Nissan Chemical Corporation
4Q FY2021 Financial Results Briefing and Long & Mid-term Business Plan Announcement
Presenter:
YAGI Shinsuke Representative Director, President & COO
MIYAZAKI Junichi Director
May 13, 2022

Miyazaki: Please see page 4.
A summary of the results is shown on pages 5 and 6.
These results are for FY2021. Operating profit increased JPY8.5 billion to JPY51.0 billion. Net income increased
JPY5.3 billion to JPY38.8 billion.
Operating profit and ordinary income reached record highs for the 8th consecutive year, and net income forthe 9th consecutive year. Despite the effects of the coronavirus pandemic, the Company achieved its midterm plan, with an ROE of 19.2%.
The next section of the page is a comparison between our actual results and the February Outlook. Operating
profit was up JPY1.0 billion and net income was up JPY1.5 billion.
As for shareholder returns, the full-year dividend will be JPY122 per share, an increase of JPY18. This is the10th consecutive year of dividend increases. The Company repurchased JPY12.0 billion of its own shares in
the fiscal year, resulting in a dividend payout ratio of 44.9% and a total payout ratio of 75.6%.

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Please see page 7.
This is an analysis of changes in operating profit of FY2021. As you can see, while profit increased YoY by
JPY8.5 billion, the increase was substantial in the Chemicals and Performance Materials segments. The
increase in Agrochemicals sales exceeded our Outlook JPY1.0 billion, with the exception of a downward swing
in Fluralaner shipments, which was partially delayed to FY2022.

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Please see page 9. This is the Outlook for FY2022. The figures are on page 10. Our assumptions for the Outlook
are an exchange rate of JPY115 to the USD and a crude oil price of USD88.
For the full year, we forecast an increase in operating profit by JPY2.5 billion, up to JPY53.5 billion. Net income
is forecast to increase by JPY0.8 billion to JPY39.6 billion. If we achieve these targets, it will be the 9thconsecutive year of record-high operating profit and ordinary income, and the 10th consecutive year ofrecord-high net income. We forecast an ROE of 18.7%.
Next, forecast shareholder returns. Based on the new mid-term plan, which will be presented later by Mr.
Yagi, the total payout ratio will remain unchanged at 75%. The dividend payout ratio will increase from 45%
to 55%. The dividend amount itself will increase by JPY32, from JPY122 to JPY154. We have increased
dividends for 11 consecutive years, and today we announced a JPY5.0 billion share buyback.

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Please see page 11. This is the forecast change in operating profit for FY2022. For the full year, we forecast an
increase of JPY2.5 billion. We expect profits in all segments with the exception of Chemicals to increase. We
forecast a decrease in profits in the Chemicals segment.

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Next, page 21. I will begin the segment analysis from page 21, but first I would like to mention theorganizational changes.
The changes are to the organization of the Pharmaceuticals Division, Planning and Development Division, andLife Science Materials Department. As shown on the left<before>, the R&D functions for Drug Discovery werepreviously located in the Pharmaceuticals Division, and that for medical materials was in the Planning andDevelopment Division. However, these functions have now been consolidated into the Planning andDevelopment Division and renamed the Healthcare Business Development Department.
The Pharmaceuticals Division has been renamed the Healthcare Division. This Division will concentrate onsales functions relating to pharmaceuticals and medical supplies. Therefore, all expenses related toconventional Drug Discovery research will be transferred to the Planning and Development Division fromFY2022 onward. The Planning and Development Division is included in “Trading, Others, Adjustment”. This iswhere the adjustments take place.

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Pages 22 to 24 show the figures by segment. We will now move on to page 26 for the Chemicals segment.
First, Fine Chemicals. Although sales were up 15% in the second half of FY2021, they were also slightly below
our Outlook. The figure is expected to be up 12% in FY2022.
Next, Basic Chemicals. Sales increased by 22% in the second half of FY2021, exceeding the Outlook also.
Melamine production will be halted in June of FY2022, resulting in a forecast 2% decrease in sales for FY2022.

