Ryosan Company, Limited

9th Medium-Term Management Plan

June 20, 2014
President, Naoto Mimatsu
0Corporate Philosophy (RS21)

Fundamental
BeliefBasic
Philosophy(Business &Mission)
ManagementPhilosophy(ManagementPrinciples)● Strong belief that “the corporation is a publicinstitution.”● Enhance electronics system coordination● Facilitate the harmonious fusion ofhuman and technological progress● Grow as a mission-based corporation● Create corporate value● Increase value convertibility
1Three functions (essential functions of an electronics systems coordinator)

Constantly evolving these three functions enhances
the level of customer satisfaction and our value“The Information Function” “The Solutions Function”“The Distribution Function”

Provide customers with accurate
information by gathering data on theIntegrate expertise and knowledge
with advanced technology toDeliver what the client needs at therequired time and in optimum

needs of the times and the trends intechnology

contribute to client solutions

condition

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Management Environment and Issues to be Addressed◆ Management Environment (Electronics Industry)・ Expansion of horizontal specialization alliances & reduction of entry barriers
・ Slow growth of Japanese market & growing number of Japanese corporations
shifting production overseas/engaging in overseas procurement
・ Diversifying customer needs (from individual components to modules andOEM/ODM)◆ Issues to be Addressed・ Reconstructing our business portfolio
・ Expanding our corporate activities on a global scale
・ Revising our profit/financial structure3

Basic Stance

Basic stance of the 9th Medium-Term Management Plan

“Innovation”
and “growth”
Pursuing a business model shift which responds to changes in our business structureand sustainable independent growth
Universal Management Policy
Pursuing management essence, advancing management innovation, and yielding
management results are the keys to conducting open and transparent corporate
management and business activities with abundant creativity.

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Growth Strategies◆ Further promotion of multi-vendor support to respond to customers’
diversifying needs◆ Strengthening global support to expand overseas business◆ Strengthening system solution capabilities (capabilities in systemengineering plus embedded systems) to create new business models
5Further promotion of multi-vendor support to respond to customers’ diversifying needs

FuturePast・NXP Semiconductors N.V.
・Macronix International Co., Ltd.
・Entropic Communications, Inc.
・Everspin Technologies, Inc.
・THine Electronics, Inc.

GYRONICS
PresentConsider M&A

・Winbond Electronics Corp.
・Micrel Inc.
・STMicroelectronics N.V.
・Applied Micro Circuits Corporation
・Atmel Corporation
・Faraday Technology Corporation

・ON Semiconductor
・Yamaha Corporation

No. of supplier・・・・・・Customer needs for which response is possible

・Renesas Electronics Corporation6

Strengthening global support to expand overseas business

Germany
・Follow-up overseas shift ofJapanese clients

South Korea
・Design-in and sales for Korean
corporations

China/Hong Kong
・Design-in and sales for Chinese
corporations
・Follow-up overseas shift of Japaneseand American clients

United States・Follow-up overseas shift ofJapanese clients

Japan・Design-in and global expansion
support for Japanese clients

Taiwan・Design-in and sales for Taiwanese
corporations

India
・Design-in and sales for Indian
corporations

Shared Theme in All Countries
Singapore/Malaysia/Thailand
・Follow-up overseas shift ofJapanese and American clients・Develop unique semiconductor andelectronic component manufacturers

7Strengthening system solution capabilities to create new business models

Ryosan’s System Solution
Systems Technological Capability (Realization)

Embedded Systems Capability (Coordination)

・Enhance system technological capability in・Implement value-added proposals based on

growth fields and high-consumption fields

our core in-house technology (modules,boards, etc.)

・Accumulate element technology in theabove fields

Modulemanufacturers
Components
manufacturers

Material
manufacturers
System consignment manufacturers(design, manufacturing)

Etc.

Clients
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Segment Strategies

Semiconductors
segment
strategy

Seeks to expand our business by strengthening design-in
activities for products of the major manufacturer Renesas
Electronics and foreign semiconductor manufacturers.

Electroniccomponents
segment
strategy

Seeks to expand our business in fields such as car electronics

Electronicequipment
segment
strategy

Seeks to expand our business by strengthening our embedded system capability as abase for focusing on our system solution business which promotes module andcomponent business through new resources, as well as by strengthening our facilities
equipment business through advancement of the 3 business elements of hardware,materials and service.

and industry by augmenting sales promotion activities which
are aligned with supplier strategy.

9Segment Strategies

Ryosan products
segment
strategy

Technology
strategy

Although transfer of the heat sink production business to Sankyo
Tateyama, Inc. scheduled for September 1, 2014, Ryosan will continue
to focus on sales activities for heat sinks as an agent.

With a focus on semiconductor technology that we have accumulated over a
period of many years as a technological trading company, the Ryosan Group will
expand the field of technical support for electronic components and embedded
products, and shall strengthen system technological capability which supports
system solution capability.

10Infrastructure Strategies◆ Reinforcing management in terms of quality
・ Strengthen governance through outside directors and outside auditors.
・ Enhance global internal controls.
・ Strengthen CSR at group companies.
・ Enhance global risk response capability (legal and tax aspects).

◆ Strengthening of our management structure(Strengthening of consolidated management)

・ Develop global information system (sales, logistics, accounting).
・ Develop system to strengthen the profit/financial structure of group companies.
・ Increase efficiency of headquarters functions (Headquarters Management Division).
・ Utilize human resources through diversity management.

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Basic Policy Regarding Redistribution of Profits to the Shareholders◆ Basic policy

・ Sustain stable and high dividends; seek resumption of 80 yen
dividends by FY2016.
・ Continue to consider share repurchases based on trends inconsolidated business performance, etc.
◆ Consolidated dividend payout ratio

・ 50% or higher each year.

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