New Long-Term Management Plan
SANYO VISION 2028
Deliver tangible solutions to social issues to makethe world a better place for everyone

Sanyo Trading Co., Ltd.
November 22, 2023
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

INDEX

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

1

01

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

2

01-1

MVV – Corporate Philosophy
Challenging ourselves for the BEST solution
We foster an open, down-to-earth, and entrepreneurial
corporate culture that drives our collective efforts todeliver the best solutions flexibly and timely so that we
can help achieve the sustainable development of the
global community and fulfill employees’ aspirations forwell-being.

Deliver tangible solutions to social issues to makethe world a better place for everyone
Act with integrity

We observe laws, regulations, and professional ethics in everything we do.

Be a challenger

We build a future full of opportunities and creativity.

Demonstrate agility

We make the right decisions at the right time and act on them effectively.

Pursue innovation

We stay abreast of social and economic changes and seize opportunities
for growth and success.
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

3

01-2

Our Vision for 2028

Sanyo Trading’s
VisionDeliver tangible solutions to social issues to makethe world a better place for everyone
The wisdom left by our founder: “Don't do anything that lowers our reputation.”

Job that makes apositive impact onsociety

Job to solve
problems

Ourvalue proposition

Job where we caninspire children to
dream

Building a track record of excellence that addresses:
Safety andsecurity

Comfort and
QOL*

Carbonneutrality

Organic growth ofexisting businesses
Our businessfoundation

Job that caters tocustomers and isappreciatedHuman
resources
Professional expertiseand know-how

Merchandiseand commercial
rightsSingle-source
procurement, strong
relationships of trust

Energy andresource
conservation

Local production
for local
consumption&

Technologydriven, maritime
nation

Revitalizationof regional
economyAging
population

Fruition of new businesses

Open andinclusive
Good corporate culture

Financialfoundation

Globalnetwork
16 locations in
10 countries*QOL: Quality of life
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

4

01-3

Brand Concept

At Sanyo Trading, we don’t just sell merchandise.

We only do business in which we can add value and make a difference.
Instead of being a box mover, providing materials, products, andsolutions most relevant to your enterprise needs is our commitment.
Trust is what it takes to succeed in business.
That’s why we listen to you and deliver the best solutions for the successof your business flexibly and timely—and in the belief that, by doing so,
we’re bringing a brighter future to people around the world.

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

5

01-4

Corporate Slogan

In pursuit of the best solutions for a better future
It is our commitment to demonstrating the foresight and vigor with whichto pursue the best solutions for bringing a better future to the earth andall of you.

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

6

01-5

Corporate logo

Foresight with which to pursue the best solutions
The logo’s dynamic and lively form denotes our foresight and entrepreneurship, as wellas our resolve to pursue innovation. Its sky blue color signifies a bright future with thegreen dot in the letter “i” representing a human face and the global environment.
This corporate logo symbolizes Sanyo Trading’s commitment to bringing a better future
to the earth and all of you, true to our Vision of “delivering tangible solutions to social
issues to make the world a better place for everyone.”

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

7

01-6ESG ~ Sustainable improvement of corporate value in a VUCA(*)
business environment
Sustainable improvement of corporate value

E nvironment
Positive cycle

Economic value

Recognizing that environmental issues such as
climate change are a global concern and considering
decarbonization, protection of biodiversity, and othermitigating measures

Establishment and execution of strategies withthe advice and supervision of the Board of Directors

G

S ocialSocial value

Open-mindedness and Unwavering and Enterprising Spirit
Supervision

Securing human resources to support directors andmanagement, properly allocating human capital, andconsidering human rights and wellbeing

Relationshipsof trust

Board of Directors

Executives

ReportingGovernanceE

Properly understanding risks and opportunities,
establishing and executing strategies through the
combination of management supervision andexecution, and achieving sustainable improvement incorporate value through a virtuous cycle in which
economic and social value are mutually enhanced

Environmental

Global warming and decarbonization

Geopolitical volatility

Change in industrial structure

Digitalization

Conservation of natural capital and biodiversity* VUCA is an acronym that stands for Volatility, Uncertainty, Complexity, and Ambiguity.

