Taikisha : Updated "Financial Results Briefings"

This photo shows Kumbhalgarh Fort, one of the Hill Forts of

Rajasthan, the world heritage in India, where Taikisha has affiliates.

The First Half of FY2020

Financial Results Briefing

Nov 17,2020

Copyright 2020 Taikisha Ltd., All Rights Reserved.

Today's explanation contents

1. Greeting

･Explanation about the settlement of accounts

2.･Initiatives of each strategy in mid- term business plan (FY2019-FY2021)

3. Questions and answers

Representative Director, President Corporate Officer

Koji Kato

Director, Managing Corporate Officer / Chief

Executive, Administrative Management

Headquarters

Masanori Nakagawa

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1. Business environment and Achievements for the First Half of FY2020
2. Earnings Forecast for FY2020

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1. Business environment and Achievements

for the First Half of FY2020

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1Business environment and Achievements for the First Half of FY2020

Business environment of H1

In Japan

In the field of Building HVAC, there was a movement to postpone investment due to the impact of the state of emergency during the first quarter of FY2020.

Also, regarding the field of Industrial HVAC, due to the effects of the economic downturn caused by the spread of COVID-19 infection and the growing uncertainty about the future, capital investment by manufacturers continued to be cautious.

Overseas

Capital investment by each manufacturer continued to adjust in both the fields of Industrial HVAC and the automobile paint finishing system.

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1Business environment and Achievements for the First Half of FY2020

Consolidated performance of H1

（Hundred millions of yen）

	Original		Results of		Change
	expectation		H1 FY2020
Orders-received	900	945	45
Net sales of completed	805	815	10
construction contracts
Ordinary income	39	37	-1
(Ratio)	4.8%	4.6%	-0.3%
Profit attributable to	29		30		1
owners of parent
(Ratio)	3.6%	3.8%	0.2%

Due to the impact of the spread of COVID-19 infection, the earnings forecast was disclosed at the timing of the announcement of the first quarter financial results on August 11.

As a result, the achievements were almost as expected compared to the original expectation for the first half.

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2. Earnings Forecast for FY2020

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• Earnings Forecast for FY2020

Consolidated Earnings Forecast for FY2020

（Hundred millions of yen）

	Results		Expectations			Original
				expectation
	of H1		of H2			of FY2020
Orders-received	945	1,074	2,020
Net sales of completed	815	1,214	2,030
construction contracts
Ordinary income	37	82	120
(Ratio)	4.6%		6.8%		5.9%
Net income	30	49	80
(Ratio)	3.8%	4.1%	3.9%

【Outlook for the business environment】（Green Technology System Business）

Construction demand for the field of building HVAC has become more declining due to the spread of remote work, and there are movements to postpone or shrink investment plans in the short term. But demands for such as large-scale redevelopment, renewal, and data centers are expected to remain firm in the medium to long term.

In the field of Industrial HVAC , capital investment is expected to continue in the correction phase in the short term due to the economic downturn caused by the spread of COVID-19 infection both in Japan and overseas.

On the other hand, although there are concerns about the speed, we believe that demand will recover in the medium to long term due to the spread of 5G and the full-scale implementation of CASE, both in Japan and overseas.

（Paint Finishing System Business）

The outlook remains uncertain due to the re-expansion of COVID-19 infection, and capital investment is expected to continue in a correction phase.

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1. Explanation about the First Half of FY2020

• Highlight of the First Half of FY2020

• Results of Green Technology System Business

• Results of Paint Finishing System Business

• Main projects in Order/ Sales / Carried forward

• Earnings Forecast for FY2020

• Shareholders Returns

1. 2. Initiatives of each strategy in mid-term business plan (FY2019-2021)

2. The mention numerical value is in principle consolidated basis. In the case ofnon-consolidated basis, it is noted on the title of the page.
3. Achievements numerical value is in principle a business amount of money for the external customers. Only about operating income and ordinary income according to the segment, it becomes the numerical value including the intersegment turnover.
4. The forecasted figures are based on available information as of the date of this announcement. It includes economic trends, intense competition in the industry, market demand, exchange rate, reforms of the tax system and various systems, and various other risks and uncertainties. Therefore, please note that actual results may differ from our expectations.

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1. Explanation about the First Half of FY2020

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• Highlight of the First Half of FY2020

１-① .Orders-received by Business （Previous year comparison）Component

		（Hundred millions of yen）
	2019.9	2020.9		Change	2020.9	Building
Orders-received	1,184	945		-239
	results
(Japan)	(666)	(449)		(△216)	Paint	161
					(Overseas) (17.1%)
(Overseas)	(518)	(495)		(△22)
		300
Green Technology	786	594		-191
	(31.8%)
Building HVAC	235	161		-74	Industrial
Industrial HVAC	550	433		-117	Paint		(Japan)
					(Japan)		238
(Japan)	(360)	(238)		(△122)	Industrial
					49	(25.2%)
(Overseas)	(189)	(194)		(5)
	(5.2%)	(Overseas)
Paint Finishing	398	350		-48
		194
(Japan)	(69)	(49)		(△20)
		(20.6%)
(Overseas)	(328)	(300)		(△27)

（Green Technology System Business）

In the field of Building HVAC, there was reactionary decline due to orders for large-scale projects in the same period of FY2019 and postponement of investment in the short term due to the spread of COVID-19 infection.

