U LT I M AT E
IN VACUUM

Management Planning Department
ULVAC, Inc.
2500 Hagisono, Chigasaki, Kanagawa Prefecture 253-8543, Japan
TEL. +81-467-89-2033 FAX. +81-467-82-9114

https://www.ulvac.co.jp/en/

Basic Corporate Philosophy/Management Policies

ULVAC’s Mission

ULVAC’s goal for 2050 is to become “a company that utilizes vacuum
technology to create value for the world with its partners and continues
to contribute to the future of people and the planet.”‘ULVAC’ is a combination of ‘UL’ from ‘ultimate’ and ‘VAC’
from ‘vacuum,’ signifying that we pursue the ‘Ultimate in
Vacuum Technology.’ In 1952, ULVAC was founded by a group

Vacuumof young people who aspired to contribute to Japan’s post-war
reconstruction and the development of industry and sciencethrough the use of vacuum technology. This aspiration led to

Basic Corporate
Philosophy

the creation of various types of vacuum technology equipmentthat played important roles in multiple fields ranging fromautomobiles and electrical appliances in everyday life to raw
materials and chemicals in industry. For the most advanced

The ULVAC Group aims to contribute to
the development of industries and science bycomprehensively utilizing its vacuum and peripheraltechnologies through the mutual cooperation andcollaboration of the Group companies.

industries, such as flat panel displays, semiconductors andelectronics, vacuum technology has become indispensable, andwe have grown by responding to changes in the prevailing wayof life. Our mission is to continue to create value for the world
and contribute to the future of people and the Earth throughvacuum technology.
In an era of change, we are never satisfied with the status

Management
Policies

quo but always embrace change, pursuing cutting-edge
vacuum technology together with our partners. We willcontribute to the realization of a sustainable society throughvacuum technology, ceaselessly striving to fulfill our social

Improve Customer Satisfaction
Innovations in Production Technology
Development of Original Products
Free and Open-minded Organization
Enhancing Corporate Value1

ULVAC VALUE REPORT 2022

responsibilities.

ULVAC VALUE REPORT 2022

2

ULVAC’s Vacuum Technology

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

TABLE OF CONTENTS
About ULVACULVAC’s Business Segments

Vacuum Technology,
ULVAC’s Core
Competence

Vacuum Equipment Business
Semiconductor and electronic device
production equipment
Semiconductor (memory, logic, power devices, etc.)
production equipment
Electronic device (MEMS, communication devices,
optical devices, etc.) production equipment
Electronic packaging equipment (WL-CSP, FoPLP, etc.)

FPD production equipment
LCD production equipment
OLED production equipment
Roll coaters (vacuum deposition, sputtering)

Components

Stated simply, a vacuum is a space where
the pressure is lower than the atmosphericpressure. A vacuum has fascinating properties:
for example, materials’ lower boiling points
in a vacuum mean they are more likely toevaporate and gas molecules can travel in astraight line in a space. ULVAC has developed
various application technologies that exploit theproperties of a vacuum in its quest to realize
the remarkable potential inherent in vacuum
technology.
For example, using vacuum technology, it ispossible to create ultrathin films with micronto-nanometer-order thickness. Since suchthin films cannot be produced by physicallystretching materials, advanced vacuum thin film
processing technology is required for depositing
layers of atoms or molecules of materials in a
vacuum.
Led by IoT, 5G, and AI, a tremendous wave oftechnological innovation is making the digitalsociety an everyday reality. Vacuum thin film
processing technology is destined to fulfill avital role for the fundamental technologies
underpinning the digital society.

Vacuum pumps
Vacuum gauges
Helium leak detectors
Process gas monitors
Power generators for deposition processes
Vacuum valves
Film deposition controllers
Vacuum robots

Vacuum heat treatment furnaces
Vacuum melting furnaces
Vacuum brazing furnaces
Rare-earth magnet production equipment
Vacuum freeze-drying equipment
High-vacuum distillation equipment
Micro powder dry
Automatic helium leak testers

Vacuum Application Business
Materials
Sputtering target materials
High-melting-point materials and production ofcomponents
Nano-metal ink

Other
Surface analyzers
Controllers
Mask blanks, etc.
Major Vacuum Equipment
equipment, etching equipment, ashing equipment, ion implantationequipment, annealing equipment, etc.

ULVAC VALUE REPORT 2022

ULVAC’s HistoryULVAC’s Global Reach
Consolidated Financial and Non-financial
Highlights

ULVAC’s Vision
11
15

Commitment of Top Management
ULVAC’s Value Creation

23

Feature 1

Process/Priority Issues/
Value Offered by ULVAC’s Businesses/
Research & Development and Global Expansion

Strengthening Research andDevelopment Capabilities
25

Feature 2

Vision 2032
27
31

ULVAC’s Sustainable Management
Mid-term Management Plan: Breakthrough2022

Business Strategy
35

Vacuum Equipment Business

40

Vacuum Application
Business

Industrial equipment

Sputtering equipment, vacuum evaporation equipment, CVD

3

5
7
9

41
45
49
51
53
54
55
60
61
62
63

69
71
73
77

Semiconductor
Production Equipment
FPD Production
Equipment
Industrial Equipment

Electronic Device
Production Equipment
Components

Materials
Other trengthening of FoundationS
for Value Creation
Corporate Governance
Messages from External Directors
Management Structure
Risk Management
Compliance
Human Rights
Human Resources
Occupational Safety and Health
Quality Assurance and Product Safety
Procurement
Environment

 inancial Data/Corporate
F
Information
11-year Financial Data
Financial Overview
Consolidated Financial Statements
Company Data/Stock Information

Editorial Policy
We publish the ULVAC VALUE REPORT as a summary of ourinitiatives in the past year to achieve sustainable growth andenhancement of corporate value, our medium- to long-term
vision, and our management approach.
We consider this report to be an important communication
tool to facilitate stakeholders’ understanding of our activities anddeepen dialogue with them.
Published:
November 2022 (Previous issue published in November 2021)
Guidelines Referenced:
The International Integrated Reporting Framework, theInternational Integrated Reporting Council (IIRC)
Guidance for Integrated Corporate Disclosure and CompanyInvestor Dialogues for Collaborative Value Creation (Guidance
for Collaborative Value Creation), Ministry of Economy, Trade andIndustry (METI)
ISO26000
Report’s Scope and Period
Scope: ULVAC GroupIn principle, this report covers the ULVAC Group; any portions
that cover only ULVAC, Inc. are indicated as such.
Period: Year ended June 30, 2022
(July 1, 2021 to June 30, 2022, FY 2021)
Some portions of the report include activities and initiatives from
July 2022 onward.
<Disclaimer>
Figures shown in tables and graphs in this report may not add
up to the indicated total because of rounding. Some figures
have been revised from previous years’ data because the scopeof reporting was expanded or calculating methods have beenchanged.

ULVAC’s Communication Tools
Summarized
ULVAC VALUE REPORT(Japanese and English version)

Securities
reportDetailed
Financial information

Business report

Corporate
governance report

Business resultspresentationmaterials(Japanese/English)

Sustainability(Website)Non-financial information

We endeavor to achieve the optimum information disclosure by making
various communication tools available to meet your needs.
To help you deepen your understanding of the ULVAC Group, ourcommunication tools range from statutory disclosure documentation
centering on information on financial closing to this report that offers
non-financial information, such as on social and environmental initiatives
indispensable for creating corporate value, in addition to information on
business activities, management strategies, and financial information.
Please also refer to our website for the latest information.

ULVAC VALUE REPORT 2022

4

About ULVAC

Introduction

ULVAC’s History

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

1952: Japan Vacuum Engineering Co., Ltd. was founded.

The story of ULVAC’s foundation
At the time when Japan was engaged in
post-war recovery, a group of talented
young researchers and engineers gatheredwith the aim of “contributing to the revivalof Japanese industry through vacuum
technology.” In 1952 six angel investors,
impressed by the passion of these visionary
young people, invested in the establishmentof Japan Vacuum Engineering Co., Ltd., theforerunner of present-day ULVAC.

ULVAC celebrates its 70th anniversary this year. Ever since its foundation in 1952, ULVAC has been contributing to
the resolution of social issues in each successive era by deploying its core state-of-the-art vacuum technology, andhas grown remarkably. ULVAC will continue contributing to the development of industry and science through thecomprehensive application of vacuum technology in accordance with the Basic Corporate Philosophy.

1952-1970

1971-1990

High economic growth period

Soughtinvestment

Japan Vacuum Engineering Co., Ltd.

First president
Great idea!
Through vacuum technology
let’s help create an affluent
future for the up-and-coming
generation.

Kohnosuke Matsushita
President of Matsushita
Electric Industrial

Yoshijiro Ishikawa
President of Keifuku
Electric Railroad

We will provide wholehearted
support to a company wishing toestablish the vacuum technology
business in Japan.

NRC
Equipment Corporation
U.S. vacuum equipment
manufacturer

1991-2010

Consult

Cooperation

I want to establish avacuum technology
company to help drive
Japan’s recovery.

Gen Hirose

President of Nissay

Tamesaburo
Yamamoto

President of Asahi Beer

Yoshio Osawa

Six investors

President of Osawa-ShokaiSecondpresident

Third president

Jin Imachi

Chikara Hayashi

Mazda ResearchLaboratory of ToshibaAiichiro Fujiyama

Chairman of Chamber of Commerce& Industry of Japan
President of Dainihon Sugar
Refining Company
Foreign Minister

Sagane Lab of the Universityof Tokyo

1941
Vacuum Club was
established.
*1950
Renamed Vacuum
Technology Association*Names of companies, organizations and titles are those at the time mentioned.

2011-Present

Information society, spread of digital home
appliances

Development of electronics

Fascinating!
Y’all must do it!

Each invested ¥1 million (equivalent to ¥25 million today) of their own money

Digital society

Industrial restoration and convenience in daily life

Comfortable working environment

High-performance devices

Sustainable future

Applied vacuum equipment to contribute to industries
supporting people’s lives

In line with increasing demand for semiconductors, a streamof ULVAC products gained top shares in the global market.

ULVAC grew significantly in line with the expansion of
the FPD market from Japan to South Korea and Taiwan.

Contributing to a wide range of fields by leveraging strengths as a comprehensive vacuum
manufacturer in line with the spread of mobile devices and the development of ICT

Customers’
products
Reflectors for automobiles

Pharmaceuticals

Special steel

LCD calculator display

Computer (Photo: Courtesyof IBM Archives)

Disks/discs (magnetic,
optical)Flat-panel display

Large flat-panel display

Electronic devices

Advanced semiconductor

Vacuum evaporation equipment
for general industries

High-vacuum distillationequipment for plasticizers

100 kg-class induction heattype vacuum melting furnace

Transparent conductive
film deposition equipment

Fully automated vacuum
evaporation equipment

In-line sputtering equipment
for magnetic disks

LCD production
equipment

Large LCD production
equipment

Electronic device
production equipment

Semiconductor
production equipment

OLED

ULVAC’ssolutions

Net sales

2004
Listed on the First Section of the Tokyo Stock
Exchange.
New buildings of the Head Office/Plant(Chigasaki, Kanagawa Prefecture) completed.

 he current logo wasTestablished in 2001.

Sales overseas*

Operating profit*

Used in the early 1950s

Established in 1963

Further growth through industryacademia collaboration

2018
Opened the ULVAC-Osaka
University Joint ResearchLaboratory for Future Technology
at Osaka University.
2021
Opened the ULVAC Advanced
Technology Collaborative
Research Cluster at Tokyo
Institute of Technology

Minor change in 1983

1969
Changed the company name in
English to ULVAC CORPORATION
to promote exports.
1983
Opened the Beijing
Office in China.

1968
Head Office/Plant
completed in Chigasaki,
Kanagawa Prefecture.

1972
Opened the Institute forSuper Materials as ULVAC’s
first research facility.

1952
Japan Vacuum Engineering
Co., Ltd. was founded.
Please see “The story of
ULVAC’s foundation” at upper
right for the background to
ULVAC’s foundation.

1960

2005
Established R&D basesin South Korea andTaiwan.

2015
Established the Future
Technology ResearchLaboratory.

2007
Opened the Chiba Tomisato
Plant for the development andmanufacturing of materials.

2011
Established the South
Korea Institute for Super
Materials in South Korea.

2022
U LVAC’s
70th anniversary

Results for FY 2021

Net sales: ¥241.3 billion
Ratio of sales overseas: 70%
Operating profit: ¥30.1 billion

1975
Established a subsidiary inNorth America as a base forexports to the U.S.

1955
Opened the Omori Plant inTokyo to start manufacturing
equipment in Japan.

1960

2001
Changed thecompany name to
ULVAC, Inc.

1982
Established asubsidiary in Taiwan.

1964
Established the first overseas
subsidiary in Hong Kong.

FY 1952FY 1952

1990
Opened the Fuji Susono Plant in
Shizuoka Prefecture, as a plant
dedicated to semiconductor
production equipment.

2003
Established a base forfull-scale production
and field support in
China.

OLED production equipment

1970

1970

1980

1980

1990

1990

2000

2000

2010

2010

2020

2020

*Sales overseas and operating profit only for FY 2004 onward are indicated.

5

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

6

About ULVAC

Introduction

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

ULVAC’s Global Reach
Across a wide range of industries, ULVAC is the source of numerous products and technologies that meet theneeds of our customers and the market. For FPD production equipment and semiconductor and electronic
device production equipment, which are ULVAC’s current mainstay businesses, many of our major customers arein East Asia. ULVAC is characterized by a high ratio of sales overseas, centering on East Asia.

We have a global R&D system to promote joint development in close proximity to the world’s leading companies
and advanced research institutions as well as a global support system to satisfy customers in every situation.
With regard to production, we are working to strengthen our manufacturing capabilities, optimize production
in light of business needs and regional characteristics, and enhance integration of the global supply chain andcollaboration, with a focus on East Asia.

Net Sales by Business Segment (Amount and %)Net Sales by Region (Amount and %)Vacuum Equipment
Business

Vacuum Application
Business

17% [¥41.2 ]83% [¥200.1 ]billion8% [¥19.3 ]34%

Materials

Net sales in FY 2021

¥241.3

Industrial
equipment

9% [¥20.8 ][¥4.7 billion]

70%

Other
Asia

Europe,North
America andelsewhere

12%[¥81.3 billion]

billion15%

28%

Components

13% [¥30.2 ]billion[¥35.3 billion][¥67.8 billion]

Net Sales by Business Segment

FPD production equipment*
Industrial equipment

Semiconductor and electronic device production equipment

Materials

TaiwanComponents

Other

Japan

¥241.3billion

South
Korea

China

163.4

173.9

179.2

241.3
220.7

192.4

185.4

183.0

Vacuum Equipment Business

100

0

2011

2012

2013

*Includes PV production equipment business up to FY 2018.

7

ULVAC VALUE REPORT 2022

2014

2015

2016

2017

2018

2019

2020

2021 (FY)37%[¥89.9 billion]

ULVAC’s Global Reach

3,037
11
25
5

1,618
15
15
1

754
3
6
2

587
6
6
1

Europe,North
Americaandelsewhere
141
3
9
1

3

1

1

1

0

0

4

1

1

1

1

0

4
2
4
4

3
2
1
3

1
0
1
1

0
0
1
2

0
0
0
0

0
1
1
1

Japan

VacuumApplication
Business

231.8

249.3

30%

[¥72.7 billion](Billions of yen)

196.8[¥9.5 billion]

Net Sales in FY 2021[¥29.2 billion]

Semiconductor
and electronic
device production
equipment

billion200

4%

FPD production
equipment

billionbillion2%

billionOther

9% [¥21.9 ]Ratio of Sales Overseas

Number of employees*1
Number of companies
Number of support bases
Number of R&D bases
Number of production bases
by business*2
FPD production equipment
Semiconductor and electronic
device production equipment
Components
Industrial equipment
Materials
Other

South
Korea

China

TaiwanOther Asia

Total

98
3
8
0

*1 The number of employees is on a consolidated basis (as of June 30, 2022). The number of bases includes non-consolidated subsidiaries and associates (as of
September 30, 2022).
*2 As for production bases, plants that produce items for more than one business are counted for each business.

6,235
41
69
10

ULVAC VALUE REPORT 20228About ULVAC

Introduction

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Consolidated Financial and Non-financial Highlights
Consolidated Financial Highlights

Non-financial Highlights

Net sales

Operating profit

ULVAC, Inc. (non-consolidated)(Billions of yen) 249.3
250

Rate of lost-work-time injuries

220.7
185.4

200

(Billions of yen)

241.3

36

183.0

35.4

2.0

30.1
23.8

27

150

1.5

16.0

18

1.66
1.02

17.2

1.83

0

1.95
1.20

2018

2019

2020

2021

(FY)

0

0.5

2017

2018

2019

2020

1.21

1.20

2.09

6.0

4.5

1.31

3.16
3.0

0.76

2021

(FY)

0.37

1.5

0.00

0.00

2018

2019

0

0.0

2017

Shareholders’ equity ratio(%)(Billions of yen)
40

60

35.9

30

20.2

18.7

20

10.8

14.8

10

0

2017

2018

2019

2020

2021

(FY)

ROE (Return on equity)

49.5

53.5

54.6

57.0

2020

2021

(FY)

100

87.8

82.4

79.4

5.0

15

25

2.5

2020

2021

(FY)

Interest-bearing debt

30

29.2

0

12.5
7.1

10

9.2

11.4

2017

2018

2019

60

75,000

39.5

35.6

39.5

50,000

2017

2018

2019

2020

2021

ULVAC VALUE REPORT 2022

2020

96,653

98,97135,09635,202

Group companies in Japan

2021

93,78190,934

92,052

34,27935,10536,4927,500 289

61,557

63,76959,50255,8295,000

55,560

286

(FY)

0

0

2017

2018

2019

2020

2021

(FY)

2,500

2017

2018

2019

2020

2021

(FY)

0

3.6

6,504

6,584

1,767

1,877

2017

(%)
6.0

4.5

3.6

163
4,987
2.6

2021

(FY)

Amount of valuable materials recycled (t)Amount of landfill (t)Total amount of waste recycled (t)Final landfill disposal rate (%)(t)
10,000Recognizing that electricity accounts for a large proportion of energy
consumption, we are promoting energy saving in production and productdevelopment and evaluation while introducing facilities with excellent
energy-saving performance.
For details
P.63

9

0

(FY)

25,000

20

0

2020

7.7

6.6

Waste emissions

100,000

35.7

(FY)

CO2 emissions

80

40

2021

We are making Group-wide efforts to actively promote women to
managerial positions with the target of “10% or more by June 2026”
and will implement human resources policies that take into consideration
the need for a working environment that is pleasant for women andmotivates them to seek promotion.
For details
P.55(t-CO2)

49.8

2020

Convinced it is preferable to appoint people of the respective countries
and regions to be in charge of management of overseas bases, wehave been fostering and promoting local managers and next-generation
executives while also promoting assignment of local employees to otherimportant positions overseas.
For details
P.55(Billions of yen)

20

2019

(%)
10.0

87.1

50

Group companies overseas

(%)

83.8

30

2019

2018

Ratio of women in managerial positions

7.5

2018

2017

Localization ratio of presidents of overseas subsidiaries

75

2017

1.97

We recognize that people are the source of sustainable value creationand our most important asset. Although the number of employees who
retired for personal reasons temporarily increased in FY 2021 owing to
the introduction of an early retirement system to support job changes,
we will continue to promote the retention of human resources throughvarious initiatives.
For details
P.55

45

0

1.98

1.06

ULVAC has been promoting various safety initiatives, including risk
assessment, through the operation of the Occupational Safety and HealthManagement System (OSHMS), resulting in safe workplaces that meetindustry standards. With “safety first” as the Group’s principle, we will
work to eliminate occupational accidents.
For details
P.60

(%)

53.3

2.21

0.39

*Source for average data for all industries and manufacturing industry: “Survey on
Industrial Accidents 2021” by the Ministry of Health, Labour and Welfare of Japan.

Profit attributable to owners of parent

ULVAC, Inc. (non-consolidated)

(%)

1.0

9

2017

Manufacturing industry*

1.80

100
50

Voluntary retirement rate

All industries*

2018

1,173

2019

80
4,936

93

3.0

1.4

4,426
1.4

1,136

1,189

2020

2021

(FY)

1.5

0

We are taking steps to reduce landfill disposal of waste and increase
the recycling rate while promoting resource-conscious manufacturing,
including design to reduce processing losses and minimize wastematerials.
For details
P.63
ULVAC VALUE REPORT 2022

10

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Commitment of Top Management

Taking on the challenge of creating and cocreating innovation with vacuum technology
at the core, with a view to a sustainable
future for people and the planet
Setsuo Iwashita
President and Chief Executive Officer

Pioneering the future with vacuum
technology, inheriting the spirit of
our founders
ULVAC was founded with the aspiration of“contributing to industry with vacuum technology”
at a time when Japan was engaged in post-war
reconstruction. We started manufacturing vacuum
equipment, which no one else in Japan could
manufacture at the time. Subsequently, by embracing
a succession of new technologies corresponding
to the changing structure of industries, we have
expanded our application fields to include chemicals,
pharmaceuticals, food, metallurgy, semiconductors
and electronic devices, and flat-panel displays,
opening up new markets. We have achieved growth
while supporting people’s lives with vacuum
technology, contributing to the business expansionof client companies and the advancement ofindustry and science, and celebrated ULVAC’s 70th
anniversary on August 23, 2022. I would like to takethis opportunity to express my heartfelt gratitude
to all our stakeholders for their support, which hasenabled our business to grow to what it is today.
Inheriting the spirit of sustainability that our
founders aspired to resolve social issues of the timethrough technology, the ULVAC Group will continue
to boldly take on the challenge of pioneering asustainable future for people and the planet withvacuum technology and continue to provide value as
an indispensable enterprise in the world.

Viewing social change as anopportunity for growth andexpanding the scope of our value
provision
In recent years, the business environment inwhich the ULVAC Group operates has changed
greatly owing to a series of changes that have
had a profound impact on society as a whole. The
inexorable trend toward digital transformation (DX)and greater use of information and communications
technology (ICT) is accelerating, due to factors suchas the normalization of remote working, the shift
to EVs and the growing use of AI. At the sametime, technological innovation is needed to reduce
the power consumed by semiconductors andelectronic devices, in order to achieve a green society
committed to worldwide decarbonization to mitigate
the adverse impacts of climate change.
Technological innovation that supports realizationof such a society requires technologies enablinglarge capacity and low power consumption ofsemiconductor memories and logic devices;miniaturization and enhanced performance of MEMS/
sensors and power devices; and higher resolution,
11

ULVAC VALUE REPORT 2022

lower power consumption, increased size and greater
flexibility of displays. ULVAC will respond to theseneeds by leveraging its strengths in vacuum thin film
processing technology and fundamental technologies
for equipment.

Orders received increased in all
businesses. Great increases in both
net sales and profit achieved
To summarize the business environment in FY
2021, in the semiconductors sector, the tempo ofinvestment by foundries and logic manufacturers inadvanced equipment was vigorous, and investment
in semiconductor memories remained at a highlevel. In the electronics sector, investment in various
electronic devices for the realization of a digitalsociety expanded in line with the spread of 5G andinvestment in power devices also grew in line withthe ongoing shift to green energy and EVs. In theflat-panel display (FPD) sector, investment in liquid
crystal displays (LCDs) for tablets, PCs, and IT panels
for automotive and other applications increased,
and moves responding to the transition from LCDs
to organic light-emitting diode (OLED) displays
continued.
In this environment, the ULVAC Group received
orders greatly surpassing the level for the previous
fiscal year and achieved significant increases in both
net sales and profit, exceeding the initial targets.
Regarding FPD production equipment, in particular,orders received increased significantly in response
to growing investment in LCDs and OLEDs, with net
sales growing markedly from the previous fiscal year.
Regarding semiconductor production equipment,
orders received increased for both logic and memory,reflecting greater use of the Metal Hard Mask (MHM)
process and a continuing high level of investment,
respectively. Regarding electronic device production
equipment, both orders received and net sales
increased, because business negotiations in China
with a view to increased production of electronics inthat country progressed while investment in powerdevices and various electronic devices became brisk.
Components, industrial equipment, and materials
also performed strongly. As a result, orders received
for FY 2021 exceeded the levels for the previous
fiscal year for all businesses.
In terms of profit, the gross profit margin reached30.6%, the highest level since the listing of theCompany on the stock exchange. This was due tothe progress achieved in improving the profit margin
by strengthening manufacturing capabilities and theincrease in net sales, despite the impact of higher
prices of parts and materials and longer procurement
lead times. The operating profit margin was 12.5%,
up 3.1 percentage points from the previous fiscal
year.

ULVAC VALUE REPORT 2022

12

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Commitment of Top Management

As a result, for FY 2021, on a consolidated basis,
orders received increased 35.8% year on year to¥270.1 billion, net sales increased 31.8% to ¥241.3
billion, operating profit increased 74.8% to ¥30.1
billion, ordinary profit increased 79.2% to ¥32.2
billion, and profit attributable to owners of parent
increased 36.3% to ¥20.2 billion.

Strengthen growing businesses
and improve profitability byenhancing manufacturing
capabilities
The current mid-term management plan,“Breakthrough 2022” (covering the period from FY
2020 to FY 2022), is now in its final year. Initiatives
under the mid-term management plan with“investment in development for growth (selection
and concentration)” and “profit-oriented management
through structural change” as the basic policies
made good progress in the past two years, achieving
business growth and improved profitability.
Regarding semiconductor production equipment,in the logic field, ULVAC is outperforming market
growth owing to an increase in demand for MHM
equipment attributable to EUV-related investment aswell as the securing of new customers and increased
opportunities for entry into other processes. In thememory field, we also maintained a high level oforders received, not only for conventional processes
but also for entry into other processes. Thus, thesemiconductor production equipment businessachieved growth in both the logic and memory fields.
Regarding electronic device manufacturing
equipment, investment in power devices and opticaldevices is accelerating in Japan and China. Especiallyin China, in response to the government’s policyemphasizing domestic production, construction offactories increased, primarily in coastal provinces.
Capturing such demand, the Group continues
to achieve high growth. We expect demand forelectronic device production equipment in FY 2022
to grow to 1.9 times the level recorded before thelaunch of the current mid-term management plan (FY2019).
Regarding FPD production equipment, the shift
from LCDs to OLEDs is progressing, buoyed by thetrend toward more active investment in IT panels.
In FY 2021, we were able to capture the surge in
LCD investment, thus securing high orders received.
Going forward, we will focus on expanding sales of
sputtering equipment for large-substrate OLEDs in
response to the full-scale shift to mass production of
OLEDs. At the same time, we have begun receiving
orders for evaporation roll coaters to realize smallersized and larger-capacity EV batteries offeringenhanced safety, and we aim to increase orders
going forward.
While active investment in technologicalinnovation and increased production is expectedin the medium to long term in the semiconductor,
electronic device, and FPD fields, ULVAC is focusing
on research and development to strengthen its
growing businesses targeting these areas so as toincrease orders received. Under the current midterm management plan, ULVAC will continue tostrengthen its initiatives to improve profitability byenhancing manufacturing capabilities. To improve
productivity, we are reforming our engineering &design, production process, and procurement tostrengthen the information system infrastructure. As
a result, the gross profit margin improved from 27.3%
to 30.6% over the past two years and is improving
even in an environment affected by longer delivery
lead times and rising prices for parts and materials. In
July 2022, ULVAC, Inc. merged with ULVAC TOHOKU,
Inc. and ULVAC KYUSHU CORPORATION throughabsorption-type mergers. By integrating the two
production subsidiaries’ manufacturing expertisewith the expertise of the head office in development
and design, ULVAC put in place a structure foraccelerating enhancement of manufacturing
capabilities. From now on, we intend to strengthen
the global cooperation system by coordinating the
supply chains we have established in each region,
including overseas plants.

