinue shareholder return and control net assets
Basic dividend policy: Target a dividend payout ratio of 50% and DOE ratio of 4.0%,
and buy back shares whenever necessary and cancel them appropriately▶ For more information about the 8th Mid-Term Management Plan Update, click here.

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@ 2024 MORITO CO.,LTD.

15

Financial targets

FY2023 results

FY2026 targets

Our vision for FY2030

Net sales

48,500 million JPY

60,000 million JPY

80,000 million JPY

Operating profit

2,400 million JPY

3,000 million JPY

5,000 million JPY

Total assets

51,400 million JPY

Increase via growth investment

Net assets

38,400 million JPY

Maintain current level via shareholder returns

Interest-bearing debt

1,400 million JPY

Increase due to use for growth investment

Equity ratio

74.7%

Decrease due to use of interest-bearing debt

ROE

5.9%

Payout ratio

66.2%

DOE

3.9%

Performance

Assets/ROE

Shareholder returns

Growth investment

Where innovation is the norm

Share repurchase

470 million JPY

Investment amount

540 million JPY

6.5%

8.0%

Decrease due to profit growth
4.0%

4.0%

Consider buying back shares whenever necessary

8,700 million JPY*Total for the FY2024 – FY2026 period

Increase growthinvestment@ 2024 MORITO CO.,LTD.

16

FY2024.11 2Q Financial Results

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

17

FY2024 2Q

Highlights● 2Q operating profit and ordinary profit hit all-time highs since webegan reporting semiannual results for the third consecutive fiscal
year.
● Continued efforts to streamline unprofitable businesses resulted in
improved profits although we still have some issues with net sales.
● The apparel and product businesses were affected by inventory
adjustments and production cutbacks by manufacturers in Japandue to a warm winter and the end of the post-pandemic surge indemand.
● The apparel business is on the road to recovery from stagnant
demand for products sold in Europe and the U.S. and inventory
adjustments.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

18

FY2024 2Q

Summary of Financial Results

Net sales decreased due to a warm winter and inventory adjustments, especially in Japan.
Made good progress in turning a profit, especially in terms of gross profit ratio, thanks tobusiness restructuring, withdrawal from unprofitable businesses, and sales efforts.

2023.2Q

2024.2Q

Gross profit

24,1486,541

23,7496,933

Gross profit ratio

27.1%

29.2%

Cost

5,236

5,449

Cost ratio

21.7%

22.9%

Operating profit

1,305

1,483

Operating profit ratio

5.4%

6.2%

Ordinary profit

1,459

1,565

Ordinary profit ratio

6.0%

6.6%

Net income

1,308

1,393

Net income ratio

5.4%

5.9%

Net sales

Where innovation is the norm

Increase/
Decrease

Y/Y

-399

-1.7%

+392

+6.0%

+213

+4.1%

+178

+13.7%

+106

+7.3%

+85

+6.5%

@ 2024 MORITO CO.,LTD.

19

FY2024 2Q

Net Sales

Net sales: 23,749 million JPY Y/Y: -399 million JPY (-1.7%)
Net sales fell off in Japan due to inventory adjustments and production cutbacks bydomestic manufacturers due to a warm winter and the end to the post-pandemic surge indemand, although stagnant sales of products sold in Europe and the U.S. are on a recovery
trend. There was also a decrease in sales due to withdrawal from unprofitable businesses.

(Million JPY)

Japan
16,285 million JPY
Y/Y -1,043 million JPY (-6.0%)

24,14823,794Asia
4,054 million JPY
Y/Y +471 million JPY (+13.1%)

Europe & the U.S. 3,409 million JPY
Y/Y +173 million JPY (+5.3%)
2023

Where innovation is the norm

2024

@ 2024 MORITO CO.,LTD.

20

FY2024 2Q Quarterly Sales Trends
Net sales in 2Q lagged behind our forecast due to inventory adjustments in Japan, mainly
affecting the apparel and product businesses, as well as the end of the post-pandemic
surge, although sales in Europe and the U.S. were on a gradual recovery trajectory.

14,000(Million JPY)

13,00012,00011,00010,000
9,000
8,000
7,000
6,000
5,000
1Q

2Q

3Q

2020

Where innovation is the norm

4Q

1Q

2Q

3Q

2021

4Q

1Q

2Q

3Q

2022

4Q

1Q

2Q

3Q

2023

4Q

1Q

2Q

2024

@ 2024 MORITO CO.,LTD.

