#1gremz Energy Solutions Company Company / Financial Results Presentation gremz, Inc. http://www.gremz.co.jp/ JPX LISTED TSE 1st Section Ticker 3150 Dec. 2021#2gremz 1. Company Profile 2. Business Overview 3. Overview of FY03/2021 4. Overview of 2Q FY03/2022 Energy Solutions Company 5. Financial Results and Dividend Forecast for FY03/2022 6. Sustainability 2 Copyright gremz, Inc All Rights Reserved#3gremz 1. Company Profile Energy Solutions Company 3 Copyright gremz, Inc All Rights Reserved#4Company Profile (As of Sep. 30, 2021) Company Name gremz, Inc. Representatives TSE First Section (Ticker: 3150) President Chief Executive Officer Masaomi Tanaka Executive Vice President Chief Operating Officer Shinichi Nasu Founded on July 4, 2005 Capital Shares Outstanding 640,874,100 Yen 23,490,800 shares End of Fiscal Year March 31 Employees (Consolidated) Headquarters Consolidated Subsidiaries 340 (ECS 138, SHP 92, ER 40, Administrative 70) Tennoz First Tower 19F, 2-2-4 Higashi-Shinagawa, Shinagawa-ku Tokyo, 140-0002, Japan GR consulting, Inc. gremz power, Inc. gremz solar, Inc. gremz 4 Copyright gremz, Inc All Rights Reserved#52005 July 2007 Group History gremz The company was founded with a view towards a reduction of energy costs as well as Human impact on the Environment. Started the sale of Electronic Circuit Breakers. July Started the sale of two fully-electric appliances. (EcoCute and Induction Heating Cooking Heater) 2009 March Listed on the JASDAQ Securities Exchange. (Later renamed to TSE JASDAQ Standard) (Ticker: 3150) 2010 Renamed the company gremz, Inc. and established it as a Holding Company. 2011 April 2012 Dec. Carried out a comprehensive tie-up with ENERES Co., Ltd. 2013 Dec. 2014 2015 2016 2018 April Entered the Solar Energy Market. Founded gremz solar, Inc. and GR consulting, Inc. Founded GF lightec, Inc. Began the sale of LED Illumination systems. Entered the market for energy intermediation and began the sale of energy management systems. Sept. Announced a capital tie-up with ENERES Co., Ltd. May gremz solar, Inc. began the operation of a solar power plant in Tsumagoi. April Renamed GF lightec, Inc. to gremz power as a result of business reorganization. Separated the segments of Energy Intermediation and Energy Management Systems from the remit of GR consulting, Inc. May gremz solar, Inc. began the operation of a solar power plant in Futokoroyama. Dec. May Started providing Electricity Retailing services for clients with low-voltage requirements. Started providing Electricity Retailing services for clients with high-voltage requirements. Participated in an Environmental Technology Verification program centered around VPP (Virtual Power Plant) technology, as a resource aggregator. June Changed Stock Market Listing to the Second Section of the Tokyo Stock Exchange. 2020 Nov. Ascended to the First Section of the Tokyo Stock Exchange. 5 Copyright gremz, Inc All Rights Reserved#6gremz 2. Business Overview Energy Solutions Company 6 Copyright gremz, Inc All Rights Reserved#7Business Segments - Overview gremz Business segments are divided by target demographic (business clients or retail consumers), and by sales category (products or electricity) Energy Cost Solutions Business GR consulting Sale of electronic circuit breakers, LED illumination and energy-efficient appliances geared toward business clients #Power Energy intermediation for clients with high-voltage requirements (6,600V); sale of energy management systems, LED illumination and energy-efficient appliances Smart House Project Business gremz SOLAR Sale of photo-voltaic systems, storage batteries, and fully-electric appliances to retail consumers; Generation of renewable energy Electricity Retailing Business gremz Power Electricity retailing services for clients with low-voltage requirements (200V; 100V) and for clients with high-voltage requirements (6,600V) 7 Copyright gremz, Inc All Rights Reserved#8gremz Group's Products and Services gremz We offer solutions for clients with low and high-voltage requirements, allowing them to improve operational efficiency, improve facilities, and lower the procurement cost of electricity Energy Solutions provided by the gremz Group Market segment & scale Improve Operational Efficiency Energy Cost Solutions Business Improve Facilities Lower Procurement Cost Energy Intermediation Business Area High-voltage Electricity (6,600V~) 10 trillion yen market Low-voltage