SocialConstantly changing risks and opportunities
Aging population

S

Diversity

Diversification of values

Infectious diseases

Well-being

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

8

01-7Materiality
Solving social issues throughbusiness activities

Stakeholders

Strengthening the business base that
supports sustainable growth

Reduction of environmental impact

Providing spirituallywealthy lives

Reinforcing solidmanagement structure

Active participation of diverse
motivated human resources

Contributing to tackling climatechange and building a recyclingbased society by offering
environmentally friendly products

Contributing to realizing healthy,
secure, comfortable lives by
pursuing appropriate products
and ensuring their stable supply

Ensuring financial soundness andstrengthening corporate
governance and legal compliance

Developing human resources
who create new value, respecting
their diversity, and providingthem with opportunities for
active participation

Earth

Customers

Shareholders

Employees• Number of QOL-related products• Percentage of independent
outside directors• Number of compliance consultations• Shareholders’ equity ratio

SDGs

KPI

• Number of environmentallyfriendly products handled• Greenhouse gas emissions• Turnover rate
• Percentage of female managers• Training expenses

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

9

02

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

10

02-1Review and Quantification of Previous Long-term Management
Plan: VISION2023
Quantitative Targets(Fiscal year ending
September 30, 2023)

Consolidated
ordinary profit

Result7,500 million yen

7,100million yen

ROE

15.0%

11.8%

Growth rate (sales)at overseas offices

10.0%p.a.

12.9%p.a.
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

11

02-2Review and Qualification of Previous Long-term Management Plan:
VISION2023
Basic strategies

Seven strategies

A

Strengthening
the corporate
structure

B

Challenging ourselves for theBEST solution

Strengthening the Company’s
foundation

Evaluation○

Achievements•

The management mission and basic principles became instilledin employees.

•

We developed organizations that will serve as the foundations
for growth (New Business Development Dept., Strategic
Logistics Dept., Human Resources & General Affairs Dept.,
Corporate Planning Dept.).
We acquired Cosmo Computing System, Inc., to strengthen
inhouse IT function.

△•C

Investing in human resources△D

Enhancing business in certain
fields△E

Developing new businesses

Accelerating globalization○

G

Advancing new investment
projects○

Our slogan “Challenging ourselves for the best solution” remains
unchanged from SANYO VISION2028 onwards as it still needs tobecome more deeply ingrained across the group.

•Strengthening corporate functions to accommodate businessexpansion
Deepening ESG management
Promoting DX••

HR development, education and training
Strengthening of hiring capabilities
Flexible allocation of human resources based on groupwide
optimization approach•

Strategic allocation of resources through greater selection andconcentration

Business divisions: Identified products related to new
businesses based on a product-out approach and expanded
sales.
New Business Development Dept.: Pursued projects that havesynergies with us based on a market-in approach.

••Strengthening of market-in approach
Nurturing of potential core businesses•

We pursued overseas expansion focusing on Asia and theAmericas••Strengthening of overseas management system
Further expansion of network (Europe, etc.)•

We made bolt-on investments in businesses in which synergy
with existing businesses can be expected such as Yp Techand Scrum••

Realization of synergies in investment projects
Preparation of new pipeline projects

We invested in next-generation human resources, developing
human resources internally and also hiring mid-career
professionals who can hit the ground running•

Levering our strengths, we further developed high added value
businesses, focusing on four core markets.

•

•

F

•

•
•
•

•

○

Strengthening
the earnings
base

Ongoing challenges

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

12

03

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

13

03-1Perceived Business Environment
Megatrends
attracting
attention

Impact on
the Company

1

Sustainability
Climate change, etc.

3

Low birthrate andaging population• Progress in the shift to EVs• Growing demand for materials with low
environmental impact and renewable energy• Growing demand for safe, secure andcomfortable lifestyles

4• Growing demand for medical health care•

More opportunities to expand new business(Materials with low environmental impact, safety and security, aging
society, conservation of resources, DX, etc.)•

The decrease in demand for petrochemical-derived raw materials andthe increase in demand for naturally derived materials.

Selection and concentration
Our measuresin light ofmegatrends

2•Technologicalinnovation

Globalization• Digital transformation• Disruptive innovation• Borderless business• Market expansion and increasing
opportunities

Fierce competition to recruit talent due to fallingbirthrate and aging population and mobility ofhuman resources

Strategic allocation of resources to growing areas through constant business portfolio management

Creation of new core businesses

Nurturing of next-generation core business aligned with megatrends

Human resources development

Acquisition and development of talented human resources

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

14

03-2New Opportunities and Our Strengths and Competitive Edge
Our Strengths and Competitive Edge

New opportunities

Reduction of environmental impact(Promotion of products withlow environmental impact)

Good work

Providing spiritually wealthy lives

Management system based on “free and open” corporate
culture and "unwavering and enterprising spirit”

Human
resources

Technical knowledge
Strong relationship of trust based on
business dealings over many years

Products
andservices

Provision of solutions that provide
customers with total support

Finance

Solid financial base and financial power

Network

Information capability and network
created through domestic andoverseas sites(Quality of Life)

Overseas expansion that keeps us close
to Japanese enterprises
Overseas
expansion(product-out approach)Possibility of further network expansion(market-in approach)

Driving further growth
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

15

03-3Sanyo ModelManagement
resources

A solution provider serving closely to customers instead of merely selling goods

Business models• Offer value-added services• Provide full support for customers’ manufacturing, fromdesign and development to maintenance• Offer technological support helpful to stable manufacturing

Expertise andKnow-How

Design anddevelopment
Research andplanning

Prototyping

One-stop
services

1 product from
1 supplier

16 locations in
10 countries

Solving social issues

Maintenanceand after-sales
services

Earth

Mitigation ofenvironmental
impact, protectionof biodiversity, etc.

