NITTETSU MINING

Integrated Report2023

NITTETSU MINING

Supporting people and society
through mining development
Nittetsu Mining provides the world with a wide array of mineral resources from its numerous mines
in Japan and other countries.

Share of limestone
supply forsteelmaking in Japan:

40 +%Note: Nittetsu Mining survey

We own many limestone mines in Japan—including the largest, the Torigatayama Quarry Complex—
from which we sell limestone to domestic manufacturers of steel, cement, and other essential
products in addition to exporting to Australia, Taiwan, and other countries.

Our limestone and other important materials are used in many industries to create the things weneed to live.

Torigatayama Quarry Complex (limestone mine)

Japan’s leading supplier of limestone for steelmaking
Our involvement in mining development since our founding has given us the technology to seamlessly
handle all aspects of mining, from prospecting and assessment to excavation and ore processing. Byleveraging these technologies to ensure a stable supply of resources, we are building long-term trust withour business partners. In particular, we have long been Japan’s top supplier of limestone for steelmaking.

Robust technology to help
build a sustainable society
We are researching, developing, and engineering new products and materials toserve as the core of new businesses based on the wealth of mining development
technology and experience we have amassed over the years.

We harness the collective strengths of the Group in our business segments—

including machinery & environmental engineering centered on environmentallyfriendly products, real estate, and renewable energy—to help create a prosperous
Kagoshima Geothermal Facility (supplying geothermal steam)1

Integrated Report 2023

society in the future.

NITTETSU MINING

2

Management Policy

Contents

The Nittetsu Mining Group aims to contribute to
the creation of a prosperous society in the future andto be a company where each and every employee can workwith high motivation and pride.

Code of Conduct
Recognizing that a corporation is a member of society, the executives and employees of the Nittetsu Mining
Group establish this Code of Conduct that requires us to abide by all laws, engage in sensible corporate
activities, and contribute to our own sustainable development and the creation of a vibrant society.

1
2
3
4
5
6
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Integrated Report 2023

We provide high-quality, safe products and services to customers that meet the needs of the time.

As a member of society, we live up to the trust placed in us as we co-exist with local communities.

1 Introduction
3 Management Policy and Codeof Conduct
4 Table of Contents
5 Our Path to Becoming an Integrated
Mineral Resources Company
7 Message from the President
11 Nittetsu Mining’s Value
Creation Process
13 Medium-Term Management Plan
15 Overview of Business Segments
21 Special Feature 1: Mining
Development
23 Special Feature 2: Researchand Development

25 Sustainability at Nittetsu
Mining27 Environment
33 Social
37 Corporate Governance
49 Consolidated Financial
Indicators Through the Years
51 Consolidated Financial
Statements (Condensed)
53 Non-Financial Highlights
55 Corporate Profile and ShareInformation
56 Investor FAQ

Editorial Policy 
The Integrated Report 2023 (“this report”) is a collection of important information to help shareholders, investors, and otherstakeholders understand Nittetsu Mining in terms of our management policy, business strategies, and other financial aspects
as well as our ESG efforts and other non-financial aspects. We view this report as a vital tool for communicating withstakeholders, and we intend to enhance it further in the future.

Timeframe 
In principle, this report covers the period from April 1, 2022 to March 31, 2023; however, for overseas consolidated

subsidiaries, this report covers the period from January 1, 2022 to December 31, 2022. Please note that this report includes
some content from outside these periods.

Scope Executives and employees create a bright, safe workplace that empowers self-realization andwhere work is done in good faith and in compliance with all laws and regulations.

In general, this report focuses on Nittetsu Mining Co., Ltd. and the Nittetsu Mining Group.

We fulfill the trust and expectations of society by appropriately disclosing information as needed
to shareholders and investors.

November 2023

Publication Date Note about Forward-Looking Statements 

We consider environmental conservation by effectively utilizing resources and by promoting
recycling.

The forecasts and projections of future performance and other forward-looking statements contained in this report are
judged to be reasonable by us based on information currently available to us. Actual results may differ from the forecasts andprojections presented here due to changes in various factors.

We take a resolute stance against antisocial forces and have no relationships with them.

The products that appear in this report—Polytetsu, Sinter Lamellar Filter, and PLASMA DASH—are trademarks of Nittetsu
Mining Co., Ltd.

NITTETSU MINING

4

Our Path to Becoming an Integrated Mineral Resources Company
Origins of Nittetsu Mining

1899
Nittetsu Mining traces its origins to
the Futase Mine established toserve as the Raw Materials
Department for procuring coke andgeneral fuels for the state-owned
Yahata Steel Works, Japan’s first
integrated steel manufacturer.

1989

1991

Established the Real
Estate Division

Started operations at the El Roble
Copper Mine (Colombia) (sold to a
Colombian corporation in June 1998)

Released inorganic ironflocculant Polytetsu as a productunder management of theMachinery Sales Department

Released SinterLamellar Filter

1973

1993
Established Nittetsu Mining Chile Ltd.
(currently a consolidated subsidiary)for copper mining development in the
Republic of Chile

Established the Chemical
Products Sales Division(changed name toEnvironmental Sales
Department in April 1993
and integrated a portion of
the business into theMineral Resources Division)

2008
Withdrew from securities
in light of flagging
performance andsynergy with the mineral
resources business

2006

Released PLASMA DASH
smoke separators

2003
Started trial operations at Atacama
Copper Mine (Chile) (transitioned tofull-scale operations in June 2003)

Established the Machinery
Sales Department

1972

1939

Launched solar power generation business when we started
selling electricity from the Toyako Mega Solar Power Plant.
Established the Renewable Energy Department to promotenatural energy development.

1985

Started operations at the Qaleh-Zari
Copper Mine in Iran (sold to anational Iranian copper industries
company in December 1991)

Japan Iron & Steel Co., Ltd. wasestablished with funds from thestate-owned Yahata Steel Works andfour other private-sector companies,
and took over the Futase Mine.

2013

With NIPPON STEEL CORPORATION, co-financed theestablishment of Nittetsu Kagoshima Geothermal Co.,
Ltd. (absorbed into Nittetsu Mining in April 2013)

1979

1975

1934

1990

Withdrew from coal production with theclosing of the Ioujima Quarry Complex

Nittetsu Mining was established separately from Japan Iron &Steel Co., Ltd. to develop and secure coal, iron ore, limestone,
and other raw materials for steelmaking. Nittetsu Mining took
over mines in Japan, including the Futase Mine (coal) and theKamaishi, Kucchan, and Akatani mines (iron ore).

1971
Established the
Torigatayama
Quarry Complex

1968
Entered the copper smelting businessby co-financing the establishment of
Hibi Kyodo Smelting Co., Ltd. with
MITSUI MINING & SMELTING CO., LTD.

1951

1956

Entered the securities business by participatingin the management of Kanto Securities Co., Ltd.

Expanded into the machinery business byinvesting in Kobukuro Kosakusho Co., Ltd.,a manufacturer of coal mining machinery

1939

1942

1945

1948

1951

1954

1957

1960

1963

1966

1969

1972

1975

1978

1981

1984

1987

1990

1993

1996

1999

2002

2005

2008

2011

2014

2017

2022

Note: The bars on the graph represent non-consolidated net sales through 1976 and consolidated net sales in and after 1977

Nixon ShockWorld eventsFirst Oil Crisis

Second Oil Crisis

Plaza Accord

Collapse ofJapan’s bubble
economySeptember 11 attacks
in the USA

Great East Japan
Earthquake

Collapse of
Lehman Brothers

COVID-19
pandemic

Nonmetallic minerals
Metallic minerals
Coal

Machinery & environmental engineering

Nittetsu Mining’s business segments

Real estate
Renewable energy
Securities

5

Integrated Report 2023

NITTETSU MINING

6

Message from the President

resources. We will continue to further refine our own
mining technologies and harness the collective
strengths of the Group to achieve sustainable growththat bears the hallmarks of the Group.
I feel that the corporate culture we have cultivatedover our long history is also distinct to our Group, which
has grown primarily through the mining business. In themining business, development to production and finallyclosure take place over extended time spans. The
corporate culture that spontaneously develops in such

Refining our mining technology
and harnessing the collective

Working toward achieving the Long-Term Vision

strengths of the Group(progress and outlook of the Medium-Term Management Plan)

Reiichi Morikawa
Representative Director and President

Striving to achieve sustainable growth as anintegrated mineral resources company

The Long-Term Vision of the Nittetsu Mining Group
sets out the goals of contributing to society throughthe development and stable supply of mineral
resources, and harnessing the collective strengths of
the Group as an integrated mineral resources company
to achieve sustainable growth. The Group traces its
history to 1939, when it was spun off from the company
now known as NIPPON STEEL CORPORATION tosecure raw materials for steelmaking—namely coal,iron ore, and limestone. In the 84 years since, we have

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Integrated Report 2023

a business is one of respect for connections between
employees and with local communities—in otherwords, a corporate culture with a long-term outlook anda penchant for cooperation. This corporate culture has
supported the development of the Group as anintegrated mineral resources company. To achievesustainable growth in the future, I believe that we must
maintain this corporate culture and that each and every
one of our employees must further enhance their
sensitivity and responsiveness to change.

worked with flexibility and determination to reform ourbusiness in response to sweeping changes in society.
Today, as an integrated mineral resources company,
the entire Group is united in facing the challenge ofdeveloping and providing a stable supply of mineral
resources. We use the term integrated mineral
resources company to refer to the Group in its present
state: engaged in a broad range of businesses thatleverage its mining technologies around the corebusiness of developing and producing underground

Under the Second Medium-Term Management Plan,
which started in FY2021, we are promoting manymeasures to achieve our Long-Term Vision based on
two basic policies: steadily executing large-scale
investments and acquiring resources for sustainablegrowth, and allocating management resources in
response to demand trends in Japan and overseas.
Two years have passed since the start of the plan,and I believe things are generally progressing as
expected. Net sales and operating profit for FY2022
significantly exceeded Medium-Term Management
Plan targets thanks to higher sales and profits in the
Metallic Minerals Division, a reflection of the impact ofhigher copper prices and the weaker Japanese yen. In
financing, our EBITDA exceeded the projection due tothe increase in operating profit, and interest-bearing
liabilities decreased in part because the Arqueros Minedevelopment work had not yet started. Although capital
investment was lower than expected due to theextension of the schedule for constructing the third
shaft at the Torigatayama Quarry Complex and the factthat the Arqueros Mine development work had not yet
started, we are steadily moving toward full-scale
operation during the next Medium-Term Management
Plan. As for shareholder returns, our policy is to return
profits to shareholders with a target consolidated
payout ratio of 30%, and we were able to abide by thispolicy in FY2021 (30%) and FY2022 (30.2%).
Regarding our Shareholder Return Policy looking
ahead, the Board of Directors held discussions with theaim of conducting management that is conscious ofshareholder equity and share price and reached aconsensus that the policy should be enhanced,

eventually deciding to set a target consolidated payout
ratio of 40% and enhance shareholder returns by
establishing a minimum dividend based on the dividendon equity (DOE) ratio to clearly state our policy forstable dividends over the long term. Although theSecond Medium-Term Management Plan is still active,
the Board believes that improving our corporate value
requires a sense of urgency; thus, we will implement
this policy starting in FY2023.
Next, I will discuss our progress on the threelarge-scale investments set out in the Medium-Term
Management Plan.
First, we plan to construct a third shaft at the
Torigatayama Quarry Complex—our main limestonemine—to provide a stable supply of mineral resources
over the long term. The schedule has been extendedroughly one year from the original plan due totyphoons, measures to prevent leakage in the shaft,and the like, and we are proceeding with the work withthe aim of full-scale operation in FY2024. For thedevelopment of the new mining area at the Hachinohe
Mine, river rerouting and other work is being launched
in FY2023 with an eye toward full-scale extraction
during the next medium-term management plan period.
At the Arqueros Mine, organizational decisions on its
development were delayed because it took longer than
expected to acquire environmental license due to thetemporary suspension of the environmental authorities’
review because of the COVID-19 pandemic. However,in April 2023, the Board of Directors examined theeconomic rationale for the project and decided totransition to the development phase. In response, wehave begun development work with our sights set on

NITTETSU MINING

8

Message from the President

launching operations in 2026.
Regarding the development of copper mines, the firstpriority is to successfully launch operations at theArqueros Mine, where we have begun development.
Beyond that, there is an urgent need to find new
development projects to follow those at the ATACAMAKOZAN Mine and the Arqueros Mine. This is why weestablished the Overseas Mineral Resources Business
Department in July 2022 as a department dedicated tostrengthening the management systems and technicalsupport for our locations in Chile as well as developing
and promoting new development projects. The
department has assembled an elite team of mining
development specialists to explore various possibilities
to achieve the long-term goal of producing at least
50,000 tons of copper concentrate (copper equivalent)
per year in the Republic of Chile.
Our survey work is ongoing not only in Chile, but also
in other parts of South America and in Southeast Asia.
In June 2023, we signed an agreement to participate in
the exploration works for the Los Chapitos Copper
Project in Peru. Although still in the exploration stage, if
the project moves forward in the future, we will be able
to acquire a 35% interest and obtain offtake rights topurchase 50% of the copper produced. The Overseas
Mineral Resources Business Department plays animportant role in this as well.
For FY2023, the final year of the current
Medium-Term Management Plan, we anticipate asomewhat challenging business environment.
Specifically, we have factored in increases in energy
and other costs as well as muted assumptions forcopper prices and exchange rates. Although we expect
to see an increase in profits for the Group as a whole
compared to the Medium-Term Management Plan, we
expect a decrease in profits compared to FY2022. The
situation is unpredictable due to numerous
uncertainties, among them the crisis in Ukraine andother escalating geopolitical risks, the impact ofinterest rate hikes in Europe and the US on the global
economy, and the economic slowdown in China.
Although limestone and copper—the Group’s main
products—are relatively sensitive to external factors,
they are indispensable natural resources for improving
infrastructure and other aspects of everyday life. It is
the Group’s mission to provide a stable supply of thesemineral resources. To continue to provide a stablesupply of these essential resources andenvironmentally friendly products, we will strive tofurther solidify our business foundation by enhancing
our earning capacity mainly by reflecting increasing
costs in our prices and expanding sales to overseas
markets.

Strengthening sustainability management
In the mining industry, our continued ability tooperate is closely tied to co-existence andco-prosperity with local communities and the naturalenvironment. Management must be aware of the needto achieve sustainability in society. In April 2022, theGroup established a Sustainability Committee chairedby the President with the aim of promoting
sustainability initiatives and further enhancing
corporate value over the medium and long term. We

9Integrated Report 2023

have also worked to establish a system for promoting
sustainability management; for example, in June 2022,
we made organizational decisions on our Basic Policy
on Sustainability and identifying material issues to beaddressed in order to realize the policy.
We have established themes for materiality in each ofseven areas: responding to climate change, promoting
environmental conservation activities, providing astable supply of raw materials and products, industrial
safety and health, co-existence and co-prosperity withlocal communities, respecting human rights anddiversity and developing human resources, andstrengthening governance. As part of our response to
climate change, the Group recognizes the need toundertake proactive efforts and is accelerating the shift
to renewable energy for its electricity consumption. To
promote industrial safety and health, we are working toposition safety as a top management priority, and also
revised several systems in April 2023 in an effort tocreate work environments where more flexible work
styles are made available to employees. To ensure thathuman rights and diversity are respected and develop
human resources, we aim to bring out the best of ouremployees’ abilities by creating work environments

where they can actively exchange opinions without
concern for hierarchy. Toward this end, we upgraded
the Personnel Section, which was previously locatedwithin the General Administration Department, to the
Human Resources Department in April 2023 andformulated a Human Resources Development Policy
the following month. Going forward, we will strive tomaximize the value of our human resources throughefforts such as promoting diversity and fostering
inclusive work environments.
With the goal of strengthening governance, wetransitioned to a company with an Audit andSupervisory Committee in June 2023 to further
strengthen the supervisory functions of the Board of

Directors and make management decisions withgreater speed. We also introduced a share-based
remuneration system for internal Directors (excluding
those who are members of the Audit and Supervisory
Committee) to align them with shareholders byaugmenting their focus on improving corporate value
and medium- and long-term growth and improving
corporate value. We will continue striving to further
strengthen our governance through efforts to establish
organizations capable of responding to changes in thebusiness environment and management systems toequip the Company to execute decisions with theutmost fairness and transparency.

