New Mid-Term Management Plan
“Transformation: BEYOND2030”(FY 2024–FY 2026)

May 13, 2024

Top Message
Sakai Chemical’s image of the future: “An excellent company capable ofcontributing to society with Smart Material”
The Company imagined what life in 2050 would be like, and what chemistry can do tocreate it. For the three fields of environment & energy, electronics, and life sciences &healthcare, the Company aims to transform into "an excellent company capable ofcontributing to society with Smart Material."

The new Mid-Term Management Plan “Transformation: BEYOND2030” isthe transformation stage for the future
The new Mid-Term Plan has been positioned on the transformation stage to realize thetransformation to our desired future. By growing through the dual pillars of inorganic andorganic chemistry and shifting to businesses that contribute to a society looking to the
future, the Company will transform into a highly profitable company.

Complete the transformation for the future with determination(1) Business portfolio restructuring aimed at shifting to high-valueadded products(2) Achieving ROE that exceeds the cost of capital and improving PBR(3) Rebuilding the management foundation via materiality promotion
and accelerating non-financial initiatives
Sakai Chemical Industry Co., Ltd.
These three key areas will be focused on to complete thePresident and Representative Directortransformation for the future with determination.
Toshiyuki Yagura

SAKAI CHEMICAL INDUSTRY CO., LTD.

2

Future Direction of Sakai Chemical (BEYOND2030)
Life of 2050 as envisioned by the Company
Coexistence of Virtual
A Society Based on Human Involvement
and Real Spaces

Interaction and communication between people do not disappear

Furthered Diversification of Lifestyles

Communications via Remote and In-person

Compact cities and interaction with nature

Ways of connecting with people may differ,
but the need for beauty and health always remains

What chemistry can do to create the lifestyle of 2050
Electronics

1 Protect nature(protect the global environment)

Environment/
EnergySupport the development of an
2 advanced information society

HumancapitalCore
technology(for a more equal society)
Life science/
Healthcare

3 Support People’s HealthBecoming “an excellent company capable of contributing
to society with Smart Material” for the three fields
SAKAI CHEMICAL INDUSTRY CO., LTD.

3

Road-Map to the Future (BEYOND2030)
Actively invest management resources in the "seeds" of highly profitablebusinesses that can contribute to the future in the three fields
2 Support the development of an advanced information society (for a more equal society)
1 Protect nature(protect the global
environment)

3 Support People’s

Expansion into 5G and 6G-related
products utilizing the characteristics ofperfectly spherical microparticles

Expansion into electronicmaterial applications
utilizing flexibility

Spherical
silica Sciqas
Contributing tocarbon-neutrality

Water electrolysis
catalyst Ir/ENETIA

High-purity
barium carbonate/barium titanate

Methanation
catalysts
deNOx
catalyst

Electronicmaterials

Catalysts

Highlyrefractive
materials
Thiol products
Active pharmaceuticalingredients/intermediates

Organic
chemicalproducts

HumancapitalCosmetics
materials

Core technology
Organicsynthesis

Corporate
concept

Powderprocessing

Chemistry for a Friendly FutureManagement
Creating materials that support the comfort andmissionsecurity of society through compassion andtechnological innovation

SAKAI CHEMICAL INDUSTRY CO., LTD.

Pharmaceuticalmanufacturing

SunscreenNew
Mid-Term
Plan

HealthCosmetic
products
Microplastic beadalternative products
Barimaru/Calmaru
2030

FutureExciting Company

Organizational
We will build an exciting company
visiontogether4

Positioning for the New Mid-Term Management Plan
“Transformation: BEYOND2030”
Focusing intensively on shifting to high-value-added products as thetransformation stage to the future
Sakai Chemical’s
Image of the Future
Backcasting

Reflection

Current
A chemical makerwith a focus on
inorganic materials
FY 2023

Vision for the new
Mid-Term Plan
Growing through the dual pillars of
inorganic and organic chemistry
and shifting to businesses that
contribute to a society looking to
the future

An excellent company
capable of contributing tosociety with Smart Material➢ ROE: 12% (2030)

FY 2026➢ Operating income:9 billion yen➢ ROE: 8%(Excluding profit growth from M&A)
➢ Operating income:2.9 billion yen➢ ROE: −9%“Transformation: BEYOND2030”

SAKAI CHEMICAL INDUSTRY CO., LTD.