Provide solutions Customers
PeopleMassproduction

Just-in-time andconstant supply(Materiality)

Providingspirituallywealthy lives

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

16

04

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

17

04-1Chart Comparing Old and New Long-term Management Plans(Continuity and Evolution)
VISION2023

Strengthening the earnings base

SANYO VISION 2028

Strengthening the earnings base

D Enhancing business in certain fields

1

Growth of existing businesses

E

Developing new businesses

2

Developing new businesses

F

Accelerating globalization

3

Strengthening consolidated
management structure

4

Advancing investment projects

G Advancing new investment projects

Strengthening the corporate structure

Corporate management

ourselves for the
A Challenging
BEST solution

A

Corporate culture

Strengthening the Company’s
foundation

B

Human capital

C Investing in human resourcesC

SustainabilityD

Use of IT

B

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

18

04-2Priority Measures under SANYO VISION 2028

VisionStrengthening theearnings baseMeasures to realize
visionCorporate
management

Measures to increase
the resilience ofmanagementfoundation

Contributing to solving the world’s problems andputting smiles on the faces of people and the planet
1

Growth of existing businesses

Realization of growth through hybrid approach combining product-out and market-in approaches

2

Developing new businesses

Investment in new businesses and nurturing of potential core businesses

3

Strengthening consolidated
management structure

Further development of global business division system and expansion of overseas sites

4

Advancing investment projects

Rapid, flexible advancement of bolt-on investment in new businesses based on basic policies

A

Corporate culture

Elevation of positive corporate culture into an inimitable competitive advantage to pass on to next
generation

B

Human capital

Putting into practice measures embodying the idea that Sanyo is a people company

C

Sustainability

Provision of value to stakeholders through improvement of ESG management and disclosureD

Use of IT

Promotion of “offensive” and “defensive” DX by moving system development in house

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

19

04-3Optimum Allocation of Management Resources◼ Step up more flexible and strategic allocation of resources (people and money)High
Businesses to foster = Potential core businesses

Growth businesses
Current size of gross profit

Cultivate new projects and develop
them into future core businesses→ Provide companywide support

Market growth rate

Examples: benchmarking, naturally derived materials,
environmentally-friendly products

Renewable energy

Biotechnology

Chemicals

Future size of gross profit

RubberMaterial solutions

Strategic allocation of resources
Select(Turnaround or rationalization &streamlining or withdrawal)

Investment
Industrial materials
Scientific equipment

Businesses needing to be considered

Low

Livestock feed raw
materials, etc.

Livestock feed equipmentrelated products

Business growth cycle
Infrastructure businesses

Relative market share*High* Relative market share: Ratio of a company’s share to the share of the company with the largest share of the market

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

20

04-4Allocation of Cash to Growth Investments
Business investment basic policy
Balance sheet

Utilization of borrowed capital with shareholders’ equity rate of 50% or more and DE ratio of less than
0.5 times as yardsticks

Pre-condition

Importance is attached to business synergy, overseas expansion and growth potential

Long-term holding

Make investments for growth but do not engage in the buying & selling of assets or speculative
investment to realize a capital gain

Operatorship

Take operatorship of businesses by adopting a Buy & Hold stance and determining the direction forprogress ourselves

Planning to make growth investments totaling 20~30 billion yen over 5 years
Business
investment

Carefully select M&A deals that match our basic policy and proceed rapidly, flexibly and proactively

DX-related
investment

Make DX-related investments to increase efficiency, deliver high added value and win new business
opportunities

Human capital
investment

Make human capital investment in areas such as recruitment, education and training to promote the ideaof Sanyo as a people company

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

21

04-5Growth Scenario (Pipeline projects Excluding M&A)
New materials
and films

Ocean
Functional
resources
Foodmaterials
development additives
for tiresNew
chemicalproducts

Sensors toprevent
children frombeing left in
Cosmetics
vehiclesNewfunctional
feeds

Environmentallyfriendly
products

Operating profit

Electricalmaterials
andchemicals

Automotive
Naturally
derived benchmarking
materials
200 million
yen or more

100 million
to 200
million yen

Strengthening of earnings base of existing businesses
50 million
to 100
million yen

2023

2024

2025

2026

2027

2028

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

22

05

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

23

05-1Financial Targets
Creation of shareholder value (FY2028/9 Targets)
ROE

Growth and financial discipline (FY2028/9 Targets)
Operating cash flow

10-12%
GrowthOperating profit

20.0 billion to
30.0 billion yen(Cumulative for 2023-2028)

9.0 billion yen(business investment, DX investment,
human capital investment, etc.)

