May 14, 2012
Tokuyama Corporation
Tokuyama Corporation Announces New Three-Year Management Plan
Tokuyama Corporation (hereinafter referred to as “Tokuyama” or “the Company”) announced
today its new Three-Year Management Plan (FY2012–FY2014), together with the review of theprevious Three-Year Management Plan.

1. Centennial Vision
February 16, 2008 marked Tokuyama’s 90th founding anniversary. Toward the centennial
anniversary of its founding, which will be celebrated in February 2018, the Tokuyama Group set
out its Centennial Vision. It defines the optimum form of the Group as “a manufacturing
company that exists in harmony with society and creates a better future with the vitality of its
human resources and the creativity of chemistry.” As a goal for the Centennial Vision, theCompany set up the numerical targets that included net sales of ¥500 billion or higher, operating
margin of 15% or higher, and overseas net sales ratio of 30% or higher.
2. Reflecting on the Previous Three-Year Management Plan and FY2011
Positioning the previous Three-Year Management Plan (April 1, 2008–March 31, 2011) as thefirst step to achieve the Centennial Vision, we promoted the Plan under our management policy“Venture Spirit & Innovation.” Although our efforts produced some positive results such as theexecution of the Malaysia Project and the restructuring of the Cement business, many issues
remain such as the delay in the creation of new businesses. In addition, our net sales and profits
were far short of the numerical targets of the previous Three-Year Management Plan mainly due
to the global economic crisis and the rapid shrinkage of domestic demand resulting from theeconomic recession.
To address such a situation, positioning FY2011 as the Year for Reformulation of Our Strategies
toward the Achievement of the Centennial Vision, we strove to accomplish the measures that wehad not completed under the previous Three-Year Management Plan and formulated the nextThree-Year Management Plan for the three-year period starting April 2012.
3. New Three-Year Management Plan
Positioning the new Three-Year Management Plan as the second step for Accelerating Our
Growth Strategies toward achieving our Centennial Vision, we will strive to promote growthstrategies and establish a support structure for such growth strategies. To create a flow that
accelerates growth, we will complete the Malaysia Project, restructure the Group’s businesses andstrengthen the organizational functions. In addition, we will further develop the results of ourendeavor under the previous Three-Year Management Plan and for FY2011 and accelerate ourinitiatives to address remaining issues such as the creation of new businesses, the nurturing ofhighly profitable businesses and the full utilization of the new information line of business(LOB) system.

Outline of the New Three-Year Management Plan
1. Period of the Plan
FY2012–FY2014
2. Framework of the Plan
(1)Execution of Growth Strategies①Strengthen Strategically Growing Businesses②Restructure Businesses in Which We Aim to Improve Profitability③Bolster Our International Competitiveness(2)Establishment of a Support Structure for Growth Strategies①Reinforcement of Business Execution and Supervisorial Functions②Adoption of Cross-Divisional Functions to Strengthen Our Functions③Measures to Address Globalization in Organization, Personnel Affairs and Accounting④Full Utilization of a New Line of Business (LOB) System⑤Establishment of a Structure That Can Fully Utilize Diverse Human Resources

3. Targets to Achieve by the Plan’s Final Fiscal YearNet sales: ¥375 billion
Operating margin: 7%
Overseas net sales ratio: 28%
Assumption:
Exchange rate: ¥80/US$Domestic naphtha price: ¥55,000/kl

CONTENTS
Ⅰ. Centennial Vision
Ⅱ. Reflecting on the Previous Three-YearManagement Plan and FY2011
Ⅲ. New Three-Year Management Plan

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Ⅰ. Centennial Vision
Centennial Vision“A manufacturing company that exists in harmony withsociety and creates a better future with the vitality of its
human resources and the creativity of chemistry.”

Management Policy “Venture Spirit & Innovation”

Basic Strategies“Strengthen Strategically Growing Businesses”“Bolster International Competitiveness”

Basic Strategies Support Structure“Human resource–based management”“Promotion of CSR activities”
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Ⅰ. Centennial Vision

Numerical Targets¥500 billion or higher
Net sales:
15% or higher
Operating margin:
30% or higher
Overseas net sales ratio:
Business Category
Strategically growing businesses

Growing Materials
Business
Polysilicon,
Fumed silica,
Shapal,Tokuyama Malaysia
Sdn. Bhd.,
Tokuyama Chemicals(Zhejiang) Co., Ltd. andothers

4Growing Components
Business
Fine chemicals,
A&T Corporation,
Tokuyama DentalCorporation,
Figaro Engineering Inc.,ASTOM Corporation,
NF and others

Businesses in which we aim to improve profitability

Foundation Business
Cement,Recycling andenvironment,
Soda ash and calcium
chloride,
Chlor-alkali and vinylchloride,
Shin Dai-ichi Vinyl
Corporation and others