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Next, page 27. Here, I would like to talk about operating profit in the Chemicals segment of FY2021 comparedto the previous year.
During the year, operating profit increased by JPY2.3 billion. Despite high raw material and fuel prices, as well
as soaring transportation costs, both sales and operating profit increased in Fine Chemicals and Basic
Chemicals due to higher sales volume and prices.

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Next, please see page 29. This is the Outlook for Chemicals segment for FY2022.
For Fine Chemicals, operating profits are expected to remain flat. However, we forecast a significant decreasein profits in the segment overall. This is due to a decrease in marginal profit from the withdrawal of melaminefrom the Basic Chemicals business, an increase in fixed costs, and the absence of the inventory adjustment
effects seen in FY2021.

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Next, please see page 34. This is the Performance Materials segment.
Sales of Display Materials increased 9% in the second half of the year, exceeding the Outlook. We forecast a
4% increase in FY2022.
Sales of Semis Materials increased 23% in the second half of FY2021, in line with the Outlook. We expect thistrend to continue, forecasting a 20% increase in FY2022.
Sales of Inorganic Materials increased by 5% in the second half of the fiscal year, exceeding the Outlook. We
forecast a 4% increase in FY2022.

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Next, page 36. This is a YoY breakdown of changes to operating profit in the segment in FY2021.
Operating profit increased JPY5.3 billion for the year, with significant gains in Display Materials and Semis
Materials and a small decline in Inorganic Materials.

10Next, page 38. This is the Outlook for FY2022.
We expect a slight decrease in operating profit for Display Materials, due in part to low price. We forecast alarge increase in operating profit for Semis Materials and Inorganic Materials.

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We will now move on to the Agrochemicals segment. See page 40.
This slide shows sales figures by item. For the second half of FY2021, sales increased by 7%, with a full-yearincrease of 3%. So, the result was a little below the Outlook.
For FY2022, we forecast an 11% increase in the segment. This includes the impact of the Fluralaner shipment
delays to FY2022 from FY2021, which I mentioned earlier.

12Please continue to page 41. This slide shows FY2021 operating profit from Agrochemicals.
For the year, sales increased by JPY2.0 billion, but operating profit increased only modestly, with an increaseof JPY0.1 billion. An increase in the purchase price of intermediates, as well as an increase in fixed costs, all
had a downward effect on operating profit.

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Next, a comparison with the Outlook. For Q4, shipment of Fluralaner API is partly delayed to FY2022, resulting
in a JPY1.0 billion downward revision.

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Next, on page 43, is the Agrochemicals FY2022 Outlook.
We forecast an increase in sales of JPY7.1 billion and an increase in operating profit of JPY1.2 billion. This
includes an increase in fixed costs of JPY1.8 billion. Of this amount, JPY0.4 billion is for the cost of NBR in India,
which will become a consolidated subsidiary this fiscal year.

15See page 44. The following is a list of major products, some of which have moved in the pipeline. First, NC241, a fungicide, was removed from the pipeline due to the high cost of raw materials and manufacturing.
On the other hand, as you can see on the second line from the bottom, we have included NC-520, an
insecticide, in our new pipeline and expect peak sales of JPY2.5 billion.

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Next, page 46. This slide concerns Fluralaner.
As shown in the green bar graph on the right, we have determined that the inventory adjustment wascompleted in FY2021. In FY2022, we expect a significant increase in sales due to the completion of inventory
adjustments, as well as from the delay of shipment from the previous fiscal year.
The assumed exchange rate is JPY115 to the USD for FY2022. For FY2023 and beyond, we are assuming an
exchange rate of JPY110.
In the final year of the new mid-term plan, FY2027, patent extensions and expirations in individual countries
are incorporated. However, the forecast does not factor in the increase in sales associated with the launch of
newly developed BRAVECTO series and EXZOLT.

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See page 48. This is NBR, a joint venture company in India. As you can see in the third line, the constructionof the plant is proceeding almost as planned despite the effects of the coronavirus pandemic. For this fiscal
year, there will be no shipments from NBR to customers, so there are only outgoings.

