Teijin Group
Medium-Term Management Plan 2024-2025

May 13, 2024
Teijin Limited
Securities Code: TSE Prime 3401

Table of contents
1. Summary of Medium-Term Management Plan 2024-2025

2

2. Today’s message

3

3. Transformation process

4

4. Recovery of fundamental profitability

6

5. Business portfolio transformation(1) Directions of existing businesses

16(2) To be a company that supports the society of the future17(3) Basic strategy for growth investment

18(4) Capital allocation and shareholder returns policy (FY2024-2025)

19(5) Industrial sector strategies20(6) Sustainability-driven growth26

6. Enhancement of management system

28

7. Sustainability initiatives

36

8. Initiatives to improve PBR

39

1. Summary of Medium-Term Management Plan 2024-2025◼ In view of our past issues, we will make a fresh start by strengthening our global management system to support
business portfolio (PF) transformation. The Medium-Term Management Plan 2024-2025 is the first step

Retrospective review

Medium-Term Management Plan 2024-2025

Stakeholders’ expectations unmet due to underachievement⇒Structural reforms did not lead to major new businesses⇒Reforms of underperforming businesses did not fully
address company-wide problems“Swiftly accomplish business PF transformation
as a first step toward growth”⚫ Inadequate management of business portfolio⚫ Underdeveloped global management system

Initiatives⚫ Weakened manufacturing operations, lack of specialist skills

None of the financial targets were achieved due to sharp
decline in profitability for Materials business◼ To become a unified corporate group, reconfirm Teijin’s
purpose and set a long-term vision

The "Medium-Term Management Plan 2024-2025” is formulated in
response to these issues◼ Closely examine business PF (execute strategic options
for underperforming/less-focused businesses), reinforce
management system, and execute investments for
growth<Preconditions for Medium-Term Management Plan 2024-2025>◼ Restore fundamental profitability of existing businesses• The numerical targets through FY2025 exclude strategic options for underperforming/less-focused businesses• Upon executing the strategic options, the impact on the Medium-Term Management Plan 2024-2025 will also be disclosed

2

2. Today’s message

Business
portfolio (PF)transformation⚫ Execute strategic options for underperforming and less-focused businesses⚫ Create value-driven business structure in growth industrial sectors (mobility,

infrastructure & industrial, healthcare), etc.

Management
systemStrengthen global management system that underpins business PF transformation,and improve our execution

Profit plan

Accomplish profitability improvement and return to growth trajectory by FY2025

Strengthen ability to generate cash and maintain base investments and stable dividends

Financial strategy

Grow investments and additional shareholder returns through execution of strategic options
and sale of cross-shareholdings
33. Transformation process◼ Under the current Medium-Term Management Plan, aim to achieve adjusted operating income of 50.0 billion yen(after-tax adjusted operating income ROIC 4% or higher, ROE 6% or higher)◼ Under the next medium-term plan, aim for ROE of 10% or higher
Reforms for Profitability
Improvement 2023

Profitability
Improvement Reform
Overview: Largely achieved,
but production needs to bestabilized

Medium-Term Management Plan 2024-2025

Medium-Term Management Plan 2026-2028

Recover fundamental profitability
andAchieve business PF transformation

Achieve growth
based on transformed portfolio(Streamline business PF and invest in growth businesses)

Mobility

Quantitative target and future growth

ROIC2

ROIC2

Adjusted
operatingincome32%
30.0billion yen

ROE4
Adjusted operating income3
D/E ratio5
Dividend payout ratio
Minimum dividend

1 IFRS results for FY2023 are estimates
2 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)
3 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income andexcluding gains/losses arising from extraordinary factors◼ Ability to provide parts and materials that meet industrial needs◼ Lighter, high-performance tires, EV battery boxes, etc.

FY2025 Plan

(next medium-term)

FY20231

Aim for ROE of 10% or higher

≥ 4%
≥ 6%
50.0 bn yen
Approx. 0.930%
30 yenInfrastructure & Industrial◼ Complete major periodic overhauls of aramid and reap full
effects of expansion◼ Establish benefits from new applications (e.g., submarine power
cables)Healthcare◼ Build home healthcare business platform throughout Japan◼ Develop orphan drugs for unmet patient needs

4 ROE = Profit attributable to owners of parent/Average* of equity attributable to owners of parent
5 D/E ratio taking into account the equity credit of the subordinated bonds (Gross) (The Company issued subordinated bonds

with a value of 60.0 billion yen on July 21, 2021)* Average: ([Balance at FY start + Balance at FY end]/2)

4

4. Recovery of fundamental
profitability

4. Recovery of fundamental profitability

Financial targets under Medium-Term Management Plan 2024-2025◼ Improve margin to achieve adjusted operating income of 50.0 billion yen in FY2025
FY2023Results1

Revenue

Profitability

Adjusted operating income2(Billions of yen)

FY2024
Plan

1,033.0
Excluding insurance proceeds3

FY2025Plan

1,050.0

1,150.0

30.0

50.0

2.9%

4.3%

2%

2%

4% or higher-

2%

6% or higher

1.07

1.0

0.9

24.0

[30.0]

Adjusted operating income rate

Excluding insurance proceeds3

2.3%[2.9%]
Capitalefficiency

Financialsoundness

Return on invested capital (ROIC)4
Return on equity (ROE)5

D/E ratio6

1 IFRS results for FY2023 are estimates
2 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income and excluding gains/losses arising fromextraordinary factors
3 Insurance proceeds for the fire accident that occurred at Teijin’s aramid plant in FY2022
4 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)
5 ROE = Profit attributable to owners of parent/Average* of equity attributable to owners of parent
6 D/E ratio taking into account the equity credit of the subordinated bonds (Gross) (The Company issued subordinated bonds with a value of 60.0 billion yen on July 21, 2021)
7 Figures in Japanese GAAP
* Average: ([Balance at FY start + Balance at FY end]/2)

Financial targets for FY2024 and FY2025 do
not include strategic options forunderperforming/less-focused businesses

