Overview of Medium-termManagement Strategy for FY2018-2020(From the year ending March 31, 2018 to the year ending March 31, 2020)~Transformation for Growth~
May 16, 2017
Akira Takeuchi, President,
Mitsubishi Materials Corporation

1｜May 16, 2017

Contents

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
III. Business Strategy by Segment

2｜May 16, 2017

Contents

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
III. Business Strategy by Segment

3｜May 16, 2017

Review of FY2017 Plan
Management targets
for the final fiscal year◆

Operating profit◆

Ordinary income◆

ROA (ordinary income to total assets)◆

Net D/E ratio

100 billion yen
110 billion yen
6%
1.0 time or lower

Group-wide growth strategy◆◆◆

4｜May 16, 2017

Fortifying the foundation for growth
Strengthening global competitivenessPursuing a recycling-based business model

Planted seeds for growth
to prepare for the future

Review of FY2017 Plan
Business Performance(Consolidated)

Net Sales

1,600.0(¥ billions)

1,517.2
1,440.8

1,414.7
1,287.2

5｜May 16, 2017

1,417.8
1,304.0

Review of FY2017 Plan
Business Performance(Consolidated)
FY2015FY2016FY2017

100

71.8

70.4

59.7

110

81.0

72.4

63.9

6

4.4

3.9

3.5

(times)1.0 or lower

1.0

0.8

0.6

Assumptions

Assumptions for
FY2017 Plan

FY2017
Results

Average TTM (yen/$)

100

108

Average TTM (yen/€)

130

119

Copper price (¢/lb)

300

234

Financial Indicators

Operating profit(¥ billions)

Ordinary income(¥ billions)

ROA(ordinary income to total assets, %)Net D/E ratio

6｜May 16, 2017

Result

FY2017
Targets

Review of FY2017 Plan
Profit Targets Not Met by Final Year of FY2017 Plan
Profit falling short of targets in
FY2017 Plan (ordinary income)
Total -46.1 billion yen

Cement
-14.4 billion yen

Metals-12.4 billion yen

Advanced
Materials & Tools-13.0 billion yen

Others
-6.0 billion yen

7｜May 16, 2017

Accommodate to changes in theexternal environment
External factors-25.3 billion yen
Metal prices:
down 11.6 billion yen
Market conditions, etc.:
down 13.7 billion yen◆As a medium-term management strategy,
review the growth strategy and investment
plan for upcoming three years once a year.
◆Review the long-term management policy
every three years as necessary.

Build a structure focusing on strategy
Internal factors-20.8 billion yen
Sales falling short of target:-18.8 billion yen◆Focus on growth strategy, rather thanfinancial plans, and prioritize theimplementation and checking of thestrategy.
◆Focus on marketing when developing thestrategy.

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
Transformation
for Growth

Overview of
FY2020 Strategy

Financials

III. Business Strategy by Segment
8｜May 16, 2017

Transformation for Growth“Transformations”

Undertake a range ofto achieve
the sustainable development of the Mitsubishi Materials Group

Sharing a soundsense of crisis

Transformation

Transformation of
Corporate Culture(Mind, System, Process)

Three

Clear targets (strategy,
indicators) and passion toachieve the targets
9｜May 16, 2017driving forces

For Implementation of Transformations
Corporate Philosophy

Corporate Philosophy
ValuesCode of Conduct

For People, Society and the Earth
VisionWe will become the leading business group
committed to creating a sustainable world
through materials innovation, with use of ourunique and distinctive technologies, for
People, Society and the Earth.

VisionResources andRecycling

Values・Respect Diversity and Teamwork
・Act with Integrity, Speed and Determination

Sustainable
Development
Processed
Goods・Tireless Efforts to Meet the Needs of ourCustomers and Society
Materials

Global Strategy

Technology andDevelopment Strategy

Marketing Strategy

HR Strategy

10｜May 16, 2017

Code of Conduct
Chapter 1: Respect Human Rights
Chapter 2: Safety First
Chapter 3: Compliance
Chapter 4: Mutual Prosperity
Chapter 5: Environmental Management

For Implementation of Transformations
Transformation of
Corporate Culture

Change thecompany logo.

Established on April 1, 2017

New company logo

Employees are the source of value
creation and competitiveness
The thoughts and actions of theleaders influence the future of thecompany

Leadership Values in
Mitsubishi Materials Group

Personality and spirit as a leader
Ability to envision a business model
Ability to make a vision into reality

11｜May 16, 2017

Aim to increase the recognition
and brand power of the Group in
its global business operation.