Expect to maintain a high level oforders received and increases in
net sales and profit
In FY 2022, the final year of the current mid-term
management plan “Breakthrough 2022,” while, as
mentioned above, active investment for technologicalinnovation and increased production is forecast
for semiconductor, electronic device, and FPD

13

ULVAC VALUE REPORT 2022

production equipment businesses, ULVAC expects tomaintain a high level of orders received. Although we
expect the impact of longer delivery lead times andhigher prices for parts and materials to continue forthe time being, we will work to enhance both growthpotential and profitability by strengthening researchand development and enhancing manufacturing
capabilities to respond to the risks.
Based on these predictions, for FY 2022, on aconsolidated basis, we forecast orders received of¥270.0 billion (on a par with FY 2021) and increases
in both net sales and profit. Plans call for net sales of¥250.0 billion (+3.6% year on year), operating profitof ¥34.5 billion (+14.6%), ordinary profit of ¥35.5
billion (+10.2%), and profit attributable to ownersof parent of ¥23.0 billion (+13.8%). As a result, thegross profit margin is expected to be 33.0% (animprovement of 2.4 percentage points) and theoperating profit margin 13.8% (an improvement of 1.3
percentage points).
Capital policy
Regarding the capital policy, we take into accountsuch factors as financial soundness, the capital
structure, and distribution of profit to shareholders,
while securing capacity for growth investment witha view to future needs. ULVAC recognizes that thesharing of profits with the shareholders as one of its
most important policies. On the other hand, ULVAC
operates in an industry characterized by technologicalinnovation and fluctuating capital expenditure, andintends to enhance its internal reserves to securesufficient funds for R&D investment in growth fields
and establish a stable financial base.
With regard to returning profits to its shareholders,
ULVAC’s dividend policy is to focus on linkage withbusiness performance and to aim at achieving a
consolidated dividend payout ratio of 30% or more.
Taking these factors into consideration, it was
decided to pay a year-end dividend of 124 yen per
share for FY 2021.

What our vision and materiality forthe next 10 years aim to achieve
As the world faces various issues of increasing
gravity, such as the continuing COVID-19 pandemic,
extreme weather events and natural disasters
attributable to climate change, increasing geopoliticalrisks, and supply chain disruptions, we need toreaffirm the role that ULVAC should fulfill in theinternational community and pursue sustainability of
ULVAC and simultaneously that of the planet. In orderto further practice sustainable management, taking
the opportunity of the 70th anniversary of ULVAC’s
foundation, we have set our vision of where we want
ULVAC to be 10 years from now on the path to ourgoal for 2050. ULVAC’s vision for 2032 is to continue
to be a “Field of Potentiality” for the future and wehave identified the materiality to realize this vision.
In doing so, we focused on the uniqueness thatdifferentiates ULVAC from others and enhancementof economic, social, and environmental value,
while also taking into account the Basic Corporate
Philosophy.
The term “Field of Potentiality” alludes to themargin of each person’s mind. Having an empty
space in one’s mind allows one to look to the outside
world and absorb more from it. Using the knowledge
thus gained, one can venture into the unknown andcreate the new, transcending preconceived ideas
and images. We believe that the ULVAC Group,
where passionate people gather, can be a “Fieldof Potentiality,” a source of innovation contributing
to resolution of global issues and technologies andproducts offering true value through co-creation withpeople connected to the ULVAC Group. Therefore,
we placed “promotion of creation and co-creationof innovation with vacuum technology at the core”
and “development of diverse human resources
and promotion of their advancement; cultivation ofresilient organizations” as key issues of materiality.
With a challenging mindset that aims to shift froma business that responds to customers’ requests
to one that proposes creation of new value forcustomers and society, we will create innovation
through joint development with customers andco-creation with various companies, universities,
research institutions, and other organizations.
Furthermore, we aim to create new businesses
and markets with next-generation technologies
with vacuum technology at the core. In order toachieve these goals, it is essential that we look to
the future, transcend national boundaries, think fromthe perspectives of the planet, society, markets,and customers, develop globally competent humanresources with flexible ideas, and transition froma traditional organization, system, and values to anautonomous, self-driven organization with a highdegree of mobility and adaptability.
Respect for human rights and responsible behavior
in the value chain are also important issues for the
ULVAC Group as it has a high percentage of overseas
sales and employees. As a comprehensive vacuum
product manufacturer, ULVAC is also committed tocontributing to a sustainable global environment byworking toward a decarbonized society and a circular
economy.
We encourage our stakeholders to look forward to
ULVAC’s further enhancement of corporate value, andask for your continued support over the long term.

ULVAC VALUE REPORT 2022

14

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

ULVAC’s Value Creation <Process>Through implementation of the Basic Corporate Philosophy stating that the ULVAC Group aims to contribute to
the development of industry and science by comprehensively utilizing its vacuum and peripheral technologies,
ULVAC aspires to be an enterprise indispensable for society.

Our Goalfor 2050

A company that utilizes vacuum
technology to create value for the world
with its partners and continues tocontribute to the future of people andthe planet

Vision 2032

Continue to be a “Field of Potentiality”
for the Future
P.25

Intellectual Capital
Number of patents owned*1

Manufacturing
CapitalSocial Issues

Principal production bases*1
Japan:
Overseas:

Financial Capital

Progress of digitalization

13
11

Shareholders’ equity*1¥189.0 billion

Establishment of network
infrastructure

D/E ratio*1

0.21

 nvironmental issues,Esuch as global warming
and climate change ood safety andFsecurity, population
explosion and sharp
increase in demand
for food in emerging
countries
Increase in food loss

Surfaceanalysis

1,435Longevity

Aging of infrastructure indeveloped countries

Human
RightsP.54

Initiatives

Value creation by leveraging a global network
Contribution to realization of a sustainable society
through products and services
Strengthening research and development capabilities
Strategic utilization and strengthening of intellectual
property

ESG

Industrial
equipment
Components

VacuumEquipment
Business

Semiconductors
Electronics

Foundation for Value Creation
Human
Resources

P.55

SocialContribution
Quality
Occupational
2
Assurance
Environment Activities*
Safety andandProduct
Procurement
WEB
HealthSafetyP.63

P.60

Construction, social
infrastructure, mobility

Materiality

Development of diverse human resources andpromotion of their advancement; cultivation ofresilient organizations

Initiatives

 trengthening of the management foundation andSenhancement of financial performance
Development of global human resources and promotionof their advancement
Diversity & inclusion
Health and productivity management
Workstyle reformCorporate governance and management structureComplianceRisk management

P.62

P.61

 ider gap between richWand poor

Basic Corporate
Philosophy

P.41

P.1

The ULVAC Group aims to contribute to the development of industries and science bycomprehensively utilizing its vacuum and peripheral technologies through the mutual
cooperation and collaboration of the Group companies.

P.27
ESG

Promotion of creation and cocreation of innovation withvacuum technology at the core
Development of diverse humanresources and promotion of
their advancement; cultivation ofresilient organizations
Respect for human rights andresponsible conduct in the value
chain

Contribution to a sustainableglobal environment

Materiality
Initiatives

ESG

ULVAC VALUE REPORT 2022

Respect for human rights and responsible
conduct in the value chain
Human rights
Quality management and product safety
CSR procurement
Occupational safety and health
Local contribution

Shareholders
and investors
Realization of longterm growth andenhancement ofcorporate value, andgreater returns

Achievement of growth
together with ULVAC
based on trust andcollaboration, fairand free competitiveenvironment

Local
communities

S

Materiality

Contribution to a sustainable global environment

Initiatives

Addressing climate change
Environmental management
Environmentally friendly products (Green Products)
Research and development of products and services
such as manufacturing equipment for low-powerconsumption devices, power devices, lithium-ion
batteries, etc., that contributes to innovation ofenvironmental technology and promotion of low-power
consumption of products

ESG

Customers
Contribution tocustomers’ businessactivities, technologicalinnovation, and value
creation; offeringof cutting-edge
production technology,enhancement of
productivity and quality,
and reduction ofenvironmental impacts
through equipment andservices

Suppliers

SDGs

Website>>Sustainability>Social Contribution Activities

Value ULVAC
Offers to
Stakeholders

G

SDGs

SDGs

15

ESG

SDGs

Equipment

Corporate GovernanceManagement Structure*2 For details

Promotion of creation and co-creation of
innovation with vacuum technology at the core

Materiality

Development of industrial
infrastructure in emerging
countries*1 As of June 30, 2022

Materiality

Energy management,
next-generation energy

thousand m3

 eeds and progress ofNhealth promotion andhealthcare

Realization of the digital society,fundamental technology forrealization of the digital society

FPD

Electricity consumption
thousand kWhContribution to realization ofa sustainable society*3

P.17

Healthcare, life innovation

Natural Capital

Water consumption

Value Creation

Priority Domains

Services

VacuumControl
Analysis

persons

Customer-oriented
development, design,
procurement,
manufacturing, sales,and service
capabilities

VacuumApplication
Business

Equipment
control

168,152

6,235

Customer
supportAdvancedmaterials Materials

Social Capital
Participation in consortia
and collaboration with
universities and otherinstitutions
Relationships of trustwith customers andbusiness partners
worldwide

Number of employees*1

R&D and capital expenditures

Coatingbusiness¥39.5 billion

Advances in 5G and IoT

Human Capital¥16.9 billion

Interest-bearing debt

 lobal energy issuesG
due to dependence on
finite resources

2,263
Overseas: 2,527
Japan:Creation of employment
opportunities, industrial
development, reductionof environmental
impacts

Employees
Workplaces offering job
satisfactionE*3 Indicates relationships with the United Nations’Sustainable Development Goals (SDGs).

ULVAC VALUE REPORT 2022

16

ULVAC’s Vision

Introduction

ULVAC’s Value Creation <Priority Issues>

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

We are committed to realizing a society that is not only safe and secure but also affluent and convenient byoffering value utilizing vacuum technology, which is indispensable and fundamental for industrial and scientificdevelopment.
We will continue helping to resolve social issues in cooperation with our customers through the provision of
products and solutions to them.

ULVAC’s business activities
Social issues

Progress of digitalization,
advances in 5G and IoT, andestablishment of network
infrastructureMarket opportunities

Aspiration for the progress of
all industries and technologicalinnovation
Diversification of semiconductor
and electronic device
applications and needs
Trend toward devices that aresmaller, faster, larger-capacity
and consume less power

ULVAC’s six businesses
Priority domains

Realization of the digital society
Autonomous driving, agriculture, healthcare,virtual currency, etc.

Fundamental technology forrealization of the digital society
IoT, cloud, AI, robots,
big data, drones

Environmental issues, such as
global warming and climatechangeGlobal energy issues due todependence on finite resources

Progress of renewable and lowcarbon energy systems
Improvement in energy
conversion efficiency

Food safety and security,
population explosion and sharp
increase in demand for food in
emerging countries, increase infood loss
Longevity, needs and progressof health promotion andhealthcare

Longer preservation of foodand pharmaceuticals, volume
reduction

Aging of infrastructure indeveloped countries
Development of industrial
infrastructure in emerging
countries
Wider gap between rich andpoor

Development of safe, secureand convenient infrastructure

Semiconductor
production
equipment

Electronic
deviceproduction
equipment

FPD production
equipment

Components

Industrial
equipment

See

See

See

P.35

P.38

P.40

See

See

P.36

P.37

See

P.39

Construction, social
infrastructure, mobility

Customers and their products

Response to new
semiconductor andelectronic device
fields and needs byapplying vacuum
deposition andother technologies
and R&D of cuttingedge processes
through co-creation
with customers

FPD, semiconductor, electronicequipment, and device manufacturers
Semiconductors:
Memory, logic

Contribution toresolution of principal
social issues*

Contribution to realizationof an advanced, convenient,safe and secure, digitalsociety

DRAM, PCRAM,
3D-NAND, CPU, etc.

Functional
devices: Sensing,communication(5G), display
MEMS, SAW/FBAR
devices, LCD,
OLED, etc.

Energy management, nextgeneration energy

Healthcare, life innovation

Materials

Main value
offered by thebusiness

Enhancement of
performance of
solar cells andpower devices byvacuum deposition,ion implantation andother technologies,
contribution to
reduction of power
consumption ofvarious devices

Solar cell manufacturers, battery
manufacturers, etc.

Longer life andvolume reductionof freeze-dried
food, vaccines,
drugs, etc. byvacuum freeze
drying and othertechnologies

Food manufacturers, pharmaceuticalmanufacturers, etc.

Enhancement of
performance ofindustrial materials
and response to
new materials byapplying vacuum
heat treatment andother technologies

Chemical and materials manufacturers,
steelmakers, transportation equipment
manufacturers, etc.

Energy: Heatgeneration,
power storage,
conversion

Contribution to creation ofa sustainable society bypower generation, energy
storage and energy saving

Solar cells, secondary
batteries (lithium ion
batteries etc.), powerdevices, magnets for windturbines, etc.

Foodstuffs,
pharmaceuticals:
Freeze drying
Freeze-dried
foods, emergency
provisions,
supplements,
vaccines, etc.

Industrial materials:
Heat treatment

Contribution to human health,the future of medicine, andrealization of a sustainable
society with minimal food loss
by means of safe and secure
foods and pharmaceuticals

Contribution to creation ofa sustainable society thatis safe and secure andcomfortable

Glass building
materials, industrial
materials, materials
for transportationequipment, heatexchangers, etc.

*Indicates relationships with the United Nations’ Sustainable Development Goals (SDGs).

17

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

18

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

ULVAC’s Value Creation <Value Offered by ULVAC’s Businesses>

Here & There,
Near your side

The ULVAC Group’s Basic Corporate Philosophy states, “The ULVAC Group aims to contribute to thedevelopment of industries and science by comprehensively utilizing its vacuum and peripheral technologies.”
As ULVAC manufactures production equipment, the general public rarely see our products. But the products
produced using vacuum technology and equipment are integral to people’s daily lives.
With our vacuum technology, we will continue to be a company needed by society.
Semiconductor

ULVAC’s Vacuum Technology
AI

Hospitals

Artificial intelligence (AI) made possible byadvanced, high-speed information processing
technology is expected to overcome labor
shortages, improve operational efficiency, andincrease the value provided to customers. Vacuum
technology is used in the production of thesemiconductors and electronic devices that
support this innovation.

Development of
IoT technology has
improved access to
medical care. Highquality telemedicine
using high-definition
displays is becoming
available. Vacuum
technology is also
used to meetgrowing medical
needs, such as for
vaccine production
and R&D of sterile
pharmaceuticalproducts.

Data Centers

Electric
Vehicles19Wind Power
Generation

Semiconductor
Electronic Device
Components
Materials

Electronic Device Electronic Device
Components

Smart
Home

FPD
Industrial Equipment
Components
Materials

Components

Semiconductor

Industrial Equipment

Electronic Device

Components

Components
Materials

Semiconductor

DronesFPD
Components
Materials

The aging of infrastructure in developed countries and the need forindustrial infrastructure in emerging countries are issues that demandattention. Vacuum technology is key to improving the performance of thevacuum circuit breakers in power receiving and transforming facilities,
heat exchangers of air conditioning equipment, and other equipment toensure safety, security, and efficient maintenance.

Industrial Equipment
Components

Solar Cells

Materials

Smart homes leverage
IoT, AI, and othertechnologies to achieve
greater comfort andconvenience. In view of
their advantages, they
are expected to spread.
Vacuum technology isused in the productionof the semiconductors,
electronic devices,and displays that makesmart homes possible.

Freeze-dried
Foods/
Supplements

Electronic Device

FPD

Production Equipment

Renewable energy has a low impact on the
global environment and is not depleted.
Wind power generation is a major
renewable. Vacuum technology is used in
the production of the power devices andhigh-performance magnets applied inwind turbines.

Electronic Device

Demand for data centers
is surging in response toexpanding data flows, as
teleworking spreads andneeds for big data storage.
Vacuum technology is usedin the production of thesemiconductor memories,
logic devices, power devices,and electronic devices
indispensable for data centers.

ULVAC VALUE REPORT 2022

Industrial Equipment Industrial Equipment

Semiconductor

In pursuit of carbon neutrality, the transition
to non-gasoline-powered vehicles is
accelerating as the world seeks to reduce
driving-related CO2 emissions. Vacuum
technology is used in the production of
power devices, electronic devices, highperformance batteries, high-performancemagnets, and other parts at the heart of EVs
and other electric vehicles.

Vacuum Circuit
Breakers

Semiconductor
Production Equipment

FPD Production
Equipment
Materials

Semiconductor
Electronic Device
Industrial Equipment
Components
Materials

Semiconductor
Electronic Device
FPD
Components
Materials

The need to reducefood waste and foodloss has become apressing issue, in viewof global shortagesof food. Vacuum
technology is used in
the food processing
industry to freeze dryfood products andproduce nutritional
supplements.

The use of drones in smart
agriculture is attracting attention
nowadays, not least as a way ofcompensating for labor shortages
in the agricultural sector. Vacuum
technology is used in the productionof the semiconductors, electronic
devices, and batteries essential for
drones.

Solar power generation is a mainstay form of renewable energy andis playing an increasingly important role in the energy mix. Vacuum
technology is used in the production of the control power devices
applied in solar power generation systems.

Semiconductor
Electronic Device
Components
Materials

Electronic Device
FPD
Components
Materials

ULVAC VALUE REPORT 2022

20

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

ULVAC’s Value Creation <Research & Development and Global Expansion>
Research and Development

Global Network

Ongoing value creation from a medium- to long-term perspective

Networks offering solutions to support industrial development worldwide

ULVAC has long been a source of vacuum-technology-based products and materials indispensable for wideranging industries. Building on our strengths in vacuum technology, we will continue to promote innovative,
pioneering R&D capable of addressing actual and potential needs and create high-added-value products andtechnologies, thus contributing to the progress of society.

ULVAC has established optimal networks covering development, sales, manufacturing, and services not only
for Japan but also for East Asia. To spur development by capitalizing on the global development system,ULVAC is promoting joint development with leading companies and research institutions around the world.
Japan

To continue to provide innovative technologies andproducts in the ever-changing market, our R&D projects
undergo selection and focus in which a clear distinction
is made between “development of innovative technology
for principal products of the mainstay business”
and “development of fundamental technologies in
preparation for the future” based on analysis of customer
needs and market trends. Moreover, our development
structure leverages business partnerships with various
companies and research institutions.
We are also laying the foundation for long-termsustainable growth underpinned by the latest
technologies.
Specifically, we will endeavor to respond swiftly tothe progress from 5G to 6G and IoT in line with theproliferation of global network infrastructure and theemergence of the digital society while flexibly addressing
social issues, such as global warming and climatechange.

TOPICS
Relevant SDGs

Established ULVAC Advanced Technology
Collaborative Research Cluster at Tokyo Instituteof Technology

Advanced logic
NAND/DRAM• Next-generation non-volatile memory• Next-generation displays• Next-generation batteries• Communication devices• Power devices• Electronic devices (MEMS)• Electronic packaging• Optical devices••

Kyushu Plant

Fuji Susono office Tohoku Plant

China

South Korea

TaiwanFor details

On September 22, 2021, ULVAC, Inc. and Tokyo Instituteof Technology (hereinafter “Tokyo Tech”) established the
ULVAC Advanced Technology Collaborative Research Cluster(hereinafter the “Collaborative Research Cluster”) on the
Ookayama Campus of Tokyo Tech. ULVAC and Tokyo Tech haveachieved results through ad hoc research cooperation, but tofurther strengthen the collaboration between the company andthe university as partners at the organizational level, we set
up the Collaborative Research Cluster with the support of theTokyo Tech Open Innovation Platform.
Combining Tokyo Tech’s plasma diagnostics technology
and AI technology, the Collaborative Research Cluster aims
to improve the performance of plasma processing equipment
by measuring plasma conditions that could not be measured
previously. The synergy created by laboratories from different
fields working together is expected to produce new research
results that cannot be obtained through ad hoc collaborative
research. Additionally, leveraging this organization-toorganization collaboration will lead to a wide range of positive
outcomes, not only in joint research but also in fields suchas personnel development, leading to future growth of bothULVAC and Tokyo Tech.

Principal themes

Head Office/Plant

Suzhou Plant

Hyeon-gok Plant Tainan Plant

R&D investment (single year)
R&D Capital Investment

R&D expenses

25.4
20

0

21

17.3

25.7

18.8

8.1

12.1

2011-20132014-2016

ULVAC VALUE REPORT 2022

18.9
2017-201928.7
20

2020-2022(Initial plan)

10

36.3
2020-2022(Revised plan)0(FY)

Mining of materials
for products

27.8

30

25.0

26.4

After refurbishing

Sales ofrefurbishedusedmachines

Field support(maintenance)

Sales ofparts and
consumables

Precisioncleaningand surface
treatment

Effective utilization of resources throughout the product life cycle
and addressing environmental issues
Relevant SDGs
Initiatives for enhancementof equipment recyclability
and production technology
improvement

Modification and improvement ofequipment and machines already inoperation, reduction of power consumption,
maintenance that also covers components

Procurement of parts andconsumables

ULVAC’s plants

R&D expenses(Billions of yen)
40

65.0

30.9

Website>>Support>Service Center

Website>>NewsFor details

R&D Capital Investment40

For details

On-siteRemoteBefore refurbishingR&D investment (3-year total)

44.6

Website>>Support>Sales Offices

Our customer support network in Japan and around the world underpins our customers’ production
operations in a manner that meets their needs throughout the product life cycle. We offer comprehensive
maintenance services covering components and make proposals for modification and improvement.
Furthermore, by using information on customer needs as feedback for the development of new equipment,
we aim to offer even more sophisticated vacuum technologies and services. We will also expand remotecustomer support packages utilizing IoT equipment.

¥65.0 billion in R&D investment (R&D Capital Investment and R&D expenses) is planned centering on semiconductor and electronic device
production equipment, which is a growing field, for the three years covered by the mid-term management plan.

51.4

For details

ULVAC’s customer support solutions pool the Group’s know-how

TOPICS

60

P.33 Mid-term Management Plan “Enhancing Manufacturing Capabilities”

Customer Support

Modification/
improvement

Progress in R&D Investment(Billions of yen)80

In regard to manufacturing, ULVAC has expanded a production
system centering on Japan, China, South Korea, and Taiwan. Goingforward, we will emphasize improvement of production efficiency
by further promoting optimal production. Each site of the ULVACGroup has established its own local supply chain. In addition, the
ULVAC Group is reestablishing a global supply chain to optimize
procurement.

15.3

16.9

8.4

10.3

6.9

6.6

2020

2021

12.8

15.0
2022

(FY)

ULVAC is contributing to reductionof power consumption, waste,and consumption of raw materials
throughout the product life cycle,
including the customer support
phase.

Customers’ plants

Modification and improvement of equipment,
sales of refurbished used machines
Refurbishing, precision cleaning,
and resource recovery(extension of component life and the cleaning cycle,
recovery of valuable materials, etc.)(Estimate)

ULVAC VALUE REPORT 2022

22

Feature

1

Strengthening Research

Equipping ourselves with advanced technologies that enable us to swiftly address social
issues is critically important for ULVAC’s sustainable value creation. We will further
promote initiatives aimed at achieving innovation and co-creation with various companies
and research institutions.

A Field of Potentiality for the Future– Integration of Plasma Diagnostics Technology and AI Technology
Many of the vacuum equipment ULVAC develops, manufactures, and sells use plasma-based technology. At the ULVAC
Advanced Technology Collaborative Research Cluster, opened at Tokyo Institute of Technology (hereinafter the “Tokyo
Tech”), we are conducting research with the aim of integrating Tokyo Tech’s plasma diagnostics technology and AI
technology. For plasma diagnostics technology, we are working on the verification of plasma conditions, and for AI
technology, we are promoting integration with numerical analysis. Going forward, to improve the accuracy of predictionof plasma conditions, we will use numerical analysis to calculate the plasma distribution in a vacuum chamber etc. We
expect there to be synergy with AI technology.
In addition, as an aspect of human resources development, we provide engineering students at Tokyo Tech’s ULVAC
Advanced Technology Collaborative Research Cluster with opportunities to deepen their understanding of vacuum andplasma processing technologies from an engineering perspective, through experiments and lectures. By “connecting”
different fields of research, namely, direct plasma diagnostics and AI technology, via ULVAC’s vacuum equipment, we
expect to expand the possibilities of vacuum equipment.

Fostering and Education of Technical Human Resources
For technical human resources, we aim to develop human resources possessing broader knowledge that goes beyond
that gained through engineering skills education as it is conventionally conducted.
Our particular focus is on developing human resources with an awareness of “management” based on “technology.”
We have invited Professor Shuzo Fujimura, Professor Emeritus of Tokyo Institute of Technology, as an advisor to guide us
on “Management of Technology (MOT).” Lectures start by encouraging trainees to rethink the meaning of the terms that
we use every day, such as by clarifying the difference between “research” and “development” and between “science”
and “technology,” and are designed so that trainees learn what they need to know in order to increase the probability ofinnovation. For us to be able to develop the products required by customers, development of human resources as wellas improvement of organizational quality are indispensable. Through these initiatives, ULVAC will further contribute to thedevelopment of industry and science as a comprehensive vacuum product manufacturer.

Diversity in Technical Human Resources
In FY2021, Sakae Inayoshi, an employee of ULVAC’s Institute of Advanced Technology, was awarded the title of “Shinkuu
no Takumi” by the Japan Society of Vacuum and Surface Science (Award to the full membership of the Society for
devoting many years to vacuum-related technology related to the Society or for pioneering the development of original
vacuum-related technology). The award is in recognition of her contributions over many years to vacuum technology
and her research on “development of surface treatments for various vacuum materials and evaluation of outgassing
characteristics.” Inayoshi is the first woman to receive this award since the title of “Shinkuu no Takumi” (Award to thefull membership of the Society for devoting many years to vacuum-related technology related to the Society or for
pioneering the development of original vacuum-related technology) was established in 2008 on the 50th anniversary of
the founding of the Vacuum Society of Japan, the predecessor of the Vacuum Society of Japan and Surface Science.
Ever since its foundation, ULVAC has sought to inculcate a corporate culture according prime importance to thetechnological development that underpins equipment manufacturing. Inayoshi succeeded to the research started by
Sonoko Tsukahara, who served as the director of the former Tsukuba Institute for Super Materials from 1989 to 1994,
and she has conducted research on gas emission measurement and development of surface treatment technology for
30 years. This award attests to her commitment to R&D. As greater participation of women in science and technology
has emerged as an issue in recent years, ULVAC will continue to promote the advancement of women.

Initiatives for the SDGs – Regenerative Medicine, Energy Sector, etc.
The ULVAC-Osaka University Joint Research Laboratory for Future Technology is conducting research initiatives that
address the SDGs. “Freeze-dry preservation of platelet-rich plasma using spray-freeze-drying (Micro Powder Dry(TM))(joint research with the Graduate School of Medicine, Osaka University)” is expected to be applicable to regenerative
23

ULVAC VALUE REPORT 2022

and Development Capabilities
medicine. For “Development of emerging computing method utilizing
magnetic skyrmion (joint research with the Graduate School of Engineering
Science, Osaka University),” magnetic films formed by vacuum deposition
technology are being applied to process information with zero energy.
In addition, in collaboration with the Graduate School of Engineering,Osaka University, we are conducting basic research on circularly polarized
light sources for direct cancer detection using endoscopes, SiC-MOS for
power devices, and GeSn light-emitting semiconductors for silicon photonics
applications. Moreover, as a unique theme using the Co-Creation Program, weare also conducting R&D of InP-based quantum dots applicable to high color
Conceptual diagram of a magnetic skyrmion
rendering light sources.
Note: The arrows represent magnetic spins andWith regard to education and human resources development, within
the center represents skyrmions (magnetic
quasiparticles that appear inside a magnetic
the framework of industry-academia collaboration as part of the Course ofmaterial).
Industry-University-Government Co-Creation of Osaka University, we offer
For details
ULVAC-Osaka University Joint
Japan’s first corporate co-creation program and accept students on master’s
Research Laboratory for Futureand doctoral courses who seek to develop not only research skills integral to
Technology
the academic foundation conventionally fostered by universities but also theability to adopt a panoramic perspective encompassing business development, including market exits and roadmaps, aswell as collaborative skills essential for management of joint research. Through these industry-academia joint research
activities (internship on campus), we are contributing to society.

