May 7, 2021
JFE Holdings, Inc.

JFE Issues Seventh Medium‐term Business Plan to FY2024
Biggest transformation in company’s history aimed at achieving global success
JFE announced today that it has issued its seventh medium‐term business plan running from FY2021 throughFY2024, signaling the beginning of the most transformative period in the company’s history. Through the plan, JFE
aims to rise to a new level by taking bold steps to establish a foundation for sustained, long‐term growth. In
particular, the plan is designed to enable JFE to overcome rapid and extensive change in social and economic
conditions surrounding the company, including a difficult and unprecedented operating environment
characterized by intensifying global competition amid the ascendency of China, increasing economic uncertainty
and geopolitical risk due to U.S.–China conflict, needs to address climate change, such as carbon neutrality, theemergence of innovative new digital technologies, and the spread of COVID‐19.
I. JFE’s mission
The long‐term goal of JFE is to provide products and services that support the development of a prosperous global
future, which reflects JFE’s corporate vision of contributing to society with the world’s most innovativetechnology.
At the core of JFE’s business is steel, a basic material that is indispensable to modern‐day civilization. But thestrengths of JFE go beyond that, encompassing an engineering business born out of steel operations that makes
life safer and more convenient for society, and also a global trading business that helps to deliver the diverse
value of JFE’s many operations to all corners of the world. JFE generates value by making maximal use of businessresources accumulated over many years, including technology, people, financial and intellectual capital, andnetworks.
JFE’s mission is to be essential to society’s sustainable development and to create safe, comfortable lives forpeople everywhere, and to become a company that is widely recognized throughout the world. Ensuring
environmental & social sustainability (helping to solve critical issues) and establishing economic sustainability(stable earnings power) will be crucial to making this happen. This will ensure the resiliency of JFE’s operationalfoundations and allow the company to achieve sustainable growth and increased value over the medium to longterm. Through these efforts, JFE employees will develop a stronger sense of mission and responsibility about thecompany’s contributions to sustainable development, motivating them to approach their work with a greater
sense of purpose and satisfaction.
II. Medium‐ & long‐term strategies under new plan
1. Achieve environmental & social sustainability
A. JFE Group Environmental Vision for 2050
Having positioned climate change as a top‐priority business issue, we formulated the JFE Group Environmental
Vision for 2050 and are now vigorously pursuing efforts to achieve carbon neutrality by 2050.
 Climate change is an extremely important business concern for JFE, based on which the company aims tobecome carbon neutral by 2050.
 The company will accelerate R&D in new technologies and strive to create super‐innovative technologies.
 JFE also will contribute to the reduction of CO2 emissions in society and use this as a business opportunity
to increase corporate value.
 Under the TCFD philosophy, JFE will work systematically to combat climate change
11) Key environmental initiative Reduce steel‐business CO2 emissions by 18% vs. FY2013 by the end of FY2024 (adjust FY2030 targets
based on progress in technology development under the medium‐term plan)2) Carbon neutrality by 2050
a. Reduce CO2 emissions at JFE Steel Pursue super‐innovative technology for carbon‐recycling blast furnaces and CCU (see Exhibit).
 Develop hydrogen‐based ironmaking (direct reduction) technology.
 Leverage top‐in‐class electric arc furnace technology for high‐grade steel manufacturing, highefficiency, etc.
 Develop transitional technologies for carbon neutrality, including ferro coke, increased use of steel
scrap in converters, energy savings and low‐carbon energy transformations.
b. Expand contributions to CO2 emissions reduction in society Engineering business: Expand and develop renewable‐energy power generation and carbon‐recycling
technologies.
 Reduce CO2 emissions by 12 million tons in FY2024 & and 25 million tons in FY2030.
 Steel business: Develop and market eco‐products and eco‐solutions.
 Trading business: Increase trading in biomass fuels, steel scrap, etc. and strengthen business in supply
chain management (SCM) for eco products.
c. Accelerate groupwide commercialization of offshore wind‐power business Engineering business: Manufacture and market monopile and other seabed‐fixed structures foroffshore wind‐power generation.
 Steel business: Use new continuous casting machine in Kurashiki to produce large heavy plates.
 Trading business: Carry out SCM for steel materials and processed products.
 Shipbuilding business:* Manufacture power‐generation floating structures and construct work vessels.
 Groupwide: Operation and maintenance (O&M) making maximum use of group resources* Japan Marine United Corporation (equity method affiliate)

