This is a transcript of Takuma Co., Ltd. financial briefing for the fiscal year 2021 heldon May 25, 2022.
＜Speakers＞
Takuma Co., Ltd., the President and Representative Director and CEO, Hiroaki Nanjo
Table of Contents

Hiroaki Nanjo: Thank you very much for taking the time to attend Takuma Co., Ltd.
financial briefing for the fiscal year 2021. I'm Hiroaki Nanjo, President andRepresentative Director.
Following this table of contents, I will first explain the summary of today's briefing
session and then explain the consolidated results for the fiscal year 2021.

Financial Results Summary for FY2021 (Ended 3/2022)

For the fiscal year 2021, net sales were 134 billion yen, and ordinary profit was 10.6
billion yen. They decreased year on year. On the other hand, orders received reached arecord high of 192.2 billion yen, and the order backlog increased significantly to 445.3
billion yen. About 50 percent of the order backlog is long-term O &M, acomprehensive contract for operation management and maintenance for ten years ormore.
For the fiscal year 2022, we expect strong demand for municipal solid waste treatment
plants and biomass power plants, and we expect orders to total 170 billion yen. Net
sales and ordinary profit are expected to increase to 143 billion yen and 12.5 billion
yen, respectively.
Toward achieving Vision 2030, our long-term vision for 2030, we will maintain andexpand our EPC business and expand recurring revenue model businesses while aiming
for steady growth in each of our businesses. We will also grow our business in theenvironmental and energy field through new businesses and M&A.

Financial Highlights for FY2021 (Ended 3/2022)

We would like to provide details of our financial results for the fiscal year 2021. Salesand profit decreased from the previous fiscal year, mainly due to changes in the EPC
projects mix and rising prices of materials and machinery in the Domestic Environment
and Energy Business.
Orders received reached a record high of 192.2 billion yen, supported by strong
demand for the replacement of municipal solid waste treatment plants and theconstruction of biomass power plants. We have also been able to steadily receive
orders for EPC projects and long-term O & M, resulting in a significant increase in ourorder backlog.

FY2021(Ended 3/2022) | Breakdown by Segment

Results by segment are shown on the slide.

FY2021 (Ended 3/2022) | Domestic Environment and Energy Business Orders
Received / Order Backlog

Let's take a quick look at the results by segment. In the Domestic Environment andEnergy Business, orders received for the entire fiscal year remained stable due to strong
demand for the replacement of municipal solid waste treatment plants and theconstruction of biomass power plants. Of the total order backlog of 433.3 billion yen,long-term O & M has provided comprehensive operational management andmaintenance services for over ten years, accounting for about 50% of the total, and theorder backlog for recurring revenue model businesses is steadily increasing.

FY2021 (Ended 3/2022) | Domestic Environment and Energy Business Net Sales /Operating Profit

Net sales and operating profit decreased due to a change in the EPC project mix andrising prices of materials and machinery that prevented cost reductions fromprogressing as expected, despite steady growth in the recurring revenue modelbusiness.

FY2021 (Ended 3/2022) | Overseas Environment and Energy BusinessIn the Overseas Environment and Energy Business, we received an order in the thirdquarter for the renewal of a stoker for a waste-to-energy power plant in Taiwan while
we could not conduct sufficient sales activities due to the COVID-19 pandemic andmany clients had their plans postponed. Most of our sales in the last three years havebeen due to maintenance, and we intend to establish a system that will enable us toreceive orders for new and renewed projects continuously.

FY2021 (Ended 3/2022) | Package Boiler BusinessIn the Package Boiler Business, demand continued to fall due to the COVID-19
pandemic, mainly in the lodging industry, and orders received did not recover to preCOVID-19 levels. Although net sales decreased, operating expenses and other expenses
declined due to the constraints of operating activities, so profit slightly increased.

FY2021 (Ended 3/2022) | Equipment and Systems BusinessIn the Equipment and Systems Business, orders received for semiconductor industrial
equipment were firm. However, total segment orders decreased due to a decline indemand in the Building Equipment Business caused by the postponement of plans dueto the COVID-19 pandemic and a decrease in orders received due to the intensifiedcompetitive environment.
Net sales increased due to an increase in net sales of semiconductor industrial
equipment but operating profit decreased due to a decline in the building equipment
business.

Progress on 13th Medium-Term Management Plan

I would like to explain the progress of the 13 the Medium-Term Management Plan,
which began in fiscal 2021. We aim to achieve our medium-term target of 36 billion yen
in accumulated ordinary profit for three years, but the first year, fiscal 2021, was slightly
below our plan. Nevertheless, we aim to achieve our medium-term managementtargets by steadily accumulating orders.

13th Medium-Term Management Plan | Main Orders Received (FY2021)

This slide shows the main orders received in 2021. We have received orders for three
DBOs, one long-term O & M, and six biomass power plants.

