Financial Results for the First Six Months of the Fiscal Year Ending March 31, 2022 -Started to Implement a New Medium-Term Management Plan, Innovation Plan 2024 "Design the Future Life"- (699KB)

October 28, 2021

To whom it may concern

TOKAI Holdings Corporation

Katsuhiko Tokita, President & CEO

(Code No. 3167 Tokyo Stock Exchange First Section)

Financial Results for the First Six Months of the

Fiscal Year Ending March 31, 2022

Started to Implement a New Medium-Term Management Plan,

Innovation Plan 2024 "Design the Future Life"

TOKAI Holdings Corporation (hereinafter, "the Company") today announced its financial results for the first six months of the fiscal year ending March 31, 2022.

1. The Company continued to expand its earnings base to achieve a net annual increase of 100,000 in customer count.

The Company announced the fourth Medium-Term Management Plan, Innovation Plan 2024 "Design the Future Life" ("IP24"*1) in May. The plan covers a period from this fiscal year to the fiscal year ending March 31, 2025. A key strategy in IP24 is "LNG strategy." The Company will expand its business areas at the Local level (expansion of share in existing areas), at the National level (expansion of new business areas in Japan), and at the Global level (business development overseas) and will achieve growth in the number of customers through selection and concentration, focusing on profitability.

To achieve 3.56 million customers at the end of the fiscal year ending March 31, 2025, the Company will pursue an aggressive strategy to expand its earnings base, aiming to achieve 3.20 million customers (a net annual increase of 100,000 in customer count) at the end of the fiscal year under review.

In operating activities in the first six months of the fiscal year under review, the Company conducted remote sales activities that do not involve direct human contact and was thorough in taking other measures to prevent COVID-19 infections. Meanwhile, the Company took proactive steps to attract customers and recorded 3,125,000 continuing customers as of September 30, 2021. This continuing customer number exceeded the count at the beginning of the fiscal year (3,099,000) by 26,127 (versus an increase of 39,003 in the same period of the previous fiscal year, including M&A-related8,253).

With net increases of 19,920 (LP and city) gas customers (15,365 in the same period of the previous fiscal year), 16,613 CATV customers (25,077, including M&A-related 8,253 customers), and 2,913 Aqua (bottled drinking water delivery) customers (a decrease of 247 in the same period of the previous fiscal year), we further expanded our earnings base.

2. Sales increased for the first time in two periods and hit a record high.

In the six months ended September 30, 2021, the Company recorded sales of 96.1 billion yen (up 6.2 billion yen or 6.9% year on year), the first increase in two periods and a record high. Sales increased chiefly due to increases in the numbers of energy customers and CATV customers, expansion of recurring-revenuebusinesses in the Information and Communications business for corporate clients, and the effect of M&A in the Construction, Equipment, and Real Estate business.

On the profit front, operating profit was 5.2 billion yen, down 200 million yen, or 4.2% year on year, which was almost on a par with that of the same period of the previous year. This was mainly due to an increase in the number of monthly fee-paying customers that accompanied a higher customer account and an increase in profit in the Information and Communications business, despite an increase in expenses for gaining customers, reflecting more LP gas and Aqua customers gained than a year ago, and expenses to improve the working environment as part of work-style reform.

Quarterly net income attributable to owners of the parent was 2.3 billion yen, down 1.0 billion yen, or 30.4% year

on year, due mainly to the recording of a temporary extraordinary loss.

Net sales, operating profit, and recurring profit each exceeded the Company's internal plan, and quarterly net income attributable to owners of the parent was generally in line with the internal plan, despite the aforementioned temporary extraordinary loss.

						(Millions of yen)
	Q2 FY03/22 results	Q2 FY03/21 results		YoY
	(April 1, 2021 to	(April 1, 2020 to
	Change			% change
	September 30, 2021)	September 30, 2020)
Net sales	96,060	89,836		+6,224		+6.9%
Operating profit	5,223	5,452		-229		-4.2%
Recurring profit	5,284	5,499		-214		-3.9%
Net income	2,281	3,279		-997		-30.4%
EPS (yen)	17.42	25.04		-7.62		-30.4%

3. Started to implement a new Medium-Term Management Plan, Innovation Plan 2024 "Design the Future Life"

With its Corporate Philosophy "For customers' livelihood along with the region, together with the earth, we will continue to grow and develop" as an unchanging value, the Group will adapt to changes in customers' lifestyles and changes in society and the environment and, while supporting and staying close to customers, aims to evolve into a "Life Design Group" that designs and provides the new lifestyles of the future, ready to take on new challenges described in the new Medium-Term Management Plan "IP24."