5

Looking Back on Previous Mid-Term Plan Periods (FY 2019 - FY 2023)
Started engagement in business portfolio management amid rapid changes inthe external environment
Initiating business portfolio management➢

Results➢

Classification of each sub-segment for growth, stability, and efficiency considerations,along with the absorption merger of SC Organic Chemical Co., Ltd.
Unprofitable product price correction/discontinuation

Reworking corporate governance➢➢Appointment of external directors with extensive management experience in criticalareas such as GMP management and diversity promotion
Reduction of cross-shareholdings and elimination of parent-subsidiary dual listings bymaking Sakai Trading Co. Ltd. a wholly-owned subsidiary

Promotion of people and environment-friendly manufacturing➢

Development of microplastic bead substitutes and methanation catalysts

Quality/Safety issue recurrence prevention

Issues➢➢Administrative disposition of Kaigen Pharma Co., Ltd. for violation of the PMD Act
Yumoto Factory explosion and Onahama Manufacturing Site fire accidents

Improvement from current poor performance➢➢

Poor performance of growth businesses (impairment related to electronic andcosmetics materials, etc. for FY 2020)
Fundamental measures for underperforming businesses (impairment related totitanium dioxide and inorganic materials for FY 2023)

Improvement of CCC and cash flow and overcoming the stagnation of ROE and PBR
Accelerate achievements and steadily address challenges for the new Mid-Term Plan

SAKAI CHEMICAL INDUSTRY CO., LTD.

6

Complete Quality/Safety Issue Recurrence Prevention
Rebuild quality and safety management system, strengthen group governance

Date ofoccurrence

Cause

Individual
measures

Entirecompany
measures

Kaigen Pharma
Order to suspend business(violation of PMD1 Act)

Yumoto Factory zinc dust plant
Explosion and fire accident

Onahama Manufacturing Site
Titanium dioxide plantfire accident

December 22, 2023

May 11, 2021

March 30, 2023

(administrative disposition)➢ Inadequate management andsupervision system➢ Closed organizational culture(Kaigen Pharma)➢ Accumulation of depositedparticles➢ Damage to rotor➢ Malfunction of special
equipment

Kaigen Pharma:➢ Management structure reform➢ Reorganization of the entire
company structure and systemestablishment➢ Resource management and job
rotation➢ Strengthening education for
executives and employees➢ Establishment of a compliancemanagement system➢ Removal of dust accumulated
during processing➢ Improvement of dust removal
frequency➢ Improvement of similarequipment for defect resolution(Clarification of responsibilities and scope of
duties of directors, internal reporting systempromotion, and fostering a quality culture)

Sakai Chemical:➢ Promotion and supervision of
improvement plans(Increase the number of external directors
dispatched to Kaigen Pharma to two forstrengthened monitoring)(1) Thorough safety awareness:
Thoroughly instilling awareness that "just because somethinghasn't happened yet doesn't mean it's safe"➢ Regular communication of top messages (not letting accidents beforgotten)(2) Safety measures:
Implementation of safety and health activities by everyone frommanagement to site workers➢ Resolution of issues identified in external risk assessments➢ Conducting training to demonstrate more effective risk
management➢ Continuously review safety and health standards*1 PMD Act: Law concerning the assurance of quality, efficacy, and safety of pharmaceuticals and medical devices, etc.

SAKAI CHEMICAL INDUSTRY CO., LTD.