Electricity (200V) 7.5 trillion yen market loT Devices EMS (1) (1) Energy Management System Electronic Circuit Breakers (Replacement Sales) Smart House Project Business LED Illumination Commercial A/C Units Energy-efficient Appliances Photo-voltaic Systems Electricity Retailing Business Electricity Retailing LED Illumination Commercial A/C Units Energy-efficient Appliances Photo-voltaic Systems Electricity Retailing Low-voltage Electric Lights (100V) 80 Photo-voltaic Systems Storage Batteries Fully-Electric Appliances Home Renovation Products ⚫ Electricity Retailing Copyright gremz, Inc All Rights Reserved#9gremz Energy Cost Solutions Business - Overview 9 Energy Solutions Company Copyright gremz, Inc All Rights Reserved#10gremz We offer total solutions allowing clients to improve operational efficiency, improve facilities, and lower the procurement cost of electricity Products and services in the Energy Cost Solutions Business Improve Operational Efficiency Allows clients to lower their base electricity fee by reviewing their electricity use and contract details. loT Devices Remotely monitor electricity consumption via IOT sensors Improve Facilities Allows clients to lower electricity usage fees by migrating existing facilities into facilities with better energy- saving effects. ⚫ LED Illumination Lower electricity consumption; product lifespan approximately 4x that of fluorescent lamps Lower Procurement Cost By reviewing their procurement source of electricity, this allows our clients to lower their procurement cost. • Energy Intermediation Offer energy intermediation services from several power producers and suppliers for optimal procurement ゴルフスキ ビル・マンション。 老人ホーム RRM サービス スターターキット |LoRa親機 KE スーパーホームセンター ⚫ Electronic Circuit Breakers Coupled with a contract review, the introduction of ECBs makes possible the stable operation of machinery equipment and allows clients to lower the cost of electricity • ⚫ Photo-voltaic systems for commercial self-consumption Reduce electricity costs by installing photo-voltaic systems on factory roofs, etc., and consuming the electricity generated # 電力 gremz Power • Commercial A/C units • Transformers • Energy-saving appliances 10 Copyright gremz, Inc All Rights Reserved#11gremz Through the introduction of electronic circuit breakers and through our consulting services, clients with low-voltage requirements can lower their base electricity fee. We offer adequate consulting to guide clients with low-voltage requirements in reviewing their contract power. The introduction of electronic circuit breakers allows our clients to continue the operation of heavy machinery at their factories, etc, in a stable manner, while simultaneously reducing the cost of low- voltage electricity Contract details for a low-voltage (200V) contract Contract capacity is used to determine the base electricity fee for low-voltage clients. Contract capacity is determined in the client's contract with the energy company. N-EB 及投店 トーション -11-26Texas 15A JET Base Electricity Fee Electricity Fee (Low-voltage) Base Electricity Fee (1,046 yen) Contract Capacity +[ Details for a low-voltage contract (Determining contract capacity) Load Facility Contract Contract capacity is the sum of the motor capacity for the entire facility. A base electricity fee is charged even when the facility equipment is not in use. Usage Fee 2 Main Switching Contract Contract capacity is determined by the capacity of the main circuit breaker measured in A: amperes. Possible to determine contract capacity according to usage. 11 Copyright gremz, Inc All Rights Reserved#12gremz Acquire new customers via the sale of products to improve operational efficiency, and strengthen cross-selling (Unit: JPY MM) (Unit: JPY MM) Net Sales Trends by Product/Service 4,000 6,000 Gross Margin on Sales Trends by Product/Service 5,475 142 3,588 3,500 142 5,000 3,129 4,407 4,450 202 208 4,000 4,565 114 3,000 2,826 114 202 2,500 2,577 208 1,710 3,310 1,508 2,693 3,000 2,402 2,948 2,000 1,140 1,305 2,000 1,500 1,000 1,731 1,476 1,507 1,000 1,995 1,771 1,743 500 1,056 1,265 О FY 03/2019 (Realized) FY 03/2020 (Realized) FY 03/2021 (Realized) ■Operational Efficiency Facility Efficiency Products Products Products FY 03/2022 (Projected) Procurement Efficiency 12 FY 03/2019 (Realized) FY 03/2020 (Realized) FY 03/2021 (Realized) FY 03/2022 (Projected) Facility Efficiency Procurement Efficiency Products ■Operational Efficiency Products