Message from the CFO

FY2025 was a challenging year from a profitability perspective, as we faced structural changes in the business environment, including persistently high raw material prices and shifts in supply-demand dynamics. We take these results seriously and recognize the need to accelerate the transformation aimed at improvingof our business and earnings model to enhance earnings structure and enhancing corporate value.

Against this backdrop, we have steadily advanced structural reforms in existing businesses, improved productivity, and enhanced capital efficiency. At the same time, we have expanded solution-based proposals centered on our proprietaryunique strength, “Oishisa Design,”^​ approach, while strengthening the foundation of our overseas business operations. We have also made steady progress in building the foundation for medium- to long-term growth and enhancement of corporate value through initiatives such as reducing cross-shareholdings and investing in dX^* and human capital. We believe that by translating these initiatives into tangible results in FY2026, they will serve as an important foundation for our next medium-term business plan.

At the same time, our price-to-book ratio (PBR) remains below 1.0, and our return on equity (ROE) has yet to consistently exceed our cost of equity. We recognize this as a significant management issue. In addition to the volatility inherent in our earnings structure, we believe that one underlying factor is our inability to fully communicate our growth potential and long-term value creation story to capital markets.

Based on this understanding, FY2026 will be a year focused on restoring our core earnings power and delivering results. Through disciplined pricing strategies, expansion of sales of high-value-added products, and cost structure reforms, we will work to improve and stabilize profitability. At the same time, we will continue pursuing new value creation initiatives that will contribute to our growth strategy beyond FY2027, thereby building a foundation for medium- to long-term growth.

In our financial strategy, we will continue to emphasize a balanced approach to growth investment, shareholder returns, and financial soundness, while promoting management with a strong awareness of capital efficiency. Regarding shareholder returns, we have introduced dividend on equity (DOE) as a new return indicatorperformance metric and will pursue stable and disciplined shareholder returns with a medium-term target of approximately 3%.

We will also place even greater emphasis on dialogue with our stakeholders. By clearly communicating our progress in transforming our business portfolio and improving our earnings structure from both financial and non-financial perspectives, we aim to share a clear path toward enhancing corporate value.

As CFO, I am committed to steadily improving profitability and capital efficiency while pursuing the sustainable enhancement of both corporate value and shareholder value. I sincerely ask for your continued understanding and support.