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
Transformation for
GrowthOverview of
FY2020 Strategy

Financials

III. Business Strategy by Segment
12｜May 16, 2017

Perception of External Environment (10 years from now)
Segment

Japan

Overseas

Overall◆Super-aged society◆Infrastructure development for disaster prevention
and reduction◆Hollowing out of domestic market due to progressof globalization◆Increasing environmental consciousness (increasein EVs, recycling needs, etc.)◆Super-advanced information society based on AI
and IoT (accelerated speed of change)◆Change in international order◆Increase in protectionism◆Slowdown in the growth of emerging BRICS economies◆Increase in the need for infrastructure development due to growing
population◆Increasing environmental consciousness (increase in EVs,
recycling needs, etc.)◆Super-advanced information society based on AI and IoT(accelerated speed of change)

Cement◆Possibility of a decline in demand◆Possible further reorganization of the industry due
to oversupply◆Growth of demand in emerging countries◆Excessive production capacity in emerging countries◆China’s oversupply, export drive, and prolonged market stagnation◆Strong demand in the US

Metals◆Progress of commoditization◆Possibility of a decline in demand for copper &copper alloy products◆Decline in copper quality in mines, increase in operational costs◆Global lead-free movement

Advanced
Materials &Tools◆Declining tendency in the number of automobiles
manufactured◆Increase in the number of airplanes manufactured,
increasing hard-to-machine materials◆Increase in the number of automobiles manufactured in emerging
countries◆Increase in the number of airplanes manufactured, increasing hardto-machine materials

Electronic
Materials &Components◆Low-cost products from emerging countries andintensifying competition◆Super-advanced information society based on AI
and IoT (accelerated speed of change)◆Growth of demand in emerging countries◆Super-advanced information society based on AI and IoT(accelerated speed of change)

Aluminum◆Possibility of rolled products market shrinkage◆Gradual shrinking of beverage can market due todeclining population◆Growth of rolled products market (for automotive panel, andbevarage cans)◆Growth of heat exchange materials for automobiles◆Growth of beverage can market in Southeast Asia

13｜May 16, 2017

Overview of FY2020 Strategy
Long-term Management Policy

Corporate Philosophy
ValuesCode of Conduct

VisionMedium- to Long-term Goals(the company in the future)◆Leading company in domestic and overseas key
markets◆Achieving high profitability and efficiency◆Achieving growth that exceeds the market growthrateGroup-wide Policy
Resources andRecycling◆Optimization of business portfolio◆Comprehensive efforts to increase businesscompetitiveness◆Creation of new products and businesses

Sustainable
Development
Medium-term Management Strategy
Processed
Goods

Materials

Global Strategy

Technology andDevelopment Strategy

Marketing Strategy

HR Strategy

14｜May 16, 2017

Key Strategies in FY2020 Strategy◆Achieve growth through innovation◆Create value by building a recycling-oriented
society◆Increase the company’s market presence throughinvestment for growth◆Increase efficiency through continuous
improvement

Group-wide Policy: Optimization of Business Portfolio
Process manufacturing(equipment-oriented industry,
commodities)• Cement• Copper smelting• Recycling• Renewable energy

Long

Large

Embedded parts

Aluminum (rolling, processing)

Production tools

Sintering parts

Cemented carbide products

Copper & Copper Alloy
Products (sealing parts)

Copper & Copper Alloy
Products (Luvata*)

Electronic Materials &Components

Product manufacturing
15｜May 16, 2017

Capital expendeture

Aluminum beverage cans

Product life

Copper & Copper Alloy
Products (rolling, extrusion)

Short

Small

* Some products of Luvata

Group-wide Policy: Optimization of Business Portfolio
Direction

Stable growthbusiness

Growthpromotionbusiness

Profitability
restructuringbusiness

16｜May 16, 2017

(Indicator to watch)

CementMetals (smelting)
Recycling
Renewable energy◆Aim to strengthen the business foundation
by increasing and maintaining costcompetitiveness using recycling revenues,
etc. and seek carefully selected
opportunities for large investments

ROA

Metals (Copper &Copper Alloy Products)
Advanced Materials &Tools◆Promote growth by matching customer
and market needs and the Company’s
strength◆Business development in adjacent fields
and global markets

EBITDA growth rate

Electronic Materials &Components
Aluminum◆Work promptly to solve issues anddefine the future direction of growth.
・Make investments in competitive advantages
and support technological development
・Ensure thorough selection and concentration

ROS comparison withcompetitors

Group-wide Policy:
Comprehensive Efforts to Increase Business Competitiveness
Reorganization of the Corporate Div. at Head Office◆Unified implementation of process development and productdevelopment by the Technology Div.
◆Strengthening the function of group-wide strategy
development and business support◆Providing one-stop services to business divisions

Reforming the organization to
support the efforts to increasebusiness competitiveness
Organization after reform (from April 2017)

Organization before reform
Corporate Strategy Dept.