Industry-Academia-Government Collaboration – Toward Technological Innovation for Quantum Computers
In the “Development of Integration Technologies for Superconducting Quantum Circuits,” which is one of the projects of
the Moonshot Research and Development Program promoted by the Japan Science and Technology Agency (JST) under
Goal 6 “realization of a fault-tolerant universal quantum computer that will revolutionize economy, industry, and securityby 2050,” ULVAC, Inc. and ULVAC CRYOGENICS INCORPORATED are in charge of developing the refrigeration system
specialized for quantum computing.
Whereas conventional computers are thought to be approaching their limits, quantum computers are attracting
attention because of their potential ability to meet the exploding demand for various types of information processing.
However, a refrigeration system that cools superconducting elements to near absolute zero (minus 273 degrees
Celsius) is indispensable for the proper operation of quantum computers. Through this initiative, we aim to makefurther contributions to technological innovation and offer solutions to social issues that harness the power of vacuum
technology.

Intellectual Property Assets
As a pioneer of vacuum technology in Japan, the ULVAC Group has accumulated intellectual property rights and knowhow in many vacuum-related fields over the past 70 years.
The vacuum-related intellectual assets accumulated within ULVAC, ranging from equipment, such as vacuum freezedrying equipment for pharmaceutical applications and semiconductor manufacturing equipment, to materials are
expected to be applied to new technologies in the future.
With vacuum technology at its core, the ULVAC Group will continue to create and utilize intellectual property assets
for the advancement of industry and science.
Basic Policy
The basic policy on intellectual property assets is “to develop
and enhance the business environment, strengthen thecompetitiveness of the entire ULVAC Group, and enhance
corporate value through intellectual assets.” To accomplish
this basic policy, we are implementing four measures.
1. Respect intellectual property rights of other companies
2. Utilize intellectual property information (IPlandscape) for business strategy
3. Link business, development, and intellectual
property strategies (trinity strategy)
4. Implement centralized management of intellectual
property of the entire GroupFor details

Initiatives and Structure for Intellectual Assets
Intellectual Property Strategy Committee
The Intellectual Property Strategy Committee has been
established as an organization to discuss Group-wide IP
strategies. The committee is chaired by the director in
charge of innovation and is working closely with the Boardof Directors. Members include responsible personnel ofdepartments and Group companies, and in formulating
intellectual property strategies, the committee adopts abird’s-eye view of the entire Group.

Website >> Research and Development > Intellectual Assets

ULVAC VALUE REPORT 2022

24

Feature

2

Vision 2032

Continue to Be a “Field of Potentiality” for the Future

The ULVAC Group celebrated its 70th anniversary on August 23, 2022. Taking the opportunityof this anniversary, we have formulated “Vision 2032,” the ideal configuration of the ULVACGroup 10 years from now. We will continue contributing to the future of people, society, andthe planet through vacuum technology and its peripheral technologies.
Vision 2032
Continue to be a “Field of Potentiality” for the Future

What is Vision 2032?
Taking the opportunity of the 70th anniversary of ULVAC’s foundation, we have envisaged the ideal configuration of the
ULVAC Group 10 years from now. The following process was used to develop the vision as well as to align the corporate
culture and values inherited from ULVAC’s foundation with the future.

Formulation Process
27 young project members from five countries spent a year discussing what kind of company ULVAC should
be 10 years from now. Initially, the project started with only discussions by project members, but subsequently
experts were invited from Tokyo Institute of Technology’s Laboratory for Design of Social Innovation in Global
Networks (DLab) to participate as facilitators and they provided guidance on scientific methods of organizing
and integrating ideas. DLab organized a lecture by a professor in the humanities, which enabled ULVAC project
members to gain insights into “vacuum” from a perspective different from that of physics and apply them in
discussions. DLab is working with various people, including students and people from companies and public
institutions, to design the ideal future, which is different from the future that can be predicted based on scientificand technological developments. ULVAC has been cooperating with the Tokyo Institute of Technology on various
initiatives centering on the ULVAC Advanced Technology Collaborative Research Cluster, and as part of thiscollaboration, ULVAC invited DLab to participate in this project to formulate ULVAC’s vision.

VacuumThrough discussion, we established a hypothesis, that is, “New ideas and new potentials emerge when wecreate an empty space in our mind and apply our will and passion to it.” This hypothesis was tested fromvarious perspectives, including that of the Basic Corporate Philosophy, Business Philosophy, and the founders’aspirations, such as “Deep Considerations about Vacuum.”

It is a completely empty space, a “Field of Potentiality.”
When energy is injected to a Vacuum,something new is created.

Vacuum is a Field of Potentiality: In his book, “Deep considerations about Vacuum” (Hakujitsusha,
2011), Dr. Chikara Hayashi, ULVAC’s third president who was also an expert in nuclear physics, described the“Field of Potentiality” as follows: “A vacuum field is a ‘field of potentiality’where certain phenomena may occur. That is a most reasonable explanation,in my opinion. The potentiality of a vacuum field is physically the potentiality
for change of energy and change of matter, but it is also the potentiality forchange of the individual and change of one’s mind through a series of changes.
And this change in the mind leads to a change of heart of a person (individual).
In the case of a group of people (society), it leads to change in the spirit
animating society.”

A potentiality created at empty space,
and the same is true of the human mind.
Away from preconceived ideas and constraints,
creating a space within oneself.
That’s where we apply our will and passion,
creating new ideas and new potentials.

ULVAC’s Spirit of Sustainability since the Foundation: ULVAC’s

Living every day without anxiety and with peace of mind,
a society where no one is left behind and everyone can live their own life,
a world where every life can be lived healthily.
Vacuum and passion are the keys to enabling a colorful future.
That is what we believe.
For people, for society, and for the planet
That has been the philosophy of ULVAC since its foundation.
Listening to everything that surrounds us,a reaction made through our encounters and acknowledged feelings,
to create truly valuable technology products.
This path was, is, and always will be.

For details of the ULVAC Vision Movie“Field of Potentiality”

ULVAC VALUE REPORT 2022

Business Philosophy was established in 1966 to codify the Management
Philosophy that has guided the Company since its foundation in 1952 and thebusiness operations and actions informed by that Philosophy, with the goal of
becoming a leading global company. The spirit of sustainability—encompassing
such insights as “Corporate sustainability,” “ Our people is crucial to thegrowth of the company,” “Pursuing reasonable profits,” and “Working for the
benefit of society”—has been part of our founding DNA, inherited through thegenerations down to the present day. In addition, “Depending on customers,”“Valuing time,” and “Comprehensive use of vacuum technology” can besummarized as “our company leads technological innovation through innovation
with vacuum technology at its core.”

As a result of these comprehensive considerations, the project team concluded that ULVAC should
continue to be a “Field of Potentiality” for the future. On this basis, the project team exchanged opinionswith ULVAC’s management and various internal and external experts, conducted a review, and secured
the approval of the Board of Executive Officers and the Board of Directors.

Remaining a “Field of Potentiality” for the future
ULTIMATE in VACUUM
ULVAC

25

Dr. Chikara Hayashi, the thirdpresident of the Company

The term “Field of Potentiality” alludes to “the margin of each person’s mind.” Having an empty space in one’s minds
allows one to absorb more from the outside world. Using the knowledge thus gained, one can venture into the unknown
and create the new. This begins when a person becomes aware of the “Field of Potentiality” within one’s mind. We
believe that the ULVAC Group, where the energy of such people is gathered, will also become a “Field of Potentiality,”
which will lead to the creation and co-creation of innovation with vacuum technology at its core that will contribute to asustainable future. How can we inculcate ULVAC’s vision throughout the global workforce? How can each employee takeownership of ULVAC’s vision? How can we create fields for unlimited potentialities and link the vision to the next midterm management plan? We recognize these as issues for the future. We will endeavor to ensure that everyone in the
ULVAC Group keeps the vision in mind and continues creating value for people, society, and the planet far into the future.

ULVAC VALUE REPORT 2022

26

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

ULVAC’s Sustainable Management
The foundation of all business activities is the Basic Corporate Philosophy stating our aspiration: “to contributeto the development of industries and science by comprehensively utilizing its vacuum and peripheraltechnologies.” We will work with our partners to pursue cutting-edge technology, and contribute to the creationof a sustainable society with vacuum technology while fulfilling our social responsibility.

Basic Corporate Philosophy
The ULVAC Group aims to contribute to the development of industries andscience by comprehensively utilizing its vacuum and peripheral technologies
through the mutual cooperation and collaboration of the Group companies.

Materiality Identification Process
Basic Approach
In the process of identifying materiality, we conducted an internal review and had in-depth discussions as well as
dialogues with external directors, external experts, institutional investors, and others. Reflecting the suggestions
obtained, we considered materiality in a broader sense from the viewpoint of enhancement of corporate value and havepositioned materiality as “ULVAC’s unique management issues for realization of our goal for 2050 and Vision 2032.”

Identification Process
STEP 1

Organize points of emphasis
Based on our goal for 2050 and Vision 2032, we organized the points of emphasis.
Basic Corporate Philosophy and purpose, Business Philosophy, Employee Principle
Uniqueness that differentiates ULVAC• To enhance economic, social, and environmental value••

Sustainability Policy

STEP 2The ULVAC Group strives to create economic, social, and environmental value
by comprehensively utilizing its vacuum and peripheral technologies.

Identify issues
Social Issues: We firstly exhaustively selected items from among the evaluation items of ESG evaluation
organizations, non-financial information disclosure standards*, and other requirements, and then, based on
the points of emphasis, we shortlisted the items, considering the degree of importance and the aspects
that should be addressed from a long-term perspective in order to achieve our goals.
*Global Reporting Initiative (GRI) Standards, ISO 26000 (Guidance on Social Responsibility), Sustainable Development Goals (SDGs), Ten Principles of the UN Global
Compact, Task Force on Climate-related Financial Disclosure (TCFD), Responsible Business Alliance (RBA) Code of Conduct, International Integrated Reporting Frameworkof the International Integrated Reporting Council (IIRC), Guidance for Integrated Corporate Disclosure and Company-Investor Dialogues for Collaborative Value Creation(Guidance for Collaborative Value Creation) released by the Ministry of Economy, Trade and Industry (METI), etc.

Business Issues: The secretariat of the Board of Directors played a central role in identifying ULVAC’s
unique management issues.
In addition, at the management meeting on strategy, the awareness of issues at head office divisions
was clarified and opportunities and risks for business divisions were identified.

Our Goal for 2050
A company that utilizes vacuum technology to create value for the world with its
partners and continues to contribute to the future of people and the planet
Use the latest technological development to contribute to
the realization of a safe, secure, affluent and convenientsociety

Human happinessContribute to the creation of a society in which all people
can lead happy lives

Environment

Contribute to creation of an environmentally friendly andsustainable society

Vision 2032
Continue to be a “Field of Potentiality” for the Future

for stakeholders

Impact on ULVAC’s business

STEP 4

Materiality
 romotion of creation and co-creation of innovation with vacuum technology at the corePDevelopment of diverse human resources and promotion of their advancement; cultivation ofresilient organizations
Respect for human rights and responsible conduct in the value chain
Contribution to a sustainable global environment

27

ULVAC VALUE REPORT 2022

Evaluate importanceIn evaluating importance, we evaluated and prioritized items based on the two axes of the “degree ofimportance for stakeholders” and the “degree of impact on ULVAC’s business,” and then considered
whether the items have a significant impact over the long term. Regarding the degree of “importance forstakeholders,” we defined customers, employees, suppliers, communities, and shareholders/investors as
our stakeholders and quantified their expectations.
The degree of “impact on ULVAC’s business” was quantified based on the impact on profit and loss,
laws and regulations, codes ofHigh importance
conduct, and policies, as well as
for stakeholders
the Basic Corporate Philosophy,
Business Philosophy, and other
Low impact on
High impact on
ULVAC’s business
ULVAC’s businesscompany policies, and evaluation
criteria such as investment for
growth.
Low importanceImportance for stakeholders

Economic growth andsocial abundance

STEP 3

STEP 5

Identify
A series of discussions were held at meetings attended by members of the Sustainability Promotion
Committee, internal directors, and managers of head office divisions and business divisions. Following
discussions under a company-wide cross-functional structure, based on certain hypotheses, we had dialogues
with external directors, institutional investors, experts, and others to confirm their expectations and requestsof the ULVAC Group and to organize the issues.

Determine
The Executive Officer in charge of sustainability who chairs the Sustainability Promotion Committee verified
the appropriateness of the materiality evaluation process and analysis results. Then, after discussion at a
meeting of the management team, the Board of Directors deliberated and approved the items of materiality.

ULVAC VALUE REPORT 2022

28

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

ULVAC’s Sustainable Management

Participation in External Initiatives

Promotion Structure

Signing the United Nations Global Compact

Sustainability Promotion Committee
Meetings of the Sustainability Promotion Committee chaired by the Executive Officer in charge of sustainability andattended by internal directors and managers of relevant departments are held twice annually to promote sustainability
management. The committee formulates policies, discusses and decides important matters, checks and evaluates
progress of key initiatives, and gives instructions to various meeting bodies and divisions as needed. Furthermore,progress is reported to the Board of Directors, which deliberates and makes management decisions when significant
issues arise.

Sustainability Task Force TeamAs a subordinate organization of the Sustainability Promotion Committee, the General Administration Department takes
the lead in planning, implementing, evaluating, and improving the ULVAC Group’s sustainability promotion.

In September 2021, ULVAC agreed to and became a signatory to the United Nations Global
Compact, supporting the Ten Principles related to protecting human rights, eliminating unreasonable
labor, addressing environmental concerns and preventing corruption set forth therein. By complying
with and putting into practice the Ten Principles of the UN Global Compact, we will further promoteresponsible management as a global company.

Endorsing the Task Force on Climate-related Financial Disclosures (TCFD)
RecommendationsULVAC has announced its endorsement of the recommendations of the Task Force on Climaterelated Financial Disclosures (TCFD) and has joined the TCFD Consortium. Based on the
TCFD recommendations, ULVAC will proactively disclose information on both the risks andopportunities that climate change poses to its business from the perspective of strategy, risk
management, and corporate governance.

Initiatives Aimed at Sustainable Development Goals (SDGs)
ULVAC will contribute to the achievement of Sustainable Development Goals (SDGs) and therealization of a sustainable society through the initiatives to address materiality.

Sustainability Subcommittees
As subordinate organizations of the Sustainability Task Force Team, subcommittees were established on themes suchas human resources, human rights, environmentally friendly products (Green Products), and climate change scenario
analysis. As forums for cross-organizational working-level discussions and information exchange, subcommittees havediscussions and make recommendations. In particular, on human resources and human rights, External Director Yoshimi
Nakajima attends in subcommittee meetings as an advisor and subcommittees are receiving her advice on how best to
promote activities.

Group Companies in Japan and Regional Headquarters
Information sharing, reporting, and discussions are held monthly with persons in charge of sustainability at individualcompanies on the content of their activities, and in particular on themes to be addressed across the Group.

External Recognition
MSCI Japan ESG Select Leaders Index
The MSCI Japan ESG Select Leaders Index is constructed by selecting Japanese companies
that have high Environmental, Social, Governance (ESG) performance from among theconstituents of the parent index (MSCI Japan IMI Top 700 Index; top 700 Japanesecompanies by market capitalization), and targets 50% of the free float-adjusted market
capitalization of each GICS®* Sector in the parent index. ULVAC has been selected as aconstituent of the MSCI Japan ESG Select Leaders Index since 2017.
*GICS: Global Industry Classification Standard
THE INCLUSION OF ULVAC, INC. IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP,
ENDORSEMENT OR PROMOTION OF ULVAC, INC. BY MSCI OR ANY OF ITS AFFILIATES. THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMES AND
LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES.

FTSE Blossom Japan Sector Relative Index
Promotion Structure

Sustainability Promotion
Committee

Sustainability Task Force Team

Chairperson: Sustainability Promotion
Committee
Members: Internal directors, division generalmanagers, relevant department heads

Secretariat: General Administration
Department

The FTSE Blossom Japan Sector Relative Index, developed by FTSE Russell, which is a subsidiary of
the London Stock Exchange, is designed to measure the performance of Japanese companies that
demonstrate strong Environmental, Social and Governance (ESG) practices. This index is constructed sothat industry or sector weights align with the Japanese equity market. The index also supports climatetransition to a low carbon economy by evaluating companies’ climate governance and climate change
efforts with TPI Management Quality Score*.
*TPI Management Quality Score: the quality of companies’ management of their greenhouse gas emissions and of risks and opportunities related to the low-carbon transition.
FTSE Russell (Registered trademark of FTSE International Limited and Frank Russell Company) hereby certifies that ULVAC, Inc. has qualified for inclusion in the FTSE Blossom Japan Sector
Relative Index as a result of independent research. The FTSE Blossom Japan Sector Relative Index is widely used to create and evaluate sustainable investment funds and other financial products.

S&P/JPX Carbon Efficient Index
Sustainability
Subcommittees

Group companies in JapanULVAC TECHNO, Ltd.

Human
Resources

Human Rights

ULVAC KIKO, Inc.
ULVAC EQUIPMENT SALES, Inc.
ULVAC CRYOGENICS INCORPORATED

Environmentally
Friendly
Products

ULVAC-PHI, Inc.
Climate Change(Green Products)

TIGOLD CORPORATIONULVAC COATING CORPORATION

Regional Headquarters
China
ULVAC (CHINA) HOLDING CO., LTD.

South Korea
ULVAC KOREA, Ltd.

TaiwanULVAC TAIWAN INC.

The S&P/JPX Carbon Efficient Index developed by S&P Dow Jones Indices and the Tokyo Stock
Exchange is designed to measure the performance of companies in the Tokyo Stock Price Index(TOPIX), while overweighting or underweighting those companies that have lower or higher levels ofcarbon emissions per unit of revenue and based on their environment-related disclosure.

Certified Health and Productivity Management Organization
This program recognizes corporations that have a particularly exceptional record in the area of healthand productivity management. The Nippon Kenko Kaigi (Japan Health Council) handles certification
for the program, which was designed by the Ministry of Economy, Trade and Industry. ULVAC, Inc.
has been certified as a Certified Health and Productivity Management Organization (White 500) since
2018. The ULVAC Health Insurance Association has been certified as a Certified Health and Productivity
Management Organization (Bright 500), and ULVAC EQUIPMENT SALES, Inc., ULVAC TECHNO, Ltd.,ULVAC-PHI, Inc., TIGOLD CORPORATION, and REJ Co., Ltd. have been certified as Certified Health andProductivity Management Organizations.
“White 500” and “Bright 500” refer to the top 500 corporations certified as excellent health and productivity management organizations.

29

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

30

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Mid-term Management Plan: Breakthrough 2022
FY 2022 is the final year of the current mid-term management plan “Breakthrough 2022” (covering the period
from FY 2020 to FY 2022). While maintaining the basic policies, we have revised the plan for consolidated
financial results for the final year in consideration of the market and the business environment.

Basic PolicyPlan for FY 2022Investment in development for growth (selection andconcentration)
Profit-oriented management through structural change
250.0

241.3

235.0

(Billions of yen)

185.4

Net sales··························· ¥250.0 billion

Net sales

Gross profit margin······························ 33%

OperatingprofitOperating profit margin··················· 13.8%

Operatingprofit margin

183.0

13.8%

12.5%
8.6%
16.0

9.4%

30.1

Progress
Under the current mid-term management plan,
we consider the trend of technological innovation
for realization of a smart society to be a business
opportunity leading to the resolution of social issues, andare pursuing various measures in accordance with thebasic policies: “Investment in development for growth(selection and concentration)” and “Profit-oriented
management through structural change.” Against the
backdrop of favorable market conditions, in FY 2021, net
sales exceeded the final year target, which we revised in

16%
or above
38.0

34.5

Initiatives (plan) under the mid-term
management plan

17.2

• New entry into

ROE··························································· 12%
Operating CF··························¥24.0 billion

2019
Result2020
Result2021
Result2022
Plan

Semiconductor
Production
Equipment

2022 (FY)
Initial target

Specific initiatives in FY 2022

1

Strengthening Growing Businesses

Further strengthen
semiconductor, electronic
device, and FPD businesses

Enhance components,
materials, and customer
support2

Further strengthen sales expansion activities for logic miniaturization process and memory processE lectronic Device
Production Equipment

Select five key fields (power devices, optical devices, communication devices, electronic devices, and implementation)
on which the Group should focus its efforts, and further strengthen sales expansion activities in these fields byproviding combinations of multiple manufacturing systems through modularization to meet customer needs

FPD Production Equipment

Further strengthen sales expansion activities for new products to be developed for large-substrate OLEDs andequipment for EV batteriesComponents

Enter new markets and further strengthen sales expansion activities by developing new products corresponding to thekey products that were selected as products on which the Group should focus its efforts

Materials

Enter new markets by developing new products in the semiconductor field and further strengthen sales expansion

Customer support

For businesses such as maintenance, surface treatment, cleaning, and parts sales, further strengthen sales expansion
activities in coordination with equipment sales expansion activities and also establish and promote a new business modelGrowing Businesses

2 Strengthening
Research andDevelopment
Capabilities

equipment throughmodularization• Strengthening
development, sales
and support systems
in China• Development for

FPD Production
Equipment

mass productionof large-substrate
OLEDs• Conversion to a
profitable structure

Expand development investment in the semiconductor, electronic device, and FPD businesses
Strengthen global development system by promoting joint development of cutting-edge technologies with world-leading companies
Focus from process development to product development

Enhancing Manufacturing Capabilities
Engineering and design reform

Further enhance product quality by strengthening value engineering for designR eform of the procurement
systemFlexibly reorganize the procurement system to respond to longer delivery lead times for parts and materials and in line with value
engineering

Production reform

Promote specialization of manufacturing technology of each site through consolidation of the Group’s production sites by productS trengthening the information
system infrastructure

Further promote productivity improvement through standardization of each business process and sharing of production information

Strengthening the Management Base

Human resources
Further strengthen human capital through visualization of skills of human resources, development of next-generation leaders, and promotion of diversity
development and revitalization
Promote business unit-based
Further strengthen collaboration among the Group companies regarding their businesses
management
Strengthen the financial basePromote sustainability
management31

1 Strengthening

Electronic
DeviceProduction
Equipment

Strengthening Research and Development Capabilities

Improve gross profit margin
by enhancing productivity
throughout the processes
from engineering and design
to production

4

logic miniaturization
process• Resumption ofmemory investment
and entry into newprocesses• Expanding proposedS emiconductor Production
Equipment

Strengthen productdevelopment in responseto technological innovationin growing markets bystrengthening the marketing
structure3

the previous fiscal year, while operating profit, ordinary
profit, and profit also exceeded the plan. This is due tovitalization of investment in advanced logic and memory
devices, electronics-related investment based on China’s
domestic production policy, and FPD-related investment
to meet increased panel demand, and we believe that
semiconductor and electronic device, investment willcontinue to increase, going forward.

Further strengthen cash flow management to realize investment in development for the further growth of the Group and improvement of capital efficiency

3 Enhancing

Manufacturing
Capabilities• Integrated reform of engineering &design, procurement, and production
Productivity improvement Profit
margin improvement• Human resources development andrevitalization

ULVAC VALUE REPORT 2022

• Adoption of the de facto standard for the

logic processes of 5 nm or below• Increased opportunities for entry into otherprocesses from Metal Hard Mask (MHM)
process as a second vendor• Expansion of equipment proposals with themodularized uGmni Series• Strengthening of sales and technical support

in China
Exceeded the sales plan in responseto active investment in power, optical,
electronic devices, etc.

• Progress in investment for development formass production of large-substrate OLEDs• Start of development of evaporation rollcoaters to realize smaller-sized and largercapacity EV batteries offering enhanced
safety• Improvement of profit margin throughsteady enhancement of manufacturing
capabilities• For details, please refer to the next page.
For details

P.33 Mid-term Management Plan
“Enhancing Manufacturing
Capabilities”• Education Center established• Absorption-type merger of two domestic• Promote business unit-based

management

4 Strengthening theManagement Base• Strengthening of the information

system infrastructure

Contribute to addressing social issues, such as smart society, digital society, and promotion of green energy, leveraging the Group’s technologies
V igorously disclose information on the risks and opportunities of climate change that affects the Group’s business activities, based on the TCFD
recommendations

FY 2021 results andprogress evaluation• Strengthening the financial basemanufacturing subsidiaries
Enhancement of manufacturing
capabilities, including those of overseas
plants, by integrating “development
and design” of the head officeand “manufacturing” of domestic
manufacturing subsidiaries• Implementation of various systemdevelopments to improve productivity• ROE 11.4%

Operating CF of ¥33.9 billion (Shareholders’equity ratio: 53.3%)

ULVAC VALUE REPORT 2022

32

ULVAC’s Vision

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Mid-term Management Plan: Breakthrough 2022

Enhancing Manufacturing Capabilities
ULVAC is engaged in promoting comprehensive reform of processes including engineering and design,
procurement, and production processes in order to significantly improve its profit margin through the“strengthening of manufacturing capabilities” set forth in the mid-term management plan.
For engineering and design reform, as equipment cost is determined in the design phase, measures aretaken to accurately ascertain the required specifications of the customer and improve the completeness oftechnical drawings. With respect to procurement reform, we will reorganize procurement organizations andrebuild the global supply chain to ensure stable quality and procurement and reduce procurement costs. For
production process reform, we have implemented initiatives for more efficient manufacturing operations
through specialization of production sites and improvement of manufacturing productivity. We are promoting
manufacturing education required for modular design and the new way of working. In July 2022, ULVAC, Inc.
merged with its production subsidiaries, ULVAC TOHOKU, Inc. and ULVAC KYUSHU CORPORATION throughabsorption-type mergers. By incorporating the two companies’ strengths in production technology, ULVAC willfurther enhance manufacturing capabilities, and roll out these initiatives across the Group companies including
those overseas.

Production Process Reform

Value Chain and Enhancing
Manufacturing Capabilities

Quality AssuranceMarketing

Processdevelopment
Equipment
concept
Product
development

Procurement Reform

Concept
designMassproduction
designEquipment
sales

Assembly
Purchasing

Detailed
design ofequipmentParts
manufacturing

Logistics Installation

Services

Inspection

Information system
Engineering and
Design Reform

We are implementing production process reform along
the two tracks of “specialization of production sites”
and “improvement of manufacturing productivity.”In the “specialization of production sites,”although we used to manufacture a single model atmultiple production sites, we will reorganize themby consolidating and specializing production while
monitoring market trends. Having production sites
specialize in certain specified models will lead todramatic improvement in production technology,
improvement in the efficiency of production processes,
and enhanced quality and reduced costs.

Furthermore, “improvement of manufacturing
productivity” is also being implemented in parallel. In
the area of equipment manufacturing, each production
site sets timely targets for indicators that go to theheart of manufacturing, such as production manhours
and lead time. We are making company-wide efforts toaddress challenges while monitoring the trends of such
indicators.

