■ Growth strategy for the medium to long term of Hatch-Work <148A>

The policy is to accelerate the growth of the monthly parking innovation business as the growth engine of AP cloud services, based on the stable operation and profit acquisition of the building innovation business. The growth strategy is set in three stages, expanding the number of AP cloud registrations, collecting and utilizing data, and stepping up to the 'FIRST ONE MILE STATION concept'.

1. Growth Strategy 1-Expansion of AP Cloud Registrations-

The market size of monthly parking lots is estimated to be just under 50% of the 61.97 million registered autos in Japan. Comparing the current 345,000 AP cloud registrations, there is substantial room for expansion. However, due to the increasing number of competing companies, the company considers filling the market gap through the expansion of AP cloud registrations as the top priority. The company plans to cycle the expansion of AP cloud registrations by increasing the number of users through the awareness and convenience improvement of the portal site 'At Parking', increasing the functionality and high evaluation of 'At Parking Cloud' to increase the number of contracted companies, and capturing users and registration numbers in new market areas and opportunities created by redefining monthly parking lots. To achieve the selection of 'At Parking' by users, the company plans to implement measures such as UI/UX improvement through renewal, strengthening of web marketing, enhanced PR and media publicity to enhance the branding of 'At Parking', providing additional value and increasing repeat usage after parking contracts, and improving customer satisfaction through automated customer support using interactive AI. In order to be selected by management companies, 'At Parking Cloud' measures include adding management system functions and UI/UX improvements, increasing IT personnel (10 staff in fiscal year 2024), and implementing measures to eliminate barriers to introduction by management companies. It also aims to create a new market for monthly parking lots by converting unused land into monthly parking lots, converting 'blank spaces' such as parking lots in commercial facilities into monthly parking lots, and making resident-only parking lots open for general monthly parking use.

※ UI/UX: Abbreviation for User Interface (UI) / User Experience (UX). User interface refers to the design of screens and button placement when users operate a system. User experience refers to the overall experience of ease of use and satisfaction that users gain through the system.

2. Growth Strategy 2-Collection and Utilization of Data-

By utilizing attribute data such as parking lots, users, and vehicle data collected and managed in the monthly parking lots, various demand forecasting analyses can be conducted. Based on this, the company aims to realize recommendations and proposals while collaborating with other companies. Several new projects based on demand forecasts are already underway. For example, based on vehicle data, the company is recommending the installation of EV charging stations. In March 2023, an alliance with Terra Motors, Inc. resulted in the launch of the operation of an EV charging service with monthly parking lots at Grand Prince Hotel Shinagawa. In November of the same year, an alliance with Terra Motors, Inc. in the development of EV charging infrastructure led to the operation of the service at monthly parking lots in rental apartments. Taking advantage of variable data such as Akimachi reservations and real-time vacancy information, 'At Parking Weekly' for short-term contracts is being offered to nearby construction-related vehicle users and temporary users. Contracts are also available on a daily or monthly basis. The company is also collaborating with various car service providers to expand the user base by providing car care services and offering 'At Parking Car Support' while parking. Furthermore, by utilizing vacancy information, the company has developed over 400 locations in collaboration with car sharing companies to redefine monthly parking lots as car sharing bases, creating new market areas and opportunities one after another.

3. Growth Strategy 3- 'FIRST ONE MILE STATION Concept'-

As the final step of the growth strategy, we propose the "FIRST ONE MILE STATION concept". This aims to redefine monthly parking lots in areas adjacent to daily life (=First One Mile) and build a nationwide network of stations that serve various mobility services. The goal is to improve convenience for local residents and others, not only as parking lots but also as a base for EV charging stations, car care stations, car-sharing stations, mobile sales and delivery stations, drone stations, and many other mobility service stations. We aim to create a new economic zone by attracting various mobility service providers to these stations. In fact, starting from May 2024, we launched a social experiment in collaboration with the Kobe Future City Organization, a third-sector organization in Kobe City. In June 2024, we also formed a business alliance with Phil Company, which specializes in space solutions, to provide services that solve administrative challenges using parking lots and vacant land managed by local governments. Phil Company has previously worked on over 250 space solution projects and offers unique services such as "Sky Shop Phil Park" and "Premium Garage House", which are integrated with monthly parking lots. By combining these with the "@Parking Cloud", we are developing services that contribute to improving the value of all-in-one parking lots.

(Author: FISCO Guest Analyst Shuji Matsumoto)