7

Results against Numerical Targets of the Previous Mid-Term Plan
ROE target was achieved in FY 2021, but in the last fiscal year,
neither operating income nor ROE were
FY 2019

FY 2020

FY 2021

FY 2022

FY 2023
Previous Mid-Term
Plan target

80

75
Operatingincome:(billion
yen)

40

44

43

29

8.7%

Previous Mid-Term
Plan target

6%
ROE

3.3%

2.9%
▲3.6%
▲9.2%

Issue of revenue structure not consistently exceeding
the cost of shareholders' equity
SAKAI CHEMICAL INDUSTRY CO., LTD.

8

Initiating Business Portfolio Management (FY 2022 on)
Defining the Portfolio Management Policy
Portfolio Management Policy

Chemical Business

Growthbusinesses

Stablebusinesses

Accelerate the capture of market
needs as a business driving
medium to long-term profit
growthMaintain as a stable revenuegenerating business to the future

Businesses
considered
for efficiency
improvement

Implement fundamental
measures based on the businessstructure and performance levels;
aim to shift towards stable andgrowth businesses

MedicalBusiness

Shift to products not affected bydrug price revisions

Sub-segment

Operating income
FY 2023 results

Reference: previous MidTerm Plan annual averageElectronicmaterials

300
million yen

600
million yen

Cosmetics
materials−100
million yen

300
million yen

Hygienic
products
Organic
chemicalsContract
processing

400
million yen

300
million yen

1.4
billion yen

1.5
billion yen

500
million yen

700
million yen

Titanium dioxideand zinc−400
million yen

100
million yen

Plastic additives

600
million yen

500
million yen

Catalysts

100
million yen

100
million yen

100
million yen

400
million yen

Note: Excluding “Other” from the chemical business

SAKAI CHEMICAL INDUSTRY CO., LTD.

9

Important Initiatives for the New Mid-Term Plan,“Transformation: BEYOND2030”
Business portfolio restructuring aimed at shifting to high-valueadded products
Transformation

01

➢

➢
➢

In addition to electronic and cosmetics materials, improve the profitabilityof growth businesses through investments in organic chemicals, expand
business through M&A, and identify the best owners
Future investments for the next Mid-Term Plan (cosmetics materials, etc.)
Pigment-grade titanium dioxide business termination

Achieving ROE that exceeds the cost of capital and improving PBRTransformation

02
Transformation

03

➢
➢

Cash flow management, asset compression through sales of ineffectively
utilized fixed assets
Capital efficiency improvement via active investment in growth businesses,
including M&A, and shareholder returns

Rebuilding the management foundation via materiality promotion
and accelerating non-financial initiatives➢➢

Complete quality/safety issue recurrence prevention measures
Initiatives for human capital management, the source of growth

SAKAI CHEMICAL INDUSTRY CO., LTD.

10

Transformation

01

Business Portfolio Transformation Policy

Accelerate the transformation of business portfolio management initiatedin the previous Mid-Term Plan
Business growth potential

Actively implement and expand
growth investments (including M&A)
Certain products such as
overseas plastic
additives and catalysts
Transitioning to stablebusinesses(as medium and long-term
growth businesses)

Businesses
considered for
efficiency
improvement
Plastic additives
Catalysts
Pigment-grade
titanium dioxide
project termination

Growth businesses
Electronic materials
Cosmetics materials

Accelerate the capture of market
needs as businesses driving medium
and long-term profit growth

Stable businesses
Transitioning tostable businesses
through revenue
improvement
measuresTitanium dioxideand zinc

Organic chemicals
Contract processing
Hygienic products

Transitioning to growthbusinesses as a pillar
alongside inorganic
chemistry(from FY 2024)

Maintaining and securing stable revenue

Transitioning into stablebusinesses in the new
Mid-Term Plan period

Medical Business: Focus on rebuilding GQP and GMP systems

SAKAI CHEMICAL INDUSTRY CO., LTD.