In the field of industrial HVAC in Japan, there was reactionary decline due to orders for large-scale projects in the same period of FY2019, and capital investment continued to be adjusted due to the downturn caused by the spread of COVID-19 infection.

On the other hand, the field of industrial HVAC in overseas was also affected by the economic downturn, but due to orders for large-scale redevelopment projects in Thailand, etc., the orders-received increased.

（Paint Finishing System Business）

2019.9 results

Paint (Overseas) Building

328 235

(27.8%) (19.9%)Paint

(Japan)

69Industrial

(5.9%) (Japan)

As for Paint Finishing System Business, although we received orders for large-scale projects from non- Japanese customers in Europe FY2020, orders-received decreased, because capital investment continued to adjust due to the effects of the economic downturn, and we received abundant orders in North America in the same period of the previous year.

Industrial 360 (Overseas) (30.5%)

189

(16.0%)

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• Highlight of the First Half of FY2020

１-②.Orders-received by Business （Expected comparison）	Component
				（Hundred millions of yen）
			Original	Result of	Change	2020.9		Building
			expectation	H1 FY2020	results
				Paint		161
		Orders-received	900	945	45
				(Overseas)	(17.1%)
		(Japan)	(407)	(449)	(42)			300
		(Overseas)	(493)	(495)	(2)			(31.8%)		Industrial
		Green Technology	550	594	44		Paint
				(Japan)
		Building HVAC	104	161	57		(Japan)		238
						49	Industrial	(25.2%)
		Industrial HVAC	446	433	-12
							(5.2%)(Overseas)
		(Japan)	(249)	(238)	(△10)
				194
		(Overseas)	(197)	(194)	(△2)			(20.6%)
		Paint Finishing	350	350	0
		(Japan)	(54)	(49)	(△4)	Original
		(Overseas)	(296)	(300)	(4)	expectation

（Green Technology System Business）

In the field of Building HVAC, the orders-received exceeded original expectation, because the projects that were expected to be issued in the second half or later in view of the movement of customers to postpone the investment period due to the spread of the COVID-19 infection were received ahead of schedule in the first half.

The orders-received of industrial HVAC in Japan fell below original expectations because of the postponement of investment plans due to the economic downturn caused by the spread of the

COVID-19 infection.

（Paint Finishing System Business）

The orders-received of Paint Finishing System Business was almost as expected.

Building

Paint 104(Overseas) (11.6%)

296

(32.9%)Industrial (Japan)

Paint	249
(27.7%)
(Japan)

54Industrial

(6.0%)(Overseas)

197

(21.9%)

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• Highlight of the First Half of FY2020

２-① .Sales by Business（Previous year comparison）

Component

		（Hundred millions of yen）
Net sales of completed	2019.9	2020.9	Change
1,049	815	-233
construction contracts
(Japan)	(642)	(474)	(△168)
(Overseas)	(407)	(341)	(△65)
Green Technology	761	573	-188
Building HVAC	251	175	-75
Industrial HVAC	510	397	-112
(Japan)	(334)	(258)	(△75)
(Overseas)	(176)	(139)	(△36)
Paint Finishing	288	242	-45
(Japan)	(57)	(40)	(△16)
(Overseas)	(230)	(201)	(△29)

2020.9

results PaintBuilding

(Overseas) 175

201 (21.5%)Paint(24.7%)

(Japan)

40		Industrial
(5.0%)
Industrial	(Japan)
	258
	(Overseas)
	139	(31.7%)
	(17.1%)

（Green Technology System Business）

In the field of Building HVAC, the volume of large-scale redevelopment projects increased in the same period of FY2019, so the net sales decreased in reaction.

In the field of industrial HVAC in Japan, significant progress of several large-scale projects in the same period of FY2019, so the net sales decreased.

In the field of industrial HVAC in overseas, although the amount of carried forward was higher than at the beginning of the first half of FY2019, there were few projects that contributed to the completion of the first half accounting period of the current term, so the net sales decreased.

（Paint Finishing System Business）

As the amount of carried forward was less than at the beginning of FY2019, the total amount of net sales decreased.

In both businesses, construction activities were restricted overseas during the lockdown, but the impact was minor.