The task of developing processes to mass produce high‐performance steel with zero CO2 emissions isessential for a sustainable world. Huge R&D and equipment replacement costs will be inevitable as JFE
executes strategies targeting carbon neutrality. Society must decide how these costs should be shouldered,including with the support of government and other forms of support. Working toward the lofty goal ofcarbon neutrality by 2050, JFE aims to establish the necessary decarbonization technologies as soon as
possible, ahead of global competitors, with the underlying goal to develop decarbonization infrastructure
and achieve equal footing on a global basis.
B. Solve issues impacting society1) Safety/health management
We take seriously the fact that we have not been able to achieve our top‐priority goal of zero major
accidents. Accordingly, we will further increase efforts to prevent accidents by installing facilities.
 Invest around 10 billion yen per year groupwide to address safety issues.
 Implement multifaceted health/safety management using advanced IT (monitoring, detection, etc.).
2) Facilitate employee participation Workstyle reforms
As business becomes increasingly globalized and complex, it is vital that we attract people who canenhance our competitive advantages and execute our growth strategies. Create workplaces and internal
structures to maximize employees potential and enable them to work safely and confidently. We willaddress the following three points:
 Diversity & inclusion (maximize capabilities of employees with diverse backgrounds) Personnel development (improve individual abilities and develop skills for global competence)2

 Workstyle reforms (create workplaces where employees can work safely and confidently.
3) Contribute to regional societies through engineering
JFE Engineering helps to build independent, decentralized, recycling‐oriented societies throughbusinesses for renewable‐energy power generation, regional PPS,* utility services such as gas and watersupply & sewerage, food recycling, and waste‐power generation.
*Power producers and suppliers engaged in local production of energy for local consumption

4) Respect human rights throughout supply chain
As we believe we must respect human rights not only within our own group, we will conduct human‐rights due diligence across our entire global supply chain from FY2021 and continue to expand our
support in this field.
C. Enhance corporate governance
So far we have formulated a Basic Policy on Corporate Governance, established a directors nominationcommittee and remuneration committee, introduced stock‐based compensation for directors, revised thestructure of our board of directors and audit & supervisory board based on evaluations of effectiveness, andtaken other steps to enhance governance. During this medium‐term plan, we will set performance targets
for non‐financial metrics related to environmental, etc. issues and consider how to apply these in terms of
director compensation and investment decisions. We will further strengthen our groupwide cross‐sectionalrisk‐management system to appropriately deal with diverse risks in our business environment as well as
further strengthen group governance.
2. Establish economic sustainability (stable earnings power)
A. Shift focus of domestic steel business from quantity to quality—Pursue world‐class earnings power
The steel market in Japan is the most important market for us, but we must assume it will shrink as Japan’s
population declines. Nevertheless, intensifying price competition for commodity products and theincreasing trend of local production of steel for local use suggest that efforts to grow export volumes are
not likely to be profitable. Therefore, we must fully shift production in Japan toward profitability based on
quality rather than quantity. The new medium‐term plan targets per‐ton profit of steel materials.
1) Achieve world‐class cost and quality competitiveness By successfully completing structural reforms in the steel business and thereby greatly reducing fixed
costs and lowering our breakeven points, we will establish a profit base that is resilient to changes in
economic conditions, ultimately to achieve world‐class cost competitiveness.
 We will introduce new technologies through digital transformation (DX) to improve production
efficiency and yields and also to greatly increase labor productivity. Large cost reductions (approx. 120
billion yen) will be pursued through investment in equipment modernization and rationalization. We
will also strive to ensure competitiveness by improving quality and delivering increased customer
satisfaction.
2) Expand margins and achieve stable profit
 We will enhance our product mix by focusing resources on strategic products. For improved profits,
we will increase our mix of highly value‐added products* to an unprecedented 50%, drawing on
advanced technologies that underpin our competitive strength.
 We will ensure that products offering the type of high value that customers seek are suitably
recognized in the market, based on which we aim to fully overhaul our sales pricing.
*Products that offer technological advantages, are recognized by customers for their value added, and have greater
earnings power than commodity products.