64. Recovery of fundamental profitability

Overview of profitability improvement and measures for accomplishing reforms◼ Have largely achieved Teijin Group Reforms for Profitability Improvement announced in February 2023, but production yet to stabilize◼ Will work on measures to accomplish reforms under Medium-Term Management Plan 2024-2025
Review of actual achievement in FY2023
Plan

Results(Billions of yen)

13.0 13.0

Composites

6.0
0.5
Recovery from one-off
factors◼ Significantly underachieved due to frequent
breakdowns at aging facilities (production yet
14.0*
to stabilize)
0.5◼ Measures to improve production (e.g.,
automation), sales, and purchasing largely
13.5
achieved as planned◼ Withdrew from China business and completed
Totaltransfer of a subsidiary in Japan

19.0

Measures to improve
profitability* Including the impact of early withdrawal from the China business

Plan

Results(Billions of yen)

Aramid
4.0 4.0
Recovery from one-off
factors

7.0

9.0

Measures to improve
profitability◼ Better-than-planned pricestabilization through forward contract
13.0
for natural gas
11.0◼ Delayed improvement in maintenancesystem impacted production
stabilization, but issues resolved by FY
end
Total

Measures in FY2024-2025◼ Make further improvements including production
stabilization
 Improve labor productivity
 Revise prices
 Fully launch new programs Take whatever steps needed to move into the black in
the United States by the end of FY2024◼ Regain market share through stable supply system
 Stable supply
 Regain market share Promote sustainability measures◼ Continue corporate support in terms of facilities,
operations, and maintenance

Healthcare◼ Achieved licensing of three Ascendis products for rare diseases◼ Achieved about half of the fixed cost reduction target (FY2025: 5.0 billion
yen) ahead of schedule◼ Execute the plan steadily
 Prepare for speedy launch of three products for rarediseases in Japan Achieve fixed cost reduction targets

Fixed cost
reduction◼ Prepared measures to optimize head office staff deployment and scale(fixed cost reduction target for FY2025: 4.0 billion yen)

◼ Fully achieve fixed cost reduction targets, including Next
Career Support Program (Early Retirement Incentive
Program: granted to 150 employees) in Japan
7

4. Recovery of fundamental profitability

Adjusted operating income upon completing Medium-Term Management Plan 2024-2025◼ In FY2024, strong profit growth is expected in Materials, mainly driven by improvement in composites◼ In FY2025, further increase in profit is expected in Materials, mainly due to higher sales volume in aramid■ Increase ■ Decrease ■ Total<Materials>
Composites: (+) Completed profitability improvement, eliminated impact of UAW 2 strikeAramid: (+) Increased volume (stabilized production, eliminated inventory adjustment
effects in supply chain)(−) Strategic pricing to regain share(excluding the impact of strategic options)<Healthcare>(+) Increased sales of OSTABALO/CPAP, reduced fixed costs(−) Revised drug prices, preparation costs for launch of three
products for rare diseases(Billions of yen)

<Others/Elimination or Corporate>(+) Reduced fixed costs including Next
Career Support in Japan

30.0
24.01
<Others/Elimination or Corporate>(+) Reduced fixed costs including
Next Career Support in Japan<Healthcare>(+) Increased sales of OSTABALO, reduced fixed costs(−) Revised drug prices and medical fees, received less license income

1 Adjusted operating income excluding insurance proceeds for the fire accident that occurred at Teijin’s aramid plant in FY2022
2 National Auto Workers Union of America<Materials>
Composite: (+) Increased profit from new profitable programs, additional cost
reduction measures
Aramid: (+) Volume increase (increased sales in existing and new applications)(−) Strategic pricing to regain share
Resins: (+) Volume increase (increased sales in existing and new applications)
Carbon: (+) Volume increase (increased sales in aircraft and industrial applications)

Notes:
Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income and excluding
gains/losses arising from extraordinary factors
IFRS results for FY2023 are estimates84. Recovery of fundamental profitability

Business segment summary: Materials (1/2)◼ While enhancing fundamental profitability based on reforms, boost profit by increasing sales through market growth anddevelopment of new applications
Priority initiatives
1

Reduce costs by enhancing productivity and stabilizing production (aramid, composites)

2

Promptly achieve full operation of new/expanded facilities and full sales (aramid, carbon fiber)

3

Promote development of new applications with growth potential (aramid, resin, carbon fiber)

4

Differentiate from competitors through sustainability initiatives (aramid, resin, carbon fiber, composites)

Adjusted operating income1
Target for FY2025

20.0

Return on invested capital (ROIC)2
billion yen

Target for FY2025

30.0

20.0

(Billions of yen)

20.0

10%
4%

1%

5%

0.0

-20.0

%

15%

6.0

10.0

-10.0

4

-0%
0%

-2.0
-8.0
FY2023

3

FY20234(Reference）

FY2024FY2025-5%FY2023Plan

1 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income andexcluding gains/losses arising from extraordinary factors
2 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)* Average: ([Balance at FY start + Balance at FY end]/2)

3

FY2024FY2025Plan

3 IFRS results for FY2023 are estimates
4 Adjusted operating income excluding insurance proceeds for the fire accident that occurred at Teijin’s aramid plant in FY2022

9

4. Recovery of fundamental profitability

Business segment summary: Materials (2/2)
Factors behind changes in adjusted operating income gain/loss in FY2024-2025
Mobility
Infrastructure & Industrial
Aramid(+)(ー)Resin & Plastic Processing