Based on continuous dividend increases and stabledividends, taking into account consolidated
performance and financial condition. Acquisition of
Shareholder returns
own stock will be carried out in a flexible and agile
manner, comprehensively considering stock prices
and demand for funds for growth investments.

PBR

Investment

Cash surplus

Profitability

Operating profit ratio

Stability

Shareholders’ equity ratio

5.1%

50% or more

More than 1
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

24

05-2Financial Targets ~Operating Profit by Segment~
Operating profit by segment(Million yen)

Chemicals

14,000Machinery& Industrial
Products

Overseas
Subsidiaries

Changes in operating profit by segment
Others andAdjustments

12,0009,000

10,000

2,344

8,000

6,740

6,000

1,347

1,310

6,000
4,000

4,450

4,130

2,185

2,140

-1,243-1,580

FYE
September
2023

FYE
September
2024

2,000
0
▲- 2,000▲- 4,000

2023年9月期

2024年9月期(Million yen)997

-1,182

9,000

1,090
5,540

6,740

1,356

FYE
September
2023

Chemicals

3,541-2,425FYE
September
2028

2028年9月期

Machinery& Industrial
Products

Overseas
Subsidiaries

FYE
Others
Septemberand2028
Adjustments

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

25

05-3Shareholder Returns
Based on continuous dividend increases and stable dividends, taking into accountconsolidated performance and financial condition

Dividends

Implementation in a flexible and agile manner, comprehensively considering stock prices
and demand for funds for growth investments

Purchase of treasury shares(Yen)

Interimdividend
中間配当70

Year-end
dividend
期末配当

Steadily increase
dividends per share

60

50

40

30
15.5

20

12.5
7.5

10
12.5

7.5

2013.92014.9

22

19

21

21

2022.92023.9

19

20

21

18.5

18.5

19

2019.92020.92021.9

17

13

9.5

7.5

22

18.5

12

11.5

14

2015.92016.92017.915

2018.902012.92024.92028.9(forecast)

Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

26

06

01

Sanyo Trading’s Vision

02

Review of the Previous Long-Term
Management Plan (VISION2023)

03

Current Situation

04

SANYO VISION 2028

05

Financial Targets

06

Market Outlook and Policies by Segment
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

27

06-1Market Outlook and Policies by Segment
Segments

Chemicals

Machinery& Industrial
Products

Business Unit

2028 Market Outlook

Policies

Rubber• Domestic synthetic rubber manufacturers will shift towards high added value,
next-generation materials• The automotive industry, which accounts for half of synthetic rubber demand,
will shift towards EVs• Meet demand for synthetic rubber among Japanese enterprises bothin Japan and overseas by upscaling handling of imported products ofhighest quality• Expand sales of our own next-generation indirect materials

Chemicals• Ink market: The market will shrink on a macro level but, on a micro level, UV
inks will expand• Paints and coatings: Slight growth• Adhesives: Stable• Leverage high added value products and environmentally products
and focus on high end market in addition to existing market• Promote technical sales and the handling of new productsLife Science(MS*1)• Growth in demand for automotive LiB and high performance electricalmaterials• The “Health” and “Organic” domains are expected to grow

• Pursue sales expansion of related parts and materials• Identify naturally derived products and handle more of themIndustrial
materials• Acceleration of EV development among Japanese automakers• Changing demand for autoparts associated with advances in CASE
technologies• Develop interior parts and materials and sensors which are in
growing demand for to the EV shift• Explore new business that incorporates selling functions instead ofthings (ex. benchmarking, etc.)

Greentechnology• Acceleration of scaling-up and rationalization of feed production facilities
associated with reorganization of the industry• Expansion of demand for renewable energy associated with decarbonization• Utilize positioning to tap into capital investment demand• Steadily capture large projects and develop nee domains

Life science(Scientific
Instruments)• Market for scientific, analysis and test equipment will remain stable overall• Direction of bio-related business development: focus on field of genetic
analysis• Focus on the materials and chemicals field including nanotechnology,
and the environmental field• Leverage Scrum and KOTAI in bio-related business to meet coreneeds

• Acceleration of EV shift (especially noticeable in China and Europe)• Rubber: Continued tendency among Japanese enterprises to shift
production overseas• Chemicals: Expansion of Asia market• Pursue business expansion based on market-in approach• Focus on Southeast Asia (especially Thailand, Vietnam, Indonesia,
and Singapore) in the chemicals business and leverage M&A toachieve business expansion

Overseas Subsidiaries*1 MS: Material solutions
Copyright © 2023 SANYO TRADING CO., LTD. All Rights Reserved.

28