2019.9 results

Paint (Overseas) Building

230 251 Paint (22.0%)(23.9%)(Japan)

57

(5.5%)

Industrial Industrial (Overseas) (Japan)

176 334

(16.8%) (31.8%)

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• Highlight of the First Half of FY2020

２-②. Sales by Business （Expected comparison）

		（Hundred millions of yen）
	Original	Result of	Change
	expectation	H1 FY2020
Net sales of completed	805	815	10
construction contracts
(Japan)	(480)	(474)	(△5)
(Overseas)	(325)	(341)	(16)
Green Technology	565	573	8
Building HVAC	166	175	9
Industrial HVAC	399	397	-1
(Japan)	(264)	(258)	(△5)
(Overseas)	(135)	(139)	(4)
Paint Finishing	240	242	2
(Japan)	(50)	(40)	(△9)
(Overseas)	(190)	(201)	(11)

The net sales in both the Green Technology System Business and the Paint Finish System Business were almost as expected.

Component

2020.9

results PaintBuilding

(Overseas) 175

201(21.5%) Paint(24.7%)

(Japan)

40		Industrial
(5.0%)
Industrial	(Japan)
	258
	(Overseas)
	139	(31.7%)
	(17.1%)

Original expectation

Paint Building

(Overseas) 166

190 (20.6%)

Paint(23.6%)

(Japan)

50

(6.2%)Industrial Industrial (Japan) (Overseas) 264

135 (32.8%)

(16.8%)

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• Highlight of the First Half of FY2020

３-① .Profit by Business（Previous year comparison ）

	（Hundred millions of yen）
	2019.9	2020.9	Change
Operating income	75	31	-43
（Ratio）	7.2%	3.9%	-3.3%
Green Technology	72	42	-29
（Ratio）	9.5%	7.4%	-2.1%
Paint Finishing	5	-10	-16
（Ratio）	1.9%	-4.5%	-6.3%
Ordinary income	76	37	-39
（Ratio）	7.3%	4.6%	-2.8%
Green Technology	74	44	-30
（Ratio）	9.8%	7.8%	-2.0%
Paint Finishing	5	-10	-15
（Ratio）	1.8%	-4.4%	-6.2%

（Green Technology System Division）

The ordinary income decreased because of a significant decrease in the amount of the net sales of completed construction contracts.

（Paint Finishing System Division）

The amount of net sales in relatively profitable areas decreased due to the impact of the economic downturn, resulting in a current account deficit.

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• Highlight of the First Half of FY2020

３-②. Profit by Business （Expected comparison）

		（Hundred millions of yen）
	Original	Results of	Change
	expectation	H1 FY2020
Operating income
31	31	0
（Ratio）	3.9%	3.9%	0.1%
Green Technology	42	42	0
（Ratio）	7.4%	7.4%	△0.0％
Paint Finishing	-10	-10	△0
（Ratio）	-4.2%	-4.5%	-0.3%
Ordinary income	39	37	-1
（Ratio）	4.8%	4.6%	-0.3%
Green Technology	44	44	0
（Ratio）	7.8%	7.8%	△0.0％
Paint Finishing	-8	-10	-2
（Ratio）	-3.3%	-4.4%	-1.0%

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• Highlight of the First Half of FY2020

４. Consolidated Income Statements

（Hundred millions of yen）

（Hundred millions of yen）

	2018.9	2019.9	2020.9
Net sales of completed	988	1,049	815
construction contracts
Gross profit on completed	135	177	129
construction contracts
(Ratio)	13.7%	16.9%	15.9%
Selling, general and	101	102	97
administrative expenses
(Ratio)	10.3%	9.7%	12.0%
Operating income	33	75	31
（Ratio）	3.4%	7.2%	3.9%
Ordinary income	38	76	37
（Ratio）	3.9%	7.3%	4.5%
Profit attributable to	9	53	30
owners of parent
(Ratio)	0.9%	5.1%	3.8%

1,500

1,000

500

0

			20%
	16.9%	15.9%
988	1,049		15%
13.7%		815
			10%
	7.3%
3.9%	7.2%	4.5%	5%
3.4%		3.9%

0%

2018.9 2019.9 2020.9

Sales

Gross profit on completed construction contracts ratio （%）

Operating income ratio （%）Ordinary income ratio （%）

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• Highlight of the First Half of FY2020

５.Net sales of completed construction contracts / Ordinary income by Division

Green Technology System Business

9.4%	9.8%
	7.8%

（Hundred millions of yen）

Paint Finishing System Business

1.8%

900		74	80	600
	65	761
	691		60
600			573	300
			44
			40

-9.5%

297 288

-4.4%80

60

242 40

20

300	0
	20

0		0	(300)

2018.9 2019.9 2020.9

5

-10

-28

2018.9 2019.9 2020.9

ratio

0

‐20

‐40

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• Highlight of the First Half of FY2020