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Next, please see page 52. This is the Healthcare segment.
In Healthcare, we have identified 7 nucleic acid target themes. We have reduced our focus on small molecules,
with a reduction from 10 to 3 themes.
In addition, we will be working on biointerface control materials and cosmetic materials.
Resource allocation is described in the lower left corner. In terms of the number of researchers in FY2021, 75
were in Healthcare and 35 in the Planning and Development Division, giving a total of 110. This is almost thesame number as during the mid-term plan period.
R&D expenses will be kept at around the JPY2.4 billion level. This is the combined figure for Healthcare andDrug Discovery research that has been transferred to the Planning and Development Division. The table on
the right shows a quantitative plan.

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Next, page 53. This is the trend in operating profit in the last fiscal year for Healthcare.
Operating profit increased by JPY0.59 billion. Although sales and operating profit from Drug Discovery
declined, this was counteracted by strong performance of Custom Chemicals, positive impact of inventory
valuation gain and inventory adjustment. As a result, profit increased.

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See page 55. This is the Outlook for FY2022.
We forecast a fall in sales of JPY0.69 billion, and an increase in operating profit of JPY1.14 billion. As I
mentioned, JPY1.45 billion in R&D expenses will be transferred to the Planning and Development Division, so
if this is taken into account, the actual amount will be negative JPY0.3 billion.

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Next are the figures for the mid-term plan. See page 57.
These are the results for FY2021. As shown in the management indicators below, we have achieved our targets
for all indicators.

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Next, see page 60. This is the new mid-term plan.
Mr. Yagi will present this in detail later, but just to mention a few figures, operating profit is expected to be
JPY58.5 billion in FY2024 and JPY67.0 billion in FY2027. Our management targets are to maintain OP marginof at least 20% and ROE of at least 18%.
We continue to emphasize proactive shareholder returns and plan to raise our dividend payout ratio target
from 45% to 55%. With a total return ratio of 75%, we believe we can achieve an ROE of 18%.
From page 62 you can see ESG-related information, and page 71 onward lists various reference data.
This concludes my presentation of the financial results. Thank you very much.
We will now move on to a presentation on the new management plan.

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Yagi: I am Yagi, the Company President. Thank you very much for attending today's financial results andbusiness plan presentation. I will now present the long-term business plan Atelier2050 and the mid-termbusiness plan Vista2027, which started in April this year.
First, a summary of Vista2021 Stage II. Sales for the second half of the three-year period (Stage II) were
JPY208.0 billion, JPY27.0 billion below our target in the mid-term plan. Operating profit was JPY51.0 billion,
JPY8.0 billion higher than our target in the mid-term plan.
Although net sales fell slightly short, including the negative JPY22.9 billion impact of the changes in accounting
policies, we achieved our profit target. In fact, we exceeded it, even though the plan was made prior to thecoronavirus pandemic. Furthermore, operating profit exceeded our target of JPY50.0 billion for FY2030, 9
years ahead of schedule.

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All of the management indices have also been achieved in accordance with the FY2021 plan.

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I would like to provide a per-segment breakdown of this JPY8.0 billion plus in operating profit.
In Chemicals, profit was JPY1.3 billion below target due to lower sales of melamine and environmental related
products, changes in business environment, as well as higher raw material and transportation costs.
Performance Materials grew due to the expansion of photo IPS applications.
High sales in the Semis Materials business resulting from growth in global demand and market share
expansion, as well as lower fixed costs, all contributed to operating profits JPY10.4 billion above the target in
the Performance Materials segment.
Operating profit in Agrochemicals was JPY2.8 billion below the target. Despite growth in DITHANE andQUINTEC, falling sales in Fluralaner, GRACIA, and other products resulted in profits below the target.
Sales of Pharmaceuticals were lower than the target due to a delay in contract production of generic APIs andpeptides. However, fixed costs were down, resulting in operating profit JPY0.2 billion above target.
Overall, the increase in operating profit from Performance Materials made a significant contribution.

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In terms of resource allocation, R&D expenses decreased following a careful review of plans. Capital
expenditures also decreased due to the revision of plans, as well as some delays in plans.
Researchers decreased slightly.
In page 8 to 11, we also have a chart that shows the sales growth rate from FY2018 to FY2021 for the major
products listed by segment in Stage II. Please review those later.