Harnessing our collective strengths to achievesustainable growth and enhance corporate value
Around the world, uncertainty is mounting and thepace of change faster than ever before and still
accelerating. The movement toward decarbonization,
efforts toward digital transformation, the rapid
evolution and use of generative AI, and otherdevelopments are transforming the very social systems
in which they are occurring. To flexibly adapt to thesechanges, we will continue to devote energy to refining
our mining technologies and harnessing the collective
strengths of the Group under our management policyof contributing to the creation of a prosperous society
in the future and aiming to be a company where eachand every employee can work with high motivation andpride.
We look forward to working earnestly with ourcustomers, business partners, local communities,
shareholders, investors, and other stakeholders as wemove forward in our efforts to achieve sustainablegrowth and enhance corporate value.

NITTETSU MINING

10

Nittetsu Mining’s Value Creation Process
Nittetsu Mining’s businesses / Integrated mineral resources company
Societal issues

Mine life cycle

Society-wide sustainability

Closure & management of former mines

Impact on society

Mineral Resources
Distinct technology for all stagesof mining development

Financial capital

Exploration

MiningBeneficiation

Creating new businesses

Consolidated net
139,410 million yen
assets Interest-bearing
22,858 million yen
liabilities 

OutputTotal limestone production

Manufacturing capitalBusiness locations 
Works/quarries Laboratories Affiliate companies 

7
5
1
23
and moreIntellectual capital

Research &Development

Research and development
823 million yen
expenses 
42
Number of patents owned 

Human capital

Number of employees(consolidated) 

2,127Social/relationship capital

Trust-based relationships with clients
Co-existence and co-prosperity withlocal communities

Natural capital
Operating mines 

Limestone mines in Japan, crushing,copper mines overseas

13

Total area of mining areas  259 km
Prospecting and mining rights in Japan

Former mines

Acquiring forest certification for properties,
repurposing properties for new business

11

Integrated Report 2023

2

• Creating industrial infrastructure• Stable supply of materials forinfrastructure• Local development/employment
opportunities• Helping resolve environmental andsocietal issues• Promoting carbon neutrality

Machinery &Environmental
Engineering

23,231,000 tons

Total crushed stone production

Renewable
Real Estate
EnergyWater treatment/dustcollection technology

2,811,000 tons

Total calcium carbonate production

437,000 tons

Natural energy(e.g. geothermal,hydropower)

Medium-Term Management Plan
Corporate governance
Sustainability management

Utilizing idle
company-owned
land

Total copper concentrate production

48,000 tons

Total sales of Polytetsu

Our vision as an integrated mineral
resources company

Management resources

Production & operation

Achieve sustainable growth by contributing to society throughthe development and stable supply of mineral resources and byharnessing the collective strengths of the Group.

• Climate change, pollution• Economic stratification, regional
inequalities• Demographic challenges (Japan:
Low birthrate, aging population)• Racial/social discrimination• Forced labor, child labor, industrial accidents

Studies & development

Contributing to thecreation of aprosperous society
in the future

217,000 tons
(Group wide)

NITTETSU MINING

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Medium-Term Management Plan (FY2021–FY2023)
Long-Term Vision

Financial Indicators and Medium- to Long-Term Management Goals

Achieve sustainable growth by contributing to society through thedevelopment and stable supply of mineral resources and by harnessing thecollective strengths of the Group as an integrated mineral resources company.

● We will improve our ROA (return on assets) in order to improve operating profit through the efficient
operation of total capital.
● We will maintain a stable capital adequacy ratio.
Investment recovery and next
Temporary decline due toFY2020 result

Operating margin
Total capital turnover
ROA (operating profit)

First Medium-Term
Management Plan
Strengthen management
infrastructure

Second Medium-Term
Management Plan

Execute large-scale
investments

We will steadily implement large-scale investments, aiming toacquire resources for sustainable growth.
We will allocate management resources in response to demand
trends in Japan and overseas.

The current medium-term management plan period
is a time for full-fledged implementation of large-scale
investments with an eye to future growth. The third
shaft at the Torigatayama Quarry Complex (limestone)
is under construction with the aim of beginning
full-scale operation in FY2024. We will proceed with
development at the Arqueros Copper Mine and the newmining area at the Hachinohe Mine, which are alreadyunder development, aiming for full-scale operation in
the next medium-term management plan period.
Business activity

We recognize that it is important to respond flexibly
to demand trends in Japan and overseas, especially in
relation to structural reform at steel manufacturers,
which are major purchasers of limestone, while
securing profits that can handle such active
investments and maintaining financial soundness.
For this reason, we will work to identify growth areas
and develop demand in all our businesses, and strive tobalance our SDGs initiatives with our businessactivities.

Relevance

Contribute to the development of industrial infrastructure,regional development, and employment

Related SDGs

Development andoperation of limestone
mines, copper mines,etc.

• Cooperate with manufacturers to consider hybridization and electrification of heavy mining equipment

Water purification for sewage treatment and industry effluent

Renewable
EnergySupply steam togeothermal power station
Solar and small-scalehydropower generation

R&D
Department

Improve air quality through dust collection and deodorization
Pursue sustainability of renewable energy• Construction of our own geothermal power station
Future • Study and promote introduction of renewable energy for in-house power
initiatives generation and consumption throughout the Group

Develop new products andmaterials that will
Future • Research hydrogen recovery from hydrogen sulfide
contribute to existing and initiatives • Research CO₂ absorption and fixing in mineral products and waste*
new businesses

4.8%

8.1%

6.7%

60.7%

58.9%
(Assumptions)
FY2021 result
FY2022 result

63.5%• Exchange rate: ¥105 = US$1
• Exchange rate: ¥112.38 = US$1
• Exchange rate: ¥135.47 = US$1

119.1
8.7

FY2023 Plan

Medium- tolong-term goals

6% or more
0.7 or more

4% or more
57.5% or more

0.9 or more

7% or more
60% or more

• Copper price: 350 cents/pound• Copper price: 439.59 cents/pound• Copper price: 387.87 cents/pound

FY2021 result (plan)

FY2022 result (plan)

15.7 (9.4)

13.6 (9.0)

149.0 (128.4)

8% or more

164.0 (125.6)(Billions of yen)
FY2023 plan

123.8
7.3

Financial Plan and Capital Investment Plan
14.0
7.5
5.3

(Billions of yen)

FY2021 result (plan)

FY2022 result (plan)

FY2023 plan

11.0 (12.1)

8.5 (13.2)

17.3

21.1 (15.2)
5.4 (5.8)

19.1 (14.8)
5.4 (5.8)

15.4
8.1

Notes: 1. EBITDA: Operating profit + depreciation. 2. Capital investment: (FY2021 to FY2023) Including the stripping activity asset.

TOPICS

Reuse steel slag and copper slag, and increase procurement ofrecycled raw materials to Tamano Smelter

Production and sale ofwastewater treatment
Use of recycled materials and coagulation to save energy in factories
agents, dust collectors
and deodorizers

0.81

8.3%

investment preparation period

Our plan assumes net sales to hold steady for the most part. Regarding limestone, we plan to counteract the drop in sales because of the ongoing
consolidation of blast furnaces due to the restructuring of steelmakers—the main buyers of limestone—by expanding exports to Asia, Oceania, andother areas where economic growth is substantial. We also aim to expand exports of high-grade limestone from Torigatayama, which features loading
facilities compatible with large vessels. We expect copper sales to hold steady as well, but will increase sales once the new copper mine comes online
during the next Medium-Term Management Plan. Additionally, we are aiming to expand sales in machinery & environmental engineering (mainly
environmentally friendly products).

Depreciation• Micro power generation using water from mine shafts and solar power

Machinery &Environmental
Engineering

Operating profit

Capital investment

generation for offices and company-owned land
Futureinitiatives • Collaborate with local governments to use public water for small-scale hydropower generation(certification acquired in company-owned forest in Hokkaido)

0.77

10.5%

0.66

FY2020 result

Net sales

EBITDAIn-house generation of electricity by long distance conveyor belt (Torigatayama)

Greening and appropriate maintenance of former mine sites (usedeffectively in some real estate projects) and sedimentation sites
Forest certification system: Operate in accordance with SGEC

Numerical
TargetFY2022 result

FY2020 result

Operation of an environmental management system in accordancewith ISO 14001 (certification obtained for all limestone mines under direct control)
MineralResources

Capital adequacy ratio

7.3%

FY2021 result

full-fledged investment period

Carbon-neutral
society

Specific
initiatives toachieve carbon
neutrality

Change in Shareholder Return Policy

Based on the basic policy of paying stable dividends over the long term while maintaining an optimal balance between
equity capital adequacy and shareholder returns, starting in FY2023, we will pay dividends with a target consolidated
payout ratio of 40% (previously 30%). Additionally, with the aim of stable dividends over the long term, if the P/B ratio at*1
the end of a fiscal year is less than 1x, the lower limit of dividends is 3% of the market value DOE ; if it is 1x or greater, the*2lower limit is 3% of the DOE . As a result of this policy change, the annual dividend forecast for FY2023 is as follows.

Annual dividend forecast for FY2023
100 yen announced at the beginning of the year (30% consolidated payout ratio) → 132 yen (40% consolidated payout ratio)*3

Notes: 1. Market value DOE = Annual dividend per share ÷ Annual average share price (simple average of daily closing prices)
2. DOE = Annual dividend per share ÷ Consolidated net assets per share at fiscal year-end (excluding non-controlling interests)
3. As of August 25, 2023 publication date

* We are revising some future initiatives to better match present circumstances.

13

Integrated Report 2023

NITTETSU MINING

14

Mineral Resources

Overview of Business Segments

The Nonmetallic Minerals Division boasts the top level of limestone
production in Japan on the strength of our limestone mines throughout
the country, including the largest in Japan: the Torigatayama Quarry
Complex. The Metallic Minerals Division operates the Atacama Copper
Mine of the Republic of Chile in South America and smelts electrolytic
copper on consignment from Hibi Kyodo Smelting Co., Ltd.

Ever since our founding, we have been engaged in the entire process of providing a stable supply ofmineral resources, from securing long-lasting rights and interests in the earliest stages to studies,development, production, and operation. We use the technologies we have cultivated in the mining
business to develop diverse businesses as an integrated mineral resources company.
Overseas mining interests

ATACAMA KOZAN
Mine

60

123

%

Arqueros Mine

(development underway)

80%

With a majority interest, welead the development andoperation of overseas mines

yearsFounded in 1899
Established in 1939

Net sales

Capital adequacy
ratio

63.5
Torigatayama, Japan’slargest mine
Annual limestone production

12,925,000(FY2022 result)

tons

Largest production of any
limestone mine in Japan

Number of mines in operation
Japan

12
1
Overseas

Research &development
expenses820

million yen(FYE March 2023)

Cumulative production
since opening

600

Mine life

Roughly

15

Integrated Report 2023

100

years

Operating profit

12,582

million yen

1,257

million yen

1,707

million yen

547

million yen

The Environment Division supplies wastewater treatment agents,
with a special emphasis on our inorganic iron flocculant, Polytetsu.
The Machinery Division satisfies a broad range of needs with dust
collectors and other environmentally friendly products as well as
general industrial machinery.

Net sales

13,003

million yen

Operating profit

Real Estate

The Real Estate Division has carried out business activities toeffectively use company-owned real estate. The division manages officebuildings, condominiums, and other buildings on company-owned realestate in urban areas, and is developing leasing business to meet market
needs (e.g. restaurants, merchandise outlets, factories, storehouses,
parking areas) at former mine sites and on idle land throughout Japan.

Net sales

2,882

million yen

Operating profit

Renewable Energy

million t(As of March 31, 2023)

million yen

Machinery & Environmental Engineering%(FYE March 2023)

146,384

Number of employees (consolidated)

2,127(As of March 31, 2023)

Net sales (consolidated)

164.0

billion yen(FYE March 2023)

Efforts are underway in this segment to develop renewable energy in waysthat consider the global environment, for example using our prospecting
technology cultivated through mineral resource development to study anddevelop geothermal energy and supply and sell geothermal steam, generating
solar power at former mine sites and on other idle company-owned land, andsmall-scale hydropower generation using seepage water in tunnels.

Net sales

1,750

million yen

Operating profit

NITTETSU MINING

16

Overview of Business Segments

Mineral Resources

Nonmetallic Minerals Division Limestone, crushed stone, calcium carbonate, fuels, etc.
Limestone

Business strengths
Our Nonmetallic Minerals Division produces and sells high-quality limestone throughout Japan, including from
Torigatayama, a coastal quarry complex that is well situated for shipping via large vessels and boasts the largest
production volume in the country. With production locations dispersed throughout Japan, we are prepared for the riskof natural disasters and accidents, thereby fulfilling our mission of providing a stable supply of high-quality mineral
resources to meet society’s needs.
Our Metallic Minerals Division is actively leveraging mining and development technologies cultivated in domestic
mines in overseas exploration and resource development. In Chile, we operate the ATACAMA KOZAN Mine, in which
we hold a major interest (60%), and have begun a new development project to bring the Arqueros Mine (80% interest)
online.

Net sales (Millions of yen)

146,384

Operating profit (Millions of yen)
14,296133,124
106,888

12,5822019

2020

Limestone

9,660

28,883Copperconcentrate

20,175100,227 103,489
7,007

2018

Other

2021

2022

2018

(Fiscal year)

7,398

2019

Net sales by item

7,298

2020

(Millions of yen)

2021

2022

(Fiscal year)

Electrolytic
copper

57,112

Crushed
stone

6,714

Calciumcarbonate

Limestone is an essential primary and secondary mineral resource in the production of steel, cement, and other industrial
materials. It also has many other applications, including as an aggregate in civil engineering and construction, a desulfurizer at
power plants and waste treatment facilities, and a material in the process of manufacturing fertilizer, animal feed, glass, paper,
sugar, pharmaceuticals, food products, and more. Thus, limestone is present in every aspect of our daily lives.

Long-term
goal

Business strategy and outlook

Steelmakers in Japan—major buyers of limestone—areproceeding with efforts to streamline by consolidating blast
furnaces in Japan and to enhance their systems for producing
raw materials overseas in light of the projected decline indomestic demand and other countries’ moves toward
self-sufficiency in production. Accordingly, we anticipate ameasurable decrease in demand for limestone for steelmaking
in Japan. On the other hand, worldwide demand for limestone
for steel and other purposes is on the rise year after year asdeveloping economies grow substantially. Therefore, we

3,317

TOPICS

Fuels, etc.

Providing a stable supply with dispersed locations

20,521

Environmental efforts• Operating an environmental management system in the context of mining operations in accordance with ISO 14001• Noise and dust control during operations, greening of former mine sites and sedimentation sites, preventing
sediment discharge and river pollution• Considering using water from mine shafts to generate power as well as generating solar and wind power at our
offices and on company-owned land as a means of decarbonizing

Metallic Minerals Division Electrolytic copper, copper concentrate, etc.
Copper ore

Copper is a highly conductive material used in all electrified machines and infrastructure (e.g. power cables), and its
importance is on the rise amid the proliferation of electric vehicles and renewable energy on the path toward
society-wide carbon neutrality.

Long-term
goals

Laos (copper, tin)

Fiji (copper, gold)● Operating mine/development work underway● Major exploration projects

17Integrated Report 2023

• Produce at least 50,000 tons of copper concentrate (copper
equivalent) per year in the Republic of Chile• Achieve stable profits in our smelting businessBusiness strategy and outlook

Morocco (tin)Philippines (limestone)

intend to expand exports mainly to China, Taiwan, Australia,
and elsewhere in Asia and Oceania to capture the increasing
demand we expect in those places. Although ramping up
exports will require us to further strengthen our system forproviding a stable supply, we must also reevaluate operationalrisks and revise our backup systems at coastal locations inaddition to harnessing cutting-edge technology to streamline
production and improve economic efficiency. We are also
looking into mineral resource development in comprehensive
terms, for example to maintain and expand the Group’s
productivity and for BCP systems.

We own limestone and crushed stone production locations throughout Japan. Our four coastal quarry complexes—Shiriya Quarry Complex,
Hachinohe Mining Co., Ltd., Torigatayama Quarry Complex, and Oita Quarry Complex—have loading facilities for ships and function in tandemwith the Sodegaura Distribution Center, which houses our stockpile of limestone for aggregates and steel in the Kanto region. This combinationof locations gives us multiple options when production and shipments are delayed due to typhoons, heavy rain events, and other natural
disasters, contributing to our stable supply of mineral resources.