6. Orders-received / Net sales of completed construction contracts / Construction carried forward

（Hundred millions of yen）

2,000

Orders-received

2,000

Sales

2,000

Carried forward

1,7901,872 1,859

1,500

1,000

1,185			1,500
1,184
25221.3%	23519.9% 945	1,000
		16117.1%

9881,049

19019.3% 25123.9%815

1,500

1,000

58432.6%

40622.7%

512 27.4%442 23.8%

38420.5% 33518.0%

500

44337.4%	360	30.5%	23825.2%
	189	16.0%	20.6%	500

31331.7% 33431.8％

17521.5%

258 31.7％

500

23313.0%

81

4.3%

74

4.0%

188	15.9%	69	5.9%	194	5.2%
5.1%	49
60	328 27.8%300	31.8%
24020.3%

18718.9%	17616.8%	139	17.1%
46	4.7%	57	5.5%	40	5.0%
25025.3%	230 22.0%201	24.7%

50228.1%64234.3% 61132.9%

0

2018.9 2019.9 2020.9

0

2018.9 2019.9 2020.9

0

2018.9 2019.9 2020.9

Building HVAC	Paint Finishing (Japan)
Industrial HVAC (Japan)	Paint Finishing (Overseas)
Industrial HVAC (Overseas)

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• Highlight of the First Half of FY2020

７. Overseas net sales of completed construction contracts by Region

44.3%		41.8%
	38.8%

600

（Hundred millions of yen）

1,200

1,000

800

988

1,049

815

	437	7
400	38
	56

407 4

48	341	6
46	14

600

400

550 642

474

48

200 124

80

56	47
51

8666

6275

200

437 407 341

0

81

10278

0

2018.9 2019.9 2020.9

Japan

Overseas

―Overseas Ratio

2018.9	2019.9	2020.9
Other Southeast Asia	North America
Thailand	China
Others	India
Other East Asia

●Main countries and regions ※The numerical value does not include the internal trading. ・Other SoutheastAsia-- Singapore , Malaysia, Indonesia, Philippines, Vietnam , others

・Other EastAsia--Taiwan, Korea ・North America--USA, Canada, Mexico ･Others-- Russia, South America, others

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• Highlight of the First Half of FY2020

8. Sales of overseas main five companies

			（Hundred millions of yen）
Taikisha （Thailand）Co.,Ltd. Group	Wu-Zhou Taikisha Engineering Co., Ltd.
TKS Industrial Company Group
（Thailand）	Group（China）	（USA）

200
150	122
100	25	86
	66
		12
			12

200

150

100

39

45

200

150

100	75
54
58

50	97	73	54

0

50

0

	36
27	29	37
11	7	8

50

0

54 58 75

2018.9 2019.9 2020.9

Geico S.p.A. Group

(Italy）

200

150

100 77

50	73	42	46
	42	46
0		4
2018.9	2019.9	2020.9

200

150

100

50

0

2018.9

2019.9

2020.9

Taikisha Engineering India

Private Ltd.（India）

35		41
32		41		13
3	0
0
13
2018.9		2019.9		2020.9

2018.9 2019.9 2020.9

Paint Finishing System

Industrial HVAC

The numerical value does not include the internal trading.

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1	Highlight of the First Half of FY2020
9. Consolidated Balance Sheet	（Hundred millions of yen）

		2020.3	2020.9		Change
Current assets	1,689	1,534	-155
	Cash and deposits	576	508	-67
	Notes receivable, Accounts	967	831	-135
	receivable from completed
	construction contracts and other
	Securities	35	10	-25
	Costs on uncompleted
	construction contracts・Raw	34	41	6
	materials and supplies
	Other intangible assets	79	145	65
	Allowance for doubtful accounts	-3	-2	0
Non-current assets	464	543	79
	Property, plant and equipment	104	105	0
	Goodwil	7	48	40
	Other intangible assets	28	32	3
	Investment securities	243	274	30
	Deferred tax assets	6	5	-0
	Other	73	78	4
	Allowance for doubtful accounts	-0		-0		0
Total assets	2,153	2,077	-75

・On July 30, 2020, Taikisha Ltd. conducted a capital participation in Nicomac Clean Rooms Far East LLP a manufacturer and marketer of clean room panels in India and it became a consolidated subsidiary. As a result, goodwill increased by 4 billion yen from the end of the previous fiscal year.

