Shikoku Electric Power Company, Incorporated · TSE:9507

Shikoku Electric Power — FY2023 Earnings Presentation

54 slides from Shikoku Electric Power's earnings presentation, May 8, 2024

1. Slide 1: Financial Results Briefing for FY2023

   Financial Results Briefing for FY2023 (April 1, 2023 – March 31, 2024) May 8, 2024 Note: This is an accurate and complete translation of original Japanese version prepared for the convenience of our English-speaking investors. In case of any discrepancy between the Japanese and English versions, the

2. Slide 2: Contents

   Contents Key Points of Consolidated Financial Results and Forecasts of Consolidated Financial Results & Dividends 2 Supplemental Material for FY2023 29 I. Overview of Consolidated Financial [Segment Information] Results for FY2023 ➢Overview of Financial Results by Segment 30 ➢ Highlights of Financia

3. Slide 3: Key Points of Consolidated Financial Results and Forecasts

   Key Points of Consolidated Financial Results and 2 Forecasts of Consolidated Financial Results & Dividends [Consolidated Financial Results for FY2023] Revenue Decrease but Profit Increase Revenues Profit Dividend Ordinary profit < Interim dividend> 787.4 billion yen 80.0 billion yen ¥15 per share Ch

4. Slide 4: （blank space）

   （blank space） All Rights Reserved © 2024 YONDEN Shikoku Electric Power Co., Inc.

5. Slide 5: Summary of FY2023 Financial Results

   4 I. Summary of FY2023 Financial Results Summary of Financial Results (Refer to page 6 to 7 for details) (100 million yen) FY2023 FY2022 Change Growth rate Revenues 7,874 8,332 (458) (5.5)% Operating Expenses 7,088 8,454 (1,366) (16.2)％ Operating Profit(Loss) 785 (122) 907 - Non-Operating Profit 15

6. Slide 6: Key Data

   5 Key Data Key Factors for Electric Key Factors for Businesses Other Power than Electric Power (million kWh) FY2023 FY2022 Change FY2023 FY2022 Change [IT/Communications] Total Electricity Supplied *1 30,543 32,752 (2,209) Number of FTTH contract (10,000 cases) 37.3 35.6 1.7 [Energy] Electricity Sal

7. Slide 7: Details of Consolidated Financial Results

   Details of Consolidated Financial Results 6 (Electric Power and Businesses Other than Electric Power) (100 million yen) (Factors contributing to change: 100 million yen) ① [Electricity Sales (Retail)] FY2023 FY2022 Change Growth rate • Decrease in electricity sales (271) • Increase in income per uni

8. Slide 8: Factors Contributing to Change in Consolidated Ordinary Profit

   7 Factors Contributing to Change in Consolidated Ordinary Profit from Previous Fiscal Year (100 million yen) +1,025 FY2022 FY2023 (Electric Power) + 775 Increase in maintenance and • Rebound from investment losses in • Decrease in nuclear power -50 Decrease in depreciation international businesses l

9. Slide 9: Ordinary Profit (by Segment)

   8 Ordinary Profit (by Segment) (100 million yen) Ordinary Profit FY2023 Consolidated Ordinary Profit by Segment FY2023 FY2022 Change Power Generation & Sales Transmission & Distribution Consolidated 800 (225) 1,025 IT/Communications Others [International business] Segment (Before Elimination of Inte

10. Slide 10: Changes in Consolidated Results

    9 Changes in Consolidated Results (100 million yen) (100 million yen) 1,200 9,000 8,332 1,100 7,874 Revenues* 1,000 8,000 7,331 7,192 Operating Profit 900 6,419 7,000 785 800 Ordinary Profit 800 700 6,000 Net profit attributable to 605 owners of parent 600 5,000 500 *The accounting standard for reve

11. Slide 11: Cash Flows

    10 Cash Flows *Plus is income, ( ) is expenditure (100 million yen) FY2023 FY2022 Change Cash Flows from Operating Activities 1,436 360 1,076 Ordinary Profit 800 (225) Depreciation 589 524 Others 46 61 Cash Flows from Investing Activities (973) (916) (57) Capital Expenditures (797) (746) Investments