Corporate Strategy Div.

Corporate Marketing & Overseas
Business Development Dept.

Audit & Supervisory Board
Member Assistance Dept.

Board of Directors

Corporate Strategy
Committee

Corporate Marketing & Overseas
Business Development Dept.
Corporate Strategy Div.

Corporate Communications & IR
Dept.

Corporate Culture Innovation
Dept

Corporate Culture Innovation Dept

Legal Dept.

Internal Audit Dept.

Finance & Accounting Dept.

(incl. IR)

General Affairs Dept.

(incl. Corporate
Communications and CSR)

General Affairs Dept.
Audit & Supervisory Board

Corporate Strategy Dept.

Environment & CSR Dept.

Audit &
Supervisory Board

Audit & Supervisory Board
Member Assistance Dept.

Board of Directors

Corporate Strategy
Committee

General Administration Div.

Human Resources Dept.

Internal Audit Dept.

Safety & Health Dept.

Safety & Environment Dept.

Finance & Accounting Dept.

System Strategy Dept.

System Strategy Dept.
Technology Div.
Procurement & Logistics Dept.

Procurement & Logistics Dept.

Production Technology
Management Dept.

Corporate Production Engineering
Dept.

Corporate Production
Engineering Dept.

Corporate Research &Development Dept.

Corporate Research &Development Dept.

Mineral Resources Dept.

Mineral Resources Dept.

* Modify the business department organization in the FY2020 Strategy.
17｜May 16, 2017

Human Resources Dept.

(incl. mine management)

Group-wide Policy:
Comprehensive Efforts to Increase Business CompetitivenessTargets

Production
Technology
Management
Production
Engineering

Improvement
and innovation
Procurement& Logistics

Technology
Div.

Optimal use oftechnology
management
resources

Early response tochange in the worldDifferentiation

SystemStrategy

R&D

New development
MineralResources

Safety &EnvironmentOne-stop
services

Supportthrough

CFP: Cross-Functional
Projects

CFP
Business DivisionMarketing

18｜May 16, 2017

Planning,
Development

Current manufacturing

Procurement,
Logistics

Production,
Manufacturing

Shipment,
Logistics

Sales

Maintenance,
ServiceGroup-wide Policy: Creation of New Products and Business→TrendNextGeneration
VehicleIoT
AI
Thermistors

Cutting tools for
new materials

Sensors

DBA substrate

Industries considered

Chip antennas

Copper-alloy strips forelectronic materials

Electronics

Automobile

EnergyEnvironment

Copper-alloy strips
for terminal materials
Battery cases (aluminum)

Recycling
Recycling

Clean
Energy

Urban
Mines

Recycling
Geothermal power generation
E-Scrap

19｜May 16, 2017

Needs that the Company should meet

Potential new products and businesses

Next-generation vehicle, IoT and AI

Solutions for the shift of automobiles to EVs andthe needs of automatic driving
Heat management materials
Sensors, antenna modules, and etc.

Building a rich, sustainable society

Recycling, renewable energy, businesses related tohydrogen-energy society, and etc.

Global Strategy
Promote growth and strengthen presencein the global market
Expansion ofexisting bases

Develop new
production andsales bases
New customer
and market
development
Strengthening
overseas
marketing

20｜May 16, 2017

◆Expand the cement business in North America◆Improve functions of overseas bases for cemented carbide
products◆Boost sales of copper/copper alloy products using Luvata’s
facilities(¥ billions)
Overseas sales◆Expand sales bases for cemented carbide products

Results for
FY2017

416.0◆Boost sales of cemented carbide products in aerospace andmedical applications sectors (EU/US)

Provisional
Financial
Calculations
for FY2020

535.0
~
606.0

◆Boost sales of aluminum heat-exchanger materials forautomobiles◆(US) Strengthen sales support system◆(India) Strengthen sales support system◆(Other regions) Consider business advancement based onmarket research(excl. gold bullion)