21

FY2024 2Q

Gross Profit

Gross profit: 6,933 million JPY Y/Y: +392 million JPY (+6.0%)
Increased due to improved gross profit ratio.
Since Morito Japan’s split 2 years ago, awareness of profit margins has continued toincrease among corporate managers and sales personnel of each company.
(Million JPY)

6,933
6,541

2023

Where innovation is the norm

2024

Increase/
Decrease

FY2023

FY2024

Y/Y

Net sales

24,14823,749

-399

-1.7%

Gross profit

6,541

6,933

+392

+6.0%

Gross profit
ratio

27.1%

29.2%

Cost

5,236

5,449

+213

+4.1%

OperatingprofitOrdinary
profit

1,305

1,483

+178

+13.7%

1,459

1,565

+106

+7.3%

Net income

1,308

1,393

+85

+6.5%

@ 2024 MORITO CO.,LTD.

22

FY2024 2Q

Trends in Net Sales & Gross Profit Ratio

The gross profit ratio improved due to rising awareness of profit margins, which
resulted in the streamlining of unprofitable businesses, changes in sales terms andconditions, and sales commensurate with high-value-added products, etc.

(Million JPY)

4Q
Total net sales
4Q累計売上高(Cumulative)

2Q Total net sales
2Q累計売上高Grossprofit ratio
売上総利益率30.0%

50,000

Forecast

40,00028.0%

30,00026.0%

20,00024.0%

10,000

22.0%

0

20.0%

2014

Where innovation is the norm

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

@ 2024 MORITO CO.,LTD.

23

FY2024 2Q

Operating Profit

Operating profit: 1,483 million JPY Y/Y: +178 million JPN (+13.7%)
Increased due to higher gross profit. Cost increased due to personnel, travel, and otherexpenses.

(Million JPY)

1,305

2023

Where innovation is the norm

Increase/
Decrease

FY2023

FY2024

Y/Y

Net sales

24,14823,749

-399

-1.7%

Gross profit

6,541

6,933

+392

+6.0%

Gross profit
ratio

27.1%

29.2%

Cost

5,236

5,449

+213

+4.1%

Cost ratio

21.7%

22.9%

OperatingprofitOperatingprofit ratio
Ordinary
profit

1,305

1,483

+178

+13.7%

5.4%

6.2%

1,459

1,565

+106

+7.3%

Net income

1,308

1,393

+85

+6.5%

1,483

2024

@ 2024 MORITO CO.,LTD.

24

FY2024 2Q

Ordinary Profit

Ordinary profit: 1,565 million JPY Y/Y: +106 million JPY (+7.3%)
Increased due to higher operating profit.

(Million JPY)

1,459

2023

Where innovation is the norm

1,565

2024

Increase/
Decrease

FY2023

FY2024

Y/Y

Net sales

24,14823,749

-399

-1.7%

Gross profit

6,541

6,933

+392

+6.0%

Cost

5,236

5,449

+213

+4.1%

OperatingprofitOperatingprofit ratio
Ordinary
profitOrdinary
profit ratio

1,305

1,483

+178

+13.7%

5.4%

6.2%

1,459

1,565

+106

+7.3%

6.0%

6.6%

Net income

1,308

1,393

+85

+6.5%

Net income
ratio

5.4%

5.9%

@ 2024 MORITO CO.,LTD.

25

FY2024 2Q

Net Income

Net income: 1,393 million JPY Y/Y: +85 million JPY (+6.5%)
Increased due to an increase in extraordinary income, including gains on sales ofinvestment securities.

(Million JPY)

1,308

2023

Where innovation is the norm

1,393

2024

Increase/
Decrease

FY2023

FY2024

Y/Y

Net sales

24,14823,749

-399

-1.7%

Gross profit

6,541

6,933

+392

+6.0%

Cost

5,236

5,449

+213

+4.1%

OperatingprofitOrdinary
profitOrdinary
profit ratio

1,305

1,483

+178

+13.7%

1,459

1,565

+106

+7.3%

6.0%

6.6%

Net income

1,308

1,393

+85

+6.5%

Net income
ratio

5.4%

5.9%

@ 2024 MORITO CO.,LTD.