Products Copyright gremz, Inc All Rights Reserved#13gremz Electricity Retailing Business - Overview 13 Energy Solutions Company Copyright gremz, Inc All Rights Reserved#14Electricity Retailing Business Business Differentiation gremz Cross-selling to our customer base of ≈ 52,000, primarily to our electronic circuit breaker clients # of Customers x (Low-Voltage Power + Meter Rate Lighting) = 104,000 contracts 78% of our customers migrate to gremz power, Inc. from other energy companies Realized Average Monthly Cancellation Rate of 0.4% Adaptability to Changes in the Price of Electricity Continue supplying customers with a low Load Factor (*) (9.5% realized in FY 03/2021) Customers with low Load Factors →> · Electricity consumption doesn't grow significantly → Base electricity fees represent a high share of electricity sales → Limited impact of fluctuations in the market price of electricity Lower price fluctuation risk ratio to 30% (FY 03/2021 data -60% in winter, 70% for the rest of the year) *Load Factor: Yearly Electricity Use (kWh) (Contract Power (kW) X 24 hours X 365 days) X 100 14 Copyright gremz, Inc All Rights Reserved#15gremz Electricity Retailing Business (#) We expect to supply power to approximately 53,500 contracts by the end of FY 03/2022 The number of contracts stood at 47,118, as of the end of September 2021 Contract Base (Aggregate) and Results 47,118 4,000 49,500 53,498 44,428 50,366 42,203 40,176 46,921 38,365 43,801 3,223 35,947 34,136 2,807 3,000 32,474 30,869 28,137 2,332 2,409 2,214 2,068 1,897 1,804 1,804 24,500 1,438 2,000 3,226 2,750 2,723 2,144 1,000 571 630 552 528 580 418 348 374 368 503 590 452 482 -500 -25,500 -1,747 -1,000 -2,000 1Q FY 03/2020 2Q FY 03/2020 3Q FY 03/2020 4Q FY 03/2020 1Q FY 03/2021 2Q FY 03/2021 3Q FY 03/2021 4Q FY 03/2021 1Q FY 03/2022 2Q FY 03/2022 3Q FY 03/2022 4Q FY 03/2022 (Realized) (Realized) (Realized) (Realized) Gross Margin on Sales (Projected) Net Sales (Realized) (Realized) (Realized) (Realized) Net Sales (Projected) Contract Base (Realized) 15 (Realized) (Projected / Realized) (Projected / (Projected) Realized) (Projected) Gross Margin on Sales (Realized) Contract Base (Projected) Copyright gremz, Inc All Rights Reserved#16gremz Smart House Project Business - Overview 16 Energy Solutions Company Copyright gremz, Inc All Rights Reserved#17Sales strategy involving sales at special events, tie-up sales • Consumers can see photo-voltaic systems and storage batteries for themselves, and hear a detailed explanation from gremz solar, Inc. staff at event areas in shopping centers all over the country. Staff then visits the homes of prospective. buyers, and provides an estimate of the amount. of power that can be generated. Held in large-scale commercial facilities →strengthen ability to attract customers Held in 240 locations all over Japan Held 3,000 times annually 停電時专 使える CEUTT SAMURAI gremz SAMURAI シミュレーション • In addition to the Tokyo Headquarters, gremz solar, Inc. also has sales offices in Nagoya, Osaka and Fukuoka. Housing Manufacturers • Tie-up Sales Enter business partnerships with housing manufacturers and others, and sell photo-voltaic systems and storage batteries to prospective buyers from among our partners' long-time customer base. -5-FC gremz solar, Inc. Inventory Purchase 17 Long-time customer Sales Activities base, etc. L Business partnerships Photo-voltaic systems and storage battery manufacturers company Related Housing manufacturers - related companies Copyright gremz, Inc All Rights Reserved#18- gremz Adoption of Residential Storage Battery Systems Outlook - Total Adoption (# units) for New / Existing Homes - Adoption of residential storage battery systems for new/existing homes stood at a total of 110,000 units/year in 2019. This market is expected to expand to 260,000 units/year in 2025 (cumulative: 1.58 million), and to 350,000 units/year in 2030 (cumulative: 3.14 million), excluding replacement sales. The forecast was raised by approximately 20,000 units, from 330,000 in the second METI forecast. Adoption of Storage Battery Systems as a share of PV adoption (both on a cumulative basis) is projected at approximately 44% in 2025 and 77% in 2030. Adoption of Residential Storage Battery Systems - Results and Outlook (Non-recurring) 40 (10,000 units) 350,000 units (Cumul: approx. 