Enhancing manufacturing capabilities is made possibleby the foundation of quality and safety of ULVAC
products. From the perspective of quality assurance,
we have revised the quality policy by rebuilding theapproach to manufacturing with the aim of enhancing
manufacturing quality.
Based on this policy, we have defined all costs
and time that do not create value from a customer
perspective as “non-conformity as broadly conceived”
or “COPQ (Cost Of Poor Quality)” and are promoting an
initiative to control COPQ throughout the Group.

ULVAC Group Quality PolicyImprove quality & reduce costs
and lead time to halfMaximize profits and customer
satisfaction

Production Process Reform

Engineering and Design Reform
The cost and quality of equipment are mainly determinedin the engineering and design phase. Mindful that theefforts of upstream divisions are crucially important in
manufacturing, we conduct reforms with an awarenessthat equipment concepts are changing from tacitknowledge to explicit knowledge.
With regard to engineering reforms, we are engaged
in standardizing, optimizing and clarifying equipment
specifications, improving the quality of technicalmaterials, and upgrading manufacturing quality.

With regard to design reforms, we have incorporated“modular design” and are promoting the sharing,standardization, and simplification of manufacturing.
Furthermore, we are conducting education torealize quality and functions required by customers
at the minimum cost and incorporating an approachemphasizing customer perspectives into design
with the aim of realizing manufacturing that provides
satisfaction to customers.

 teady improvement in gross profit margin by strengthening manufacturingS
capabilities
Gross profit margin (%)

Net sales

33.0%

Gross profit margin

29.3
26.6
24.5

30.6

29.4

29.4
27.3

27.5

24.3
Strengthen manufacturing
capabilities and improve
productivity
Increase sales
Increase the ratio of
Semiconductor andElectronics Device
Production Equipment

22.6

Procurement Reform
In procurement reform, we have established the policyof “realizing optimized procurement” and reformed
procurement operations to achieve efficient partsprocurement that accounts for a large portion of
manufacturing cost.
Furthermore, we will rebuild the global supply
chain while strengthening coordination with overseas
Group companies and actively make efforts to procure
quality products from the best suppliers at low cost to
ultimately reduce procurement cost.
33

ULVAC VALUE REPORT 2022

19.4

From the perspective of parts processing, we arefocusing on improvement proposal activities suchas proposals of optimal configurations for design
divisions, proposal of alternative parts, and reviewing
manufacturing methods of processed parts throughcollaboration with suppliers.
We will establish these reform activities to enhance
our manufacturing capabilities.

Increase sales
Increase profit margin
Increase in the ratio of highly profitable
Semiconductor and Electronic Device
Production Equipment, and Components

Establish a profitable structure
Visualization

Reduce unprofitableproducts
Contain subsequent expenses

14.4

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022
Plan

(FY)

ULVAC VALUE REPORT 2022

34

Business Strategy

Introduction

About ULVACULVAC’s Vision

Vacuum Equipment Business

Vacuum Equipment Business

Semiconductor Production Equipment

Electronic Device Production Equipment

The semiconductor production equipment market is expected to experience
continued growth. We will focus development resources on fields whereparticularly strong growth is expected. We will aim to achieve sustainablegrowth by capturing market share through the introduction of equipment
developed using our proprietary technologies.

Orders received (Billions of yen)

The growth of the electronic device market, which supports progress toward
carbon neutrality and digital transformation, is accelerating. In particular,
investment in power devices, which are indispensable for the transition
to green energy such as EVs and mega solar power generation, has been
particularly active.
We aim to further expand business in such vibrant sectors of the electronic
device market.

50
40
30
20

2018

2019

2020

2021

Medium- to long-term outlook of the market
environment
In the semiconductor production equipment market, in the
short term, memory and logic inventory adjustments are
expected to temporarily restrain capital investment, butinvestment in development by manufacturers of advanced
devices and capital investment by customers in China
are expected to continue. In the medium- to long-term,
investment related to extreme ultraviolet (EUV) lithography
is expected to expand in the logic field, and demand for
Metal Hard Mask (MHM) process-ready equipment is
expected to increase.

Medium- to long-term initiatives
We are working to increase the number of different
processes for which our equipment is adopted by ourcustomers. With regard to logic, following entry to theadvanced device market, we are aiming for the adoptionof our equipment in a wide range of processes forcustomers’ products extending from conventional devices
to next-generation ones. In addition, by gaining a trackrecord through the adoption of ULVAC equipment by major
semiconductor manufacturers, we expect more potential
new customers to take the opportunity to evaluate ourequipment, which should lead to the winning of orders.
With regard to memory, we aim to have our customers
adopt ULVAC equipment in their processes when theytransition to the next generation of products.

35

ULVAC VALUE REPORT 2022

Orders received (Billions of yen)
60

45

30

0

2022 (FY)(Forecast)

Review of FY 2021
During the first half of FY 2021, orders received werefavorable, supported by robust semiconductor capital
investment. On the other hand, due to longer lead times
and higher prices of parts and materials, we focused on
ensuring on-time delivery to customers and cost control.
In the second half of FY 2021, capital investment by major
memory manufacturers slowed, but supported by capital
investment by logic manufacturers and customers in China,
we were able to achieve the plan for orders received.
Viewing customers’ requests for equipment evaluation
as an opportunity for business expansion, we vigorously
responded to such requests and gained a foothold for new
business.

Financial Data/
Corporate Information

15

10
0

Strengthening of Foundation
for Value Creation

Business Strategy

2018

2019

2020

2021

2022 (FY)(Forecast)

Review of FY 2021
1. Adoption of equipment when transitioning to
next-generation products (change of customers’
production processes to accommodate nextgeneration products) for advanced logic andmemory products

Investment in power devices and optical devices in theelectronic device market gained momentum mainly inJapan and China. In addition, owing to the reinforcementof the sales and technical support systems in China,orders received reached a record high and the sales plan
was achieved.

2. Adoption of equipment by new customers in theadvanced logic field

Medium- to long-term outlook of the market
environment

3. G aining of market share by introducing equipment
developed using proprietary technology

Smart cities are attracting attention around the world.
Therefore, the market demands the application of
cutting-edge information technology and solutions toenvironmental problems. In order to provide equipment
and services that meet customer needs, it is essential to
improve the performance and productivity of electronic
devices. As factory restructuring has begun around theworld, particularly in China, where the shift to production
within China is rapidly advancing, we aim to expand
business by providing customers with equipment andservices that meet market demands.

Recognized Business Opportunities

Conceivable Risks
1. Postponement of semiconductor capital investment
plan
2. D
 elay in next-generation device development andapplication to (investment in) mass production
3. D elay in delivery of equipment due to longer leadtimes in the supply chain

Measures for Reducing Risks and Maximizing
Opportunities
1. Strengthen marketing structure
2. S trengthen the response to development of leadingedge devices and competitiveness of existingproducts
3. S
 upport development and launch of massproduction by new customers
4. R edevelop and strengthen structure of global
supply chain

Medium- to long-term initiatives
To strengthen competitiveness of our product lines, wewill enhance the provision of solutions to our customers.
For this purpose, we will continue to standardize
equipment modules.
In addition, for business development in China andelsewhere in the world, optimization of production isnecessary and so we will review our manufacturing bases.
To keep pace with development in the rapidly growing
electronic device market, we will strengthen collaboration
with key customers and increase opportunities for suchinitiatives.

Recognized Business Opportunities
1. Diffusion of EVs in pursuit of carbon neutrality
2. E
 xpansion of demand for electronic devices in the
China market
3. Evolution of devices for realization of a digital society
4. Acquisition of new customers by leveraging the
track record with major customers
Conceivable Risks
1. D
 elay in delivery of equipment due to longer leadtimes in the supply chain
2. Intensifying competition
3. Tight supply of parts and materials due to surging
capital investment

Measures for Reducing Risks and Maximizing
Opportunities
1. S ecure parts and materials through systematicarrangements made in advance
2. D evelop equipment meeting customer needs
and achieve technological differentiation bystrengthening marketing systems
3. Improve production efficiency by enhancing
manufacturing capabilities
Priority fields
Priority fields

Final products

Communication devices

Smartphones

Optical devices

Smart devices
3D sensors

Electronic devices(MEMS)

In-vehicle displays
5G-ready equipment

Power devices

Devices for EV application
Industrial robots
Energy-saving equipment

Electronic packaging

Smartphones
High-speed data servers
IoT devices

ULVAC VALUE REPORT 2022

36

Business Strategy

Introduction

Vacuum Equipment BusinessYasuo Shimizu
Executive Officer,
General Manager of FPD
Division

Review of FY 2021
With the increase in stay-at-home demand due to theimpact of the COVID-19 pandemic, capital investment for
LCDs for high-definition IT panels gained momentum, andwe were able to receive more orders than in FY 2020.
Net sales were significantly higher than the previous
year, partly due to an increase in orders received in thesecond half of FY 2020, and furthermore, the gross profit
margin improved due to initiatives such as “manufacturing
capability reform” and other factors. In addition, regarding
products that can help mitigate global warming (reductionof CO2 emissions) and resolve energy issues, which areglobal issues, we set our sights on the development of
evaporation roll coaters that will realize larger-capacity,
more compact, and safer EV batteries.

Medium- to long-term outlook of the market
environment
In FY 2022, orders are expected to temporarily decline asa natural reaction to strong LCD investment in FY 2021
and because FY 2022 is expected to be a transitional
period before full-scale investment in mass production oflarge-substrate OLED for IT panels takes off. However,demand for flat panels is expected to continue to expand,especially in the IT panel market, as new lifestyles takeroot, typified by the normalization of remote work,
the shift to EVs, and greater use of AI. In addition,
the expanding EV battery market will be an attractive
opportunity for ULVAC if vacuum technology is adopted torealize smaller size, larger capacity, and improved safety.

Medium- to long-term initiatives
We will continue to invest in R&D of products for the IT
OLED market, which is expected to grow. In promoting
development of equipment for mass production of largesubstrate OLEDs for IT panels, we will leverage ourcore technologies of large-substrate transportation andfor higher-definition displays, and develop production
equipment for G8.5-class OLED for IT panels. Moreover,
we will continue to promote the shift to IoT of equipment
in readiness for smart factories.
Furthermore, our metal lithium vacuum deposition
technology has been adopted for the Green Innovation
Fund Project led by the Ministry of Economy, Trade andIndustry and the New Energy and Industrial Technology
Development Organization (NEDO) as a material

37

ULVAC VALUE REPORT 2022

ULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Vacuum Equipment Business

FPD Production Equipment
Demand for display devices applied ascommunication tools is increasing. Moreover, in
recent years, there has been growing demand forhighly efficient energy devices to realize stableenergy supply and reduce environmental impacts.
By vigorously engaging in business that helps
resolve these social issues, we aim to enhance thevalue of our business and achieve further growth.

About ULVAC

Components
Orders received (Billions of yen)

To accomplish the following two missions, wewill strive for business growth.

100

1. Product development and production ofcomponents supporting the equipment
businesses
2. Stable profitable business of the ULVAC Group

80
60
40

Dr. Ju Hoon Shin

20
0

2018

2019

2020

2021

2022 (FY)(Forecast)technology that will enable practical application of storage
batteries with more than double the current battery
pack capacity by 2030. By promoting this project andco-creation activities with related companies, we will
accelerate commercialization of metal lithium vacuum
deposition equipment for EV batteries.
Recognized Business Opportunities
1. L arger display substrates supporting the use of
OLED for IT products
2. Increased demand for lithium-ion batteries due todiffusion of EVs
3. Increased technological needs for smaller andhigher definition displays in line with the trend
toward wearable mobile devices

Conceivable Risks
1. Prolonged adjustment of display supply/demand
2. D elay in the shift and adaptation to next-generation
technology
3. R estrictions on exports for security reasons, andsupply chain interruption

Measures for Reducing Risks and Maximizing
Opportunities
1. Strengthen marketing
2. J ointly develop advanced technology with leading
companies
3. R edevelop and strengthen the structure of the
global supply chain
4. Improve production efficiency by enhancing
manufacturing capabilities

32
24
16

0

Review of FY 2021

Semiconductor, electronic device, and EV-related markets
remained robust. Special demand in anticipation of longer
lead times for parts and materials worldwide resulted in salesof the components business exceeding the sales plan.
Moreover, we pursued management reforms to
improve profitability in the vacuum pump field, focusing
on “optimization of production systems” and “efficiency
improvement at production sites,” and achieved thetargeted results.

Medium- to long-term outlook of the market
environment

We recognize that the semiconductor, electronic device,
optical film, FPD, EV, and industrial equipment markets are
expected to grow over the medium to long term.
Since our major customers in the semiconductor,
electronic device, optical film, and FPD fields are
manufacturers of vacuum deposition equipment, we
expect that the growth of the above-mentioned markets
will increase demand for the DC power generators and dry
pumps installed in such equipment.
In the EV and industrial equipment markets, in addition
to helium leak detectors, we also anticipate increased
demand for cryocoolers for quantum computers and MRIs.

Medium- to long-term initiatives

Having set four product groups as strategic products—DC
power generators, helium leak detectors, dry pumps,
and cryocoolers, we will promote vigorous entry into themarket and expansion of our market share by developing
fundamental technologies and new products. “Quality” isthe top priority of the components business. Specifically,
we will make cross-organizational efforts at all production
bases in Japan and overseas to improve product quality

Components essential for
vacuum equipment.
ULVAC supplies vacuum
pumps, vacuum gauges,
vacuum valves, helium leakdetectors, gas analyzers, power
generators for deposition
processes, etc. to vacuum
equipment manufacturers,
machinery manufacturers, etc.

40

8Executive Officer
General Manager of Components
Division

Components

Orders received (Billions of yen)

2018

2019

2020

2021

2022 (FY)(Forecast)and production efficiency. Based on these activities, wewill build a system capable of providing optimal solutions.
Recognized Business Opportunities
1. B usiness environment in which the components
business can take advantage of synergy withthe semiconductor, electronic device, and FPD
production equipment businesses
2. R obust market environment for semiconductors,
electronic devices, optical films, displays, EVs, etc.
3. E
 xpansion of the measuring instrument market inline with the diffusion of EVs
4. Cultivation of untapped markets (Europe, U.S., China)

Conceivable Risks
1. D
 elay in delivery due to longer lead times in the
supply chain
2. E mergence of latecomer, low-cost manufacturers
due to quality improvements

Measures for Reducing Risks and Maximizing
Opportunities
1. R elease differentiated products leveraging
collaboration with customers and partners
2. C oncentrate development resources on strategic
products
3. Improve production efficiency throughoptimization of production and procurement
4. Establish sales network for new markets

Application example
Examples of installation

Advanced research,
medical, etc.

Vacuum measurement

Cryopumps

OLED production
equipment

Vacuum valves

Dry pumps

Film deposition
controllers

DC power
generators

4K cryocoolers
for coolingsuperconductive
magnets

Helium leakdetectors

VacuumgaugesResidual gas
analyzers

Liquid nitrogengenerators

ULVAC VALUE REPORT 2022

38

Business Strategy

Introduction

Vacuum Equipment Business

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Vacuum Application Business
Orders received (Billions of yen)

Industrial Equipment

Materials

The industrial equipment business is engaged in global businessdevelopment and expansion of sales of vacuum heat treatment furnaces forbrazing used in the manufacture of heat exchangers and vacuum melting
furnaces for magnet materials applied in motors mounted on EVs mainly in
China. Moreover, we are promoting sales expansion of vacuum freeze-drying
equipment used for pharmaceuticals and other applications.

Orders received (Billions of yen)25
20

The semiconductor and FPD markets where sputtering target products, themainstay of the materials business, are used are expected to grow over thelong term in line with progress toward a digital society. In collaboration withULVAC’s equipment businesses and by exploiting the material technologies
such as powder metallurgy and metallurgy technologies we have cultivatedover the years, we aim to expand our business through the global promotionof advanced materials attuned to the progress of devices.

30

20

15
10
5
0

2018

2019

2020

2021

2022 (FY)(Forecast)

10

Review of FY 2021
0

2018

2019

2020

2021

2022 (FY)(Forecast)

Review of FY 2021
Establishment of mass-production systems for vacuum
furnaces at our bases in China was completed. In addition
to export of these furnaces from China to other countries,
improved production efficiency was achieved. Moreover,by developing equipment in parallel in China, we wereable to realize timely development in the buoyant Chinese
market, leading to a higher market share. For vacuum
freeze-drying equipment, the Japanese government
solicited applications for subsidies to ensure a stablesupply of pharmaceutical products in Japan in response to
the spread of COVID-19, but due to delay in the selectionof companies to receive subsidies, we were unable toachieve the plan for orders received.

Medium- to long-term outlook of the market
environment
In response to the global policies toward carbon neutrality,
demand for EVs and renewable energy, such as wind
power generation and power storage, is expected tocontinue to increase. Customers in China where relatedresources are abundant are demanding equipment thatwill increase their production output. By incorporating
customer needs in equipment development, we aim
to increase orders. In the medical field, we expect anincrease in orders for vacuum freeze-drying equipment
due to rising demand for injectable pharmaceuticals.

Medium- to long-term initiatives
Regarding vacuum furnaces, we will further strengthen
production systems at our bases in China. At the sametime, we will further pursue product safety and quality
improvement, aiming to receive orders globally.
With regard to vacuum freeze-drying equipment, ourintention is to expand orders by developing models thatmeet customer requirements and by complying with strict
standards and audits required by the industry.

39

ULVAC VALUE REPORT 2022

Recognized Business Opportunities
1. L arge-scale investment in the magnet industry in
response to mass production for EVs by Chineseand Japanese manufacturers
2. H eightened demand for the energy business suchas wind power generation and power storage
3. R enewal of customers’ facilities to improveequipment functions and productivity in response
to increasingly sophisticated quality control ofpharmaceutical products

Conceivable Risks
1. Greater security-related export restrictions, etc.
2. D elay in delivery of equipment due to longer leadtimes in the supply chain
3. S hift of production overseas by domestic
pharmaceutical companies

Measures for Reducing Risks and Maximizing
Opportunities
1. Improve performance of melting furnaces forferromagnetic magnets and promote joint
development with key customers
2. S ecure the necessary parts and materials throughsystematic arrangements made in advanceIn the fast-growing semiconductor market, we strengthened
sales activities for products for leading-edge semiconductors,
especially those used for logic and memory, resulting in
brisk orders received. Regarding products for FPDs, orders
received increased centering on those for IGZO targets foroxide film semiconductors, which are strategic products,
reflecting the buoyant OLED field, and we maintained a highmarket share in this business field.
Despite the impact of soaring raw material prices,
we were able to improve the profit margin compared to
FY 2020 by establishing production systems for more
efficient manufacturing and improving manufacturingmethods.

Medium- to long-term outlook of the market
environment
In line with progress toward a digital society, medium- tolong-term market growth is expected in the semiconductor,
electronic device, and FPD fields. In the semiconductor
market, demand is expected to expand not only for consumer
applications but also for industrial applications such as data
centers. In the FPD market, for home and automotive
applications, demand for FPDs to serve as interfaces for smart
devices is expected to grow. Demand for thin-film materials
such as wiring and semiconductor layers to be incorporated
in these devices and new materials to achieve higher device
performance is also expected to increase.

Medium- to long-term initiatives
In the FPD market, through joint development withcustomers and strengthening sales support at bases, we
aim to maintain the high share by supplying sputteringtarget products that respond to technological changes in atimely manner.
In order to increase orders for products forsemiconductors, for which high market growth rates
are expected, we will endeavor to increase production
volumes by improving high-quality and stablemanufacturing technologies to meet customers’ quality
requirements, optimizing production bases including
the semiconductor production lines introduced at
manufacturing bases in China, and improving productivity.
Recognized Business Opportunities
1. Increased demand for thin-film materials (sputteringtargets) associated with the ongoing diffusion ofsmart devices
2. Investment in mass-production lines by leadingedge semiconductor device manufacturers
3. S witching to new materials in line with the trend
toward higher definition and diversification of FPD
panels

4. Rapid growth of the semiconductor market in China

Conceivable Risks
1. Intensifying price competition
2. D elay in next-generation device development andapplication to mass production (capital investment)
3. R estrictions on exports for security reasons, andsupply chain interruption

Measures for Reducing Risks and Maximizing
Opportunities
1. C reate competitive new products by working withthe equipment businesses
2. S trengthen networks through marketing at each base
3. Improve production technology and production
efficiency and reinforce production systems atbases in China
4. Promote joint development with leading companies

3. P romote overseas business development for
vacuum freeze-drying equipment

Other

Surface analyzer business
Whereas university and company laboratories
were previously the principal users of surface
analyzers, they are increasingly used nowadays
for routine purposes such as product inspection.
Surface analyzers are being applied to morematerials in more regions and markets throughout
the world. ULVAC will continue offering surface
analyzers and services from customers’
perspectives around the world.

Production and sales of semiconductor/FPD
mask blanks
Mask blanks are indispensable in the fabrication ofelectronic circuits for semiconductors and FPDs,
which are essential for smartphones, IT panels, IoT,
automobiles, communications, and other fields.
Demand for mask blanks is trending upward,
especially as devices evolve. We will respond to
customer requirements to ensure that we ride thewave of market growth.

ULVAC VALUE REPORT 2022

40

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Corporate Governance

Basic Corporate Governance Policy and Structure
In accordance with its Basic Corporate Philosophy, “TheULVAC Group aims to contribute to the development ofindustries and science by comprehensively utilizing its
vacuum and peripheral technologies through the mutual
cooperation and collaboration of the Group companies,”
ULVAC, Inc. works to ensure thorough corporate
governance in order to increase corporate value overthe medium to long term. From this perspective, we
respect the interests not only of shareholders, but alsoof business partners, local communities, employees,
and other stakeholders that are related to our businessactivities. We also value competitive and efficient
operation, while ensuring strict compliance with laws
and corporate ethics.
ULVAC, Inc. has adopted a company with a boardof corporate auditors as its management structure.
Particularly important institutional structures include theBoard of Directors, the Board of Executive Officers, theBoard of Corporate Auditors, and the Committee for
Appointment and Remuneration, etc.

Firstly, ULVAC, Inc. has a Board of Directors, which
is a decision-making body for important management
issues. The Board holds regular meetings once a month,
as well as ad hoc meetings as necessary to ensure
flexibility. The Board of Directors comprises sevenmembers, four of whom are independent external
directors. By virtue of this structure, ULVAC, Inc. is
not only able to make swift and efficient judgments
concerning important management issues, but is alsoable to achieve fair, impartial, and highly transparent
deliberation, as well as operational supervision.
An executive officer system has been introduced,
and thus executive officers exercise executivefunctions, having been granted a certain amount ofresponsibility and authority over their designatedareas, through delegation by the Board of Directors.
ULVAC, Inc. also has a Board of Executive Officers thatcomprises a total of 18 internal directors and executive
officers. The Board of Executive Officers holds regularmeetings once a month, as well as ad hoc meetings

Corporate Governance Structure

as necessary. By virtue of this structure, we haveachieved more flexible and swifter business operations
that are appropriate for a rapidly changing businessenvironment, based on a clear expression of the
responsibilities and authority of each executive officer.
In addition, ULVAC, Inc. has a Board of Corporate
Auditors, which performs auditing and supervision ofmanagement decision-making and business operations.
The Board of Corporate Auditors comprises four
members, two of whom are independent external
auditors. We ensure full auditing and supervisory
functions through close links between auditors andthe Internal Auditing Department and the independent
auditor, whose independence is ensured, as well as
through attendance and comments by auditors atimportant meetings, such as meetings of the Boardof Directors and the Board of Executive Officers, andthrough regular meetings between the Internal Auditing
Department and the President, etc. By virtue of thisstructure, we have achieved rigorous, fair, impartial, andComposition of Key Organizations and Skills Matrix

Title

Appointment/Dismissal

Board of Directors

Appointment/Dismissal
Audit

Collaboration
Board ofCorporate Auditors

Compliance Committee

Independent
AuditorAccounting audit

Audit

President andChief Executive Officer
Collaboration

Board of Executive Officers

Collaboration

Sustainability Promotion
Committee
Divisions of the Company

Group companies

Audit

Name

Appointment/Dismissal

Recommendations

Committee for Appointment
and Remuneration, etc.

Expertise/experience*2

Composition of key organizations

General Meeting of Shareholders

Risk Management
Committee

transparent auditing and supervisory functions, ensuringthat each auditor obtains sufficient information.
Furthermore, we have a Committee for Appointment
and Remuneration, etc. for cases requiring objective
determination of important matters, such as theappointment and remuneration of directors andexecutive officers. The Committee for Appointment andRemuneration, etc. comprises seven members: one
internal director, four independent external directors,
and two independent external auditors. The Committee
is chaired by an external director. By having such
advisory bodies for the Board of Directors, we areable to achieve fair, impartial, and highly transparent
deliberations with regard to especially importantmanagement decisions, and thus increase theeffectiveness of the Board of Directors.
Members of the Board of Directors, the Board of
Corporate Auditors, the Board of Executive Officers, theCommittee for Appointment and Remuneration, etc. areindicated in the list below.

Internal Auditing
Department

President andChief Executive
Officer
Director andExecutive Vice
President
Senior Managing
Director

Board ofDirectors

Board ofCorporate
Auditors

Board of
Executive
Ofﬁcers*1

Committee for
Appointment
andRemuneration,etc.

Corporate
management

GlobalSales/
marketing

R&D/
Legal
Finance/technology/
affairs/risk
manufacturing accounting management

Setsuo Iwashita

Mitsuru Motoyoshi
Dr. Choong Ryul
Paik

External Director

Hiroyuki Nishi

External Director

Norio Uchida

External Director

Dr. Kozo Ishida

External Director

Yoshimi Nakajima

Auditor

Makoto Ito

AuditorKazuya Saito

External Auditor

Senshu Asada

External Auditor

Isao Utsunomiya

Chairperson
Chairperson
Observer*1 The Board of Executive Officers also includes executive officers in addition to the above.
*2 Main expertise and experience of each director and auditor are listed.
The above list does not represent all the expertise and experience of each person. It indicates areas regarding which the Company has particular expectations.

41

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

42

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Corporate GovernancePrincipal Activities of External Directors and Auditors in FY 2021

Directors’ Remuneration

A resolution on the policy on determining the content of
individual remuneration, etc. of directors was passed in
the meeting of the Board of Directors held on February
12, 2021. ULVAC’s policy on determining the content
of individual remuneration, etc. of directors is thatthe determination of remuneration of each director
should take into consideration the responsibility of eachdirector for not only the Company’s non-consolidated
business results for a single fiscal year, but also forthe sustainable enhancement of the corporate valueof the ULVAC Group. Multiple remuneration elements
are evaluated in combination as described below toappropriately reflect directors’ contributions according
to their respective responsibilities to ensure theremuneration, etc. of each director is at an objectively
appropriate level.
When determining the specific remuneration for
individual directors, the Committee for Appointment
and Remuneration, etc., which was established inorder to ensure management transparency, fairness,
and appropriateness of remuneration, etc., analyzes
the level of remuneration at other companies of similar
size in similar industries, etc. as ULVAC. The Committee
then evaluates and verifies the aforementioned
responsibilities and contributions of individual directors
from various perspectives, examines the remuneration,etc. of each director to ensure that it is at an appropriate
level, and submits recommendations to the Boardof Directors. Based on these recommendations, theamounts of remuneration, etc. of individual directors
are determined by a resolution of the Board of Directors
within the total amount of directors’ remuneration
approved by the resolution of the general meeting ofshareholders.
The remuneration, etc., of internal directors willreflect not only the appropriate supervisory functionof the Company’s overall management, but also
multifaceted evaluations such as internal directors’
responsibility for the Company’s non-consolidated
performance for a single fiscal year, their responsibility
for the sustainable enhancement of the corporate valueof the ULVAC Group, and the degree of contributionof their responsibility according to their respective
positions. For this purpose, the remuneration is madeup of base remuneration as fixed remuneration that iscommensurate with position and paid in a fixed amountevery month, annual performance-linked compensation(officer bonus) linked to the business results forthe corresponding fiscal year and stock-based
remuneration, etc. through a Board Benefit Trust (BBT)
that is a stock-based remuneration plan determinedaccording to the degree of achievement of annual
performance targets. In contrast, from the perspectiveof conducting appropriate supervision of the Company’s
management as a whole from a fair viewpoint,
external directors’ remuneration consists only of basic
remuneration, which is fixed remuneration.
43

ULVAC VALUE REPORT 2022

Resolutions of the Board of Directors on
remuneration, etc. of directors are determined within
the extent of the maximum amount of aggregate
remuneration for directors set at ¥500 million perannum (including a maximum of ¥90 million for external
directors) by resolution at the Ordinary General Meetingof Shareholders. For internal directors, remuneration,etc. through a Board Benefit Trust (BBT), which
was resolved at the Ordinary General Meeting of
Shareholders, is also granted as performance-linked
remuneration not included in the relevant remuneration
limit.
The Company abolished the officer retirement
benefits system.

