Medium-Term Management Plan

Some figures relating to the Financial Goal and Capital Policy have been revised to reflect the changes described in the "Notice concerning the Fiscal 2022 to 2024 Medium-Term Management Plan and Impact on Financial Indicators" published on September 20, 2022.
Such figures have been indicated with asterisks (**).

Long-Term Vision

Continuously Growing Company Driven by New technologies and New Products Created through R&D → Establish a Profitable Buisiness Model and Convert to a Highly Profitable Company

Basic Measures to Realize the Long-Term Vision

  • Strengthen R&D as a growth driver
  • Clarify roles of each business and optimize the business portfolio

Business portfolio

1.[Businesses to grow and foster] Fostering and growth of businesses through investment -Basic Chemicals(*HFO products) -Specialty chemicals -Commercialization of priority research areas 2.[Core businesses] Increase in earnings capability through aggressive investment and establishment of supply chain -Electronic materials -Energy materials 3.[Businesses to be restructured] Structural reform and rebirth of the ability to generate cash -Architectural glass, automotive glass -Fertilizer 4.[Matured and cash-cow businesses] Futher increase in business efficiency and the ability to create cash -Medical chemicals -Glass fiber (*)HFO:Hydrofluoroolefin(Products that have low global warning potential (GWP) and comply with regulations on chlorofluorocarbon)

Basic Policy of Medium-Term Management Plan

  1. Achieve new growth by strengthening our business foundations and original technologies
    • Return to a growth path
      • Concentrate managerial resources to the businesses to be grown in order to accelerate establishment of profitable business models and business expansion to growth markets
      • In the chemicals business, harvest the fruits of previous investments and continue further investment for the future
      • In the glass business, complete the structural reform and evolve toward profitable business
      • In other business, further increase earning capability and maximize free cash flow
    • Continue strengthening R&D to ensure future growth
    • Provide stakeholders with reassurance and reliability by increasing all employees' quality awareness
  2. Maintain a healthy financial base
    • Distribute cash flows based on a well-balanced consideration of shareholder returns, investments, and financial discipline
  3. Contribute to the global environment
    • Reduce greenhouse gas emissions
    • Provide products and technologies that contribute to reducing environmental burden

Financial Goals(FY 2024 Target)

Aim for achievement of 12%** ROE

Indicator FY 2024 Target
Major item Operating Profit (100 million yen) 140
Operating Profit Ratio 8%
Financial indicator ROE 12%**
Shareholder returns Total Return Ratio At least 30%
Dividend on Equity (DOE) 3.6%**
  • Capital investments: 41.0 billion yen (3-year cumulative total)
  • Cost for R&D: 24.0 billion yen (3-year cumulative total)
Trend in operating profit(by segment)

Capital Policy

Seek a capital structure focusing on optimization of investment and funding with the aim of maximization of enterprise value

Basic policy for capital policy

Fund-ing Stably and systematically raise funds through a combination of appropriate methods, taking into account the balance between funding cost and continuity (risk)
Management (Investment) Inject capital to selected sources generating profits exceeding funding cost and cash flow exceeding invested capital
Distribution Distribute generated cash based on a well-balanced consideration of shareholder returns, investments and financial discipline
3-year cumulative total
Operating CF 480
Investing CF Capital Investment (410)
Sales of assets 170
Investing CF Total (240)
Free CF 240
Financing CF Dividend (100)**
Funding/Repayment 340**
Acquisition of treasury shares (550)**
Financing CF Total (310)**

(Unit 100 milion yen)

Policy for shareholder returns

  • Total Return Ratio: At least 30%
  • DOE (Dividend on Equity Ratio): 3.6%**
  • Acquisition of treasury shares
    • Fundamentally based on the dividend criterion DOE and the dividend amount based on total shareholder return ratio and adjusted as needed
    • Allocate about 50% of funds raised by sales of shares in the FY 2022 plan to acquisition of treasury shares

Major investments

  • Chemicals
    • Invest in commercialization of priority research areas
      (power semiconductor materials: From research to mass production facility)
    • Electronic materials: Construct new product facilities and increase capacity
    • Energy materials: Secure the ability to purchase raw materials (invest in supply chain)
      Expand manufacturing bases
  • Glass
    • Invest mainly in maintenance and renewal within operating cash flow
      (Keep free cash flow positive)

R&D Policy

  • Focus areas:Electronic materials, energy materials, and priority areas of corporate research(*)
    (*) Corporate research refers to the long-term research exploring for new areas in foundation research.
    Expansion into unprecedented areas with our core technologies + open innovation, and sustainability-conscious
  • Aggressively inject R&D resources toward solution proposition for customer needs (such as potential needs, performance improvement and environmental burden reduction)
  • Strengthen functional materials business by improving application development technologies
    (performance assessment and data science) (expansion of applications of our original compounds)

Intellectual Property Strategy(Advance a three-pronged strategy along with business and research and maximize earnings)

  • Intellectual property department plays the role of creating and using intellectual property rights and respecting the intellectual property rights of other companies.
  • Intellectual property department contributes to present and future profits of the Company through intellectual property rights in cooperation with business and research departments.

Measures toward the Global Environment

Challenge to realize net-zero GHG emissions in 2050 (Scope 1+2) Milestone reduction goal for GHG emissions in 2030 (vs 2013) Our goal (our group total volume): reduction goal of 40%