3.14 MM units) 35 I Storage Batteries for New Homes (Non-recurring) Storage Batteries for Existing Homes / New PV installations (Non-recurring) Forecast 30 270,000 units I Storage Batteries for Existing Homes / Post-FIT (Non-recurring) (Cumul: approx. 1.58 MM units) 25 20 15 10 5 0 2016 2017 2018 2019 130,000 units (Cumul: approx. 490 K units) 2020 2025 2030 Source: METI Commission for the Promotion of Stationary Storage Battery Systems 18 Copyright gremz, Inc All Rights Reserved#19gremz Strengthen the sale of storage batteries, as demand for renewable energies is expected to expand (Unit: JPY MM) 5,000 4,500 Net Sales Trends by Product / Revenue (Unit: JPY MM) 2,000 Gross Margin on Sales Trends by Product / Revenue 1,941 1,891 4,583 4,615 63 59 140 139 1,750 3,924 4,000 140 3,465 3,500 140 3,000 1,500 1,476 59 1,248 1,250 62 3,335 3,455 2,500 2,551 1,000 1,867 2,000 1,013 728 750 1,496 1,459 1,500 198 500 208 65 1,000 218 69 65 1,247 250 500 999 1,020 382 377 880 327 309 O О FY 03/2019 (Realized) FY 03/2020 (Realized) FY 03/2021 (Realized) FY 03/2022 (Projected) FY 03/2019 (Realized) FY 03/2020 (Realized) FY 03/2021 (Realized) FY 03/2022 (Projected) Photo-voltaic Systems Residential Appliances ■Storage Batteries Electricity Sales Photo-voltaic Systems Residential Appliances ■Storage Batteries Electricity Sales 19 Copyright gremz, Inc All Rights Reserved#20gremz 3. Overview of FY03/2021 Energy Solutions Company 20 Copyright gremz, Inc All Rights Reserved#21Consolidated Net Sales Consolidated Net Sales for FY03/2021 stood at 19,311 MM Yen Continuous YoY Net Sales growth since the company's founding gremz (Unit JPY MM) New all-time high for Consolidated Net Sales - 19.3 billion yen 19,311 15,489 9,252 12,137 7,115 8.980 4,265 7,109 1,388 6,739 4,583 6,171 5,781 3,924 5,220 3,465 3,533 4,365 3,681 3,888 3,642 3,387 3,389 3,161 1,890 65 2,880 500 3,492 1,423 2,302 622 5,475 943 4,037 4,407 4,450 180 2,250 2,621 2,459 2,620 2,753 3,023 3,363 1,694 2,063 1,727 938 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY 03/2006 03/2007 03/2008 03/2009 03/2010 03/2011 03/2012 03/2013 03/2014 03/2015 03/2016 03/2017 03/2018 03/2019 03/2020 03/2021 ■Energy Cost Solutions Business (ECS) Smart House Project Business (SHP) Electricity Retailing Business (ER) Others 21 Copyright gremz, Inc All Rights Reserved#22Consolidated Operating Income. gremz 1,650 MM Yen in Operating Income foy FY03/2021, -455 MM Yen (-21.6% YoY) Operating Income declined due to the impact of losses in Electricity Retailing Business 3000 1,650 14.8% 14.9% 2,106 12.5% 11.1% 2500 10.6% 11.3% 11.5% 8.5% 745 6.8% 13.6% 6.8% 5.8% 4.8% 1,400 8.5% 2000 3.0% 1,362 456 1,018 1500 36 299 752 220 503 487 359 147 575 234 2,097 1000 104 356 296 278 262 21 158 224 78 1,223 1,280 500 427 955 990 1,042 209 956 210 674 700 595 556 64 347 О (30) (51) -400 -399 -383 -402 -384 -400 -451 (486) -582 -643 -635 -657 -500 -1000 -705 ECS SHP ER Administrative Expenses Others Consolidated Operating Income Margin -1500 FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY FY 03/2006 03/2007 03/2008 03/2009 03/2010 03/2011 03/2012 03/2013 03/2014 03/2015 03/2016 03/2017 03/2018 03/2019 03/2020 03/2021 22 Copyright gremz, Inc All Rights Reserved#23120 100 System Price (JPY/kWh) 20 Apr. 2016 Jul. 2016 Oct. 2016 Jan. 2017 10 60 2021/1/13 Daily avg. peak: 154.6 JPY/kWh gremz Impact to the Electricity Retailing Business of a Surge in the Market Price of Electricity A decrease in supply output from thermal power plants resulting from a decrease in LNG inventories, and increased electricity demand due to a cold wave caused strain in the market for electric power supply and demand. This led to a surge in JEPX (Japan Electric Power Exchange) purchase spot prices between Dec. 2020 and Jan. 2021, with a feedback loop between spot prices and imbalance fees leading to a surge in price. A decrease in sell bidding in the spot market meant that electricity was sold out for sustained time periods, with a large number of time intervals in which buyers and sellers could not be matched. This led to an imbalance fee (*) of approximately 2 billion yen, greatly raising the cost of sales for the Electricity Retailing Business. * * Imbalance Fees: Adjustment fee arising from an excess or deficiency in electricity supply, resulting from an imbalance between projected electricity retailer demand needs and actual demand. 