Artience : Ink Business Briefing transcript

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Ink Business Briefing for the Year Ending December 31, 2025 Presentation (Transcript) Date/time: Feb.20,2026 11:10am - 11:50am (Japan time) Presenter: Hideki Yasuda President and Representative Director, TOYO INK CO., LTD. Katsuya Saso Director, General Manager of Marketing, TOYO INK CO., LTD. Masataka Namba Director, General Manager of Technology, TOYO INK CO., LTD. Presentation Material: https://ssl4.eir-parts.net/doc/4634/tdnet/2765527/00.pdf TRANSLATION: This is a transcript of the Ink Business for the Fiscal Year Ending December 2025, held on Feb. 20, 2026. This is an English translation of the Japanese original, prepared only for the convenience of shareholders residing outside Japan. The original Japanese version will prevail should there be any difference in the meaning between the English version and the Japanese version. DISCLAIMER: The forecast or projections in this material are based on the assumptions and beliefs of our management considering the information available as of Feb. 20, 2026. Changes in global, economic, and business conditions could cause actual results to differ materially from these forecasts. The content of this transcript has been edited or revised by the company. Yasuda : First, an overview of our ink business. As discussed earlier in the FY2025 results briefing, this is a fundamental business that supports the Group's earnings, accounting for about 50% of both net sales and operating profit. Looking globally, we recognize that the ink market continues to present a significant room for growth. Today, I would like to introduce our strategy for the further growth stage of our ink business and an example of the new business initiatives we are pursuing as part of that strategy. Today, we would like to discuss in turn what is described in this agenda. TOYO INK is primarily responsible for the packaging segment and the printing and information segment. First, the packaging segment offers inks used in food packaging, refill containers for daily necessities, cardboard boxes, paper bags, and other packaging materials that consumers see in their daily lives. Our main products are gravure inks and flexographic inks, which we refer to collectively as liquid inks. Next is the printing and information segment, which focuses on offset ink used for books, newspapers, flyers, and other products. In recent years, we have been shifting our business portfolio toward UV curable inks and other functional inks. The product groups shown in red on the slide are areas where further growth is expected and where we are particularly focusing our efforts. I will continue with an explanation of the growth prospects for the global packaging inks market. First, look at the left side. Between 2022 and 2030, the population is expected to grow significantly, especially in India, the Middle East, and Africa. Looking at GDP growth rates, India is expected to grow at 6.8%, China at 4.5%, and ASEAN at 4.3%, indicating that economic growth in these regions will continue to be high. We believe that the growth of the population, combined with economic growth, will lead to increased consumption, which in turn will lead to increased demand for food and daily necessities, which in turn will lead to increased demand for packaging. Next, I would like to talk about the size of market for packaging inks. The domestic market is about 120,000 tons for flexible packaging applications, or food packaging, and about 27,000 tons for paper packaging, forming a stable market supported by demand centered on daily necessities. On the other hand, if we look at the global market, we see a clearer growth trend. Against a backdrop of population growth, economic growth, and increasing consumption, continuous expansion is expected for both flexible packaging applications, from JPY1.13 million tons in 2021 to JPY1.4 million tons in 2030, and for paper packaging, from 180,000 tons to 220,000 tons. While maintaining a stable domestic foundation, we will focus on allocating management resources to growth markets to achieve sustainable business expansion. So why are we able to continue to compete in such a growing market? The source of our success lies in our technological capabilities. The Group has three essential technologies for inks at its core operating companies. The first is polymer resin synthesis technology, which is the most important fundamental technology that determines ink performance. We design and develop this technology in-house to meet the needs and applications of our customers and then manufacture it in an integrated manner. Second, we possess technologies related to pigments and colorants, which are coloring agents. And third is the technology for dispersing and blending these pigments and resins. We maximize the potential of pigments and resins and combine them in an optimal balance to differentiate their performance as final products. We also possess technologies in peripheral areas, such as manufacturing and sales technologies and laminating adhesives, for which we have the largest market share in Japan. Overall, we believe our greatest strength is our ability to provide total solutions for the entire package. Let me begin by discussing our growth strategy for liquid ink. We boast the number one market share in Japan for gravure inks and laminating adhesives for packaging. Food packaging requires extremely high-quality standards, including safety and environmental friendliness, as well as high physical properties that can withstand severe usage environments, such as microwave and retort suitability. We believe that our high market reputation for both inks and adhesives represent our comprehensive strength in the packaging field and means that we are the most trusted in the industry in terms of quality. We have been quick to market products that contribute to reducing environmental impact, such as biomass inks that use plant-derived raw materials and water-based inks that do not use organic solvents. Sustainability has become an important management issue for