		2020.3	2020.9	Change
Current liabilities	939	818	-120
	Notes payable, accounts payable
	for construction contracts and	576	395	-180
	other
	Advances received on
	uncompleted construction	143	177	33
	contracts
	Provision for loss on construction	2	1	-1
	contracts
	Other	216	244	27
Non-current liabilities	86	108	21
Total liabilities	1,025	926	-98
Total net assets	1,128	1,151	22
	Capital stock	64	64	0
	Capital surplus	50	50	0
	Retained earnings	908	915	6
	Treasury shares, at cost	-25	-25	-0
	Valuation difference on	83	105	21
	available-for-sale securities
	Deferred gains or losses on	-0	-0	-0
	hedges
	Foreign currency translation	3	-4	-8
	adjustment
	Accumulated remeasurements of	-3	0	3
	defined benefit plans
	Non-controlling interests	46	45	-0
Total liabilities and net assets	2,153	2,077	-75

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• Results of Green Technology System Business

１. Orders-received / Net sales of completed construction contracts

Orders-received

			24.1%		32.7%
	21.3%
1,000	884
800	252		786
28.5%
600			235	30.0%	594
					161	27.2%
400	443	50.1%	360	45.9%
			238
					40.1%
200
	188	21.3%	189	24.1%	194	32.7%

0

2018.9 2019.9 2020.9

Building HVAC

Industrial HVAC (Japan)

Sales	（Hundred millions of yen）

27.1%

24.3%

23.1%

1,000
800	691		761
600	190	27.6%	251	33.0%	573
					175	30.6%
400	313	45.3%	334	43.9%

25845.1%

200

187	27.1%	176	23.1%	139	24.3%
0
		2019.9		2020.9
2018.9

Industrial HVAC (Overseas) ―Overseas Ratio

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• Results of Green Technology System Business

2. Order of the market classification（Non-consolidated）

（Hundred millions of yen）

450

400

350

300

250

200

150

100

50

0

2019.9 2020.9

255

147	154
		80	55 43								83
			20		18		13	13 12		41
			7	2	4	4	10
Electronic and	Office	Pharmacy Accommodation	Precision	Commercial	School,	Station, airport Others
electrical industry	building			machinery			educational

institution

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• Results of Green Technology System Business

3. Order of the market classification（Consolidated）

（Hundred millions of yen）

450

400

350

300

250

355

2019.9

2020.9

200

150

100

50

0

191	159 146
										144
			61 48								94
				24		22		16	15 12		34 38
				3	7	5
Electronic and	Office	Pharmacy	Precision	Accommodation	Commercial	School,	Others	Uncategorized
electrical industry	building		machinery					educational		orders-received
										institution		by small-scale
												affiliates

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• Results of Green Technology System Business

700

600

500

400

300

200

100

0

4. Renewal construction（Consolidated）

Orders-received				Sales	（Hundred millions of yen）
				（％: Renewal Ratio）
	632					700
			550			600
							500	510
	307					500
	49%		247		433
						239		397
			45%			400		292
					235
					300		58%	47%		214
252					54%		251
	235						54%
						190		81
110		81		161		200		175
				32%
44%	325	34%	303	118			83		271	81
				198	100	44%	208	47%	183
142		154		170
		73%			107		94
				43		0
2018.9	2019.9	2020.9	2018.9	2019.9	2020.9
		Building HVAC（Renewal）		Industrial HVAC（Renewal）
		Building HVAC（New）		Industrial HVAC（New）
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• Results of Paint Finishing System Business

１. Orders-received / Net sales of completed construction contracts

600

500

400

300

200

100

0

Orders-received					Sales		（Hundred millions of yen）
			85.9%									83.2%
	82.5%						84.2%
							80.1%
79.9%
					600
						500
	398		350			400
	69
300	17.5%					297		288
49	14.1%
		300				242
60	20.1%						46	15.8%	57
						19.9%
									40	16.8%
						200
	328
240	82.5%	300	85.9%			250	84.2%	230
79.9%		100		80.1%	201
						83.2%
						0
2018.9	2019.9		2020.9			2018.9		2019.9		2020.9
	Paint Finishing (Japan)		Paint Finishing (Overseas)	―Overseas Ratio

27	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Results of Paint Finishing System Business

２. Order ratio from non Japanese customers

600

500

400

64.4%

26.6%

16.0%

398

350

（Hundred millions of yen）

Japanese customer

300

200

300

292

252

125

Non Japanese customer

• Non Japanese ratio

＊The order of the overseas Japanese-joint

100

0

48

225

106

venture (including all of Japanese customer investment companies) is included in the total value of the Japanese customer.