180 10 160 160 140 Spot Market - Long-term System Price Trend (2016/4/1 2021/3/24) Average Daily Price (48 Intervals) 1,400,000,000 1,300,000,000 Spot Market Bidding / Execution Volume Trend (2020/12/12021/03/24) Sell Bidding (kWh) Purchase Bidding (kWh) Execution Volume (kWh) Jan. 2019 Apr. 2019 Jul. 2019 Oct. 2019 Jan. 2020 Apr. 2020 Jul. 2020 Oct. 2020 Jan. 2021 Unit: JPY/kWh 23 Bidding/Execution Volume (kWh) 700,000,000 600,000,000 2020/12/1 2020/12/3 2020/12/5 2020/12/7 1,200,000,000 1,100,000,000 1,000,000,000 900,000,000 000 2020/12/9 2020/12/11 2/13 2020/1415 2020/12/17 2020/12/19 2020/12/21 2020/12/23 2020/12/25 2020/12/27 2020/12/29 2020/12/31 2021/1/2 2021/1/4 2021/1/6 2021/1/8 2021/1/10 2021/1/12 2021/1/14 2021/1/16 2021/1/18 2021/1/20 2021/1/22 2021/1/24 M 2021/1/26 2021/1/28 2021/1/30 2021/2/1 2021/2/3 2021/2/5 2021/2/7 2021/2/9 2021/2/11 2021/2/13 2021/2/15 2021/2/17 2021/2/19 2021/2/21 *Source: Electricity and Gas Market Surveillance Commission Copyright gremz, Inc All Rights Reserved 2021/2/23 2021/2/25 2021/2/27 2021/3/1 2021/3/3 2021/3/5 2021/3/7 2021/3/9 2021/3/11 2021/3/13 2021/3/15 2021/3/17 2021/3/19 2021/3/21 2021/3/23 WW#24FY 03/2020 (Realized) Consolidated Results Overview (YoY / Compared to Forecast) Forecast FY 03/2021 (Announced 6/1/2020) FY 03/2021 (Realized) gremz Change (YoY) Compared to Forecast (Unit: JPY MM) Results % of Sales Results % of Sales Results % of Sales Change % Change % Change Change Net Sales 15,489 100.0% 16,853 100.0% 19,311 100.0% +3,822 +24.7% +2,458 +14.6% ECS 4,450 28.7% 4,657 27.6% 5,475 28.4% +1,025 +23.1% +818 +17.6% SHP 3,924 25.3% 3,672 21.8% 4,583 23.7% +659 +16.8% +911 +24.8% ER 7,115 46.0% 8,523 50.6% 9,252 47.9% +2,136 +30.0% +728 +8.5% Gross Margin on 5,767 37.2% 5,847 34.7% 5,333 27.6% (-434) (-7.5%) (-514) (-8.8%) Sales ECS 2,577 57.9% 2,882 61.9% 3,588 65.5% +1,010 +39.2% +706 +24.5% SHP 1,476 37.6% 1,379 37.6% 1,941 42.3% +464 +31.5% +561 +40.7% ER 1,713 24.1% 1,585 18.6% (-196) (-2.1%) (-1,909) Operating Income 2,106 13.6% 2,300 13.6% 1,650 8.5% (-455) (-21.6%) (-1,781) (-649) (-28.2%) ECS 1,042 23.4% 1,486 31.9% 2,097 38.3% +1,055 +101.2% +611 +41.2% SHP 359 9.2% 281 7.7% 745 16.3% +385 +107.3% +464 +165.1% ER 1,362 19.1% 1,219 14.3% (-486) (-5.3%) (-1,848) - (-1,705) Administrative (-657) (-686) (-705) (-47) (-19) Expenses Ordinary Income 2,168 14.0% 2,318 13.8% 1,745 9.0% (-422) (-19.5%) (-572) (-24.7%) Net Income 1,483 9.6% 1,546 9.2% 1,120 5.8% (-362) (-24.5%) (-425) (-27.5%) ECS (Energy Cost Solutions Business): GR consulting, Inc., gremz power, Inc., gremz solar Inc. SHP (Smart House Project Business): gremz solar, Inc. ER (Electricity Retailing Business): gremz power, Inc. 24 Copyright gremz, Inc All Rights Reserved#25Balance Sheet Statement (B/S) gremz (Unit: JPY MM) 3/31/2020 3/31/2021 Change Main Factors Cash and Deposits (+4,030 MM Yen) Notes and Accounts Receivable Current Assets 6,417 11,165 +4,748 (+804 MM Yen) (*) Coporate Tax Receivable Inventory (+247 MM Yen) (-371 MM Yen) Machinary and Equipment (-59 MM Yen) Fixed Assets 2,221 1,753 (-467) Investment Securities (-407 MM Yen) Total Assets 8,638 12,919 +4,280 Accounts Payable-Trade (+2,481 MM Yen) (*) Current Liabilities 2,660 5,204 +2,544 Current Portion of Long-Term Loans Payable (+118 MM Yen) Fixed Liabilities 844 1,697 +852 Long-Term Loans Payable (+851 MM Yen) Total Liabilities 3,504 6,902 +3,397 Net Assets Total Liabilities / Net Assets 5,133 6,016 +883 Comprehensive Income Capital Stock and Capital Surplus Dividends on Retained Earnings (+1,120 MM Yen) (+83 MM Yen) (-327 MM Yen) 8,638 12,919 +4,280 (*) Breakdown of increase in Accounts Receivable by segment - ECS: +382 MM Yen; SHP: +93 MM Yen; ER: +328 MM Yen Breakdown of increase in Accounts Payable by segment - ECS: -65 MM Yen; SHP: +150 MM Yen; ER: +2,395 MM Yen 25 Copyright gremz, Inc All Rights Reserved#26Cash Flow Statement (C/F) FY 03/2020 FY 03/2021 gremz (Unit: JPY MM) General Breakdown for FY 03/2021 Net Income Before Taxes and Other Adjustments (+1,737 MM Yen) Depreciation Expenses (+112 MM Yen) Decrease in Inventories (+371 MM Yen) Cash Flow from Operating Activities 1,600 2,921 Increase in Notes and Accounts Payable (+2,481 MM Yen) Increase in Notes and Accounts Receivable (-804 MM Yen) Corporate Tax and Others (-831 MM Yen) Proceeds from Sales of Investment Securities (+700 MM Yen) Purchase of Investment Securities Cash Flow from Investing Activities (-660) 375 (-300 MM Yen) Purchase of Property, Plant and Equipment (-54 MM Yen) Proceeds from Long-term Loans Payable (+1,400 MM Yen) Proceeds from issuance of Common Shares