Ticker : ４６５１

for Energy , for Environment

SANIX
INCORPORAED
Environmental Resources
Development
Commercial Photovoltaic
Solution
From
FY2014 To FY2016

THE NEW MID-TERM BUSINESS PLAN

Sun Shine Plan 2016
Accelerating Shift to Energy and Environmental Development

MAY 29th,2014

Contents

Sun Shine Plan 2016

Page

1. Overview of Our Business3

2. Recognition and Prediction of the Business Environment
2-1 Market trend of PV in Japan12

3. Mid-Term Business Plan
3-1 Management Policies

21

3-2 Projection of Sales, Incomes and Investments

23

3-3 Dividends Policy

26

4. Plan Every Business Segments

4-1 Photovoltaic Solution Business28

4-2 Environmental Resources Development Business32

4-3 Sanitation Business34

5. Summary of Mid-Term Plan

35

6. Action to the Future

37(Note) Numbers are rounded off to the nearest whole number.

Sun Shine Plan 2016

1. Overview of Our Business1.Overview of Our Business
Overview of Business Segments

FY2013Sun Shine Plan 2016as of the end of March 2014

Solar Engineering (SE) Division former as Commercial PV(Photovoltaic) Solution Divisionsale and installation of PV system (commercial, house use)wholesale of PV components
other(operation of self mega-solar plant)
70 business sites(64 on West , 6 on East)
number of employee : 1,922
Western Japan SE section
Eastern Japan SE section

Environmental Resources Development(ERD) Division
Plastic recycling section
Organic waste water section
Subsidiaries
18 business sites

turn waste plastic into plastic fuelprocessing the organic waste water
operation of power plant and final disposal site
number of employee : 367

Home Sanitation (HS) Division
HS section

sanitation service to household
home foundation treatment

63 business sites

number of employee : 433

Establishment Sanitation (ES) Division
ES section
12 business sites

sanitation service and maintenance and management
to buildings and condominiums
number of employee : 140

number of employees on Headquarters : 429
2014-2016 Mid-Term Business Plan on May 29 2014

Group Total : 3,291-3-Copyright© SANIX INCORPORATEDFY2013
1.Overview of Our Business
Expansion of Sales Volume and Change of Sales Composition Sun Shine Plan 2016
CPS

FY2013

ERD

7.1%

HS

12.8%

ES

FY2012

9.1%

19.1%
22.2%

61.0%

FY2011
8.8%

34.2%

4.5%

37.8%
48.9%

34.5%

millions of yen
Sales 84,221
Operating Income 4,508
Number of employees 3,291

millions of yen
Sales 43,366
Operating Income 1,870
Number of employees 2,084

millions of yen
Sales 31,454
Operating Income 409
Number of employees 1,629

Sales raised to 2.7 times and operating income to 11times compared with FY2011
Indicated as the disclosed segment on FY2013

2014-2016 Mid-Term Business Plan on May 29 2014

The size of circles show the sales volumes-4-

Copyright© SANIX INCORPORATEDFY2013
1.Overview of Our Business
Expansion of Sales Volume and Change of Sales Composition Sun Shine Plan 2016
FY2011mi l l i ons of yen

1st Half

Net Salse
CPS
ERD
HS
ES
Op. Income
Op. margin

1.7%
15,452FY2012
2nd Half

15,452
731
5,243
8,137
1,341
266
1.7%

CPS
ERD
HS
ES
Op. margin

1st Half

16,001
680
6,647
7,258
1,416
143
0.9%

FY2013
2nd Half

18,184
896
7,411
8,423
1,452
524
2.9%

1st Half

25,181
8,713
7,555
6,399
2,512
1,346
5.3%

2nd Half

31,69215,155
7,848
6,088
2,600
1,495
4.7%

52,52936,183
8,202
4,730
3,410
3,012
5.7%

5.7%
52,529Million yen

5.3%
4.7%
31,6920.9%

2.9%
18,18425,181

1st Half

2nd Half

16,001

1st Half

2nd Half
FY2011

1st Half

FY2012

2nd Half
FY2013

CPS expanded rapidly from 2nd Half of FY2012
Indicated as the disclosed segment on FY2013

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

1.Overview of Our Business
Reporting Segments and Business Fields
FY20132014-2016 Mid-Term Business Plan on May 29 2014