12. Slide 12: Financial Position

    11 Financial Position (100 million yen) End of End of Change Main reasons for the increase or decrease FY2023 FY2022 Assets 16,290 16,120 170 ・Capital expenditures +572 Business assets 8,962 9,029 (67) ・Depreciation -589 Nuclear fuel 1,317 1,256 61 Investments, etc. 6,010 5,834 176 ・Increase in cash

13. Slide 13: Changes in Capital Structure

    12 Changes in Capital Structure (100 million yen) (%) 23.6% 25,000 22.8% 24.0 Accued Epenses, etc. 22.1% 23.0 Bonds and Loans 20.8% 22.0 * 21.0 Shareholders' Equity* 20,000 18.3% 20.0 Shareholders' Equity Ratio 19.0 *Shareholders Equity 16,290 18.0 16,120 = (Net Assets) ― (Minority interests) 15,007

14. Slide 14: Profit Allocation (Dividends)

    13 Profit Allocation (Dividends)  Paying stable dividends is our basic policy for returns to shareholders. We will first aim for the early realization of a 50 yen per share dividend, which is decided in the light of comprehensive consideration of business results, financial position, and medium-to

15. Slide 15: Forecasts of Consolidated Financial Results & Dividends for FY2024

    14 II. Forecasts of Consolidated Financial Results & Dividends for FY2024 Forecasts of Consolidated Electricity Sales Financial Results Forecast (100 million yen) (100 million kWh) < Reference > < Reference > FY2024 Forecast FY2024 Forecast FY2023 Results FY2023 Results Revenues 8,520 7,874 Retail 2

16. Slide 16: Forecast of Ordinary Profit for FY2024

    15 Forecast of Ordinary Profit for FY2024 (Factors Contributing to Change from FY2023 Results) (100 million yen) -320 FY2023 FY2024 Actual Forecast (Electric Power) -270 Decrease in Amount from Fuel Cost Increase in Total Adjustment System Electricity Supplied Decrease +40 -50 -480 impact of fuel De

17. Slide 17: Forecast of Ordinary Profit (by Segment)

    16 Forecast of Ordinary Profit (by Segment) (100 million yen) Revenues Ordinary Profit FY2024 Consolidated Ordinary Profit by Segment FY2024 FY2023 FY2024 FY2023 Change Change Forecast Results Forecast Results Power Generation & Sales Transmission & Distribution IT/Communications Others [Internation

18. Slide 18: Initiatives to Enhance Corporate Value

    Ⅲ ．Initiatives to Enhance Corporate Value 17

19. Slide 19: Medium-term Management Plan 2025: Partial Revision of Management Indexes

    (1) Medium-term Management Plan 2025: 18 Partial Revision of Management Indexes 〇Based on changes in the business environment such as an increase in total assets after the publication of the Medium- Term Management Plan 2025, among the management targets for FY2025, • The amount of ordinary profit e

20. Slide 20: Medium-term Management Plan 2025: Partial Revision of Segment Profit Targets

    (2) Medium-term Management Plan 2025: 19 Partial Revision of Segment Profit Targets 〇We have revised our profit target for the power generation & sales business to 15.0 billion yen for FY2025, because ordinary income equivalent to Approx. 3% of ROA would be more than 40.0 billion yen. *Long-term tar

21. Slide 21: Medium-term Management Plan 2025: Cumulative Cash Flow Allocation

    (3) Medium-term Management Plan 2025: 20 Cumulative Cash Flow Allocation Cash flow allocation (Ten-year total from FY2021 to FY2030) Capital policy Approximately 200 billion yen Results (Three-year total from FY2021 to FY2023) Strategic investment Approximately 200 billion yen Capital policy (divide