Carbon Fibers

Composites◼ Increased production volume due to◼ Increased sales in automobile and high-◼ Increased sales in industrial◼ Fully accomplished profitability

stabilized production◼ Increased production/sales volume due toexpanded capacity◼ Increased sales in new applications (e.g.,mooring ropes for offshore wind power
generation)◼ Differentiation through recycled products

speed telecommunications applicationsin China and ASEAN◼ Differentiation through recycled
products

applications, mainly aircraft andpressure vessels◼ Differentiation through recycled
products

improvement measures◼ Launch of highly profitable newprograms and price revisions ofexisting programs◼ Elimination of UAW strike impact◼ Strategic pricing to restore market share◼ Decreased sales volume in office◼ Decreased prices and sales volume◼ Labor cost inflation◼ Labor cost inflationequipment applications due topaperless trend◼ Labor cost inflation

due to intensified competition◼ Labor cost inflation

Examples of new application development
Aramid:Mooring ropes foroffshore wind power
generation

Aramid: Tire belt replacement

Resin & Plastic Processing: EV charging system
10

4. Recovery of fundamental profitability

Business segment summary: Fibers & Products Converting◼ Solidify fundamental profitability by actively expanding into growth areas and promoting environmental initiatives
Priority initiatives
1

Continue to strengthen fundamental profitability and reduce invested capital2

Promote THINK ECO environmental strategy

3

Strengthen sales in expected high-growth mobility and infrastructure markets in industrial materials field

4

Strengthen sales in expected high-growth global apparel market in fiber material and apparel field

Adjusted operating income1

Return on invested capital (ROIC)2

13.0

Target for FY2025
15.0

12.5

billion yen

Target for FY2025
13.0

12.5

(Billions of yen)

10.0

6%

0.0

%

15%
10%

5.0

5

6%
5%

5%

FY2023 3

FY2024FY20250%

FY20233Plan
1 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income andexcluding gains/losses arising from extraordinary factors
2 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)* Average: ([Balance at FY start + Balance at FY end]/2)

3 IFRS results for FY2023 are estimates

FY2024FY2025Plan

11

4. Recovery of fundamental profitability

Business segment summary: Healthcare◼ Continue shifting to a business structure for “rare disease + home healthcare” system
Priority initiatives
1

Early monetization of three Ascendis products for rare diseases (from next medium-term management plan starting FY2026)

2

Maximize profit from existing products

3
4

Reduce fixed costs by 5.0 billion yen† by FY2025 (Restructure organizations/personnel and accelerate shift to “rare disease + home
† Half of target already achieved in FY2023
healthcare” system ahead of schedule)
Search for healthcare products (orphan drugs and home healthcare products) that will lead to early and steady monetization and, in turn,sustainable profitability

Adjusted operating income1
Target for FY2025
20.0

9.0

Return on invested capital (ROIC)2
billion yen

Target for FY2025

18.0(Billions of yen)

15.0
9.0

8.5

0.0

7%
3%

5%

5.0
FY2023 3

FY2024FY20250%

FY20233Plan
1 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income andexcluding gains/losses arising from extraordinary factors
2 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)* Average: ([Balance at FY start + Balance at FY end]/2)

%

15%
10%

10.0

4

3 IFRS results for FY2023 are estimates

4%

FY2024FY2025Plan

12

4. Recovery of fundamental profitability

Business segment summary: IT◼ Continue to pursue growth in e-comics and IT services as key businesses
Priority initiatives
1

Increase e-comics membership through effective use of apps and web advertising2

Expand e-comics content distribution and promote overseas market development

3

Expand IT services for hospitals and promote overseas expansion (mainly in Asia)

Adjusted operating income1
Target for FY2025

Return on invested capital (ROIC)2

11.0

12.0
9.5

billion yen

Target for FY2025
11.0

10.0

(Billions of yen)

%

25%
20%

8.0

14

15%

14%

13%

FY20233

FY2024

14%

10%

4.0

5%
0.0

FY2023 3

FY2024FY20250%Plan
1 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income andexcluding gains/losses arising from extraordinary factors
2 ROIC = Adjusted operating income after tax/Average* of invested capital (Invested capital = Equity + Interest-bearing debt)* Average: ([Balance at FY start + Balance at FY end]/2)

3 IFRS results for FY2023 are estimates

FY2025Plan

13

4. Recovery of fundamental profitability

Business segment summary: Others/New Businesses Development◼ Aim for early business expansion and profitability through strategic resource allocation based on future business potential
Priority initiatives
1

Decide where to allocate resources in view of expected business growth and capital efficiency

2

In battery materials and membranes, develop next-generation products and promote licensing business for in-vehicle
applications with the aim of posting stable profits
In regenerative medicine and implantable medical devices, accumulate track record and experience in CDO business and expand
CMO business

3

Adjusted operating income1

2.0

Target for FY2025

billion yen

2.5

2.0

(Billions of yen)

2.0
1.5
1.0

1.0
0.5

0.5
0.0

FY20232

FY2024FY2025Plan

1 Adjusted operating income was calculated by adding investment gains/losses under the equity method to operating income, excluding

gains/losses arising from extraordinary factors. It does not include the amount of “Elimination or Corporate”
2 IFRS results for FY2023 are estimates14

5. Business portfolio transformation

5. Business portfolio transformation(1) Directions of existing businesses◼ Completed identification of underperforming/less-focused businesses and validation of strategic options
Each of the strategic options are already in their execution phase with respective advisors◼ A series of measures for the strategic options will be announced during FY2024
Existing businesses

Business direction (excluding the impacts of strategic options)AramidGiven expected high market growth rate, secure higher profits by leveraging our top global market share position
Prioritize investment in sustainability to solidify our leading position

Resin & Plastic
Processing

Fierce competition to continue for PC resins due to new and expanded facilities of manufacturers in emerging markets
Aim for high market resilience with products for high value-added/environmentally friendly automobiles and high-speed
telecommunications in China and ASEAN

Carbon Fibers

Focus on development and certification activities to expand adoption of intermediate materials for next-generation aircraft

Composites

Gain/loss has bottomed out. Continue to implement measures to improve profitability
Maximize our top market share position in North America and increase value through the stable launch of new programs

Fibers & Products
Converting

Finish building a fundamental profitability base
Aim to secure stable and market-resilient profit margins by focusing on environmental strategies and high value-added products

Healthcare

Deliver value by combining our unique business platform with pharmaceuticals and medical devices
Pursue alliances, including with orphan drugs and home healthcare products, and restore medium- to long-term growth

IT

Support search for further growth opportunities in online businesses
165. Business portfolio transformation(2) To be a company that supports the society of the future◼ Aim for growth in key industrial sectors to solve social issues◼ Transform into value-driven business in the medium- to long-term◼ Respond to increasingly complex social issues by combining different technologies and functions
Conventional(by material and product)

Grow seeds
in core growth markets• Mobility(CO2 reduction, extension of cruising
distance, digitalization, etc.)• Infrastructure & Industrial(Infrastructure changes due toincreased use of renewable energy;
recycling; sustainability, etc.)• Healthcare(Treatment drugs for rare andintractable diseases, patient
support, etc.)

