ºÚÁÏÃÅ

Sustainability Bonds Outline

Name	ºÚÁÏÃÅ Holdings Co., Ltd.'s 10th series of unsecured corporate bonds (Limited inter-bond pari passu rider) (Sustainability Bonds)
Maturity:	5 years
Issue amount:	JPY 10.0 billion
Coupon rate:	0.050%
Issue date:	Friday, April 23, 2021
Use of proceeds:	Procurement of ºÚÁÏÃÅ Sustainable Cocoa Beans Supporting cocoa farmers (ºÚÁÏÃÅ Cocoa Support) Energy saving and energy creation at domestic and overseas plants Securing and conserving domestic and overseas water resources Switching to environmentally friendly packaging (plastic - paper) Capital investments and R&D for initiatives related to infant nutrition (General milk formulas and specialized formulas) R&D and capital investments in infectious disease prevention
Bond rating	AA- (Japan Credit Rating Agency, Ltd.)
Lead managers	Mizuho Securities Co., Ltd., Daiwa Securities Co., Ltd.
Structuring agent*	Mizuho Securities Co., Ltd.

* An agent that supports the execution of sustainability finance by giving advice on both the formulation of sustainable finance frameworks, as well as on obtaining Second-Party Opinions.

Third-Party Assessment of Framework and Eligibility

For the purposes of issuing sustainability bonds, ºÚÁÏÃÅ Holdings established a sustainable finance framework.* Upon its establishment, it received the highest possible rank (SU1(F)) from the third-party organization, Japan Credit Rating Agency.

* Sustainable Finance Framework

Reporting

We annually disclose the fund allocation status reporting and the impact reporting until all raised funds allocated to applicable projects.

Allocation Status Reporting（FY2021）

Theme	Applicable project	Allocations (JPY 100 million)
Sustainable Procurement	Procurement of ºÚÁÏÃÅ Sustainable Cocoa Beans	14.7
Caring for the Earth	Energy efficiency and energy creation at domestic and overseas plants*	3.6
	Securing and conserving domestic and overseas water resources	7.5
	Switching to environmentally friendly packaging (plastic – paper)	4.3
Healthier Lives	Capital investments and R&D for initiatives related to infant nutrition (General infant formulas and special formulas)	22.9
	R&D and capital investments in infectious disease prevention	4.3
Total		57.3

* Fluorocarbons reduction costs include switching to natural refrigerants and fluorocarbons alternatives.

Allocation Status Reporting（FY2022）

Theme	Applicable project	Allocations (JPY 100 million)
Sustainable Procurement	Procurement of ºÚÁÏÃÅ Sustainable Cocoa Beans	14.2
Caring for the Earth	Energy efficiency and energy creation at domestic and overseas plants*	9.8
	Securing and conserving domestic and overseas water resources	0.7
	Switching to environmentally friendly packaging (plastic – paper)	4.6
Healthier Lives	Capital investments and R&D for initiatives related to infant nutrition (General infant formulas and special formulas)	27.2
	R&D and capital investments in infectious disease prevention	0.3
Total		56.8

* Fluorocarbons reduction costs include switching to natural refrigerants and fluorocarbons alternatives.

Impact Reporting（FY2021 - FY2023）

Applicable Project	Impact Reporting
	Output (Project Progress and Results)	Outcome (Effects Related to Issue Resolutions)				Impact (Effects Arising From Outcome)
			FY2021	FY2022	FY2023
Procurement of ºÚÁÏÃÅ Sustainable Cocoa Beans	Procurement of cocoa beans with sustainable programs	Procurement of ºÚÁÏÃÅ Sustainable Cocoa Beans as a percentage of total cocoa beans procured	42%	62%	62%	Improvement in producer livelihoods Ensure food quality and safety for consumers
Energy efficiency and energy creation at domestic and overseas plants	Reduce CO2 emissions by at least 50% compared with FY2019 by FY2030	Reduce CO2 emissions through energy conservation measures at new and existing plants	1,329t-CO2	3,709t-CO2 (The total from FY2021 to FY2022)	7,625t-CO2 (The total from FY2021 to FY2023)	Reduce CO2 emissions
	Expand use of electricity derived from renewable energy sources to at least 50% by FY2030	Reduce CO2 emissions through solar power generation	1,669t-CO2	2,358t-CO2 (The total from FY2021 to FY2022)	3,014t-CO2 (The total from FY2021 to FY2023)
	Eliminate use of specified fluorocarbons at domestic production sites by FY2030.	Number of facilities switched to natural refrigerants or fluorocarbons alternatives	446 units	565 units (The total from FY2021 to FY2022)	717 units* (The total from FY2021 to FY2023)	Protect the ozone layer
Securing and conserving domestic and overseas water resources	Upgrade equipment at existing plants and office	Reduction rate of water consumption (basic unit) *Reduce water consumption compared with FY2020 (From FY2022) (Unit of sales after applying the Accounting Standard for Revenue Recognition and other standards)	8.4% (compared with FY2017)	13.3% (FY2022 results)	15.7% (FY2023 results)	Reduce environmental impact through efficient use of water and appropriate wastewater management, etc.
	Introduce water-saving equipment at new plants, etc.
	Reduce water consumption by at least 15% compared with FY2020 by FY2030 in global *The base year and KPI were changed because sales after applying the Accounting Standard for Revenue Recognition and other standards were used in the per unit calculation.
Switching to environmentally friendly packaging (plastic – paper)	Reduce plastic used for one-way plastic containers and packaging by at least 30% compared with FY2017 by FY2030	Plastic reduction	13% (FY2020 results)	16% (FY2021 results)	18.3% (FY2022 results)	Solve the issues of marine pollution caused by plastic waste
Capital investments and R&D for initiatives related to infant nutrition (General infant formulas and special formulas)	Develop and produce cube-type infant formula	Investment in production facilities for cube-type infant formula				Achieve healthy growth of infants and toddlers Reduce childcare burden on caregivers
		High-speed line production facility construction	JPY 1.3 billion	JPY 2.36 billion	JPY 0.85 billion*1
		Utilities construction	JPY 0.99 billion	JPY 0.36 billion	JPY 0.26 billion*1
R&D and capital investments in infectious disease prevention	Product development	Status of projects in development	PhaseⅠtrials underway (overseas)	PhaseⅡclinical trial in preparation	PhaseⅡclinical trial in preparation	Decrease the number of patients suffering from infectious diseases Support domestic medical systems Prevent severe disease through the impact of vaccines

*1Reference value as funds have been appropriated by FY2022

We obtained a review from the Japan Credit Rating Agency to assess the conformity of this reporting with our sustainability finance framework.

Review by the Japan Credit Rating Agency (Issuance date: July 15, 2022)

Review by the Japan Credit Rating Agency (Issuance date: July 14, 2023)

Review by the Japan Credit Rating Agency (Issuance date: July 31, 2024)