Tamron Co., Ltd.TSE: 7740

FY2024 Financial results briefing material

Feb 7, 2025 at 7:04 AM UTC · Issued by Tamron Co., Ltd.

FY2024 Financial Results

February 7, 2025

Tamron Co., Ltd. (Code: 7740)

Contents

Upward Revision of New medium-term management plan "Value Creation26 ver.2.0"
1. Positioning of the "Value Creation26 ver.2.0"
2. Outline of the "Value Creation26 ver.2.0"
3. Business Strategy of the "Value Creation26 ver.2.0"
4. Financial Strategy of the "Value Creation26 ver.2.0"
5. Management with a focus on capital costs and stock prices
6. ESG/Sustainability Strategy of the "Value Creation26"

FY2024 Financial Results
1. FY2024 Summary
2. FY2024 Financial Results
3. Factors Affecting Operating Profit Variability
4. FY2024 Results by Segment
5. 1. Photographic Products
  2. Surveillance & FA Lenses
  3. Mobility & Healthcare Products, Others

FY2025 Financial Forecast
1. FY2025 Financial Forecast
2. FY2025 Forecast by Segment
3. 1. Photographic Products
  2. Surveillance & FA Lenses
  3. Mobility & Healthcare Products, Others

IV. Reference Data

Financial Summary
Cash Flow
Capital Investment, Depreciation, and R&D Expenses
Quarterly Financial Results
Cash Dividends Outlook and Key Performance Indicators
Impact of Foreign Exchange Rate Fluctuations

Upward Revision of New medium-term management plan
"Value Creation26 ver.2.0"

I.-1. Positioning of the "Value Creation26 ver.2.0"

Launch of the new medium-term plan "Value Creation26"

Medium-term plan	Vision23	"Value Creation26 ver.2.0"
2018～2020	2021～2023	2024～2026

With the strong progress made since the first year of the new medium-term plan, we have evolved "Value Creation26" into "Value Creation26 ver.2.0"

		New
		Medium-term plan
		"Value Creation26 ver.2.0"
	Medium-term plan	2024～2026
	"Vision23"
Medium-term plan	2021～2023
2018～2020

Long-term vision

Aiming to become a company that is respected and truly needed

by society.

Aiming to "Net sales 100-billion-yen Company".

New Business Sales Target :

10 billion yen.

Improve Profitability of core business
Expand business in growing fields
Improvement of corporate constitution

Portfolio optimization
Development & growth of new

business

Establish a functional strategy
Development of human

resources & Activate the organization

Under Vision23's achievements,

we will overcome challenges, achieve high-quality leaps, and maximize corporate value through new endeavors.

～Basic policy～

Grow existing segments steadily and create new business
Create a workplace with a fulfilling environment and high corporate value

Sustainable Enhancement of Corporate Value

I.-2. Outline of the "Value Creation26 ver.2.0" ① Basic Framework

"Value Creation26 ver.2.0"

We will overcome challenges, achieve high-quality leaps, and maximize corporate value through new endeavors.

Reaching long-term vision "Net sales 100-billion-yen Company"

in the next Medium-Term Plan

Business Strategy	Financial Strategy
 Deepen the optimization of business portfolios	 Build an efficient and stable management structure
 Create and nurse new businesses	 Strengthen shareholder return policy

Building a Sustainable Business Structure

ESG/Strategy for Sustainability

Reform corporate governance structure
Enrich management infrastructure/human capital
Continue efforts toward carbon neutrality and reduce environmental impact

I.-2. Outline of the "Value Creation26 ver.2.0" ②Management Numerical Targets

『Value Creation26 ver.2.0』

Significant achievement of all targets in the first year of the

new medium-term plan ⇒	Significant upward revision of targets
Announced	Upward Revision
	in Feb. 2024	in Feb. 2025

	Actual	Target	Target ver.2.0
	2023	2026	2026
Net Sales	￥71.4B.	￥83.0B.	￥95.0B.
Operating	￥13.6B.	￥15.3B.	￥20.5B.
Income
(% Sales)	19.1%	18.4%	21.6%

	2021-2023	Target	Target ver.2.0
	Average	2026	2026
EBITDA	21％ level	More than	More than
(% Sales)	22％	24％

ROE	13％ level	More than	More than
14％	16％

Shareholder	Dividend	Total payout	Total payout
payout ratio	ratio	ratio
return policy	30％ level	Approx. 60％	Approx. 60％

※Exchange rate		USD/JPY:140	USD/JPY:145
assumption		EUR/JPY:152	EUR/JPY:155

Achieve growth in sales and profit while maintaining high profitability and efficiency.