Business development(value-driven businesses in key industrial sectors)

Functional materials(Thermal management, addressing
extreme environments, etc.)
Processing/solution-based businesses

Our vision
Long-term vision
A company that supports thesociety of the future

Prioritize the health of theplanet,protect the environment, andsupport a circular society(Submarine power cables, recycling, etc.)

Harness home healthcare
service platform

Resolve issues for patients,
families, and communities inneed of greater support17

5. Business portfolio transformation(3) Basic strategy for growth investment
Basic strategy

Examples oftargetmarkets andgrowthareas

Mobility

Infrastructure & Industrial

Healthcare

Expansion driven by

Expansion driven by renewableenergy and sustainability

Expansion in rare/intractabledisease areas

electrification/digitalization
Needs for thermal control to expand, driven byelectrification and digitalization(E.g., automotive thermal
management materials market
to reach 1.2 trillion yen in 2030)

Supplies a wide range of products toautomotive industry and owns industry
channels (OEMs and battery manufacturers)⚫ Delivery track record for EV battery boxes; indepth knowledge of required properties (e.g.,heat/fire resistance)⚫

Competitive
advantages

To build a new competitive business portfolio that capitalizes on growing markets and Teijin’s unique features, wewill allocate our resources primarily to the mobility, infrastructure & industrial, and healthcare fields

Intercontinental transmission demand toincrease due to spread of renewable energy.
Submarine power cables require lightweight,
durable, and corrosion-resistant materials(E.g., 16,700 km of submarine
power cables to be laid in 2040)

Extensive expertise and track record in cableapplications of aramid fibers, the leading highstrength fibers⚫ Technology and know-how cultivated throughrecycling of polyester and aramid fibers⚫

Of approximately 7,000 rare diseases, 95% haveno treatment drugs
Many intractable diseases require long-term
home care and support⚫

Provides pharmaceuticals and medical devices
by capitalizing on our home healthcare service
platform for patients and healthcare
professionals

18

5. Business portfolio transformation(4) Capital allocation and shareholder returns policy (FY2024-2025)◼ Strengthen ability to generate cash by improving profitability and allocate the cash for base investment and dividends on a priority basis◼ As for cash generated from the sale of cross-shareholdings/idle assets and the execution of strategic options for underperforming and less-focusedbusinesses, allocate it on a priority basis for growth investment and additional shareholder returns (including share repurchases)

Shareholder returns

FY2024-2025 total value

Financial soundness

200.0 billion yen• Cash earned by each business• Reduced working capital

30

Approximately% of net income(Minimum dividend: 30 yen per share)

Repay interest-bearing debt
(Improve D/E ratio by approx. 0.1)

Operating cash flow
Base investment

100.0 billion yen• Equipment maintenance and renewal

50.0 billion yen +α• Sell cross-shareholdings• Sell idle assets• Execute strategic options forunderperforming/less-focused businesses
in association with business PFtransformation

Irregular cash
generation

Growth investment

Additional shareholder
returns

Cash inflow

100.0 billion yen +α• Invest in growth businesses andsustainability• Reorganize business portfolio• Share repurchases

Cash outflow
19

5. Business portfolio transformation(5) Industrial sector strategies: Mobility (1/2)◼ Seize growth opportunities in the mobility field and maximize sales of existing products◼ Properly capture changes in future needs, select focus areas, and develop value-driven businesses
Organic growth

Building a new portfolio

 Steadily capture growth opportunities and maximize sales of existing products byleveraging strong market presence and highly competitive product lineup Identify growth directions in the mobility sector where our products meet market
trends and needs, allowing us to capitalize on our technology, sales channels, etc.

Aramid tire cords for luxury cars and EVs

Automobiles (Addressing electrification and digitalization)

Market trends

Business examples

Teijin’s strengths⚫ Vehicles becoming heavier due to electrification ⚫ Cost competitive due to integrated
production from raw materials and⚫ Prevent tire deformation and contribute toproprietary manufacturing methods
improved fuel efficiency andextended cruising range⚫ Functional materials for batteries, ECUs2,
inverters, etc.
(e.g., thermal management)⚫ Resin and filler compounding technology⚫ Industrial channels (OEMs, battery
manufacturers, etc.)

Intermediate materials for aircraft

Aerospace (Addressing fuel-saving and decarbonization efforts)

Teijin’s strengths

8Global share

CAGR + %60%

Market trends

Teijin’s strengths

Business examples

Teijin’s strengths⚫ Increased demand for single-aisle aircraft⚫ Highly productive CFRP manufacturing
technology1⚫ Long track record in supplying aircraftmaterials and reliable development
capabilities⚫ Lightweight and functional
materials for extreme
environments(e.g., heat-resistant materials)⚫ Know-how and track record of certification⚫ Industrial channels (aircraft, engine OEMs,
etc.)