FY2013Sun Shine Plan 2016

New reporting segment since April,2014-6-

Copyright© SANIX INCORPORATED

1.Overview of Our Business
Recent Situation of PV business

FY2013Sun Shine Plan 2016

End-to-End service ,from manufacturing of PV modules, inverters, mounting systemthrough sale, installation and maintenance●SE-West 64sites
Sales:286
Engineers:1,440

allied 7 warehouseas end of Mar.2014

solar modules sent directly fromthe storage of alliance transportcompany

FUKUOKA
warehouse

ONOMICHI
warehouse

YOKAWA
warehouse●SE-East 6sites
Sales:60
Engineers:41
as end of Mar.2014

TAKEO LogiCenter

KAMEYAMA
warehouse
OSAKA Logi-Center

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

1.Overview of Our BusinessPV system sale status by prefecture

FY2013Sun Shine Plan 2016

Total sale and Installation volume : 358.3MW (commercial and houseuse)as end of Mar 2014

The map indicates the total capacity sold ofcommercial PV system(direct-sale and installation, andwholesale) and residential PV system by prefecture.

under 1,000kW
1,000kW to 5,000kW
5,000kW to 10,000kW
10,000kW to 20,000kW
over 20,000kW
indicate business sites
2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

1.Overview of Our Business
The Features of our PV business

FY2013Sun Shine Plan 20161) End-to-end service, the development and manufacturing of PV modules,
inverters and mounting system and procuring other components
through sale installation and maintenance.
2) For focusing the PV system from 10kW to 1,000kW, stimulating thedemands of land or space owners and creating the new market.
3) The consistency and focusing to small and mid size system, we capture
the leading market share by price advantage.

a sample of roof mounting Commercial PV system

2014-2016 Mid-Term Business Plan on May 29 2014a sample of ground mounting Commercial PV system-9-

Copyright© SANIX INCORPORATED

1.Overview of Our Business
Operating Sites of ERD division

FY2013Sun Shine Plan 2016

Collects plastic generated during the production processes of industrial customers, and turns
the waste plastic it processes into fuel, which is then used in our power plant as fuelKK. C&R(Final Disposal Site)

HOKKAIDO SANIX ENV. INC.
(Waste Plastics Plant)

ERD●Waste Plastics Plants●Power Generation Plant●Final Disposal Site
Organic Waste Water Plant

15sites
1 site1 site1 siteSANIX ENERGY INC.
TOMAKOMAI POWER PLANTNIIGATAKASAOKAHIROSHIMAOHTAHIMEJITAGAJOHINO

FUKUSHIMAHIBIKITOMAKOMAI POWER PLANT
max output 74,000kW
Using Plastic fuel705 tons/day

MOHKA
HITACHINAKA

FUJI
OKAZAKISODEGAURA

Amount of plastic
processing
FY2011 348,854 tons/year
FY2012 370,362 tons/year
FY2013 404,794 tons/year

SUZUKA
2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATEDSun Shine Plan 2016

2. Recognition and Prediction of
the Business Environment

2-1 Market trend of PV in Japan
Electricity Generation
Changes of electricity generation
Generation of Electric Energy(100million kWh)

9,355

9,705

9,889

9,958

FY2013Sun Shine Plan 2016as a file of "The Federation of Electric Power Companies of Japan(FEPC)"

10,305

Great Earthquake

9,915

9,565

10,064

9,550

9,408

9,397

1.6%
Hydro
8.4%

2.2%
Hydro
8.5%

New Ene.
10.7%

Oils
14.9%

New Energy etc.
Hydro
Oils
LNG
Coal
Nuclear

LNG
43.2%

Thermal
88.3%

Coal
30.3%

Nuclear1.0%

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

'Japan has little domestic fossil fuel which plays a center role of energy source, and has the vulnerability to depend
on import from abroad. It causes Japan to have the energy structure which is easily affected fromdomestic/international situation of energy. It is essential for security of states to secure stable supply of energy as
blood vessel, and this always remains a big issue for Japan. Besides, under the situation where international
geopolitical structure faces a big change, the circumstance surrounding Japan’s energy security becomes severer.'
Referred from Introduction of Strategic Energy Plan of GOJ April,2014

It is in the tight situation of electricity supply due to the shutdown of the nuclear power plants
2014-2016 Mid-Term Business Plan on May 29 2014

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2-1 Market trend of PV in JapanThe Energy Policy of Government and Prediction of Introduction

FY2013Sun Shine Plan 2016

Position of renewable energy on the new Strategic Energy Plan of Government of Japan

GOJ has accelerated the introduction of renewable energy as far as possible
for three years since 2013 followed by continuous active promotion.
GOJ pursues the higher levels of introducing renewable energy than the levels which were indicatedbased on the former Strategic Energy Plans.
Indicates the ratio of renewable energy in total watt-hour in 2030:appoximately 20%(214billion kWh)as in 2012 it indicates about 10%(including Hydro)

The prediction of introduction for commercial PV system to 2030 by JPEA(Japan Photovoltaic Energy Association)
Yearly introducing amount(GW)