B. Growth strategies
1) Production & sales JV with India’s JSW for (gain‐oriented) electromagnetic steel sheets (steel
3business)
To expand earnings, we will further deepen our direct participation in global markets. In India, thedemand for (gain‐oriented)l electromagnetic steel sheets used in transformers is expected to grow inparallel with significantly increasing demand for electric power. To leverage our advanced technology,
JFE will partner with JSW to study the possible establishment of a joint‐venture company to
manufacture and sell (gain‐oriented) electromagnetic steel sheets in India. The feasibility study will
finish within fiscal 2021.
2) Expand solution business (steel business)
In the steel business, we will build a platform to provide technologies, operations and researchknowhow for manufacturing highly value‐added products and reducing environmental impact. By
developing a solutions‐based business model, we aim to triple earnings in this field in fiscal 2024
compared to fiscal 2020.
3) Expand sales revenue to 1‐trillion‐yen level in FY2030 (engineering business)
In view of the increasing importance of the environmental, recycling and renewable‐energy fields, we
aim to expand our engineering business as a growth sector by helping to solve pressing issues in global
society. The goal is to double current sales revenue to the 1‐trillion‐yen level by fiscal 2030 throughexpansion of operational businesses and also M&As and business alliances.
4) Expand SCM for overseas processing of electromagnetic steel sheets (trading business)
In the trading business, we intend to create the world's No. 1 global distribution and processing system
by making full use of the global network. This will include leveraging synergies with the steel business to
expand SCM for the overseas processing of high‐function electromagnetic steel sheets, which is one of
our strengths.
C. Significantly enhance competitiveness through DX
1) Advance productivity through innovation
The intangible assets we have amassed over many years, including vast stores of data and knowhow, are
key sources of our steel business’s competitive advantage. We intend to use such assets to innovatively
optimize all operations for enhanced productivity. This will include deploying leading‐edge digitaltechnologies such as cyber‐physical systems (CPS)* in all steel‐manufacturing processes and building aplatform that does not require specialized knowledge to analyze plant‐operation data.
*Systems that generate value by collecting huge amounts of sensor‐based data about physical equipment andproducts, analyzing it in cyberspace, and feeding the results back into the physical environment in real time.