8

CAGR + %Leading positionin next-generation aircraft materials development

1 De-autoclave technology (non-crimp fabric-resin transfer molding [NCF-RTM], thermoplastic carbon fiber composite [CFRTP], etc.)
2 Electronic control unit

(Source: Our estimates based on various data)20

5. Business portfolio transformation(5) Industrial sector strategies: Mobility (2/2)◼ Develop value-driven businesses in automotive and aerospace industries by leveraging our business platform andcapabilities in the mobility field◼ Aim for medium- to long-term expansion into other industries
Total addressable market

Directions for growth Identify directions for growth where our businessplatform and capabilities in the mobility field canbe leveraged
 Develop value-driven businesses in automotive
and aerospace industries
 Aim for medium- to long-term expansion of valuedriven businesses into other industries

Market size (trillion yen)

Global market

Functional materials forautomotive applications

Functional materials for aerospace
applications(thermal management, etc.)(lightweight and resistant to extreme
environments, etc.)

Expansion into
other industries

1.5
1.2

Automotive

CAGR
+13%

Aerospace

CAGR
+8%
1.0

0.65
Maximize sales of existing products (automotive, aerospace*)* Tire cords, exterior parts, battery boxes, intermediate materials for aircraft, etc.
CY2024FY2024FY2030FY2040

CY2030CY2024

CY2030(Source: Our estimates based on various data)21

5. Business portfolio transformation(5) Industrial sector strategies: Infrastructure & Industrial (1/2)◼ Maximize sales of existing products that meet customer needs in terms of environmental contribution and functionality◼ Seize opportunity presented by decarbonization needs in energy sector, and develop solution-oriented businesses involving materials,
processing, and design

Organic growth

Building a new portfolio

 Maximize sales of existing products by capturing growth opportunities with highly
competitive products that meet customer needs for environmental friendliness andfunctionality

 Aim to solve social issues by accurately capturing changing future needs and develop
solution-oriented businesses that involve not only materials but also processing and design

Aramid fibers for optical fiber cable reinforcement

Cable reinforcement solutions (from materials to design/processing)Market trends

Teijin’s strengths

Business examples

Teijin’s strengths⚫ Accelerated development of 5G networks⚫ Growing demand for para-aramid fibers withexcellent dimensional stability⚫ Presence in European and U.S. markets,
global network⚫ Responding to increasing demand forintercontinental power grids andoffshore wind power⚫ Extensive knowledge and experience invarious lightweight and durable cableapplications⚫ Solutions provided for all stages frommaterials to processing

9

Global share

CAGR + %25%

Short fibers for reverse osmosis (RO) membrane supports

Recycling

Market trends

Business examples

Teijin’s strengths⚫ Compliance with various environmental
regulations that are perpetually upgraded toachieve a circular economy*⚫ Technology and know-how cultivated inrecycling of polyester and aramid fibers

Teijin’s strengths⚫ Expanding global demand for RO membranes, ⚫ Superiority achieved through supply
mainly for seawater desalination technology
capacity, product mix, and quality stability⚫ Increasing demand for polyester sheet
materials to ensure strength

9

CAGR + %Global share60%* Separation, chemical recycling technology
development

22

5. Business portfolio transformation(5) Industrial sector strategies: Infrastructure & Industrial (2/2)◼ Expand business in cable reinforcement and recycling areas by leveraging Teijin’s characteristics and capabilities◼ Aim to expand into service businesses in the medium- to long-term
Total addressable market

Directions for growth Identify growth strategies by leveraging our capabilities in existing areas Provide integrated solutions from materials to cable/cord processing technology by applying
extensive knowledge and experience in fiber optic cables and rope/cable applications
 Expand recycling beyond existing businesses into renewable energy-related operations

Market size

Global market

New demand forsubmarine power cableinstallation (km)Recycling (digital services)market)(Billions of yen)

16,7001,550.0
Recycling
Submarine power cable

CAGR
+24%

CAGR
+24%

420.0

650

Maximize sales of existing products*

CY2024* Optical fiber cables, ropes/cables, RO membrane supports, etc.

FY2024FY2030FY2040CY2040CY2024

CY2030(Source: Our estimates based on various data)23

5. Business portfolio transformation(5) Industrial sector strategies: Healthcare (1/2)◼ Deliver value by combining the home healthcare service platform with pharmaceuticals and medical devices to solve issues for patients,
families, and communities in need of greater support◼ Expand overseas in the medium- to long-term

Current stateMedium- to long-term vision

 Intensified competition expected for pharmaceuticals business for lifestyle-related  Business structure providing products/services for rare diseases and home healthcare
diseases Enter overseas markets in the medium/long-term for sustainable business growth Strength in service platform cultivated through home healthcare business⚫ Area: Rare and intractable diseases

Pharmaceuticals
Focus areas

Features and prospects⚫ Area: Lifestyle-related diseases⚫ Growth slowed due to intensifying competition and the(Hyperuricemia, diabetes mellitus,
government’s recommendation to use generics
osteoporosis, etc.)⚫ High market growth rates in rare diseases/new modalities⚫ Technology: Small-moleculedrugs

areas, including in Japan

Orphandrugs
Homehealthcare
Medical devices+ Existing pharmaceuticals⚫ Patient support gaining importance due to diversified
devices (e.g., home self-injection)⚫ Aim: Develop products that can capitalize on ourpatient support service platform, such as thoserequiring self-injection devices⚫ Area: Home healthcare (Medical devices + Existing
pharmaceuticals)⚫ Aim: Expand products that help patientsrecuperate at home and further promote homehealthcare
Patients

Healthcare
ProvidersHome medical devices
Focus areas

Features and prospects⚫ Areas: Respiratory and sleep⚫ Strengths in our business platform as a pioneering patient(Chronic respiratory failure, sleep
support provider in daily home care and disaster relief
apnea syndrome)⚫ As the government continues to promote home
⚫ Technology: Home oxygen
healthcare, target areas are expected to expand due totherapy (HOT)advances in medical technology and means of monitoring

Government

Insurers
Pharmacies

Hospitals andhome-based medical careHome-visit
nursing facilities

Overseas
operations
Acquire newmodalities
and unique
technologies/
products andenter
overseas
markets

Nursing-careprovidersBusiness Platform for Patients/Stakeholders⚫ Provide value by combining products with our service platform forpatients/healthcare providers cultivated in our home healthcare
business24