6
5
4
3

over 1,000kW
50-1,000kW
10-50kW2
102013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030
Referred from "JPEA PV OUTLOOK 2030" arranged by MIZUHO Research Institute

Cumulative introduction amount in Japan as of 2020:49GW , 2030:102GW
2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

2-1 Market trend of PV in Japan
Status of Introduction

FY2013Sun Shine Plan 2016

Combined total capacity ofcomposition
facilities before July 1, 2012
PV(for Household)PV(for Commercial)
Wind and others
TOTAL

about 4,700,000 kW
about 900,000 kW
about 15,000,000 kW
about 20,600,000 kW

Certification by METI and Introduction of Commercial PV

500

産業用（10kW以上）

total capacity of certification2013 (fo scale on right side ）
Jan.
Feb.
Mar.
Apr.
under 1MW
Certification
under
by
METI
1MW
257
458
619
over 1MW
400
Introducing Capacity（10,000kW）

over 1MW
318
644
1,249
導入済み under 1MW
23
3151
over 1MW
8
11
19
total
capacityof
introduction(for
scale
on
left
side)
Introduction
underRatio1MW
88
68
83
300
over under
1MW 1MW(total 3..96GW）
25
17
15
22.8%
over 1MW(total 1.79GW）
Introduction Ratio under 1MW

200

22.8%
27.2%
4.4%
72.8%

After the Feed-in Tariff Scheme
Combined total capacity offacilitiesfrom July 1, 2012, composition
to Feb.28 2014
about 2,190,000 kW
26.9%
97.5%
about 5,760,000 kW
70.7%
about 210,000 kW
2.6%
about 8,150,000 kW

May
623
1,287
96
36
154
26.0%
28

Jun.
637
1,300
122
44
29.2%
192
34

Jul.

Aug.

2000

Sep.

1500

Oct.

657
686
720
1,319
1,345
1,364
150 32.7% 179 32.0% 211
31.6%
31.2%
50
61
73
228
260
292
38
45
54

762
1,372
240
86
28.9%
315
62

8.9%

9.6%

10.2%

Nov.

Dec.

Jan.

Nov.
840
1,409
275
108
327
77
23.6%

Certificated capacity（10,000kW）

Before the Feed-in Tariff Scheme

952
1,455
305
500
129
320
0
88
1000

19.2%

Introduction Ratio over 1MW

100

8.8%

6.8%

8.3%

2.5%

1.7%

1.5%

Jan.

Feb.

Mar.

15.4%

2.8%

3.4%

3.8%

Apr.

May

Jun.

4.5%

5.4%

6.2%

Jul.

Aug.

Sep.

7.7%

9.1%

0

Oct.

Feb.

'Introduction Ratio' means the rate of Introduced Capacity against Certificated Capacity.

2013

2014

The company arranged data of 'Present Status and Promotion Measures for the introduction of Renewable Energy in Japan'(METI)

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

2-1 Market trend of PV in Japan
Advantage and Disadvantage of Renewable Energy TypeType

advantages

FY2013Sun Shine Plan 2016

disadvantages

Huge amount of introducing potential.
Daytime generation which have large
demand.
Short time to installation.
Relatively low cost installation.

Relatively high cost for generation.
Generation depend on sun light.

Wind

Low cost at large size development.

Suitable areas location limited.
The wind is not always predictable.
Long development period 5 to 10 years.

Geothermal

Japan has the third largest volume ofgeothermal resources in the world.
Relatively stable generation.
Relatively low cost for generation.

Most geothermal resources are located in naturalparks.
Long development period about over 10years.
A huge development cost.

SmallmediumHydro

Much more reliable than wind, solar orwave power.
Relatively small areas for the power
generation facilities.

Finding a suitable site can be difficult.

Biomass

It makes sense to use waste materials
where we can.
Relatively stable generation.

Collecting or growing the fuel in sufficientquantities can be difficult.

Solar
(PV)

The company arranged file of Agency of National Resources and Energy

PV is a suitable renewable energy for Japan
2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

2-1 Market trend of PV in Japan
Introducing Potential by Studying of Free Spaces for PV (1)FY2013Sun Shine Plan 2016

Introducing potential by a study of suitable spaces for commercial PV system
As a result of test calculating for introducing potential of commercial PV systemby free spaces, total introducing potential is about 161GW

high possibility potential

Potential 729GW

568GW

public facilities
0.4%

Relatively low possibility

3%apartment
2%

cultivated land
55%

Fields Type
Relatively high possibility

private vacant
161GW
transportation
space
facilities
commercial
8% corporate vacant4%
facilities
space2%
7% land no longer
open space other facilities
cultivatedabove water
3%
5%
10%
roof of industrial
facilities
1%householdarea

potential

Square kmMWprivate vacant space

631

54,645

corporate vacant space

581

50,315land no longer cultivated396

34,294commercial facilities

133

11,518roof of industrial facilities

117

10,132

subtotal

1,858

160,904

household158

18,410apartments

133

15,485public facilities

41

3,551

cultivated land

4,629

404,012

openspace above waters

855

74,043transportation facilities

324

28,376other facilities

275

23,815subtotal

6,415

567,692

TOTAL

8,273

728,596

Study and calculated by MIZUHO Research Institute.

