Results of Operations for the First Half of the Fiscal Year Ending March 31, 2020

1

October 30, 2019

IR Contact: Business Strategy & Management Dept. (TEL: +81-(0)6-6456-4633 E-mail: ir@nihon-trim.co.jp)

The information, forecasts, etc. available in this material are the Company’s judgment as of the preparation date thereof and do not always guarantee the accuracy of these information. Further, the Company and the information provider will not be responsible for any damages incurred according to these information. * The material is not prepared for the purpose of soliciting investments.

2

Overview of the Nihon Trim Group Business Pages 3 - 13

Business Performance, Indices, etc. Pages 15 - 17

Transforming into a Global Medical Company

Reform direct sales (to be more B-to-B oriented with a lump-sum purchase proposal)

Expand sales overseas

Elucidate new mechanism of EHW

Full-scale business of the electrolyzed water hemodialysis

Strengthen and expand the regenerative medicine business

Hospital Operation in China

3

12,763 13,018 13,275

11,634 12,016

7,784 7,798 8,487

8,060 7,336

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000Nationwide Nihon Trim

FY3/14FY3/13 FY3/15 FY3/17 FY3/18

(Yen)

61% 60%63.9% 69.3%

61.0%

* FY3/13 – FY3/15: Company Workforce Health Diagnosis by Japan Health Insurance Association; FY3/17 – FY3/18: Survey on Trends in Medical Expenditures of Health Insurance Associations

* FY3/16: No data available due to a change from Japan Health Insurance Association to the National Federation of Health Insurance Societies

Monthly Healthcare Cost (per capita)

Water Healthcare Business

4

Expanding Lump-sum Purchase by Companies with Health and Productivity Management® Proposals

5

Branches and offices

Households

Results (as of Sept. 30, 2019): 1,598 units installed by 1,055 companies; 1,860 units purchased by employees

Water Healthcare Business

Companies

Company A

Workspace Sales: Improving Sales Efficiency

1.50

1.70

1.90

2.10

2.30

2.50

2.70

2.90

3.10

3.30

3.50

Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar.

Trends on Sales Efficiency (for 3 years)

FY3/18 FY3/19 FY3/20

6

Water Healthcare Business

Enhancing Promotion

7

Water Healthcare Business

AR App Markers

Enhance promotional activities at restaurants

Controlled medical device

Water with recognized

effect

Choose the better water

We use electrolyzed hydrogen water.

• It relieves upset and discomforting stomach.• It helps the gastrointestinal function and

improves bowel movement.

Electrolyzed hydrogen water brings out the original taste of the foodstuff.

Cooking rice Simmering Making tea

NIHON TRIM CO., LTD.

New initiative of water-focused healthcare

We are on social media!

Electrolyzed hydrogen water apparatuses

Improving gastrointestinal problemsMedical equipment manufacture certification number:

EHW apparatus of Nihon Trim is a controlled medical device recognized for its effectiveness against gastrointestinal symptoms.

Plum and glossy, delicious rice.

Delicious soup filled with flavor of ingredients.

Delicious salad keeping the nutrients.

Flavorful and mellow, delicious tea.

Tastes nice & good for your stomachElectrolyzed hydrogen water is made by electrolyzing purified water. It is alkaline and contains hydrogen.

● Improving gastrointestinal problems (efficacy)

Washing vegetables

Medical technology

Improve gastrointestinal

problems

Electrolyzed hydrogen water

(EHW)

Stay healthy just by drinking it

Water constitutes 60% of human body

Cartridges: Steady Growth

1,778 1,988 2,190 2,203

2,447

1,758

1,897 1,953 2,040

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

4,500

FY3/16 FY3/17 FY3/18 FY3/19 1H FY3/20

1H 2H

8

Sales(Millions of yen) 4,2434,143

3,536

3,835

Water Healthcare Business

Current number of customers: Approx. 850,000.Aim to acquire 3 million users and achieve 20 billion yen in sales (assuming a 70% replacement rate).