IndependentComponents Business
Sun•Tox Co., Ltd.,
Excel Shanon
Corporation and others

Newbusinesses

Previous Three-Year Management Plan
Positioning of the previous
Three-Year Management Plan

- First step for our Centennial Vision with the catchphrase Venture Spirit & Innovation- Promote our growth strategies in line with the basic strategies of our Centennial Vision

Growth Strategies

Growth Strategy Support Structure

Further select and concentrate for aggressive
business expansion
 Create new businesses for us to win in the global markets
 Reinforce competitiveness by improving productivitySecure and optimally allocate management resources Nurture human resources who are highly capablefrom a perspective of global business Reinforce corporate governanceFY2010 Achievement Targets(Consolidated)
Net sales:¥370 billion or higher
Operating margin:
12% or higher
 Overseas net sales ratio: 22% or higher


FY2011
Positioning of FY2011 Year for reformulation of our strategies to realize our Centennial Vision5

Ⅱ. Reflecting on the Previous Three-Year Management Plan and FY2011

Growth Strategies

Actual Results
Expanded our polysilicon plant by 3,000 tons of capacity at the Tokuyama Factory, where theconstruction of a 1,800-ton plant also started
 Started the first and second phase construction of a polysilicon plant in Malaysia (20,000 tons in total)
 Reinforced our manufacturing bases in China (Tokuyama Chemicals (Zhejiang) Co., Ltd., andShanghai Tokuyama Plastics Co., Ltd., etc.)
 Restructured our Cement business (2-kiln structure, optimized logistics and sales structure) Withdrew from the thin-film sector of the Shapal business and concentrated on the AlN powder
and ceramics business Failed to achieve the previous plan’s growth strategy of converting to the solution proposal
business and establishing a high-profitability structure in the Growing Components Business andthat remains an issue to address in the next Three-Year Management Plan

Further Select andConcentrate forAggressive BusinessExpansionCreate New
Businesses for Us toWin in the Global
Markets

Reinforce
Competitiveness byImproving
Productivity

6Completed the VLD verification tests and the development of silane gas technologies
 Newly established a pilot plant for electrolyte membranes for fuel cells
 Started verification tests on single-crystal sapphire Failed to achieve the previous plan’s growth strategy of contributing to the profitability in thedevelopment field and that remains an issue to address in the next Three-Year Management Plan
Started to operate the new information LOB system (ISAAC), but failed to achieve the previous
plan’s growth strategy of fully utilizing the new system, which remains an issue to address in thenext Three-Year Management Plan
 Constructed the Shunan Bulk Terminal and started to operate part of it Established the South Combined Administration Building at the Higashi Plant of TokuyamaFactory

Ⅱ. Reflecting on the Previous Three-Year Management Plan and FY2011

Growth Strategy
Support Structure

Actual Results

Secure and Optimally
Allocate ManagementResources

Nurture HumanResources Who Are
Highly Capable from a
Perspective of GlobalBusinessReinforce Corporate
Governance7Integrated the Si Business Division and the Advanced
Materials Business Division, thereby establishing the Specialty
Products Business Division Newly established the Management of Technology Divisionand the Independent Business Management Division

Employed and started to nurture human resources as theMalaysia Project was launched Held the Asia Human Resources Development Meeting Increased the number of the Group’s overseas employees

Shifted to the executive officer system
 Installed an outside director

Ⅱ. Reflecting on the Previous Three-Year Management Plan and FY2011

FY2010 Achievement Targets and Actual Results (Consolidated)
FY2010
Actual Results

FY2011
Actual Results

FY2010
Achievement Targets¥289.7 billion¥282.3 billion¥370 billion or higher

Operating Margin

6.9%

4.9%

12% or higher

Overseas Net Sales Ratio

21.4%

19.6%

22% or higher

Item
Net Sales8Ⅲ. New Three-Year Management PlanPositioning

Second step for Accelerating Our Growth Strategies toward achieving ourCentennial VisionObjectiveTo create a flow that accelerates growth, we will complete the Malaysia Project,
restructure the Group’s businesses and strengthen the organizational functions

9Ⅲ. New Three-Year Management Plan

1 Growth Strategies [Strengthen Strategically Growing Businesses]
Expand the Polysilicon BusinessFor use in solar cells
Strengthen our cost competitiveness andexpand our share via the steady execution ofthe Malaysia Project

For use in semiconductors
10Reinforce our profitability by increasing ourproduction capacity and improving theoperational process at the Tokuyama FactoryFirst Phase Polysilicon Plant in Malaysia

Polysilicon

Polysilicon Plant at Tokuyama Factory

Ⅲ. New Three-Year Management Plan

1 Growth Strategies [Strengthen Strategically Growing Businesses]
Shift to the Customer-Oriented Solution Proposal Business
Develop and propose products that can solve customers’ problems
 Build an advantageous position through our close relationships with customers in global markets