Marketing Strategy
Differentiate the company’s products,
technologies, and services
Development of asolution-based
business model

Carry out project activities with the participation of group companies in order to build a
relationship with target customers as a solution partner

Visualization of value
sought by customers

Shift from proposals for individual components to the style of proposing modules andsystems with embedded components and visualize the value sought by customers

Unified management ofcustomer information

Share information on customer trends and needs used for effective development,
sales, and marketing activities

Development andimprovement ofmarketing humanresources21｜May 16, 2017

Develop and improve human resources using outside consultants and internaland external training

HR Strategy

HRStrategy

Improve the development and retention of human resources
equipped with high strategic skills and practical abilities andstrengthen the Group’s management capacity through theappropriate placement of human resources
Human Resources• Development of next-generation management
executives• Development of human resources for global
operation• Promotion of human resource diversity• Appropriate placement of human resources

System• Appropriate operations and continuous
improvement of HR systems and programs• Effective use of HR systems• System that supports a range of working styles

22｜May 16, 2017

Corporate Culture• Diffusion and practice of the “Leadershipvalues in MMC Group”• Creation of opportunities to improve
communication• Creation of a corporate culture in which
diversity is acceptedTechnology and Development Strategy◆Overall optimization of group development (understand the strengths of the group and present thedirection of development)◆Establish a firm technology base (strengthen existing core technologies, get new technologies ahead)◆Technology and development support for existing business (support for new product / new technology
development, technical support for strengthening business)◆Innovation (creation of new business, etc.)◆Process innovation(stable operation, plant efficiency (cost competitiveness), CO2 countermeasures)

Process Manufacturing(Cement, and Metals(smelting))◆Urban resource recycling No. 1(maximizing waste utilization, increasing E-Scrap recycling volume)◆Reduction of domestic demand, Response to labor shortage(technology transfer, etc.)

Product manufacturing(Metals (Copper/copper alloy
products), Advanced Materials& Tools, Electronic Materials &Components, and Aluminum)

Innovation (New business)◆Response to diversification of customer needs⇒ Differentiated product development (new copper alloy, plating, etc.)◆Shorter product cycle ⇒ Speed up development, utilize external technologies, etc.
◆Globalization, Commoditization⇒Mass production, automation, intellectual property enhancement◆Next-generation vehicles, IoT, AI(solutions of the shift of automobile to EVs and needs of automatic driving), heat
management materials, sensors, antenna modules, etc.)◆Building a rich, sustainable society(recycling, renewable energy, hydrogen-energy, etc.)

23｜May 16, 2017

Key Strategies in FY2020 Strategy (Group-wide)
Mediumto Longterm
Goals◆Leading company in domestic andoverseas key markets◆Achieving high profitability andefficiency◆Achieving growth that exceeds themarket growth rate

Groupwide
Policy◆Optimization of business portfolio◆Comprehensive efforts to increasebusiness competitiveness◆Creation of new products andbusinesses

Key strategies
Achieve growth throughinnovation

Create value by building a
recycling-oriented society◆Become a partner
prioritized by customers◆Reduce waste by
pursuing value chains◆Provide optimal solutions◆Expand the recycling
business by establishing
the Company’s original
business model◆Implement open
innovations

Increase the company’smarket presence throughinvestment for growth

Increase efficiency
through continuous
improvement◆Expand global businessbases by increasing
production, sales, andservice establishments◆Strengthen safety
management system◆Promote local production
for local consumption◆Increase productivity◆Determine andstrengthen coretechnology◆Carry out stable
operation◆Increase energy
efficiency◆Increase productivity andimprove services using IT◆Develop sales skills
comparable tocompetitors

24｜May 16, 2017

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
Transformation for
GrowthOverview of
FY2020 Strategy

Financials

III. Business Strategy by Segment
25｜May 16, 2017

Group-wide: Investment Strategy◆Strengthen the businesses by utilizing operating cash flow and revenue from sale of assets◆If there is any other favorable large investment for growth, however, the Company will positively implement
such an investment as far as keeping Net D/E ratio of 1.0 time or lower

FY2018 – 2020 Cumulative Cash Flow

¥ billions

Cash out

Cash inOperating CF
Investing CF

Investment for growth

150.0

Investment for maintenanceand upgrading

170.0

Subtotal

320.0

Dividend, etc*1

46.0

240.0

Sale of assets

Total

60.0

Investing CF

300.0

Sales of share in SUMCO Corporation(moved forward in the previous period)