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Next, I will explain the status of implementation of various policies from the basic strategy.
The first is about increasing profitability of products that are the sources of growth.
In Chemicals, we decided to cease production of melamine, which has a nearly 60-year history. We arepromoting structural reforms to further shift to high value-added products.
In the area of Performance Materials, sales of Display Materials, especially photo IPS, are expanding due tothe expansion of applications.
We decided to build a new plant in Dangjin, Korea to increase production capacity of Semis Materials.
In Agrochemicals, the Company expanded its agrochemical product portfolio through the acquisition of
DITHANE and QUINTEC.
In order to respond to the increasing demand for APIs and to establish a stable supply system, we establisheda joint venture company in India in 2020, Nissan Bharat Rasayan Private Limited. The plant is currently underconstruction.

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The second strategy is to strengthen ability to create new products.
The Planning and Development Division was established to accelerate the development of new materials. We
have established a Life Science Materials Development Department and an Innovative Materials Planning
Department to discover new compounds and develop markets in the three areas of information andcommunications, life sciences, and environment and energy.
As part of this effort, we have invested in venture capital and are considering the introduction of venturetechnology products. In Pharmaceuticals, we are steadily promoting the implementation of joint drug
discovery with pharmaceutical companies and securing research themes through a strategic alliance with
Luxana Biotech.

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This was the third strategy. It is about improving ability to adapt to social and market changes.
Society as a whole is shifting toward a greater emphasis on sustainability, and the demands placed oncompanies continue to change. The Group has also implemented many ESG-related measures and establishedthe relevant structures and systems.

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As described above, our business performance has been favorable, and we have gleaned the results of thevarious measures we have taken. On the other hand, looking to the future, we must say that we are lagging
behind in the creation and market penetration of new products. This slide shows the FY2021 plan for major
new products announced in May 2019.
A total of JPY19.6 billion in new product sales was planned.

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In contrast, the actual amount for FY2021 was JPY14.2 billion. Many of the new products have sales of lessthan JPY0.3 billion and are still in the development stage.

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Further expansion of these new products is a major challenge to ensure steady growth in the future.
The reason for the underachievement of new product sales is changes in the business environment, including
customers, technology, and markets, were not adequately reflected in our plans in a timely and accurate
manner. Therefore, to improve the success rate of development, we will work on improving our marketing
capabilities and developing new business area in order to promptly reflect the latest information on customers,
technologies, and markets in our plans. We will also work to strengthen the creation and co-creation processof value by improving operational efficiency. In the adjustments in practices during the post-corona period,
we are working to promote core operations by reducing non-core operations.
We have formulated a new management plan to resolve these issues and make further progress.

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Next, I would like to discuss our long-term business plan, Atelier2050. The social structure and businessenvironment are undergoing rapid changes, including accelerated efforts to realize a carbon-neutral society
triggered by climate change issues.
Based on this business environment, social issues, and management challenges, we have returned to our
corporate philosophy and formulated a new growth strategy. The corporate philosophy has been redefined
to clarify the direction and raison d'être of our Group. We aim to contribute to the protection of the global
environment and the existence and development of humanity, offering the value sought by society.

34Based on this, we have established the ideal state of our Group. We will pursue our corporate philosophy bypromoting our long-term business plan. Since we will focus on sustainable management as well as CSR, wehave renamed the underlying Basic CSR Policy to Course of Action. We will continue to use it as a guideline
for making decisions on our actions.

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We have set our vision for 2050, as a Corporate State, a “Future-Creating Company” that grows throughseeking to enrich people and nature, , and as an Organizational State, “a group of co-creators that facechallenges for change with a strong passion”. We also reflect here business areas, social involvement, andemployees state.
With regard to our relationship with society, in addition to expanding products and services that contributeto solving social issues, we have become a company that is trusted and valued by society as a whole, including
local communities. We will build on this through management that is rooted in reducing our impact on the
global environment. We have also established the basic stance of our group employees, who are the driving
force behind the creation of the future by realizing the ideal state of our company.

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Next, about business areas. We have defined Information & Communication, Life Science, and Environment& Energy as our growth business domains. Materials & Services is defined as a core business domain. By
acquiring new technologies in microbial control and information science in addition to the existing coretechnologies, the Company has entered new areas related to the three growth businesses. By evolving andintegrating our core technologies, we will accelerate growth in each of our business areas and contribute tosolving social issues.