Fumed silica

ShapalGeneric drugs

Photochromic materials

Microporous film

Create New Businesses
Quickly establish a technology for single-crystal
sapphire, materials for fuel cells and other materials
that we are developing and start related businesses Nurture and grow new businesses into sources ofprofits

11Single-crystal sapphire

Materials for fuel cells

Ⅲ. New Three-Year Management Plan

1 Growth Strategies [Restructure the Businesses in Which We Aim to Improve Profitability]
Restructure Our Businesses
Review our current business portfolio and restructure
our product profile and businesses
 Thoroughly rationalize our business by reviewing ourpurchasing, production, inventory, logistics and sales
value chains
Cement kiln

Become Competitive in New Fields
Become competitive in new fields such as newproducts, new businesses and overseas production
bases M&A is always an option
Caustic soda electrolyzer
12Ⅲ. New Three-Year Management Plan

1 Growth Strategies [Bolster Our International Competitiveness]
Production Bases in China
Manufacture locally compatible products (e.g., fumed silica
and microporous film) via the most suitable local method

Tokuyama Factory

Tokuyama Malaysia■Manufacture polysilicon and other efficient products tomaximize our cost competitiveness■Make Tokuyama Malaysia our manufacturing base of productsthat are competitive in Asian and other global markets

13Position Tokuyama Factory as our motherfactory and utilize the Factory as a supply baseof technologies, human resources and systems
 Innovate in the Factory’s process and engineering
technologies
 Reinforce our logistics function
 Formulate a long-term vision for the Factory’s
infrastructure and improve such infrastructure Promote the utilization of alternative fuels thatreplace coalⅢ. New Three-Year Management Plan

2 Growth Strategy Support Structure
New Management Structure for Faster Decision Making andStronger Business Execution and Supervisorial Functions
Adoption of Cross-Divisional Functions to Strengthen Our
Functions
Measures to Address Globalization in Organization, Personnel
Affairs and Accounting
Adoption of a New LOB System to Expedite Our Management
Decision Making and Improve Business Efficiency
Establishment of a Structure That Can Fully Utilize Diverse
Human Resources
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Ⅲ. New Three-Year Management Plan

3 Targets to Achieve by thePlan’s Final Fiscal Year

Targets to Achieve by the Plan’sFinal Fiscal Year (Consolidated)
Net sales：¥ 375 billion

Operating margin：

7%

Overseas net sales ratio ：28%

Assumption
Exchange rate : ¥80/US$
Domestic naphtha price : ¥55,000/kl

15＊Net sales and operating income by segment for FY2011 have been
calculated, reflecting the organizational change made on April 1, 2012.

Ⅲ. New Three-Year Management Plan

4 Injection of Management Resources
Three-year Capital Investments

Balance of Interest-Bearing Debt

¥192 billion (consolidated,three-year total)¥211 billion (non-consolidated, FY2013)16

Ⅲ. New Three-Year Management Plan

[Chemicals]

Priority measuresSuccessfully launch the liquid hydrogen businessReview our logistics and sales structure17

Ⅲ. New Three-Year Management Plan

[Specialty Products]
Priority measures(Billions of yen)Polysilicon・Nurture our polysilicon business for solar
cells as a pillar of profitability via the steady
execution of the Malaysia Project・Improve our brand power and profitability inthe semiconductor-grade polysilicon market
by increasing our production capacity andimproving the operational process of thepolysilicon plant at the Tokuyama Factory

Fumed silica

・Expand business in China
・Launch high-value-added products in the market
ShapalExpand our share in the power device market

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Ⅲ. New Three-Year Management Plan

[Cement]

Priority measures Launch new businesses in the field ofrecycling and environment
 Restructure our domestic commercial
distribution structure, for example, with thefunctional integration of our distributors

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Ⅲ. New Three-Year Management Plan

[Advanced Components]

Priority measures
Fine chemicals

・Launch active pharmaceutical ingredients(API) for generic drugs in the market
・Expand our share in photochromic materials

NF
Establish a disposable diaper supply andsales structure to accurately address theincrease in demandExcel Shanon Corporation
Restructure business to improve profitability

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Disclaimer

This material is supplied to provide information of Tokuyama and its
Group companies, and is not intended as a solicitation forinvestment or other actions.
This material has been prepared based on the information currently
available and involves uncertainties. Tokuyama and its Group
companies accept no liability in relation to the accuracy andcompleteness of the information contained in this material.
Tokuyama and its Group companies assume no responsibility
whatever for any losses or deficits resulting from investment
decisions based entirely on projections, numerical targets and otherinformation contained in this material.

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