2018.92019.92020.9

28	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Main projects in Order/ Sales / Carried forward

１. Orderfrom project more than 5 hundred millions of yen

Number of cases over 5 hundred millions of yen / construction, market classification

Orders- received

23 cases

445 hundred millions of yen

		Office building	1
		School, educational institution	1
Japan		Commercial	1
	Accommodation	1
132	13	Station, airport	1
cases	Electronic and electrical industry	4
hundred millions of
	Precision machinery	1
yen
	Iron manufacture machinery	1
		Pharmacy	1
		Automobile	1
		Office building	1
Overseas		Electronic and electrical industry	1
	Other factory	1
	10
312	Automobile	4
Cases
Truck	1
hundred millions of
yen		Railway	1
		Motorcycle	1

29	Copyright 2020 Taikisha Ltd., All Rights Reserved.

4Main projects in Order/ Sales / Carried forward

2. Salesfrom project more than 5 hundred millions of yen

Number of cases over 5 hundred millions of yen / construction, market classification

			Office building	4
Sales	Japan		School, educational institution	1
16	Accommodation	1
144
27 cases	Cases	Electronic and electrical industry	6
hundred millions of yen		Pharmacy	3
285			Transportation equipment	1
hundred millions of	Overseas		Office building	1
yen	11
141	Commercial	1
	Cases
	hundred millions of yen	Automobile	9

30	Copyright 2020 Taikisha Ltd., All Rights Reserved.

4Main projects in Order/ Sales / Carried forward

3. Carried forwardfrom project more than 1billion yen

						Planned
Number of projects over 1 billion yen / construction, market classification	project to be
completed
						in FY2020
			Office building		7
			Administrative facility		1
	Japan	16	Accommodation		1
	367	Medical and social welfare		1
Carried	hundred	cases	Electronic and electrical industry	2	1
millions of yen		Pharmacy		2
forward			Research and development		1
39 cases			Construction machine		1
		Office building		2
1,066			Station, airport		2
Overseas		Electronic and electrical industry	2
hundred millions		Pharmacy		1
of yen	698	23
Other factory		1
	hundred	cases
	Automobile		12	3
	millions of yen
		Truck		1
			Railway		1
			Motorcycle		1
			31	Copyright 2020	Taikisha Ltd.,	All Rights Reserved.

• Earnings Forecast for FY2019

Expectations by Business

					2020.3
	Green Technology	Paint Finishing		Total
	H1	H2	Total	H1		H2	Total	H1	H2	Total
Order-	786	819	1,605	398		265	663	1,184	1,084	2,269
received
Sales	761	812	1,573	288		391	680	1,049	1,204	2,253
Operating	72	63	135	5		22	27	75	78	154
income
Ordinary	74	64	138	5		22	28	76	83	159
income
Net	-	-	-	-		-	-	53	37	91
income

（Hundred millions of yen）

2021.3

Green Technology	Paint Finishing		Total
H1	H2(E)	Total(E)	H1	H2(E)	Total(E)	H1	H2(E)	Total(E)
594	705	1,300	350	369	720	945	1,074	2,020
573	726	1,300	242	487	730	815	1,214	2,030
42	63	106	-10	22	12	31	78	110
44	63	108	-10	23	13	37	82	120
-	-	-	-	-	-	30	49	80

• Results of FY2019 H1:1US$=¥110.11, 1€=¥124.47, 1THB=¥3.48
  ②Results of FY2020 H1:1US$=¥108.44, 1€=¥119.85, 1THB=¥3.44

• FY2020 Estimation︓1US$=¥106.00, 1€=¥117.00, 1THB=¥3.49

Effects of foreign exchange differences between ① and ②on

Sales : △9.3 hundred millions of yen, Ordinary income : +0.3hundred millions of yen.

Effects of foreign exchange differences between ②and ③on

Sales : +4.6 hundred millions of yen, Ordinary income: +0.1 hundred millions of yen.

• Influence for the earnings forecasts for FY2020 when all exchange rates fluctuate by 1% is;

Orders/Sales︓Approximately 10 hundred millions of yen, Ordinary income︓Approximately 0.3 hundred millions of yen

32	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Earnings Forecast for FY2020

Earnings Forecasts by Business

Orders-received

Sales

(Hundred millions of yen)

2,500

2,000

1,500

1,000

500

0

	2,418		2,269
	467	19.3%	477	21.0%	2,020
			355
					17.6%
	694	28.7%	632	27.9%
			558	27.6%
	423	17.5%	495	21.8%	387	19.2%
	136	5.7%
	136	6.0%	122	6.0%
	696	28.8%	527	23.3%	598	29.6%
2019.3		2020.3		2021.3(E)

2,500

2,000

1,500

1,000

500

0

	2,254		2,253		2,030
	461	20.5%
	549	24.4%	360	17.7%
	613	27.2%	634	28.2%	558	27.5%
	416	18.5%	389	17.3%	382	18.8%
	117	5.2%	139	6.2%	134	6.6%
	645	28.6%	540	24.0%	596	29.4%
2019.3		2020.3		2021.3(E)

Building HVAC	Paint Finishing(Japan)
Industrial HVAC(Japan)	Paint Finishing(Overseas)
Industrial HVAC(Overseas)

33	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Earnings Forecast for FY2020