2) Transform existing businesses
We will enhance products and services and strengthen relationships with customers. The strategies are
to improve supply chain efficiency among group companies, digitize accumulated plant‐operation data,etc., and utilize digital‐twin technology optimized in virtual spaces for everything from design tooperations.
3) Create new businesses
We will create new business models by expanding our solutions businesses that provide operational
technologies and knowhow, and by developing new value, markets and customers in fields such as
disaster‐resilience and environmental‐protection through digital services.
Our expanding deployment of DX will require us to address cybersecurity risks. To prevent cyberattacks andthe unauthorized use of our systems as well as to protect our information assets and ensure we conductbusiness in a safe manner, we will strengthen our security measures and governance led by our JFE Security
Integration and Response Team (JFE‐SIRT).
D. Balance financial soundness with effective investment based on a “select and concentrate” approach4In the steel business, from the beginning of our business integration we were among the first to reduce
fixed costs by consolidating and shutting down production facilities. In March 2020 we fixed plans forstructural reforms to reduce our annual crude steel production capacity in Japan by approximately 4 million
tons. This is expected to have the effect of reducing annual costs by approximately 60 billion yen in fiscal
2024 and lowering needs for renewal investment by approximately 200 billion yen over 10 years. Under
the plan, investments to maintain functions will be carefully selected from the perspectives of effectivenessand necessity. The emphasis will be shifted to investments for improved profitability, cutting‐edge facilities,
green transformation (GX) and DX.
Furthermore, we will reduce our assets by 200 billion yen, particularly those assets and businesses that
contribute little to earnings or are tied to unprofitable businesses, to strengthen our investment
effectiveness and financial stability. Also, to reduce the volatility of earnings that are susceptible to changes
in economic conditions, we will establish a more stable profit base by expanding our solutions business forsteel and operational business for engineering projects.
Investment and asset‐downsizing plans (consolidated basis, 4‐year horizon)
Seventh medium‐termNotesbusiness plan
Equipment
About 1,200 billion yen
Investment
Consolidated
Business
Investment
About 250 billion yen
Investment
Steel business: 1,080 billion yen
Total
About 1,450 billion yen
Steel business maintenance: About 30%
Steel business: 160 billion yen
GX Investment
About 340 billion yen Engineering business: 130 billion yen(Of above)
Trading business: 50 billion yen
DX Investment
About 120 billion yen
Asset Downsizing
About 200 billion yen
Non‐consolidated Crude Steel
About 26 million tons
Production (FY2024)
Steel Business Cost Reduction
120 billion yen
We are also working with Kawasaki city and other government authorities to consider how to repurpose
various sites in the Keihin District of our East Japan Works after our restructuring. We are looking at options
for land sales, leasing and business uses to maximize economic efficiency and land‐use conversion in waysthat contribute to sustainable development in local communities. Large‐scale land‐repurposing initiatives
will begin in the Minamiwatarida area and after we disclose our development plans for the Ogishima area
in FY2023, we will strive to see some properties put to new use by FY2030.
Performance & profitability targets and dividend policy
We have set the following performance and profitability targets for the plan’s final year in FY2024: ROE of
10%, consolidated business profit of 320 billion yen and profit attributable to owners of the parent of 220
billion yen. We will execute a range of measures to ensure achievement of these goals. Regarding returns
to shareholders, our policy is to aim for a dividend payout ratio of around 30%.

Consolidated

7th Medium‐term Plan targets

FY2020 actual

320 billion yen‐12.9 billion yen

220 billion yen‐21.8 billion yen

10%

‐1.3%

Debt/EBITDA ratio

About 3x8.1x

D/E ratio1

About 70%93%

Consolidated business profit
Profit attributable to owners of
the parent
ROE

5

Operatingcompanies

Steel business• Profit per ton2
• Segment profit
Engineering business• Segment profit• Revenue
Trading business• Segment profit

10,000 yen/ton
230 billion yen‐3,000 yen/ton(‐65.4 billion yen)

35 billion yen
650 billion yen

24 billion yen
485.7 billion yen

40 billion yen

20 billion yen

1 For liabilities with equity subject to credit ratings, these equities reflect the evaluations of rating agencies.
2 Steel business profit per ton (consolidated segment profit ÷ nonconsolidated sales volume)