our customers as well, and we believe that our initiative-taking efforts to address environmental issues as a growth opportunity have been a major factor in building our current market position. Up to now, we have steadily expanded our business, leveraging Japanese technical capabilities, in Asian markets where gravure printing and urethane inks are the mainstream. Our strategy for the future is to further solidify and expand our business base in the Asian market, which has been our strength. In addition, we aim to utilize our new plant in Turkey-established as a strategic base-to significantly develop our liquid ink business in Europe, the US, and EMEA regions, where flexographic printing and NC inks are the mainstream. I would like to introduce which regions we are focusing our investments on to expand our liquid ink business. First is India. It has the fastest population growth in the world and a high GDP growth rate of 6.8%. With the expansion of the middle-income class, the demand for packaging is expected to explode in the future. We have positioned this market as one of the most important growth markets for our company. Next is China. The market is already one of the largest in the world, but it still has growth potential. We will strive to further expand our market share by restructuring the cooperative system among our bases and fortifying our sales force and technical support system. We also built a new plant in Turkey as a strategic base for the EMEA region. Using this as a hub, we will accelerate our expansion into the European, Middle Eastern, and African markets. Furthermore, Southeast Asia, especially ASEAN, is also a priority region. We are actively developing our business bases in various countries and reinforcing our business foundation in anticipation of future demand expansion. In terms of domestic strategy, the Japanese market is at a mature stage, and we will further improve profitability by promoting smart factories and increasing production efficiency. Thus, we aim to achieve 30% growth in global operating profit in the package segment by FY2030 through a combination of aggressive investments in growth markets and boosting efficiency and profitability in mature markets. Next, I will discuss our growth strategy for UV curable inks. First, a brief explanation of UV curable inks. Compared to oil-based inks conventionally used in offset printing, UV curable inks have three major advantages. The first is instantaneous curing. While oil-based inks require a certain amount of time to dry, UV curable inks cure instantly when exposed to ultraviolet or UV light. This improves productivity and enables a smooth transition to the post-press process. Second is the perspective of environmental considerations. Since UV curable inks do not involve the volatilization of organic solvents, they can contribute to improving the work environment and reducing environmental impact, which is a great advantage in today's world, where sustainability is a priority. Third is durability. The ink film formed by the UV effect is extraordinarily strong and has excellent rub resistance and chemical resistance. In addition to paper, modern technology can be applied to a wide range of base materials, including plastics, and is expected to expand the range of applications. Thus, UV curable inks are high-value-added products that combine productivity, environmental compatibility, and functionality, and we are actively working on them as one of our growth areas. UV curable inks are used in a wide variety of applications. We have designated four markets in which we are particularly focused and are developing them strategically. First is the commercial printing and information publishing sectors. Although the market itself is shrinking due to the progress of digitalization, a certain level of demand will continue in the future. The Company will maintain its business while ensuring profitability by building an efficient production system. On the other hand, our greatest focus is on paper packaging, cards, stickers/labels, and plastic cup applications. Since these sectors are tied to daily necessities, they are stable markets that are less susceptible to economic fluctuations. Notably, the characteristics of UV curable inks provide an advantage in the face of increasing demands for safety and environmental friendliness. In addition, the card market is also attracting attention as an area where further growth is expected in the future. Next, as to the outlook for the global UV curable inks market, this is expected to grow steadily from about 120,000 tons in 2021 to 150,000 tons in 2030. By region, Europe and North America form the largest markets, followed by China. In the domestic market, UV has been introduced early on, and progress has been made in introducing UV to high-value-added applications. Meanwhile, the overseas market is also expected to expand further in the future, backed by the characteristics of UV curable inks as discussed earlier. I will now discuss the trends in the UV printing market. Recently, printing companies have been accelerating their efforts to become more environmentally conscious, and two points are particularly noteworthy. The first is the introduction of energy-saving printing equipment. Conventional UV curing required high-power lamps, but LED lamps have recently become popular, enabling instant curing even at low power, contributing to a significant reduction in power consumption and CO2 emissions. The second is the use of environmentally friendly materials. The use of FSC-certified paper, i.e., paper produced from sustainable forest management, and biomass inks that utilize plant-derived raw materials are gaining momentum. The adoption of such materials is accelerating the trend towards reducing the environmental impact of printed materials. Considering these printing market trends and customer needs, our new value-added product is biomass ink for LED lamps. We were the first in the industry to introduce LED-compliant UV curable inks to the market, and we have abundant knowledge regarding the use of LEDs. Furthermore, we boast