To Investors

Hiroshi Yokota President

Hiroshi Yokota
President

Hiroshi Yokota President
Evolving into a Value-Creative Company through a Market-in Approach

Tokuyama has continued to grow through a product-out approach, expanding its business based on its own strengths and proprietary technologies. However, the product-out concept is becoming obsolete with the digital revolution changing the structure of industries and the need to address ESG concerns an increasingly urgent issue. Accordingly, Tokuyama is now taking up a market-in approach, which entails the development and provision of products and services based on customer needs. This approach considers such issues as how to create new products and services that society demands and how to build new business models that contribute to economic development while being environmentally friendly.

In order to transform Tokuyama into a market-in company, we recognize the critical need to revise our management philosophy, which forms the foundation of our business activities. With this in mind, we redefined our Mission in 2021. Our Mission is now to create a bright future in harmony with the environment, in collaboration with its customers, based on chemistry. Subsequently, we formulated and announced details of our Medium-Term Management Plan 2025, covering the five-year period from FY2021 to FY2025, clearly stating Tokuyama's vision for the future and the process to achieve it.

Transformation of Our Business Portfolio

Tokuyama's basic strategy for the future is to focus on creating new businesses that help solve social issues, rather than engaging in conventional energy-intensive materials activities. The Company has identified three target domains: electronics, healthcare, and the environment. Positioning an increase in the ratio of growth business sales to total consolidated net sales to more than 50% in FY2025 as an initial milestone, we will then work to further expand this ratio to more than 60% by FY2030.

In the electronics domain, we will secure a top share in each of the high-purity and heat-dissipation materials fields, while promoting further globalization. In the health domain, our goal is to become the industry leader in the vision, dental, and diagnostics fields, where we can differentiate ourself with the Company's unique technologies. In the environment domain, we will work to increase our production capacity for water treatment membranes, expand our waste gypsum board recycling business, and take photovoltaic module recycling beyond the R&D stage toward commercialization, thereby developing the environment business into a new pillar for the future of the Group.

Carbon Neutral Initiatives

In the Company's Medium-Term Management Plan 2025, helping to fight global warming is positioned as a priority issue. Through decarbonization and the development/implementation of environmentally-friendly products, we plan to reduce our GHG emissions by 30% in FY2030 compared with FY2019, putting us on a solid path to carbon neutrality.

As one specific initiative, the conversion of captive power plants to biomass co-fired generation is on track. Looking ahead, we will continue to expand the ratio of co-firing going forward. In addition, we are working together with the public and private sectors to study fuel ammonia for captive power generation as a decarbonization initiative. We also intend to contribute to the sustainability of the global environment and industrial society by establishing an environmentally-friendly business model that does not depend on fossil fuels.

To Our Stakeholders

My greatest responsibility as President and Executive Officer is to transform Tokuyama into a new company. Keeping up with the times, Tokuyama will continue to boldly pursue new fields and convey its unique value to industry and society. I believe this is the only way to earn the trust and meet the expectations of our stakeholders. We will promote aggressive management under a solid governance structure, aiming to achieve sustainable growth and maximize corporate value in the years to come.