Financial Strategy

Message from the Global CFO: Financial Capital Strategy
Enhancing Shareholder Returns through “Reinforcing Earning Power”
Financial Capital Strategy Towards Achieving
the 24MBPIn the 24MBP, Bridgestone will continue to undertake
management focusing on capital cost based on ROIC, ourmost important management indicator. We will strengthen
our business quality by driving improvement across theentire value chain, thereby striving to reinforce our earning
power as “cash in”. Regarding capital allocation as ”cash out”
while prioritizing sustainable growth and corporate value

Naoki Hishinuma
Global CFO
Executive Director, G Financeenhancement through “strategic growth investment”, wewill promote “maintaining an appropriate financial position”

enhancement through “strategic growth investment” toand “enhancing shareholder returns”. Especially forreinforce earning power, focus on value creation, and build

shareholder returns, we aim to continuously increasea sustainable premium brand, while “maintaining andividends per share in accordance with growth in adjusted

appropriate financial position” and “enhancing shareholder

operating profit to meet the expectations of ourreturns” in accordance with the 2030 Long Term Strategicstakeholders.

Aspiration as a roadmap.

Capital Allocation

allocate the strategic resources at the level of approximately

Regarding “strategic growth investment”, we plan to800 B JPY in the 24MBP, approximately 1.5 times that of theBridgestone regards the interests of our shareholders as an21MBP, as well as expand resources mainly in the premium

important management priority, and follows a basic policy

tire business, which has high certainty of return. In termsof strengthening our management base in preparation forof “maintaining an appropriate financial position”, we will

future business developments while working to improve

drive improvements in capital efficiency, aiming for ROE atbusiness results. As for capital allocation, we are

the level of 11% and ROIC at the level of 10% by 2026, while

prioritizing sustainable growth and corporate value

maintaining financial soundness.

● Capital Allocation/ Shareholder Returns

Cumulative CF*
Approx.
1.6 times

Approx.

2,200 B JPY

Strategicresources
Approx.
800 B JPY
Repayment of debt
Approx. 300 B JPY

Shareholderreturns
Approx.
500 B JPY

Ordinary
investments,etc.
21MBP

24MBP

Cash in: Reinforce earning power* Adjusted, such as excluding strategic OPEX, etc.

88Approx.
700 B JPY

Cash out:

24MBP: Approx. 800 B JPY■ Premium tire business: Approx. 500 B JPY■ Solutions business: Approx. 100 B JPY(Approx. 1.5 times that in the 21MBP) ■ IT / Foundations / Diversified products &Exploratory businesses: Approx. 200 B JPY

Approx.

1,400 B JPY

Strategic resources (strategic investments + strategic expenses)

Maintain an appropriate financial position:
While maintaining financial soundness, balance capital efficiency
Capital efficiency /Capital cost

ROE: 2026 11% level
ROIC: 2026 10% level

Maintain & enhancecredit ratings

2023 Moody’s: A2S&P: AEnhance shareholder returns: Increase dividends in a stable andcontinuous manner
Dividend: With target dividend payout ratio of 40%, continuously increase dividend per share
Dividend per share 2024 dividend forecast: MIN 210 JPY
2026 dividend (24MBP): MIN 250 JPY level

Ordinary capital expenditure: 200-300 B JPY/year level throughout the 24MBP period

Enhance strategic resources mainly for the premium tire business with high certainty of return
Enhance shareholder returns by increasing dividends in a stable and continuous mannerFor Enhancing Shareholder Returns

Strategic Shareholdings Policy

Bridgestone’s basic policy is to increase dividends in a stable

Bridgestone defines strategic shareholdings as holdings thatand continuous manner through sustainable enhancement ofcontribute toward increased corporate value of the Company

corporate value, with a target consolidated dividend payout

and are held out of necessity from the Company’s businessratio to be 40%, taking into consideration not only ourstrategy perspective or with the goal of maintaining or

business performance and financial position for the relevant

strengthening relationships with businesses or collaborative

period, but also our mid-term profit forecast, investment

industries. We will not hold strategic shareholdings forplans, and cash flow. Based on this basic policy, the dividend

reasons outside of this definition. We also confirm theforecast for 2024 is an increase of 10 JPY versus 2023 while

appropriateness of our holdings on an annual basis,

the annual dividend is expected to be 210 JPY per share atincluding an assessment of securities for which shares areminimum, increasing to 250 JPY level per share at minimum

held, number of shares held, holding ratios, and otherby 2026. Towards 2030, we aim to gradually raise thefactors. These assessments are then verified by the Board

dividend payout ratio to 50% as a target. Bridgestone willof Directors. Appropriateness of holding is comprehensively

also flexibly consider share buybacks as an option.

determined by operating divisions involved in businessexecution in accordance with the shareholding policy of theMaintaining Financial Soundness

Company, taking into account a quantitative evaluation of
the economic rationale corresponding to the cost of capitalWith an appropriate financial discipline, we are maintaining

and other relevant factors for each individual stock holding.

and ensuring financial soundness, as well as keeping a highShareholdings that are not judged as appropriate based onlevel long-term credit rating.

the results of this verification process are reduced after
establishing a dialogue and gaining the understanding ofthe business partner for the holding in question. As ofAs of December 31, 2023

the end of 2023, the ratio of shares held by strategicLong-term
RatingRating Agency Name
Moody’s Japan K.K. (Moody’s)

A2Standard & Poor’s (S&P)

A

Rating and Investment Information, Inc. (R&I)

AA+

Japan Credit Rating Agency, Ltd. (JCR)

AA+

shareholdings to net assets (consolidated) was 1.5%,
decreasing year by year.

● Strategic Shareholding Status

政策保有株式の保有状況
150(Number of stocks held)

126
120

120

118116

110
91

90

80

77

72

6960

30

02014

2015

2016

2017

2018

201920202021

2022

2023（FY）

164,015

87,34370,31489,447

60,11049,896

Total amount recorded on balance sheet* (M JPY)
259,754

270,895

238,370

248,917* Total of listed and unlisted shares

Bridgestone 3.0 Journey 2024 Integrated Report89