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

2-1 Market trend of PV in Japan
Introducing Potential by Studying of Free Spaces for PV (2)FY2013Sun Shine Plan 2016

Test calculating after 'promising potential' considered of the climatic elements
Eastern Japan
Southern KYUSHU
5.4%
HOKKAIDO TOHOKU
64GWWestern KYUSHU
7.2%
MIYAZAKI, 4.2%
3.6%
KAGOSHIMA,(46.0%)

OKINAWA

Northern KYUSHU SAGA,NAGASAKI
7.8%(ref.)introduced capacity of commercial PV

KANTO(1)14.1%

FUKUOKA, OHITAKUMAMOTOSHIKOKU5.5%

CHUGOKU
10.2%

SAITAMA, IBARAKI,TOCHIGI, GUNMA

Promising potential
TOTAL139GW

KANTO (2)8.7%TOKYO, CHIBA

KANTO (3)
6.6%

KANSAI
10.9%

Western Japan

75GW

KANAGAWA,YAMANASHI,SHIZUOKACHUKYO
10.8%'Promising potentisal' will be the potential
subtract 50% of HOKKAIDO, TOHOKU, andHOKURIKU as snowfall areas from 161GW
before page. It's calculated 139GW.

Eastern Japan
HOKKAIDO
Southern
3.1%
KYUSHU
Western 8.9%
(37.1%)TOHOKUKYUSHU
4.6% KANTO(1)4.1%
Nothern
15.0%
KYUSHU
12.1%
Introduced
KANTO(2)2.13GW

SHIKOKU
5.9%

HOKURIKU
5.1%

CHUGOKU
8.9%
KANSAI
10.2%

Western Japan

4.1%
KANTO(3)2.2%
HOKURIKU
8.0%

CHUKYO
12.8%

3.62GW(54.0%)(62.9%)

Study and calculated by MIZUHO Research Institute.

2014-2016 Mid-Term Business Plan on May 29 2014

capacity
5.75GW- 17 -

as end of Feb.2014, data of METI
Copyright© SANIX INCORPORATED

2-1 Market trend of PV in Japan(reference) Change of FIT scheme of Germany
Change of tariff price and introducing status in Germany

FY2013Sun Shine Plan 2016

The company arranged data of METI and German Solar Industry Association

90
Price
(JPY)

price of PV system in Germany

663,000Yen(5,100€/kWp)

80

74.6
70.9

70

65.8
62.5

56.4

30

New criteria since Apr.2012

40

60.8
63.4

59.4

55.9

60.2

Germany All size
Germany Roof mounting under 30kW

50

64.0

66.7

59.4

60

67.3

70.2

56.4

57.2
52.8

50.9

49.3

53.2
46.1

Germany Roof mounting 30 to 100kW
Germany Roof mounting 100 to 1,000kW

41.5

Germany Roof mounting over 1,000kW
Germany Roof mounting under 10kW

42.1

42.9
40.8 37.4

37.0

Germany Roof mounting 10 to 40kW
Germany Roof mounting 40 to 1,000kW

tariff price in Japan(JPY)
under 10kW
42.0
over 10kW

44.3

48.4

32.5 35.5
31.5
27.4

Germany Ground mounting ** since Apr.2012, over 10MW were excluded from FIT scheme.

20

38.0

40.0

36.0

31.8

30.2
25.424.623.9
22.1
23.3
20.7
17.6

electric bill in Germany

7.41

10

7.50

17.0

7.6016.5 15.3

37.0
32.0

213,000Yen(1,640€/kWp)

Capa.
(GW)
10

14.3

Installed in JAPANYearly introduced capacity in Germany

3.80
0

Total introducing capacity of 2013 in Germany is about 37GW

0.14

0.93

0.85

1.27

1.94

5

1.67

Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Aug.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.
Jan.
Apr.
Jul.
Oct.

0.11

0.66

3.30 6.30(forecast)

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

Tariff price, electric bill and system price in Germany calculated as 130JPY for 1Euro. 'Price of PV system in Germany' is total cost of PV system up to 10kW roof-mounting excluded tax.

