#HokkoChemicalIndustry

Trust of JPY 287,000,000 will be established and 160,000 shares of treasury stock will be acquired to start a performance-linked stock compensation plan for executives from May 8, 2026.

On May 8, 2026, 160,000 shares of treasury stock will be disposed of by third-party allotment at 1,780 yen per share, totaling 284,800,000 yen, to fund the introduction of a stock compensation trust for executives.

Plans to dispose of 15,000 shares of treasury stock as restricted shares to the employee stock ownership plan at 1,780 yen per share, totaling 26,700,000 yen, on August 31, 2026.

Net sales for Q1 of the fiscal year ending November 2026 were JPY 16,243 million (up 5.8% YoY), operating income was JPY 2,286 million (up 20.5% YoY), and net income attributable to owners of parent was JPY 1,734 million (up 22.6% YoY).

For Q1 of the fiscal year ending November 2026, net sales reached 16,243 million yen (+5.8% YoY), operating income was 2,286 million yen (+20.5% YoY), and net income attributable to owners of the parent was 1,734 million yen (+22.6% YoY), achieving revenue and profit growth.

A numerical error in the ordinary income figure for FY2023 was discovered and corrected in the 'Response Towards Realizing Management Focused on Capital Cost and Stock Prices (Update)' disclosed on January 13, 2026.

Hokko Chemical Industry revised the consolidated performance targets in its long-term management plan and the second three-year management plan, raising the fiscal 2029 sales target to ¥55 billion (+¥3 billion) and ordinary income to ¥6.8 billion plus α (+¥0.8 billion plus α).

For the fiscal year ending November 2025, consolidated net sales were 491.25 billion yen (6.3% increase YoY), operating income was 4.913 billion yen (8.2% increase YoY), and net income attributable to owners of parent was 4.452 billion yen (11.1% increase YoY).

Hokko Chemical Industry plans to introduce a performance-linked stock compensation plan for directors and others, subject to approval at the shareholders meeting on February 26, 2026, setting a trust with an initial cap of 400 million yen.

In fiscal 2025, treasury stock acquisition amounted to 1,199 million yen, and the policy for reducing strategic shareholdings is set to below 20% of net assets by fiscal 2030. ROE remains above 8%, with dividend forecast for fiscal 2026 at 54 yen (payout ratio of 31.2%).

Decided a policy to reduce strategic shareholdings of 18.1 billion yen (34.2% of net assets) as of the end of November 2025 by approximately 30% by fiscal year 2030, lowering the net asset ratio to below 20%.