Total（Japan／Overseas）

Orders-received

2,500		2,418	2,269
2,000				2,020
	1,298
		1,245
1,500				1,035
		1,185	1,184
1,000		7561,120	666	945
		449
		1,023
500			985
	46.3%	45.1%	48.8%
		428	518	495
0		36.2%	43.8%	52.5%
	H1Total	H1Total	H1Total
	2019.3	2020.3	2021.3 (E)

2,500

2,000

1,500

1,000

500

0

（Hundred millions of yen) （%: Overseas ratio）

Sales

2,254 2,253

2,030

1,192	1,323
	1,052

988	1,049	815
5501,061	642	474 978
	930
47.1%	41.3%	48.2%
437	407	341
44.3%	38.8%	41.8%
H1Total	H1Total	H1Total
2019.3	2020.3	2021.3(E)

34	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Earnings Forecast for FY2020

Green Technology System Division （Japan/Overseas）

2,000	Orders-received	2,000
		1,585	1,605
1,500			1,500
				1,300
1,000	1,162	1,109	1,000

（Hundred millions of yen） （%: Overseas ratio）

Sales

1,491 1,573

1,300

1,075 1,184

884	786	913

691 761

918

	696		594
500	596	400	500
	423	495
	387
	18826.7%	18930.9%	19429.8%
0	21.3%	24.1%	32.7%	0
H1Total	H1Total	H1Total
	2019.3	2020.3	2021.3(E)

	585		573
504		433
416
176	389	382
18727.9%	24.8%	13929.4%
27.1%	23.1%		24.3%
H1Total	H1Total	H1Total
2019.3	2020.3	2021.3(E)

35	Copyright 2020 Taikisha Ltd., All Rights Reserved.

• Earnings Forecast for FY2020

Paint Finishing System Division （Japan/Overseas）

Orders-received

1,000		833			1,000
		136		663	720
				122
				136
500		696	398		500
		527	350
		300	69
		60			49 598
		83.6%	328	79.5%	30083.1%
		240
		79.9%	82.5%	85.9%
0			0
	H1Total	H1Total
		H1Total
2019.3	2020.3	2021.3(E)

（Hundred millions of yen) （%: Overseas ratio）

Sales

762		730
117	680
134
	139
645	540
297	288	242 596
46	57
84.6%	79.5%	4081.6%
250	230	201
84.2%	80.1%
83.2%
H1Total	H1Total	H1Total
2019.3	2020.3	2021.3(E)

36	Copyright 2020 Taikisha Ltd., All Rights Reserved.

６Shareholders Returns

Purchase / Retirement Disposal of Treasury Shares

Purchase	Record
	Date	Number	Unit	Amount
	Price	(million
	(thousand)
				(yen)	yen)
2005/12	40	1,933	77
2006/2	597	1,780	1,062
2006/7,8	500	1,401	700
2011/8	300	1,576	472
2012/11	600	1,614	968
2013/12	800	2,170	1,736
2015/5	680	3,245	2,206
2016/11	356	2,805	999
2017/11,12	136	3,654	499

Retirement Record

Date	Number(thousand)	Unit	Amount
Price	(million
		(yen)	yen)
2008/8	1,200	1,593	1,912
2018/2	1,700	2,443	4,154

Disposal Record		（by ESOP）
Date	Number(thousand)	Unit	Amount
Price	(million
			(yen)	yen)
2013/2	180	1,860	334

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6Shareholders Returns

Net income & Cash Dividends

（億円／円）										（%）
120.0										45
100.0										40
									35
80.0										30
60.0										25
									20
40.0										15
20.0										10
									5
0.0										0
	2012.3	2013.3	2014.3	2015.3	2016.3	2017.3	2018.3	2019.3	2020.3	2021.3
	(E)
Net income(hundred millions of yen)	43.7	62.0	41.5	60.8	70.8	63.0	72.5	88.4	91.3	80
Cash dividends per share(yen)	35	50	45	52	67	70	75	91	100	90
Dividend payout ratio(%)	29.3	29.2	38.8	30.1	32.8	38.2	35.3	35.1	37.3	38.3

The basic policy is to implement steady dividends by targeting a consolidated dividend payout ratio of 35%.Regarding the estimated annual dividend ended March 31, 2021, it is 90 yen per share. (dividend payout ratio of 38.3%)

38	Copyright 2020 Taikisha Ltd., All Rights Reserved.

2. Initiatives of each strategy

in mid-term business plan (FY2019-2021)

39	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Long-term Vision／Quantitative Targets／Investment theme

40	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Basic Policy and Direction／Strategy

41	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Achievement①〜

Strategy︓Respond to social needs through business operations➀

Exterior appearance "Barrier Cube"

Evacuation Shelter

42	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Achievement③〜

Strategy︓Respond to social needs through business operations②

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Initiatives of each strategy 〜Achievement③〜

Strategy︓Expansion of overseas business domain through capital alliance

At the end of July 2020, Taikisha Ltd. (hereinafter "Company") conducted a capital participation in Nicomac Clean Rooms Far East LLP, a manufacturer and marketer of clean room panels in India (hereinafter "Nicomac").