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATEDFY2013
2-1 Market trend of PV in JapanSun Shine Plan 2016
Prediction for Introducing Commercial PV system
MIZUHO Research Institute predicted the yearly introducing capacity of commercial PV system
adding recent status of introducing to JPEA's prediction.
Prediction of every capacity category

Predicted by MIZUHO R.I. Mar.2014

10 to 50kW

UNIT:GW

Predicted by JPEA Dec. 2013

5.55

5.84

FY2014FY2015FY2016FY2017over 1,000kW

1.57
1.37

2.05

1.95

1.93

2.14

2.03

FY2013

FY2014FY20151.86

4.86

FY2013

1.65

1.76

5.55

50 to 1000kW

GW

FY20181.71
1.78

FY2016Predicted by MIZUHO R.I.

FY2019FY2020Total introducing capacity by JPEA are 2020:49GW , 2030:102GW (residential and commercial)
JPEA prediction on 'JPEA PV OUTLOOK 2030'

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATEDSun Shine Plan 2016

3. Mid-Term Business Plan

3-1 Management Policies

FY2013

Mid-Term management policy

Sun Shine Plan 2016

We contribute to the society through Energy and Environmental BusinessWe contribute to society on spread of eco-friendly energy and resource recycling power generation based on
experiences and high reliability.

for Energy, for Environment

Energy and Environment
FOR SANITARY AMENITY
Sanitation andEnvironmental
business

Solar power generation
Resource recycling power generation
Electricity retail and wholesale

This Mid-Term 3 years (FY2014-2016）
until last fiscal year
2014-2016 Mid-Term Business Plan on May 29 2014

- 21 -

Copyright© SANIX INCORPORATED

3-1 Management Policies

FY2013Sun Shine Plan 2016

Promotions for growth and profit maximization

1.Expansion of commercial PV business・Precise response and expansion of shares in the West Japan area
・Strengthening development of direct installation systems and expansion of shares in the
East Japan area
・Promotion of self-manufacturing of main components such as PV module and inverter
・Promotion of cost reduction in increased installation of high-voltage projects from thebusiness term ending in March 2015

2.Expansion of resource recycling power generation
・Improvement quality of plastic fuel and increased operation efficiency at power plants
・Expansion of capacity by reinforce plastic treatment facilities
・Start of biomass power generation that uses organic waste processing (HIBIKI Plant)

3.Full-fledged launch of electricity retailing and wholesale business・Entry into the retail business with a focus on liberalization of electricity retailing in 20162014-2016 Mid-Term Business Plan on May 29 2014- 22 -

Copyright© SANIX INCORPORATED

3-2 Projection of Sales, Income and Investment
Sales and Income of GROUPFY2013Sun Shine Plan 2016

Target of consolidated sales and Incomes

FY2014
forecast

FY2015projection

FY2016
projection

84,221

161,500

251,000

330,000

194.2%

191.8%

155.4%

131.5%

21,421

38,60056,00072,500Gross Profit margin

25.4%

23.9%

22.3%

22.0%

Operating Income

4,508

14,00024,00034,000YOY

241.0%

310.5%

171.4%

141.7%

Operating margin

5.4%

8.7%

9.6%

10.3%

Ordinary Income

4,309

13,80023,00032,500Net Income

2,964

8,830

14,00020,000

3.5%

5.5%

5.6%

6.1%

Millions of yen

Net Sales
YOY

Gross Profit

FY2013
results

Net Income margin

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

3-2 Projection of Sales, Income and Investment
Sales and Incomes by Segments

FY2013Sun Shine Plan 2016

Target of Sales and Incomes by divisions
FY2013Results compsn

FY2014FY2015
Forecasts compsn Projection compsn

FY2016
Projection compsn

Net Sales
SEERD
HS and ES

84,221
51,34016,051
16,829

61.0%
19.1%
20.0%

161,500
136,912
16,410
8,178

92.1%
5.6%
2.4%

Gross Profit

21,421

25.4%

SG&A

16,912

20.1%

Op. Income
SE
ERD
HS and ES
Group

5.4%
4,508
4,410 (8.6%)
1,364 (8.5%)
1,331 (7.9%)(2,598)

84.8%
10.2%
5.1%

251,000
225,820
17,120
8,060

90.0%
6.8%
3.2%

330,000
303,810
18,3707,820

38,60023.9%

56,00022.3%

72,50022.0%

24,60015.2%

32,00012.7%

38,50011.7%

8.7%
14,00014,468 (10.6%)
1,440 (8.8%)
1,380 (16.9%)(3,288)9.6%
24,00025,470 (11.3%)
2,080 (12.1%)
1,200 (14.9%)(4,750)34,000 10.3%
36,670 (12.1%)
2,520 (13.7%)
1,000 (12.8%)(6,190)(note) The underlined percentage indicate Operating margin of each segment.
(note) It shows the numbers of former CPS segment on SE of FY2013 results.
(note) Because the sales on forecasts and projections of SE segment include the sales of residential PV systemthat was included in the sales of HS and ES segment, a simple comparison is not possible except ERD segment.