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Next, I will discuss the basic strategies. Three basic strategies will be established to realize the ideal state.
In “Deeply exploit and expand business areas”, we will focus on acquiring and developing new technologies
to expand the scope of growth business domains.
In “Pursue sustainable management further”, we are pursuing and expanding the Nissan Chemical Sustainable
Agenda. We aim to achieve carbon neutrality. I will cover these points in more detail later. In “cultivate a
corporate culture where the future is co-related”, we will work to develop human resources that will continue
to create future-focused businesses, and to build and operate a system infrastructure.
In “Renovate management and business foundations”, the use of digital technology will be used to shift tocreative operations and speed up the value creation process.

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Next, I would like to talk about the Nissan Chemical Sustainable Agenda.
Nissan Chemical has identified products and services that contribute to solving social issues and set KPIs for
the Nissan Chemical Sustainability Agenda to maintain the ratio of sales of target products and services at
55% or more of consolidated net sales. We will expand sales of the relevant products toward the area ofcontribution starting from what we can do for the future of the earth and people. We aim to achieve carbon
neutrality by 2050.

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We will focus on achieving this goal by switching to raw fuel, promoting energy conservation, introducing
renewable energy, and introducing carbon-negative technologies.

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Next, I would like to discuss our mid-term plan, Vista2027.
Vista2027 is a six-year plan starting in FY2022, with the first three years as Stage I and the second three years
as Stage II. We will show our ideal image in 2027 as a milestone on the way to the corporate vision set forthin our long-term plan, Atelier2050. We will set a roadmap for sustainable growth.
The ideal state of the Company is as follows: while existing businesses are robustly driving the businessperformance, new core technologies are consistently acquired for expanding and enhancing business areas.
Organized sustainability-related initiatives are promote and related information is offered internally andexternally. As the digital foundation is being established, business activities are conducted based on the latest
information on clients and markets.

41Based on the challenges identified in the previous mid-term business plan and the vision for 2027, we haveset four basic strategies: deeply exploit business areas and increase marketing ability. Promote sustainable
management. Strengthen the creation and co-creation process of values. Expand market shares and profits
of existing businesses, that is, expansion of existing products as the source of growth and solid developmentof new products.

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As for numerical targets, we aim to achieve net sales of JPY255.0 billion and operating profit of JPY58.5 billion
in FY2024, the final year of Stage I. For FY2027, the final year of Stage II, we forecast net sales of JPY285.0
billion and operating profit of JPY67.0 billion. Comparing FY2027 with FY2021, we plan to achieve an increasein net sales of JPY77.0 billion and an increase in operating profit of JPY16.0 billion.
The exchange rate assumption is JPY110 to the USD for both FY2024 and FY2027. Compared to the current
rate, we consider this to be a reasonable assumption.

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For key management indicators, non-financial indicators are listed in addition to financial indicators.
First, with regard to financial indicators, the target OP Margin is at least 20% and ROE is at least 18%.
We will continue to emphasize shareholder returns. As a more direct measure to return profits toshareholders, we will raise the target dividend payout ratio from 45% to 55%. We plan to maintain a total
return ratio of 75%.
As for non-financial indicators, in the Nissan Chemical Sustainable Agenda, total sales of products and services
that contribute to solving social issues will be maintained at least 55%. The GHG emissions target for FY2027
will be reduced at least 30% compared to FY2018 level. This was originally our target for FY2030, and we havebrought it forward by three years. As indicators of human resource development, we plan to increase thepositive response rate in survey of employee attitude on human resource development at least 65%. Fromthe perspective of promoting diversity, we plan to increase the proportion of female researchers at least 18%.

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Next, cash flow.
The following chart shows the three-year cumulative results for the period from FY2019 to FY2021 and thethree-year cumulative plan for the period FY2022 to FY2024. We will continue to invest proactively ininvestments and shareholder returns.
We plan to return JPY90.0 billion to shareholders over the FY2022 to FY2024 period, an increase of JPY16.5
billion over the preceding three-year cumulative total.

