Action to Implement Management that is
Conscious of Cost of Capital and Stock Price

SEKISUI KASEI CO., LTD.
(TSE Prime Code: 4228)
May 31, 2024

1I. Our Perception of the Current Situation▶ Our target for FY2030 is ROE of 8.0% or more (announced in January 2023)▶ Actuals for both ROE and PBR both remain at low levels (ROE of 1.9 %, PBR of 0.41× in FY2023)■ Main reasons for low PBRDelays in improving profitability, and low capital efficiency→ Issues are prompt improvements to unprofitable businesses, shift to growth businesses, and improvements in capital efficiency

ROEPBR

Trend of ROE tracking below cost of equity continues

Is both less than 1.0× and remains at an extremely low level(PBR 1.0×)(Cost of capital 7-8%)%

Fiscal year-end
share priceFiscal year-end
PBR (×)

×-9.3

yen2

II. Policies and Targets Aimed at Delivering Improvements
Targets FY2030: ROE of 8.0% or more, operating income ratio of 8.0% or more
FY2024: ROE of 1.5% or more, operating income ratio of 1.9% or more
FY2024 policy1) Growth strategy: Accelerate shift to high-profitability businesses, growth markets

2) Financial strategy: Build a stable financial position by improving capital efficiency
3) IR strategy: Enhance disclosure, expand constructive dialogue with investors* This year, in preparation for the next Medium-Term Management Plan starting in FY2025, we will undertake further
investigations and set various indicators and targets

Higher ROE
Achieve ROE higher than1) Growth strategy

2) Financial strategy

cost of equity

Reducecost of capital

Growth strategy+Financial strategy

Higher ROE

IR strategy( maintain PER )3) IR strategy
PBR improvement

3III. Direction of Initiatives
1. Growth strategy
Basic Approach

Accelerate shift to high-profitability businesses, growth markets*Strategies, indicators and targets will be disclosed again in the next medium-term management plan to beformulated this fiscal year.

(1) Speed up execution of measures to improve profitability
Drastic reforms of low-profitability businesses
Prioritize allocation of resources to high value-added businesses
Open up new markets, invest for growth, etc.

(2) Promote growth strategy that is integrated with sustainability strategy
Create competitive advantage through Sustainable Star Product* portfolio
Approach environmental regulations as an opportunity to develop new businesses, etc.
*Our environmentally friendly product bland is Sustainable Star Product.

(3) Reinforce our management foundations
Promote DX, SCM reforms
Strengthen human capital management, etc.

Expand in
5 business fields

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1. Growth strategy
Accelerate entry into growth markets using unique products that leverage our strengths
in order to raise profitability● Environmental and social issues

Growth markets

Global warming, climate change, marine waste problem, food loss problem, depletion of fisheryresources, PFAS regulations, falling birth rate and aging society, labor shortages, extension ofhealthy life, nursing care problem, natural disasters, aging infrastructure…

● Technological innovation
high-speed& high-capacity communication, CASE, foodtech, braintech, technology for using
natural energy…

Our strengths

Foaming/polymerization/nanoparticle/gelling technology,
integrated production from materials to processed products, global network

FoodDirection ofbusinessexpansion‣Materials for industrial-typeagriculture/fisheries‣Technology for retaining
freshness

Electronics‣ Functional materials(low-permittivity materials, etc.)

Mobility‣ Materials for reducing weight‣ Materials to absorb sound/insulate
heat

Medical/Healthcare‣ Remote medical equipment‣ Wearable devices

Housing/Energy‣ Disaster prevention/mitigation
construction methods‣ Materials for renewableenergy facilities

Sustainable Star Product (Environmentally friendly products)

2030 targets

Operating income of ¥13.0 billion, operating income ratio of 8.0%, ROE of 8.0% or more4

52. Financial strategy
Basic Approach

Build a stable financial position by improving capital efficiency*Strategies, indicators and targets will be disclosed again in the next medium-term management plan to beformulated this fiscal year

(1) Stable shareholder returns
・Dividend policy: Dividends are determined in accordance with the trend in consolidated results, and after taking acomprehensive view of the balance between dividend stability and internal reserves
・Dividend payout ratio: Target consolidated dividend payout ratio of 30-40%(2) Improve capital efficiency by making judgments concerning the effectiveness of assets
・Validate both growth investments and assets owned in terms of effectiveness and future cash flows(3) Reduction of strategic shareholdings
・Board of Directors to confirm meaning of holding positions at regular intervals, continue discussions on reductions(4) Improve efficiency of working capital
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・Enhanced functionality of SCM through promotion of DX → reduce inventories, speed up collection of accounts receivable

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3. IR strategy
Basic Approach

Enhance disclosure, expand constructive dialogue with investors*Strategies, indicators and targets will be disclosed again in the next medium-term management plan to be
formulated this fiscal year

(1) Enhance provision of IR information and dialogue
・Continue constructive dialogue with shareholders and investors (earnings results briefings, one-on-one meetings)
・Make video from earnings results briefings available on website, create pages for individual investors(2) Simultaneous disclosure in English
・Implement simultaneous disclosure in English of earning releases, briefing materials, and other timely disclosure materials(from April 1, 2025 onward)(3) Close the gap to investor expectations
・Share content of dialogue with investors and discuss in more depth on Board of Directors (quarterly/four times a year)
・Enhance information disclosure related to dialogue with investors(4) Convince investors of the likelihood of achieving targets for 2030
・Expand business growth scenarios and value (including non-financial) creation scenarios for 2030 (next medium-term
management plan, integrated report)