Cash Flow from Financing Activities (-254) 733 (+83 MM Yen) Repayment of Long-term Loans Payable Dividend Payouts (-430 MM Yen) (-327 MM Yen) Changes in Cash & Cash Equivalents 685 4,030 Ending Cash & Cash Equivalent Balance 4,176 8,206 26 Copyright gremz, Inc All Rights Reserved#27gremz 4. Overview of 2Q FY03/2022 Energy Solutions Company 27 Copyright gremz, Inc All Rights Reserved#28Overview of Consolidated Net Sales Consolidated Net Sales for 1H FY 03/2022 stood at 10,402 MM Yen, up 25.0% YoY (Unit: JPY MM) 7,000 Quarterly Net Sales Trend 6,466 ■ECS Business ■SHP Business 6,000 Electricity Retailing Business gremz 5,462 4,940 5,000 2,807 4,526 4,238 4,226 3,955 4,092 4,000 3,743 3,552 3,383 2,409 3,039 3,132 1,804 3,000 1,804 2,581 1,099 1,438 2,214 1,897 2,332 1,722 2,068 1,029 1,461 673 2,000 979 1,196 873 811 904 906 1,114 1,163 1009 839 834 873 916 1,000 1,936 1,068 1,198 1,304 1,455 1,209 1,244 1,237 1,197 1,367 1,229 836 758 886 O 1 Q 2Q 3Q 4Q 1 Q 2Q за 4Q 1 Q 2Q 3Q 4Q 1 Q 2Q 3Q 4Q FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 28 Copyright gremz, Inc All Rights Reserved#29Overview of Consolidated Operating Income (Unit: JPY MM) Consolidated Operating Income for 1H FY 03/2022 stood at 1,918 MM Yen, up 18.9% YoY Quarterly Operating Income Trend gremz 23.9% 25.0% 20.2% 2,100 20.0% 16.8% 15.8% 15.0% 14.9% 14.8% 15.5% 13.7% 12.5% 15.0% 1,500 11.3% 1,010 9.0% 8.4% 999 918 900 509 562 631 546 603 701 421 10.0% 401 445 466 458 273 354 274 127 263 339 295 165 118 452 98 108 155 108 266 5.0% 49 0 163 461 855 300 78 220 79 59 50 314 378 437 519 609 540 63 295 286 333 150 56 126 449 272 0.0% -147 -152 -164 -171 -152 -166 -160 -178 -174 -171 -178 -176 -180 -300 -900 -10.3% -5.0% -10.0% -1,500 ECS Business Electricity Retailing Business -Operating Income Margin SHP Business Administrative Expenses -1,758 -15.0% -182 -664 -2,100 -20.0% 1 Q 2Q 3Q 4Q 1 Q 2Q 3Q 4Q 1 Q 2Q 3Q 4Q 1 Q 2Q 3Q 4Q FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 29 Copyright gremz, Inc All Rights Reserved#30(Unit: JPY MM) Consolidated Results Overview (YoY / Compared to Forecast) 2Q FY 03/2021 (Cumulative) (Realized) 2Q FY 03/2022 Forecast (Cumulative) (Announced 5/14/2021) 2Q FY 03/2022 gremz (Cumulative) (Realized) Change (YoY) Compared to Forecast Results % of Sales Results % of Sales Results % of Sales Change % Change Change % Change Net Sales 8,319 100.0% 9,381 100.0% 10,402 100.0% +2,083 +25.0% +1,021 +10.9% ECS 2,341 28.1% 2,343 25.0% 2,597 25.0% +255 +10.9% +253 +10.8% SHP 1,747 21.0% 2,143 22.8% 2,172 20.9% +425 +24.3% +28 +1.3% ER 4,230 50.9% 4,894 52.2% 5,633 54.1% +1,402 +33.2% +738 +15.1% Gross Margin on Sales 3,397 40.8% 3,465 36.9% 3,801 36.5% +404 +11.9% +336 +9.7% ECS 1,489 63.6% 1,620 69.1% 1,779 68.5% +290 +19.5% +159 +9.9% SHP 725 41.5% 888 41.5% 912 42.0% +187 +25.8% +23 +2.7% ER 1,182 28.0% 956 19.5% 1,109 19.7% (-73) (-6.2%) +152 +16.0% Operating Income 1,613 19.4% 1,511 16.1% 1,918 18.4% +304 +18.9% +406 +26.9% ECS 791 33.8% 976 41.7% 1,150 44.3% +358 +45.3% +173 +17.8% SHP 168 9.6% 212 9.9% 264 12.2% +95 +56.7% +51 +24.4% ER 998 23.6% 697 14.2% 860 15.3% (-137) (-13.8%) +163 +23.4% Administrative (-345) (-375) (-357) (-11) +17 Expenses Ordinary Income 1,644 19.8% 1,527 16.3% 1,948 18.7% +303 +18.4% +421 +27.6% Net Income 1,124 13.5% 1,000 10.7% 1,324 12.7% +199 +17.8% +323 +32.4% * ECS (Energy Cost Solutions Business): GR consulting, Inc., gremz power, Inc., gremz solar, Inc. * SHP (Smart House Project Business): gremz solar, Inc. ER (Electricity Retailing Business): gremz power, Inc. 30 Copyright gremz, Inc All Rights Reserved#31Balance Sheet Statement (B/S) gremz (Unit: JPY MM) 3/31/2021 9/30/2021 Change Main Factors Cash and Deposits Inventory (-925 MM Yen) (-49 MM Yen) Current Assets 11,165 10,570 (-595) Corporate Tax Receivable Consumption Tax Receivable Accounts Receivable - Trade Investment Securities (-246 MM Yen) (-47 MM Yen) (+663 MM Yen) (+483 MM Yen) Machinery and Equipment (-29 MM Yen) Fixed Assets 1,753 2,090 +337 Deferred Tax Assets (-48 MM Yen) Lease and Guarantee Deposits (-68 MM Yen) Total Assets 12,919 12,661 (-258) Current Liabilities 5,204 3,950 Accounts Payable - Trade (-1,254) Accounts Payable - Other Corporate Tax Payable (-1,119 MM Yen) (-237 MM Yen) (+114 MM Yen) Fixed Liabilities 1,697 1,466 Total Liabilities 6,902 5,416 (-230) Long-term Loans Payable (-1,485) (-230 MM Yen) Net Assets 6,016 7,244 Changes in Accounting Policy +1,227 