5. Business portfolio transformation(5) Industrial sector strategies: Healthcare (2/2)◼ Focus on strengthening our earnings base by launching Ascendis products in addition to existing products◼ Strive to expand business overseas in the medium- to long-term

Total addressable market

Directions for growthMarket size (trillion yen)

 In addition to orphan drugs and home healthcare products, aim to
expand overseas by acquiring new modalities/technologies and establish
a distinctive, albeit niche, positioning

Orphan drug market

Global market

Home healthcare device
market

72

6
CAGR
+8%

CAGR
+12%

36

Maximize sales of existing products(Pharmaceuticals, home healthcare devices)

CY20244.5

CY2030CY2024

CY2030(Source: Our estimates based on various data)

FY2024FY2030FY204025

5. Business portfolio transformation(6) Sustainability-driven growth◼ To be “a company that prioritizes the health of the planet, protects the environment, and supports a circular economy,” actively invest in
sustainability and develop environmentally friendly materials and products◼ Launch new businesses that help achieve a sustainable society (e.g., circularity, renewable energy)Core areas and means of developing new businesses Aim to develop circularity-related technologies and services and provide materials for converting, storing, and transporting renewable energy
 In addition to in-house R&D, consider using investment vehicles such as CVC
In-house R&D

Core area

Circularity• Develop new materials and technologies• Reinforce proprietary technologies

Technology development(new materials, recycling technology)

Business partnerships(Utilize investment vehicles, M&A, etc.)• Develop new technology and services• Utilize outside expertise and experience

Multi-material recycling, etc.

Service development (leasing, PaaS1)

Renewable energy

Energy conversion, storage, and transportation(supply materials)

Water electrolysis, next-generation
battery materials, etc.

Sustainability-related business, technology, human resources, etc., developed through existing businesses
R&D of aramid
fibers for tires
made with recycled
raw materials
1 Product as a Service

Mechanicalrecycling of aramid
fibers used inbulletproof vests

Fibers made fromrecycled raw
materials andplant-derived
materials

Mooring ropes forfloating offshore
wind turbines, andsubmarine power
cables: Currently implemented and to be implemented by Teijin

26

6. Enhancement of management
system

6. Enhancement of management system

Roadmap to global management system enhancement◼ Timed with portfolio transformation, enhance global management system and executional capabilities around our purpose
Medium-Term Management Plan 2024-2025

Corrective
actions

Profitability Improvement

FY2023

FY2024FY2025◼ Fostering of sharedvalues◼ Formulate purpose◼ Strengthen upper
management-employee
communication◼ Link strategies, action guidelines,
etc., to purpose◼ Formulation of “My Purpose”◼ Instill purpose within andoutside the company

Optimization ofmanagement
decisions/execution◼ Corporate
governance system
optimized for
global/diversified
companies◼ Reorganize Corporate
Officer Structure◼ Consolidate organization
directly under CEO◼ Further enhance governancestructure◼ Review impacts of systemchanges and improvesystem◼ Establish global
management system

Improvement of
production/
manufacturing
technology◼ Evolve facilities,
operation, andmaintenance by
globally integratingknowledge andtechnology◼ Dispatch engineers inJapan to overseas groupcompanies◼ Standardize equipment
management on a global basis◼ Strengthen on-site execution
through corporate support(mainly aramid/composites)◼ Expand engineeringfunction to other businessdivisions◼ Permanent improvement
cycle

Reinforcement of
human capitalmanagement◼ Assign right people
to right positions to
implement
strategies◼ Start global job posting◼ Maximize internal global talent◼ Formulate HR portfolio◼ Globally integrate job
grade system◼ Globally promote thepolicy to assign rightpeople to right positions◼ Concretize development measures ◼ Shift to optimalin the mobility and infrastructureorganizational structure,& industrial business areas
including integrationof functions◼ Continue to build “rare disease +home healthcare system” in thehealthcare field◼ Set up a businessdevelopment
organization to globallytarget industrial sectors

Goals
Global business
operation alignedwith purpose

Achieve growth strategies in core industrial
sectors

Materials/Products

to FY2027-2028

Industrial Sectors** To consider shift to value offerings such as functionality in the future28

6. Enhancement of management system

Purpose formulation project“Journey to One Teijin” project aimed at clarifying purpose
based on shared values
Background to purpose formulation
 To execute our vision in the current
difficult business environment, it isimperative that our values are sharedacross the organization
 The traditional corporate philosophy
system is complex and difficult tounderstand for diverse employees
worldwide

Redefine what we work for (= purpose) to maximize the power of all
Teijin Group employees CEO spearheads this initiative by sharing messages in his own words, endeavors
to foster a sense of connection and engage all employees worldwide, andexecutes the process in a highly transparent manner Through numerous workshops, over 650 participants are reflecting on Teijin’s
past, getting to know each other, and discussing their aspirations
 Approx. 2,000 employees from around the world gather at town hall meetings to
discuss and consolidate opinions

 Everyone’s aspirations are being consolidated into simple but powerful words

 To be unified under the purpose, weneed to eliminate silos, foster a senseof connection among employees, andevolve into a company needed bysociety29

パーパス

Pioneeringsolutions
together
for a healthyplanet

失敗を責めず、挑戦をリスペクトしよう

ビジョン

未来の社会を地球とあらゆる生命に寄り添い、守る

支える会社

30

6. Enhancement of management system

Teijin Group’s corporate governance system
Corporate Governance
Basic Policy

Improving transparency; ensuring fairness;accelerating decision-making;ensuring the independence of monitoring and supervision

History of governance structures
In 1999
Studied European and U.S.
systems and established
Advisory Board comprised
mainly of overseas advisors toadvise on CEO performance
evaluation and compensation

In 2015
Established Nomination
Advisory Committee andCompensation Advisory
Committee

In 2021• Institutionalized the appointment of
independent outside director to chair Boardof Directors• Revised membership of Nomination Advisory
Committee and Compensation Advisory
Committee to include all independent
outside directors