the industry's number one lineup of biomass UV curable inks containing plant-derived raw materials, offering products with a high degree of environmental contribution to the market, and differentiating them from competitors' products. So, what makes this possible for us? This is because we develop and produce our own key materials in-house. While other companies purchase materials from outside suppliers, we design and manufacture our own pigments and other key materials in-house, which allows us to differentiate ourselves in terms of quality in a way that other companies cannot. By leveraging this strength, we will continue to demonstrate leadership in the environmentally friendly UV curable inks market and drive sustainable growth. The artience Group currently holds a dominant position in the global LED UV market. Especially in Europe, North America, and Japan, our competitiveness is outstanding, and many of our customers have adopted our products. We will leverage this solid foundation to achieve further growth. In addition to the spread of power-saving UV curable inks, we plan to aggressively cultivate the market by introducing innovative new products into the sticker and label fields, which are expected to grow. We aim to achieve 60% growth in operating profit from UV curable inks products worldwide by FY2030. Now, I would like to talk about what kind of social issues we are helping to solve. First, I would like to continue discussing our future initiatives. Packaging materials, such as food packages, are multiple plastic films bonded together by adhesives. It is technically exceedingly difficult to peel off these laminated films again and remove the ink sandwiched between the films, and this has been a major challenge in achieving recycling. To address this issue, we have developed new inks and adhesives that facilitate recycling. Based on this technology, we have also developed a revolutionary process technology in collaboration with excellent partners such as Aikawa Iron Works and Hagiwara Kogyo. The combination of these technological innovations has made it possible to efficiently extract transparent, high-purity recycled plastic from composite films, which has been difficult in the past. As an example of our achievements, we have commercialized recyclable refill pouches in collaboration with Lion. We are convinced that our technology to recycle packaging materials that were previously discarded as resources will contribute to effective use of resources and reduce waste and is a truly innovative step toward building a sustainable society. As efforts to achieve recycling are accelerating around the world, regulations tend to be tightened. We see this trend of stricter regulations as a tailwind and business opportunity and will continue to develop material processes that enable the implementation of recycling as a driver of sustainable business growth. Finally, I would like to share with you an example of our new business initiatives. We are applying the precise control technology for color and light that we have cultivated in our printing ink business to completely new markets. The first is technology that enables clearer and more beautiful images by minimizing the diffuse reflection of light. It is installed in smartphones and SLR cameras. The other is infrared transmission technology that enables high-precision sensor functions. This technology is used, for example, in facial recognition systems for smartphones and smart door locks. It has the unique property of allowing infrared light itself to pass through, while blinding infrared cameras and sensors. This allows for both greater design freedom and advanced clinical functionality. We aim to create new solutions that meet the needs of the times and turn them into a new engine for profit growth. Finally, I would like to discuss one more aspect of new business development. Printed electronics technology, which is based on our core strengths in conductive material design technology and electrode circuit formation technology, can be applied to a variety of sensing applications. We would like to introduce a high-precision water level sensor that is currently undergoing demonstration tests in rice paddies. This sensor is insensitive to external environmental influences and provides precise water level measurements in centimeter increments. There are two major benefits of this technology. The first is to increase agricultural productivity. Highly accurate water level management allows for optimal rice growth while effectively suppressing the activities of pests such as pond snails. It prevents feeding damage to rice plants and reduces the amount of pesticides and chemicals used. The second is to contribute to the environment and create new profit opportunities. It has been scientifically proven that by managing the water level by repeatedly flooding and draining, the amount of methane gas produced can be significantly reduced without losing rice yield. This methane gas reduction effect can be used as evidence in the J-Credit system. Accurate water level data acquired by water level sensors will visualize this environmental value. The credits are expected to be sold to companies and municipalities seeking to contribute to the environment. I would like to express my gratitude for taking the time out of your busy schedule to participate in this briefing. We believe that you have gained a better understanding of our current business performance and prospects. As a leading company, we will continue to take on the challenge of providing value to the market that exceeds expectations. And as the culmination of our efforts, we have set an ambitious goal of growing operating profit in the ink business by 50% globally by 2030, including inorganic growth. In addition to strengthening existing businesses, such as liquid inks for packaging and UV curable inks, which I discussed today, we intend to achieve this goal by creating new businesses that leverage the technology we have cultivated in the ink business. That is all from me. Thank you. 【END】

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