Comprehensive Income Dividends on Retained Earnings (+165 MM Yen) (+1,322 MM Yen) (-273 MM Yen) Total Liabilities / Net 12,919 12,661 (-258) Assets 31 Copyright gremz, Inc All Rights Reserved#32Cash Flow Statement (C/F) 2Q FY 03/2021 (Cumulative) 2Q FY 03/2022 (Cumulative) gremz (Unit: JPY MM) Main Breakdown for 2Q FY 03/2022 (Cumulative) Net Income Before Taxes and Other Adjustments (+1,942 MM Yen) Depreciation Expenses (+54 MM Yen) Cash Flow from Operating Activities 925 93 Decrease in Notes and Accounts Payable - Trade (-1,303 MM Yen) Decrease in Accounts Payable - Other (-286 MM Yen) Corporate Tax and Others (-331 MM Yen) Purchase of Investment Securities (-600 MM Yen) Purchase of Property, Plant, and Equipment (-30 MM Yen) Cash Flow from Investing Activities 175 (-448) Proceeds from Sales of Investment Securities (+113 MM yen) Proceeds from Collection of Lease and Guarantee Deposits (+68 MM Yen) Repayment of Long-term Loans Payable Cash Flow from Financing Activities (-396) (-569) (-297 MM Yen) Dividend Payouts (-272 MM Yen) Change in Cash & Cash Equivalents 704 (-925) Ending Cash & Cash Equivalents Balance 4,880 7,281 32 Copyright gremz, Inc All Rights Reserved#33gremz Energy Solutions Company 5. Financial Results and Dividend Forecast for FY03/2022 33 Copyright gremz, Inc All Rights Reserved#34Consolidated Results Overview gremz Forecast for FY 03/2022 Net Sales 20,025 MM Yen (+3.7% YoY); Operating Income 3,100 MM Yen (+87.8% YoY) Net Sales Operating Income 12,137 4,265 8,980 20 1,388 15,489 7,115 20,025 19,311 13.6% 15.5% 3 100 11.5% 11.3% 1,485 1,650 2,106 9,252 10,844 745 1,400 1,362 550 8.5% 1,018 456 36 299 220 359 2,097 1,817 4,583 4,615 3,924 3,465 1,223 1,280 3,533 1,042 -451 -486 5,475 -635 -657 -752 4,407 4,450 4,565 4,037 -9 -705 FY 03/2018 FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 (Projected) FY 03/2018 FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 (Projected) ECS Business ECS Business ■SHP Business Electricity Retailing Business ■ Others Others 34 Electricity Retailing Business SHP Business Administrative Expenses Operating Income Margin Copyright gremz, Inc All Rights Reserved#35FY 03/2022 Forecast gremz 2Q FY 03/2022 FY 03/2021 (Realized) 2Q FY 03/2022 Forecast (Unit: JPY MM) (Cumulative) (Realized) Cumul. Progress Rate (Announced 5/14/2021) Change (YoY) Results % of Sales Results % of Sales Results % of Sales Change % Change Net Sales 19,311 100.0% 10,402 100.0% 51.9% 20,025 100.0% +713 +3.7% ECS 5,475 28.4% 2,597 25.0% 56.9% 4,565 22.8% (-910) (-16.6%) SHP 4,583 23.7% 2,172 20.9% 47.1% 4,615 23.0% +31 +0.7% ER 9,252 47.9% 5,633 54.1% 51.9% 10,844 54.2% +1,592 +17.2% Gross Margin on Sales 5,333 27.6% 3,801 36.5% 53.9% 7,048 35.2% +1,715 +32.2% ECS 3,588 65.5% 1,779 68.5% 56.9% 3,129 68.5% (-459) (-12.8%) SHP 1,941 42.3% 912 42.0% 48.3% 1,891 41.0% (-50) (-2.6%) ER (-196) (-2.1%) 1,109 19.7% 54.7% 2,028 18.7% +2,224 Operating Income 1,650 8.5% 1,918 18.4% 61.9% 3,100 15.5% +1,449 +87.8% ECS 2,097 38.3% 1,150 44.3% 63.3% 1,817 39.8% (-280) (-13.4%) SHP 745 16.3% 264 12.2% 48.0% 550 11.9% (-195) (-26.2%) ER (-486) (-5.3%) 860 15.3% 57.9% 1,485 13.7% +1,972 Administrative Ex. (-705) (-357) 47.5% (-752) (-46) Ordinary Income 1,745 9.0% 1,948 18.7% 61.7% 3,155 15.8% +1,409 +80.8% Net Income 1,120 5.8% 1,324 12.7% 63.9% 2,073 10.4% +953 +85.1% ECS (Energy Cost Solutions Business): GR consulting, Inc., gremz power, Inc., gremz solar, Inc. SHP (Smart House Project Business): gremz solar, Inc. ER (Electricity Retailing Business): gremz power, Inc. 35 Copyright gremz, Inc All Rights Reserved#36Consolidated Operating Income Breakdown 3,000 2,500 2,000 (Unit: JPY MM) An expansion in Electricity Retailing has led to an increase in recurring profit Electricity Retailing (Recurring Profit) Replacement Sales (Recurring Profit) Energy Intermediation Consolidated Operating Income 98.4% O Circuit Breaker Rentales (Recurring Profit) Electricity Sales (Recurring Profit) Direct Sales Breakdown Trends 85.4% gremz 110% 3,100 90% 1,486 70% 2,106 (Recurring Profit) (Non-recurring Profit) 1,650 93 Recurring Profit as % 69.6% 61.7% 58.3% 59.0% 526 53.0% 50,3% 1,400 121 1,500 37.2% 1,000 63 1,362 142 50% 1,018 378 456 59 752 36 114 34 62 575 18 292 30% 500 278 356 18 315 65 415 78 1,313 180 158 16 214 62 365 942 61 14 11 48 155 7 99 121 1634 188 28 114 202 20.5% 47 59 422 272 282 205 208 10% 34 -52 -487 (Unit: JPY MM) (Realized) (Realized) (Realized) -500 