26

FY2024 2Q

Consolidated Balance Sheet

CCC improved. Although we moved ahead with the sale of cross-shareholdings, theirmarket value increased due to rising stock prices.
(Million JPY)

2023 4Q

2023 4Q

2024 2Q

Liabilities

AssetsCurrent assets

31,1492024 2Q

31,082(-67)

Current liabilities

8,589

7,756

Fixed liabilities

4,382

4,450

Total liabilities

12,972

12,206(-833)(+68)(-766)Net assets

Fixed assets

20,280Shareholders’equity32,673

Accumulated othercomprehensive income

5,760

Share acquisitionrights23

51,832

Total net assets

38,457(+403)

Total liabilities
and net assets

51,42920,749(+469)

Total assets

51,429Equity ratio

Where innovation is the norm

33,137(+463)

6,488(+728)

0(-23)

39,626(+1,169)

51,832(+403)

2024.2Q 76.4%(2023.4Q 74.7%)@ 2024 MORITO CO.,LTD.

27

FY2024 2Q

Consolidated Cash Flow Statement

Increased awareness of inventory and CCC contributed. Cash flows from operating
activities improved significantly.
(Million JPY)

2023 2Q

2024 2Q

Cash and cash equivalents at beginning of period

10,396

13,009Cash flows from operating activities

1,160

2,301

Cash flows from investing activities

112

429

Cash flows from financing activities(709)(1,219)Effect of exchange rate change on cash and cash
equivalents

(199)

51

363

1,562

Increase in cash and cash equivalents resulting from
inclusion of subsidiaries in consolidation--

Decrease in cash and cash equivalents resulting
from exclusion of subsidiaries from consolidation--

10,75914,572

Net increase (decrease) in cash and cash
equivalents

Cash and cash equivalents at end of period

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

28

FY2024.11 2Q Business Overview

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

29

FY2024 2Q

Net Sales by Region(Million JPY)

Japan

17,328Asia

Europe & the U.S.

16,285

1,719

4,054
1,969

3,236

3,409

2023

2024

3,583

2023

2024

Y/Y: -1,043 million JPY(-6.0%)

Where innovation is the norm

2023
2023

2024
2024

Y/Y: +471 million JPY(+13.1%)

Y/Y: +173 million JPY(+5.3%)@ 2024 MORITO CO.,LTD.

30

FY2024 2Q

Net Sales for Apparel BusinessNet sales: 11,446 million JPY Y/Y: +215 million JPY (+1.9%)
Inventory adjustments of products sold in Europe and the U.S. were coming to an end. In
Asia, adoption of locally produced and procured products increased.
In Japan, sales stalled due to inventory adjustments and production cutbacks bymanufacturers, but new orders are expected in the second half of the year.

(Million JPY)

●

7,000

Japan
･ Increase in accessories for medical wear and bags sold in
Europe and the U.S.
･ Increase in accessories for high-end outdoor brands･ Decrease in accessories for workwear and casual wear

6,000
5,000
4,000

Asia

3,000

･ Decrease in accessories for workwear in China and Hong Kong
･ Increase in accessories for casual wear in China and Hong
Kong
･ Increase in accessories for athletic shoes and workwear-related
products in Vietnam

2,000
1,000
0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
2022
Japan
日本

Where innovation is the norm

2023
Asia
アジア

2024

Europe欧米 & the U.S.

Europe & the U.S.
･ Decrease in accessories for casual wear sold in the U.S.
･ Increase in accessories for medical wear

@ 2024 MORITO CO.,LTD.

31

FY2024 2Q

Net Sales for Product BusinessNet sales: 8,664 million JPY Y/Y: -649 million JPY (-7.0%)
Kitchen appliance-related services remained strong. Demand for active sports-related
products that rose during the COVID-19 pandemic subsided.
A surge in demand is expected during the next Olympics. Significant progress was made in
streamlining unprofitable businesses, particularly Morito Japan.
グラフ タイトル(Million JPY)

6,000

Japan

5,000

･ Increase in products for one-coin shops andstationery products･ Increase in kitchen appliance rental, sales, andcleaning business･ Decrease in construction safety products andmedical device-related products･ Decrease in snowboarding-related products

4,000
3,000
2,000
1,000
0
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
2022
Japan
日本

Where innovation is the norm

2023
Asia
アジア

2024

Asia
･ On a par with last year

Europe & the U.S.
欧米

@ 2024 MORITO CO.,LTD.

32

FY2024 2Q

Net Sales for Transportation BusinessNet sales: 3,638 million JPY Y/Y: +34 million JPY (+1.0%)
Although domestic production was idled in 1Q mainly due to the stoppage of factory operations by
JAMA-affiliated automakers, the pace of production is expected to pick up to make up for the loss.
The impact of the certification test fraud by some automakers is expected to be minor.
Sales in China increased due to the end of the zero-COVID policy. However, we plan to continue
withdrawing from unprofitable businesses.

