• TOTO adopts key initiatives included in Palliser’s value enhancement plan
• Management has taken meaningful steps to address value gap and support sustained growth in its Advanced Ceramics business

Palliser Capital (“Palliser”) welcomes the changes outlined in TOTO’s earnings presentation on April 30, 2026, which will begin to address the Company’s value gap and represent an important step toward unlocking its true intrinsic value.

The meaningful actions taken by the Company reflect the implementation of initiatives that Palliser published on February 17, 2026, in its value enhancement plan titled “Maximizing the Value of TOTO – The Most Undervalued and Overlooked AI Memory Beneficiary.” Palliser commends TOTO for its constructive engagement and its plans to implement several initiatives aligned with the value enhancement plan, including:

• Improving disclosure and transparency of the Advanced Ceramics business, enabling investors to better assess its growth outlook and competitive positioning;
• Increasing investment in the Advanced Ceramics segment to support sustained growth and strengthen long-term value creation;
• Implementing targeted restructuring initiatives within the low-profit toilet business to enhance profitability and operational efficiency; and
• Enhancing capital efficiency by optimising the capital structure toward an appropriate equity ratio, in line with stated financial discipline.

“TOTO’s management has taken meaningful steps, including actions aligned with our recommendations, that we expect will enhance long-term corporate value and eventually benefit all stakeholders of TOTO,” said James Smith, CIO at Palliser Capital. “Building on its leadership in sanitaryware, the Company is well positioned to continue expanding its role as a supplier of semiconductor materials tied to the buildout of global AI infrastructure projects. We believe our engagement has supported a distinguished company such as TOTO in gaining greater recognition for its intrinsic value within the global capital market, and remain committed to supporting other Japanese firms in their pursuit of future corporate value creation.”

About Palliser Capital

Palliser is an alternative investment manager that applies a value-oriented, event-driven philosophy to investing across a range of distinct yet complementary strategies on a global basis with a focus on situations where positive change and value enhancement can be achieved through thoughtful, constructive, and long-term engagement with companies and across a range of different stakeholder groups.

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