III. Basic policies & measures for operating companies
1. Steel business (JFE Steel) Capital investment, business financing & investment: 1,080 billion yen over 4 years (40% for strategic
investment & 30% for maintenance investment.
 FY2024 unconsolidated crude steel production capacity: Around 26 million tons
 FY2024 segment profit target: 10,000 yen/ton; 230 billion yen (based on unconsolidated sales volume intons)
A. Transition to a lean, robust business structure by shifting focus from quantity to quality‐ Implement structural reforms and product‐mix enhancements focused on selectively concentrating
resources in priority fields.
‐ Secure customer recognition of our product value and then suitably rebuild pricing structure to expand
margins.
‐ Reduce costs by using DX initiatives to increase labor productivity, improve yields, etc.
‐ Contribute to reduced CO2 emissions in society by increasing production capacity for Grain‐oriented
electrical steel sheet (49 billion yen investment) and heavy, extra‐thick steel plate for offshore wind‐
power applications, using new continuous‐casting equipment in Kurashiki, and stably producing high‐strength steel sheets for vehicles.
‐ Achieve world‐leading profit per ton based on solid execution of above measures.
 Cost reductions: 120 billion yen over 4 years
 Labor productivity: +20% (13% via structural reform + 1,670→2,000 tons/person/year via DX, etc.)
 Ratio of high value‐added products: Increase to 50%
B. Expand and accelerate overseas business via solutions based on knowledge, skills, and data
‐ Begin studying the feasibility of establishing a grain‐oriented Grain‐oriented electrical steel sheet
manufacturing company in India together with JSW.
‐ Actively capture expanding demand overseas by having JFE Steel participate in growth markets directly
as an “insider” (strengthen relationship with FHS Vietnam, etc.).
‐ Expand solution‐business earnings by leveraging valuable technological intangible assets.
 FY2024 solutions business profit: Triple FY2020 level
C. Use digital technology to strengthen production base and strategies for new growth‐ Use digital technology to streamline production operations and achieve huge improvements in laborproductivity, including by introducing cyber‐physical systems on all production lines.
‐ Utilize DX to raise customer satisfaction through quality enhancements and better delivery services.
‐ Build platforms for providing technology and knowhow to actively expand solutions business.
 DX investment: 115 billion yen over 4 years
D. Pursue innovation aimed at achieving carbon neutrality‐ Develop a range of super‐innovative technologies through a multi‐track approach. Accelerate R&D intechnologies for achieving carbon neutrality as early as possible and seek government and other support
6

for such undertakings.
‐ Initiate R&D for carbon‐recycling blast furnaces and CCU (proof‐of‐principle process by FY2027).
‐ Accelerate development of hydrogen‐based steelmaking technology, including expanded use of raw
material sources through collaboration with BHP and other overseas partnerships.
‐ Continue to develop technologies for manufacturing high‐grade steel using electric arc furnace method,high efficiency, economic rationality, and diversification of raw materials.
‐ Actively participate in Iron and Steel Federation of Japan’s long‐term vision for climate‐change
mitigation.
 CO2 reductions: 18% reduction vs. FY2013 by end‐FY2024
 GX investment: 160 billion yen over 4 years
2. Engineering business (JFE Engineering) Capital investment, business financing & investment: Around 220 billion yen over 4 years
 FY2024 revenue target: 650 billion yen
 FY2024 segment profit target: 35 billion yen
A. Medium/long‐term priority areas
Waste to resources‐ In domestic environmental business, establish a profit base through M&A deals and DX initiatives toincrease productivity and enhance product strengths.
‐ In recycling business, make priority investments, including M&A deals, focusing on food, plastics andincineration & power generation.
 FY2024 revenue target: 290 billion yen
Carbon‐neutral business‐ Study prospects for manufacturing and supplying monopile and other seabed‐fixed structures foroffshore wind‐power generation.
‐ Actively pursue engineering, procurement and construction (EPC) projects in areas including biomass,solar power and geothermal power.
‐ Contribute to carbon neutrality through application of practical technologies and development of newenergy solutions, such as hydrogen energy.
 FY2024 revenue target: 80 billion yen
Combined utility services‐ Shift to a comprehensive business model, including for efficient operation of facilities, to contribute toenergy savings and decarbonization.
‐ Expand footprint of these businesses to contribute to independent, decentralized regional societies.
 FY2024 revenue target: 20 billion yen
Core infrastructure‐ Continue to use new materials, new construction methods and technologies such as construction robots
to address newly arising needs.
 FY2024 revenue target: 260 billion yen
B. Overseas business expansion‐ Enhance EPC competitiveness, engage in bridge construction projects under official development
assistance (ODA), and pursue M&A synergies in chemical‐plant field.
‐ In the environmental, water and recycling fields, deploy technology and knowhow to actively participate
in projects with local partners.
 FY2024 revenue target: 100 billion yen (included in (1))
C. DX initiatives‐ Digitize entire business and provide new digital services to customers.
7