Financing CF

26.0

Total

366.0

Acquisition of Luvata (carry-over from FY2017)

-40.0

326.0

280.0

326.0

FY2018 – 2020 Cumulative Investment Plan

Total amount of investment
Maintenance/upgrading

26｜May 16, 2017

8

7

5

%

%

%

%
Commoninvestment*1 Total amounts of dividend payment from MMC and dividend payment to non-controlling interests fromconsolidated subsidiary*2 Excludes the cost of acquiring Luvata (Approx. 40 billion yen) carried forward from the previous period.

4

Environment &Energy33%

Advanced Materials& Tools
21%110.0*2

Aluminum

Metals*2

Growth strategy

Electronic
Materials &Components

Cement22%170.0

280.0*2

Group-wide: Capital Policy

Dividend

FY2017 (Results)

FY2018-2020

60 yen/share

80 yen/share◆While the Company’s performance is changed, its policy is tomaintain stable dividends, and annual dividends during the
FY2018-2020 period will be 80 yen per share (dividend amount in2019).
◆If the consolidated dividend payout ratio is lower than 25%,
however, the Company will temporarily increase the dividend orpurchase treasury stock.
* A consolidation of shares of the Company's common stock at a 10:1 ratio was executed, with an effective
date of October 1, 2016. According to this, dividend per share for FY2017 is calculated on the assumptionthat the consolidation of its shares was conducted at the beginning of the FY2017.
27｜May 16, 2017

Group-wide: Provisional Financial Calculations(¥ billions)

Results for
FY2017

Provisional
Financial
Calculations
for FY2020

Consolidated net sales

1,304.0

1,620.0~1,840.0

IncomeConsolidated net sales
statement(excl. metals costs)

757.1

870.0~910.0

63.9

82.0~100.0

1,896.9

1,950.0

Net interest-bearing debt

386.9

450.0

Shareholders' equity

621.2

640.0

ROA (ordinary income to total assets) (%)

3.5

4.5~5.0

ROE (%)

4.8

7.0~8.0

Net D/E ratio (times)

0.6

0.7

Exchange rate USD (yen/$)108

100~120

Assumptions Exchange rate EUR (yen/€)

119

120

234

250~270

Consolidated ordinary income
Total assets
Balancesheet(*)

Copper price (LME) (¢/lb)* Median used for BS

28｜May 16, 2017

Remarks[Principal reasons of changes, ordinary
income base]Market conditions
12.0
Investment effect15.0
Metal prices
3.0~7.0
Foreign exchange-6.0~8.0
Other
-6.0
Total
18.1~36.1[Sensitivity]◆ Exchange rate 1 yen/$ (yen depreciation)
0.7 billion yen◆Copper price (LME) +10 ¢/lb
2.2 billion yen(Ordinary income)

I.

Review of Previous Medium-termManagement Plan (“FY2017 Plan”)

II. Overview of New Medium-termManagement Strategy (“FY2020 Strategy”)
III. Business Strategy by Segment

29｜May 16, 2017

Cement BusinessMediumto Longterm
Goals◆Become a leading company in terms ofefficiency in the cement industry◆Become a local-area champion inoverseas

Business
Policy◆Become superior in the domestic
market that is contracting as it
matures◆Grow overseas businesses with thesupport of stable cash income fromdomestic businesses

Key strategies
Achieve growth throughinnovation

Create value by building a
recycling-oriented society◆R&D and Innovation◆Expand the environmental
business- Develop technology to reuse
waste for cement- Develop new business in
manufacturing
growth segment- Enhance concrete- Increase the alternativetechnology
thermal energy rate
- Reduce CO2

30｜May 16, 2017

Increase the company’smarket presence throughinvestment for growth

Increase efficiency
through continuous
improvement◆Fortifying the domestic
foundation for competitiveness- Kyushu Plant: increase
global competitiveness- Downstream business:fortifying the sales
foundation in Tokyo
metropolitan area, etc.
◆Expand the US business- Expand the ready-mixed
concrete business- Establish and reinforce
MCC terminals◆Develop new overseas
business bases◆Improve domestic and the
US cement manufacturing
technology- Establish a stable operation
system- Reduce costs- Thoroughly conserve energy- Increase workplacecapability