2,500(Million JPY)

Japan

2,000

･ Decrease in automotive interior components for Japanese
automotive manufacturers

1,500

Asia
1,000

･ Increase in automotive interior components for Japanese
automotive manufacturers in China

5000
1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
2022
Japan
日本

Where innovation is the norm

2023
Asia
アジア

Europe & the U.S.

2024

Europe欧米 & the U.S.

･ Increase in automotive interior components for Japanese
automotive manufacturers@ 2024 MORITO CO.,LTD.

33

FY2024 2Q

Net Sales by Region (Quarterly)(Million JPY)

FY2024
1Q

2Q

First-half
Increase/
Composition
total
Decrease

Y/Y

Japan

8,195

8,090

16,28568.6%-1,043

-6.0%

Asia

1,969

2,085

4,054

17.1%

+471

+13.1%

Europe &the U.S.

1,579

1,830

3,409

14.3%

+173

+5.3%

Total

11,74412,00523,749100.0%

-399

-1.7%

FY2023
1Q

2Q

First-half
total

3Q

4Q

Full year Composition

Japan

8,502

8,826

17,328

7,901

8,841

34,070

Asia

1,719

1,864

3,583

1,739

2,383

Europe &the U.S.

1,582

1,654

3,236

1,763

Total

11,804

12,344

24,148

11,403

Where innovation is the norm

Increase/
Decrease

Y/Y

70.2%

+554

+1.7%

7,705

15.9%

-635

-7.6%

1,754

6,753

13.9%

+132

+2.0%

12,97848,529100.0%+51+0.1%@ 2024 MORITO CO.,LTD.

34

FY2024 2Q

Sales Composition by Region

2023 2Q

2024 2Q

Europe &the U.S.
13%

Europe &the U.S.
14%

Asia
15%
Japan
72%

Asia
17%

Japan
69%

The percentage for Asia increased year on year due to the end of
China’s zero-COVID policy and expansion of local procurement.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

35

FY2024 2Q

Sales Composition by Region & Business2023 2Q
Asia
13%
Asia
3%

Europe &the U.S.
19%

Japan
68%

Transportation
15%

Product
39%

Japan
97%

2024 2Q
Asia
15%
Japan
52%

Apparel
46%

Asia
4%

Europe &the U.S.
22%

Japan
63%
Transportation
15%

Japan
50%

ApparelAsia 25%

Europe &the U.S.
23%

48%

Product
37%

Japan
96%

Asia 28%

Europe &the U.S.
22%

The percentage for the product business decreased year on
year due to the streamlining of unprofitable businesses.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

36

FY2024 Full-Year Forecast

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

37

FY2024 2Q

Forecast & Progress

No changes have been made to the FY2024 forecast. Sales were slightly behind theforecast due to stagnant domestic consumption, especially in the apparel andproduct businesses, and production stoppages by automakers.
Profit margins increased more than projected.

FY2024 2Q

FY2024 Full-Year
Forecast

Progress

Net sales

23,79451,00046.7%

Operating profit

1,483

2,600

57.0%

Operating profit ratio

6.2%

5.1%

Ordinary profit

1,565

2,800

Ordinary profit ratio

6.6%

5.5%

Net income

1,393

2,300

Net income ratio

5.9%

4.5%

Where innovation is the norm

55.9%

60.6%

@ 2024 MORITO CO.,LTD.

38

FY2024

Outlook for the Second Half

Although there are uncertain factors such as temperature fluctuations, we will make efforts
to acquire new customers.
We already received some orders for the second half of the year.

ApparelBusiness

Product
Business

Transportation
BusinessJapan

Sales to new customers are expected mainly for environmentally friendly products. The impact of
inventory adjustments and manufacturers’ production cuts is expected to continue somewhat.
Sales of products for some brands will remain upbeat.

Asia

Sales of products for Europe and the U.S. will recover from the impact of inventory adjustments.
Efforts to promote local production for local consumption for products to be sold in the Japanesemarket are expected to continue.

Europe& theU.S.

Sales will recover from the impact of inventory adjustments. Acquisition of new customers is also
expected in Mexico.

Japan

Sales of products for one-coin shops will remain strong. The kitchen appliance-related services
business is also expected to remain robust. Sales of active sports-related products will be slow
due to the weak yen and inventory adjustments, but special demand related to the Olympics is
expected. We will withdraw from unprofitable businesses and improve profitability mainly in the
ODM and OEM businesses.