The fiscal year ending March 31, 2022 is a year where the Group will lay foundations for achieving the goals described in the five key messages in IP24: (i) Implementation of LNG strategy, (ii) Evolution of TLC*2 concept,

1. Stepping up of DX strategy, (iv) Optimal allocation of management resources, and (v) Strengthening of SDG initiatives.
   To expand the earnings base, the Company will actively make investments to gain customers, primarily in the LP gas business, and factors in expenses for developing an environment for workstyle reform. Meanwhile, the Company will continue to increase annual sales and profit.
   The earnings and dividend forecasts for the fiscal year ending March 31, 2022 remain unchanged.

								(Millions of yen)
	FY03/22 forecast	FY03/21 results		YoY
	(April 1, 2021 to	(April 1, 2020 to
	Change		% change
	March 31, 2022)	March 31, 2021)
Net sales	207,000	196,726	+10,274		+5.2%
Operating profit	15,240	15,226	+14		+0.1%
Recurring profit	15,320	15,312	+8		+0.1%
Net income	8,830	8,815	+14		+0.2%
EPS (yen)	67.42	67.32	+0.10		+0.2%
Customer count at	3,195,000	3,099,000	+97,000		+3.1%
end of fiscal year
		FY03/22		FY03/22			FY03/21
		(forecast)
Interim (end of Q2)				15.00 yen		14.00 yen
Year-end			15.00 yen					16.00 yen
Annual dividend per share		30.00 yen					30.00 yen

For details, please see the attached materials, entitled "Financial Results for the First Six Months of the Fiscal Year Ending March 31, 2022."

For the Company's earnings announcement for the first six months of the fiscal year ending March 31, 2022, please see the following URL:

https://www.tokaiholdings.co.jp/ir/library/earnings.htm

*1 For the details of the fourth Medium-Term Management Plan "IP24," please see the following URL: https://www.tokaiholdings.co.jp/ir/management/manageplan.html

*2 TLC (Total Life Concierge) concept: The Group will provide a comprehensive range of carefully tailored services to help customers live more comfortable lives and aim to improve customer satisfaction.

Contact: Yoshihiro Taniguchi

Public Relations and Investor Relations Office

TEL: [phone]

Email: [e-mail]

Financial Results for the Second Quarter of the

Fiscal Year Ending March 31, 2022

TOKAI Holdings Corporation

(Code: 3167)

October 28, 2021

Steady growth of customer base in core businesses

• Continuing customer count reached 3,125,000 at the end of Q2, up 26,000 from 3,099,000 at the beginning of the year.
• Earnings base further expanded for mainstay gas, CATV, and Aqua businesses.

	(LP and City) Gas			CATV		Aqua
(Thousands of customers)	+20	+25			+3
		+3
				+14
+15	764	1,214	△0	165

+11

	728	1,179
	161
696
1,076	159

Q2 FY03/20	Q2 FY03/21	Q2 FY03/22		Q2 FY03/20	Q2 FY03/21	Q2 FY03/22		Q2 FY03/20	Q2 FY03/21	Q2 FY03/22
Customer count at end of period	Net increase		Customer count at end of period	Net increase		Customer count at end of period	Net increase

Note: Figures are rounded to the nearest thousand.	1
The net increase includes an increase in customers due to M & A.

(Millions of yen)

Significant increase in monthly billing for core businesses

• By expanding the number of customers, which is the revenue base, it will lead to an increase in revenue due to an increase in the number of monthly charges.

(Monthly charges number,	5,809
Thousands of customers)
3,400	2,024

		650,000
					70,000
			（up 12.7%）	5,725
						（up 3.4%）
390,000		3,327
					2,007
（up 13.0%）
		3,251
	3,180
3,126	5,344
5,269
				1,963
	5,156	1,957	1,956	1,955

3,010

1,944

2Q

4Q

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4Q

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4Q

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FY2018

FY2019

FY2020

FY2021

FY2018

FY2019

FY2020

FY2021

FY2018

FY2019

FY2020

FY2021

LP gas

CATV

Hikari

2

Collaboration

Sales hit a record high

• Sales reached a record high due to the increase in the number of customers, expansion of the information and communication business for corporations, and the effect of M & A in the building equipment real estate business.
• In terms of profits, although there were increases in customer acquisition costs and costs for improving the environment for work style reforms, profits increased due to an increase in monthly billing due to an increase in the number of customers and an increase in the information and communications business for corporations, which was about the same as the same period of the previous year.
• Due to the recording of a temporary extraordinary loss, net income decreased by 1 billion yen year-

on-year.

		Q2 FY03/22 results	Q2 FY03/21 results	YoY
		(April 1, 2021-September 30,	(April 1, 2020-September 30,
		2021)	2020)	Change	% change
Sales	96,060	89,836	+6,224	+6.9
Operating profit	5,223	5,452	-229	-4.2
Recurring profit	5,284	5,499	-214	-3.9
Net income	2,281	3,279	-997	-30.4
EPS (yen)	17.42	25.04	-7.62	-30.4

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