Cement BusinessPriority measures: Expansion of the US business anddevelopment of new business bases

Cushenbury Plant

Three measures

Expansion of the US business, improvement of vertical value chains

Cement manufacturing and supply(import terminals)

Cementmanufacturing

Increased costcompetitivenessStable operation through renovation, energy cost
reduction, and recycling expansion achieved throughrenovation

Cement supply

Expansion of supply
system

Accommodation to demand for cement-concrete
admixture (LBT* expansion and new SDT* facilities)

Ready-mixed
concrete business

Expansion ofrevenue foundation

Expansion of ready-mixed concrete business area (northand east LA), aggregate quarries development andenhancement* LBT: Long Beach Terminal * SDT: San Diego TerminalLong Beach
import terminal

Southern California
Cement plant
Import terminal

Cement supply and sales

Ready-mixed concrete plant
Aggregate quarries

Ready-mixed concrete and aggregate business
Cushenbury Plant

Long Beach
Terminal

Ready-mixed
concrete plant

Aggregate quarries

Developmentof new bases(Overseas) Consider theBusiness acquisition

Area where a vertical integration
model can be built◆Maximize profit throughout thevalue chains

31｜May 16, 2017

Area with high importdependence◆Increase synergy withplants in Japan

Emerging market◆Upstream business (manufacturing and sales of cement)- More differentiating elements than downstream business (readymixed concrete, etc)

◆Waterfront location- Export is avalable in case of change in supply-demand balanceMetals BusinessMediumto Longterm
Goals◆Increase synergy between new coppermine development and smelting◆Expand the recycling business andincrease its profitability◆Build high rolling-margin profitability

Business
PolicyContribute to a recycling-oriented
society through metals frommanufacturing to recycling

Key strategies
Achieve growth throughinnovation

Create value by building Increase the company’smarket presence througha recycling-oriented
investment for growthsociety

Mining◆Develop new projects

Smelting
Copper &Copper Alloy
Products- Increase sales of terminalmaterials and new alloys- Develop high-performance
plating

32｜May 16, 2017

◆Improve the system of
improving and making
decisions on existing
projects◆Increase process
efficiency◆Increase E-Scrap recycling◆Sell products meetingcustomer needs

Increase efficiency
through continuous
improvement◆Optimize the smelting
business◆Create synergy with Luvata ◆Fortify the manufacturingsystem of rolling business- Make use of synergy effects◆Promote alloy recycling- Establish global sales system◆Expand sealing materials
business◆Strengthen costcompetitiveness of
extrusion businessMetals BusinessPriority measures: Increasing E-Scrap recycling

North
America

EuropeAsia

Establishment of MMMR (MM Metal
Recycling B.V.): increase inreceiving and sampling capacity+17 kt./year (2017-)

MMC's share
15%
MMC's share
12%

Japan
MMC's share
MMC's share
22%
44%
Cargo-handling
location (LA)Global quantity of
E-Scrap generated(MMC's assumption)

700 kt./year
MMC's
capacity
140 kt./year (FY2017)

MMC's share 20%(The sizes of circles represent quantities.)

Capacity of E-Scrap treated(kt./year)
180
150

Benchmark (2015)

Expansion

120
90
60

W/W No.1 Share30

Naoshima Smelter & Refinery

Onahama Smelting & Refining Co., Ltd.

0

Increase in receiving, sampling,
analysis, and treatment capacities(from 2016)

Increase in capacity +3kt./year(from 2018)

2015

33｜May 16, 2017

2016

2017

2018

2019

Metals BusinessPriority measures: Synergy with Luvata

Increased sales and market
share using the sales andmanufacturing facilities of
the Group and Luvata

LuvataMitsubishi Shindoh Co.,Ltd.

◆Increased sales of copper & copper alloy products of the Group using the sales andmanufacturing facilities of Luvata located mostly in North America and Europe◆Boost sales using the Company’s domestic facilities for Luvata’s products➡ Establish global sales and manufacturing systems using Luvata’s facilities➡Optimize product mix and increase market share with the cooperation of Luvata
34｜May 16, 2017

Advanced Materials & Tools BusinessMediumto Longterm
Goals

Become a global player capable ofproviding high value-added products andservice solutions

Business
PolicyWe aspire to become an energetic
company with a “WakuWaku” feelingas well as a trusted genuine partner ofour customers through a relentless
pursuit of “speed” and “innovation”
from our customers’ perspective,
consistently making things happen.