‐ Increase design efficiency by building next‐generation solutions for EPC and operation & maintenanceutilizing digital‐twin technology. Also generate new businesses through digital services.
 FY2024 design efficiency: 20% increase
3. Trading business (JFE Shoji)
 Capital investment, business financing & investment: Around 120 billion yen over 4 years
 FY2024 segment profit target: 40 billion yen
A. Key strategies for growthEstablish No. 1 position in global processing & distribution of Grain‐oriented electrical steel sheet‐ Establish SCM operations, enhance processing functions and expand collaboration with alliance partners
in new regions.
‐ Establish world‐leading operations for Grain‐oriented electrical steel sheet processing & distribution.
Strengthen SCM for automotive steel composite materials‐ Deepen JFE’s cooperative ties across four key regions: Japan, China, Americas and ASEAN.
‐ Expand sales of strategic products and strengthen business in automotive steel composite material.
Accelerate efforts in overseas construction materials business‐ In ASEAN and North American regions, expand trading in this sector and collaborate with local
companies to strengthen business foundations.
Fully capture steel demand in Japan‐ Continue to strengthen SCM beyond group boundaries and expand capabilities including secondary andtertiary processing to build strong foundations.
‐ Expand business volume of new transactions to strengthen JFE’s market presence.
B. Strengthen purchasing and sales capabilities (expand non‐JFE Steel business)
Expand business domains in steel, raw materials, and materials & equipment‐ Increase sales of both JFE group products and alliance‐partner products as well as actively expand
business with other suppliers’ products.
C. Seize new business opportunities
Expand environmental‐solutions business‐ Build SCM operations for steel and processed products targeted at offshore wind‐power generation andgrow biomass‐fuel business.
DX initiatives‐ Implement digital technologies in SCM operations to improve customer service.
‐ Pursue new businesses by leveraging DX.
‐ Expand rollout of robotic process automation (RPA), expand AI deployment, and adopt new workstyles
and internal systems suited to digitization.
###
For further information, please contact:
Public Relations Section, Investor Relations and Corporate Communications Department
JFE Holdings, Inc.
Tel: +81‐3‐3597‐3842
This document is not a disclosure document under the Financial Instruments and Exchange Act, and we do not guarantee the accuracy or completenessof the information contained herein. In addition, the forecasts, etc. presented are based on information available at the time of the official
8 making investment decisions based solely on this material. The Company
announcement and include uncertainties. Therefore, please refrain fromassumes no responsibility whatsoever for any damages resulting from the use of this material.

Exhibit
Carbon‐recycling Blast Furnaces and CCU
JFE Steel will continue to study the combination of carbon‐recycling blast furnaces and carbon dioxide capture andutilization (CCU) to reuse and thereby significantly reduce CO2 generated in blast furnaces.
Main Features
 JFE Steel's proprietary carbon‐recycling blast furnace technology turns CO2 in blast furnace exhaust gas into methane(methanation), which can be blown back into the blast furnace as a reducing material.
 Recycling carbon leads to fewer CO2 emissions as well as reduced use of iron ore. In addition, raw materials of thesame grade as those used in current blast furnaces can be utilized.
 CCU combined with methanol synthesis also reduces CO2 emissions along with other reductions by methanation of
the blast furnace method.
 The technology can use existing blast‐furnace infrastructure to help facilitate the transition to carbon neutrality while
continuing to meet the enormous demands for regular and high‐quality steel for sustainable global development.
JFE Steel, which is committed to zero‐carbon steel production, aims to verify this CO2‐reduction effect for carbon‐
recycling blast furnaces and practically demonstrate the process by fiscal 2027.
Conceptual diagram of carbon recycling blast furnace9