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

3-2 Projection of Sales, Income and Investment
Plan for CAPEX and R&D

FY2013Sun Shine Plan 2016

Plan for Capital Expenditure
Millions of Yen

SE division
reinforcement of PV module factory
reinforcement and new establishment of inverter factory
ERD division
for quality improvement<plastic>
preparation for new plants<plastic>
biomass generation system<organic water>

FY2014FY2015FY2016

850
845
115
1,000

Headquarters
new training center at Kanto region

500

CAPEX Total

2,500

3,500

5,000

FY2014FY2015FY2016

1,500

2,050

Plan for R&D
Millions of Yen

monitering system
Inverters
construction efficiency improvement
secondary battery

100
230
200

R&D Total

660

After indicate the plan amount of money of some plans that have clear details, the total plan amount are on the yearly total.

2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

3-3 Dividends policy

FY2013Sun Shine Plan 2016

Basic Policy Regarding Distribution of Profits
At our company, increasing the profits of our shareholders is one of the mostimportant issues for our management. In terms of the distribution of profits, ourfundamental purpose is to maintain stable dividends, while also comprehensively
taking into account the performance of management and the dividend payout ratio.
We are constantly striving to meet the expectations of our shareholders.
We are in the act of paying no dividend since FY2005, the company intend to realize
resumption of dividend early.

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Copyright© SANIX INCORPORATEDSun Shine Plan 2016

4. Plan Every Business Segments

4-1 Photovoltaic Solution Business
Sales Projections and Main Issue

FY2013Sun Shine Plan 2016

Sales Projection and Main Issue of SE division
Millions of Yen

FY2014 Forecasts
Sales
Op.Income

FY2015 Projection
Sales
Op.Income

FY2016 Projection
Sales
Op.Income

136,912

225,820

303,810

14,4681) structure reinforcement at West36,670

1) structure reinforcement at West1) structure reinforcement at Weststrengthening business activities

strengthening business activities

2) structure reinforcement at East2) structure reinforcement at East2) structure reinforcement at Eastestablish new business sites

strengthening business activities

strengthening business activities

3) introducing maintenance business3) enhancement maintenance business

reinforce of sales staff and engineer

reinforce of sales staff and engineer

main issue

25,4703) boost capacity of PV module produce
reinforce the Shanghai factory4) in-house production of Inverter4) boost production capacityof PV module 4) continuous development of Inverter5) continuous development of Inverter

establish the mass production system

5) introducing battery business6) development of secondary battery5) cost down for manage increasing
high-voltage system
6) development of monitoring system
7) reinforce the logistic systemestablish logi-center in Kanto region

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Copyright© SANIX INCORPORATED

4-1 Photovoltaic Solution BusinessBusiness Sites and Manpower Planning

FY2013Sun Shine Plan 2016

SE division : Sites and Staffs●SE-West 64 sites
Sales : 286
Engineers : 1440
as end of Mar.2014

Sales : 690
Engineers : 2,800
Establish the training centeras end of Mar.2015

Sales : 690
Engineers : 3,600●SE-East 6 sites

a new training center at Kanto region on FY2014

Sales : 60
Engineers : 41

as end of Mar.2017

as end of Mar.2014

Sales : 200
Engineers : 540

Logi-sites

as end of Mar.2015

Sales : 300
Engineers : 1,500
as end of Mar.2017

Establish the TAKEO factory #2

Reinforce the Logi-sysetm●

15 to 20 sites

produce about 60MW Inverters on a month with TAKEO factory #1 and #2(from FY2014)2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

4-1 Photovoltaic Solution Business
Cost Price Control Plan

FY2013Sun Shine Plan 2016

Control the cost price in response to the drop of the tariff priceitems

present condition

Mid-Term counter plan

Procure from Shanghai subsidiary factoryand outside companies.
Shanghai has capacity of 60MW per year.

Enforce the production capacity of
Shanghai factory.

Procure from domestic inverter maker.

Develop and produce in-house, anddevelop continuously for cost cut andfunction improvement.
Cost down for manage high-voltage PV
system.

Mounting system

Self development and procure from OEM
vendors.

Cost cut according to change of use steel
materials.
Develop some new mounting system for
installation efficiency improvement.

CablesProcure from domestic dealers or sub
dealers.

Bring the products from overseas directly.