Profitability

11Profit Growth via the Business Portfolio Transformation Policy
For businesses considered for efficiency improvement, streamline operations by focusing
on businesses and products that can continuously contribute to revenue, transforming into
stable businesses. Expand profitability of growth businesses through investments inelectronics materials, cosmetics materials, and organic chemicals.
Pre-transformation

Operating income
FY 2023

Chemical Business

Growthbusinesses

Reference: previous MidTerm Plan annual averageElectronic materials

200

900

Cosmetics materials

million yen

million yen

Hygienic products

Stablebusinesses

Organic chemicals
Transitioning to a growthbusiness from FY 2024

2.3

2.5

billion yen

billion yen

Contract processing

Post-transformation Operating income
FY 2026

Electronicmaterials
Cosmetics
materials
Organic
chemicals

5.7
billion yen
Of which, organic
chemical products:
1.6 billion yen

Hygienic products
Contract processing

Businesses
considered
for efficiency
improvement

MedicalBusiness

Titanium dioxideand zinc

Plastic additives
Catalysts

Titanium Dioxide

Zinc
dust

2.7
billion yen

300

700

Plastic additives

million yen

million yen

Catalysts

100

400

200

million yen

million yen

million yen

Note: Excluding “Other” from the chemical business

SAKAI CHEMICAL INDUSTRY CO., LTD.

12

Overall Plan for Achieving Operating Income Targets
Shift to high-value-added products through business portfolio transformation
by working on the recovery and growth of growth businesses while enhancing
businesses considered for efficiency improvement
01 Business Portfolio Transformation
Transformation(+) Pricing adjustment(titanium dioxide, etc.)(-) Impact of catalyst
production siterationalization(+) Expansion of new products/
acquisition of new
customers, etc. in growthmarkets

90

billion yen

Structuralreform related totitanium dioxide

54billion yen

29billion yen(+) Reassessment of
personnel allocation(+) Pricing adjustment

FY 2023
Results

Impairment
impact, etc.

Businesses
considered for
efficiency
improvement

Capturingmarketrecovery ingrowthbusinesses *FY 2024
Plan

Impact of
Improvements Capturing
Increased
pigment-grade for increased market growthstabletitanium dioxide fixed cost ratio
in growthbusinessbusinessbusinesses * revenue, etc.
termination

FY 2026
Mid-term
Plan targets* Electronic materials/cosmetics materials/organic chemicals

SAKAI CHEMICAL INDUSTRY CO., LTD.

13

Business Strategy for Growth Businesses
In addition to electronic and cosmetics materials, position organic chemicals
as a new growth driver and work on further profit growth through growthinvestments in existing businesses and the utilization of M&A
Electronic materials➢➢

Target areas:

Electronics

Cosmetics materials➢ Sunscreen: Expand sales to overseas cosmetics
manufacturers through the proposal of surface treatment
technology and formulation (performance evaluation cleared,
production system established)➢ Cosmetic products: Upfront investments for contributing torevenue in the next Mid-Term Plan period

Direction of profit growth:Business growth potential

Dielectrics: Capture the high-end/mid-end markets with new
products, correct the pricing of unprofitable products
Dielectric materials: Product portfolio review (actively expand
sales of high-profit products and correct pricing of unprofitableproducts)

Organic
chemicalsElectronic materials(transitioning toa growth businessfrom FY 2024)

Cosmetics
materials

Target areas: Life science/Healthcare

Organic chemicals➢ Eyeglass lens materials: Allocate resources aimed atmaintaining and expanding the top market share forhigh-growth, high-refractive-index products➢ Active pharmaceutical ingredients/intermediates: Expand
existing contracted products further through facility expansion
and progress in CDMO
Electronics
Target areas: Life science/Healthcare

SAKAI CHEMICAL INDUSTRY CO., LTD.