Nicomac manufactures and sells high quality panels to Indian pharmaceutical manufacturers as its main customers.

Taking advantage of this capital participation, in the Indian market, which is expected to grow economically in the medium to long term, the Company aims to strengthen its ability to respond to the Indian clean room construction market, by combining Nicomac's panel manufacturing and installation technologies with air conditioning system technologies of the Company, mainly in the pharmaceutical manufacturing environment, which requires high performance air conditioning systems.

44	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Main initiatives in progress①〜

Strategy

Enhance added value

〜Energy-saving,cost-saving and environment-responsive technology and automation technology, etc.

Main initiative in progress

Develop and commercialize the paint system that remarkably improves coating efficiency

Taikisha is promoting to develop and to commercialize the paint system that remarkably improves coating efficiency related to reduce CO₂emissions.

Upgrade and utilize

laboratories

〜Reinforce technological

development capabilities and

strengthen proposal

capabilities through the

visualization of technology

Utilize IoT・AI

〜Promote the development of

new solutions

Reconstruct Research and Development Center as demonstration center

Taikisha is considering reconstruction of Research and Development Center as inspection facility to propose customers to technologies related to Green Technology System Division.

Develop and commercialize IoT and AI-based predictive maintenance system in factories

Taikisha is promoting business activity to expand introduction of i-Navistar. (an IoT and AI-based root cause analysis system for analyzing causes of suspended operation and quality defects on automotive paint)

45	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Main initiatives in progress②〜

Strategy

Enhance productivity

Main initiative in progress

Develop the automation system to draw the design and to estimate

Taikisha is developing the automation system to draw the design and to estimate.

Expand new

businesses

〜The plant factory business and the paint finishing system business for large vehicles other than automobiles

Construct Taikishaʼs own plant factory

Taikisha is considering establishment and demonstration of mass- production and automation technology, additionally construction of the facility to propose to customers.

Develop and commercialize automated polishing system for aircraft and railway cars

Taikisha is promoting business activities and technology demonstration for order-receiving the first project.

Expand business areas		Consider establishing affiliates in new countries

into new countries	Taikisha is considering establishing the new affiliates in the area that
	is expected to invest.

46	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Main initiatives in progress③〜

Strategy

Main initiative in progress

Secure human

resources

〜Measures to make the Company more attractive including the enhancement of systems to enable flexible work styles, improvement of benefits and reduction of working hours

Reinforce human capital

and organizational

capabilities through the

utilization of diverse

human resources

Efforts for post-corona damage such as expansion of telework system

Taikisha is considering measures to improve the working styles of employees and improve work efficiency in anticipation of the post- corona damage, such as expanding the telework system suitable for Taikisha.

Introduce of telework

Taikisha is considering arrangement of making effective use of time and providing job opportunities for employees on administrative leave and retirees by introducing telework, as working from home, mobile work, working at satellite offices.

Utilize of diverse human resources

To promote womenʼs career advancement, female employees can take flexible leave according to life event. And Taikisha provides job training guidance for employees reinstated. Also, Taikisha is considering correspondence of employment until 70, which the Japanese Government promotes.

47	Copyright 2020 Taikisha Ltd., All Rights Reserved.

Initiatives of each strategy 〜Main initiatives in progress④〜

Strategy

Reinforce corporate

governance

〜Reinforcement of the management oversight functions of the Board of Directors and capital cost- conscious management

Reinforce the internal control system both in Japan and overseas

Improve the global risk

management system

〜Legal risks, information security, compliance, etc.

Main initiative in progress

Deepen consideration about capital cost, capital and shareholders returns policy

To aim for increase corporate value, Taikisha is promoting capital cost-conscious management, consideration about capital and shareholders returns policy.

Reinforce the internal control system related IT

Taikisha is considering reinforcing internal control system to maintain and supervise IT in the entire group.

Reinforce the global information security measure

Taikisha is considering reinforcing information security measure in overseas affiliates.

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Precaution about Forward Perspective

The data and future prospect in this material is based on the judgment on the announcement date and the available information. They are possible to change by various kinds of factors and can not guarantee the achievement of goals and future performance. This information is subject to change without notice.

We therefore recommend that you use this information with checking and confirming other information as well.

Taikisha assumes no responsibility whatsoever for any damages resulting from the use of this material.

Contact information for inquiry about this material

Investor Relations Section, Administrative Management Headquarters,

Taikisha Ltd.

TEL︓[phone]FAX︓[phone]

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