Overseas exploration and development projects

Cambodia (copper)•E xpand into the global market ahead of the projected decline indomestic demand

Peru (copper)

Chile (copper, gold, silver)
Copper mines in Chile

ATACAMA KOZAN Mine (operating)
Arqueros Mine (development underway)

Our Chilean subsidiary Atacama Kozan will extend its
reserves-to-production ratio by incorporating ore fromsurrounding mining areas and produce roughly 13,000 tons ofcopper concentrate (copper equivalent) per year. As for the
Arqueros Mine, we decided to transition to the development
stage after confirming the economic rationality of the project,
and the mine is scheduled to begin operating in 2026 andproduce the equivalent of roughly 15,000 tons of copper per
year. Furthermore, we aim to add more production to reach
50,000 tons per year by promoting new development projects

and retaining rights and interests into the future, and also tobalance the quantities handled on the smelting and mining
sides of the business to create an earnings structure that ismore robust against external factors. We will also work with
our investing partners to streamline as well as discuss andcoordinate the timing of investments to promote the recoveryof cost competitiveness of smelting outsourcing companies,
and promote the procurement of raw materials that stabilize
our operations and recycled materials that enable us tocontribute to a sustainable society.

NITTETSU MINING

18

Overview of Business Segments

Machinery & Environmental Engineering

Long-term goal

• Segment profit: 3,000 million yen or more
Net sales (Millions of yen)

Environmental
engineering

8,000

11,812

Net sales by item
(Millions of yen)

12,520Operating profit (Millions of yen)
13,003

11,083 11,345

1,382

Machineryengineering

1,112

1,257
1,017

5,002

2018

Real Estate•N ew development of idle
company-owned landLong-termgoals• Improve profitability byrearranging properties

2019

2020

2021

2022

(Fiscal year)

2018

2019

2020

1,000

2021

2022

(Fiscal year)

Net sales (Millions of yen)
2,748

2,886

2,803

Operating profit (Millions of yen)

2,825 2,882
1,473

1,609

1,630

1,575

1,707

2018

2019

2020

2021

2022

(Fiscal year)

2018

2019

2020

2021

Supply steam to geothermal power station

Net sales (Millions of yen)
1,923

1,868

Solar power generation

1,782

1,787 1,750

363

2018

Integrated Report 2023

To expand sales for Sinter Lamellar Filter, we plan to develop
the markets in China, South Korea, Taiwan, and Southeast
Asian countries as well as the Republic of Chile, home to oneof our Group companies. As for smoke separators, we arelooking into applications other than removing tobaccosmoke—for example removing CO and nursing care-related
odors—to expand sales.

• Promoting studies for new development• Improving customer satisfaction and ensuring profitability
through renovations• Re-examining the profitability and potential of existing
properties(Fiscal year)

Operating profit (Millions of yen)

Small-scale hydropower generation

19

Although we have expanded the market for sewer systems with
our wastewater treatment agent Polytetsu, we intend to develop
next-generation wastewater treatment chemicals to enter newmarkets. To meet future increases in demand, we are taking steps toreinforce our transport system by enhancing stockpiles—
specifically, building a new Ichihara Chemical Center and expanding
the Fuji Chemical Center. We also plan to construct production
plants in Taiwan and Southeast Asia to increase the competitivenessof our prices while capturing demand in those areas.

• Opening up the global market for dust collectors in Asiaand elsewhere• Enhancing price competitiveness by automatingproduction of dust collector filters and making otherimprovements• Expanding sales by developing new applications for
smoke separators

2022• Maximize the supply of steam for geothermal power stations• Construct and operate new geothermal power stations• Introduce renewable energy throughout the Group

Business activities• Exploring new demand by developing next-generation
wastewater treatment agents• Opening up the global market by constructing wastewater
treatment agent production plants in Taiwan, Southeast
Asia, and elsewhere

Machinery Division

We are presently studying the feasibility of projects underdiscussion for new development using idle company-owned
land, and are also considering rearranging unpromising assets
in terms of future profitability improvement while effectively
managing existing properties to further stabilize profits.

Renewable EnergyLong-term
goals

Environment Division

Business strategy and outlook

Business activities
Leasing of office buildings,
condominiums, storefronts, factories,
warehouses, and sales of real estateBusiness strategy and outlook

2019

2020

2021

2022

(Fiscal year)

2018

415

2019

434

2020

509

2021

547

2022

(Fiscal year)

Business strategy and outlook
Geothermal Division• Conducting investigations and drafting plans to ensure astable a supply of steam to cover the maximum electricity
output of the Ogiri Geothermal Power Station• Promoting investigations for the construction of new
geothermal power stations
Under the project to supply steam to the Ogiri Geothermal Power Station of
Kyushu Electric Power Company, Incorporated, we maintain a calendar-day
facility utilization rate of roughly 70%, one of the highest in Japan. However, we
aim to establish a steam generation-hot water re-injection system to enablestable steam generation over the long term, and are evaluating geothermal
reservoirs as well as analyzing their structure through geophysical exploration ofground surfaces and other studies and formulating plans to dig auxiliary
production wells and wells for re-injection. Additionally, we began geophysicalexploration after receiving approval from the mayor of Kirishima in September
2022 for our survey-phase plan for the city regarding development in the
Shiramizugoe district, another new project. We will continue our development andinvestigation while taking sufficient time to explain them to local stakeholders andgain their understanding.

Solar Power Division• Engaging in stable operations• Considering ways to use surplus electricity
When there is an oversupply of solar power, output control isactivated, preventing facilities from transmitting electricity.
However, in light of legislative trends and technologicalinnovation, we are considering ways to make generated
electricity available even when there is a surplus.

Small-Scale Hydropower Generation Division
For our small-scale hydropower generation using seepage
water from the tunnel of the Kamaishi Mine, we regularly
inspect the tunnels and facilities, and are making
improvements and striving for safe operations. We are also
moving forward with studies of small-scale hydropower
generation at other mines and on company-owned land.

NITTETSU MINING

20

Special
Feature1

Mining Development
Overview of the Arqueros Mine

Contributing to a sustainable society by meeting growing global demand for copper

Development work on the Arqueros Mine begins
Future demand for copper

Global demand for copper is expected tocontinue increasing in the future amid the
pursuit of a carbon-neutral society.
Specifically, copper consumption related
to green energy is expected to increase,with the expansion of solar and wind power
and other renewable energy sources andthe shift to electric and hybrid vehicles
expected to have a significant impact. For
example, in solar and wind power
generation, the materials of solar panels,
power cables, and the like contain copper,
and electric and hybrid vehicles require
more wiring than gasoline-powered
vehicles, which should boost demand forcopper accordingly.

Importance ofcopperConductivity

Although rare metals and other metal resources are
garnering most of the attention in the pursuit of acarbon-neutral society, copper is also gaining importancetoward that end because of its properties.

Processability

Thermalconductivity

Antimicrobial

Essential mineral resources for a carbon-neutral society
Systems & underlying technology

Renewableenergy sector

Power
generation &storagebatteries

Copper, aluminum, rare earth metals

Geothermal power
generation

Titanium

Solar power generation

High-capacity
storage batteries

Lithium-ion batteries
Automotive
sectorStoragebatteries &motorsMajor mineral resources required

Wind power generation

Indium, gallium, selenium, copper

Vanadium, lithium, cobalt, nickel,
manganese, copper

Lithium, cobalt, nickel, manganese, copper

All-solid-statebatteries

Lithium, nickel, manganese, copper

Fuel cells (electrodes,
catalysts)

Platinum, nickel, rare earth metals

High-performance magnets

Hydrogen tanks

Rare earth metals

Titanium, niobium, zinc, magnesium, vanadium

Copper appears in both the renewable energy and automotive sectors.
Source: Mineral Resources Policy for Achieving Carbon Neutrality in 2050, Ministry of Economy, Tradeand Industry

Working toward realizing long-term goals for the Mineral Resources businessAs a mining company
Arqueros Mining
Overview of Arqueros Project
Bolivia
Complexoperating copper mines, we
Mineable reserves:
Mineral26.6 million tons with a copper grade of 1.01%
believe we have a responsibility
deposit/plant
Byproduct: silver (13.1 g/t)
1.8 million t/year of predicted ore production(underground mining)
to meet society’s increasingyTailings
Estimated mine life: 1
 5 years (expected to open in 2026)
tel
storageimademand for copper.
facilityrox mp
Copiapopk
A
35
Accordingly, we have set a
Arqueros
La Serenalong-term goal for our Mineral
La Serena
Coquimbo
RegionAirportResources business: toSantiago
produce at least 50,000 tons ofCoquimbo
Argentina
copper concentrate (copper
OfficeCompañía Minera Arqueros S.A. (80% Nittetsu Mining, 20% Talcuna)Chileequivalent) per year in the
Water source/
We hold 100% of the voting rights and concentrate transaction rights power supply
Talcuna is a preferred shareholder with no investment obligations
Republic of Chile. Based on thisgoal, in April 2023, we decided
Project site
to start construction works of
the Arqueros Mine, a new
1.5- to 2-hour drive from La Serena
copper mine in Coquimbo
500 kmSemi-arid climate/Plateau at an elevation of 1,400 m
Region of Chile. The Arqueros
Mine is scheduled to start
operating in 2026, at which time it will join the presently
operating in tandem, we expect to take a step closer tooperating ATACAMA KOZAN Mine (Atacama Region,
our long-term goal and contribute even more to society.
Chile) in producing copper concentrate. With two mines
Peru

Water line/
power line

21

Integrated Report 2023

mineable reserves are equivalent to 15 years of ore
production; however, we anticipate an extension of thelife of the mine by conducting additional exploration
works while operating.
In terms of the capital structure of Compañía Minera
Arqueros S.A., we own 80% while our Chilean partner
owns 20%. We lead the project as the main
shareholder. Although we are responsible foreverything from initial exploration to developing andoperating the mine, we are committed to using thetechnology, experience, and knowledge we haveaccumulated over the years and developing the minewith the highest priority on safety.

The Arqueros Mine is located roughly 400 km north ofSantiago, the capital of Chile, and 35 km northeast of
the city of La Serena in Coquimbo Region. The mine issituated 1,400 m above sea level on a semi-arid plateau
with sparse bush cover. We joined the Arqueros Projectin 2011, which was initially a greenfield project startingwith exploration, but through a steady stream of studies
progressed to a feasibility study and the development
preparation stage in 2017, followed by the acquisitionof environmental license for development and detailed
design of the mine and plant. We decided to startdevelopment work in April 2023.
The project has 26.6 million tons with a copper gradeof 1.01%, of mineable reserves which are to be mined
underground and expected to produce 1.8 million t/
year of ore, and copper concentrate by flotation. This

Production process

Underground mine

1

Waste rock storage facility (WRSF)

room & pillar, 2% open stoping
Mining 98%
Ore production: 5,000 t/day, 1,800,000 t/year
Blastdrilling

PillarTunneling

PillarUnderground
haulage

Productionbench

5 Concentrate
thickener
IN: 32% solids
OUT: 60% solids

Main access

Filter press
Copper concentrate(water content: 10%)

Copper concentrate storage

8 Shipping

4

Loading at the Port of Coquimbo➡ Secondary & tertiarycrushers

Substation

Ore storage
facility
Access toore processing plant: 900 m

Flotation
cell

Copper mineral recovery

7 Concentrate
filtration

Port of
Coquimbo

Access to
WRSF: 2 km

Blasting Loading

Ore processing plant

2 CrusherPrimary crusher (950 mm)

3 Ball mill

20 L/sStockpile

6 Tailings
storage facility
Thickened tailings
72% solids

110-kVpower line
Length: 29 km

Water main
Length: 27.7 km
Capacity: 27 L/s

Tailings pipeline
Length: 5.4 km, Diameter: 22″

Tailings plant

ProcessFreshwater pool water pool

Recoveredwater line 90 L/s
75% recovery

Tailings
thickener

Pump station 2

Pump station 1

DamascalSubstation

Landscape at the Arqueros
Mine

Nittetsu Mining keeps challenging
As a mining company that has tackled the challenge
of developing underground resources since its
establishment, we have always been engaged in
independent development, managing our own
interests, exploration, development, and operations
from the initial stage. The Arqueros Mine is a projectthat truly embodies our commitment.
However, our appetite for challenges does not end
there. Generally speaking, mining development takes

more than a decade, and the development of the next
copper mine after Arqueros Mine is both our challenge
and our goal. Leveraging our strength in all aspects
from exploration to operation, we are searching forcopper mining development projects in Chile, but alsoin Peru and other South American countries as well as
in Australia, Canada, and North America, all of whichhave high resource potential.

NITTETSU MINING

22

Special
Feature2

Research and Development

Working toward the effective use and stable supply
of copper resources Copper ore beneficiation
Flotation plant design for stable operation with a high recovery

To ensure a stable supply of copper
resources, we are producing copper
concentrate from the ATACAMA KOZAN
Mine in Chile and have plans to bring theArqueros Mine, a new development project,
online in 2026.
The Arqueros Mine is characterized by its
reserves of multiple copper minerals.
Different copper minerals behave
differently in the flotation process,prompting concern that variation in mineralcomposition during operations could
destabilize the copper recovery.
We addressed this issue using Mineral
Liberation Analyzer (MLA) and plant
simulation software to improve the copper
recovery and establish plant design andoperating conditions capable ofaccommodating variation in mineralcomposition.
Stable operation at a high recovery
reduces environmental impact andstabilizes the supply of copper resources,
contributing to the achievement of acarbon-neutral society.

Automated mineralogy using MLA

Flotation testing

Image of minerals

Simulation of the flotation process

Improved plant design

We used a Mineral Liberation Analyzer to analyze thebehavior of each mineral and search for high-recovery
conditions corresponding to different mineral compositions➡ We achieved a plant design that reduces environmental
impact and ensures a stable supply of copper resources

Our R&D Department is researching, developing, andengineering new products and materials to contributeto society based on the wealth of mining development
technology and experience we have amassed over
the years.
The department views itself as one of our service
departments, and thus selects themes ofdevelopment and pursues solutions that proactively
incorporate stakeholders’ needs.
Our research and development on carbon neutrality

Integrated Report 2023

Polytetsu delivers excellent coagulation
sedimentation and deodorization effects, and is used inmany industrial wastewater treatment applications. Ourlineup includes Polytetsu L, which has a higher
concentration of active ingredients than the standard
Polytetsu R and is highly cohesive and dehydrating.
Over the past several years, Polytetsu L sales volume
to sewage treatment plants and private factories havetrended upward. Additionally, the high concentration of
Polytetsu L makes it an environmentally friendly
product that cuts CO₂ emissions from transport by
Figure 1

Schematic diagrams of
the batch method (left)
and continuous
method (right)

Outlook ontechnologicaldevelopment• Realization of even higher recovery• Development of flotation technology
capable of accommodating many differentores• Development of copper recovery
technology based on acid leaching

Research and development that helps reduce greenhouse gases

23

Practical application of the Polytetsu continuous
production method (continuous method) Polytetsu

includes studying carbon dioxide fixation in lime
materials as well as developing ultra-low-carbon lime
products and applied research of stratified
photocatalysts for producing hydrogen fromhydrogen sulfuric acid.
To continue to resolve societal issues in the future,
the department actively searches through andintroduces outside technology and combines it with
our proprietary technology to develop distinct
technologies that will contribute to the future.

Batch method(1)Comparing the sizes of
the reaction tanks for thebatch method (left) andcontinuous method(middle), and a picture of
the actual system (right)

Continuous method
(1)

(2)

(1) Raw material input

As shown on the left side of Figure 1, the batch
method starts with the input of raw materials (1),followed by reaction (2) and product extraction (3). Thismethod is inefficient in taking so much time on tasks
which are not directly connected to the reaction, suchas feeding, heating the raw materials, and cooling thecontents after the reaction is completed. Conversely,
Figure 2

roughly 15% by virtue of the lower amount of chemicals
used and fewer trips made due to it.
However, the production time of Polytetsu L takes 1.5
to 2 times longer than Polytetsu R, resulting in higher
manufacturing costs and longer working hours for the
manufacturers. In response, we developed a more
efficient method to produce high-concentration
Polytetsu L by switching from the conventional batch
method to a continuous method. We also applied thisnew method to Polytetsu R, our standard product,
successfully improving the production efficiency of it.