Monitoring and supervisory function

Board ofDirectors

Internal directors

Board of
Statutory
Auditors

Supervision

Chairperson ofBoard ofDirectors

Chairperson ofCompensation
Advisory
Committee

Internal auditors

Compensation Advisory
Committee

Business execution function

Independent outside directors(Outside: four, Internal: one)
Propose/Recommend

Nomination Advisory
Committee(Outside: four, Internal: one)

Chairperson ofNomination Advisory
Committee

Independent outside
statutory auditors

In 2023
Revised composition of Board of
Directors by increasing
proportion of independent
outside directors to 50%

Advisory Board
Audit

Strategic
advice(Non-Japanese experts: two, Outside: four,Internal: one)

Further reinforcement to be
proposed at shareholders’meeting in June 2024
System that meets required skills
for “Business portfoliotransformation in a global
company”◼ Turnaround◼ Global management◼ Business portfoliotransformation◼ Communication with capital
market31

6. Enhancement of management system

Improvement of production/manufacturing technology◼ Efforts to stabilize production (quality, cost, and delivery) are still halfway. Strengthen corporate support for overseas
group companies and improve production/manufacturing technology for equipment, operation, and maintenance in an
integrated manner
Production and manufacturing technology

Specific measures to enhance maintenance

Equipment (EPC* execution)

Training⚫ Reinforce project execution capabilities

Maintenance⚫ Establishment of a global
structure* EPC: Engineering, procurement, and construction

Focus underMedium-Term
Management
Plan 2024-2025(Corporate support)⚫ Technology maintenance and skills transfer

Engineering department

Operation• Raise awareness of and instill
facility management standards• Audit overseas sites

On-site support

Globally standardize facility management
Assess maintenance level of overseas group companies,
instill facility management philosophy,
and reconstruct systems

Strengthen on-site execution capabilities• Dispatch support staff• Keep track of situations andprovide guidance

Dispatch specialized team from engineering department tosupport management of aging facilities

Global collaboration

Expand support system• Establish and utilize global
collaboration platform

Timely monitoring based on maintenance management
KPIs, and collaborative system engaging the front line32

6. Enhancement of management system

Human capital strategy◼ Formulate HR strategies based on medium-term management plan and purpose/corporate philosophy
Maximize internal global talent◼ Set key action plans based on HR strategy of assigning right people to right positions and measures to empower them
Key Action Plans

Objectives

Human Resources Strategy

Maximize global talent
Assign right people toright positions to
implement strategies(Organizational design, recruitment,
deployment, HR development,
evaluation and treatment)

GlobalEnhance global job posting
Globally integrate job grade system

Optimize HR portfolio

Formulate HR portfolio (core positions, specialists)

In JapanAutonomous careerdevelopment

Implement job-based evaluation and treatment
Talent acquisition strategy
Support employees’ autonomous career development andgrowthMeasures to empowerhuman resources(DE&I and engagement)

Facilitate innovation
Improve employee
engagement

Environment
Diversity: Gender, disability, nationality
Conduct engagement surveys and formulate improvement
action plans33

6. Enhancement of management system

Measures to empower human resources (DE&I, engagement)◼ Create innovation by promoting DE&I and foster inclusive corporate culture conducive to sharing ideas and thoughts◼ Increase corporate competitiveness by enhancing employee engagement◆ Diversity-related KPI targets

External communication• Enhance public recognition of Teijin as
DE&I company• Communication with stakeholders

April
2026
Milestone

Female

12%

20%

30%

NonJapanese

8%

10%

30%

Femaledepartment/
sectionmanagers

10%

12%

20%

Inclusive corporate culture

Diversity & Equity• KPIs for diversity of executive teams
and pipeline of female executives• Leadership and career training for
women• Global job posting• Active roles for employees withdisabilities• Support for LGBTQ+

Category

October
2023
Results

Strategic
measures

Sense ofbelonging• “Journey to One Teijin” project• DE&I in-house newsletter
Together• Global DE&I Day

Executives1

Managers2

April
2030
Target◆ Engagement-related KPI targets
Branding

Globalorganization
systemOrganization and system
for DE&I promotion• Regional DE&I teams• Global DE&I Committee

Details

September
2023
Results

April
20263
Milestone

April
20303
TargetEngagement
score

62

64

68

1 Board members, auditors, and group corporate officers
2 Global data, including Japan
3 Based on survey performed in September concerning the previous

year

34

7. Sustainability initiatives

7. Sustainability initiatives

Major KPIs
◼ Prioritize internal sustainability efforts by degree of impact◼ Continue efforts to achieve targets based on KPIs established for each priority issue◼ Develop new KPIs for capturing business opportunities on a pilot basis, including KPIs related to carbon footprint1, circular
economy2, and health/comfort3
Proportion of sales of carbon footprint-calculated products
1

2 Proportion of recycled and biomass-derived materials by weight
3 Number of people we support in recuperating at home

KPI
KPI aimed at
capturingbusiness
opportunities

Climate change

Our contribution to
CO2 reduction

Climate change

Our CO2 emissions

FY2030Total CO2 emissions <CO2 reduction contribution

CO2 reductions in downstream supply chain due to use
of productAggregate target

FY205030% reduction
Achieve net zero

FY203015% reduction

FY203030% improvement

Freshwater intake volume per sales unit

FY203020% improvement

Landfill waste volume per sales unit

FY203020% improvement

Hazardous chemicals emission volume per sales unit

FY2030Shift to renewable energy and clean energy for heatsources

Climate change

KPIs aimed atstrengthening
businessplatform*

Supply chain CO2emissions
Circular economy

Water
Circular economy

Waste
Safety/Security

Hazardous substances* All KPIs for strengthening the business platform are target values set with FY2018 as the base year

Greenhouse gas emissions in Scope 3 Category 1

36

7. Sustainability initiatives

Roadmap for CO2 emissions reduction◼ Roadmap underway toward net-zero emissions by 2050, although current increase in production is expected totemporarily push up emissions◼ Continue with efforts to transition to renewable energy, which is progressing as planned in Europe and ahead ofschedule in China◼ Fully phase out coal by end of FY2025 in Thailand and Japan. Effects to fully manifest in FY2026 and onward(Million t-CO2)
1.5

Scope 1

Scope 2

Achieve net-zero emissions for the Group

0.75

0
2018

2020 2021 2022

2025

Transition to renewableenergy in Europe

2030

2050

Global transition to renewableenergy beyond China and Japan

Energy efficiency/conservation

Phase out coal-fired thermal power
within Group in Thailand and Japan

Process innovation

Utilize hydrogen, etc.