22. Slide 22: Initiatives to Enhance Corporate Value

    21 (4) Initiatives to Enhance Corporate Value 〇 We will first work to improve ROE and PER by firmly achieving the management targets set forth in the Medium-Term Management Plan 2025 (profit and cash flow indicators, realization of a 50 yen/share dividend, ensuring financial soundness, etc.) and imp

23. Slide 23: Major Initiatives for FY2024

    22 (5) Major Initiatives for FY2024 <Power generation business> Reducing carbon emissions from and decarbonizing <Transmission and Improvement power sources while maintaining stable power supply distribution businesses> in PBR Nuclear energy Renewable energy Thermal power ✓ Responding to the large-s

24. Slide 24: Capital Profitability (Changes in ROA and ROE)

    (Reference 1) 23 — Capital Profitability (Changes in ROA and ROE) — 〇Management has continued to experience low profitability due to the prolonged shutdown of the Ikata Unit No. 3 (nuclear power) following the Great East Japan Earthquake and intensified competition following the full liberalization

25. Slide 25: Evaluation from the Market: Changes in PBR and PER

    (Reference 2) 24 Evaluation from the Market — Changes in PBR and PER — 〇PBR (Price Book-value Ratio), has been below 1x due to the decline in profitability indicators, but changed to an upward trend in FY2023 as business management normalized combined with one-off factors as a lag in fuel cost adjus

26. Slide 26: Evaluation from the Market: Changes in Dividend Yield

    (Reference 3) 25 Evaluation from the Market — Changes in dividend Yield — 〇The change in dividend yield has been on an upward trend since FY2019 due to stock price slump caused by the suspension of the nuclear power plant due to the provisional disposition and deteriorating profitability, but for FY

27. Slide 27: Carbon Neutral Challenge 2050 (Update)

    Ⅳ. Carbon Neutral Challenge 2050 (Update) 26

28. Slide 28: Roadmap Update

    27 (1) Roadmap Update 〇The GX League's reduction targets (Scope 1 and 2 of GHG emissions) will be added to the roadmap toward carbon neutrality in 2050, along with the retail sector's reduction targets under the Act on Promotion of Global Warming Countermeasures, to promote initiatives to achieve th

29. Slide 29: Outlook for Achieving Reduction Targets for Power Generation and Retail Sales

    (2) Outlook for Achieving Reduction Targets for Power Generation and Retail 28 Sales Business 〇We have been reducing GHG associated with the use of fuels for our own power generation mainly through the stable operation of Ikata Unit No. 3 and expansion of renewable energy. We aim to increase the amo

30. Slide 30: Supplemental Data for FY2023

    29 Supplemental Data for FY2023 ➢ Segment Information • Results by Segment (Reference) Changes in Results by Segment • Plant and Equipment Expenditures ➢ Electric Power-Related • Electricity Sales • Electricity Supplied, Consumption of Fossil Fuels • Time Lag Effect of Fuel Cost Adjustment System •

31. Slide 31: Overview of Results by Segment: Power Generation & Sales

    30 1. Segment Information Overview of Financial Results by Segment: Power Generation & Sales [Revenues] 670.0 billion yen (Decrease) [Ratio of Sales to External Revenues decreased by ¥39.0 billion to ¥670.0 billion year on year, mainly due to a Customers] decrease in wholesale revenues due to a decr

32. Slide 32: Overview of Results by Segment: Transmission & Distribution

    31 Overview of Financial Results by Segment: Transmission & Distribution [Revenues] 240.0 billion yen (Decrease) [Ratio of Sales to External Customers] Revenues decreased by ¥26.2 billion year on year to ¥240.0 billion, mainly due to a decrease in revenues related to supply and demand adjustment des

33. Slide 33: Overview of Results by Segment: IT/Communications

    32 Overview of Financial Results by Segment: IT/Communications [Ratio of Sales to External [Revenues] 49.1 billion yen (Increase) Customers] Revenues increased by ¥3.6 billion year on year to ¥49.1 billion, mainly due to an increase in system development orders and FTTH revenues. [Ordinary Profit] 1

