Itochu : Presentation Material with Script

1

2

Consolidated net profit for the first‐half amounted to a robust ¥483.0 billion, nearly a record high and surpassed only by the all‐time best of ¥500.6 billion recorded in the same period of the previous fiscal year.

Our progress against the FYE 2023 initial forecast of ¥700.0 billion now stands at 69%, while progress against the FYE 2023 revised forecast of ¥800.0 billion, announced on October 4, 2022, stands at 60%. Looking at quarterly operating results, consolidated net profit for the first and second quarters stood at ¥230.6 billion and ¥252.4 billion, respectively, suggesting steady growth in our earnings power and ongoing momentum in performance.

In terms of year‐on‐year comparisons, although the absence of large extraordinary gains recorded in the same period of the previous fiscal year led to a year‐on‐year decline in consolidated net profit, core profit-an indicator of earnings power excluding one‐off effects-came to ¥430.0 billion and thus marked a record high. This also represents progress of 61% against the initial FYE 2023 forecast of around ¥710.0 billion. Moreover, the above results represent progress of 56% against the FYE 2023 revised forecast for core profit of ¥770.0 billion, a record high. In sum, our operating results demonstrate steady growth in ITOCHU's earnings power.

3

As for the first‐half operating results and progress by segment, the Machinery Company and the Energy & Chemicals Company posted record‐high consolidated net profit for the first half, while the Metals & Minerals Company and the General Products & Realty Company enjoyed robust results. Meanwhile, operating results for the Textile Company, the Food Company and The 8th Company were on par with the FYE 2023 initial forecast. On the other hand, progress against the FYE 2023 initial forecast was stagnant in the ICT & Financial Business Company. Here, I will explain the first half performance of these companies based on the order of their progress vis‐à‐vis the FYE 2023 initial forecast.

The Machinery Company: In addition to the robust results of all businesses under its supervision, including ship‐related companies and automobile‐related business, the Machinery Company has benefitted from such positive factors as extraordinary gains arising from the divestment of the North American maintenance‐related business, thereby achieving progress of 98% against the FYE 2023 initial forecast and hitting a record‐high consolidated net profit of ¥71.4 billion for the first half . The General Products & Realty Company: While pulp prices remain higher than estimated, the performance of the North American construction materials business, in which we practice hands‐on management, has been robust. Furthermore, a revaluation gain was recorded in connection with the reorganization of the North American engineered wood products company. Reflecting these and other factors, the General Products & Realty Company achieved progress of 87% against the FYE 2023 initial forecast, with consolidated net profit for the first half amounting to ¥63.0 billion.

4

The 8th Company: Daily sales at the stores of FamilyMart increased, reflecting the success of new product development, high‐volume package campaigns and other measures that attracted immense customer attention. In addition, the thorough practice of the "cut" principle, which involved the data‐ driven optimization of delivery routes and inventory, resulted in cost reductions. These endeavors enabled The 8th Company to achieve consolidated net profit for the first half of ¥19.5 billion, which represents on‐par progress of 81% against the FYE 2023 initial forecast. The 8th Company's progress tends to be particularly high during the first half, as the highest revenue season of the convenience store business is centered around summer.

The Metals & Minerals Company: Iron ore market prices, albeit on a downturn, remained higher in the first half than initially assumed for FYE 2023, while coal prices were consistently strong. These factors, in turn, enabled IMEA to perform robustly. The performance of the steel business similarly remained solid in North America. As a result, the Metals & Minerals Company saw progress of 68% against the FYE 2023 initial forecast, achieving consolidated net profit for the first half of ¥134.7 billion.

The Energy & Chemicals Company: On the back of surging market prices, the overall performance of energy, chemicals and power businesses has been strong. Consequently, the Energy & Chemicals Company's consolidated net profit for the first half stood at ¥48.5 billion, an all‐time high. Its progress against the FYE 2023 initial forecast amounted to 56%, which is pretty high for a company that tends to perform more strongly in the second half.

The Textile Company: DESCENTE has established a well‐balanced revenue structure supported by revenue sources in Japan, South Korea and China. Meanwhile, the apparel‐related business, including LEILIAN and EDWIN, has benefitted from recovery in demand due to the relaxation of movement restrictions. As a result, the Textile Company saw consolidated net profit for the first half of ¥11.6 billion, which is on par with the FYE 2023 initial forecast, representing an annual progress rate of 45%. The Food Company: Surges in raw material prices and distribution costs, along with the depreciation of the yen, caused the profitability of fresh‐food‐related companies in Japan and overseas to deteriorate. However, despite these and other negative factors, the Food Company recorded consolidated net profit for the first half of ¥27.7 billion and achieved an annual progress rate of 40%, almost on par with the FYE 2023 initial forecast, backed by the ongoing robustness of the North American grain‐related companies and food distribution businesses in Japan.

The ICT & Financial Business Company: Information technology, BPO and other related businesses performed strongly. On the other hand, stagnant stock market conditions resulted in deterioration in remeasurement gains (losses) for fund held investments, which were robust in the previous year, while the mobile‐phone‐related business saw a decline in profit. In addition, many of the businesses supervised by this company maintain a revenue structure dependent on revenues in the second half. Reflecting these and other factors, the ICT & Financial Business Company's consolidated net profit for the first half totaled ¥25.4 billion, with its annual progress rate at 30%.

Others, Adjustments & Eliminations: CITIC achieved a robust rate of progress against the FYE 2023 initial forecast thanks in part to the depreciation of the yen and extraordinary gains on revaluation of the securities business.

5