Mitsubishi Chemical Group (4188) Investor update summary

Vision and strategy for 2035

• KAITEKI Vision 35 targets wellbeing for people and the planet through green transformation, innovative materials, and solutions in five business areas: green chemicals, eco-conscious mobility, advanced data processing, food quality preservation, and new therapeutics.

• Identified five key social issues: energy use and decarbonization, sustainable resource management, digital technology advancement, food and water optimization, and healthy life expectancy.

• The strategy leverages both backcasting from 2050 societal issues and forecasting to enhance profitability and address urgent global challenges.

• Emphasized the need for a stable supply platform for green chemicals, circular economy, and carbon neutrality.

• Stressed the importance of connecting internal and external talent, technology, and manufacturing to drive innovation.

Medium-term management plan 2029

• Introduced a new five-year plan focusing on disciplined business selection, asset optimization, and rigorous investment criteria.

• Three criteria for business selection: alignment with vision, competitive advantage, and growth potential.

• Plan includes JPY 400 billion in rationalization and 30 projects by 2029, with no sacred areas for restructuring.

• Monthly reviews and strict funding discipline implemented to prevent cost overruns and ensure accountability.

• Specialty materials identified as a major growth driver, aiming to increase profit from JPY 34 billion to JPY 144 billion in five years.

Business portfolio and operational focus

• Portfolio transformation will quadruple core operating income in Chemicals by 2035, making it the highest-earning segment.

• Shift towards high value-added products in films, semiconductors, and food packaging, leveraging market leadership in key segments.

• Rationalization and consolidation of manufacturing sites, especially in engineering plastics and composites.

• Collaboration with Asahi Kasei and Mitsui Chemicals to enhance basic materials and polymers platform.

• Advanced films, composites, and specialty materials to undergo divestiture, consolidation, and targeted M&A for profitability.