Japan

Automakers that stopped production in 1Q are expected to increase the pace of production to
make up for the loss by the end of FY2024. The impact of the certification test fraud by some
automakers is expected to be minor. There will be no new model launches, etc. for the rest of
FY2024.

Asia

We will continue to withdraw from unprofitable businesses in China.

Europe& the
U.S.

Where innovation is the norm

Sales are expected to increase due to the launch of mass-produced parts for new car models inNorth America. We will start withdrawing from some unprofitable businesses in Europe.

@ 2024 MORITO CO.,LTD.

39

Business Topics

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

40

8th Mid-term Management Plan
Progress in Local Production for Local Consumption Initiative
The initiative set forth as a growth strategy in the 8th Mid-Term Management Plan isunderway, targeting global brands in Japan. Local procurement for local sales haveincreased around the world.
We aim to establish a system for total local production, procurement, logistics, and sales
in selected production sites by FY2026, and increase sales volumes by improving
customer service and quality and strengthening relationships.
Current main sales channels for snap fasteners

Production

China (Shenzhen)

Procurement

China (Shanghai)/Hong Kong

Sales

Customers in Europe &the U.S./factories in Asia

Production control at each site = Quality differencesJapan

The U.S. (Georgia)

Morito’s operating companies
in JapanCustomers in North America

Customers in Japan and overseas

Future main sales channels for snap fasteners
Ensure Japan quality across the globe

Maintain current
scale/enhance production
efficiency

Production

China (Shenzhen)

Vietnam(Danang)

Procurement

China (Shanghai)/Hong Kong

ASEAN locations

Sales

Customers in Europe & the
U.S./factories in Asia

Customers in Europe & the
U.S./factories in ASEAN

Where innovation is the norm

Upgrade sewing
equipment
Install snap fastenerproduction line

Respond to ASEAN
procurement needs
and geopolitical risks
of Western brands

The U.S.
(Georgia)
MexicoCustomers in North America/
factories in Latin America

Enhance production
efficiency across the
board

Japan
(Key location)

Expand sales
channels in Latin
America and to meetthe needs of North
American brands

Morito’s operatingcompanies in Japan

Establish new R&D
bases for fasteners

Customers in Japanand overseas@ 2024 MORITO CO.,LTD.

41

Environmental Initiatives® FY2024 Products

We made progress in the initiative, including the development of a new product, MURON.
Our products have been attracting a lot of attention from various industries, and thenumber of adoptions is growing. The scale of business is expanding, with somecustomers having placed repeat orders.

Development
process

1. Collect discarded fishing nets
2. Remove debris from discarded fishing nets
3. Turn discarded fishing nets into recycled nylon resin
4. Chemically recycle recycled nylon resin*The images are for illustrative purposes only.

We developed MURON, a recycled fiber made entirely from discarded
fishing nets collected in Japan.

Bags and jackets using fabrics made from discarded fishingnets have been sold via Tsuhan Seikatsu since last year.

POLeR® keychains, promo items for Subaru,
use fabric made from discarded fishing nets.

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

42

® ASUKAMI ®

Environmental Initiatives

ASUKAMI®, a mixed paper made from sewing factory scraps, was used in the press kit
for TAAKK, a fashion brand by Takuya Morikawa. The press kit was distributed at Paris
Fashion Week held in June 2024. Tags made with ASUKAMI® will also be used for all
TAAKK products in the future.

Unwanted paper, fabric scraps
generated from the production
process, collected clothes, etc.

Reuse as new paper
products!

Finished
paper

Grinding
andpapermaking

Wastematerials

Collection

Waste materials are collected and sorted.

Scrap materials are pulverized and then incorporated into the papermaking process at apaper company to produce original recycled paper.

TAAKK’s press kit made from ASUKAMI®

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

43

Group Company Matex Inc. (Apparel Business)
Matex’s main business is printing. In addition to providing general commercial printing
services, the company delivers packaged apparel materials, including labels and tags to
be attached to finished products, worldwide. It will sell RFID tags to a major women’s
clothing brand in the second half of FY2024 and aims to market them to other vendors
as well. Currently, Matex is also working on industry-academia collaboration projects
using ASUKAMI®.

Industry-academia collaboration projects

RFID tags and laundry labels*RFID: A contact-free system that uses radio waves to read data on tags.
Multiple tags can be read at once.

Web production

Where innovation is the norm

Hotel amenities@ 2024 MORITO CO.,LTD.