Profitability

Circle size: Profit
Dotted line: Previous Mid-Term Plan;
Solid line: New Mid-Term Plan (FY 2026)

14

Growth Strategy: 1. Electronic Materials

Target areas:

Electronics

Develop and expand sales of high and mid-end dielectrics and dielectricmaterials matching multilayer ceramic capacitors (MLCC) trends, achieving
growth that exceeds market growthMarket growth potential

MLCC

8%/yearCompany
estimate

MLCC market expansion driven by digitalization, transition to EVs,
and advancements in generative AI
2.0

Capacitor shipment value (trillion yen)

1.5
1.0
0.5
0.0

2023

2026 (Plan)(Company estimate based on the World Semiconductor
Trade Statistics and JEITA statistical data)
Dielectrics/
dielectric materials

Highvalue-added

Strengths and initiatives

Technologicalstrength
Powderprocessing➢ Steady MLCC market growth driven byincreasing demand for more advanced andsmaller electronic devices➢ As the market grows, the demand forminiaturization, increased capacity, and higher
reliability of MLCCs expands

High and mid-end demand expansion based on MLCC trends➢ As the market grows, demand for high and mid-end dielectrics and dielectric materials is
expanding based on the need for miniaturization, high purity, and high uniformity

Product development flexibility and speed➢ Development/deployment of barium
titanate and high-purity barium
carbonate matching MLCC trends,
utilizing the expertise and know-how
accumulated over many years in
powder processing technology➢ Development and expansion of newelectronic materials (Sciqas andmultithiols)

SAKAI CHEMICAL INDUSTRY CO., LTD.

Integrated approach to procurement,
Supply manufacturing, and sales

chain➢ Build a robust supply chain
capable of integrated response
from raw material procurement tomanufacturing and sales (BCP
compatible)➢ Diversification of procurement
sources15

Growth Strategy: 2. Cosmetics Materials Target areas: Life science/Healthcare
Realize growth beyond that of the market with high-functioning and uniquely
competitive products
Sunscreen
Market growthpotential

growth x inorganic shift
5%/year Market➢ Increased awareness of sun protection
Company
estimate

Strengths and initiatives

Technologicalstrength
Powderprocessing

and skin lightening overseas➢ Progress in replacing high-environmentalimpact organic absorbers with lowenvironmental-impact inorganic
scatterers→ Growth prospects surpassing traditional
growth rate

Enhancement via surface
treatment and micronization➢ Functionality enhancement using
powder processing technology with zincoxide and titanium, the foundational
materials of our original business➢ Transparency through ultrafine
particleization➢ Granting high dispersibility withsurface treatment➢ Expand sales to overseas cosmetics
manufacturers (performance evaluation
cleared, production system established)➢ Accelerate expansion of overseas
markets, focusing on highly profitable zincoxide-based products

SAKAI CHEMICAL INDUSTRY CO., LTD.

5

Cosmetic products
Market growth x%/year MPB alternative shift

Company
estimate

Product
development
capability➢ Progress in replacing materials ofconcern for negative impacts on
ecosystems, such as microplastic
beads (MPB), with materials thathave less impact on theecosystem→ High growth prospects withincosmetics market

Unique material lineup➢ Accelerate development/expansionof cosmetics materials➢ MPB alternatives:
Barimaru/Calmaru➢ Unique cosmetics materials:
plate-like barium sulfate,hexagonal plate-like zinc oxide,
Electron microscopeand phosphors for cosmetics
photographof Calmaru➢ Implementing upfront investments(particle diameter:(capital investments) aimed at
5μm)contributing to profits in the next MidTerm Plan

16

Electronics

Growth Strategy: 3. Organic Chemicals

Target areas: Life science/Healthcare

Promote a niche top strategy leveraging technology/quality as strengths,transitioning to a pillar business alongside inorganic chemistry
Active pharmaceuticalingredients/ intermediates

Eyeglass lens market growth x highrefractive index demand expansion%/yearStrengthening
manufacturing capacity

6

Company
estimate

High quality
thiol products

Top position in niche markets➢ Continuation of stable high-quality raw
material supply to top-tier domestic
companies in Japan➢ Limited companies capable of supplying
high-grade thiol products, and in the highbarrier niche market, our company has
established its technology and knowhow➢ Inputting resources for strengthening a top
share position→ Securing stable revenue + capturing market
growthSAKAI CHEMICAL INDUSTRY CO., LTD.

