Growth Strategy for Grid-Scale Battery Storage Business – Building a New Foundation for High Growth

AD Works Group Co., Ltd. (TSE Prime: 2982, headquarters: Chiyoda-ku, Tokyo; Representative Director, President & CEO: Hideo Tanaka; hereinafter "ADWG") has announced the growth strategy of its 100% subsidiary, AD Works Co., Ltd. (headquarters: Chiyoda-ku, Tokyo; Representative Director, President: Shunya Suzuki; hereinafter "ADW") for its grid-scale battery storage business.

Early Entry into a Growing Market Accelerates Competitive Strength

ADW has entered the grid-scale battery storage business early, recognizing it as a high-growth market with strong profitability potential. The company is accelerating a virtuous cycle of strengthening competitiveness through accumulated operational experience.

Going forward, this business will remain a key growth driver expected to contribute significantly to mid- to long-term profits.

1. A Growing Market with Rising Demand Driven by Renewable Energy Adoption

The domestic market size for battery storage is projected to expand to approximately 424 billion yen by fiscal year 2030.

Consequently, the deployment of battery storage facilities—essential infrastructure for the widespread adoption and integration of renewable energy—is expected to grow substantially.

2. Our Position and Business Model

ADW collaborates with various stakeholders to identify projects, execute installation and construction of battery storage systems, and manage power trading operations.

In the future, the company aims to capture diversified revenue opportunities through operations across multiple electricity markets and the sale of battery storage assets.

3. Creating a Virtuous Cycle of Competitive Advantage Through Early Entry

In the grid-scale battery storage business, ADW leverages core competencies from its existing operations and entered the formative stage of this high-profitability growth market early, steadily advancing its initiatives.

Early procurement achievements, know-how accumulation, and partnership development following market entry are forming a virtuous cycle that enhances competitive strength.

4. Growth Strategy Aligned with Market Phases

ADW views the growth of its grid-scale battery storage business in three phases. From market formation through initial growth, the company will expand its scale while securing high operational returns from self-owned assets.

During the stable growth phase, the company aims to diversify revenue streams and improve capital efficiency through asset sales to external investors and asset management (AM) fee income.

5. Acquisition of Three Additional Sites – Progress Toward 10-Site Target

ADW has newly acquired three sites in Kumamoto City (Kumamoto Prefecture), Nichinan City (Miyazaki Prefecture), and Taiki Town (Mie Prefecture), bringing its total number of owned sites to six.

Furthermore, acquisitions for projects No. 7 and beyond are anticipated, and the virtuous cycle of enhanced competitiveness through early market entry is expected to accelerate further.

Additional details on the business model and market growth outlook for the grid-scale battery storage business are also included in the attached materials.

For more details on the growth strategy, please visit the following URL:

〇 Growth Strategy for Grid-Scale Battery Storage Business – Building a New Foundation for High Growth

https://contents.xj-storage.jp/xcontents/32500/5ac71dd3/db8f/47a9/a46b/6d2d3d8f4c6d/140120260615570875.pdf

About AD Works Group Co., Ltd.

AD Works Group Co., Ltd. is an investment solutions company focused on real estate. Listed on the TSE Prime Market, the company operates domestically and internationally with headquarters in Tokyo and additional offices in Osaka, Fukuoka, and Los Angeles.

The company's origins date back to 1886 (Meiji 19), and it has continuously evolved with the times. Guided by its North Star (Purpose) and Vision, ADWG provides diverse real estate investment products tailored to the needs of both individual and institutional clients.