New Year's Address from the President (Summary)

For the EBARA Group, this year marks the second and final year of our ongoing medium-term management plan, E-plan 2016, and marks the year in which we will reap the concrete results of our business activities over the past three years. This will also be the year in which we prepare to formulate our next medium-term management plan.
We want this to be a year in which things grow, leap forward, and mature deeper.

Now, at the start of the year, I would like to talk about the four basic policies set out in E-Plan 2016, their progress, and future measures.
The first is "ensuring that market growth is incorporated into our business." Last year, in our pump business, we acquired an Indonesian maintenance services company and a Brazilian land pump company. We will steadily expand our overseas business with our newly acquired subsidiaries in emerging countries where future market growth is expected. In the refrigeration and cooling business, we will capture demand in the ever-expanding Chinese market. In the precision machinery and electronics business, we will utilize the experience we have gained over the 30 years since our founding, especially the results we have gained from our continued production innovation efforts, in the face of robust market demand, and aim to revamp our production system to be even more competitive.

The second is to be a service company that covers the entire life cycle of products and plants. In the pump business, we will further expand our service and support operations, particularly in the overseas custom pump business. In the compressor and turbine business, we established a service base in Bangalore, India last year. In this business too, we will work to expand our service and support operations, which are important for profitability. In the engineering business, we are steadily increasing the number of facilities under contract for operation management and the number of domestic regular customers, which are KPIs, toward achieving our target figures.

The third is to "continuously strengthen our Core Competence (technical capabilities) as an industrial machinery manufacturer." We will continue to work on EOI (Ebara Open Innovation) and EOL (Ebara Open Laboratory), which are being carried out as a company-wide initiative. As for products and systems, we will further strengthen the overall competitiveness of our products, including performance, functionality, delivery time, and price, with the goal of making them overwhelmingly competitive compared to our competitors.

The fourth goal is to "expand the management infrastructure that supports global business development." The company's vision for fiscal 2019 is to "create an environment in which each employee can develop and maximize their capabilities, regardless of gender, nationality, etc., and to introduce a system to reward employees with compensation commensurate with the capabilities they demonstrate." Last year, the company established a Diversity Promotion Office and began efforts with a focus on promoting women's participation in the workforce. We have formulated a diversity declaration as a guideline for future diversity promotion activities, which we would like to introduce here.

• "We will create an environment where each individual can demonstrate their strengths and grow through their work."
• "We will respect each other's values, promote transformation into a corporate culture that resonates with one another, and achieve company growth and contribution to society."
• "We will innovate in our operations and production, aiming to create a workplace where diverse work styles can be selected."

Finally, this year is an important one in which we will reap concrete results from our business activities over the past three years. Let's create a corporate structure and business foundation that is less susceptible to the effects of the external environment, continue to strengthen our competitiveness as a manufacturer, and make our profit-generating business fields even more robust.

(The above is a summary of the New Year's address given at our company's opening ceremony on January 5th.)