Batch method
Conventional
technology
Batch method
Reaction tank
(15 m3)

With a reaction tank that is 1/50 the size of the batch
method, the new continuous method is more compact,
and the required reaction time can be shortened
substantially. Since developing this new technology
and putting the continuous method into practice, wehave significantly improved the production efficiency,
the production efficiency can be 200% for Polytetsu R(2)(2) Reaction(3) Product extraction

(3)

(3)

the continuous method (right side of Figure 1) involves
feeding raw materials (1) into a tank with an ongoingreaction (2) while simultaneously extracting the product(3). With this method, most of the production time isspent directly on the reaction. Additionally, the reaction
tank is far smaller than its batch-method counterpart(Figure 2).
Continuous method

New technology
Continuous method
Reaction tank (0.3 m3)

1/50 scaleand 250% for Polytetsu L.
Compared to other inorganic flocculants, Polytetsu
has less CO₂ emissions during production, in addition,
due to the continuous method, contributes to themodern societal issue of achieving carbon neutrality interms of production, transport, and utilization.

NITTETSU MINING

24

Sustainability at Nittetsu Mining
Based on our management philosophy, weestablished a Sustainability Committee in April 2022 toclarify the Company’s efforts on sustainability issues
and improve sustainable business activities and12

medium- and long-term corporate value andestablished a Basic Policy on Sustainability and othersustainability-related policies that the committee uses
to identify material issues.

Material issues

We contribute to the sustainable development of society and the economy
through the development and stable supply of mineral resources.
We understand the significance of protecting the environment andmaintaining biodiversity and promote the reduction of environmental impact
and the efficient, cyclical use of resources in an effort to maintain a healthy
global environment. Specifically, we continue undertaking targeted efforts toachieve carbon neutrality in the context of global warming countermeasures.

Introducing measures topromote capital investment to
reduce CO2 emissions

4

We respect human rights and diversity and provide bright, well-ventilated
workplaces with the aim of helping our employees achieve self-realization andbetter lives.

5

We prioritize safety in all business activities and work to prevent industrial
accidents by creating healthy, sanitary, comfortable working environments.

We disclose information as appropriate to establish and maintain healthy,
quality relationships with all stakeholders.

Energy saving and efficiency• Continued efforts to generate electricity from the long distanceconveyor belts at the Torigatayama Quarry Complex

Representative Director andPresident
Sustainability Promotion Sect.,
Corporate Planning Dept.

Preserving water resources

Report/Proposal

Executive
officeSupervision/
Direction

Significance to stakeholders

Integrated Report 2023

GreatersignificanceE

Policy Chart

Promotingenvironmental
conservation
activities

Basic Policy on
Sustainability

S

Environmental Policy
Human Rights Policy
Industrial Safety and Health Policy(Policy for Responsible
Mineral Procurement)

S

Industrial safety
and healthS

Co-existence andco-prosperity withlocal communities

Materiality map

Co-existence andco-prosperity with local
communities

Providing a stablesupply of raw
materials andproducts

Human Resources Development Policy
Procurement Policy

Promotingenvironmental
conservation activities

Responding toclimate change
Providing a stable supply of
raw materials and products
Respecting human rights anddiversity, and developing
human resources

S

Industrial safety
and healthGreening and properly
maintaining former mine sites
and sedimentation sites

Respecting humanrights anddiversity, anddeveloping humanresources

G
GreatersignificanceStrengthening
governance• Continued efforts to reduce water consumption throughrecycling• Planted trees and performed hydroseeding• Conducted patrols of former mines

Preserving biodiversity• Maintained certified company-owned forests

Developing resources• Developed a new mining area at the Hachinohe Mine: Continued
development work (aiming for full-scale extraction during thenext medium-term management plan period)• Developed the Arqueros Copper Mine: Began development
work in April 2023 (aiming to start operating in 2026)

Providing a stable supply
Managing safety• Continued efforts to comply with ISO 14001 (acquired
certification for seven locations) onstructed a third shaft at the Torigatayama Quarry Complex:•C
Continued construction work (aiming for full-scale operation in FY2024)• Sustained our stable domestic limestone supply systemthrough decentralization• Held meetings of safety managers and meetings of people incharge of safety• Conducted safety training for new employees
Providing education and training • C onducted hazard prediction training by area (East/West Japan)•C onducted hazard prediction training and safety simulation training
Contributing to local
communities• Conducted social contribution activities at each location• Continued to hire locallyDeveloping human resources• Established Human Resources Development Policy in May 2023

Realizing diversity and inclusion

Raising awareness of humanrightsEnhancing the corporate
governance system

Strengthening
governanceSignificance to Nittetsu Mining• Shifted to renewable energy for purchased electricity: Head
Office, Osaka Branch Office, Kagoshima Geothermal Facility,
Promoting a substantial shift toKirishima Officerenewable energy for purchased • Launched an initiative for a substantial shift to renewableelectricity
energy for purchased electricity using FIT Non-Fossil
Certificates with tracking for our FIT solar power plants(purchase of FIT NFCs started in August 2023)

Maintaining an environmental
management system

Management Policy

We engage in fair business activities, observing laws, regulations, and social
norms.

We referred to the GRI Standards to identify
environmental, social, and economic issues inmining, our main line of business. Then, we
carefully considered our mission, thecharacteristics of our business, our strategies,
and what our stakeholders and the rest ofsociety need from us. We created a materiality
map and double-checked the significance ofeach item using models such as the SDGs
wedding cake, which depicts the environment
as the foundation of social and economic
activities. Finally, we arrived at our list of
material issues.

Responding toclimate change

Related SDGs

• Introduced an internal carbon pricing (ICP) system in
November 2022

Sustainability Committee

E

Board of Directors

Corporate governanceWe seek solidarity and harmony with local communities as we develop in aneffort to continue to be a trustworthy, indispensable company.

Main efforts•C onsidered and studied the introduction of solar, wind, andsmall-scale hydropower generation facilities for internal
consumption at quarry complexes and other business locations

Sustainability Committee Chart

Committee
chair

Event

Installing renewable power
generation facilities for internal
consumption

Process of identifying material issues

25

Category

Basic Policy on Sustainability

3

6
7

List of material issues

Strengthening the compliancesystemRisk management• Promoted the active participation of women andemployment of people with disabilities• Promoted improvement of internal environments
Introduced and revised systems for telecommuting,staggered shifts, flexible scheduling, paid leave, etc.
Expanded systems for supporting family care
• Conducted harassment prevention training• Transitioned from a company with an Audit and Supervisory Board to
a company with an Audit and Supervisory Committee in June 2023

• Conducted internal audits at each location• Continued to properly operate the internal reporting system• Held compliance training workshops• Continued to review business continuity plans (BCP)• Held regular meetings of the Quality Assurance Committee• Implemented various initiatives in the field of information security

NITTETSU MINING

26

En v ir onment

Environment
The path toward achieving carbon neutrality by FY2050

Introducing an internal carbon pricing (ICP) systemestablishment in April 2022, our Sustainability
Committee has taken the lead in measuring andpromoting efforts to reduce CO₂ emissions toward
carbon neutrality.

The social and economic impacts of climate change
are becoming increasingly severe, and efforts to curb
rising temperatures by transitioning to a decarbonizedsociety are accelerating around the world. Since its

CO₂ emissions in FY2022
process-derived CO₂ emissions (roughly 21,000 t-CO₂)
and greater fuel consumption, which resulted in moreenergy-derived CO₂ emissions (roughly 1,000 t-CO₂).

In FY2022, domestic Scope 1 and 2 CO₂ emissions
totaled 258,000 t-CO₂, an increase of roughly 22,000
t-CO₂ from the previous fiscal year. This is because theGroup produced more quicklime in FY2022 thanFY2021. Quicklime is produced by calcining limestone;
our increased production of quicklime resulted in more

Roadmap to achieving carbon neutrality
Energy-derived CO2 (fuel-/electricity-derived)

CO2 emissions(thousand t-CO2)

Carbon offsets

300

Non-energy-derived CO2 (process-derived)

Domestic energy-derived
CO2 emissions in FY2030:

At least 38% lower
than FY2013

200

175

163

145

153

154
108

Goal: Achievecarbonneutrality

in Scope 1 and Scope 2
emissions by FY2050

100

101

103

94

83

104

0

2013

2019

2020

2021

2022

2030

2050

(Fiscal year)

Measures to reduce CO₂ emissions
We are promoting several measures to successfully
travel the path set out on our roadmap to carbon
neutrality. The measures include our switch torenewable energy-derived electricity for the entirety of27

Integrated Report 2023

the purchased electricity for our head office in the
Yusen Building in October 2022 as well as the following.
We intend to continue to expedite our efforts to reduce
CO₂ emissions.

In November 2022, we introduced an ICP system for
the Group’s capital investments with an internal carbon
price of 7,000 yen/t-CO₂. The ICP system encourages
low-carbon investment and capital investment for
decarbonized management by converting CO₂
emissions associated with capital investment plans intoa cost—an internal carbon price—to inform investment
decisions. We will apply the ICP system to theinstallation of equipment—for example, energy-saving
equipment and renewable power generation facilities
for internal consumption—to promote capital
investment that helps reduce CO₂ emissions.

Installing renewable power generation facilities for internal consumption
We are considering installing power generation
facilities for internal consumption based on renewableenergy sources (solar, wind, small-scale hydropower) at
all Group locations. We are in the process of verifying indue order the technical and economic aspects andCO₂-reducing effects of installing power generationequipment on idle land at quarry complexes and the likeand on the roofs of factory buildings and offices, andwe plan to use the ICP system and other resources toinstall power generation facilities first and foremost at
locations where such installation is deemed to befeasible.

Status of considerations for installing renewable power
generation facilities for internal consumption
Type

Number of locations
under consideration

Status of considerations

Solar
power

7

Wind
power

Consideration of specifications,partial implementation of detailed
design1Wind condition surveys underway

3

Water volume surveys underway

Small-scalehydropower

Substantial shift to renewable energy for purchased electricity through FIT Non-Fossil Certificates
In August 2023, we began purchasing FIT Non-Fossil*1*2
Certificates with tracking for our FIT solar power*3
plants to key a substantial shift to renewable energy
for a portion of purchased electricity for the
Torigatayama Quarry Complex. We also expect thisinitiative to deliver CO₂ emissions reductions of roughly
6,200 t-CO₂ and 9,200 t-CO₂ in FY2023 and FY2024,*4
respectively.

*1: FIT Non-Fossil Certificates
Certificates showing the environmental value of renewable energy and othernon-fossil electricity sources and certifying the non-fossil value of electricity
generated at renewable energy power plants under the FIT system*2: Tracking
Attribute data of power plants (e.g. IDs, names, and installers of power
generation facilities)*3: FIT solar power plants
Solar power plants under the Feed-In Tariff (FIT) system for renewable energythat generate electricity that electricity utilities purchase for a fixed period oftime at prices determined by the government*4: CO₂ emissions reductions
Calculated based on the estimated number of NFCs purchased and theemission factor for purchased electricity for the Torigatayama Quarry Complex(for reporting in FY2023) under the Act on Promotion of Global WarmingCountermeasures

Other future initiatives• Streamline facilities and introduce energy-saving technology• Promote transition to EV in the company vehicle fleet• Switch to biofuels for heavy machinery, use technological innovations to switch to electric heavy machinery,etc.
• Increase forest absorption by greening former mine sites and sedimentation sites at active mines• Introduce new technology for CCUS and the like to reduce process-derived CO2 in the future

NITTETSU MINING

28

Environment

Long distance conveyor belts that contribute to reducing
environmental impact

Managing tailings dams

The Torigatayama Quarry Complex features nine long

downhill, and the potential energy of the limestone they

extracted from the mines a total of 23.3 km to theother six conveyor belts.

distance conveyor belts that transport limestone

coastal ore processing plant. Using conveyor belts

transport generates enough electricity to power the
Additionally, to prevent dust and noise during ore

instead of trucks helps reduce CO₂ emissions intransport, all above-ground sections are enclosed inwith low environmental impact.

regular measurements and evaluations.

transport and allows us to transport mineral resources
Three of the nine conveyor belts are steeply sloped

soundproof galleries, and we conduct daily patrols andResponse to water risks
The Group uses water mainly in the beneficiation
process in the Mineral Resources business. Water
resources are not only essential to sustain the Group’sbusiness, but are also very important to the residentsof the communities in which we operate. Therefore, we
are working to reduce our water consumption throughefficient use and recycling of water resources andtaking steps to meet our stated goal of preserving
water quality.

We also use Aqueduct—a suite of tools developed by
the World Resources Institute (WRI) to assess thestatus of water risks at production locations andlaboratories—to identify areas with water risks, andrecognize the Republic of Chile, where we develop andoperate copper mines, as an area with particularly highwater risks. In the future, we will conduct more detailed
risk analysis and take steps to ascertain the amount ofwater used at each intake to ensure efficient use ofwater resources.

Recycling water
We strive to reduce both intake and wastewater byof some limestone products, and toward other ends,

business. After using water in the beneficiation process

and recycle with wastewater treatment facilities.

recycling water mainly in the Mineral Resources

to raise the grade of mined copper ore, in the washing

we have wastewater mixed with solids, which we treat

Examples of water recycling in a limestone mine in Japan
Business activities (plant)
Insufficient
intakeWater frommine shafts
Groundwater
Tap water
etc.

Wastewater resulting
from water
consumption

Wastewater treatment
facilities
Wastewater

Sedimentation
tank

Integrated Report 2023

Greening former mine sites and preventing pollution
Mining development inevitably involves altering theenvironment, for example by removing trees fromexcavation areas. Decades pass between thedevelopment and closure of mines; we plant trees andvegetation in extraction areas and sedimentation sites
after mining-related operations are complete in aneffort to restore the environment and landscape. We
also conduct patrols and inspections and perform thenecessary maintenance at former mines throughout
Japan to prevent pollution.

Greening results (consolidated)
Unit

Tree planting

Seed spraying

trees
m2

FY2020

FY2021

FY202255,06445,82047,667

4,058

5,545

10,061

Acquiring certification for company-owned forests
We plant trees on former mine sites and idle land as

we acquired SGEC forest certification for one of oursustainable forest management while maintaining theroughly 1,200 ha) to further preserve forest functions

part of our CSR activities. We have conducted

diverse functions of forests, for example preserving

biodiversity, recharging water sources, and preventing
Filter press

water recovered from the dewatering process, which
covers roughly 80% of the water needed for the
production process, thereby reducing intake.
Additionally, the new dewatered sediments are locateddownstream of the old sediments, which also has theeffect of reinforcing the structure of the old tailings
dams as they settle.
Tailings dam management involves daily water
sprinkling to prevent dust, routine inspections, andscheduled surveying to ascertain storage capacity andconditions. We have also installed observation wells
downstream to check for leakage, and regularly
conduct water quality inspections.

global warming by absorbing CO₂. In December 2013,

company-owned forests in Shiraoi, Hokkaido (area ofand sustainably use forest resources. In December

2018, we were reviewed for renewal and reauthorized,
and our commitment to healthy forestry is ongoing.

Maintaining an environmental management system

Recycled water

Sediment (highSediment
moisturecontent)

Recycled water

29

Return solids to products

We produce copper concentrate at the ATACAMAKOZAN Mine in Chile. Tailings dams (tailings storage
facilities) impound tailings—the slurry that remains
after concentrate is removed from the ore during the
production process—to allow the solids to separate
from the water and settle to the bottom. From the startof operation in 2003 until 2020, the coarse grains ofclassified tailings were used as embankment materials,
and the fine grains were allowed to settle on the insidesof the dams. In 2020, we built a new tailings processing
facility near the tailings dams and began using amethod by which the tailings are allowed to settle after
further dewatering than the old method. We recycle theWe have obtained ISO 14001 certification at sevenlocations, including our Torigatayama Quarry Complex,
the first mine in Japan to obtain certification that
includes the scope of mining. By continuously
maintaining the environmental management systems,

we ensure that everyone at every location—from top
executives to employees of affiliate companies—isworking together to reduce environmental impact andprevent pollution.

NITTETSU MINING

30

Environment

Endorsing the TCFD recommendations
With the recognition that addressing climate change
is one of the most important management issues, theGroup announced its endorsement of therecommendations of the Task Force on
Climate-Related Financial Disclosures (TCFD) in June

Our Sustainability Committee—which is chaired by
the President and comprises internal Directors andCorporate Executives as members—formulates
policies, targets, and action plans for combatingclimate change and realizing other aspects ofsustainability for the Group; manages and evaluates ourStrategies

We have exhaustively identified risks andopportunities presented by the impact of climatechange on each of the Group’s businesses under two
scenarios—a global average temperature increase of
2°C or lower, and an increase of 4°C—and are taking

Policies/
legal
regulations

Transition risks

Technology

MarketReputation

Physical risks

Chronic

31

Integrated Report 2023

relevant measures to reduce risks and seize
opportunities. We plan to analyze the scenarios to gain
an understanding of the impacts on our business, andwill formulate strategies accordingly.