34. Slide 34: Overview of Results by Segment: Energy

    33 Overview of Financial Results by Segment: Energy [Ratio of Sales to External [Revenues] 25.8 billion yen (Increase) Customers] Revenues increased by ¥0.1 billion year on year to ¥25.8 billion. [Ordinary Profit] 6.7 billion yen (Increase) Ordinary profit increased by ¥21.8 billion year on year to

35. Slide 35: Overview of Results by Segment: Construction/Engineering

    34 Overview of Financial Results by Segment: Construction/Engineering [Revenues] 65.2 billion yen (Increase) [Ratio of Sales to External Customers] Revenues increased by ¥12.2 billion year on year to ¥65.2 billion, mainly due to an increase in orders for thermal power plant-related and biomass-relat

36. Slide 36: Overview of Results by Segment: Others

    35 Overview of Financial Results by Segment: Others [Ratio of Sales to External [Revenues] 35.5 billion yen (Increase) Customers] Revenues increased by ¥0.1 billion year on year to ¥35.5 billion. 27％ [Ordinary Profit] 2.4 billion yen (Increase) Ordinary profit increased by ¥0.3 billion year on year

37. Slide 37: Changes in Results by Segment

    36 (Reference) Changes in Results by Segment *All before the elimination of intercompany transactions Power Generation & Sales Transmission & Distribution IT/Communications Ordinary Profit Revenues Ordinary profit Revenues Ordinary Profit Revenues (100 million yen) (100 million yen) (100 million yen

38. Slide 38: Plant and Equipment Expenditures

    37 Plant and Equipment Expenditures (100 million yen) FY2023 FY2022 FY2022 Power Generation & Sales 338 483 (145) Renewable energy 48 30 18 Thermal 110 338 (228) Nuclear 59 38 21 Nuclear fuel 112 65 47 Transmission & Distribution 266 282 (16) Transmission 73 75 (2) Transformation 79 90 (11) Distribu

39. Slide 39: Electricity Sales

    38 2. Electric Power-Related Electricity Sales Electricity Sales (million kWh) FY2023 FY2022 Change Growth rate Major Factors Contributing to Changes Total retail sales 22,170 23,413 (1,243) (5.3)% • Decrease in industrial demand due to the impact of increased Lighting 7,491 7,686 (195) (2.5)% opera

40. Slide 40: Electricity Supplied, Consumption of Fossil Fuels

    39 Electricity Supplied, Consumption of Fossil Fuels Electricity Supplied (million kWh) FY2023 FY2022 Change Growth rate Details (5.7)% ・Nuclear Capacity Factor → 86.8% Own Generated Nuclear 6,510 6,903 (393) 92.4%(%) 19.7% ・Flow Rate 73.6% → 93.2% Power Hydro* 2,140 1,787 353 New Energy* 4 4 0 20.7

41. Slide 41: Time Lag Effect of Fuel Cost Adjustment System

    40 Time Lag Effect of Fuel Cost Adjustment System ○ Time Lag Effect of FY2023 is Approx. 28.5 billion yen. ※Monthly fuel prices are reflected in the fuel cost adjusted unit price with a 3-5 month delay. Time Lag Effect is the difference between Average Fuel Price applied to electricity charges as a

42. Slide 42: Retail Sales Power Share of PPS (Extra High, High Voltage: Shikoku Area)

    41 Retail Sales Power Share of PPS (Extra High,High Voltage：Shikoku Area) (%) 30 25 20 15 All over Japan 13.0 10 7.8 Shikoku Area 5 0 2021/1 4 7 10 2022/1 4 7 10 2023/1 4 7 10 2024/1 (y/m) （Source）Electricity and Gas Market Surveillance Commission “ Electricity transaction report ” All Rights Reserv

43. Slide 43: Retail Sales Power Share of PPS (Low Voltage: Shikoku Area)

    42 Retail Sales Power Share of PPS (Low Voltage：Shikoku Area) (%) 30 All over Japan 25 23.3 20 Shikoku Area 15 12.4 10 5 0 2021/1 4 7 10 2022/1 4 7 10 2023/1 4 7 10 2024/1 (y/m) （Source）Electricity and Gas Market Surveillance Commission “ Electricity transaction report ” All Rights Reserved © 2024 Y