Name of external
director/auditor

Reasons for selection as an external
director/auditor

Attendance and principal activities

Hiroyuki Nishi

To receive valuable opinions based on
his extensive experience and broad
perspective particularly centered on risk
management

Attended all 13 meetings of the Board of Directors held during the fiscal year andprovided opinions concerning deliberation of the agenda as necessary, based on
his extensive experience and sophisticated insight as a corporate manager ofother companies both in Japan and overseas.

Norio UchidaTo receive valuable opinions based on
his extensive experience and broad
perspective particularly centered oninternational sales activities

Attended all 13 meetings of the Board of Directors held during the fiscal year andprovided opinions concerning deliberation of the agenda as necessary, based on
his extensive experience and sophisticated insight as a corporate manager ofother companies both in Japan and overseas.

Dr. Kozo Ishida

To receive valuable opinions based on
his extensive experience and broad
perspective particularly centered on
research and development

Attended all 13 meetings of the Board of Directors held during the fiscal year andprovided opinions concerning deliberation of the agenda as necessary, based on
his extensive experience and technical expertise as a corporate manager of othercompanies both in Japan and overseas.

Yoshimi Nakajima

To receive valuable opinions based onher extensive experience and broad
perspective particularly centered oninternational sales activities

Attended all 13 meetings of the Board of Directors held during the fiscal year andprovided opinions concerning deliberation of the agenda as necessary, based onher extensive experience and sophisticated insight as a corporate manager ofother companies both in Japan and overseas.

Senshu AsadaTo receive valuable opinions based on his
experience and specialized knowledge
as an attorney

Attended all 13 meetings of the Board of Directors and all 19 meetings of theBoard of Corporate Auditors held during the fiscal year and provided opinions
concerning deliberation of the agenda as necessary, mainly from a specialist
perspective as an attorney.

Isao
Utsunomiya

To receive valuable opinions based on his
experience and specialized knowledge
as a certified public tax accountant

Attended all 13 meetings of the Board of Directors and all 19 meetings of theBoard of Corporate Auditors held during the fiscal year and provided opinions
concerning deliberation of the agenda as necessary, mainly from a specialist
perspective as a certified public tax accountant.

Evaluation of Effectiveness of the Board of
Directors

For the purpose of enhancing functions of the Boardof Directors and thus enhancing corporate value, at
ULVAC, Inc. an annual self-assessment survey of
directors and auditors is conducted concerning theeffectiveness of the Board of Directors.
Anonymity is secured as directors and auditors
provide their responses to the survey directly to an
external institution. Based on the external institution’sreport on the survey results, the Board of Directors of
ULVAC, Inc. conducts analysis and evaluation.
As a result of analysis and evaluation about theeffectiveness of the Company’s Board of Directors
for FY 2021, it is judged that effectiveness of theCompany’s Board of Directors is secured. However,proposals such as on enhancement of discussion ofmanagement strategy and sustainability have been
submitted, and in our continuing efforts to enhance theeffectiveness of the Board of Directors, we will accord
due consideration to these proposals.

Policy on Selection of External Directors andAuditors

In order to enhance the effectiveness of the Boardof Directors by realizing multifaceted discussion atmeetings of the Board of Directors, balance among
knowledge, experience, capabilities, etc., diversity, andappropriateness of the size are taken into consideration
regarding the composition of the Board of Directors.
Based on these perspectives, the Board of Directors
carefully selects director candidates. Regarding
attendance at the meetings of the Board of Directors,
efforts are made to ensure an appropriate numberof attendees from the viewpoint of ensuring swift
decision-making.

Initiatives to Ensure Effectiveness of Audit

Meetings of the Board of Corporate Auditors of theCompany were held 19 times in FY 2021 at which
important matters concerning audit, including agendas
for meetings of the Board of Directors were reported

and discussed. Based on discussions at meetingsof the Board of Corporate Auditors and expertise ofindividual auditors, auditors provide recommendations
to directors of the Company, as necessary, not only at
meetings of the Board of Directors. ULVAC, Inc. secures
opportunities for auditors to periodically exchange views
with directors, staff of the Internal Auditing Department,
and the Independent Auditor on wide-ranging matterssuch as compliance and the situation concerning designof internal control. ULVAC ensures that auditors areprovided with information necessary for auditing andthat they attend meetings they should attend fromthe perspective of ensuring the acquisition of suchinformation.

Policy on Training of Directors and Auditors

ULVAC, Inc. provides its directors and auditors with
opportunities for training deemed necessary in order forthem to fulfill their roles and responsibilities.
Newly appointed external directors receive
explanations about management strategy, financial
standing, management issues and other importantmatters, and are given opportunities to acquire
knowledge and insight through tours, etc. of businesssites for the purpose of gaining a deeper understandingof the ULVAC Group.
For newly appointed auditors, ULVAC, Inc. provides
training opportunities on a par with those for newly
appointed directors upon the request of auditors. Afterthey take office as directors and auditors, the Board of

Directors provides them with opportunities to explain
business strategies and management issues, etc. foreach fiscal year. ULVAC, Inc. also provides directors
and auditors with financial support for training deemednecessary in order for them to fulfill their duties, as wellas encouraging them to enhance their expertise. These
training opportunities are reviewed on a continuous
basis and updated as necessary.

Policy on Strategic Shareholdings

ULVAC, Inc. may acquire shares of a listed company
with which it has transactions only when it is judgedthat maintaining and strengthening the business
relationship with the entity by acquiring its sharescontributes to ULVAC’s sustainable growth andenhancement of corporate value over the medium tolong term.
Regarding strategic shareholdings, an annual
assessment is conducted on whether or not to holdeach individual strategic shareholding, examining
whether the purpose is appropriate in terms of thebenefits and risks from each holding or the Company’s
cost of capital, and the results of this assessment arereported at a meeting of the Board of Directors. If, as aresult of the assessment, it is judged that the holdingof certain shares has little significance, the Company
considers reduction of the shareholding of such shares.

ULVAC VALUE REPORT 2022

44

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Messages from External Directors

Hiroyuki Nishi

Norio Uchida

Became an External Director of the Company in September 2020 after

Became an External Director of the Company in September 2015 after

serving as Director of Nippon Life Insurance Company, President andserving as Representative Director, President & CEO of TOPCON

Chief Executive Officer of Nissay Asset Management Corporation, and

CORPORATION.

President and Chief Executive Officer of Nissay Credit Guarantee Co.,
Ltd. (current position)

The business environment in which the ULVAC Group
operates changes day by day and technologicalinnovation is progressing rapidly. In addition, there are
numerous uncertain factors. We have to learn to livewith COVID-19 and natural disasters are a fact of life
in Japan. The protracted situation in Ukraine, concerns
about the possibility of a global recession, and friction
between the U.S. and China are just a few examples of
the geopolitical risks we face. Even amid this turbulent
environment, we must remain focused on our vision
and advance without wavering.
This is the context in which ULVAC has formulated
Vision 2032, “Continue to be a Field of Potentiality
for the Future.” It is noteworthy that the vision was
the fruit of discussions among young employees inJapan and abroad. This vision indicates that the very
DNA that animated ULVAC at its foundation remains asvibrant as ever in the year ULVAC is celebrating its 70th
anniversary. Vision 2032 is essential for ULVAC’s future
growth. The key is how to inculcate this wonderfulvision in the hearts and minds of the entire workforceof the ULVAC Group, making it an everyday reality
throughout our operations. Materiality (key issues)
provides a perspective on what needs to be done toachieve the vision.
For ULVAC, an enterprise committed to theprogress of technology and development, innovating
together with partners in each business, while always
considering human rights and environmental issues
from a global perspective, will lead to sustainablegrowth and enhancement of corporate value. This, inturn, will be a source of satisfaction and happiness forall stakeholders, including employees and customers,
leading to win-win relationships for three or four
parties, indeed for everyone concerned. For all ULVAC
employees to take pride in Vision 2032 and work in

45

ULVAC VALUE REPORT 2022

unison toward its achievement, it is necessary tostrengthen the organization and structure upon which
this vision is founded.
In my experience, excellent global organizations arethose equipped with capabilities to respond with both“resilience” and “flexibility.”
In business, no matter what happens or when it
happens, if an organization has such robust capabilities,
it will be able to conduct “offensive” management bycarefully assessing and managing risks.
Effective risk management is not about not taking
risks, but involves examining risks from all angles anddeciding whether to embark on a project, or continue
or withdraw from a project, from the viewpoint of
whether the risk is appropriate in terms of the mediumto long-term growth of the company or whether
the company can manage the risk if it materializes.
“Diversification of risk,” which is a hot topic nowadays,
is a form of risk management designed to prevent,through diversification of business, geography, time, or
human resources, concentration of risk in a particularfield. For the ULVAC Group whose overseas presence
is high, business management (PDCA) and governanceacross Group companies worldwide are particularly
important and should be further improved as we
advance.
As a member of the Board of Directors, I will
provide multifaceted support from these perspectives.
Recognizing the critical importance of speed intackling the challenges confronting the ULVAC Groupin the environment in which it operates, let’s advance
persistently, boldly, and meticulously to enable ULVAC
to “Continue to be a Field of Potentiality for the Future.”
And beyond that, let’s make the ULVAC Group a“truly global enterprise.”

ULVAC celebrated its 70th anniversary this year, and
Vision 2032, “Continue to be a Field of Potentiality for
the Future,” articulating what ULVAC aspires to be 10
years from now, as conceived by young employees inJapan and overseas, is significant. Furthermore, it isnecessary to clarify materiality and address it in the
mid-term management plan. In my mind’s eye, I see
ULVAC 10 years down the road firmly established as afield of potentiality for the future. ULVAC’s materiality
mainly concerns two issues.
The first key issue is how best to promote uniqueinitiatives to achieve the vision. This will necessarily
involve the entire workforce of the ULVAC Group andwill include sustainable innovation and development of
global and specialist human resources. Innovation is
the key to creating the best in the world. Moreover, tocreate the first in the world, in addition to passion, bothsensitivity and imagination are needed. Understanding
global customer needs is essential for sustainable
creation of innovative technologies. It is importantto have a marketing base in every country where
the needs are future-oriented and the competition
is formidable, along with an R&D base with a suregrasp of these needs. The key to success in creating
innovation is speedy information sharing between
marketing and R&D. Since Japan’s GDP, which stood at
18% of global GDP in 1995, has shrunk to one-third ofthat, global operations are essential. The initial step in
product development begins with information gathering
to draw up a scenario, i.e., marketing. It takes 10
years to develop specialized human resources capableof effective global marketing. While a cadre of suchpeople is being nurtured within ULVAC, hiring humanresources for marketing from outside the company isalso a possibility. New businesses and products willbe created by expediting the sharing of information
between technical teams and those who possess therequisite expertise in marketing.
The second materiality is a corporate issue:
how best to strengthen the management base(strengthening of governance, investment in bases,
workstyle reform, human resources investment,
environmental investment, etc.) and improve financial
performance (management of achievement of profit
targets, optimal allocation of management resources,
improvement of asset efficiency through selection
and concentration, etc.). In order to achieve thevision, both human resources and the company’sbusiness foundation must function smoothly. In theprocess, human resources capable of innovation will
be developed. In addition to passion, sensitivity, andscenario skills, these human resources need to havea sense of crisis and possess expertise that the world
craves. The ULVAC Group needs frontline humanresources to work globally and back-end specialists on
the support side. Youthful frontline human resources
should be eager to work overseas, while the support
side should aim to become specialists.
In 2032, I expect to see ULVAC’s human resources
displaying their capabilities around the world andcreating innovation on a sustainable basis. Moreover, I
expect to see a “Field of Potentiality” firmly anchoredglobally, with issues of materiality having beenaddressed effectively through execution of the midterm management plan, paving the way for ULVAC’s
emergence as a “global leader.”ULVAC VALUE REPORT 2022

46

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Messages from External Directors

Dr. Kozo Ishida

Yoshimi Nakajima

Became an External Director of the Company in September 2016 after

Became an External Director of the Company in September 2018 after

serving as Vice Chairman and Representative Director of HORIBA, Ltd.

serving as Vice President of Citibank, N.A., Senior General Manager ofSociete Generale Securities Services, and President and Representative
Director of American Express Japan Co., Ltd.

In the semiconductor and FPD industries, which
include ULVAC’s main customers, and related industries
that require vacuum equipment, rapid technologicalevolution is the key to survival. Cutting-edge needs
can be addressed only through development andproduction that are far more innovative than in the past.
The ULVAC Group, whose business is“manufacturing,” must constantly strive to enhance
its development and production potential in order
to continue to innovate those processes and thus
contribute to customers’ innovation. I believe thatthe key is to unleash this potential in the form of
manufacturing capabilities emphasizing “power,”“speed,” and “flexibility.”
Human resources are the wellspring of strengthened“power.” It is important for ULVAC to persistently
develop people from a truly global perspective
who are committed to technological development
and production of “No. 1 and Only One” in theworld. Above all, it is essential to develop leaders indevelopment and production whose strong owner’s
mindset and multifaceted vision enable them to build
teams. With this in mind, ULVAC should spare no effort
in supporting human resources development. Those
involved in development and production should haveas many opportunities as possible for external technicalexchanges and interactive contact with users from theearly phase of their careers, cultivate the expertise thatwill enable them to compete globally, and demonstrate
their capabilities in the world.
In addition, to further accelerate the “speed” ofdevelopment and production, internally ULVAC needs

47

ULVAC VALUE REPORT 2022

to strengthen its human resources and technology
assets and promote exchanges of engineers within theGroup, while externally engaging in open innovation
with relevant organizations and pursuing technology
alliances. In some cases, ULVAC may need to invest
vigorously through M&A to strengthen marketing aswell as development and production capabilities.
Clearly, in order to respond swiftly and effectively
to rapidly changing needs, it is important to select andimplement “flexible” and efficient paths to successaccording to the situation without hesitation, whether it
be in cutting-edge marketing, development, production,or sales.
Innovation is easier said than done. In particular, thedead hand of corporate inertia can make it extremely
difficult to advance beyond stereotypical behavior.
Hence, my conviction is that it is essential to returnto the essence of development and production byrecognizing anew the basics in order to develop andproduce products attuned to user needs, accumulate
incremental innovations in all processes, and forge a
new value creation chain leading to a bright future handin hand with users.
In this 70th anniversary year, I am keenly anticipating
ULVAC’s next dynamic round of development centeringon vacuum technology and the related application
technologies, supporting the foundation of society
through the development of industry, science, andtechnology over the next quarter of a century.

For ULVAC, whose business operations extend acrossthe globe, the “people” involved in this endeavor are amajor factor in transforming the potential of “vacuum”
into an everyday reality. ULVAC should take pride in
the fact that “people” are at the heart of its founding
philosophy.
With an eye to the society of the future, despite thedifficulty of prediction, we need to reaffirm the need for
management that strongly takes into consideration not
only ULVAC’s employees, their families, people in local
communities, and the companies with which ULVAC
collaborates but also “society,” transcending national
borders and languages. This is crucially important interms of taking responsibility for the future.
How can ULVAC build an organization in whichpeople can engage with joy and conviction, withawareness of “contribution to the corporate purposeby themselves and their team”? And how can ULVAC
ensure that everyone involved in this endeavor
comprehends the importance of continuing to buildand operate this enterprise and how should ULVAC
communicate to external parties what it is doing?
For the ULVAC Group to continue to be sought after
by individuals and society in the future, it is necessary

not only to cherish the strengths but also to introduce
external viewpoints so that the employees are keenly
aware that the Group needs to be an enterprisecapable of anticipating society’s needs and nurturing
human resources who can make a change for the
better. I sincerely hope that everyone at the ULVACGroup will take ownership, think about what theyshould do, and act accordingly.
In formulating Vision 2032, young employees inJapan and overseas played a central role, engaging
in in-depth discussion across companies andorganizations. I highly regard this process as amilestone on the path to diversity and inclusion.
For the ULVAC Group, which is developing businessglobally with cutting-edge technologies, to continue
to grow, it must be involved in the well-being of its
employees, in addition to improving the personnel
system to meet the needs of the era. I look forward toseeing ULVAC promote activities among employees,
transcending organizational and regional boundaries, aswell as exchanges with companies and organizations
outside ULVAC from a global perspective and further
enhance corporate value.

ULVAC VALUE REPORT 2022

48

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Management Structure
Directors
Setsuo Iwashita

Mitsuru Motoyoshi

Norio Uchida

Dr. Kozo Ishida

President and Chief Executive Officer

Director and Executive Vice President

Director

Director

External

Expertise/
experience

March 1984
August 1992
September 1995
July 1998
March 2006
October 2006
September 2011
July 2012
September 2013
July 2015
July 2016
September 2016
July 2017
January 2019
July 2020

Corporate
management

GlobalSales/
marketing

Joined the Company
Manager of Beijing Business Office and Shanghai Business Office, Overseas
Operation Division
Director and Chief Executive Officer of ULVAC (NINGBO) CO., Ltd.
General Manager of Chinese Region, Asia Division of the Company
Director and Chief Executive Officer of ULVAC (CHINA) HOLDING CO., LTD.
Chairman of ULVAC (Shanghai) Trading Co., Ltd.; Chairman of ULVAC (SUZHOU)
CO., LTD.
Director of the Company
Director and Executive Officer
Managing Executive Officer
Senior Managing Executive Officer of the Company; Chairman of ULVAC(CHINA) HOLDING CO., LTD.
Senior Managing Executive Officer and Senior Manager of Management
Planning Department of the Company
Director and Senior Managing Executive Officer, Senior Manager ofManagement Planning Department
President and Chief Executive Officer
President and Chief Executive Officer and General Manager of Human Resource
CenterPresident and Chief Executive Officer (current position)

Expertise/
experience

April 1980
July 2000
September 2005
July 2010
July 2012
July 2013
July 2014
July 2015
July 2017

July 2018
January 2019
July 2019
January 2020
July 2020

July 2019
July 2020
July 2021

Finance/accounting

Expertise/
experience

April 1973
June 1980
February 1989
October 1994
July 1999
June 2003
July 2003
June 2005
June 2007
June 2010
June 2011
June 2013
June 2015
September 2015

Corporate
management

External

GlobalHiroyuki Nishi

Yoshimi Nakajima

Senior Managing Director

Director

Director

Corporate
management

Global

R&D/technology/
manufacturing

Joined the Company
Joined ULVAC KOREA, Ltd. as Senior Director
President of ULVAC KOREA, Ltd.
Executive Officer of the Company
Managing Executive Officer
Chairman of ULVAC KOREA, Ltd. (current position)
Managing Executive Officer, Senior General Manager of R&D Headquarters of
the Company
Director and Managing Executive Officer, Senior General Manager of R&D
Headquarters
Director and Managing Executive Officer, General Manager of Innovation Centerof Excellence
Senior Managing Director (in charge of Innovation) of the Company; President
and Chief Executive Officer of ULVAC-PHI, Inc.
Senior Managing Director (in charge of Innovation) of the Company; Chairmanof ULVAC-PHI, Inc. (current position)

Expertise/
experience

April 1983
March 2007
March 2010
July 2011
March 2014
March 2017
March 2018
March 2018
March 2020
April 2020
September 2020

Independent

Corporate
management

External

GlobalLegal affairs/riskmanagement

Joined Nippon Life Insurance Company
General Manager of International Planning & Operations Dept. and General
Manager of China Office
Executive Officer, General Manager of Europe, Deputy Director-General andGeneral Manager of London Representative OfficeDirector and Executive Officer, General Manager of the Americas, General
Manager of Europe, Deputy Director-General, and General Manager of New
York Representative OfficeDirector and Managing Executive Officer, General Manager of International
Planning & Operations Dept., General Manager of the Americas, General
Manager of Europe, and General Manager of Asia
Director and Senior Managing Executive Officer, General Manager of theAmericas, General Manager of Europe, and General Manager of Asia
Director
President and Chief Executive Officer of Nissay Asset Management Corporation
Advisor of Nissay Credit Guarantee Co., Ltd.
President and Chief Executive Officer (current position)
External Director of the Company (current position)

Expertise/
experience

April 1980
February 1982
May 1997
June 2000
April 2002
August 2011
February 2014
April 2014
June 2017
June 2018
September 2018
April 2021

Sales/
marketing

Joined Tokyo Optical Co., Ltd. (currently TOPCON CORPORATION)
General Manager of Topcon Singapore Pte. Ltd.
President of Topcon Australia Pty Ltd.
Senior Vice President of Topcon Laser Systems, Inc. (currently Topcon
Positioning Systems, Inc.)
President of Topcon Laser Systems Japan, Inc.
Executive Officer of TOPCON CORPORATION
Director and President of Topcon Sales Corporation (currently TOPCON SOKKIAPOSITIONING JAPAN CO., LTD.)
Director and Executive Officer of TOPCON CORPORATION
Director and Managing Executive Officer
Director and Senior Managing Executive Officer
Representative Director, President & CEO
Advisor to the Board
External Director of Nabtesco Corporation (current position)
External Director of the Company (current position)

Dr. Choong Ryul Paik

Expertise/
experience

September 2018

GlobalJoined the Company
Senior Manager of Accounting Department
Director and Senior Manager of Accounting Department
Director and Senior Manager of Management Planning Department
Director and Executive Officer, Senior Manager of Management Planning
Department
Chairman of ULVAC TAIWAN INC.
Director and Managing Executive Officer, Senior Manager of Management
Planning Department of the Company
Director and Senior Managing Executive Officer, Senior Manager ofManagement Planning Department
Director and Senior Managing Executive Officer, Senior General Manager
of Business Strategy Headquarters of the Company; Chairman of ULVAC(Shanghai) Trading Co., Ltd.; Chairman of ULVAC (SUZHOU) CO., LTD.; Chairmanof ULVAC SINGAPORE PTE LTD; Chairman of ULVAC MALAYSIA SDN. BHD.
Director and Executive Vice President of the Company
Chairman and Chief Executive Officer of ULVAC (CHINA) HOLDING CO., LTD.;
Chairman of ULVAC Automation Technology (Shanghai) Corporation
Director and Executive Vice President, General Manager of Management
Empowerment Center of Excellence of the Company, responsible for associatecompanies; Chairman of ULVAC Tianma Electric (Jingjiang) Co., Ltd.
Chairman of ULVAC (CHINA) HOLDING CO., LTD.
Director and Executive Vice President (in charge of Group companies) of theCompany (current position)

External

April 1991
September 1999
September 2000
September 2012
July 2015
September 2016
July 2018

Corporate
management

Independent

Expertise/
experience

March 1970
June 1982
March 1985
June 1988
June 1991
June 1996
July 2001
June 2002
June 2005
March 2011
March 2014
March 2016
September 2016
March 2017
April 2018

Independent

Corporate
management

Global

R&D/technology/
manufacturing

Joined HORIBA, Ltd.
General Manager of Product Department I, Development and Sales Division
President and Director of HORIBA Europe GmbH (Germany)
Director of HORIBA, Ltd.
Managing Director
Senior Managing Director
President and Director (CEO) of ABX, S.A. (currently HORIBA ABX SAS) (France)
Vice President and Director of HORIBA, Ltd.
Executive Vice President and Representative Director
Director and Advisor of HORIBA STEC Co., Ltd.
Vice Chairman and Representative Director of HORIBA, Ltd.
Senior Advisor
External Director of the Company (current position)
External Director of Seiko Electric Co., Ltd. (current position)
Fellow of HORIBA, Ltd.

Independent

Corporate
management

GlobalSales/
marketing

Joined The Yasuda Trust and Banking Co., Ltd. (currently Mizuho Trust &Banking Co., Ltd.)
Joined AVON PRODUCTS CO., LTD.
Joined Citibank, N. A. as Vice President
Joined Societe Generale Securities Services as Senior General Manager
Joined American Express International, Inc. as Vice President in charge of
Global Traveler’s Check & Prepaid Card Service, Japan Branch
Country Manager in Singapore (President)
Senior Vice President of Japan BranchPresident and Representative Director of American Express Japan Co., Ltd.
External Director of Yamaha Corporation; External Director of AEON Financial
Service Co., Ltd. (current position)
External Director of Japan Freight Railway Company (current position)
External Director of the Company (current position)
Outside Director of Sekisui House, Ltd. (current position)

Auditors
Makoto Ito

Kazuya Saito

Senshu Asada

Isao Utsunomiya

Auditor

Auditor

Auditor

AuditorExternal

Expertise/
experience

April 1984
March 2008
March 2012
April 2015
September 2015

Finance/accounting

Legal affairs/riskmanagement

Joined Nippon Life Insurance Company
General Manager of 1st Osaka Corporate Finance Dept. and Kyushu Area
Corporate Finance Dept.
General Manager of Metropolitan Area Corporate Finance Dept.
Joined the Company. Counselor to Senior Manager of Management Planning
Department
Full-time Auditor (current position)

Expertise/
experience

April 1983
July 1996
October 2000
July 2005
September 2009
July 2012
September 2013
July 201849

ULVAC VALUE REPORT 2022

July 2021
September 2022

R&D/technology/
manufacturing

Joined the Company
Manager of Vacuum Materials Laboratory, Tsukuba Institute for Super Materials
Senior Manager of No. 3 Research Department, Chiba Institute for Super Materials
General Manager of Chiba Institute for Super Materials
Director, General Manager of Chiba Institute for Super Materials
Director and Executive Officer, General Manager of Technology Planning Department
Executive Officer, General Manager of Technology Planning Department,
General Manager of Institute for Super Materials
Senior Executive Officer, General Manager of Institute for Semiconductor andElectronic Technology
Officer, Assigned to Strategic Planning Department
Full-time Auditor (current position)

Expertise/
experience

April 1977
October 1996
June 2001
September 2007
April 2012
March 2014
June 2017

Independent

External

Legal affairs/riskmanagement

Registered as an attorney. Joined the Daini Tokyo Bar Association
Jointly established Koju Law Firm
External Audit & Supervisory Board Member of HIMIKO Co., Ltd.
External Auditor of the Company (current position)
Auditor of Judo Federation of Tokyo (current position)Councilor of All Japan Judo Federation
External Director of Ahkun Co., Ltd. (currently Fuva Brain Limited)

Expertise/
experience

April 1997
July 1999
June 2011
June 2012
June 2013
June 2015
June 2017
September 2017
June 2019

Independent

Finance/accounting

Registered as Certified Public Tax Accountant
Opened Isao Utsunomiya Certified Public Tax Accountant Office
Manager of Welfare Department of Kyobashi Branch, Tokyo Certified Public Tax
Accountants’ Association
Representative Partner of Tsukiji Accounting Tax Corporation (current position)
Director of Tokyo Certified Public Tax Accountants’ Association
Director and Deputy Manager of General Administration Department
Manager of General Administration Department of Kyobashi Branch
External Auditor of the Company (current position)
Deputy General Manager of Kyobashi Branch, Tokyo Certified Public Tax
Accountants’ Association (current position)ULVAC VALUE REPORT 2022

50

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Risk Management
Management of Risks
The ULVAC Group considers that responding appropriately to increasingly complex and diverse risk factors leads
to the creation of governance structures that contribute to the fulfillment of legal requirements and the creationof internal control structures, and by extension, the medium- to long-term improvement of corporate value.
We are expanding systems that can respond appropriately to risk factors through identification, classification,
analysis, and evaluation, and we are working to increase corporate value by reflecting them in our management
strategy.