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In terms of resource allocation, we plan to continue to aggressively invest in R&D and Capex to gain acompetitive advantage. We are aiming for a total of about JPY110.0 billion planned for FY2022 to FY2024, up
from the previous three-year total.

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Next, I will discuss sales and operating profit by segment.
Our target operating profit in FY2027 is JPY16.0 billion higher than the FY2021 level. Chemicals are plus JPY0.1
billion. Performance Materials are plus JPY10.3 billion. Agrochemicals are plus JPY2.7 billion. Healthcare isplus JPY3.4 billion. However, the target for healthcare includes the impact of the organizational change weintroduced earlier. Excluding this, the plan is for healthcare to be plus JPY1.6 billion.

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This is the first of the basic strategies. Next, deeply exploit business areas and increase marketing ability.
Aiming to expand our business domain by 2050, we will refine our existing core technologies, deeply exploit
and expand development areas, and incubate new core technologies. For example, we will master microbial
control technology, which we have positioned as a new core technology, with the aim of expanding ourbusiness domain by 2050.
This will allow us to expand our business into a wide range of areas by 2050, including the use of microbiomes
in agriculture and medicine, and the reduction of GHG emissions. To this end, we will introduce external
technologies, strengthen our marketing power and planning ability, and incorporate internal and external
technologies and information, aiming for early realization of actual demand.

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The second basic strategy is to promote sustainable management.
First, to strengthen corporate governance, we will address ESG indicators as well as profit indicators in thecompensation system for officers. Specifically, ESG assessment by a third-party organization and GHG
emission reduction rate will be added to the evaluation indicators.
We will strive to strengthen the effectiveness of our management plan by achieving both performance andsustainability goals.

49In addition, a new Climate Change Action Committee will be established to accurately identify the risks andopportunities posed by the increasingly serious climate change issue and promptly reflect them in our
strategies.

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Strengthened internal coordination of risk measures to anticipate various risks and reduce risk impact withregard to risk management and compliance enhancement. We will improve the effectiveness of planning,
implementation, and management, and build a robust internal control system.

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We will contribute to solving social issues and strengthen our efforts to address three material issues andmateriality in order to realize our ideal vision.

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In Materiality 1, Provision of new value for helping to enrich people's lives, we aim to provide products andservices that contribute to solving social issues are identified by element. We have established FY2027 goals
for each.
The sum of each factor is used as the KPI for the Nissan Chemical Sustainable Agenda.

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Materiality 2 is strengthening of the Company's business base. We will strengthen our business foundation byenhancing our human capital, increasing our ability to respond to increasingly diverse and sophisticatedmarket demands.

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In Materiality 3, continuous improvement of responsible care activities, we will continue our Responsible Careefforts with a focus on reducing GHG emissions in order to achieve carbon neutrality by 2050.

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In terms of GHG emissions reduction, we plan to reduce GHG emissions by at least 30% from the FY2018 level
by FY2027. We will do this by promoting measures such as improvement of production technology, in addition
to existing initiatives.

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Basic Strategy 3. In terms of strengthening the creation and co-creation process of values, the Company has
revamped the existing personnel system and human resources development for attaining business strategies
and established Digital Transformation Department in order to realize its management strategy. We will work
to create an infrastructure environment that enables us to focus on creative work by reflecting diverse
opinions, including the promotion of DX business infrastructure reforms.

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Next is Basic Strategy 4. This is the expansion of market shares and profits of existing business.

58This slide shows the breakdown of sales growth from FY2021 to FY2024 and FY2027, broken down into current
products and new products. In FY2024, we plan to increase the sales of new products by JPY8.5 billion andexisting products by JPY38.5 billion, for an increase of JPY47.0 billion over sales in FY2021.
In FY2027, we plan to expand by JPY77.0 billion from FY2021 levels. The breakdown is plus JPY26.0 billion for
new products and plus JPY51.0 billion for existing products.

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We have positioned existing and new products with sales of JPY0.5 billion in FY2027 compared to FY2021 asa source of growth and will focus on expanding these products.

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The following table shows current products we anticipate may be growth drivers by segment and by product.
We plan to increase sales mainly of Performance Materials and Agrochemicals products.