Risk oropportunity

Increase in carbon
pricing

Risk• Costs increase when new carbon-related taxes are introduced • Ongoing information gathering

Tighter regulations

Risk• Costs increase amid the shift to electric/energy-saving equipment
and systems at production locations• Costs increase when fuels and power sources for large and heavymachinery are changed

Spread ofrenewable energy/
energy-saving
technologies

Fluctuation of
product/material
pricesChanges incustomer behavior

Risk
Opportunity
Risk
Opportunity
Risk
Opportunity
Risk
Opportunity

Acuteprogress toward the targets; discusses individual
measures in depth; and reports and advises the Boardof Directors on a regular basis. The Sustainability
Committee has two regular meetings each year (in May
and November) and holds extraordinary meetings asneeded (once in October during FY2022).

Event

Development of
new technologies

Intensification of
meteorologicaldisasters (e.g.
typhoons, floods)

Increase in mean
temperatures

Risk management
After identifying climate-related risks andAdditionally, in terms of efforts to achieve carbon

and reconsiders them through its consideration of

CO2 emissions, manages the progress of plan

opportunities, the Sustainability Committee evaluates
responses and subsequent monitoring, and regularly

GovernanceCategory2022. We aim to engage in sustainable businessactivities and improve our corporate value over the
medium to long term by promoting initiatives to realize
a decarbonized society.

Risk

Description

Opportunity• Introducing the ICP system to promoteelectrification, energy-saving, and otheradvancements for reducing CO₂ emissions• Demand for limestone decreases when alternative materials andtechnologies are developed• Promoting limestone exporting• Energy procurement costs increase when we purchase renewableenergy• Installing renewable power generation facilities forinternal consumption to reduce purchased electricity•D irectly procuring FIT Non-Fossil Certificates to reduce thecost of shifting to renewable energy power sources• Profits increase when we develop products that help lower GHG
emissions• Greater possibilities for new development in geothermal power
generation, solar power generation, and other areas• Promoting research and development that helps
reduce GHG emissions• Promoting geothermal development in
Shiramizugoe• Identifying projects in the context of internal exploration•R aw material procurement costs increase as decarbonization progresses• Investment costs increase as competition for mining development projects intensifies • J oining projects from the early stages of•R egulations become stricter and tax burdens grow as resource nationalism emerges
development• Demand for copper increases amid growing demand for electrification • L aunching development work on the Arqueros Copper•E conomically mineable ores increase as the profitability of copper mines increases
Mine and promoting the identification of other projects• Costs increase when we respond to demand for products withlower GHG emissions• Customers demand more products that help reduce GHG
emissions• Costs increase as we undertake disaster control measures anddisaster recovery at production locations• Sales decrease due to supply chain interruptions• Demand for limestone increases as disaster risk reduction
infrastructure is developed
Opportunity• We retain the ability to produce and deliver during disasters byleveraging the strengths of our dispersed locations
Risk

Relevant initiatives• Risk of flood damage at coastal locations due to sea level rise
• Operations impacted by the increased risk of drought• Productivity declines due to negative impacts on worker health• Demand for wastewater treatment agents increases as water quality
declines (nutritive salts, red tides) and reclaimed water use increases• Productivity increases when we revise working environments• Installing renewable power generation facilities forinternal consumption to reduce purchased electricity• Directly procuring FIT Non-Fossil Certificates to reducethe cost of shifting to renewable energy power sources• Reinforcing our supply system for Polytetsu• Sustaining our stable supply system throughdecentralization of limestone mines• Sustaining our stable supply system throughdecentralization of limestone mines• Promoting and continuing to use recycled water

reports significant risks to the Board of Directors.

neutrality, the committee discusses plans for reducing
implementation, and takes necessary measures.

Indicators and targets
The Group is making efforts to reduce CO2 emissions
by steadily transitioning to implementing measures tocombat climate change, including reducing fuel andelectricity consumption by streamlining and switchingto energy-saving facilities and introducing renewableenergy-based power generation facilities and switching
to renewable electricity for internal consumption.
*1
Specifically, we aim for a 38% or higher reduction ofenergy-derived CO2 emissions from domestic Group
companies’ consumption of fossil fuels and electricity
out of their total CO2 emissions—the sum of their direct(Scope 1) emissions and indirect (Scope 2) emissions
from their use of electricity and other energy
purchased from other companies—from the FY2013
level by FY2030, identical to the Japanese

government’s target for the corresponding CO2*2
emissions category. Notably, we intend to further
reduce non-energy-derived CO2 emissions from thequicklime production process by monitoring
technological advancements and introducing newtechnology for CCUS and the like once it is ready forreal-world implementation.
We also plan to introduce new technologies and use
carbon offsets and other means of achieving carbon
neutrality to meet the long-term goal of reducing direct
and indirect (Scope 1 and Scope 2) emissions of theGroup’s non-energy-derived CO2 by FY2050.

*1: 38% or higher reduction from the FY2013 level:
The target rate of reduction for CO2 emissions derived from fuel and electricity consumed at plants and business locations under the Industrial category of theJapanese government’s CO2 emissions categories*2: The Japanese government’s FY2030 target for the corresponding CO2 emissions category:
The rate of reduction for the corresponding CO2 emissions category set out in the Comprehensive Plan of the Government under the Act on Promotion of Global
Warming Countermeasures (approved by the Cabinet on October 22, 2021)

TOPICS

Calculations based on the GHG Protocol
We began calculating
GHG emissions for the
consolidated scope(including overseas
affiliate companies)
based on the GHG
Protocol in FY2022.
The following tableshows the calculationsof Scope 1 and Scope
2 emissions for
FY2022. In the near
future, we will calculate
Scope 3 emissions andwork toward disclosure.

Calculations based on the GHG Protocol (consolidated, including overseas)
Indicator

Unit

GHG emissions (Scope 1 & 2 total)

thousand t-CO₂

Scope 2

thousand t-CO₂

Scope 1

Total energy consumption

Non-renewable fuel consumption

Non-renewable electricity consumption

Other non-renewable energy consumption

Renewable electricity consumption

thousand t-CO₂
MWh
MWh
MWh
MWh
MWh

FY2022

327
210
117

555,635
348,523
206,488442
182• Reinforcing our supply system for Polytetsu

NITTETSU MINING

32

S oc ial

SocialEfforts for industrial safety and health
We have established an Industrial Safety and Health Policy based on our priority on safety in all business activities,

and the Safety Administration Office at our head office takes the lead in promoting safety activities.

Nittetsu Mining Group Industrial Safety and Health Policy

All Nittetsu Mining Group employees work together to ensure industrial safety and health in the course of conducting business based on thefollowing policy as well as the fundamental principle to prioritize safety in all business activities.

1. Compliance with laws
and regulations
2. I mplementing education andawareness-raising activities
3. Creating comfortableworking environments

Education and training
Every year, we conduct new employee safety training
and regional hazard prediction training for East andWest Japan. Each location also conducts hazard
prediction training and hands-on safety courses asneeded to enhance employees’ sensitivity to danger. In

level-based training for management and key
managers, we strive to provide educationcommensurate with their respective positions as
managers and supervisors to allow them todemonstrate their leadership abilities.
Results of industrial safety and health training(total number of participants)

In addition to observing laws, regulations, and internal rules pertaining to industrial safety and health, we work
to create safer working environments through ongoing risk assessment and measures to prevent accidents
similar to past accidents.

FY2020—We continuously implement education and awareness-raising activities to improve our awareness ofindustrial safety and health.

FY2021284

FY2022555

Notes: 1. Results of training provided by the Safety Administration Office todomestic Group companies

We make efforts to establish working environments that are sanitary, comfortable, and healthy in both
physical and psychological terms.

2. All training was canceled in FY2020 due to the COVID-19 pandemic

Safety performance in 2022 (including contractors working onsite)
Number of fatal accidents

Number of accidents resulting in
absence from work*

Number of accidents not requiring
absence from work

Percentage of accidents resulting in
absence from work*

Japan
0

Overseas
0

4

11

14

34

1.27

—

Co-existence and co-prosperity with local communities* 1 or more days lost

Management system
Each year, our Safety Administration Officeestablishes Safety Administration Office policies basedon evaluations of the previous year’s safety and healthperformance, and provides support and guidance toeach location. Meetings of safety managers and people
in charge of safety attended by representatives fromeach location are held each year at the head office toshare initiatives based on the Safety Administration
Office policy and discuss measures to prevent
recurrence of industrial accidents and other matters.
Additionally, to exchange information on safety andcheck the status of safety management, the Safety
Administration Office conducts safety patrols at eachlocation based on an annual plan.
When an industrial accident occurs, the officespreads the word throughout the Group by
disseminating information on the circumstances of theaccident—including industrial accidents that do not
result in absence from work, accidents resulting inproperty damage but no injuries, and traffic accidents—and measures to prevent recurrence. For serious

33

Integrated Report 2023

A hands-on safety course in the fieldindustrial accidents, the Safety Administration Officeleads onsite investigations and provides guidance on
the necessary countermeasures, and the details arealso shared within the Group. This information isreflected in hazard prediction training at each locationin an effort to improve safety awareness and prevent
similar accidents.

Sustaining cooperative relations with the areas andcommunities in which we do business is essential forour mining operations and other businesses. We strive
to co-exist and co-prosper with local communities bycreating employment opportunities and through local
procurement in the context of our business activities in

addition to engaging in dialogue with local people,
implementing environmental conservation activities,
participating in and sponsoring local events, offering
tours of our business locations, and undertaking otheractivities to establish mutual understanding andtrust-based relationships.

TOPICS• Major social contribution activities at overseas locations

Sociedad Contractual Minera Atacama Kozan, a consolidated subsidiary, engaged in the following social contribution activities in the regionin which it operates.
Accepted 20 local students for practical internships

Conducted welding training for 40 women in Tierra Amarilla and Copiapo

Conducted industrial electrical technology training for 19 students
from Tierra Amarilla

Provided support for a celebratory event (Children’s Day) in Tierra Amarilla
Conducted training for painting for 16 residents of Paipote

Conducted training for residents of Paipote to obtain driver’s
licenses• Contribution to local employment opportunities

Support for a celebratory event(Children’s Day)

Training for painting

At the Group’s locations in Chile (Sociedad Contractual Minera Atacama Kozan, Compañía Minera Arqueros S.A., and Nittetsu Mining ChileLtd.), we actively hire local people; in fact, local employees make up 41.7% of senior (general manager-level) management positions.
Additionally, women hold 8.2% of management (section manager and higher) positions, and we are promoting active participation by women.

A meeting of people in charge of safety

NITTETSU MINING

34

SocialDeveloping human resources
Since our establishment, we have overcome various
difficulties and sustained our business because eachand every employee has confronted the circumstancesand changes of the times and proactively worked toresolve issues.
We believe we need people capable of thinking andacting independently in order to grow sustainably as anintegrated mineral resources company. Accordingly,
we have established a Human Resources Development
Policy to develop those kinds of people.

We have established a development system withelements of personal growth—among them,experience and lessons through daily work, guidanceand cooperation with supervisors and colleagues,
self-learning and self-study, and level-based training
and other Company-sponsored training—that wesynchronize with the aim of creating working
environments where employees can demonstrate theirabilities.

Indicators for active participation by women (Nittetsu Mining)
FY2020

FY2021

FY2022

9.5%

23.1%

14.7%

5.5 years

4.5 years

4.5 years

Percentage of women hired

Percentage of women hired (career track positions
only)
Gender gap in average continuous service
Percentage of female employees

7.7%

Percentage of female employees taking childcare leave

Gender wage gap*

21.7%

15.5%

19.6%

16.1%

100%

15.8%

100%

53.9%

100%

55.7%

54.5%

* These figures are calculated for all employees in accordance with the Act on the Promotion of Women’s Active Engagement in Professional Life.

Nittetsu Mining Group Human Resources Development Policy

The Nittetsu Mining Group is committed to developing human resources who think and act independently to achieve sustainable growth as
an integrated mineral resources company, by developing specialized human resources under our human resources development system andcreating working environments where each and every employee can demonstrate their abilities.

1. We encourage the growth of each and every employee through self-directed learning.
2. We seek to accommodate diverse learning styles and create environments where motivated employees can learn
when they want to.
3. We develop human resources capable of fulfilling active roles on a global stage.

Promoting diversity

Consistent with our Management Policy, we strive to
be a company where each and every employee canwork with high motivation and pride. Accordingly, wehire throughout the year and make our selections
regardless of gender, nationality, or whether someone
is a new graduate or midcareer candidate in an effort toensure that our employees have a diverse array ofabilities and values. We encourage each and every
employee to flourish and grow in their line of work andeventually earn promotions as core members of thecompany so that we as a company can growsustainably and increase our corporate value.

Percentage of management positions (Nittetsu Mining)
Women

Foreign nationals
Mid-career hires

Results (FY2022)
1.0%

0.5%

11.2%

Target (FY2030)
5% or more

5% or more

15% or more

the same for men. We will continue to strengthen our
recruitment of female employees and devote energy toproactively training female employees and developing
environments conducive to long-term employment inorder to promote retention in addition to promoting
female employees to management positions.

Action Plan based on the Act on the Promotion of Women’s Active Engagement in Professional Life (Duration: April 1, 2021–March 31, 2026)
Target 1: Women comprise at least 30% of new hires in career track positions
Target 2: Trim the gender gap in average years of service to two years or less

35

Integrated Report 2023

Our measures for improving internal environments toensure diversity include instituting a telecommuting
system, introducing staggered shifts, flexible
scheduling, and other systems for accommodating
various work styles, a system for rehiring retired
employees, a leave system for employees whose

spouses are transferred, a system allowing employees
to take paid annual leave in half-day increments, andother efforts to develop environments where each andevery employee can work in such a way that their job
and life are in balance.

Systems for supporting family care

Promoting active participation by women
We have long been aware of the challenges ofpromoting women’s advancement and began actively
recruiting women for career track positions in 2014,and have continued our recruiting activities with thegoal of increasing the percentage of women in such
positions to at least 30%. However, various indicators
for women in career-track positions are still lower than

Improving internal environments

We provide support to employees who are providing
childcare and elderly care by enhancing our systems
for supporting them beyond the requirements of laws
enacted to facilitate a balance between work and familycare. Specifically, we offer paid leave for employees tolook after spouses giving birth or to take care of sickchildren or elderly family members, and extend theduration of our system that allows employees to work
shorter hours so that they can take care of sick children
or provide childcare (through the end of their children’s
sixth year of primary school) in addition to maintaining
systems that satisfy the laws.

Employing people with disabilities
To contribute to the creation of a prosperous society
in the future, we are promoting the employment ofpeople with disabilities in order to diversify our humanresources. We will promote the creation oforganizations that view disabilities and theirimplications as individuality, allow diverse talents toflourish, create environments conducive to long-term
employment, and achieve high retention rates.

Employment rate of people with disabilities (Nittetsu Mining)
FY20202.31%

FY2021
2.57%

FY20222.37%

Preventing harassment
We prohibit and have set out policies and regulations
to prevent all forms of harassment and discrimination.
We will continue to implement awareness-raising
activities, including incorporating harassment
prevention into training at all levels, having all
employees participate in e-learning, and distributing
booklets and showing videos to all employees. We will
also establish contact points for reporting andconsultation to equip the company to take the proper
steps to prevent the recurrence of any incidents that
occur.

Number of participants in harassment prevention training (total)
FY2020547

FY2021105

FY2022668

Note: Only training sponsored by the Human Resources Department of thehead office

NITTETSU MINING

36

G overna nce

Corporate Governance
In June 2023, we transitioned to a company with an Audit and Supervisory Committee. As an integrated
mineral resources company, we will work to strengthen our corporate governance to achieve sustainablegrowth and increase our corporate value over the medium and long term.

Basic approach to corporate governance
We make proactive efforts to establish organizations
capable of swiftly and appropriately responding tochanges in the business environment, andmanagement systems to equip the Company to
execute decisions with the utmost fairness andtransparency.
We will continue efforts to establish, enhance, andensure the effectiveness of a shared internal

understanding of the importance of corporate
governance, and aim to become a company worthy of
the trust of shareholders, users, and local communities.
We formulated the Nittetsu Mining’s Basic Policy on
Corporate Governance to outline our basic approach toand policy for corporate governance, and havepublished it on our website.

General Meeting of Shareholders

Nomination &Remuneration Committee
Sustainability Committee

Transition to a company with an Audit and Supervisory Committee
on our Audit and Supervisory Committee are Outside
Directors, and Directors who are Audit and Supervisory
Committee Members have voting rights on the Board of
Directors. We have also established an executive officeto assist the Audit and Supervisory Committee in thesmooth execution of its duties. Under the newcorporate governance structure, we aim to further
improve the soundness and transparency ofmanagement.