Principal risks are identified that may have a significant impact on financial position, business results, andcash flows and are described below. ULVAC examines measures to reduce these risks and utilize them asopportunities through discussion at a decision-making body such as the Board of Executive Officers.

Risk Management System

Market Fluctuation

Global Competitive Environment

We have acquired our market share and achieved
growth by developing unique technologies andintroducing them in the field of vacuum equipmentused, in particular, in FPD, semiconductor, andelectronic device production processes. On the other
hand, if a great reduction in capital investment occurs
or customers’ financial conditions deteriorate owing tochange in the market conditions of FPD manufacturers,
or semiconductor and electronic device manufacturers,
who are the Group’s customers, the Group’s businessresults and financial position may be adversely affected.
In this regard, in the current mid-term management
plan launched in July 2020, the Group set a twofold
basic policy: “investment in development for growth(selection and concentration)” and “profit-oriented
management through structural change.” Under thebasic policy, even in the case of market fluctuation,ULVAC aims to improve profitability by enhancing
productivity and achieve sustainable growth by focusing
on development in growth fields. Our diverse products
are used in a wide range of fields. We will enhance ourability to respond to market fluctuations by building astable revenue base, centering on the semiconductor
and electronic component fields.

We operate business globally and provide products
to customers in various countries and regions,but competitors also operate globally, and it is acompetitive environment with new entrants. In suchan environment, competition is intensifying not only interms of product performance but also price, and the
ULVAC Group’s business results and financial position
may be adversely affected. The Group is striving tomaintain competitiveness by sharing its technology
and product roadmap with customers and launchingproducts using cutting-edge technologies at theappropriate time.

We have established rules concerning the risk
management system, classifying a broad range of risks
from various perspectives, and designated the control
offices primarily responsible for risk management
according to the classification of risks. Furthermore,these risk control offices identify more specific risks
and respond to them. We work to ensure that theseoffices efficiently gather information that is importantfor operating the risk management system. In
addition, in order to share and evaluate information
concerning the operation of the risk management
system on a company-wide basis, we have a Risk
Management Committee, which is chaired by thepresident, and mainly comprises representatives of
the risk control offices with primary responsibility forrisk management. The Risk Management Committee
holds regular meetings as an umbrella organization forrisk management, and it determines company-wide
basic policies, monitors the state of management andadministration, and considers any improvements thatcan be made, etc. Furthermore, initiatives at ULVAC,
Inc. are implemented at ULVAC Group companies asappropriate for the scale and business type of thecompany in question.

Risk Management System

ULVAC, Inc.

ULVAC Group companies

Chief Risk Officer =President and CEO

Risk Management Committee

Risk
control
officeRisk
control
officeChief Risk Officer =President and CEO

Reportingandinstructionsfor
improvement

Risk
control
officeResearch and Development

Risk Management Committee

Risk
control
officeRisk
control
officeRisk
control
office isk control offices are designated according to risk classifications and they implement risk managementRthrough a PDCA cycle.
Each Group company decides whether it is necessary to establish a Risk Management Committee inconsideration of the size of the company in question and other factors.

By maintaining vigorous R&D investment, we havecontinued to introduce a stream of new productsthat incorporate the latest technologies. However, if
development is significantly delayed for a compelling
reason, resulting in delay in introduction of new
products to the market, the Group’s business results
and financial position may be adversely affected.
ULVAC is accelerating development, which
is necessary for growth, through selection andconcentration of investment. At the same time, periodic
monitoring is implemented for progress management inorder to prevent significant delay in development.

Supply Chain
The Group’s business results and financial position may
be adversely affected if prices of parts soar or supply
delays occur due to tight supply and demand for parts
used to manufacture products or if production activities
are halted or delayed due to supply chain disruptions
caused by a large-scale disaster and other incidents.
The Group strives to secure necessary parts by
establishing systems for cooperation with suppliers andarranging for parts at an early stage.

Major Risks That May Have Significant Impacts
on Business
Fluctuations in FPD, semiconductor, andelectronic device markets
Delays in research and development
Intensifying global competition
Continuous securing of human resources
Tight supply and demand for parts in the supply
chain
Violation of laws and regulations
Quality defects
Securing of funds by borrowing, etc.
Leakage of confidential information
Sharp currency fluctuations
Infringement of intellectual property rights
Occurrence of safety-related accidents
Violation of environmental regulations
Spread of COVID-19

51

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

52

Strengthening of Foundation for Value Creation

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Compliance

Human Rights

We emphasize not only compliance with laws and regulations but also compliance with internal codes andethical codes. As well as conducting awareness-raising activities so that each person in the ULVAC Group actswith a spirit of compliance, we have established and are operating a range of institutions and regulations toensure thorough compliance.

We believe that consideration for human rights is an important management issue in the context of further global
business development. We support international norms and are strengthening promotion of the protection of andrespect for human rights. Moreover, we respect fundamental human rights based on the laws and regulations ofeach country and region.

Corporate Code of Conduct

Compliance Education

Approach to Human Rights

In order to further promote fair and highly transparent
corporate management, ULVAC has established a
Corporate Code of Conduct comprising 18 items,
conducted education, and distributed booklets toinculcate a culture of compliance. The Corporate Codeof Conduct includes this statement: “ULVAC’s officers
and employees shall always pay attention to social
trends, enhance their own sense of ethics, and act
sensibly with the awareness that they are membersof ULVAC as well as ofsociety.” We use thisCorporate Code of Conduct
as guidelines for asking
ourselves whether ourbusiness conduct is “inthe best interest of ourcustomers,” “correct in lightof laws and social ethics,”
and “does not infringe
human rights.”

Amid a changing social environment, we conductperiodic or ad hoc company-wide education oncompliance, prevention of insider trading, preventionof harassment, prevention of misconduct in research
activities, etc., to raise awareness not only in terms
of knowledge but also to enable our employees to act
appropriately.

ULVAC has been a signatory to the United Nations
Global Compact, which is a global initiative, and is
promoting initiatives in the areas of human rights, labor,
environment and anti-corruption based on “The Ten
Principles of the UN Global Compact” that are universal
principles to be adhered to by companies in these fourareas.
ULVAC has established the Corporate Code of
Conduct as guidelines for all officers and employees
to keep in mind so as to ensure their work does not
infringe human rights. In response to recent changes
in awareness and issues regarding human rights in theinternational community, ULVAC has formulated the
ULVAC Human Rights Policy based on international
norms. As a company that conducts business globally,
ULVAC will, in accordance with this policy, promotebusiness activities that respect human rights morethan ever before, based on a clear and common
understanding of how human rights should be
respected in business activities.

Corporate Code of Conduct

53

Introduction

Whistleblowing System
In addition to a whistleblowing system operated via
the Manager of the Internal Auditing Department for
which independence is secured in accordance with theWhistleblower Protection Act, we have also establishedan external whistleblowing contact. The Manager of
the Internal Auditing Department also serves as thesecretariat for the Compliance Committee, and thesystem is structured such that confidentiality is ensured
throughout the process of investigating the content ofreports. By putting in place a whistleblowing systemthat allows whistleblowers to feel secure in theirreporting, we aim to detect any misconduct early andtake appropriate corrective action.
After a whistleblower report has been received,
the initial response is for the Compliance Committeeof ULVAC, Inc. to conduct an investigation in order toestablish the facts. This investigation is particularly
mindful of fairness, and is conducted judiciously andthoroughly. If necessary, assistance may be soughtfrom external experts, and thorough interviews thatare as wide-ranging as necessary are conducted andanalyzed.
The president chairs the Compliance Committee andthe members of the Committee observe a strict duty ofconfidentiality in carrying out their duties.

1

Excellent Products, Services, and Safety

2Sound, Corporate Association with Business Partners
and Affiliated Companies

3

Promotion of Maintenance of Fair and Free Competition

4

Protection of Intellectual Property Rights

5

Corporate Secrets

6

Client Information

7

Respect for Employees’ Personality and Individuality

8

Respect for Privacy

Handling of Violations

9

Respect for Human Rights and Nondiscriminatory
Treatment

10

Assurance of Safe and Healthy Work Environment

11

Compliance with Laws or Ordinances

12

Insulation from Antisocial Forces

13

Disclosure of Information

14

Global Environmental Protection

15

Local Contribution

16

Global Business Activities

17

Thorough Implementation of Corporate Ethics

In the event that, based on the results of aninvestigation by the Compliance Committee, it isdeemed that a violation of laws or regulations has beencommitted, then the opinion of an external expert,
such as a lawyer, may be sought as necessary, steps
will be taken to ensure that the violation ceases withimmediate effect and improvement measures will be
implemented, and those involved in the violation will be
dealt with after deliberation by the appropriate bodies.
In addition, the root causes of the violation are also
investigated in order to formulate effective measures forpreventing recurrence.

18

Pronouncements by Individuals

ULVAC VALUE REPORT 2022

Corporate Code of Conduct (Excerpt)
7. Respect for Employees’ Personality and Individuality
Based on the respect for personality and the individuality of each of
our employees, ULVAC will make an effort to upgrade and maintainthe personnel system, labor conditions, and the fluid system wherein
workers may achieve affluence and a sense of accomplishment. Also,
we will evaluate personnel objectively and fairly, fostering creative
human resources with expertise and rich individuality at the same time.
9. Respect for Human Rights and Nondiscriminatory Treatment
ULVAC will assure a healthy work environment where both harassment
and discrimination are never acceptable for reasons of race, credo,
complexion, sex, religion, nationality, language, bodily features anddescription, handicap or not propertied or not, location or birthplaceand sexuality. Also ULVAC will take no involvement in forced labor andchild labor. ULVAC will especially strive to prevent sexual harassment,
coercion, abuse, or harassing behavior by taking advantage of
workplace authority and job function (harassment through official
authority). In the event of such a problem, we will immediately andpromptly start an investigation to take resolute action for relief of thevictim and prevention of a recurrence.
11. Compliance with Laws or Ordinances
Law on Occupational HealthWith the cooperation of all employees, ULVAC will perform health andsafety activity through risk assessment and will ensure compliance tothe occupational safety and health related laws and ULVAC occupational
health and safety relevant provisions. ULVAC will provide safe products
and services to users implementing product risk assessment andensure compliance to various safety standards.

For details

Website >> Sustainability > Human Rights

Approach to Human Rights
The Corporate Code of Conduct specifies policies
on respecting the personality and individuality of
employees. In accordance with the Corporate Codeof Conduct and the Basic Policy for Human Resources
Development, we are striving to create workplaces

offering job satisfaction. Furthermore, we are also
striving to provide safe products and services tocustomers by engaging in safety and health activities
based on laws and regulations, complying with safety
standards and performing risk assessment of our
products.

Reporting and Consultation Desk for Human
Rights Issues
We have adopted a whistleblowing system operated
via the Manager of the Internal Auditing Department for
which independence is secured.
The Compliance Committee will implement
appropriate measures with adequate consideration
for confidentiality, anonymity and protection ofwhistleblowers, and strive to promptly resolve issues
and prevent their recurrence.

Freedom of Association
ULVAC has concluded labor agreements with labor
unions and promised to sincerely work together
with them to adhere to these agreements in orderto establish and develop labor-management relations
based on mutual faith and trust. Furthermore, we
engage in close dialogue with labor unions on
management plans and measures, in addition to labor
conditions.

Supply Chain Initiatives
We endeavor to comply with the RBA Code of
Conduct, which is a CSR promotion group focused on
the electronics industry. In addition to implementing,evaluating and correcting self-evaluations andthoroughly managing labor hours at major production
bases, we request business partners to work withus on these initiatives. We conducted questionnaire
surveys mainly for major business partners and haveincorporated the questionnaire items into the evaluation
at the time of periodic renewal. Furthermore, we haveestablished a policy on the handling of conflict minerals
and conduct due diligence.

Due Diligence on Human Rights
We have incorporated international norms into the
ULVAC Human Rights Policy and have establishedhuman rights due diligence processes according to theprocedures corresponding to the international norms.
We are making an effort to further strengthen relief
mechanisms by recognizing, preventing, and addressing
negative effects that may have on human rights throughbusiness activities.
ULVAC VALUE REPORT 2022

54

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Human Resources
To achieve sustained growth, dynamic organizations must serve as a foundation enabling diverse humanresources to fulfill their potential. Despite the impact of COVID-19 in FY 2021, we created educational
opportunities, holding online training and making greater use of our unique Learning Management System(ULVAC Academy Portal) than previously.
ULVAC will step up its engagement in organizational and human resources development more than ever,focusing on securing and cultivating tomorrow’s leaders to strengthen the management base.

Basic Policy
Amid intensifying global competition, with overseas
sales accounting for 70% of total sales, in order toachieve sustainable growth of its businesses, the
ULVAC Group needs to cultivate an environment where
people with diverse personalities and strengths canmaintain physical and mental health, bring their differing
capabilities into full play, and enhance one another’seffectiveness through friendly competition.
In the ULVAC Group, people with different
backgrounds, in terms of nationality, ethnicity,
philosophy, culture, language, gender, age, andspecialty, are flourishing. We respect such diversity andpromote inclusion, innovating to resolve customers’
and society’s issues. By doing so, we aim to continue
delivering new value that also leads to the personal
growth of each employee.
Based on this approach, we are reinforcing thedevelopment of global human resources who areresilient to changes in the external environment andcapable of working globally with an eye to the futurefrom a broad perspective including the planet, society,markets and customers.

participation of the entire workforce of the ULVACGroup in UL-GAIA. ULVAC has long been engaged in
activities to deepen penetration of the Basic Corporate
Philosophy, the Business Philosophy, and the Employee
Principles. Nevertheless, with a view to ensuring
ULVAC’s sustainable growth amid intensifying global
competition, we believe it is essential that our diverse
workforce have a sure grasp of the Basic Corporate
Philosophy, etc., take them to heart, apply them, share
best practices, and encourage one another to excel.
We are working to further strengthen our managementbase by maintaining the tempo of the UL-GAIA
initiatives.
Owing to the COVID-19 pandemic, UL-GAIA 2021
was held as a hybrid event, combining online andin-person participation, as in the previous year. The
number of entries tripled compared to FY 2020, owing
to the change of the theme. The teams selected fromthese entries by screening in each country and region
made memorable presentations expressing theircommitment and creativity. Specifically, the change ofthe theme to “putting into practice the Basic Corporate
Philosophy, the Business Philosophy, and the Employee
Principles” resulted in expansion of the scope of theactivities featured at UL-GAIA. In addition to value
creation through improvement and reform of value chain
processes, maximization of synergy across the Group,and strengthening of cross-functional support andsolutions for issues affecting multiple Group companies,
all of which are in line with the previous theme of“Production Technology/Manufacturing Technology/
Business Improvement,” entries at UL-GAIA 2021
included activities designed to resolve social issues. By
sharing the outcomes (benefits) of these activities andthe process of problem solving throughout the Group,
we aim to ensure that the entire workforce is fully
aware of the importance of putting into practice the
Basic Corporate Philosophy, the Business Philosophy,
and the Employee Principles in their work. Furthermore,through horizontal deployment of the best practices
presented, we aim to link them to further growth of the
ULVAC Group.

Selection Process

Basic Policy for Human Resources Development
We are conscious that the most important resources for corporate vitality and competitiveness are thepersonnel and the organizations in which they work. We are conducting the following human resources
development, based on the Basic Corporate Philosophy and the Management Policies.
1. Human resources who respect other individuals,
trust each other and fulfill their responsibilities
2. H uman resources who can see the true nature ofeach issue and create revolutionary technologies andprojects with passion and tenacity

3. H uman resources who are full of aspirations toimprove themselves and take voluntary actions toachieve goals
4. H
 uman resources who have a global perspective andaim to take leadership in exploring the world

Putting into practice the Basic Corporate
Philosophy, the Business Philosophy, andthe Employee Principles

Regional screening

Japan

Screening at eachcompany

UL-GAIA 2021
ULVAC holds UL-GAIA to ensure that employees shareand put into practice the Basic Corporate Philosophy,
the Business Philosophy, and the Employee Principles,and furthermore, to commend their activities andrecognize outstanding achievements. UL-GAIA is
the acronym of ULVAC Global Awards of Improved
Achievement. Likening the ULVAC Group to Gaia (theEarth), UL-GAIA reflects our desire to create an award topromote Group-wide unity worldwide and to combine
our energy and expertise so as to put into practice the
Basic Corporate Philosophy, the Business Philosophy,
and the Employee Principles.
Until FY 2020, the theme of UL-GAIA wasproductivity improvement, but from FY 2021, ULGAIA was repurposed as an “opportunity to share thebest practices corresponding to the Basic Corporate
Philosophy, the Business Philosophy, and the Employee
Principles,” thus promoting their deeper penetration
since they embody the ULVAC Group’s shared values
and its orientation, and ensuring the wholehearted
55

ULVAC VALUE REPORT 2022

Putting into practice the Basic
Corporate Philosophy, theBusiness Philosophy, and the
Employee Principles

Sharing
Horizontal
deployment

Competitions*The three lines of the logo
symbolize the Basic Corporate
Philosophy, the Business Philosophy,
and the Employee Principles.

Training
Daily business

Administration

Engineering

Skills

China

South
Korea

TaiwanGroup companies

Europeand North
AmericaSoutheast
Asia
Participants at UL-GAIA 2021

Education Center Established

Developing the Next Generation of Leaders

We established the Education Center in July 2022.
Although we have been conducting activities such as
visualization of human resources and other resources,
including those of Group companies since FY 2019,from now on we intend to promote global humanresources development and empowerment of diverse
human resources. For the ULVAC Group’s sustainablegrowth, people are the most important resource. Every
employee must be given opportunities and encouraged
to fulfill their potential by playing an active role in
the ULVAC Group. The Education Center provides awide range of opportunities and means for careerdevelopment so that each employee takes a proactive
and autonomous approach to one’s own career andpersonal growth, so that the employees’ personal
growth and the company’s growth will be linked morethan ever before.

ULVAC conducted the ULVAC Executive Program (UEP)with the aim of cultivating leaders who will persistently
and aggressively grapple with global change. The
participants selected from among candidates at ULVAC,
Inc. and domestic and overseas Group companies
participated in the program over a period of six months.
By combining UEP with the ULVAC Leadership Program(ULP), an education program for young leaders, we will
focus on developing the next generation of leaders.

Group-wide Level-specific Training and Training
for Managerial Personnel
Level-specific education starts with an introductory
program for new employees and includes a program for
employees in their third year and subsequent programs
according to internal qualifications and positions. We
continue to redesign our education system. Specifically,
we now provide training that runs for about six months
ULVAC VALUE REPORT 2022

56

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Human Resources

for newly appointed managerial personnel so that theycan equip themselves with the managerial skills andoperational knowledge they need as managers. To
revitalize organizations, we also offer communicationand management training for existing managerial
personnel. The objective is to help them in their efforts
to enhance their managerial capabilities so that they can
flexibly respond to various changes in workstyles, suchas the rise in working from home.

Manufacturing Education
Our vision is to offer a wealth of educational
opportunities covering the diverse techniques andskills essential for manufacturing throughout theGroup in a consistent and equitable manner. This wideranging education includes reskilling and the passing
on of skills from one generation to the next. We arefocusing on raising the level of the Group’s technicalcapabilities through education on the fundamentals
of manufacturing and vacuum technology, whichconstitutes essential knowledge for all ULVAC
engineers. Furthermore, for trainees from Group
companies in Japan and overseas, we have establisheda course that in a systematic manner covers ULVAC’s
history, culture, and management strategy as wellas other subjects. We are also promoting personnel
exchanges globally.

increase in mid-career hiring and the flow of humanresources among Group companies. Incorporating
methods such as blended learning, which combines
online training and group training, the portal has fulfilled
a particularly important role in promoting self-motivatedlearning during the COVID-19 pandemic. We are also
working to standardize training across the Groupand offer an environment in which anyone can learn
whenever they wish. Some 6,000 ULVAC employees
have registered and are using the portal, which now
supports Japanese, English, simplified Chinese,
traditional Chinese, and Korean, and currently offers
around 1,700 items of content.

Creating an Excellent Working Environment
Principal content

Philosophy
education

Message from the President
UL-GAIA presentation video
clips

Global education

Video clips of lectures andother internal seminars andonline lectures
Language education before
overseas assignment, culturaland history education
English education
In-house newsletters of Group
companies

Administration Education
We provide training for employees engaged inadministration so that they can acquire the basic
knowledge required for their roles step by step andbecome adept. The program is designed to help trainees
acquire a wide range of knowledge on such mattersas economic and business trends, company policies
and the mid-term management plan, basic knowledgeof accounting and taxation, corporate governance, andthe Companies Act, and also encourages them to takeownership of their education and training, showing
initiative and pursuing personal growth with a view tothe next stage of their career.

Mandatory
education

Specialized
education

Human Resources Rotation
We are vigorously promoting human resources rotationin the Group, especially between ULVAC Head Officeand overseas Group companies, as a measure topromote the diversity and inclusion mentioned above.
Moreover, by vigorously promoting assignment of
ULVAC employees to companies outside the Group on
loan and vice versa, we are striving to vitalize humanresources and establish human networks while also
expecting to achieve innovation through technicalexchanges.

ULVAC Academy Portal
Launched in 2016, the ULVAC Academy Portal offersand develops programs that can flexibly respond to the57

ULVAC VALUE REPORT 2022

in order to achieve “our goal for 2050.” Members of thesubcommittee are drawn from various departments androles, vary in age and genders are fully represented.
They discussed various themes such as “how toraise awareness, how to promote diversity, and how
to create a comfortable working environment andflexible workstyles necessary for promoting diversity”
over a period of six months and drafted a proposal of
concrete measures and presented it to management asa series of recommendations. The Human Resources
Subcommittee is currently addressing the issue of how
best to implement the proposed measures.

General education

 LVAC service safetyU
education, basic courseon machine safety, basic
education on product safety,etc.
Compliance education,
research ethics education,
basic environmental andsafety education, traffic safety
education, etc.
 ducation linked to internal
E
qualification systems such as
for trade and security tradecontrolEngineering education on
development, technology,
design, production, etc.,
including manufacturing
education
 ducation on healthEpromotion

Human Resources Subcommittee
We have established the Human Resources
Subcommittee consisting mainly of young employees
to thoroughly examine initiatives for sustainable
management from the viewpoint of human resources

We are creating a working environment in which
employees can demonstrate their strengths andoriginality while enhancing their productivity.
Furthermore, we are developing conditions andprograms that minimize the impact of life events, sothat diverse human resources can flourish and perform
well.

Improvement of Systems for Flexible Workstyles
ULVAC, Inc. offers a staggered working hour system
and a flextime system. We also introduced an hourly
annual paid leave system in 2020 that is used by many
employees. The average number of days of annual paid
leave taken is 12.3. We have also taken steps such as
the introduction of shortened working hours and theestablishment of satellite offices.
Many employees take advantage of systems suchas childcare leave, the short-working-hours system forchildcare, and nursing care leave. In order to facilitate
the use of the systems, we are publicizing the systems
by holding meetings to explain the details of thesystems, including through the use of explanatory
videos.

Retention of Human Resources and Transfer ofTechnological Expertise
Mindful that technological innovation is triggered by the
integration of accumulated technology, new knowledge,
and creativity, ULVAC emphasizes human resources
development, the retention of employees, and thetransfer of technological expertise. Specifically, we
conduct a questionnaire survey of new employees six
months after they join ULVAC, Inc. and their superiors,
and any gaps in perception are promptly addressed.
The system for rehiring senior employees after
mandatory retirement has taken root, and furthermore,
we have set up a special employee system for postretirement senior employees (after retirement at theage of 65) to create an opportunity for experienced
employees to display their abilities and transfer theirtechnological expertise to the next generation.

Promotion of Diversity
We believe that active participation of women is a
key issue as we aim to create an environment inwhich diverse human resources can exhibit theirskills and grow. We have launched a project involving
activities to promote the active participation of women,
which is collaborating with the Human Resources
Subcommittee. Initiatives include the holding of events
at which management and female employees can
exchange opinions and ideas.

Employment of People with Disabilities
We proactively employ people with disabilities, andpeople with a variety of disabilities work at ULVAC.
They aim to achieve personal growth and contribute tobusiness, and by accumulating experience they havebecome indispensable in the workplace. After theyjoin the company, ULVAC works with job assistanceorganizations, conducts regular interviews, offers
support in the departments where they work andmakes improvements to the working environment,
providing follow-up according to the characteristics ofeach disability to ensure each employee becomes wellestablished in the workplace. In addition, students withdisabilities are also accepted from local educational
institutions for on-the-job training.

Human Resources Data
Employee gender ratio
Male

FemaleFemale

Male

15.6%

84.4%

971
employees

5,264
employees

Management gender ratio
Male

FemaleFemaleMale

124
employees

1,488
employees

7.7%

92.3%

ULVAC VALUE REPORT 2022

58

Strengthening of Foundation for Value Creation

Promotion of
Health andProductivity
Management
Priority Activity

Making further progress in creating a working environment that enables employees
in excellent physical and mental health and good spirits to demonstrate their abilities
to the fullest is important for the ULVAC Group’s future development. At ULVAC,
Inc., the president, the Chief Health Promotion Officer, the senior manager of theGeneral Administration Department, the senior manager of the Personnel Department,
occupational health physicians, and occupational health nurses act in unison to promotehealth and productivity management activities. In addition to legally prescribed healthchecks, stress checks, and face-to-face guidance for employees who work long hours
by an occupational health physician, the Company pursues initiatives for general healthimprovement, such as wellness improvement and reduction of health risks.

Health Risk Reduction

Our health risk reduction target is “Health age*2 3.0
years lower than actual age by FY 2025.” Programs
available for all employees of ULVAC, Inc. include
online education programs covering long working
hours, nutrition, women’s health, and preparation for
health checks, and a walking program that utilizes
the PepUp healthcare platform. Thanks in part to theeffects of these measures, the health age of employees
is gradually improving (Fig. 2). We will continue to
implement measures to lower health age in future.
As a result of implementing these measures, ULVAC,
Inc. has been certified by the Ministry of
Economy, Trade and Industry as a 2022 CertifiedHealth and Productivity Management Organization(White 500) under the large enterprise category; theFig. 1 Work Engagement*1
1.20
1.15

1.14

1.16

1.17

1.18

1.18

59

Average in Japan*

2016

2017

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Occupational Safety and Health
The ULVAC Group has made “Safety First” the fundamental philosophy of business management. By operating
our Occupational Safety and Health Management System (OSHMS) focused on risk assessment, we endeavor toensure safety of the products and services used by our customers and create dynamic workplaces where Group
employees can work in good physical and mental health.