44. Slide 44: Changes in the Number of Electrified Housing Contracts

    Changes in the Number of Electrified Housing Contracts (Cumulative：Shikoku Area) 43 Electric housing adoption ratio in new built houses:% 440 75.6 76.4 74.8 80 72.9 69.6 70 Number Number ofof electrified electrified housing housing contracts contracts 423 60 (Cumulative: (Cumulative: 1,000 1,000 hou

45. Slide 45: Changes in JEPX Spot Market Prices in Shikoku Area

    44 Changes in JEPX spot market prices in Shikoku area FY2022 average price FY2023 average price Shikoku area：19.10 yen/kWh Shikoku area：9.54 yen/kWh （West Japan area：18.77 yen/kWh） （West Japan area：9.85 yen/kWh） （yen/kWh） 40 35 30 Shikoku area average 19.10 yen/kWh 25 20 Shikoku area average 9.54 ye

46. Slide 46: Feed-in Tariff Scheme for Renewable Energy

    45 Feed-in Tariff Scheme for renewable energy : Cash flow Electricity customers Renewable Energy Power Generators ①Collection of surcharge ⑤Payment for the purchase of renewable energy （Other current liabilities） （Purchased power charge: ③＋④） Electricity retailers Obligated purchaser*¹ （Shikoku Elec

47. Slide 47: Time Series Data: Operating Profit, Ordinary Profit and Net Profit

    ３．Time Series Data 46 Operating Profit (Loss), Ordinary Profit (Loss) & Profit (Loss) Attributable to Owners of Parent All Rights Reserved © 2024 YONDEN Shikoku Electric Power Co., Inc.

48. Slide 48: Total Assets, Shareholders' Equity & Equity Ratio

    Total Assets , Shareholders’ Equity ＆ Shareholders’ Equity Ratio 47 All Rights Reserved © 2024 YONDEN Shikoku Electric Power Co., Inc.

49. Slide 49: Interest Bearing Debts & Interest Bearing Debt Ratio

    48 Interest Bearing Debts & Interest Bearing Debt Ratio All Rights Reserved © 2024 YONDEN Shikoku Electric Power Co., Inc.

50. Slide 50: Cash Flows

    49 Cash Flows 100 million yen 2,000 Cash flows from operating activities * Plus is income, ( ) is expenditure Cash flows from investing activities 1,436 1,500 Free cash flow 1,235 1,073 1,001 1,000 917 817 415 545 522 498 463 500 360 450 213 0 73 31 (371) (278) (500) (752) (551) (555) (603) (1,000)

51. Slide 51: Plant and Equipment Expenditures

    50 Plant and Equipment Expenditures All Rights Reserved © 2024 YONDEN Shikoku Electric Power Co., Inc.

52. Slide 52: Main ESG Data (Environment)

    51 Main ESG Data ① Item Unit FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 Excluding FIT free-of- charge distribution*1 10,000 tons- 1,297 1,024 1,372 1,312 1,170 CO2 emissions Including FIT free-of- CO2 charge distribution*2 1,230 914 1,252 1,186 1,041 CO2 emission factor (including FIT free-of-charge

53. Slide 53: Main ESG Data (Social and Governance)

    52 Main ESG Data ② Item Unit FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 Male 0.6 0.6 3.3 5.7 9.6 35.5 Ratio of employees % taking childcare leave Female 100.0 100.0 100.0 100.0 100.0 100.0 Male 16.3 15.8 15.9 16.5 17.2 18.7 Number of paid vacation Day(s) days *9 Female 15.8 14.7 15.8 15.9 16.1 18.5 S

54. Slide 54: Disclaimer

    Disclaimer This presentation contains business forecasts and other forward-looking statements. These statements are based on our assumptions and judgments in consideration of the information available at the time, and are therefore subject to risks and contain an element of uncertainty. It is also p

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