Indonesia:Sales Rapidly Increasing through business with the Country’s Largest Franchise Chains

22,306

41,813 41,861 52,934

75,479 28,674

39,566 49,646

73,027

FY2015 FY2016 FY2017 FY2018 1H FY20191H 2H

9

In millions of Rupiah (IDR1 = JPY0.0077)

125,961

91,507

81,380

50,980

Our products delivered to about 25,000 stores of major franchises.

Aiming for sales of 17.0 billion yen in 2025.

Water Healthcare Business

Research & DevelopmentResearch Institute Research Theme Method & Form Progress

1 RIKEN Mechanism for the benefits of EHW Basic/animal/ human/clinical studies

Basic, animal and clinical studies are simultaneously promoted.

2 School of Medicine, Tohoku University

Effects of drinking EHW on diabetes Clinical studies Paper has been submitted to an international academic journal.

3Susaki City, Kochi Prefecture; Kochi Medical School

Lifestyle diseases Clinical studies Data analysis to be completed by the end of 2019.

Reduction of healthcare expenditures

Epidemiological survey

Research volunteers have been solicited since July 2019.

4 Karolinska Institute Antidepressant effect of EHW Basic study Now under research.

5 School of Engineering, The University of Tokyo

Physical properties of EHW Basic study Papers to be published in FY3/21.

6 Joint Faculty of Veterinary Medicine, Yamaguchi University

Effects of drinking EHW on racing horses

Animal Now under research.

7 Faculty of Sport and Health Science, Ritsumeikan University

Exercise performance Human Papers to be published in FY3/20.

8 Faculty of Human Sciences, Waseda University

Effects of the mechanism for the benefits of EHW

Basic study Important results have been acquired in interim report. Research in the progress.

9 Faculty of Agriculture and Marine Science, Kochi University

Demonstration of cultivation of Kangen Vegetables

Basic study Now under research

10

Water Healthcare Business

Electrolyzed Water Hemodialysis Business:

Improving public awareness of electrolyzed water hemodialysis

Actual sales for 1H FY3/20: 91 million yen

Estimated sales for FY3/20: 170 million yen (compared with 16 million yen for FY3/19)

Cumulative total installed: 483 beds at 22 institutions (approx. 1,500 patients)

Aim for 100 hospitals with sales of 2.8 billion yen within 3 years

Number of dialysis institutions in Japan: Approx. 4,400

11

Electrolyzed water hemodialysis seminar crowded with participants (organized by the Japanese Society for

Dialysis Therapy in June 2019)

Outlook for the business

Medical Business

Cord Blood Business Making Rapid Progress

380 397 425 544

808 374 410 433

608

100 95 66 129

222

186 160 110

219

0

200

400

600

800

1000

1200

1400

FY3/16 FY3/17 FY3/18 FY3/19 1H FY3/20

2H

1H

Operating profit for 1H

Operating profit for full year

Usage rate of private cord blood bank

Approx. 12%

Approx. 3%

Approx. 0.6%

12

Joint research:IMSUT Hospital, The Institute of Medical Science, The University of Tokyo“Establishment of an autologous cord blood storage system” (Since 2018).

(Millions of yen)

754807

858

1,153

Medical Business

Hospital Operation in China：Alliance with State-owned Company, PICC

13

• Increasing number of private medical treatment

• Application for public insurance coverage

• Target:5.0 billion yen / year20% operating margin

• Coverage by public insurance

*Largest insurance company in China, holding approx. 33% share of direct premiums.

• Contracting health management of corporate customers

• Target: 10 institutions50.0 billion yen / year20% operating margin

• Provision of high-quality medical care

• Development into the cities in China

• Enhancing promotion

• Developing transactions with PICC (*) and other corporations.