44

Skateboard and Surfboard

Brands Handled

We import and sell items related to skateboarding and surfing, which are official
Olympic events.
We bring brands from the U.S., Australia, and other countries to Japan and carry
many items used by world-class athletes.

<Examples of skateboard brands handled><Examples of surf brands handled>

Emerica®

etnieses®

SEX WAX®
CHANNEL ISLANDS®
BAKER SKATEBOARDS®

SHAKE JUNT®

Where innovation is the norm

DEATHWISH®

DICKIES SKATEBOARDING

futures.®

CREATURES OF LEISURE®

@ 2024 MORITO CO.,LTD.

45

(FYI) Media Coverage● Rideeco® efforts were featured in the Kansai Bureau of Economy, Trade andIndustry’s “Rethink Design Report 2024” as a leading example.
https://www.kansai.meti.go.jp/3-6kankyo/RethinkDesign/RethinkDesign.html● Agreement between Choshi Electric Railway and Hisatsu Orange Railway, inwhich Morito Apparel participated, to address regional issues and the SDGs
was published in the Nihon Keizai Shimbun and other media.
https://www.nikkei.com/article/DGXZQOCC138NT0T10C24A3000000/● Morito Japan has signed a naming rights agreement for Hanshin Koshien
Stadium’s special limited seats for the 2024 season.
https://hanshintigers.jp/news/topics/info_9122.html● Morito was featured in Yahoo! News, etc. among companies riding the Paris
Olympics’ wave.
https://gendai.media/articles/-/129912

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

46

Shareholder Returns

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

47

Basic Dividend Policy
We regard returning profits to shareholders as one of the most importantmanagement issues, and determine the amount of dividends based on the following
policy, taking into consideration investment projects and financial conditions (netassets, etc.).

Realize stable andcontinuous
dividend payments

Dividend payout
ratio of 50% or
more
in relation to profit
attributable to owners ofparent is the standard

Continue to consider buying back shares whenever necessary
and canceling them appropriately

Where innovation is the norm

Standard for
dividend on equity(DOE) ratio of 4.0%
(on a consolidated
basis)*In a fiscal year with a significant fluctuation in after-tax
profit attributable to owners of parent due to special
factors such as extraordinary income or losses, thedividend amount will be determined in consideration of
the corresponding impact.

@ 2024 MORITO CO.,LTD.

48

Trends of Dividend, Dividend Payout Ratio & DOE

We adopted a revised basic dividend policy in FY2023

グラフ タイトル
60.0

Commemorative
Dividend (JPY)Net Income (JPY)

50.0

Forecast

Annual Ordinary
Dividend (JPY)

40.0
30.0

Forecast

20.0
10.0
0.0
2018

2019

2020

2021

2022

2023

2024
2024（予想）

12.5

14.0

4.7

14.0

16.7

22.1

17.5
23.0

25.0

26.0

18.0

26.0

29.0

55.0

58.0

12.5

13.0

13.25

9.0

13.5

27.0

29.0

12.5

13.0

4.75

17.0

18.5

28.0

29.0

配当性向（％）
Dividend payout ratio (%)

54.7

50.8

104.8

50.6

51.4

65.6

67.1

DOE（％）

2.1

2.2

1.5

2.2

2.4

3.9

4.0

Net income
当期純利益（億円）(100 MiIIion JPY)
AnnuaI dividend per share
年間配当（円／株）(JPY)
lnterimdividend per share
中間配当（円／株）(JPY)
Year-end
dividend per share
期末配当（円／株）(JPY)

Where innovation is the norm

(forecast)@ 2024 MORITO CO.,LTD.

49

Disclaimer
This handout has been prepared only for information purposes and is not intended to solicit
investment.
Although this handout is made with extreme care, its completeness cannot be guaranteed.
We assume no responsibility whatsoever for any damages resulting from the contents.
The financial results forecasts and forward-looking statements in this presentation are madewith information known as of the day of presentation and contain some potential risks anduncertainties.
Therefore, please be aware that the content of the forecasts may differ significantly from
actual results, due to various factors such as changes in the business environment.

Contact

4-2-4, Minami Honmachi, Chuo-ku, Osaka 541-0054 Japan

MORITO CO., LTD. Investor Relations/Public

E-mail: ir@morito.co.jp

Relations Department
Where innovation is the norm

@ 2024 MORITO CO.,LTD.

50

Where innovation is the norm

Where innovation is the norm

@ 2024 MORITO CO.,LTD.

51