Strengths and initiatives

Strengths and initiatives

Technologicalstrength➢ Global myopia population reached 2.6 billion
in 2020, an increase of 30% over ten years.
Estimated to reach 4.8 billion by 2050
(International Myopia Institute)➢ Eyeglass lenses are projected to grow at anannual rate of 3%, with high refractive index
type, which is the end-use, expected to growat an annual rate of 6%(company estimate)→ High growth prospects within eyeglass lensmarketContracted quantity
increase

Market growth potential

Eyeglass lens materials (high refractive index type)➢ Implementation of production
expansion investment (revenue
contribution is expected from the next
Mid-Term Plan period)➢ Further expansion of existingproducts, acquisition of new
projects➢ Capture future pharmaceuticalmarket growth

Extensive
contracting experience➢ Establish manufacturing knowhow through extensive contracting
experience, including with majorclients over a long period➢ Evolution from CMO to CDMO
➢ Lineup expansion throughdevelopment of diverse synthesis
processes

17

Business Strategy for Businesses Considered
for Efficiency Improvement
Focus on businesses and products that can continuously contribute torevenue, transforming into stable businesses
Direction of profit improvement/growth:Business growthpotential

Titanium dioxideand zinc➢ Elimination of deficits through price corrections, etc. (FY2024)➢ Termination of pigment-grade titanium dioxide business(FY 2025), which has low capital investment efficiency andhigh environmental impact in the production process, andimplementation of structural reforms, including
improvements for fixed cost ratio reduction→ Zinc dust, etc. products transitioning to stable businesses

Plastic additives(overseas)

Plastic additives
Catalysts➢ Domestic: Withdrawal from contract-manufactured leadbased stabilizers (FY 2025)➢ Overseas: Shift to non-lead stabilizers (implementing
production increase investments) and expand sales in
the ASEAN region→ Transition to stable businesses from an overseas shift
Catalysts➢ Efficiency via consolidation of production bases (FY2024),
cost reduction through yield improvement➢ Revenue improvement via low-profit product pricecorrections→ Transition to stable businesses via consolidation of
production bases and price corrections

SAKAI CHEMICAL INDUSTRY CO., LTD.

Zinc
dust

Oxide
titanium/Zinc

Pigment-grade
titanium dioxidebusiness termination

Plastic
additives(in Japan)

Profitability

Circle size: Profit
Dotted line: Previous Mid-Term Plan;
Solid line: New Mid-Term Plan (FY 2026)

18

Transformation

02

Achieving ROE that Exceeds the Cost of Capitaland Improving PBRPromote efforts strongly focused on capital efficiency to achieve
the ROE target of 8% for FY 2026
ROE and PBR performance trend
ROE
0.5

0.4

Detailed initiatives

1 Shift to high-value-added

PBR
0.5

0.6

0.5

products via business portfoliotransformation
0.5

0.4

0.4

➢

0.4

0.4

➢

8.7%

Asset compression
3.3%

2.6% 3.0%

3.0%

2

4.6%

3.0%

➢ CCC improvement➢ Sale of underutilized fixed assets

2.9%

▲3.6%

3 Capital efficiency improvement

21/3➢ Active investment in growthbusinesses, including M&A➢ Implementation of shareholder
returns

▲9.2%
15/3

16/3

17/3

18/3

19/3

Development acceleration of growthbusinesses
Pigment-grade titanium dioxide businesstermination

20/3

22/3

23/3

SAKAI CHEMICAL INDUSTRY CO., LTD.