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As for major new products, we plan to increase sales of photo VA, OLED materials, and EUV materials in the
Performance Materials business, in-house developed products in the Agrochemicals business, and genericdrugs in the Healthcare business. We will focus on RDL materials, optical interconnect materials, and othermajor products in the Planning and Development Division.

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Next, I will discuss measures by segment.
In the Chemicals segment, we see rising raw material and fuel prices, growth in the semiconductor market,
and increasing demand for environmentally friendly products as both opportunities and risks. We will work
to rebuild the ammonia related business after the suspension of melamine production, expand sales of highpurity sulfuric acid, and increase sales and profitability of cyanuric acid.
By executing the necessary investments to promote the measures, we plan to increase revenues for FY2027
even after the suspension of melamine production.

63

Sales growth rates of major products are as shown.

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Next, in terms of Performance Materials, the OLED market is expanding and the LCD market is shrinking. With
the outlook that semiconductor miniaturization will slow down and 3D packaging technology will advance, we
aim to increase sales by JPY35.5 billion in FY2027 compared to FY2021. We will do this by improving existingproducts, expanding applications, developing and launching new products, and enhancing and upgrading
facilities.

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This slide shows net sales and operating profit by sub-segment during the medium-term management plan
period. We plan to record stable earnings in the Display Materials business and grow in the Semis Materials
business.

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The following table shows sales growth rates by major products.
We plan to add 85% to the total Semis Materials sales by FY2027. Please review this later.

67

In Agrochemicals, seizing opportunities presented by labor shortages due to a declining domestic population,
the need to increase food production due to a growing global population, and the growth of environmentallyfriendly and bio-based agrochemicals and materials against the backdrop of the EU's Farm to Fork strategy
and other national policies, we have established a biotechnology research team to steadily develop new
products and create a pipeline. By investing in production facilities, we plan to increase sales by JPY16.5 billion
in FY2027 compared to FY2021.
See sales growth rates by major product later in this report.

68Inventory adjustment for Fluralaner was completed in FY2021. We anticipate increasing revenues fromFY2022 onward.

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Next is the Healthcare segment. Organizational changes were implemented as of April 1, 2022. We haveintegrated the research functions of the Pharmaceutical Business Unit and the Planning and Development
Division and concentrated resources to achieve mid- to long-term growth.

70

In the Healthcare segment, we are targeting net sales of JPY11.48 billion for FY2027, an increase of JPY4.9
billion from FY2021. We aim to do this by increasing the number of generic drugs, expanding efforts in thedevelopment of middle molecular drugs, making focused investments in the oligonucleotide therapeutics area
in light of the aging society and diversification of medical care, increasing actual demand and sales of medical
materials, and promoting joint development.
As mentioned in the organizational revision, we will focus on accelerating the selection and concentration ofbusiness areas to realize the plan.

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Finally, we recognize that in recent years the Group has earned a certain reputation in the market for its stableperformance and proactive shareholder returns.
We will focus on developing new products and new businesses to realize our vision. We hope to continue todevelop with society. The Group as a whole will take on the challenge of creating new value that willcontribute to solving social issues.
With this in mind, the slogan of our management plan is "To be an enterprise that faces challenges toward
the future through co-creation." To realize the vision of our group, we will continue to mobilize knowledge
and wisdom from both inside and outside the Company, and take on challenges with passion. We will continue
to make concerted efforts to meet the expectations of our stakeholders through the collective efforts of theGroup. Thank you for your continued support.
This concludes my presentation.