FY 03/2013 FY 03/2014 FY 03/2015 FY 03/2016 FY 03/2017 FY 03/2018 FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 (Realized) (Realized) (Realized) (Realized) (Realized) (Realized) (Realized) (Realized) (Realized) (Projected) -10% FY03/2013 FY03/2014 FY03/2015 FY03/2016 FY03/2017 FY03/2018 FY03/2019 FY03/2020 FY03/2021 FY03/2022 (Realized) (Realized) (Realized) (Realized) (Realized) (Realized) (Projected) Recurring 58 169 190 306 455 606 1,196 2,072 337 2,158 Profit Consolidated Operating 158 278 356 575 752 1,018 1,400 2,106 1,650 3,100 Income 36 Copyright gremz, Inc All Rights Reserved#37Dividend Forecast for FY 03/2022 gremz We raised dividends for the 5th consecutive fiscal year, from FY 03/2017 to FY 03/2021 In FY 03/2021, the interim dividend was 5 yen/share (including a commemorative dividend of 2.5 yen/share) and a year-end dividend of 12 yen/share (including a commemorative dividend of 2.5 yen/share) We forecast an interim dividend of 5 yen/share and a year-end dividend of 9.5 yen/share in FY 03/2022 Dividend per share, Net Income, Dividend Payout Ratio (Consolidated) 50.00% 2,073 22.3% 32.9% 28.2% 34.4% 1,483 40.00% 30.00% 1,120 20.7% 1,001 19.6% 19.0% 18.3% 20.00% 14.3% 145 15.9% 17.0 703 505 12.0 8.5 399 10.00% 6.3 228 2.5 2.5 154 193 4.2 2.5 2.5 FY 03/2013 FY 03/2014 FY 03/2015 FY 03/2016 Final Dividend (JPY) FY 03/2017 FY 03/2018 Net Income (JPY MM) 0.00% FY 03/2019 FY 03/2020 FY 03/2021 FY 03/2022 (Projected) Dividend Payout Ratio (%) * Dividend per share calculated retroactively to account for a 1:2 stock split carried out on January 1, 2014, a 1:1.5 stock split carried out on October 1, 2017, a 1:2 stock split carried out on August 1, 2018, and a 1:2 stock split carried out on September 1, 2020. 37 Copyright gremz, Inc All Rights Reserved#38gremz 6. Sustainability Energy Solutions Company 38 Copyright gremz, Inc All Rights Reserved#39Sustainability at gremz, Inc. gremz, Inc. will continue growing by offering environmentally-friendly products and services in the domains of energy-saving solutions, energy. generation, and energy storage, and contribute to the building and sustainable development of a prosperous and safe society. . Contribute to the improvement of energy efficiency through the sale of advanced energy-saving products. . Contribute to building a decarbonized society through the sale of products related to renewable energies, such as photo-voltaic systems and storage batteries. . We will aim to continue progressing alongside society through the provision of products and services attuned to the needs of society. gremz Related SDGs SUSTAINABLE DEVELOPMENT GOALS AFFORDABLE AND CLEAN ENERGY 39 11 SUSTAINABLE CITIES AND COMMUNITIES 13 CLIMATE ACTION Copyright gremz, Inc All Rights Reserved#40gremz Our Corporate Vision Filling the World with Inspiration and Joy In this world of constant change, we want to remain thankful for our customers' continued support. We want to continue building a symbiotic relationship with society. We hope to eradicate information asymmetries and contribute to the widespread use of high-value added product solutions that make people's lives safer and more comfortable. Our Corporate Vision Our Customers Consistently deliver quality service to our customers. Our Employees Create a positive work environment leading to a fulfilled and highly motivated workforce. Our Shareholders Reward our shareholders with continuous and sustainable growth Society Stay on top of Social needs and offer high value-added solutions. 40 Copyright gremz, Inc All Rights Reserved#41gremz Please direct your inquiries to the following number and e-mail address: TEL 03-5769-3500 [email protected] Energy Solutions Company (Disclaimer) This slide presentation is not an official disclosure document as defined by the Financial Instruments and Exchange Act. We offer no guarantee regarding the accuracy of any or all information contained herein. This document is for information purposes only and does not constitute an offer to sell or solicit an offer to buy any products or securities associated with gremz, Inc. Any statements concerning the Company's future business performance are based on information available as of the creation of this slide presentation and are premised on certain assumptions deemed to be reasonable by the company. As such, we reserve the right to change, without notice, any such forecasts contained within the present document.