Key strategies
Achieve growth throughinnovation

Create value by building a
recycling-oriented society◆Enhance the power of solution ◆Promote tungsten recycling
by industry oriented teams◆Create key technologies
through the Company’s
original development andopen innovation◆Get closer to the customers
by utilizing IoT and Big Dataand enhance the level ofmanufacturing capability

35｜May 16, 2017

Increase the company’smarket presence throughinvestment for growth◆Promote local production for
local consumption by
reinforcing factories andusing local venders◆Expand sales and technicalcenter networks◆Create synergies with
Mitsubishi Hitachi Tool
Engineering

Increase efficiency
through continuous
improvement◆Reinforce the Key Accountstrategy◆Decrease cost
◆Improve asset efficiency atfactories

Advanced Materials & Tools BusinessPriority measures: Increase capacity to provide solutions
through industry specific teams
Key industries

Aerospace

Automotive

Aerospace industry“Technologicalcapabilities”

Mold&Die

Automotive industry“Organizational
capabilities”
Marketing●Organize an engineering team and respond to customers withwide range●Enhance relationships with machine tool and tool holder
manufacturers

R&D

Micro
grain

×
Nano
grain

Strengths in hard-to-machinematerials and new materials

Prototyping

Medical applications industry

Manufacturing●Establishing a specialized team in the US, retaining personnel
with specialized skills, increasing product line up, and potential
M&A and/or collaboration

Sales
Establishment of Aerospace
Dept.

●Utilize management resources preferentially because of its growing
stage●Accumulate expertise and build close relationships with customers●Participate in new projects from the initial stage and respond promptly to
prototypes

36｜May 16, 2017

MedicalMold industry●Effectively use resources with Mitsubishi Hitachi Tool
Engineering to acquire new customers and gain the largest sharein the global mold industry

Electronic Materials & Components Business & Aluminum BusinessElectronic Materials &Components Business◆Lineup of high-value added products

Mediumto Longterm
Goals

Become a highly profitablebusiness entity that provides
materials (solutions as well as
products) required by growthmarket in timely manner by
responding to changes in thebusiness environment quickly

Business
Policy◆Generate and expand profits by concentrating resources on
growth businesses and products◆Develop and nurture strong new businesses◆New products and sales expansion in the IoT- related market(antenna modules, thermistor sensors, etc.)

Key
Strategies◆New products and sales expansion in the next-generation
vehicle market(insulated substrates with high thermal conductivity, in-vehicle sensors,solar heat-ray shielding, etc.)

Aluminum BusinessMediumto Longterm
Goals

Rolled and processing◆Establish a presence in the
global market for automotive
heat exchanger materials
Can manufacturing◆Gain the No. 1 share of thedomestic aluminum can market
and expand business overseas◆Development overseas business

37｜May 16, 2017

Business
PolicyKey
Strategies◆Pursue business strategies that utilize the strengths of therolling and can manufacturing businesses, respectively◆Implement a selection and concentration strategy in rolling andprocessing businesses (shift to heat exchanger materials)◆Respond to increased production of beverage bottle-cans anddevelop next-generation productsOther Business
Efforts in environment and recycling

Efforts in renewable energy businessPlay a part in the development of a recycling-oriented society bycreating and expanding a recycling business that uses thecharacteristics and functions of the material industry without relying
on landfill disposal, and that is trusted by stakeholders.

Expand the renewable energy business based on the management
resources developed by the Company and provide a stable supply of
low environmental-load energies to contribute to the development ofa sustainable society.

Geothermal energy"E-waste" (used electronics and electrical products)(

Automobile recycling

Hydroelectric

Fly ash treatment( )Recycling process of
refrigerators

Hydroelectric: Moriyoshi
Dam, Akita Pref.

( )Komatagawa No.4
Hydroelectric Power Plant

Mega solar: Fukui
Photovoltaic Power Plant,
Fukui, Fukui Pref.

38｜May 16, 2017

Mega solar( )"E-waste" (usedelectronics andelectrical products)

Automobile recycling) In the exploration stage

Geothermal power:
Yuzawa, Akita Pref.
(Wasabizawa, underconstruction)

Forward-Looking Statements

These future plans and other statements are based on information
available to the Company’s management as of the day for releasing thismaterial.
There are many uncertain or risk factors inherent in plans, and there
might be cases in which actual results materially differ from plans andother statements of this material.

Mitsubishi Materials Corporation

39｜May 16, 2017