FY2024 Results:

• Record high Net sales for the first time in 10 fiscal years, reached the 80-billion-yen level (near 90 billion yen)

• Record-high profits for the three consecutive years,

raised up to 25% compared to medium-term plan, Operating Income on Net Sales up to 20% level

FY2026 Targets:

Aiming to more than 1.3 times in Net sales and 1.5 times in Operating income compared to 2023.
Aiming to grow business toward Net sales of 100 billion yen and Operating income of over 20 billion yen.

Create a corporate value that significantly exceeds current financial value and business scale.

Initial Medium-term management plan announced in Feb. 2024:

Aim for our first Net sales of 80 billion yen and Operating income of 15 billion yen or more.

Net Sales (Billions of JPY)					95.0
Operating Income (Billions of JPY)		88.5	92.0
					83.0

							20.5
63.3			63.4	71.4	19.2	20.0
	57.5
					15.3
	48.4
			13.6
		11.0

7.0		7.4
	3.6
2019	2020	2021	2022	2023	2024	2025	2026	2026
							New	Initial
							Target	Target
							ver.2.0	2026

I.-3. Business Strategy of the "Value Creation26 ver.2.0" ① Functional Strategy

Business Strategy

Ensure continuous growth by allocating appropriate resources to each business

Advance the structure of the Photographic products business as a cash cow
Expand scale in both "Surveillance＆FA lenses", and "Mobility & Healthcare Products, Others" business.

Aiming to increase sales composition ratios of "Surveillance & FA lenses", and "Mobility and Healthcare, others" business by more than 15% each. (even though they are less than 15% each in 2026, Net Sales planned to increase by more than 1.5 times in 2026 compared to 2023)

Adjust the sales composition ratio of the Photographic products business from 3/4 to 2/3. (aiming to approx. 70% in 2026)

Functional Strategy

Evolution of each function to support growth in existing business growth and new business creation

Production・Procurement

Marketing・Sales

R&D・New Business Creation

Reinforce the global tri-pilar production system by starting the 2nd plant in Vietnam.
Increase the resilience of the supply chain, and enhance allocation flexibility
Promote automation・labor saving・ manpower reduction
Re-emphasizeindependent profitability and establish competitive advantage.

Recover sales in US & European markets.
Incorporate domestic demand in the Chinese market.
Capture demand in emerging markets.
Enhance digital marketing
Strengthen the ability to identify the needs on a global basis.

Advance fundamental optics and elemental technologies.
Improve productivity in product design and development
Enhance the discovery of the seeds/connection of needs.
Reinforce the function for new business creation
Accelerate open innovation design

I.-3. ① Functional Strategy - Reinforce the global tri-pilar production system

Start operation of Vietnam 2nd Factory

Expand production capacity
Strengthen risk response & stable supply system (risks: geopolitical risks, tariff risks, etc.)
Strengthen cost response capabilities

Name	Tamron Vietnam Vinh Phuc Factory
Place	Thang Long Industrial Park 3, Vinh Phuc Province, Vietnam
Investment	Approximately 4 billion yen (scheduled)
	Start of Construction: October 2023
Schedule	Start of Operation: January 2025
Establishment of mass-production system: 2026

	Full-capacity operation: 2028
	Land Area：Approx. 25,000㎡ Building Area：approx. 8,000㎡
Plant Scale	Total Floor Area：Approx. 28,500㎡
	（3 stories: Plant Building 17,000㎡、Motorcycle Parking 11,500㎡）

Early establishment of a manufacturing system that can respond to

long-term vision "Net sales 100 billion yen"

① Tamron Group's	② Production ratio
Current	2028
production capacity	（value basis）
	Vietnam	Approx. 25%	Approx. 45%
Increase by 1.2 times
	China	Approx. 65％	Approx. 45%
compared to current
		Japan	Approx. 10％	Approx. 10％

Parts procurement rate from China

Current Approx. 30％

↓

2025~: 20％ or below

- Vietnam 2nd Factory: Vinh Phuc Factory ＞
Lens Processing, Metal Processing, Molding, Coating, Assembling