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Question & Answer<Questioner 1>
Q: Regarding the outlook for this fiscal year. In Agrochemicals, the figure is JPY7.1 billion in sales this year,with JPY1.2 billion in operating profit, and about JPY1.8 billion in fixed cost increases. Even with thatbreakdown, I think the profit growth is a little low relative to the sales growth. Profitability will probably
increase, especially as Fluralaner comes out. What else, for example, would make the mix worse or cause
concern? Please tell us about the growth in profits relative to the growth in sales this time around.
A: One factor is inventory adjustment costs. That is minus JPY0.6 billion, a very large movement whencompared to the previous fiscal year. In addition, there are places where the prices of raw materials andintermediates are rising.
Q: Will logistics costs, for example, go up considerably? Please let me also confirm whether this will be a factor
in increasing costs, especially with regard to exports.
A: The cost of shipping containers has increased. This cost has been increasing more than our expectation, we
believe it will be a factor that will put pressure on profits during the current fiscal year.
Q: Understood. One more question on Agrochemicals. Regarding page 48 of the financial results presentation,
the joint venture in India. The contribution to operating profit, which is projected to grow at a very high rate.
Please let us know its background.
A: The steady growth of items such as GRACIA, LEIMAY and QUINTEC to be manufactured is reason for theincrease in operating profit. With regard to GRACIA, the company plans to significantly expand sales in India,
other Asian countries, and the Middle East, in addition to South Korea. As for LEIMAY, we have plans todevelop a mixture compound with a multinational company in Europe. This could represent a significant
upswing. QUINTEC is acquired product. To support this, we plan to use NBR for full production.
Q: I have a question about the mid-term plan on page 34. There is mention of strengthening marketing ability.
Are you able to give us any more specific details?
A: First of all, to select the theme, whether it is a must-have material or not? One thing we have to pursue isthe materials that customers cannot function without.
As for human resources, we need to develop employees who can judge for this. In the past, we havedeveloped a variety of themes, but we have ended up with several dropped trends. I believe that we mustreflect on that and make early decisions to decide whether take action and move on to the next step.
Q: You didn't mention much about M&A this time.
A: To proceed with M&A is our fundamental strategy. That remains unchanged.

<Questioner 2>
Q: Regarding page 49 of the mid-term plan. Photo VA and OLED materials are listed as future growth drivers.
For the examples listed here, what level of resources are you putting into development? What are yourthoughts on this?

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A: It does not mean that we will specialize in what is written here and concentrate on these areas. We will
choose our themes carefully and want to concentrate on them.

<Questioner 3>
Q: Regarding Display Materials. You commented that you forecast reduced profits in the new fiscal year andthat you are firm on prices. Can you tell us a little more about the background behind this?
Also, the growth rate of photo IPS seems to be slowing down. I believe that there were installations of photocompatible equipment at panel makers at the end of last year. I feel like we can expect a lot in that area.
If you have factored in the impact of the Chinese lockdown, I would appreciate your explanation of that aswell. Thank you for your cooperation.
A: As for the unit price, first of all, as a premise, we expect a steady expansion on a volume basis, while panel
demand will continue to be strong.
Under this premise, the unit price of LCD panels has been on an upward trend amid strong demand for the
past several years but has now begun to decline. The forecast of the corresponding decline in the unit priceof materials has led to decline in some areas.
As for photo IPS, the trend is the same. We expect the volume to expand due to the increase in customers, as
you indicated, but the rate of increase will slow down slightly with some decline in the unit price expected. In
addition, there is no impact from the lockdown at this time. The impact of the lockdown has not been factored
in the Outlook.

<Questioner 4>
Q: I'd like to ask about pages 15 and 16 of mid-term plan materials. Why have there been delays indevelopment of major new products in FY2021? An unexpected increase in demand has come in Performance
Materials, especially Semis Materials, then, has there been a delay in the development of new products
because resources had to be allocated to that side?
A: There is no indication that we did not have the resources to develop it on time. Delay of starting up of
targeted devices for 3D packaging process materials and CMOS image sensor materials is main reason for thedelay.
Q: Are you saying that you were thinking that materials would go in a certain direction, but they actually went
in a different direction? Or did your competitor develop it first and your company was a little late to the game?
A: The major reason is the former. There are some areas where the competitor took the customer first.
Q: For example, I think EUV materials, CMOS image sensors materials, and 3D packaging process materials
will continue to gain momentum. What kind of strategy do you think you are going to make these a big sales?
A: First of all, the materials used for 3D packaging process are used in wafer thinning processes. We aretargeting this area where we are expanding our market share. Regarding CMOS image sensor, we are currently
in the process of working on where to target again from the marketing.

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Q: How about EUV? Is everything going well here?
A: The EUV is being applied by our customers in a favorable manner. We will proceed with our strategy tomaintain and expand our market share with high performance and high quality.
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