• Provision of high-quality medical care

• Start contributing to the earnings in FY2021

Medical Business

Developing infrastructure for business expansion

Increasing number of clinicians

Establishing business modelExpand operationsacross China

14

Overview of the Nihon Trim Group Business Pages 3 - 13

Business Performance, Indices, etc. Pages 15 - 17

1H FY3/20 Results: Consolidated Statement of Income(Rounded down to millions of yen)

1H FY3/19 Results 1H FY3/20 Results Change (Amount)

Change (%)Amount % Amount %

Net sales 7,900 100.0% 8,693 100.0% 793 10.0%

COGS 2,187 27.7% 2,505 28.8% 318 14.6%

Gross profit 5,712 72.3% 6,187 71.2% 474 8.3%

SG&A expenses 4,337 54.9% 4,572 52.6% 235 5.4%

Operating profit 1,375 17.4% 1,615 18.6% 239 17.4%

Non-operating income 67 0.9% 82 0.9% 14 21.2%

Non-operating expenses 112 1.4% 179 2.1% 66 59.3%

Ordinary profit 1,330 16.8% 1,517 17.5% 187 14.1%

Extraordinary income - - 14 0.2% 14 -

Extraordinary losses 11 0.1% - - -11 -

Profit before income taxes 1,318 16.7% 1,532 17.6% 213 16.2%

Income taxes 466 5.9% 525 6.0% 59 12.7%

Profit 852 10.8% 1,006 11.6% 153 18.0%Profit attributable to non-controlling interests 25 0.3% 4 0.0% -21 -84.2%

Profit attributable to owners of parent 827 10.5% 1,002 11.6% 175 21.2%

Net income per share (Yen) 103.13 126.96 23.83 23.1%

15

Business Performance, Indices, etc.

1H FY3/20 Results: Sales by Business Segment(Rounded down to millions of yen)

1H FY3/19 Results 1H FY3/20 Results Change (Amount)

Change (%)Amount % Amount %

Water H

ealthcare B

usin

ess

(Flow-type business)

DS Division (workplace sales) 2,412 30.5% 2,503 28.8% 90 3.8%

HS Division (installation and referral sales) 989 12.5% 1,028 11.8% 39 3.9%

SS Division (store event sales) 352 4.5% 325 3.7% -27 -7.7%

OEM and wholesale sales 397 5.0% 333 3.8% -64 -16.1%

After-sales services 153 1.9% 185 2.1% 31 20.5%

EHW apparatus sales, total 4,305 54.5% 4,375 50.3% 70 1.6%

(Stock-type business)

Cartridges 2,200 27.9% 2,447 28.2% 247 11.2%

(Sales of subsidiaries)

TRIM (Guangzhou) Water & Health Co., Ltd. 55 0.7% 40 0.5% -15 -27.7%

PT. SUPER WAHANA TEHNO 407 5.2% 581 6.7% 173 42.6%

(Others) 330 4.2% 320 3.7% -10 -3.2%

Total 7,300 92.4% 7,765 89.3% 464 6.4%

Me

dical B

usin

ess

Regenerative medicine 544 6.9% 808 9.3% 264 48.5%

Electrolyzed water hemodialysis and MGO measurement

14 0.2% 91 1.1% 77 531.0%

Others 40 0.5% 27 0.3% -13 -32.1%

Total 599 7.6% 928 10.7% 328 54.8%

Consolidated, total 7,900 100.0% 8,693 100.0% 793 10.0%

16

Business Performance, Indices, etc.

Dividend policy: Emphasize paying stable dividends/ Implement dividend increase in view of the results

25 25

30

35

50 50

60 60 60 60

70

2010/3月期 2011/3月期 2012/3月期 2013/3月期 2014/3月期 2015/3月期 2016/3月期 2017/3月期 2018/3月期 2019/3月期 2020/3月期

（予想）(Forecast)

17

(Yen)

Adjusted for the number of shares after dividend

2-for-1 stock split in October 2013

FY3/12FY3/11 FY3/13 FY3/14 FY3/15 FY3/17FY3/16 FY3/18 FY3/19FY3/10 FY3/20

Business Performance, Indices, etc.