1.COMMITMENT TO THE GROUP'S NEW MEDIUM-TERM PLAN "SAKAINNOVATION 2023"

Under "SAKAINNOVATION 2023," we will aim to improve our revenue in 6 major business areas, with 19 billion JPY as a strategic investment for that purpose, achieve the numerical targets of an operating profit of over 8 billion JPY and ROE of 6% or higher, and try to create a new image for the Sakai Chemical Group.

2.NUMERICAL TARGETS

The numerical targets for the final fiscal year (fiscal year ending March 2024) are as follows:

※1　We aimed the target of operating profit rate of 7% or higher, but we has been deleted from the target. Because the definition of sales will change due to the new revenue recognition standards applied from the fiscal year ending March 2022.

※2　We had planned a capital investment of 40 billion yen for five years, but we have reduced it to 31 billion yen by making a review of reconstruction investment.

3.EFFORTS FOR R&D AND CREATION OF NEW BUSINESSES AS A PART OF LOOKING AHEAD TO THE SOCIETY'S NEXT 10 YEARS

Under "SAKAINNOVATION 2023," we look ahead to the society's next 10 years and work on our continuous development goals.

1. Through the existing business, we will contribute to the society by creating environment- and human-friendly products.
2. Direction of R&D
   We will focus on 7 "Affordable and Clean Energy" and 9 "Industry,Innovation, and Infrastructure" in the sustainable development goals (SDGs) and continuously work on research themes in line with them.
3. Pursue the possibility of creating new businesses with the power of chemistry
   We will focus on 2 "Zero Hunger," 6 "Clean Water and Sanitation," 7 "Affordable and Clean Energy," 9 "Industry, Innovation, and Infrastructure," 13 "Climate Action," 14 "Life Below Water," and 15 "Life On Land" in the SDGs, and pursue the possibility for a new business model for the future.
4. Improve the factories, head office, and technology buildings to make them worker- and environment-friendly as well as resistant to disasters, and secure space for building factories in the future

4.EFFORTS MAINLY FOR THE EXISTING BUSINESS TO ACHIEVE ITS NUMERICAL TARGETS IN 5 YEARS

Under "SAKAINNOVATION 2023," we will focus on 6 major business areas to improve revenue.

1. Electronic material business
   Focus on developing and expanding the sales of materials mainly for MLCC (barium titanate, high purity barium carbonate, etc.). We plan to invest 5.7 billion JPY in MLCC-related business.
2. Titanium dioxide and zinc product business (cosmetics materials)
   We plan to expand the business of mainly cosmetic materials ( microfine titanium dioxide, ultrafine zinc oxide, etc.). We plan to invest 5.5 billion JPY in cosmetics-related business.
3. Plastic additive business
   In cooperation with overseas subsidiaries, we aim to set up the business of polyvinyl chloride resin stabilizers and hydrotalcite abroad, mainly in Southeast Asia, aiming at an overseas sales ratio of 50% or higher.
4. Catalyst business
   We plan to invest 1.3 billion JPY in catalyst-related business. We will focus on environment-friendly catalysts such as copper catalysts free of heavy metal chrome and polyester polymerization catalysts free of heavy metal antimony, and expand nickel catalysts.
5. Chemical and other businesses (high-refractive materials)
   We will develop and expand the sales of high-refractive materials (zirconium oxide dispersion, rutile type titanium dioxide dispersion) that showed increasing demand in the final year of the previous medium-term business plan (Fiscal Year 2018) and plan to invest 2.1 billion JPY.
6. Healthcare business
   We will actively expand our new businesses, mainly medical device business (submucosal injection material, endoscope washer-disinfector, bone void filler), products for cosmetic medical facilities, and cancer-screening business, aiming at an operating profit of 800 million JPY.