AdviceConsultation
Report/Proposal<Executive Business Functions>

Proposal/Report<Decision-Making/Supervisory Functions>Board of Directors

ReportRepresentative Director

Appointment/
Removal/Supervision
Direction
Report(Senior) Corporate Executive
Management Council(deliberation and decision ofimportant subjects)

Election/
Dismissal

Election/
Dismissal

Direction/
Supervision

Election/
Dismissal/
RefusalReportAudit and Supervisory Committee

Evaluation

Accounting Auditor

Cooperation

Audit/
Supervision

Supervision/
Direction

Supervision

Executive Director

Nittetsu Mining’s Basic Policy on Corporate Governance (Japanese version only)
https://www.nittetsukou.co.jp/ir/governance/pdf/policy.pdf

At the 109th Annual General Meeting of Shareholders
held on June 29, 2023, we transitioned to a company
with an Audit and Supervisory Committee in order tostrengthen the supervisory functions of managementby the Board of Directors and to expedite
decision-making by delegating some matters to beresolved at the Board of Directors meetings to
Executive Directors, thereby enhancing deliberations at
Board of Directors meetings. Two of the three Directors

Corporate governance system chart (as of June 29, 2023)

ReportAudit

Cooperation/Report

Internal Audit Office(Audit & Supervisory Committee
Members’ Office)Cooperation

Audit

Audit

ReportHead Office / Branch Office / Quarry Complex / Subsidiaries

Board of Directors

In principle, the Board of Directors holds regular monthly
meetings and ad-hoc meetings as needed to make decisions
on matters required by law, important management matters,
and the like, and to supervise the execution of the Company’sbusiness operations and the management of its subsidiaries.
The Board of Directors presently comprises a total of nine
members (five internal Directors, four Outside Directors) andis chaired by the President.

Audit and Supervisory Committee

Audit and Supervisory Committee conducts audits incooperation with the Internal Audit Department based on theaudit plan determined by the committee. The committee
presently comprises one internal Director who is a standing
member with in-depth knowledge of finance and accounting,and two Outside Directors with expertise in their respective
fields. The two Outside Directors are a scholar and an
attorney, and have provided insightful views and observations
based on their plentiful knowledge and experience.

Composition of the Board of Directors and Audit and Supervisory
Committee in FY2023

We believe it is important that our Board of Directors
and Audit and Supervisory Committee comprisemembers with diverse perspectives, diverse
experience, and both diverse and advanced skills tosupervise business execution and make important
decisions.

Name

Executive

OutsideIndependent

Integrated Report 2023

Sex

Reiichi Morikawa●

Men

Yukihiko Hagikami●

Men

Hirofumi Fujimoto●

Men

Kenji Otakara●

Men

Nobumichi Izumi

●

●

Men

Kenichi Itakura

●

●

Men
●

Men

Eiki Hotta

●

●

●

Men

Yuko Aoki

●

●

●

Women

Seiji Yasuda

37

Audit andSupervisory
Committee
MemberNITTETSU MINING

38

Corporate Governance

Governance

Skills matrix for Directors (as of June 29, 2023)
Nomination &Years inSustainability
Remuneration
officeCommittee
Committee

Name

Reiichi Morikawa

6

Hirofumi Fujimoto

4

Yukihiko Hagikami
Kenji Otakara

Nobumichi Izumi
Kenichi Itakura

◎
⃝

2

⃝

4
2

Seiji Yasuda

4

Eiki Hotta

6
1

Yuko Aoki

⃝

4

⃝
◎
⃝

Business
Mining
Human
Corporate
Legal/
strategy/ engineering/ Research &Finance/resources/
management/ Internationality
Risk
Sales/
Safetydevelopment
Accountant Human resource
Sustainability
management
Marketing environment
development

Position●●●

Director and Corporate Executive

●

●

●

●

●

●

Director and Corporate Executive

●

●

●

●

●

●

●

●

Representative Director and President
Director and Corporate Executive
Outside Director●

Director (Standing Audit andSupervisory Committee Member)●

Outside Director (Audit andSupervisory Committee Member)

⃝

●

●
●

●
●

Outside Director⃝

Evaluating effectiveness●●Outside Director (Audit andSupervisory Committee Member)●●

Notes: 1. The chairs of the Nomination & Remuneration Committee and the Sustainability Committee are marked with double circles.
2. Years in office represents the total number of years in office as an Audit & Supervisory Board Member.
3. In addition to the members listed above, the Sustainability Committee also includes Corporate Executives Masanobu Kawata (Responsible for Machinery &Environmental Sales Department and Research & Development Department), Hiroyuki Sakaguchi (Responsible for Limestone & Raw Material Sales Department), Ken
Soda (Responsible for Mining Department and Safety Administration Office, General Manager of Mining Department), Tsutomu Nomura (General Manager of General
Administration Department and General Manager of Business Continuity Management Office), and Tomohiro Saito (General Manager of Torigatayama Quarry Complex).

Number of female
Directors

Female:1 / Male: 8

Number of Outside
Directors

Percentage
of female
Directors

11.1%

Outside:4 / Inside: 5

Percentage
of Outside
Directors

44.4%

Main Boards and Committees (as of March 31, 2023)
Number of members:

Board ofDirectors

Number of meetings
in FY2022

16

Number of members:

Audit &
Supervisory
Board

The Board of Directors, which comprises nine Directors (including three
Outside Directors), holds ordinary meetings monthly and is also ready tooperate expeditiously, for example holding extraordinary meetings about
matters that require swift decisions. Additionally, matters of high importanceare brought to the Board of Directors only after they are examined andvigorously discussed from multiple perspectives at Management Council
meetings based on the Company’s long-term management strategy.

4 Percentage of Outside Audit & Supervisory Board Members: 50%

Number of meetings
in FY2022

15

In FY2022, consistent with our status as a company with an Audit andSupervisory Board, the Audit & Supervisory Board met 15 times. The Audit &Supervisory Board comprised two Standing Audit & Supervisory Board
Members with a wealth of experience working at the Company and two Outside
Audit & Supervisory Board Members who are experts in their respective fields;
in and after June 1998, at least half of the members were Outside Audit &Supervisory Board Members who provided the Company with insightful views
and observations based on their plentiful knowledge and experience.

Number of members:

Nomination &Remuneration
Committee

39

Integrated Report 2023

Number of meetings
in FY2022

5

9 Percentage of Outside Directors: 33%

4 Percentage of Outside Directors: 75%

As to the functions of the Board of Directors with regard to the nomination
and remuneration of Directors, this committee elicits recommendations fromand ensures proper involvement by Outside Directors with the aim ofenhancing the fairness, transparency, and objectivity of the procedures,strengthening the management system to support fairer, more transparent
decision-making, and enhancing the Company’s corporate governancesystem.

In March 2023, we administered a survey to all
Directors and Audit & Supervisory Board Members(including outside executives) asking them toself-assess the effectiveness of the Board of Directors
in FY2022. In FY2022, the Board of Directors analyzed,
discussed, and evaluated the status of responses toissues identified in the previous fiscal year, while
reviewing the results of their analysis, discussion, andevaluation based on the results of the evaluation
conducted by an external organization that year.
Evaluations from the survey responses were generally
positive, and our average score for each response in
FY2022 was generally higher than in the previous fiscal
year, indicating that our Board of Directors isfunctioning effectively.
Based on the results of FY2021, we decided to holdoffsite meetings after Board of Directors meetings toallow for free, open-minded discussion and exchangeof opinions among the members of the Board of
Directors. Upon analysis, discussion, and evaluation
based on the results from FY2022, the Board of
Directors identified some issues to continue working

on in this fiscal year, such as ensuring opportunities formore free, open-minded exchange of views, andreaching ideal levels of diversity in gender and otheraspects, on the Board of Directors and throughout theCompany. The Board of Directors agrees that there isroom for further discussion and improvement.
Important matters concerning Company operations
are discussed at the meetings of the Management
Council, which are attended by all Directors and Audit &Supervisory Board Members, based on free,open-minded discussions and exchange of opinions
before being brought to the Board of Directors. All
Directors continue to attend meetings of theManagement Council even after the transition to acompany with an Audit and Supervisory Committee atthe 109th Annual General Meeting of Shareholders heldon June 29, 2023.
We intend to continue efforts to enhance thefunctions of the Board of Directors to further improvethe corporate value of the Group.

Executives’ remuneration
Directors’ remuneration comprises fixed monthly
remuneration and performance-linked bonuses andshare-based remuneration within the maximum amountof remuneration determined at a General Meeting of
Shareholders.
Our basic policy when determining monthly
remuneration for individual Executive Directors is to set
appropriate amounts commensurate with their
responsibilities. In pursuit of sustained growth andimproving our corporate value over the medium to longterm by continuously expanding our earning capacity in
our main business activities, we also offer
performance-linked remuneration and share-based
remuneration, and our basic policy is to use
consolidated operating profit as the performanceindicator for the former, and to offer the latter toencourage further sharing of values with shareholders.
Remuneration for Executive Directors comprises fixedbasic remuneration, performance-linked remuneration
based on single-year consolidated operating profit andthe operating profit target achievement rate during thethree-year Medium-Term Management Plan period, andshare-based remuneration commensurate withposition.
As for remuneration for Directors who are Audit andSupervisory Committee Members and Outside
Directors, we only pay monthly remuneration because
they are tasked with monitoring and supervising themanagement of the Company from a neutral, objective
standpoint.
Notably, amounts of remuneration for individual
Directors (excluding Directors who are Audit andSupervisory Committee Members) are determined byresolution of the Board of Directors. In the course ofdeliberating and resolving proposals on Directors’
remuneration, the Nomination & Remuneration
Committee discusses the proposals from a neutral,
objective standpoint and reports the results of their
discussions to the Board of Directors, which thenmakes decisions based on the committee’s views.
Amounts of remuneration for individual Directors who
are Audit and Supervisory Committee Members are
determined by discussion among the Directors who are
Audit and Supervisory Committee Members, within thelimit of amounts of remuneration approved by General
Meeting of Shareholders.

NITTETSU MINING

40

GovernanceCorporate GovernanceClassification of total remuneration for Directors and Audit &Supervisory Board Members in FY2022
Category

Total remuneration(Millions of yen)

Directors

287

Audit & Supervisory
Board Members
Outside executives

Total amount of remuneration by type (Millions of yen)
Bonus
Monthly remuneration(performance-linked(fixed remuneration)
remuneration)

Non-monetarycompensation, etc.

Information security

Number of recipient
executives

244

43

-

9

64

64

-

-

4

44

44

-

-

5

Notes: 1. The above includes one Outside Director who assumed office on June 29, 2022.

2. The amount paid to Directors does not include employee salaries or bonuses for Directors who concurrently serve as employees.

3. We use the Company’s trailing 10-year operating margin as the indicator for performance-linked remuneration in an effort to achieve sustained growth andimprove our corporate value over the medium to long term by continuously expanding our earning capacity in our main business activities. The target for thecurrent fiscal year is 6.1%; our actual operating margin for the current fiscal year is 6.0% (an achievement rate of 99.8%).

4. The maximum amounts for executive remuneration approved at the 93rd Annual General Meeting of Shareholders held on June 28, 2007 are 27 million yen for Directors’monthly remuneration (not including the portion of employee salaries for Directors who are concurrently working as employees) and 6 million yen for Audit & Supervisory
Board Members’ monthly remuneration; the number of recipient executives at the time of the resolution was seven Directors and four Audit & Supervisory Board Members.
5. The maximum amount for Directors’ bonuses approved at the 93rd Annual General Meeting of Shareholders held on June 28, 2007 is 60 million yen per year
(not including the portion of employee bonuses for Directors who are concurrently working as employees); the number of recipient executives at the time of
the resolution was seven Directors.

6. The Company abolished the executive retirement benefits system for Directors and Audit & Supervisory Board Members at the conclusion of the 93rd Annual
General Meeting of Shareholders held on June 28, 2007.

Risk management
conducted and held during FY2022.
Additionally, to prepare for unforeseen circumstancessuch as fires and problems with equipment, we
implement incident countermeasures such as
strengthening equipment inspections and monitoring
systems, and also promote measures to prevent fires
from spreading in order to mitigate fire damage.
Furthermore, we are working to strengthen and revise
our stable supply system, for example by arranging
supplemental shipments from our business locations,
namely the Sodegaura Distribution Center, whichhouses our stockpile of limestone.

Quality assurance
We recognize the stable supply of raw materials andproducts as a material issue, and all Group employees
are committed to quality assurance and quality control
to ensure that no non-conforming or defective
products are provided to customers.
We have formulated Quality Assurance Guidelines andhold regular meetings of the Quality AssuranceCommittee to identify and evaluate risks associatedwith the products we provide and discuss measures toaddress the risks, all with the aim of further
strengthening our quality assurance system.
To prevent scandals stemming from falsification of
inspection and test data and other quality issues, ourinternal audits include quality assurance and quality

41

Integrated Report 2023

guidelines such as the Cybersecurity Management
Guidelines published by the Ministry of Economy, Tradeand Industry.

(1) Defense against external threats

Cybersecurity threats are increasing and expanding as more and more business is conducted online.
We are considering steps to transition the telecommuting environment we hurriedly created for the pandemic into an
enhanced environment for full-scale operations to improve working environments and as a BCP measure.
We are revising rules and issuing alerts on how to safely use external cloud services, generative AI, and other new
technologies.
We regularly conduct information security training and implement awareness-raising activities to counter phishing and new threats.

(2) Protecting personal information

We have established internal rules for protecting personal information and strive to prevent personal information leaks.

(3) Protecting confidential information

We strictly control access to information assets and conduct information security training to prevent information leaks.

(4) Information security risk assessment and countermeasures

Business continuity
Limestone accounts for 17.6% of the Group’s sales(FY2022 actual), and roughly half of ours is produced at
the Torigatayama Quarry Complex; an earthquake orother natural disaster at the complex could have asubstantial impact on our business continuity.
In response to these types of risks, we haveformulated a business continuity plan (BCP) to prepare
for earthquakes and other natural disasters and also
discuss revisions to the plan based on risks and otherinformation identified in the interim, for example during
the two safety status confirmation drills and fourbusiness continuity management (BCM) meetings

IT is part of our management infrastructure, and we
regard cybersecurity risk as a management risk. In
addition to other risk management initiatives, we are
implementing the following measures to comply with

control components, and the results are reported andshared at Quality Assurance Committee meetings.
In FY2022, we established a contact point for quality
assurance so that even employees who are not directly
involved with the Group’s products can conduct quality
improvement activities, and held two Quality AssuranceCommittee meetings at which studies of the status ofquality control at each business location, activities of
the Quality Risk Management Subcommittee, and otherinformation was reported.

As part of our information security efforts, we conduct risk assessments at all of our business locations and Group
companies to check whether information assets are being handled appropriately.
Any risks identified are prioritized and addressed in due order.

Additionally, in FY2022, we conducted an e-learning program to enhance employees’ knowledge of information
security, and 782 employees participated.

Compliance

We are establishing a compliance system for theentire Group in accordance with the Nittetsu Mining
Group Code of Conduct in addition to establishing andapplying internal controls for financial reporting toensure the reliability thereof and comply withaccounting standards.
Furthermore, our Internal Audit Office, which is
independent of executive departments, is taking the(1) Internal audits

lead in conducting internal audits of the head office,business locations, branch offices, and affiliatecompanies in Japan as well as overseas affiliatecompanies in addition to developing and operatinginternal controls over financial reporting, thereby
strengthening and expanding the Group’s compliancesystems and internal controls.

Our Internal Audit Office strengthens the monitoring functionsof the entire Group by conducting internal audits of compliance,internal control status, and accounting operations.
Additionally, we enhance the effectiveness of internal audits
by ensuring dual reporting lines to the President and the Audit
and Supervisory Committee, and facilitate corrections to
individual business operations by making internal audit results
available to all executives and relevant departments.

Number of locations where internal audits were conducted(Locations)

25
20

19
16

15

13

10
5
0

FY2020

FY2021

FY2022NITTETSU MINING

42

GovernanceCorporate Governance(2) Overview of the internal reporting system

We have established contact points both internally and within
an outside law firm to allow Group employees and others tomake reports or seek consultation when an act that violates
laws, regulations, or the like has been or may be committed.
In response to these reports and requests for consultation,
the Internal Audit Office takes steps to resolve the issues after
giving due consideration to protecting the privacy of theinformants and ensuring that they will not be treated unfairly.
Whenever action is taken in response to a report, the Internal
Audit Office gives a report at the very next meeting of the Boardof Directors in addition to reporting the results for the fiscal
year at the final meeting of the Board of Directors that year.
Notably, in FY2022, there were no cases of legal action due tobribery, corruption, or the like.
We will continue to operate the internal reporting contact
points appropriately to prevent violations and detect them assoon as possible.

