Towa Pharmaceutical : FY2025 Briefing Script and Q&A Summary of financial results meeting(581K／27P)

[Outline]

Date and time: May 18, 2026 (Monday), 1:00-2:00 pm Speakers: Itsuro Yoshida, President

Osamu Uchikawa, Executive Managing Director

Toshikazu Kokubun, Director Masaaki Takeyasu, Director

Hideshi Nakamura, Operating Officer,

Division Manager, Corporate Strategy Division Shiro Hatagami, Operating Officer,

Division Manager, Finance & Accounting Division Masaji Morikawa, Operating Officer,

Division Manager, Sales and Marketing Division Hirokazu Kisaka, Operating Officer,

Division Manager, Production Division

[Briefing Script]

*Slides that are not explained, such as the table of contents and reference materials, have been

omitted.

Thank you very much for taking the time to join us today.

This is Kokubun from Towa Pharmaceutical.

I would like to explain our financial results based on the "Supplementary material for the financial results for the year ended March 31, 2026." Thank you for your attention.

Notes to financial results disclosure material

Notes

In this document, for the breakdown of the domestic segment,

Towa Pharmaceutical, J-Dolph Pharmaceutical, Daichi Kasei, Greencaps Pharmaceutical, and Kyushu Iyaku are referred to

On April 1, 2025, the Company carried out an absorption-type merger with Sunsho Pharmaceutical as the surviving company and KAMATA as the disappearing company.

On May 11, we announced recognition of an impairment loss and a revision to our full-year earnings forecast for the fiscal year ended March 31, 2026.

Towa Pharmaceutical

J-Dolph Pharmaceutical

Daichi Kasei

Greencaps Pharmaceutical

Kyushu Iyaku

Sunsho Pharmaceutical

Towa Pharma International Holdings

Sun Freres Lab.

Towa Pharma Europe

Breckenridge Pharmaceutical

Towa Pharmaceutical

2026

1

Now, please have a look at slide 1.

Before I begin, I would like to explain the notation we use in the financial results disclosure for the third quarter.

In this document, for the breakdown of the domestic segment, Towa Pharmaceutical, J-Dolph Pharmaceutical, Daichi Kasei, Greencaps Pharmaceutical, and Kyushu Iyaku are referred to as

Sunsho Pharmaceutical and Sun Freres Lab. are referred to as

Sunsho

On April 1, 2025, the Company carried out an absorption-type merger with Sunsho Pharmaceutical as the surviving company and KAMATA as the disappearing company.

Towa Pharma International Holdings, S.L. and its subsidiaries, which constitute our overseas

On May 11, we announced recognition of an impairment loss and a revision to our full-year earnings forecast for the fiscal year ended March 31, 2026.

2026

Consolidated financial results for 2026/3

YoY change: Net sales increased, but operating profit decreased.

Progress rate for the plan: Net sales: 97.8%, Operating profit: 85.6%.

Ordinary profit increased due to the posting of a 5.3 billion yen gain on valuation of derivatives.

(In 25/3, a 1.2 billion yen gain on valuation of derivatives was recognized.)

Profit deceased due to the posting of an impairment loss of 14.7 billion yen on goodwill of Sunsho Pharmaceutical.

4

Now, please turn to slide 4.

I would like to explain the consolidated financial results for the fiscal year ended March 2026.

Consolidated net sales increased to approximately 273.7 billion yen, but fell short of the full-year plan target.

Consolidated operating profit decreased to approximately 23.1 billion yen and also fell short of the full-year plan target.

Consolidated ordinary profit increased due to the posting of a 5.3 billion yen gain on valuation of derivatives, exceeding the full-year plan target.

Consolidated profit decreased due to the posting of an impairment loss of 14.7 billion yen on goodwill of Sunsho Pharmaceutical and also fell short of the full-year plan target.

5

2026

Pharmaceutical, etc. Pharmaceutical, etc.

26/3

Adjustment

Towa INT

Sunsho

Towa

25/3

23.24

1.06

- 0.14

(JPY billion)

Factors behind changes in operating profit for 2026/3

232.4

10.6

-11.8

0.1

-0.3

231.0

Please turn to slide 5.

I would like to explain the factors behind the changes in consolidated operating profit.

Although gross profit increased at Towa Pharmaceutical, etc. due to an increase in sales volume and unit price, consolidated operating profit decreased by approximately 140 million yen compared to the previous fiscal year due to an increase in the cost of sales ratio at Sunsho Pharmaceutical, etc., which led to a decrease in gross profit.

2026

Outline of financial results for 2026/3 (Consolidated)

YoY change:

Net sales increased due to an increase in sales volume and unit prices at Towa

Pharmaceutical, etc. and sales growth in Europe for both BtoB and BtoC at Towa INT.

Operating profit decreased because a rise in the cost of sales ratio caused by a worsening business mix at Sunsho Pharmaceutical, etc. could not be sufficiently offset.

Progress rate for the plan: Both net sales and operating profit fell short of the plan due to a lower-than-expected increase in sales after the lifting of regulated shipments at Towa Pharmaceutical, etc. and a decline in the new application business at Sunsho Pharmaceutical, etc.

(JPY million, %)

6

Now please turn to slide 6.

I would like to explain the consolidated financial results summary for the fiscal year.

Consolidated net sales increased 5.4% year on year due to an increase in sales volume and unit prices at Towa Pharmaceutical, etc. and sales growth in Europe for both BtoB and BtoC at Towa INT.

Consolidated operating profit decreased 0.6% year on year because a rise in the cost of sales ratio caused by a worsening business mix at Sunsho Pharmaceutical, etc. could not be

sufficiently offset.

Compared to the full-year plan, both net sales and operating profit fell short of the plan due to a lower-than-expected increase in sales after the lifting of regulated shipments at Towa Pharmaceutical, etc. and a decline in the new application business at Sunsho Pharmaceutical, etc.