24/3

19

Capital Allocation (Three-Year Cumulative)
Allocate cash gained from profit generation, CCC improvement, and fixed
asset sales to capital investment, shareholder returns, and M&A
Shareholder Returns Policy

Fundraising
Loans and warrants
Convertible note (procured)

M&A

Fixed asset sales

CCC improvement

7 billion yen➢ Implement dividends passing
previous levels, targeting a DOE of
3%➢ Implement flexible share buybacks

Capital investment plan
Shareholder returns

Over 8 billion yen

Operating CF
34 billion yen

Cash-in

Capitalinvestment
20 billion yen(including
restructuring
investments)

58%

Growth
42% investments➢ Growth investments aimed at production
expansion investments related to growthbusinesses (electronic materials/cosmetics
materials/organic chemicals)

Cash-out

SAKAI CHEMICAL INDUSTRY CO., LTD.

20

Shareholder Returns Policy
Shift guideline for shareholder returns from dividend payout ratio to DOE
Total return trend
27

Treasury stock acquisition
Total dividends(billion yen)

18

18

17

10

10

10

29

27
20

20

15

20

7

8

8

7

7

9

7

15/3

16/3

17/3

18/3

19/3

20/3

3
3
21/3

12

11

12

12

11

22/3

23/3

24/3

20
25/3
(plan)

Shareholder’s equity(billion yen)

73.4

74.0

74.3

73.9

74.7

76.6

73.2

77.8

78.9

71.2

-

DOE

1.0%

1.0%

1.0%

0.9%

1.1%

0.9%

0.3%

1.5%

1.5%

1.5%

3%

Net income for current
fiscal year (billion yen)

2.3

2.3

2.0

2.3

3.6

2.5

(2.8)

6.7

2.3

(7.1)

43

Dividend payout ratio

35%

33%

37%

31%

24%

27%

-

17%

52%

-

47%

Dividend per share (yen)

8

8

8

24*

50

40

15

70

75

70

125

* A reverse stock split was implemented in FY 2017

Shareholder Return Policy for FY 2024 - FY 2026
Implement dividends passing previous levels, targeting a DOE of 3%.
Implement flexible share buybacks
Consider additional shareholder returns if profit plans are exceeded

SAKAI CHEMICAL INDUSTRY CO., LTD.

21

Transformation

03

Materiality Promotion and
Accelerating Non-Financial Initiatives

Incorporate into executive evaluations, ensuring management to site workers is involved
1. Make people happy
KPI
Serious labor accident
occurrences: 0

Initiatives
Implementation of safety and health activities by
everyone from management to site workers

Establishment of a Human Capital Committee,
Engagement
engagement improvement
improvement:
FY 2025
Dialogue opportunities between management
Above average thirdand employees (increase opportunities forparty evaluation score
dialogue, such as holding town meetings, etc.)
Promotion of diversity:
By FY 2030, achieve 20% Mid-career recruitment promotion for women
employment rate of
women in core positions Conduct empowerment training and operate
subcommittees creating work environment forand 10% in managerial
women to thrive
positions

3. Solve social issues through manufacturing
KPI

Smart Material
certified products andservices:
Five products on themarket by FY 2030

Initiatives
Cosmetics materials Barimaru/Calmaru (MPB
alternative products), plate-like barium sulfate,hexagonal plate-like zinc oxide, and phosphorsfor cosmetics
Spherical silica Sciqas: Leveraging thecharacteristics of true spherical and fine particles
for expansion into 5G and 6G-related products
Water electrolysis catalyst IR/ENETIA:
contributing to carbon-neutrality
Multithiols: Expansion into electronic material
applications utilizing thiols’ flexibility

2. Protect the global environment
KPI

Initiatives
Termination of business involving
high environmental impact products(pigment-grade titanium dioxide)

CO2 emissions
reduction:
Shift towards more compact andReduction of 30% in FY
efficient manufacturing2030 in comparison to FY
2013

Implementing renewable energy
Environmental accident
occurrence: 0

Implement monitoring system forpreventing environmental accidents

4. Build a strong, transparent
management system
KPI

Number of serious
compliance violations: 0

Initiatives
Review of information sharing,
including with affiliated companies(review of group meetings,
communication frequency
improvement, etc.)