(3) Compliance training

We regularly hold training sessions to maintain and improve
the awareness of compliance among executives andemployees.
In FY2022, in addition to training sessions for employees on
information security and the internal reporting system, we
invited outside lecturers to lead training sessions on risk
management for executives and head office general managers
and section managers and Antimonopoly Act for head office
departments and salespeople from affiliate companies.

Number of internal reports and serious violationsof laws and regulations

Cross-shareholdings (exchange-listed shares excluding
presumptive holdings) through the years(Incidents)(Billionsof yen)Number of internal reports

Number of serious violations of laws and regulations

10

3

15

3

2
0

0

0

FY2020

FY2021

0

5

FY20220Integrated Report 2023

60

15
55

2018

2019

54

2020

45

2021

42

2022

(Numberof shares)

120

Sale amount (left axis)
Number of shares sold (right axis)(Billionsof yen)

2.4

100

2

80

1.6

60

1.2

40

0.8

20

0.4

0

0

(Numberof shares)

2

13

15
12

9

9

1

0.1
2018

2019

5

0.7

4

4

1
2020

18

2021

2022

6

0.2
Aug. 2023

30* FY2023 results as of end of August 2023

Number of participants in compliance training (total)(Persons)

125

100

100

112

75
50
25
0

25

FY2020

FY2021

Dialogue with shareholders and investors
We strive to create positive opportunities and engage
in constructive dialogue with our shareholders andinvestors to the extent we deem reasonable in order tocontribute to our sustainable growth and enhancementof corporate value over the medium and long term.
The development and operation of a system for
dialogue with shareholders and investors is

implemented under the supervision of the Director
responsible for the General Administration Department
either by that Director or a person appointed by that
Director based on the wishes or concerns ofshareholders and investors.

FY2022

Policy for cross-shareholdings

43

23

10

1

Note: Only training hosted by the Internal Audit Office of the head office

We hold shares deemed necessary in terms ofbusiness strategy in pursuit of sustained growth andimproving our corporate value over the medium to longterm.
The Board of Directors examines the purpose andeconomic rationality of individual cross-shareholdings
each year, and when they reach the conclusion that
there is little reason to continue holding certain shares,
we initiate a dialogue with the investee company enroute to selling the shares.
Our policy is to reduce our cross-shareholdings by
6,000 million yen (based on the market value at
end-March 2022) over the five-year period fromFY2022 to FY2026 to raise capital for investments
toward carbon neutrality as well as other environmental

27.8

25

24.1

20

6
4

30
25

8

Amount listed on year-end balance sheet (left axis)
Number of shares (right axis)

Actual sales of cross-shareholdings (exchange-listed shares)*and growth investments.
In FY2022, we disposed of holdings in four shares
totaling 2,000 million yen (the same amount as themarket value at end of March 2022). So far in FY2023,
we have disposed of holdings in five shares totaling
200 million yen (the same amount as the market value
at end of March 2022) and will continue to reduce thenumber of shares held.
We will exercise our right to vote on crossshareholdings appropriately; our criteria are whether
the holdings will improve the corporate value of theCompany and portfolio companies over the medium tolong term and whether our reasons for holding theshares remain valid.

Overview of shareholders and investors with whom we have had dialogue
We make no distinction in our dialogue based on whether shareholders or investors are Japanese or non-Japanese,
their investment style, their areas of responsibility, or other attributes. Additionally, in an effort to properly understandour shareholders, we conduct a semiannual survey to identify substantial shareholders and use the results as
reference information for dialogue.

Main topics of dialogue and concerns of shareholders and investors
Business results for the current fiscal year and outlook for the next fiscal year, the progress of the Medium-Term
Management Plan, Shareholder Return Policy, efforts to reduce cross-shareholdings, ESG/SDG initiatives, initiatives toimprove return on capital and share price, etc.

Feedback to management and the Board of Directors
In addition to Q&A during dialogue with shareholders and investors, weshare any views and requests we are aware of with the Representative
Director and all other executives (including outside executives) in reports
prepared for each instance of dialogue.

Number of individual meetings
with investors and others(Meetings)
FY202018

FY202123

FY202228

NITTETSU MINING

44

GovernanceCorporate Governance

I N T E R V I E W

Eiki Hotta
Outside Director (Audit and Supervisory Committee Member)

Please tell us a bit about your past experience.
And based on that experience, what is foremost in
your mind when meeting with the Board of
Directors?
I have never worked for a company—I entered theTokyo Institute of Technology at the age of 18, went on
to graduate school, became a faculty member, andremained active at the university until I retired at theage of 65. My background is in electrical engineeringwith specialties in high-voltage and discharge plasmaengineering, so the operating principles of theCompany’s PLASMA DASH are within my area ofexpertise.
Although I only have experience at one university, I
served as an elected councilor for the graduate
program and was involved in the administration of that
program as deputy dean and also served as
department chair. As director of the Student Guidance
Room, I tackled the challenge of resolving problems not
only between students but also between advisors andtheir students.
Outside of the university, I took on quite a bit of work
for academic societies, for example serving on boards
and organizing committees for national andinternational conferences. I have also sat on review
boards for other universities and accepted part-time
lecturer and visiting professor positions. I have alsopresented at international conferences and maderepeated short-term visits each year to the Harbin
Institute of Technology in China and the Czech
Technical University in Prague to conduct joint
research.
The director of a laboratory is like the manager of asmall business—in managing the laboratory, you musttake care of the overall management plan, including
selecting research topics that match the interests andexperience of the students under supervision,
assigning personnel, and securing funds for laboratory
operations and research.
Before becoming a Director at Nittetsu Mining this45

Integrated Report 2023

year, I spent some time as an Audit & Supervisory
Board Member. While some of the explanations I
receive at the sites I visit involve matters not too far
from my specialties or general topics such as safety
management, many are beyond my expertise. As in
research, it can be interesting to consider things you
have not yet studied, so my approach is to consult withexperts when I am in unfamiliar territory. In these cases,
I try to be constructive with my opinions, and this is also
true at Board meetings.
From your perspective as an Outside Director,
how do you view our Board of Directors?

We have begun evaluating the effectiveness of theBoard of Directors through questionnaire-based
self-assessments. The results illustrate the need forongoing efforts to ensure opportunities for the free,open-minded exchange of opinions as well as genderand other forms of diversity. One initiative we are taking
toward that end is off-the-record offsite meetings westarted holding after Board meetings last year. For
several years now, all outside executives have enjoyedopportunities to participate and express their opinionsat Management Council meetings. We also receive
explanations of important agenda items in advance, aneffort the evaluations recognized as increasing
opportunities for exchanging opinions.
However, regarding diversity, a female Outside
Director was appointed just last year, and awareness ofthe need to develop women in key positions is stillrather fresh, so it seems like it will take some time
before female employees who have spent their entire
careers with the Company can be appointed as
Directors.
Given the age distribution, there are currently noyoung Directors, either. The overall decisions for theCompany by the Board are considered by all Directors,
so it should be possible to develop young Directors
who are considered experts in their fields.

We became a company with an Audit andSupervisory Committee after the Annual General
Meeting of Shareholders in June 2023. What isyour opinion regarding this change in the designof the organization?
Around the time that discussions about transitioning
to a company with an Audit and Supervisory Committee
began to emerge, a briefing session led by experts washeld to help us understand the differences between acompany with an Audit and Supervisory Board and acompany with an Audit and Supervisory Committee. I
was shocked to learn that foreign investors and others
hold companies with Audit and Supervisory
Committees in high regard, but do not regard JapaneseAudit and Supervisory Boards highly at all. My primaryconcern was that when a company becomes acompany with an Audit and Supervisory Committee, its
Audit and Supervisory Committee Members also
become Directors, so you end up self-auditing, so to
speak. In other words, I worried that our governancefunctions would suffer and doubted whether we could
guarantee the effectiveness of audits under the newformat. Later, when I looked into the advantages ofcompanies with Audit and Supervisory Committees, I
learned, among other things, that Audit and Supervisory
Committee Members have voting rights on the Board of
Directors, which leads to stronger supervision, and thatthe Board can delegate important business decisions
to the Directors through the articles of incorporationand other means, which allows the Board to operate
more flexibly.
Most of my concerns have been allayed by the factthat the Company’s Audit and Supervisory Committee
rules contain bylaws for elected Audit and Supervisory
Committee Members, which give them the same
auditing functions as before even though they are now
Audit and Supervisory Committee Members rather than
Audit & Supervisory Board Members, and also lead tostronger supervision. In the future, I think we should
consider systematic audits using the internal control
system to improve the efficiency of audit functions.
Concurrent with our transition to a company with
an Audit and Supervisory Committee, weannounced that we would introduce a share-based
remuneration plan for executives. What do you
think about the plan?
We now provide performance-linked remuneration to
executives who are not Outside Directors or Audit &Supervisory Board Members in addition to the fixed
remuneration provided to date. On this occasion, atrust has been established for the new share-based
remuneration plan. Since share-based remuneration ispaid when an executive leaves the Company, it isequivalent to an evaluation of medium- to long-term
performance and thus acts as an incentive for the

executive to perform their duties. This is why I think it
will be beneficial in multiple areas, for example indiscussions about what to do when the P/B ratio falls
below 1x.
What issues are you addressing to ensuresustainable growth of the Company? What do you
expect from the Company?

Nittetsu Mining launched the Sustainability Committee
last April and pledged to make further efforts to resolve
environmental and social issues. As a further measure
to help counteract global warming, the Company has
published a roadmap to achieve carbon neutrality by
FY2050 and is working to resolve issues accordingly.
The members of the Sustainability Committee
frequently report the results of their surveys andinvestigations as well as specific recommendations. I
commend them for their meticulous consideration andam waiting to hear about their future activities withgreat interest. The R&D Department is investigating andresearching how to generate hydrogen fromwastewater and carbon dioxide fixation technologies,
and I look forward to the results.
Vast quantities of high-quality copper materials are
essential to increasing the use of electric vehicles andtransporting renewable energy to combat global
warming. One of the Company’s main businesses iscopper mining operations in the Republic of Chile.
Resource development from exploration to extraction
takes a lot of time, so up-front investments must be
on-target and aggressive. Regarding the developmentof the Arqueros Mine in Chile, the Company hasentered a phase where full-scale operations are insight. Overseas projects involving mineral resources
other than copper are also being considered, and I
have high expectations for the execution of theCompany’s plans for the development and stablesupply of resources, its core mission.
In closing, do you have anything you would like tosay to our shareholders?
In Europe and the US, there seems to be a strong
belief that companies belong to their shareholders, but
in Japan, business partners and employees are seen as
important stakeholders alongside shareholders. As an
Independent Outside Director, it is my intention torespect shareholders’ opinions while giving due
consideration to overall balance and aiming for flexible
and sound corporate management. I sincerely
appreciate the understanding and support I’ve received
from the Company’s shareholders and hope I can counton it in the future as well.

NITTETSU MINING

46

GovernanceCorporate Governance

Board Members(as of September 30, 2023)

Directors (excluding those who are Audit and Supervisory Committee Members)
Representative Director and President

Director and Corporate Executive

Director

Outside Director

Apr.
1986
June
2012
June
2015

Apr.
1984
Oct.
2011
June
2015
June
2017
Apr.
2019
June
2019
July
2022

Apr.
1986

Joined the Company

Apr.
1995

June
2016

Managing Director of Hachinohe
Mining Co., Ltd.

Reiichi Morikawa

Apr.
2017
June
2017
Oct.
2017
June
2019
Apr.
2021

Joined the Company

General Manager of Limestone &Raw Materials Sales Department
Corporate Executive and General
Manager of Limestone & Raw
Materials Sales Department
Director and President of Sociedad
Contractual Minera Atacama Kozan
Director, Responsible for Non-Ferrous Metal& Ore Department, and General Manager ofLimestone & Raw Materials Sales Department
Director, Responsible for Limestone &Raw Materials Sales Department and
Non-Ferrous Metal & Ore Department
Managing Director, Responsible forLimestone & Raw Materials Sales
Department and Non-Ferrous Metal& Ore Department
Representative Director andPresident (current position)

Apr.
2023
June
2023

Joined the Company

Director and Deputy President of Sociedad
Contractual Minera Atacama Kozan
General Manager of Resources
Development Department
Corporate Executive and General Manager
of Resources Development Department
Director and President of Sociedad
Contractual Minera Atacama Kozan
Director, Responsible for Resources
Development Department
Director, Responsible for Resources
Development Department and Overseas
Mineral Resources Business Department
Director, Responsible for Mining Department,
Resources Development Department,
Overseas Mineral Resources Business
Department, and Safety Administration OfficeDirector and Corporate Executive, Responsible for
Resources Development Department and Overseas
Mineral Resources Business Department (current position)

Seiji Yasuda
June
2013

General Manager of General
Accounting Department

June
2019

Standing Audit & Supervisory Board
Member of the Company

June
2023

Director(Standing Audit and Supervisory
Committee Member) (current
position)

Director and Corporate Executive

Outside Director

Apr.
1987
June
2014
June
2017
June
2019

Apr.
1986
June
2013
June
2016
June
2017
June
2019
June
2021

Apr.
1994

Registered as Attorney-at-Law
Joined Shigetaka Arai Law Office

Apr.
2004

Joined Litigation Department,
Tokyo Legal Affairs Bureau, Ministryof Justice

June
2021
Apr.
2023
June
2023

Joined the Company

General Manager of General
Administration Department
Corporate Executive and General Manager
of General Administration Department
Director, Responsible for General
Administration Department, General
Accounting Department and BusinessContinuity Management OfficeDirector, Responsible for General
Administration Department and BusinessContinuity Management OfficeDirector, Responsible for General
Administration Department, Human
Resources Department, and BusinessContinuity Management OfficeDirector and Corporate Executive,
Responsible for General
Administration Department, Human
Resources Department, andBusiness Continuity Management
Office (current position)

Kenji Otakara

Apr.
2022

June
2023

Joined the Company

General Manager of Non-Ferrous
Metal & Ore Department
General Manager of General
Accounting Department
Corporate Executive and General Manager
of General Accounting Department
Corporate Executive and General
Manager of Osaka Branch OfficeDirector, Responsible for General
Accounting Department, Limestone &Raw Materials Sales Department and
Non-Ferrous Metal & Ore Department
Director, Responsible for Corporate
Planning Department, General
Accounting Department, Limestone &Raw Materials Sales Department and
Non-Ferrous Metal & Ore Department
Director and Corporate Executive,
Responsible for Corporate Planning
Department, General Accounting
Department, and Non-Ferrous Metal& Ore Department (current position)

Eiki Hotta

Apr.
2016
June
2017
June
2023

Professor of Interdisciplinary
Graduate School of Science &Engineering, Tokyo Institute ofTechnology
Emeritus Professor of Tokyo
Institute of Technology

Audit & Supervisory Board Memberof the Company
Director of the Company(Audit and Supervisory Committee
Member) (current position)

Yuko Aoki
Apr.
1999

Apr.
2009
Apr.
2021
June
2022
June
2023

Joined Aoki Law Office

Joined Shin-Yotsuya Law Offices(current position)
Vice Chairman, Daini Tokyo Bar
Association
Managing Director, Japan
Federation of Bar Associations
Director of the Company

Director of the Company(Audit and Supervisory Committee
Member) (current position)

Outside Director

Outside Director

Corporate Executives

Apr.
1977
Mar.
2011
Mar.
2012

Apr.
2002

Corporate Executive Research & Development Department

Masanobu Kawata

Corporate Executive Responsible for Limestone & Raw Materials Sales Department

Hiroyuki Sakaguchi

Nobumichi Izumi

Mar.
2013

Mar.
2015
June
2015
Mar.
2018
June
2019

Integrated Report 2023

Yukihiko Hagikami

Director and Corporate Executive

Hirofumi Fujimoto47

Directors who are Audit and Supervisory Committee Members

Joined Nikkei Inc.

