Revision of

2025 Mid-Term Management Plan

July 28, 2023

Santo-kun (Our mascot)

Outline of Mid-Term Management Plan

Business Environment

  • Resource price inflation

(decoupled from steel supply and

demand cycle)

✓Carbon Neutrality

✓Intensifying human resource

constraints

Five Core Pillars

Further enhance corporate value

and global presence

Reinforce profitability of all global operations

Strengthen ESG Initiatives

Achieve carbon neutrality

by FY2050

Promote DX

© 2023 Sanyo Special Steel Co., Ltd. All Rights Reserved.

2

Financial Targets and Investment of Resources

Financial Targets

Net sales

Ordinary income

ROE

ROE (excluding goodwill amortization)

Investment of Resources

CAPEX (FY2023 - FY2025)

Number of employees

(End of FY2025)

FY2025 Target

Approx. 420 billion yen

Approx. 22 billion yen

Approx. 7%

Approx. 8%

Approx. 16 billion yen/year

Approx. 6,500

Original plan

Approx. 280 billion yen

Approx. 14 billion yen

Approx. 5%

Approx. 6%

Approx. 12 billion yen/year

Approx. 6,400

© 2023 Sanyo Special Steel Co., Ltd. All Rights Reserved.

3

Reinforce Global Business Foundation

Enhance Resource Investment

CAPEX: Approx. 16 billion yen/year (←Original plan: Approx. 12 billion yen/year)

Number of employees: Approx. 6,500 (← Original plan: Approx. 6,400)

Proactive investments with focus on carbon neutrality (including energy saving) and DX. Securing necessary human capital globally.

Corporate Value

Reinforce Profitability

Consolidated ordinary income: 22 billion yen (← original plan: 14 billion yen)

Consolidated ROE 8% (excluding goodwill amortization) (←Original plan: 6%)

Encountering volatile demand trends and sustained cost push, we will continuously: a) amend sales price flexibly based on value-in-use, b) expand and enhance surcharge system; and c) upgrade sales mix.

Taking advantage of our progressive technology, we will firmly capture demand in the fields of "EV" "wind power generation" "high-speed railroad" and "hydrogen society".

Strengthen global business foundation and further enhance corporate value and presence

Sanyo (non-consolidated) will strengthen marketing competence responding to market segments and secure appropriate margins. OVAKO will continue reinforcing profit structure by optimizing cost and leveraging carbon neutrality advantage.

SSMI will expand presence in the growing Indian market by promoting cost improvement in procurement etc. and strengthening marketing competence through exploiting technical advantage.

Formed and fabricated materials business will further pursue profit growth by utilizing its global network.

Metal powder business will secure growth in highly profitable and advanced areas of 3D printers, semiconductor, DX and CN. Sanyo group will explore growth opportunities globally to further enhance corporate value and presence.

© 2023 Sanyo Special Steel Co., Ltd. All Rights Reserved.

4

Reflect ESG Indicators in Executive Compensation

ESG

Original

■ Consolidated ordinary income

Short-term performance incentives Medium-to-long-term performance incentives

■ ROE

Five additional

From July 2023

■ CDP score

indicators

■ Health management rating

■ Safety indicators

■ Ratio of female managers

■ Board effectiveness appraisal

by outside directors

Promote diversity

■ Further promote female managers

Ratio of female managers: 5.3% (end of FY2022) → 6.3% (end of FY2025) cf. industry average approx. 2%

■ Improve work-life balance

Usage rate of childcare leave: 80% or more for women, 50% or more for men (by FY2025 end)

■ Promote health management

Aiming "White Top 500 company*"

*Top 500 companies promoting health and productivity, certified by the Ministry of Economy, Trade and Industry

© 2023 Sanyo Special Steel Co., Ltd. All Rights Reserved.

5

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

Sanyo Special Steel Co. Ltd. published this content on 28 July 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 July 2023 05:44:48 UTC.