Employees: Approx. 1,500 (at full-capacity operation)

Products: Photographic lenses, Surveillance lenses, Automotive lenses

- Existing Vietnam factory: Noi Bai Factory ＞
Lens Processing, Metal Processing, Molding, Assembling
Employees: Approx. 1,500
Products: Photographic lenses, Surveillance lenses

China・Foshan

Vietnam

	＜Aomori Factory＞
Aomori	 Lens processing, GM lens processing, Molding, Assembling
	 Employees: Approx. 300（include temporary employee）

Head Office	 Products: Photographic lenses, Surveillance lenses,
Medical application lenses, Test plates

＜China：Foshan Factory>

Lens Processing, Metal Processing, Molding, Coating, Assembling
Employees: Approx. 2,500 (include temporary employee)
Products: Photographic lenses, Surveillance lenses,

Automotive lenses, DSC/VC* lenses, Drone lenses *Digital Still Camera/ Video Camera

I.-3. Business Strategy of the "Value Creation 26 ver.2.0" ②Photographic Products

Inspire and enrich people's lives

Photographic Products
					Actual	Initial	New Target

Improve the high-profit structure as core business						2023	Target	ver.2.0
					2026	2026

 Accelerate the development of own-brand product	Net Sales	¥53.0B.	¥56.0B.	¥68.0B.
※Before 2023：5 models/per year				Own-brand	¥32.8B.	¥37.0B.	¥39.0B.
Initial Medium-Term Plan (Initial Target 2026):
			OEM	¥20.2B.	¥19.0B.	¥29.0B.
6～7 models/per year
New Medium-Term Plan (New Target ver.2.0 2026):	Operating Income	¥14.0B.	¥15.2B.	¥20.0B.
10 models/per year from 2026
 Continuously adapts to new formats	(% Sales)	26.4%	More than	More than
					27%	29%
New Medium-Term Plan (New Target ver.2.0 2026):					Net Sales (Billions of JPY)

establish and expand structure from 3 to 4 mounts
				Operating Income ratio More than 29%

Improving own-brand share
Recover sales in the US and Europe
Expand continuously in Chinese and Asian markets
Explore developing markets（Latin America, Middle East, Africa）

※Market Share by revenue: 5％ New Medium-Term

Plan: 7～8％

Strengthen the relationship with OEM business partners

26.4%		More than 27%
68.0
	56.0
53.0

2023	2026	2026
	New Target	Initial Target
	Ver.2.0

I.-3. Business Strategy of the "Value Creation 26 ver.2.0" ③Surveillance & FA Lenses

Create a secure and safe society

Surveillance & FA Lenses

Target

ver.2.0

Actual

Initial

New Target

Re-transform into a growth business, targeting for

2023

2026

more than 10% in operating income on net sales

Net Sales

¥9.8B.

¥14.5B.

¥13.0B.

 Shift to dual strategy

Surveillance

¥5.9B.

¥7.4B.

¥7.0B.

➡ Acquire more orders on volume zone products,

lenses

in addition to high-value-added products.

FA lenes,

¥1.6B.

¥3.6B.

¥2.8B.

 Develop customers in the FA market and other new

Others

business fields

Camera

¥0.8B.

¥3.5B.

¥3.2B.

➡ Expand FA lens's lineup, Increase OEM orders, and

module

sales of SWIR and Zoom, etc.

TV conference

¥1.5B.

➡ New Medium-Term Plan (New Target ver.2.0 2026):

lenses

Entry into new fields

Operating Income

¥0.7B.

¥1.6B.

・Market for Laser Processing head

More than

・Market for Thermal emitter with meta surface

(% Sales)

7.3%

11%

12%

・Market for Commercial camcorder

Net Sales（Billions of JPY）

 Expand the camera module's lineup

Operating Income ratio

than 12% More than 11%

➡ Achieve 4K・high magnification・miniaturization

➡ Expand sales in both OEM and own-brand

7.3%

14.5

➡ New Medium-Term Plan (New Target ver.2.0 2026):

13.0

Development of Thermal Zoom Camera Module

9.8

 Select and review the business structure

 Strengthen the development・production・sales structure

in China

2023

2026

New Target

Initial Target

Ver.2.0

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