37

8. Initiatives to improve PBR

8. Initiatives to improve PBR

Measures and targets under Medium-Term Management Plan 2024-2025◼ Based on analysis announced in February 2024, set/disclose PBR improvement measures/targets under Medium-Term
Management Plan 2024-2025◼ Steadily carry out plan for speedy improvement of PBR
Recognized issues (announced in February 2024)
Our challenges
Profitability1

ROE

Asset efficiency2◼ Main factor behind
ROE decline◼ Low impact on ROE
declineMeasures and targets under Medium-Term Management Plan 2024-2025
Target FY2025 ROE of 6% or higher
Aim for ROE of 10% or higher and PBR of 1.0 or higher as early as possible after
Medium-Term Management Plan 2024-2025

Profitability◼ Improve andstabilize profitability◼ Accomplish Reforms for Profitability Improvement◼ Execute strategic options for underperforming/less-focusedbusinesses◼ Invest in focused businesses◼ Improve business operations by strengthening management system◼ Reduce cross-shareholdings and sell idle assets

×PER

1 Net profit to sales
2 Total asset turnover

Financial
position3

Medium- tolong-term
growthexpectation

Asset efficiency◼ Low impact on ROE
decline but
improvement
required◼ Low PER continued◼ Smaller spread
between ROE and1/PER (≈cost ofequity)◼ Consider share repurchases using any resources gained throughasset sale and strategic options

Financial position◼ Ensure a balance between financial discipline and capital efficiency
while utilizing interest-bearing debt

◼ Management strategy
to gain trust for
medium- to long-term
growthMedium- to longterm
growth expectation◼ Earn trust of investors
 Steadily achieve plan Provide detailed explanation of business portfolio transformationand future growth potential
 Stable and continuous shareholder returns◼ Strengthen global
management system

Strengthen global
management system◼ Strengthen management system to achieve long-term vision(Purpose, governance, human capital, technology, etc.)

3 Financial leverage

39

Appendix

Appendix

Dividend policy◼ Dividend policy
 Pay performance-linked dividends with a view to a payout ratio of approximately 30%
 Lower limit of annual dividend per share set at 30 yen in consideration of stable and sustainable payments◼ Share repurchases Give priority to growth investments and additional returns to shareholders (including share repurchases) in allocating any funds gained throughasset sale or execution of strategic options for underperforming and less-focused businesses
100

Dividend per share (yen)

9.1 million shares (equivalent to 20.0 billion yen)repurchased in FY2018
70

50

55
22%

60

46%
60

Net
loss

55%

Share repurchases
also actively
considered

46%
Net
loss

30%

58%

26%
22%
50

35

55
40

30

30

≧30

FY2023

FY2024Plan

FY2025Plan

0
FY2015FY2016FY2017FY2018FY2019Dividend per share

Note: Dividend for FY2018 includes 100th anniversary commemorative dividend of 10 yen/share

FY2020

FY2021

Consolidated payout ratio

FY202241

Appendix

Quantitative plans for each business segment
Materials

Fibers & Products Converting(Billions of yen)

530.0
460.0

440.0

Healthcare(Billions of yen)

321.0

320.0

340.0

12.5

12.5

13.0

FY2023

FY2024FY202520.0(Billions of yen)

145.0

FY2024FY2025Plan
Adjusted operating income

Plan
Adjusted operating income

Revenue

IT

8.5

9.0

FY2023

FY2024FY2025
Plan

Revenue

Adjusted operating income

Revenue

Others(Billions of yen)(Billions of yen)

72.0

75.0

80.0

9.5

10.0

11.0

FY2023

140.0

18.0

6.0
-2.0
FY2023140.0

FY2024FY2025Plan

Adjusted operating income

60.0

55.0

55.0

0.5

1.0

2.0

FY2023

FY2024FY2025
Plan

Revenue

Adjusted operating income

Revenue

Notes:• Adjusted operating income was calculated by adding investment gains/losses underthe equity method to operating income and excluding gains/losses arising fromextraordinary factors• IFRS results for FY2023 are estimates• “Others” does not include the amount of “Elimination or Corporate”

42Appendix

ESG recognition
Selected as a component stock of all five ESG indices used by GPIF

Obtained the highest AAA rating in the MSCI ESG RATINGS

Highly rated in the Nikkei SDGs Management Survey
THE INCLUSION OF TEIJIN LIMITED 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 TEIJIN LIMITED BY MSCI OR ANY OF ITS AFFILIATES
THE MSCI INDEXES ARE THE EXCLUSIVE PROPERTY OF MSCI. MSCI AND THE MSCI INDEX NAMESAND LOGOS ARE TRADEMARKS OR SERVICE MARKS OF MSCI OR ITS AFFILIATES

Inclusion in SRI indices• Rated S or higher in all four categories

Included in these two domestic programs
as a company with outstanding ESG initiatives
Promoting Health Management

Sports Yell Company(Silver*)* Awarded to companies
certified seven to nine
times

43

Cautionary Note on Prospects• The information contained in this document is based on various assumptions and Teijin does not guarantee or warrant the achievement of the future planned
figures and measures described herein• The figures and indicators in this document for the FY2024 and FY2025 forecast are those announced on May 13, 2024
• Information on pharmaceuticals, medical devices, and regenerative medicine products (including those under development) contained in this material is notintended as advertising or medical advice