2018

ULVAC VALUE REPORT 2022

2019

2020

Fig. 2 Health Age
0
-0.5
-1

-0.8

-1.5
-2
-2.5

-2.1
2016

2021

(FY)

*1 Results of the Utrecht WorkEngagement Scale (UWES9) survey of ULVAC, Inc.
employees at the time of
applying for a medical checkup.
The figures for ULVAC, Inc.
employees on the basis thatthe average in Japan according
to Shimazu et al. (2014) is set
at 1.00. ULVAC, Inc. began
measurement in FY 2016.
*2 An index developed by JMDC
Inc. based on the medical
checkup data and medical
expenses of 1.6 million
people. ULVAC, Inc. began
measurement in FY 2016.
* Shimazu 2014; Shimazu et al. 2010

ULVAC Health Insurance Association has been certified
as a Certified Health and Productivity Management
Organization (Bright 500) under the SME category; andULVAC EQUIPMENT SALES, Inc., ULVAC CRYOGENICS
INCORPORATED, ULVAC TECHNO, Ltd., ULVAC-PHI,
Inc., TIGOLD CORPORATION, and REJ Co., Ltd. havebeen certified as 2022 Certified Health and Productivity
Management Organizations under the SME category.
ULVAC will continue pursuing various initiatives atdomestic Group companies to maintain and promote
the health of employees.

Approach to Occupational Safety and HealthAiming to Maintain Zero Accidents

In the execution of development, manufacturing,transport, installation, maintenance and other businessprocesses, everyone in the ULVAC Group, from senior
management to line workers, is encouraged to seize
the initiative in continuously undertaking improvements
placing the highest priority on safety, striving tomaintain and improve the safety of everyone involved
and ensure a healthy working environment.

To ensure the safety and good health of its customers
and employees, the ULVAC Group holds meetingsof the Global Safety Management Committee, twicea year and all Group companies promote safety andhealth activities in an integrated manner. Furthermore,
we have established a network of the safety personnel
in each Group company and promptly share, discuss or
implement safety information such as revisions of laws
and effective accident prevention measures.
Each Group company operates the OSHMS anddeclares safety based on management reviews
conducted by the president and other executives.
To ensure safety, every employee is engaged in
occupational safety and health activities through risk
assessments etc. We identify hazardous risks at thetime of work planning and implement measures before
commencement of work. The positive impact of thestrengthening of safety measures is apparent in thetrend of the frequency ratio of occupational accidents.

ULVAC Group Basic Policy on Occupational
Safety and Health Management System(OSHMS)
1. Compliance to the code/regulations, andimplementation of risk assessment
Comply with Codes of Occupational Safety & HealthManagement and Rules according to ULVAC’s
OSHMS, and conduct Risk Assessment in order toperform Occupational Safety & Health Management
activities with the help of all the employees.

ULVAC Group Safety Management System

2. Assure safety of ULVAC’s products
Comply with ULVAC’s standard for safety design andperform risk assessment of our products, in orderto deliver our safe products and services to ourcustomers.

2021

(FY)

Companies in Japan
Companies in South
Korea

President and CEOULVAC, Inc.

Global Safety
Management
Committee

Companies in Taiwan
Companies in China
Companies inSoutheast Asia

3. Planned education about Occupational
Safety & Health & Product Safety
For all the employees and contractor’s employees,
perform Occupational Safety & Health training basedon ULVAC Safety Management system, while offeringscheduled Product Safety training for our users.

Companies in Europe
and North America

Frequency ratio of occupational accidents at the ULVAC
GroupGroup as a whole

Japan

China

South Korea

Taiwan1.50

4. Promotion of mental health care
Promote mental health care to achieve a healthy,
vigorous workplace environment.

Through the Safety & Health promotion activities of
the Global Safety Management Committee, we will
try to create an appropriate work environment for thewhole ULVAC group and contribute to prosperity ofour businesses.

1.05

0.95

ULVAC’s Vision

5. Global expansion of ULVAC group
1.14

1.10

1.00

About ULVAC

Wellness Improvement

ULVAC, Inc. has set a wellness improvement target
of “An increase of at least 10% in work engagement
by FY 2025 compared with FY 2021.” The rate ofwork engagement at ULVAC, Inc. has been higher
than the average in Japan* but declined in FY 2021
compared with FY 2020 (Fig. 1). In order to overcome
the challenges, ULVAC, Inc. introduced a resilience
program for executives with the aim of forming habitsthat improve physical, emotional, mental and spiritualcondition. We also provide wellness support during
the COVID-19 pandemic by distributing to employees
information on subjects such as how best to physicallyand mentally cope with stress caused by change in theworking environment and on the promotion of good
habits. Going forward, the ULVAC Group will focus
on the implementation of measures to increase work
engagement.

Priority Activity

Introduction

1.00

1.05

1.00

0.92

0.87
0.54

0.50

0

2017

2018

2019

2020

2021

(FY)

*This graph shows the rate of occupational accidents for each fiscal year, withthe value for FY 2017 (as of June 2018) as 1.00. We have maintained a low
frequency ratio of accidents by preventing accidents through various safety
activities.

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60

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Quality Assurance and Product Safety

Procurement

The ULVAC Group is engaging in initiatives worldwide to meet customer expectations for high-level, safe ULVAC
quality through total quality management (TQM).

Suppliers are our important partners for manufacturing. We are working with them to enhance efficiency of theentire supply chain (from design, procurement, manufacturing, and sales, through to customer support), always
being conscious of the environment and society.

Quality Management Education

ULVAC Group Quality Policy

Improve quality & reduce costs and leadtime to half
Maximize profits and customer
satisfaction

Quality Assurance System
31 ULVAC Group companies are ISO9001: 2015
certified. The Global Quality Assurance Committee ledby the president of ULVAC, Inc. spearheads a Groupwide effort to align quality policies and is addressing
quality issues and deploying improvements globally.
Global Quality Assurance Committee(Central secretariat: ULVAC, Inc.)

Product Safety Activities

Group-wide implementation of the quality policy
Companies
in JapanCompaniesin South
Korea

Companies
in Taiwan

Companies
in China

CompaniesinSoutheast
Asia

Companiesin Europeand North
America

Individual companies’ quality policies and target deployment activities in accordance with the Group’s policy
Sharing of case studies and horizontal deployment of achievements and effective approaches

Quality management is promoted by way ofthorough analysis of nonconformities that occurred
at a process within the process, implementation ofrecurrence prevention measures, feedback of findings,
implementation of preventive measures, and process
standardization activities.
In FY 2021, in order to strengthen coordinationof quality activities across the ULVAC Group, we
conducted a comprehensive review of quality
documentation to date and revised approximately 40%of the entire documentation and established a new
documentation system to enable quality management
at the business unit level across the Group. This will
facilitate shared understanding throughout the Group toachieve better comprehensive quality management.
ULVAC Group total quality management
Front Loading

Customers

Total Quality Management (TQM) System

Services

Feedback

Quality Assurance

Number of qualified safety assessors

The ULVAC Group has established the Basic
Procurement Policy. We observe the policy and arepromoting CSR procurement in cooperation with ourbusiness partners. Furthermore, “Requests to Our
Business Partners” states our requests to business
partners in areas such as the environment, humanrights, labor and compliance as well as compliance with
the RBA*1 Code of Conduct. With regard to promoting
CSR procurement, we conducted a questionnaire
survey with reference to the RBA Code of Conduct
in FY 2021 covering 520 suppliers for registration as
new business partners and renewals. As a result, we
confirmed that there were no incidences of child labor,
forced labor, inhumane treatment, fraud or bribery,
which are particularly emphasized in the RBA Code of
Conduct, and the handling of conflict minerals. We plan
to expand the scope of this CSR questionnaire survey
to cover ULVAC Group companies in Japan in FY 2023
and overseas Group companies in FY 2025.
Furthermore, we revised the basic transaction
agreement in April 2020 and explicitly mentioned
understanding the content of “Requests to Our Business
Partners” and its observance. In FY 2021, we completed
renewals of the agreements with business partners
accounting for 97% of the value of procurement.

Promoting CSR
procurement
Promotinggreen
procurement(Persons)
70

Promotingglobalprocurement

60
50

Basic
Procurement
PolicySound, good
relationships
with business
partners andaffiliates

Compliancewith laws andregulations

Maintaining
and promoting
fair and freecompetition

40

Purchasing Code of Conduct

30

For details

Website >> Sustainability >Procurement

Purchasing Code of Conduct

10
Installation

Logistics

Inspection

Assembly

Purchasing

Parts
manufacturing

Concept design
Mass-production
designSales

Product
development

To deliver safe and secure ULVAC brand products tomarkets around the world, qualified safety assessors*3
play a leading role in product safety assessments andcontinuously engage in activities to verify the required
safety and quality at the drawing release and productshipment phases. In line with expansion of productionin East Asia, in order to establish an independent
verification system at overseas production bases, weare promoting not only periodic information exchange
but also group-based education in each area andexchanges of personnel. Non-Japanese quality safetyassessors at overseas sites have started to play activeroles. ULVAC is promoting product safety activities
throughout the Group, which will lead to greater
customer satisfaction.

Procurement Policy

20

Value Chain
Detailed
designProcessdevelopment*1

In order to ensure that all ULVAC Group employees
have basic knowledge of quality, educational materials
on quality management for new employees and for
employees engaged in engineering, design, and quality
assurance are registered on the ULVAC Academy
Portal*2 so that they can be accessed remotely. In FY
2021, as part of efforts to raise the quality awarenessof each employee through visualization and sharing ofobjectives and activities across the ULVAC Group, we
published internal newsletters to widely disseminate
the activities of each Group company, provided support
for quality-related education, and held briefings.

02007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 (FY)*1 “Front Loading” ordinarily refers to arranging or planning so that a large
portion of work occurs in the initial phase. At ULVAC, it is an activity to create
quality by identifying issues as soon as possible.
*2 ULVAC’s e-learning system. See P.57 for details.
*3 S afety Assessor (SA) Qualification is a qualification scheme based on thirdparty certification of machine safety knowledge and competence underinternational safety standards.

We established the Purchasing Code of Conduct, a setof principles emphasizing compliance for employees
engaged in procurement, in 2019 with the aim ofmaintaining sound, good relationships with business
partners. In-house education such as case studies on the
Act against Delay in Payment of Subcontract Proceeds,
Etc. to Subcontractors is provided twice a year for

employees engaged in ULVAC, Inc.’s procurement andthat of Group companies in Japan.

Communication with Business Partners
We had been holding operations briefing meetings oncea year as a forum for our president to directly explain
to business partners matters such as the businessenvironment and ULVAC’s business results and suppliermeetings three times a year for the person in chargeof procurement to communicate production plans in atimely manner. In FY 2020, we cancelled these meetingsin view of the COVID-19 pandemic, but launched andstarted operating a membership-based website. While
we strive to provide information in a timely manner,
we will continue to examine ways to improve suppliercommunication with a view to the post-COVID-19 era.

Responsible Minerals Procurement
Conflict minerals are minerals, such as 3TGs*2 andcobalt, that are sourced from conflict-affected andhigh-risk areas (CAHRAs) and whose extraction andsale directly or indirectly serve as sources of funding
for armed groups or are root causes of serious humanrights abuses and poor working conditions. ULVAC, Inc.
does not purchase 3TGs, cobalt, or other raw materials
that are derived from these conflict minerals.
In particular, we manufacture and sell sputteringtarget materials and various tantalum wrought productsin the materials business. We conduct due diligencein accordance with the guidance of OECD and RMI*3
through conflict minerals surveys covering raw materials
suppliers in order to ensure transparency of transactions.
In FY 2021, no procured items that use 3TGs or cobalt
derived from conflict minerals were detected.

Green Procurement Initiatives
We revised the Green Procurement Standards inAugust 2020 and request suppliers to share information
on chemical substances in commercial components
used for products through the chemSHERPA*4. In
FY 2021, we conducted activities with a focus on
creating an internal structure, implementing systems,
and penetration of the Green Procurement Standards
among business partners. We will set specific targets
for FY 2022 and promote initiatives in cooperation withour business partners.

*1 Responsible Business Alliance. CSR promotion group focused on the electronics industry in global supply chains*2 Tantalum, tin, tungsten, and gold
*3 Responsible Minerals Initiative. An organization that inspects smelters and refiners handling 3TGs to certify that they are not using conflict minerals*4 Scheme for enabling sharing of information on chemical substances contained in products throughout the supply chain

61

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62

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

Environment
Environmental Activities in FY 2021

In August 2021, the ULVAC Group revised its Environmental Philosophy, Environmental Policy, andEnvironmental Targets in order to further strengthen environmental initiatives.
Environmental Philosophy
The ULVAC Group understands that the conservation of the global environment is one of the mostimportant issues facing humanity. While effectively utilizing resources in all aspects of our operations, wetake into consideration biodiversity so as to contribute to bringing about a better living environment and amore prosperous society.
Environmental Policy• Reducing greenhouse gas emissions
We reduce greenhouse gas emissions, a main cause of climate change, through all of our activities.
We are committed to developing products that conserve energy and reduce our environmental footprint.
• Preventing environmental contamination
In conducting business, we comply with environmental laws and regulations.
We manage hazardous chemical substances appropriately in our manufacturing processes to prevent
environmental contamination and health hazards.
• Environmental targets and continuous improvement
We establish environmental targets and strive to improve our environmental performance by reviewing
these targets.
In addition, we continuously improve our environmental management system through routine review.
• Environmental education and information disclosure
Through environmental education, we raise the awareness of each individual and appropriately disclose
environmental information.

40% as compared with 2020
• Achieve net zero greenhouse gas emissions by
2050

93,781t-CO2

168,152 thousand kWh
217 t
704 t
1,346 thousand m3

11 kL
Heavy oil:
Kerosene oil: 12 kL
Diesel oil: 149 kL

Reducegreenhousegas emissions

Water
consumption

byPackagingmaterials



40%

56,269t-CO2

In FY 2021, as a Group-wide risk management initiative,
we classified sites with high environmental impacts,
such as those with wastewater treatment facilities orthat handle chemical substances, as high-risk sites, andconducted audits from a comprehensive perspective

Electricity
consumption

OUTPUT

Fuel
consumption

Eliminate environmental accidents

2020

INPUT

LPG:
LNG:
City gas:

Greenhouse gas emission reduction targets

2030

wastewater treatment at companies that use large
amounts of water, such as those engaged in thedeposition and coating business.
The amount of solar power generated increased asa result of the installation of solar power generationequipment by ULCOAT TAIWAN, Inc. in FY 2019. To
reduce greenhouse gas emissions, while continuingenergy-saving activities, we will actively consider
introduction of renewable energy facilities and purchaseof non-fossil certificates. We will continue to promote
environmental activities throughout the Group.

Material balance (Source: Aggregate data for FY 2021)

Gas
consumption

Environmental Targets• Reduce greenhouse gas emissions in 2030 byRegarding the material balance, owing to vitalization of
the market environment and other factors, the amountof activity increased, especially in regions where
major manufacturing sites are located, and electricity
consumption increased except in certain regions suchas Southeast Asia.
Total waste emissions increased in line with theincrease in the amount of activity but the final landfill
disposal rate was virtually unchanged comparedwith the previous fiscal year. We aim to reduce ourenvironmental impacts by reducing waste emissions
and promoting recycling.
The Group’s overall water consumption decreased
as a result of efforts to save water and improve

92,052 t

CO2 emissions(Emissions due to consumption ofelectricity, gas, and fuels)

6,587 tTotal waste
emissions

Total amount ofwaste recycled: 4,426 t
Amount of landfill 93.9 t

1,435 thousand m3
Final landfill
disposal rate

823 t

1.4 %

Net zerogreenhousegas emissions

2050

(CY)

in the presence of third-party experts. For FY 2022,
we added a new environmental target, namely, to“eliminate environmental accidents.” We will conduct
audits sequentially at our overseas sites to prevent
environmental accidents.

ULVAC Group Environmental Photo Contest

Amount of solar power generated

Energy-derived CO2 emissions(kWh)1,500,000(t-CO2)100,000

1,323,580 1,301,727 1,339,244

1,200,000

80,000900,000

60,000600,000

615,652

583,620

40,000300,000

35,09635,202

34,27935,10536,492

61,557

63,76959,50255,82955,560

2017

2018

2019

2020

2021 (FY)20,000

0

2017

2018

2019

2020

2021 (FY)0Group companies overseas

Group companies in Japan*Figures for FY 2019 onward have been restated to reflect the addition of theamount of solar power generated by ULCOAT TAIWAN, Inc.

*The emission factors use the Emissions Factors 2021 edition published by
the International Energy Agency (IEA).

Water consumption

Waste emissions
Total amount of waste recycled (t)Amount of landfill (t)Amount of valuable materials recycled (t)Final landfill disposal rate (%)

In line with the revision of our Environmental Philosophy and Environmental Policy last year,
we held an environmental photo contest, inviting all Group employees and their families
to submit photos they associate with the keywords of our Environmental Philosophy:“conservation of the global environment,” “effective utilization of resources,” “biodiversity,”“better living environment,” and “prosperous society.” The Gold Award winning photo isused for the Environmental Philosophy poster distributed throughout the Group to inculcate
environmental awareness among employees.

(Thousand m )1,500
3Group companies in Japan

1,200
900

364

409

467

Group companies overseas

451

442

(t)
10,000
7,500
5,000

600
300
0

742
2017

899

929

998

993

2018

2019

2020

2021

2,500

(FY)

0

(%)
6.0

289

3.6

286

3.6

6,584

6,504
1,767
2017

4.5

163

2.6

1,877 4,987
1,173
2018

2019

80

93

4,936

4,426

1.4
1,136

2020

3.0

1.4 1.5
1,189

2021

0.0

(FY)

Environmental Philosophy
Poster63

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64

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Environment“ULVAC Green Products” Certification Program for Environmentally Friendly Products

Initiatives at Plants

In accordance with our goal for 2050, we are promoting various environmental activities such as reforestation
and biotope conservation, aiming to contribute to creation of an environmentally friendly and sustainable society.
In addition, in recent years, there has been a growing trend toward business activities geared to creation ofenvironmentally friendly products. Equipment capable of manufacturing devices in ways that have less impact on the
global environment is preferable provided product performance is not compromised.
We established the Environmentally Friendly Products Subcommittee consisting of business divisions and researchdivisions in FY 2021 and have launched a program to certify products that satisfy our own standards as “ULVAC Green
Products.” We will continue refining the framework for creation of environmentally friendly products.

Analysis of power consumption of large evaporation roll coaters

Evaluation Items
Environmental friendlinesselements

Resource
conservation
and recycling

REDUCE

REUSE
RECYCLE

Climateaction

Other

Items
Reduced parts countSpace-saving, compact, lightweight, and simplified
Selection of environmentally friendly materials
Easy-to-assemble, easy-to-disassemble structure
Reduced maintenance frequency
Reduced packaging materials
Reduced consumption of water resources, suchas industrial water
Longer service life
Active use of reused and recycled items
Design for recycling
No use of hazardous chemicals

Reductionof electricity
Reduced electricity consumption
consumption
Reduced consumption of cooling water, nitrogen,
Reducedetc.
consumption ofenergy other than Use of alternatives to greenhouse gases used inelectricity
the process and reduced use of greenhouse gases
Reduced noise

We are stepping up our efforts to reduce greenhouse gas emissions andworking to reduce not only ULVAC’s but also our customers’ power consumption
through the use of ULVAC equipment.
In particular, since large evaporation roll coaters use a lot of electricity, using
energy efficiently is a priority. By installing measuring instruments, detailed
power consumption of each process is determined in order to maximize overall
efficiency of energy use.
Going forward, we will analyze the trend of power consumption of eachprocess by comparing the collected data with the log data of the equipmentwith a view to further improving the equipment.

Large evaporation roll coater

Change of the temperature setting of the cold/hot water heat source
equipment to save energy
The cold/hot water heat source equipment at ULVAC’s Fuji Susono Plant isa source of cold water for cooling manufacturing equipment as well as cold
water and hot water used by the clean room’s air-conditioning systems.
From the viewpoint of reducing greenhouse gas emissions, temperature
settings for cold water and hot water were adjusted corresponding to thecycle of the seasons. As a result, the Fuji Susono Plant reduced its annual
greenhouse gas emissions by 47.65 tons.
The Fuji Susono Plant will continue endeavoring to further reducegreenhouse gas emissions within the range of temperature control values for
production activities and the clean room.

Cold/hot water heat source equipment“ULVAC Green Products” Certification Process
Development/design
divisions

Business
divisions

Development/design

Application forcommercialization

Green Products
Certification
Committee

Participation in the Reforestation Partner System
Green
Products

Review

In Kanagawa Prefecture, where ULVAC Head Office/Plant is located, forests cover
39% of the prefecture’s land area, a very low figure compared to the national averageof 66%. Stewardship activities are being undertaken so as to bequeath flourishingforests, which serve as water sources, to the next generation. In support of thisinitiative, we have joined the “Reforestation Partner” system promoted by Kanagawa
Prefecture. In June 2022, we conducted the first reforestation activity in the 21stCentury Forest in Minami-Ashigara City. 53 ULVAC employees, including those fromGroup companies, and their families participated in the event. In addition to thinningthe underbrush, they tried their hand at woodcraft using the wood derived fromthinning.
The amount of CO2 absorbed through forest stewardship under this program is
calculated to be 247 tons over five years.
We will continue engaging in various environmental activities to realize our goal for
2050, which is to contribute to creation of an environmentally friendly and sustainable
society.

Pass
Environmentally friendly design standards

Exampleof Green
Products

Multi-chamber Sputtering System
ENTRONTM-EX W300

Relevant
items

Reduced parts countSpace-saving, compact,
lightweight, and simplified

In addition to equipment performance and cost competitiveness, environmental friendlinessis also an important value criterion, especially in the semiconductor industry. To meet theseneeds, for the ENTRONTM-EX W300 multi-chamber sputtering system, ULVAC reconfigured
the main body of the system and surrounding control racks to achieve a smaller footprint (areaof the system) and reduce the number of cables used.
The smaller footprint corresponds to the environmental friendliness element of “spacesaving, compact, lightweight, and simplified.” A 40% reduction in the space required for the
racks was achieved by reducing the number of racks through the use of common parts andreduction of the sizes of parts mounted on multiple racks. At the same time, as a result of areview and reconfiguration of the power supply system, the number of cables was reduced
by 40%. This corresponds to the environmental friendliness element of “reduced parts
count.” These improvements will lead to resource saving, reduced CO2 emissions during
manufacturing, and reduced assembly man-hours.
65

ULVAC VALUE REPORT 2022

Certification of the calculated amount of
CO2 absorbed by forests

ENTRONTM-EX W300

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66

Strengthening of Foundation for Value Creation

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Environment

Initiatives to Address Climate Change

Major risks

Under the Environmental Policy, we offer products that enable our customers to contribute to environmental
protection. Initiatives of the ULVAC Group are described below.

Addressing Climate Change
In the context of the growing international awareness ofclimate change, as evidenced by the widespread pursuitof SDGs and the adoption of the Paris Agreement,
efforts to address climate change have become one of
ULVAC’s key management issues. In order to actively
engage with this issue as a responsible member ofsociety, the ULVAC Group has set medium- to longterm greenhouse gas emission targets for its businessactivities, namely, a 40% reduction in 2030 (comparedwith 2020) and effectively zero in 2050. We will takeaction to mitigate climate change by endeavoring
to curb greenhouse gas emissions throughout ouractivities, such as by doing our utmost to conserve
energy in Japan and overseas, introducing renewableenergy with low greenhouse gas emissions, anddeveloping environmentally friendly products.

Category

Elements

MarketIncrease in business costs due to changes incustomer behavior

Measures

Policies and legal
regulations

Carbon pricing

Engineering

Replacement of existing products and services
with those with lower emissions

Research and development of products and services such as
manufacturing equipment that contributes to technological innovation invarious fields, and promotion of low-power consumption of products

Acute/chronic

Business continuity risk due to extreme weather
events such as typhoons and torrential rain

Formulation of business continuity plan for natural disasters andimplementation of countermeasures

Introduction of renewable energy and ensuring the implementation ofenergy-saving measures in business activities

Major opportunities
Category
Products andservices

Elements
Heightened expectations for equipment
and technology contributing to low-powerconsumption devices, power devices andlithium-ion batteries, and increased needs for
low-power-consumption products

MeasuresResearch and development of products and services such as
manufacturing equipment that contributes to technological innovation invarious fields, and promotion of low power consumption of products

Initiatives for the Task Force on Climate-related Financial Disclosures (TCFD) Recommendations
In June 2022, we expressed our support for therecommendations of the Task Force on Climate-related
Financial Disclosures (TCFD). We will continue to enrichdisclosure in line with the TCFD recommendations andpromote dialogue with stakeholders. In addition, we
will clarify the impact of climate change-related issues
on our operations and implement measures to ensuresustainable growth of our business.

Risk Management

ULVAC has been responding to a survey conductedby CDP*, an international NGO, since FY 2020.

*CDP: A non-governmental organization (NGO) managed by a British charity. CDP sends questionnaires on climate change and other issues to companies and local
governments and assesses and discloses the impact of their activities on the environment. When deciding which companies to invest in, CDP scores are
considered important criteria.

Governance
Under the supervision of the Board of Directors, theExecutive Officers in charge of sustainability andenvironment monitor progress toward targets.
Meetings of the Sustainability Promotion Committee
attended by the internal directors are held twice
each year to acknowledge social trends and theCompany’s current condition, and discuss measures
to address any issues. If significant issues related to
management arise, the Board of Executive Officers
and the Board of Directors deliberate and makemanagement decisions as needed.

 eetings of the Global Environmental Management
M
Committee chaired by the Executive Officer in chargeof the environment and attended by environmental
managers of Group companies are held twice eachyear. The committee monitors the setting of targetsof each Group company and the progress, checks thestatus of the initiatives for achievement of the targets,
discusses measures corresponding to the issues, andreports to the Board of Executive Officers.

Strategy
Under the scenarios announced by the Intergovernmental
Panel on Climate Change (IPCC), the International Energy
Agency (IEA), and others, that “the global averagetemperature will rise by 4°C or more” and “the global
average temperature rise will be kept below 2°C (partly up
to 1.5°C) as agreed by the Paris Agreement,” we identified
business risks and opportunities in the medium to longterm that will be brought about by climate change. Of
these, in FY 2021, we analyzed risks and opportunities

67

ULVAC VALUE REPORT 2022with respect to “carbon pricing,” “business continuity risk
due to the occurrence of disasters caused by typhoons,
torrential rain, and other extreme weather events,” and“expansion of market opportunities for power devices”
and evaluated quantitative impacts on our business.
Going forward, we will expand the scope of quantificationof impacts on business and further consider specificmeasures.

The Risk Management Committee, chaired by thepresident and composed mainly of supervisorydivisions, meets regularly, determines company-wide
basic policies, monitors and improves the state ofmanagement and administration, and applies thesepolicies at the facility and division levels of affiliatedcompanies. Judgment is made at meetings of theBoard of Executive Officers as to which risks may
have significant financial or strategic impacts on thebusiness.
Regarding ULVAC’s strategies for environmental
targets, major action plans, risk management policies,
annual budgets, and deliberation and guidance on
business plans, as well as the implementation ofthese targets and monitoring of performance, theGlobal Environmental Management Committee,
chaired by the Executive Officer in charge of theenvironment, manages and oversees progress.
We have major development and manufacturing
sites in Japan, which account for 64% of the Group’s
total GHG emissions in Scope 1 and 2. In addition,sites in South Korea account for 15% of the Group’s
total GHG emissions in Scope 1 and 2, making thatcountry second only to Japan, and they are key sites
for the Group’s semiconductor business to which
great importance is attached from the viewpoint ofmanagement strategy. Therefore, future introductionof carbon taxes and tightening of emissions trading
regulations in Japan and South Korea would havesignificant impacts on costs. Thus, based on the
ULVAC Group’s GHG emissions in Japan and South
Korea in FY 2020, we estimated and confirmed theamounts of impacts in 2030 under the Announced
Pledges Scenario (APS), which is one of the scenarios
presented in the IEA’s World Energy Outlook 2021
and is a scenario that reflects volunteer countries’
ambitious pledges. Reductions of GHG emissions atthese sites are important for achieving the Group’s
goal of carbon neutrality. Therefore, a committee
headed by the Executive Officer in charge of theenvironment and related divisions will monitor therisk of energy cost increases and continue to assess
this and other risks, for which purpose it will monitor
trends. In addition, we will promote initiatives forfurther energy saving and introduction of renewableenergy.
For Scope 3, environmental impacts in the value
chain are significant upstream in procurement fromsuppliers and downstream in the use of products
by customers. Therefore, mindful of the importanceof providing environmentally friendly products, weare promoting initiatives to reflect environmental
considerations from the development stage onward.
In formulating a business continuity plan, we
assumed the occurrence of disasters caused bytyphoons, torrential rain, and other extreme weather
events, and are implementing measures to ensure
continuing operation of our business.