Logistics

2 Logi-center(KYUSHU and OSAKA) and 4
warehouses.
Unload components from overseas at
FUKUOKA port and transport to each sites
and installing fields.

Establish a new Logi-center at KANTO
region and build more warehouses. Unload
components at the ports near each Logicenter and warehouses.

PV module

Inverter2014-2016 Mid-Term Business Plan on May 29 2014

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Copyright© SANIX INCORPORATED

4-1 Photovoltaic Solution BusinessNumeric Value Plan on SE division
SE division
Millions of Yen

Net Sales
Op. Income

FY2014
Forecasts

FY2013Sun Shine Plan 2016

FY2015YOY

Projection

136,912 162.6%
14,468 282.3%

FY2016YOY

225,820 164.9%
25,470 176.0%

Projection

YOY

303,810 134.5%
36,670 144.0%

Op. margin

10.6%

11.3%

12.1%

Install volume

585MW

980MW

1,335MWestimated Share

14.0%

24.6%

38.3%

as end of the fiscal year

as end of the fiscal year

as end of the fiscal year

890
3,340

990
4,450

990
5,100

manpower plansales
engineers

261.8%
230.3%

111.2%
133.2%

100.0%
114.6%The denomi na tors of es tima ted s ha re a re the perdi ction ca pa ci ty on pa ge 19.(up to 1MW)

Expansion of shares in Western and Eastern Japan
In the Western Japan area, precise response and expansion of shares . And aim to high level operating
margin according to installation efficiency improvement by effective deployment of engineers to be thecore business.
In the Eastern Japan area, strengthening development of direct installation systems and enhancebusiness cover areas and expansion of shares .

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Copyright© SANIX INCORPORATEDFY2013
4-2 Environmental Resources Development Business
Sun Shine Plan 2016
Sales Projections and Main Issue

Sales Projection and Main Issue of ERD division
単位：百万円FY2014 Forecasts
Sales
Op.Income

FY2015 Projection
Sales
Op.Income

FY2016 Projection
Sales
Op.Income

16,41017,12018,370

1,440

2,520

<plastic><plastic><plastic>

1) improvement of plastic quality

1) improvement of plastic quality

1) improvement of plastic quality

improvement of existing facilities
2) Expansion of capacity

Main Issue

2,080

improvement of existing facilities
2) Expansion of capacity

preparations for facilities enlargement

2) Expansion of capacity

facilities enlargement

preparations for new plants<power generation><power generation><power generation>1) Increased operation efficiency

1) Full scale entry to the electricity

1) Enhancement the electricity retail

retail business

2) Entry into the electricity retailbusinessbusiness<waste organic water><waste organic water>

1) startup the volume reducing

1) startup the biomass generation

facilities

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Copyright© SANIX INCORPORATEDFY2013
4-2 Environmental Resources Development Business
Sun Shine Plan 2016
Numeric Value Plan on ERD division

ERD division
Millions of Yen

Net Sales
Plastic
Power
Organic
Dispo.etc.
Op. Income
Op.margin

FY2014
Forecast

16,41010,505
3,497
1,845
563
1,440

FY2015YOY

Projection

17,120
11,100
3,600
1,850
570
2,080

102.2%
102.6%
102.4%
104.4%
89.6%
105.6%

8.8%

FY2016YOY

Projection

104.3%
105.7%
102.9%
100.3%
101.2%
144.4%

12.1%

18,37012,200
3,700
1,900
570
2,520

YOY
107.3%
109.9%
102.8%
102.7%
100.0%
121.2%

13.7%'Plastic' means plastic fuel , 'Power' means power generation, 'Organic' meansorganic waste water recycled, and 'Dispo. etc.' means final disposal and others.

Preparing to next growth step according to improvement quality of plastic fuel.
On the resource recycling power generation business, increased operation efficiency at power plant byimprovement quality of plastic fuel. And entry into the electricity retail business with a focus onliberalization of electricity retailing.
And on the organic waste water recycling business, start of biomass power generation that uses organic
waste processing.

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Copyright© SANIX INCORPORATED

4-3 Sanitation BusinessNumeric Value Plan on HS and ES division
HS & ESMillions of Yen

Net Sales
Op. Income
Op. margin

FY2014
Forecasts

8,178
1,380

FY2015YOY

Projection

8,060
1,200

71.3%

-

16.9%

14.9%

FY2013Sun Shine Plan 2016

FY2016
YOY
98.6%
87.0%

Projection

7,820
1,000

YOY
97.0%
83.3%

12.8%

Keep on the business system and certain maintenance duties
Maintain the quick system met precisely for maintenance and the order from existing customers as
before on both HS and ES.