13th Medium-Term Management Plan | Preparation for Growth

In preparation for growth, we are strengthening the recruitment and training of humanresources, mainly in the construction, engineering, and maintenance divisions involvedin the EPC and recurring revenue model businesses. We are also working on researchand development, including CO2 separation and capture and utilization technologies,
and improving added value through digital technologies.
As a significant capital investment, we are making steady progress in renewing theHarima Factory. The total amount of investment was approximately 13 billion yen. Ourgroup's capital investment forecast for fiscal 2022 is 9 billion yen, of which the majorityaccounts for this renewal project.

13th Medium-Term Management Plan | Human Resources Investment, R&D, andCapital Investment

This slide is showing investment transitions in human resources and R & D .

Market Environment | Municipal Solid Waste Treatment Plant (Domestic
Environment and Energy Business)

Let's look at the current market environment for our group's major businesses. In themunicipal solid waste treatment plant business, our mainstay business in the Domestic
Environment and Energy Business, there is a continuing demand for replacement andlonger service life due to aging facilities. The market size is indicated by the total waste
disposal capacity of the facilities ordered. Orders received for 3,000 to 4,000 tons per
day are expected to remain over the next five years.

Market Environment | Municipal Solid Waste Treatment Plant (Domestic
Environment and Energy Business)

An increasing number of orders are being placed by the DBO method, in which
operations after the completion of facilities are outsourced with the construction offacilities. Our group's O & M business is growing steadily. At the beginning of fiscal
2022, we received orders for 18 facilities, of which 12 are in operation. In addition toshort-term after-sales service, we will continue to capture demand for O & M, including
the DBO projects.

Market Environment | Energy Plants (Domestic Environment and Energy Business)

As for biomass power plants, which are the main products of energy plants, demand forthe construction of small- and medium-sized biomass power plants, mainly fordomestic materials, and maintenance after delivery is firm. In addition, there is ademand for fuel conversion due to rising energy prices and efforts to reduce CO2emissions, and we will capture these needs.
For biomass power generation projects with less than 10 MW, FIT plans are expected tocontinue. We expect a cautious stance with respect to use for the time being, as it
requires the consideration and response of power generation companies to the risks
involved.

Market Environment | Overseas Environment and Energy BusinessIn the Overseas Environment and Energy Business, there is a potentially robust demand
for waste-to-energy power generation in emerging countries due to population growthand urbanization. There are also moves to support government implementation of theproject. Although it is taking time to establish a market, we will continue to establish asystem, such as partnerships with local companies based in our local subsidiaries, toacquire orders.
In Thailand, the government is promoting the introduction of renewable energy
power generation, and the demand for biomass power generation, including for sugar
factories, is robust. We will continue to focus on orders for new construction, renewal,and maintenance projects.

Forecasts for FY2022(Ended 3/2023)

We would like to explain our forecast for the fiscal year 2022. Sales and profit areexpected to increase mainly due to an improvement in the composition of EPC projects
in the Domestic Environment and Energy Business.
Demand for municipal solid waste treatment plants and biomass power plants
continued to be strong. Although orders are expected to decrease from the previous
fiscal year, we will continue to aim for a high level of orders.
Although there are concerns about further increases in prices of materials andmachinery and longer delivery times, we will aim to achieve our profit target by taking
measures to reduce the impact, such as placing orders earlier and offering inflation
slides.
We do not expect a substantial improvement in the impact of COVID-19.
We are not directly impacted by the Russia/Ukraine situation.

FY2022 (Ended 3/2023) | Results Forecasts by Segment

By segment, we plan for the numbers on this slide. We will work hard to achieve thesegoals.

Shareholder Return

We have adopted a policy of returning profits to shareholders founded on the principleof maintaining a stable dividend while working to strengthen its constitution to ensurecompetitiveness in an increasingly challenging market and taking into account acomprehensive range of factors, including business performance.
The dividend for the current fiscal year is expected to be 36 yen, the same as theprevious fiscal year. The purchase of treasury stock is one of our options, and we
execute such purchases flexibly after making a comprehensive judgment based on thestock price and other factors.

In Closing

Finally, we are steadily expanding recurring revenue by such means as entering
comprehensive contracts for municipal solid waste treatment plant operations and newdeliveries of biomass power plants, so we expect recurring revenue model businesses
to grow as a stable revenue foundation.
We also believe the role that our Group, which offers technologies and services
primarily in the fields of environment and energy, plays will become more and more
important for achieving a decarbonized society and sustainable society.
Continuing to focus on environment and energy-related businesses as a major growthfield, we will pursue sustainable growth together with our customers and society via
ESG management. Thank you in advance for your understanding and support. Thankyou very much.