Indicators and Targets
We revised our environmental targets in FY 2020 tofurther strengthen our initiatives to address climatechange. We will embody our Sustainability Policy, whichstates “ULVAC strives to create economic, social, andenvironmental value by comprehensively utilizing its
vacuum and peripheral technologies,” by supporting
the development of a digital society and a carbonfree society through vacuum equipment and vacuum

application business as well as through our initiatives
aimed at achieving new targets.
Reduce greenhouse gas emissions in 2030 by 40% ascompared with 2020
Achieve net zero greenhouse gas emissions by 2050

ULVAC VALUE REPORT 2022

68

Financial Data/Corporate Information

Introduction

About ULVACULVAC’s Vision

Strengthening of Foundation
for Value Creation

Business Strategy

Financial Data/
Corporate Information

11-year Financial Data
Financial Data

(Unit)FY2011FY2012FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY20212012.62013.62014.62015.62016.62017.62018.62019.62020.62021.62022.6

Key financial results
Net sales*1

Millions ofyen

196,804

163,351

173,878

179,174

192,437

231,831249,271

220,721

185,402

183,011

241,260

Operating profit

Millions ofyen(6,384)

6,115

11,996

11,132

17,86429,46835,351

23,82815,95817,19730,061

Ordinary profit

Millions ofyen(6,497)

6,264

13,384

12,475

18,37329,71636,90725,57518,052

17,96632,200

Profit attributable to owners of parent*2

Millions ofyen(49,984)(3,807)

11,538

8,874

16,69824,46935,904

18,665

10,76914,83020,211

Net assets

Millions ofyen

41,18759,436

72,23884,92878,032

104,917

154,069

157,588

161,093

173,699

196,484

Total assets

Millions ofyen

249,651

243,289

230,791

242,348

219,561

245,306

297,418

282,302282,350

292,761354,304

Cash flows from operating activities

Millions ofyen(8,492)

22,35732,213

21,992

23,70837,81819,086

18,282

18,73825,52033,931

Cash flows from investing activities

Millions ofyen(11,328)(4,506)(3,023)(4,055)(5,593)(13,713)(1,564)(9,448)(4,143)(6,925)(7,432)

Cash flows from financing activities

Millions ofyen

12,616(3,619)(16,881)(14,895)(32,448)(22,580)(10,734)(5,844)

7,455(16,061)(6,445)

Cash and cash equivalents at end of period

Millions ofyen

28,18044,20457,012

61,67044,86247,55554,34855,85977,94883,061

107,106

Net assets per share

Yen

751.00806.381,040.23

1,398.66

1,477.29

2,002.90

2,994.12

3,062.39

3,132.22

3,388.87

3,837.17

Earnings per share

Yen(1,012.94)(87.79)223.18172.73338.37496.35728.68378.78218.54301.12410.37

Shareholders’ equity ratio

%

14.8

22.7

29.2

32.8

33.2

40.2

49.5

53.5

54.6

57.0

53.3

ROE (return on equity)*3

%

—

—

18.8

12.1

21.9

28.5

29.2

12.5

7.1

9.2

11.4

Ordinary profit to total assets ratio*4

%

—

2.5

5.6

5.3

8.0

12.8

13.6

8.8

6.4

6.2

9.1

Times

—

—

9.66

10.91

9.21

10.88

5.82

9.02

14.23

18.70

11.26

Capital expenditureBillions of
yen

12.7

6.8

6.2

6.7

7.0

8.3

12.9

12.9

10.3

10.0

11.0

R&D cost

Billions of
yen

7.1

5.0

5.2

5.6

6.3

6.9

8.3

9.2

8.4

8.4

10.3

Interest-bearing debt

Billions of
yen

120.2

106.1

89.6

82.6

62.7

42.7

35.7

35.6

49.8

39.5

39.5

Key performance indicators

Price-earnings ratio*5

Other indicators

Dividends

Yen

—

—

—

10.0

30.0

50.0

95.0

105.0

80.0

95.0

124.0

Dividend payout ratio

%

—

—

—

5.8

8.9

10.1

13.0

27.7

36.6

31.5

30.2

Number of employees

Persons

6,981

6,579

5,971

5,904

5,886

6,072

6,439

6,424

6,370

6,063

6,235

*1 Net sales do not include consumption taxes.
*2 The Company applies the “Revised Accounting Standard for Business Combinations” (ASBJ Statement No. 21, September 13, 2013) and “profit attributable to owners ofparent” is presented instead of “profit.”*3 ROE (return on equity) figures for FY2011 and FY2012 are not presented because the Company recorded a net loss for these periods.
*4 The Ordinary profit to total assets ratio for FY2011 is not presented because the Company recorded an ordinary loss for FY2011.
*5 Price-earnings ratios for FY2011 and FY2012 are not presented because the Company recorded a net loss for these periods.

69

ULVAC VALUE REPORT 2022

ULVAC VALUE REPORT 2022

70

Financial Data/Corporate Information

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Financial Overview
Forward-looking statements contained in this document are based on the current assumptions and beliefs of the ULVAC Group
in light of the information available to it as of September 29, 2022.

Management’s Recognition, Analysis and Discussion of Financial Position and Operating Results

Financial Position

For the fiscal year ended June 30, 2022 (FY 2021),
net sales amounted to ¥241,260 million, an increaseof 31.8% year on year. Regarding FPD production
equipment, orders received and net sales increased due
to active investment in LCDs for tablets, PCs, and IT
panels for automotive and other applications, as well as
continued investment in OLEDs for smartphones andtablets. Regarding semiconductor and electronic device
production equipment, net sales increased from theprevious fiscal year owing to continued investment inmemory and increased investment in logic, as well as
an increase in orders received for production equipment
for electronic devices, such as power devices andoptical devices, despite the impact of longer delivery
lead times for parts and materials.
Operating profit margin was 12.5%, up 3.1
percentage points, a significant improvement fromthe previous fiscal year. This was mainly attributable
to the results of the enhancement of manufacturing
capabilities, which is an initiative of the mid-term
management plan, and an increase in net sales.
R&D cost totaled ¥10,340 million, an increase of¥1,965 million from the previous fiscal year. The ratioof R&D cost to net sales was 4.3%, a decrease of 0.3
percentage points from the previous fiscal year due toan increase in net sales. Strengthening research anddevelopment capabilities is one of the main initiatives in
the mid-term management plan, and the ULVAC Groupis continuing to emphasize investment with a view tofuture growth.

Total assets at the end of FY 2021 amounted to¥354,304 million, having increased ¥61,543 million
compared with the figure at the previous fiscal yearend. The main factors were an increase of ¥26,496
million in cash and deposits due to an improvementin operating cash flow resulting from strengtheningof cash flow management, which is an initiative under
the Group’s mid-term management plan, an increaseof ¥20,042 million in notes and accounts receivable trade, and contract assets mainly due to an increase inorders received, and an increase of ¥12,282 million ininventories.
Total liabilities amounted to ¥157,820 million, having
increased ¥38,758 million compared with the figure
at the previous fiscal year-end. The main factors were

Regarding objective indicators for evaluating thedegree of achievement of the management policies,
management strategies, and management objectives,
we are implementing the mid-term management plan,“Breakthrough 2022,” which covers three years fromFY 2020 (fiscal year ended June 30, 2021). The basic
policy of this mid-term management plan is twofold:“investment in development for growth (selection
and concentration)” and “profit-oriented management
through structural change.” Under this policy, the ULVACGroup will use net sales, gross profit margin, operating
profit margin, return on equity (ROE), and operating
cash flow as key performance indicators.
We revised quantitative targets for the third year
(FY 2022) of the mid-term management plan in August2022. Quantitative targets after the revision are net
sales of ¥250.0 billion (revised from ¥235.0 billion),gross profit margin of 33% (revised from 35% orabove), operating profit of ¥34.5 billion (revised from
¥38.0 billion), operating profit margin of 13.8% (revised
from 16% or above), ROE of 12% (revised from 13% orabove), and operating cash flow of ¥24.0 billion (revised
from ¥29.0 billion). The Group aims to achieve further
growth from a medium- to long-term perspective byimplementing specific initiatives to attain the targets of
the new mid-term management plan.

Management’s recognition, analysis and discussion of operating results by business segment are as follows.
Vacuum Equipment Business
Segment net sales increased 32.3% year on yearto ¥200,098 million. This was mainly attributable toan increase in orders received for LCD and OLED
equipment for IT panels in FPD production equipment.
In addition, net sales of semiconductor and electronic
device production equipment were above the level ofthe previous fiscal year because of an increase in orders
received for production equipment for memory andfor logic as well as an increase in orders received for
production equipment for electronic devices, such as
power devices and optical devices.
Segment profit margin improved from 10.3% for theprevious fiscal year to 13.6% for the fiscal year underreview. This was mainly attributable to the results ofthe enhancement of manufacturing capabilities in FPD

71

ULVAC VALUE REPORT 2022

production equipment and electronic device production
equipment, which is an initiative of the mid-term
management plan, and an increase in net sales.
Vacuum Application Business
Segment net sales increased 29.7% year on yearto ¥41,162 million. Higher segment net sales were
attributable to an increase in sales of materials resulting
from higher utilization rates at customer plants related
to semiconductors, electronic devices, and FPDs,
as well as an increase in sales related to surface
analyzers and mask blanks for high-definition and highperformance displays.
Segment profit margin improved from 6.8% for theprevious fiscal year to 7.1% for the fiscal year underreview. This was mainly attributable to an increase in net
sales of highly profitable products.

an increase of ¥18,957 million in notes and accounts
payable - trade, and an increase of ¥12,587 million incontract liabilities mainly due to an increase in orders
received.
Net assets amounted to ¥196,484 million, having
increased ¥22,786 million compared with the figure atthe previous fiscal year-end. The main factors were an
increase of ¥14,941 million in retained earnings mainly
due to the recording of profit attributable to ownersof parent and an increase of ¥8,150 million in foreign
currency translation adjustment due to the impact of
the weak yen.
As a result, the shareholders’ equity ratio at the endof FY 2021 was 53.3%.

Cash Flows
Cash and cash equivalents at the end of FY 2021 amounted to ¥107,106 million, having increased ¥24,044 million
compared with the figure at the previous fiscal year-end, partly due to the positive effect of exchange rate change
on cash and cash equivalents amounting to ¥3,991 million, reflecting the weak yen. The status of cash flows fromoperating, investing and financing activities and major contributing factors were as follows.
Cash Flows from Operating Activities
Net cash provided by operating activities amounted to¥33,931 million owing to the recording of profit before
income taxes and depreciation. In addition, whileorders received trended upward, improvement of the
cash conversion cycle (CCC) through strengthening of
cash flow management and other measures with theobjective of improving capital efficiency also contributed
to an increase in cash inflow.
Cash Flows from Investing Activities
Net cash used in investing activities amounted to ¥7,432
million. Factors for cash outflow included purchase ofproperty, plant and equipment and intangible assets,
while factors for cash inflow included proceeds fromsale of shares of subsidiaries and associates. As aresult, free cash flow was ¥26,498 million.
Cash Flows from Financing Activities
Net cash used in financing activities amounted to¥6,445 million. Generated free cash flow was used forthe payment of cash dividends and other payments.

Financial Resources and Liquidity
The ULVAC Group’s funding needs are principally for
R&D investment and capital investment, which will
underpin a new growth strategy, and for working capitalfor business operations. The Group intends to expand
investment for development in the semiconductor
and electronic device fields to strengthen growing
businesses. Such demand for funds is satisfied by cash
flows from operating activities and borrowings fromfinancial institutions. In fund procurement, the Groupendeavors to level the annual amount of repayment
in order to reduce refinancing risk and the repayment
burden.

While the outlook is unclear owing to the global
COVID-19 pandemic, increased geopolitical risks dueto the protracted situation in Ukraine and other factors,
the Group has secured sufficient liquidity in hand inorder to ensure preparedness for contingencies. The
Group has also put in place a system that enables it tosecure additional funds by concluding commitment-line
contracts. Thus, the Group is capable of stable operation
for the time being. The Group will maintain the systemthat ensures timely access to necessary funds so as
to be capable of responding to rapid change in thebusiness environment.
ULVAC VALUE REPORT 2022

72

Financial Data/Corporate Information

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Consolidated Financial Statements
Consolidated Balance Sheets(Millions of yen)

FY2020

FY2021

FY2020

FY2021(As of June 30, 2021)(As of June 30, 2022)(As of June 30, 2021)(As of June 30, 2022)

AssetsLiabilities

Current assets

Current liabilities

Cash and deposits

91,545

118,040

Notes and accounts receivable - trade66,289—Notes and accounts receivable - trade, and contract assets

Notes and accounts payable - trade

36,07355,030

Short-term borrowings

8,508

9,618

—

86,331

Lease liabilities

722

679

Merchandise and finished goods

4,064

4,500

Income taxes payable

2,182

3,813

Work in process

22,78529,090

Advances received

12,659—Raw materials and supplies

10,30915,849Contract liabilities—

25,245

Other

7,858

10,562

Provision for bonuses

3,048

5,918

Allowance for doubtful accounts

(319)

(525)

355

404

202,530

263,847

Provision for product warranties

1,222

1,387

Provision for loss on orders received

1,253

16

Total current assets
Non-current assets
Property, plant and equipment

Provision for bonuses for directors (and other officers)

Other

11,797

14,651

83,82185,821

Total current liabilities

77,819116,762

Accumulated depreciation(55,500)(58,939)

Non-current liabilities

Buildings and structures, net

28,321

26,883Long-term borrowings

30,94329,910Machinery, equipment and vehicles

79,32678,272

Lease liabilities

2,361

2,562

Accumulated depreciation(60,073)(62,537)

Deferred tax liabilities

42

128

Machinery, equipment and vehicles, net

19,253

15,735Retirement benefit liability

6,968

7,400

Tools, furniture and fixtures

14,098

14,682

Provision for share awards for directors (and other officers)

198

272

Accumulated depreciation(12,651)(12,908)

Asset retirement obligations

406

416

1,448

1,774

Other

326

368

Land

8,480

8,360

Total non-current liabilities

41,24341,057

Leased assets

4,516

5,079

Accumulated depreciation(1,549)(1,922)

119,062

157,820

Leased assets, net

2,967

3,157

Construction in progress

5,617

9,087

Total property, plant and equipment

66,08664,995

Share capital

20,873

20,873

Capital surplus

3,912

3,912

137,573

152,514

(343)

(344)

162,015

176,955

Valuation difference on available-for-sale securities

2,174

1,440

Foreign currency translation adjustment

4,132

12,282Remeasurements of defined benefit plans(1,422)(1,700)Total accumulated other comprehensive income

4,884

12,022

6,800

7,508

Buildings and structures

Tools, furniture and fixtures, net

Intangible assets
Leased assets

Total liabilities

Net Assets
Shareholders’ equity

34

27

Software

1,347

1,603

Other

2,115

2,085

Total intangible assets

3,496

3,715

Investment securities

7,360

6,882

Deferred tax assets

6,385

6,990

Other

8,763

9,869

Allowance for doubtful accounts(1,859)(1,995)

Total investments and other assets

20,64921,746

90,23190,457

Total net assets

173,699

196,484

292,761354,304

Total liabilities and net assets

292,761354,304

Investments and other assets

Total non-current assets
Total assets

73(Millions of yen)

ULVAC VALUE REPORT 2022

Retained earnings
Treasury shares
Total shareholders’ equity
Accumulated other comprehensive income

Non-controlling interests

ULVAC VALUE REPORT 2022

74

Financial Data/Corporate Information

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Consolidated Financial Statements

Consolidated Statements of Income(Millions of yen)

FY2020

FY2021

FY2020

FY2021(July 1, 2021-June 30, 2022)(July 1, 2020-June 30, 2021)(July 1, 2021-June 30, 2022)

183,011129,247
53,764

241,260
167,51773,74314,801
21,76636,567
17,197

18,03625,646
43,68230,061

199
650
—
569
1,742
3,160

248
745
571
861
1,312
3,736

498
373
—
1,520
2,391
17,966

410
—
195
994
1,598
32,200

4,998
—
55
5,053

343
797
59
1,199

99
—
378
984
1,460
21,559
4,867
1,218
6,085
15,474644
14,830

—
3,090
—
1,028
4,118
29,280
7,549
290
7,839
21,441
1,231
20,211

Consolidated Statements of Comprehensive Income

75

ULVAC VALUE REPORT 2022

(Millions of yen)

(July 1, 2020-June 30, 2021)

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Selling expenses
General and administrative expenses
Total selling, general and administrative expenses
Operating profit
Non-operating income
Interest income
Dividend income
Foreign exchange gains
Share of profit of entities accounted for using equity method
Other
Total non-operating income
Non-operating expenses
Interest expenses
Foreign exchange losses
Commission for syndicated loans
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of investment securities
Gain on sale of shares of subsidiaries and associates
Gain on sales of non-current assets
Total extraordinary income
Extraordinary losses
Loss on disposal of non-current assets
Impairment losses
Loss on liquidation of subsidiaries and associates
Expenses for COVID-19 measures
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent

ProfitOther comprehensive income
Valuation difference on available-for-sale securities
Foreign currency translation adjustment
Remeasurements of defined benefit plans, net of tax
Share of other comprehensive income of entities
accounted for using equity method
Total other comprehensive income
Comprehensive income
Comprehensive income attributable toComprehensive income attributable to owners of parent
Comprehensive income attributable to non-controlling interests

Consolidated Statements of Cash Flows(Millions of yen)

FY2020

FY2021(July 1, 2020-June 30, 2021)(July 1, 2021-June 30, 2022)

15,474

21,441(3,137)
4,748
58

(738)
8,015
(279)

342

624

2,010
17,483

7,622
29,063

16,467
1,016

27,348
1,714

Cash flows from operating activities
Profit before income taxes
Depreciation
Impairment losses
Loss on disposal of non-current assets
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses
Increase (decrease) in retirement benefit liability
Increase (decrease) in provision for share awards for
directors (and other officers)
Increase (decrease) in provision for product warranties
Increase (decrease) in provision for loss on orders
received
Interest and dividend income
Interest expenses
Loss (gain) on sale of investment securities
Loss (gain) on sale of shares of subsidiaries andassociates
Loss (gain) on sale of non-current assets
Share of loss (profit) of entities accounted for using
equity method
Decrease (increase) in trade receivables
Decrease (increase) in inventories
Increase (decrease) in trade payables
Increase (decrease) in advances received
Increase (decrease) in net contract liabilities
Increase (decrease) in accrued consumption taxes
Other
SubtotalInterest and dividends received
Interest paid
Income taxes paid
Cash flows from operating activities
Cash flows from investing activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Purchase of property, plant and equipment andintangible assets
Proceeds from sale of property, plant and equipment
and intangible assets
Proceeds from sale of investment securities
Proceeds from sale of shares of subsidiaries andassociates
Other
Cash flows from investing activities
Cash flows from financing activities
Net increase (decrease) in short-term borrowings
Proceeds from long-term borrowings
Repayments of long-term borrowings
Repayments of lease liabilities
Dividends paid
Purchase of treasury shares
Dividends paid to non-controlling interests
Other
Cash flows from financing activities
Effect of exchange rate change on cash and cash equivalents
Net increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of period
Increase in cash and cash equivalents resulting frommerger with unconsolidated subsidiaries
Cash and cash equivalents at end of period

21,559
8,386
—
99
(823)
217
(402)

29,280
8,587
3,090
—
203
2,593
(38)

42

75

(508)

67

(70)

(906)

(850)
498
(4,998)

(993)
410
(343)

—

(797)

(55)

(59)

(569)

(861)

2,505
(2,568)
3,215
153
—
65
3,004
28,8991,178(505)(4,052)
25,520(16,971)(11,348)
15,544—
10,788594(850)
38,067
1,573(407)(5,302)33,931(11,033)
5,338(20,656)
18,908(7,147)(7,344)

277

224

5,346

391

—

1,200

295
(6,925)(155)(7,432)

(361)
3,750
(13,689)(825)(3,945)
(1)
(984)
(5)
(16,061)
2,468
5,002
77,948331
5,400(5,685)(741)(4,684)(0)(1,065)—(6,445)
3,991
24,044
83,061

112—

83,061

107,106
ULVAC VALUE REPORT 2022

76

Financial Data/Corporate Information

Introduction

About ULVACULVAC’s Vision

Business Strategy

Strengthening of Foundation
for Value Creation

Financial Data/
Corporate Information

Company Data/Stock Information
Company Profile As of June 30, 2022

Directors, Auditors and Executive Officers

Name

ULVAC, Inc.

TrademarkULVAC

Head office2500 Hagisono, Chigasaki,
Kanagawa Prefecture, Japan

President and Chief
Setsuo Iwashita
Executive Officer
Director and Executive
Mitsuru Motoyoshi
Vice President
Senior Managing
Dr. Choong Ryul Paik
Director
External Director
Hiroyuki Nishi
External Director
Norio Uchida
External Director
Dr. Kozo Ishida
External Director
Yoshimi Nakajima
Auditor
Makoto Ito
AuditorKazuya Saito
External Auditor
Senshu Asada
External Auditor
Isao Utsunomiya
Managing Executive
Tetsuya Shimada
OfficerManaging Executive
Sadao Aoki
Officer

Established

August 23, 1952

Capital¥20,873,042,500

Number of
employees

Non-consolidated 1,361
Consolidated 6,235

Stock Information

As of June 30, 2022

Total number of sharesauthorized������������������������������� 100,000,000
Total number of shares issued� 49,355,938
Total number of shareholders�����������15,152

ULVAC Group Companies

As of September 29, 2022

Senior Executive
Officer
Senior Executive
Officer
Senior Executive
Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer
Executive Officer

Shigemitsu Sato
Tomoyasu Kondo
Takeshi Haginouchi
Yu Jer Tsai
Seigou Kinugawa
Zheng Ming Zeng
Dr. Koukou Suu
Shinji Takahashi
Yasuo Shimizu
Kenji Yamaguchi
Dr. Ju Hoon Shin
Sun-Gil Kim
Junya Kiyota•

ULVAC TECHNO, Ltd.

•ULVAC KIKO, Inc.

•ULVAC EQUIPMENT SALES, Inc.

•ULVAC CRYOGENICS INCORPORATED•ULVAC-PHI, Inc.

•

TIGOLD CORPORATION•ULVAC COATING CORPORATION•NISSIN SEIGYO Co., LTD.

•

FINE SURFACE TECHNOLOGY CO., LTD.

•SHOWA SHINKU CO., LTD.

Europe•Number of Shares Held by Shareholder Type

Major Shareholders
NumberShareholdingof shares
ratio (%)
(Thousands)
6,639
13.45

Shareholder’s name
The Master Trust Bank of Japan, Ltd.
Nippon Life Insurance Company

3,242

6.57

Custody Bank of Japan, Ltd.

3,094

6.27

TAIYO FUND,L.P.
BBH (LUX) FOR FIDELITY FUNDS-GLOBALTECHNOLOGY POOLTAIYO HANEI FUND,L.P.

2,552

5.17

1,853

3.75

1,192

2.42

BNP PARIBAS SECURITIES SERVICES LUXEMBOURG/JASDEC SECURITIES/UCITS ASSETS

1,074

2.18

STATE STREET BANK AND TRUST COMPANY 505227

1,039

2.10

STATE STREET BANK AND TRUST COMPANY 505038

744

1.51

JAPAN SECURITIES FINANCE CO., LTD.

648

1.31

Total
49,355,938 shares•

ULVAC, Inc.

TOPIX

(Index)Treasury Stock
3,891 shares
0.01%

Trading volume(Thousand shares)

50,000

1,200
1,100
1,000

40,000900
800

30,000

700

China

500

20,000400
300

10,000200
100
2013/6

2014/6

2015/6

2016/62017/62018/6

2019/62020/62021/62022/60*The Company’s share price and the TOPIX index indicated by line graphs as of June 30, 2012 are 100.

TSR (Total Shareholder Return)*
Annualized TSR

77

Shareholding
period3 years

ULVAC, Inc.

144.0%

94.8%

715.5%

TOPIX

129.4%

130.3%

302.4%ULVAC VALUE REPORT 2022

5 years

10 years*TSR is the overall yield for shareholders that takes into account both capital gains and dividends.
By referring to the formula prescribed by the Cabinet Office Ordinances, the yield for eachshareholding period at the end of FY 2021 is calculated.
The closing price at the end of FY 2018, at the end of FY 2016, and at the end of FY 2011 is used as
the base stock price at the start of investment for each investment period of 3 years, 5 years, and 10
years, respectively.

TaiwanSoutheast Asia•ULVAC (CHINA) HOLDING CO., LTD.

•ULVAC TAIWAN INC.

•ULVAC SINGAPORE PTE LTD•ULVAC (NINGBO) CO., LTD.

••ULVAC MALAYSIA SDN. BHD.

•ULVAC (SUZHOU) CO., LTD.

 LTRA CLEAN PRECISIONUTECHNOLOGIES CORP.

•ULVAC Orient (Chengdu) Co., Ltd.

ULVAC (THAILAND) LTD.

••ULVAC ORIENT TEST AND MEASUREMENTTECHNOLOGY (CHENGDU) CO., LTD.

600

2012/6ULVAC Technologies, Inc.
Physical Electronics USA, Inc.

Foreign Corporations
22,928,701 shares
46.46%

Share Price* and Trading Volume0•

Foreign Investors
38,310 shares
0.08%

Financial
Institutions
16,611,960 shares
33.66%

Note: Treasury stock (3,891 shares) is excluded from the calculation of shareholding ratios.

North America

ULVAC GmbH

Securities Corporations
1,965,503 shares
3.98%

Domestic Coporations
1,858,955 shares
3.77%
Individuals
and Other
5,948,618 shares
12.05%

As of September 30, 2022•

ULCOAT TAIWAN, Inc.

•ULVAC AUTOMATION TAIWAN Inc.

•ULVAC SOFTWARE CREATIVETECHNOLOGY, Co., Ltd.

•ULVAC Materials Taiwan, Inc.

•ULVAC Automation Technology (Shanghai) Corporation•

ULVAC Tianma Electric (Jingjiang) Co., Ltd.

•ULVAC (Shenyang) Co., Ltd.

South Korea•

ULVAC (Shanghai) Trading Co., Ltd.

•ULVAC KOREA, Ltd.

•ULVAC Materials (Suzhou) Co., Ltd•

Pure Surface Technology, Ltd.

•ULVAC CRYOGENICS (NINGBO) INCORPORATED••ULVAC Research Center SUZHOU Co., Ltd.

ULVAC CRYOGENICS KOREA
INCORPORATED•

Hong Kong ULVAC Co., Ltd.

•ULVAC VACUUM EQUIPMENT (SHANGHAI) CO., LTD.

•ULVAC Coating Technology (HEFEI) Co., Ltd.

ULVAC VALUE REPORT 2022

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