(note) YOY on the table are calculating after discounted the sales of residential PV system that was included in thesales of HS and ES divisions at FY2013. As for it cannot calculate accurate value of operating income, YOY shows bars.

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5 Summary of Mid-Term Plan

FY2013Sun Shine Plan 2016

Period of preparations to full-scale growth
and the next growth
Sales (100million yen)

3,500

3,000

We contribute to society on spread of eco-friendly
energy and resource recycling power generation
based on experiences and high reliability.

2,500

We are here now

Challenge forthe sustained
growthPeriod of a change andgrowth preparations of thebusiness structure

2,000

1,500

To next
growth1,000
A decade of maintenance and the improvement of the existing business

500

02003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Fiscal year
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Copyright© SANIX INCORPORATEDSun Shine Plan 2016

6. Action to the Future

6 Action to the Future
Main Strategy on the Next Mid-term Business Plan

FY2013Sun Shine Plan 2016

Extend the share of the PV market
Expanding price competitiveness and extend the share of the PV market in Japan
still more

Establish maintenance business for PV system
Establishment maintenance business for existing commercial PV system

Development the PV outskirts fields such as secondary battery
Start up the business of PV outskirts fields such as secondary battery withmatching the change of the FIT scheme.

Enhanced the resource recycling power generation business
Finished the preparation for expansion of plastic plants and the power plantand start to scale expansion.

Full-fledged launch of electricity retailing and wholesale businessMeasuring the profit expansion in the field of retail and wholesale of theelectricity that assumed the own thermal power plant and the stocking fromexisting PV power generation facilities as the main power supply.

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Copyright© SANIX INCORPORATED

6 Action to the Future(reference)Electricity System Reform by GOJ

FY2013Sun Shine Plan 2016

Roadmap for Electricity System Reform
Stage 1
Setting up of OCCTO

2014

Stage 2

Stage 3
Neutralization of power transmission, abolitionof rate schedule

Liberalization of retail entry

2015
Establishment of theOrganization for Crossregional Coordination ofTransmission
Operators(OCCTO)

2016

2017

2018 to 2020

(1) Formulation of a wide-area supply and demand plan
(2) Formulation of establishment plans for linkage lines and wide-area power transmission lines(3) Wide-area management of supply and demand and system(to be started as soon as the system will have been made ready)(4) Supply and demand adjustment at the time of emergency and when supply-demand is tight

Period of transitional arrangement for
rate schedule

Full retail competition

Vitalization of wholesale electricity market

Abolition of tariff
regulation

Abolition of wholesale
regulations
Creation of a one-hour
ago market

Wide area supply-demand adjustment will be enabled until
immediately before the supply and demand are actually traded bymaking the most of the market
Creation of a real-time market
Realization of
Legal unbundling ofcompetitivetransmission andmarketdistribution departments
environment
The company arranged the file of METI

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Copyright© SANIX INCORPORATED

6 Action to the Future
Development the Energy Business

FY2013Sun Shine Plan 2016

For new business development, we get ready for all possible measures on this three years
Power
Transmission

Generation

Blanket Purchase
and Sale

Own Power Plants

Outer Power Plants
Sale and Installationof PV system

Installedcommercial PV
facilities
as end of Mar.2014(213MW)
Other Powers

Existing BusinessCandidate of Business

Customers
Factories
andBuildings

Households

About 300,000
existing customers

Sanitation Services(HS and ES)

Electric Utilities Company

2014-2016 Mid-Term Business Plan on May 29 2014

Electricity Sale

Mega-solar

Provide the EMS
Electric Utilities Company

Biomass
Generation(pnanning)

Sale of Secondary
Battery

Electricity Purchase

Organic waste Water
Recycling

TOMAKOMAI Power
Plant
Renewable energy power generation

Plastic Plants- 39 -

Copyright© SANIX INCORPORATED

for Energy , for Environment
Disclaimer
This material contains certain forward-looking statements. Such forward-looking statements are not intended to provide
guarantees of our future performance and are based on certain assumptions and management’s judgment based on currently
available information. Therefore, actual results in future earnings and operating results may materially differ from those containedin the forward-looking statements.
The following items are among the factors that could cause actual results to differ materially from the forward-looking statementsin this material:changes in economic environment in Japan and abroad, business condition in Japanese manufacturingindustry, competition with other manufacturers, changing technology, regulatory environment, new legislation and anyother factors which are beyond our control.
In addition, this presentation is not intended to solicit investment to securities issued by us. We assume no responsibility for any
losses and liabilities that may be incurred because of information contained in this material.
CONTACT
Management and Planning Division
SANIX INCORPORATEDEmail : w961185@sanix.co.jp
TEL : +81(92)436-8882