Improve effectiveness of the Board of
Directors (utilization of evaluation
surveys, etc.)

Other initiatives in 3.: Conduct and implement CSR procurement surveys and improvements based on the human rights due diligence plan

SAKAI CHEMICAL INDUSTRY CO., LTD.

22

Human Capital Management Policy
Our Company aims to become a strong organization where employees take initiativein solving individual and organizational challenges, trust themselves and theircolleagues, and can grow sustainably
Sustainable

Human resources
portfolio enhancement

All-inclusive
management

Aim for “all-inclusive management” where all employees takeresponsibility for their work, engaging proactively

Engagement improvement
Managementfoundation
reinforcement

Promoting Diversity, Equity& Inclusion (DEI)

Employee engagement improvement

Improving respect for diversity and well-being(everyone living happily in their own way)

Holding monthly meeting “syain kai,” meetings
where employees share information to work
proactively toward solving individual andorganizational issues, and town meetings→ Communication opportunities between
management and employees
Group activities beyond organizationalboundaries and implementation of an open
recruitment system➢ Diverse talent, education, andemployment forms➢ Roundtable parental leave discussions,career-related panel discussions, andpublication of a diversity newsletter➢➢

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KGI and KPI List
Operating income: 9 billion yen
Financial
objectives(FY 2026)

Nonfinancial
objectives

ROE: 8%KGI◆ Growth businesses: Operating profit◆ CCC: No more than 180 days
composition of 60% or more
◆ Businesses considered for efficiency
improvement: Focusing on businesses able
to contribute to revenue, transforming into
stable businesses

1. Make people happy

2. Protect the global environment◆ Serious labor accident occurrences: 0◆ Engagement improvement: FY 2025
Above average third-party evaluationscore◆ Promotion of diversity: Achieve 20%
employment rate of women in core
positions and 10% in managerial positions
by FY 2030

◆ CO2 emissions reduction: Reductionof 30% in FY 2030 in comparison to
FY 2013◆ Environmental accident occurrence: 0

3. Solve social issues
through manufacturing

4. Build a strong, transparent
management system◆ Smart Material certified products andservices: 5 products on the market by FY
2030

SAKAI CHEMICAL INDUSTRY CO., LTD.

KPIs

◆ Number of serious complianceviolations: 0

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What chemistry can do to create the lifestyle of 2050
Becoming “an excellent company capable of contributing to society with Smart
Material”
2

1

Support the development of an advanced
information society (for a more equal society)Support
People’s Health3

Protect nature(protect the global
environment)

Electronicmaterials

Catalysts

Organic
chemicalproducts

Human capital

Cosmetics
materials

Core technology
Organicsynthesis

Powder processing

Chemistry for a Friendly Future

Corporate Management Creating materials that support the comfort
concept
missionand security of society through compassion

Pharmaceuticalmanufacturing

Exciting Company

Organizational We will build an exciting
visioncompany together

and technological innovation

SAKAI CHEMICAL INDUSTRY CO., LTD.

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Cautionary Notes Regarding Forecasts

This document is for informational purposes only and is not intended
to solicit any specific action. This document (including performanceplans) has been created by Sakai based on the data available at thetime and includes risks and uncertainties, please note that actual
performance may differ.
Use this document at your own discretion. Sakai is not responsible
for any losses incurred from investment decisions made relying on
the forecasts and target figures in this document.

SAKAI CHEMICAL INDUSTRY CO., LTD.

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