Basic Policy on Distribution of Profits

Amid a business environment that is rapidly changing and intensifying, Fuji Seal International has sought to raise corporate value by achieving sustained growth. The Company considers the following to be its most important management challenges: 1) returning profits to shareholders based on Company performance and 2) continuing to increase shareholder returns in a sustained manner.

As such, the Company's view on profit allocation is as follows.

• Invest in continued growth (technology development, human resource development, capital expenditures, M&A)
• Increase the dividend per share in a stable and sustained manner
• Target a consolidated dividend payout ratio of 20%
• Build a stable financial base prepared for emergencies and acquire and dispose of treasury stock (increase capital efficiency)

In the fiscal year ended March 31, 2020, net income increased year on year, despite the Group facing a very uncertain business climate accompanying the COVID-19 outbreak.
In consideration of the business performance for the fiscal year ended March 31, 2020, the Company plans to pay a year-end dividend of ¥16 per share.
The Group will thus pay an annual dividend of ¥32 per share for the fiscal year ended March 31, 2020, which includes the already paid interim dividend (¥16 per share), for a consolidated dividend payout ratio of 20.6%. The dividend is to be formally resolved at the Board of Directors meeting on full-year business results scheduled to be held on May 20, 2020.
TIn the fiscal year ending March 31, 2021, in spite of operating under a harsh business environment, the Group plans to pay an annual dividend of ¥32 per share, the same as the previous fiscal year, based on the aforementioned basic policies. As a result, the Group expects to achieve a consolidated dividend payout ratio of 22.2% for the fiscal year ending March 31, 2021.