Executive Officer and Managing Editorof Osaka Head Office, Nikkei Inc.
Managing Executive Officer andManaging Editor of Osaka Head
Office, Nikkei Inc.
Senior Managing Executive Officer
and Representative Manager ofNagoya Branch, Nikkei Inc.
Director of Nikkei Nagoya
Newspaper Printing Center, Inc.
Advisor of Nikkei Inc.
Executive Research Director of Japan
Center for Economic Research
Honorary Member of Nikkei Inc.
Director of the Company (current
position)

Kenichi Itakura
Apr.
2004
Apr.
2012
Aug.
2012
Oct.
2016
Apr.
2019
May
2019
June
2021

Professor, Department ofInformation and Electronic
Engineering, Muroran Institute ofTechnology
Vice President, Muroran Institute ofTechnology
Director, Center of Environmental Scienceand Disaster Migration for Advanced
Research, Muroran Institute of Technology
Director, Mikasa Potential Coal
Energy Research Facility, MuroranInstitute of Technology
Director, Mikasa Underground
Gasification Coal Mine, MuroranInstitute of Technology
Specially Appointed Professor,
Graduate School, Division ofEngineering, Muroran Institute ofTechnology (current position)
Emeritus Professor of MuroranInstitute of Technology
Director of the Company (current
position)

Responsible for Machinery & Environmental Sales Department andResponsible for Mining Department and Safety Administration Office,Ken Soda

Corporate Executive Manager of Business Continuity Management Office

General Manager of General Administration Department, General

Tsutomu Nomura

Corporate Executive General Manager of Torigatayama Quarry Complex

Tomohiro Saito

Corporate Executive and General Manager of Mining Department

NITTETSU MINING

48

Consolidated Financial Indicators Through the Years
FY2013

FY2014FY2015FY2016FY2017FY2018FY2019FY2020

FY2021

FY2022

Net sales(Millions of yen)

114,317

125,467

114,088

107,325

118,709

123,372

117,502

119,159

149,082

164,020

Operating profit(Millions of yen)

9,517

10,232

10,090

8,026

8,741

7,479

7,576

8,726

15,715

13,632

Ordinary profit(Millions of yen)

8,957

9,613

9,723

7,474

8,779

7,356

8,012

9,629

16,605

13,204

Profit attributable to owners ofparent(Millions of yen)

3,903

5,973

4,483

7,289

4,877

5,360

4,518

3,746

9,279

9,780

Capital investment(Millions of yen)

6,850

7,855

6,240

6,465

5,165

8,044

8,825

7,461

9,577

8,572

Depreciation(Millions of yen)

5,358

5,927

6,623

5,875

5,433

5,547

5,316

5,302

5,426

5,485

Research & development
expenses(Millions of yen)

565

551

580

617

634

702

696

672

750

823

Net assets(Millions of yen)

84,75592,46690,850102,399

106,164

107,186

105,208

116,411

126,371

139,410

Total assets(Millions of yen)

161,325

170,055

162,379

167,496

172,431

171,717173,954

188,735

197,732

208,335

Equity capital(Millions of yen)

81,591

89,21987,472

98,042

101,534

102,656

100,060

111,075

120,073

132,345

Earnings per share*(Yen)

234.44358.77269.33437.92293.06322.12271.58225.19557.73587.89Dividend per share*

(Yen)

42.50

35.00

40.00

40.00

45.00

55.00

45.00

50.00

167.50177.50ROA (operating profit)

(%)

6.2

6.2

6.1

4.9

5.1

4.3

4.4

4.8

8.1

6.7

ROE

(%)

5.0

7.0

5.1

7.9

4.9

5.3

4.5

3.5

8.0

7.7

(Millions of yen)

14,876

16,16016,713

13,901

14,174

13,027

12,892

14,02921,141

19,117

(%)

50.6

52.5

53.9

58.5

58.9

59.8

57.5

58.9

60.7

63.5

Cash flows from operating
activities(Millions of yen)

5,742

19,811

11,07012,07912,161

13,465

9,242

9,414

8,539

15,818Cash flows from investing
activities(Millions of yen)

(10,186)(4,289)(4,993)(6,070)(4,611)(6,077)(7,714)(6,539)(7,256)(5,507)

Cash flows from financing
activities(Millions of yen)

0(3,832)(3,675)(6,194)(3,089)(4,025)(1,454)(999)(4,759)(4,920)

(%)

18.1

9.8

14.9

9.1

15.4

17.1

16.6

22.2

30.0

30.2

(Persons)

1,781

1,787

1,756

1,771

1,784

1,836

1,882

1,941

2,019

2,127

EBITDA
Capital adequacy ratio

Payout ratio
Number of employees(consolidated)* The Company implemented a 10-to-1 consolidation of common shares that took effect on October 1, 2016 and a 2-for-1 split of common shares that took effect on October 1, 2022.
Accordingly, per-share data on this page was calculated as though the consolidation and split were conducted at the beginning of FY2013.

49

Integrated Report 2023

NITTETSU MINING

50

Consolidated Financial Statements (Condensed)
Consolidated balance sheets(Millions of yen)

FY2021

Consolidated statements of income

FY2022

Assets(Millions of yen)

FY2021

FY2022

Net sales

149,082

164,020

Current assets

89,705

94,178

Cost of sales

114,217129,038

Non-current assets

108,027

114,156

Gross profit

34,86434,981

Property, plant and equipment

67,11770,276

Selling, general and administrative expenses

19,14921,349Intangible assets

3,608

4,046

Operating profit

15,715

13,632

Investments and other assets

37,301

39,833Non-operating income

1,561

1,810

197,732

208,335

Non-operating expenses

671

2,238

16,605

13,204

Total assets
Liabilities

Ordinary profit

Current liabilities

46,93848,258Extraordinary income

191

1,726

Non-current liabilities

24,422

20,666Extraordinary losses

493

751

Total liabilities

71,36068,924

Profit before income taxes

16,304

14,179

Income taxes - current

5,082

3,356

Income taxes - deferred

27

(191)

Net assets

108,145

114,976

Capital stock

4,176

4,176

Total income taxes

5,110

3,164

Capital surplus

4,746

4,584

Profit11,193

11,015Retained earnings

99,391

106,385

Profit attributable to non-controlling interests

1,914

1,234

(169)

(170)

Profit attributable to owners of parent

9,279

9,780

11,92817,368

11,97414,149

(778)

(180)

Foreign currency translation adjustment

808

1,937

Remeasurements of defined benefit plans

(75)

1,463

6,297

7,065

126,371

139,410

197,732

208,335

Shareholders’ equity

Treasury stock
Accumulated other comprehensive income
Valuation difference on available-for-sale securities
Deferred gains or losses on hedges

Non-controlling interests
Total net assets
Total liabilities and net assets

Consolidated statements of comprehensive income(Millions of yen)

FY2021

FY2022

Profit11,193

11,015

Other comprehensive income

1,727

5,843

Valuation difference on available-for-sale securities

987

2,176

Deferred gains or losses on hedges

(858)

598

Foreign currency translation adjustment

1,034

1,540

Remeasurements of defined benefit plans

564

1,529

12,921

16,859Comprehensive income attributable to owners of parent

10,723

15,220Comprehensive income attributable to non-controllinginterests

2,197

1,638

Comprehensive income
Comprehensive income attributable to51

Integrated Report 2023

NITTETSU MINING

52

Non-Financial Highlights
Total limestone production (consolidated)(Thousandtons)

30,00025,64925,000

Copper concentrate(Thousand
tons)

50

24,43524,38021,74423,231

20,000

2018

2019

2020

2021

2022

0

7

(Thousand
tons)

11

12

12

12

13

200

202

206

202

216

217

2019

2020

2021

2022

0

2018

17

2020

2021

0

2022

Number of days of paid leave/percentage
of leave taken (Nittetsu Mining)
Number of days of paid leave (left axis)

15

2,500

1,937

1,808

1,845

1,754

12.2

12

Percentage of paid leave taken (right axis)

13.0
69.0

12.9
10.4

12.0

68.2
64.1

64.7

(%)

50

80

40

60

30

1,000

6

40

20

50

500

3

20

10

0

0

0

0

0

2021

2022

(Thousand
MWh)

250
200

192

187

210

195

2019

2020

2021

2022

CO₂ emissions (consolidated; domestic)(Thousand
tons)

300

198

2018

266
239

250

258
236

Men

0

10

2019

2020

2021

2022

Note: Electricity generated under renewable energy projects
Solar power and small-scale hydropower: Total electricity sold;
Geothermal power: Converted to available electric energy from steam supply

Integrated Report 2023

0

2020

2021

2022

Women

13
2018

2019

2020

2021

2022

12

(%)

34.3

21.7

10.7
2018

19.6

7.7
2019

2020

2021

2022

Employment rate of people withdisabilities (Nittetsu Mining)

3.0

18.6

18.7

19.2

18.5

18.1

13.0

12.7

13.7

14.0

13.6

2.57
2.5

2.32

2.27

2.31

2019

2020

2.37

2018

2019

2020

2021

2022

0

2.0

1.5

5

50

2018

14

15

100

50

2019

25

150
100

2018

Average continuous service (Nittetsu Mining)

20

200

150

55.1

(Years)

270

15

(%)

100

100

2020

14.4

16

Percentage of women hired (Nittetsu Mining)

9

2019

15.5

15.8

100

1,500

2018

15.5

16.1

Notes: 1. 1 or more days lost 2. Calendar year totals 3. Includes
employees of contractors working onsite(Days)

1,954

2019

19

500

200

1

20

18

300

3

710

678

670

669

654

400

4

1
2018

(%)

600

150

Sales volume of electricity generated fromrenewable energy (consolidated)

53

5

4

Total geothermal steam supplied (consolidated)

2,000

5

2

(Thousand
tons)

250

6

5

Note: Calendar year totals

Total sales of Polytetsu (consolidated)

700

8
6

Percentage of women (right axis)

800

9

40

10

5,000

Number of employees (left axis)(Persons)

10

44

20

10,000

Number of employees/percentage of women (Nittetsu Mining)(Accidents)

48

45

44

42

Number of industrial accidents involving
lost work time (consolidated; domestic)

Copper equivalent30

15,0000Total copper concentrate production (consolidated)

2018

2019

2020

2021

2022

1.0

2018

2021

2022

Note: Domestic (including Group companies) Scope 1 and Scope 2 emissions
calculated using emissions factors based on the Act on Promotion of Global
Warming Countermeasures

NITTETSU MINING

54

Corporate Profile
Company name

Investor FAQ(as of March 31, 2023)

Nittetsu Mining Co., Ltd.

Date ofestablishment

1

May 20, 1939

Representative

Reiichi Morikawa, Representative Director and President

Head officeYusen Building 6th floor, 3-2, Marunouchi 2-chome, Chiyoda-ku, Tokyo 100-8377 Japan

Business
description

Primarily mining (mining and distributing limestone, calcium carbonate, gravel, etc.) in addition to processing, distributing, importing,and exporting copper and other mineral products; purchasing and distributing coal and petroleum products; developing anddistributing products and equipment, including machinery and environment-related products; real estate; generating power using
renewable energy; etc.

Capital4,176 million yen

Number of
employees

Consolidated 2,127; Non-consolidated 710

List oflocations

List of Business Locations
https://www.nittetsukou.co.jp/eng/company/location/

Share Information(as of March 31, 2023)

Basic information
Securities code

1515

Stock exchange listings

Tokyo Stock Exchange Prime

Share unit

100 sharesBusiness type

Treasury shares

Authorized shares

40,000,000 shares

Outstanding shares

16,704,638 shares (including 67,976 shares of treasury stock)

Number of shareholders

6,076

Annual General Meeting of
Shareholders

Held in June every year

Fiscal year

Record date of shareholders
eligible for profit dividends

Shareholder registry administrator
Special account administrator

35.0

Distribution ofshareholdings byshareholder type(%)

March 31
March 31, and September 30 when paying aninterim dividend
Sumitomo Mitsui Trust Bank, Limited

23.4

Major shareholders
Number of shares held(Thousand shares)

Shareholding ratio(%)

NIPPON STEEL CORPORATION

2,475

14.88

Nittetsu Kogyo Shogakukai

1,282

7.71

The Master Trust Bank of Japan, Ltd. (trust account)
Mizuho Bank, Ltd.

1,504

Sumitomo Mitsui Banking Corporation

Custody Bank of Japan, Ltd. (trust account)

CEPLUX-THE INDEPENDENT UCITS PLATFORM 2
Nittetsu Kogyo Shareholding Association

STATE STREET BANK CLIENT OMNIBUS OM04
DFA INTL SMALL CAP VALUE PORTFOLIO

Notes: 1. Shareholding ratio is calculated excluding treasury stock (67,976 shares).
2. Shareholding ratios are rounded off to two decimal places.

55

Integrated Report 2023

588
580
414
367
350
330
296

Financial
institutions

22.7
Foreigncorporations

Note: The Company conducted a 2-for-1 share split of its common shares with a record
date of September 30, 2022 and an effective date of October 1, 2022

Name

17.5

Other
domestic
corporations

April 1 to March 31

Record date of Annual General
Meeting of Shareholders

Individuals/
other

0.4

Mining industry

9.04
3.54
3.49
2.49
2.21
2.11
1.99
1.78

We have always been conscious of our share priceand cost of capital, but as the TSE has requested, wemust continue to manage the Company with a greaterawareness of the cost of capital. We analyze the shareprice, P/B ratio, and other market valuations anddiscuss how to set targets for improvement and makeefforts that are sustainable rather than transitory.

2

List of Group Companies
https://www.nittetsukou.co.jp/eng/company/group/

Securities
companies

1.0

How do you intend to improve on
a P/B ratio of less than 1x?

How long can your limestone andcopper mines continue to be mined?

Reserves depend on the extraction method, theamount of ore mined, and exploration of surrounding
mining areas, so we can only estimate, but as of now,the Torigatayama Quarry Complex—our main limestonemine—has roughly 100 years left at the current volume,
the ATACAMA KOZAN Mine in Chile has roughly 10
years, and the Arqueros Mine in Chile, which is currently
under development, has roughly 15 years.

3

Why did you forecast a decline inoperating profit for the current
fiscal year?

In the Metallic Minerals Division of the Mineral
Resources Business, we expect a substantial decreasein both sales and income in response to the previous
year’s results due to a projected decline in sales ofcopper concentrates as well as external factors,
namely the rapid depreciation of the yen andfluctuation in copper prices. However, in theNonmetallic Minerals Division, we project both higher
sales and income because we expect to be able toreflect higher energy and material costs in our sales
prices with the understanding of our business partners.

4

Do you have any plans to disclose
Scope 3 emissions?

Regarding the Group’s Scope 3 emissions (supply
chain GHG emissions), we have begun to consider
reasonable calculation methods and procedures.
Although we cannot give a specific date for disclosure
at this stage, we plan to disclose the data as soon as
we have identified issues, set reduction targets, andmade other preparations.

5

In your view, what is the cost ofcapital?

For cost of capital, we use the weighted average costof capital (WACC). For cost of equity, we use the capital

asset pricing model (CAPM). We review our cost ofcapital and cost of equity annually; in FY2022, our
WACC was 5% and the CAPM yielded a cost of equityof 7%.

6

What is your business portfolio
strategy?

In terms of the story behind our establishment andour earnings, the Mineral Resources Business is ourmainstay, and is supported by the Machinery &Environmental Engineering Business, the Real EstateBusiness, and the Renewable Energy Business. While
the Machinery & Environmental Engineering Businessand the Renewable Energy Business are highly
compatible with sustainability and are expected to
grow in the direction of a decarbonized society, theReal Estate Business fulfills an important role as asource of stable earnings over the long term, a finecounter to the performance of the Mineral Resources
Business, which depends on external factors such as
demand and market prices for limestone, copper, andother mineral resources. Although the percentages ofmanagement resources invested may change in the
future due to changes in the business environment, we
will develop each segment in a well-balanced, efficientmanner to achieve sustainable growth.

7

Why has the development fund
for the Arqueros Mine increased
so much? Also, are there any
issues with profitability?

The main reason is that material prices have surged
since we acquired rights in 2017. However, anotherfactor is that indirect costs have increased because theconstruction schedule was extended from two to three
years after the detailed design was implemented.
Although the development fund has increased, copper
prices have also increased; this and other factors
highlight the overall economic rationality of theundertaking, and we have begun development
accordingly.

8What can you tell us about decarbonization
efforts in mining operations?

To achieve both decarbonization and economic
efficiency, we are seeking to streamline facilities andintroduce energy-saving technologies while looking
into constructing solar and wind power generation
facilities for internal consumption. We will continue topromote the decarbonization of heavy mining
equipment by closely monitoring trends intechnological innovation, including the shift to EVs,
synthetic fuels, and biofuels.

NITTETSU MINING

56