Toray Industries (3402) Investor update summary

Review of current management program and achievements

• Revenue and core operating income are forecasted to rise, driven by strategic pricing and structural reforms, though targets were missed due to lower sales volumes in key segments.

• ROIC is expected to reach about 5% in FY 2025, but ROE will remain below target; Performance Chemicals saw the largest core operating income increase.

• Profit improvements were achieved through cost reductions, production structure reviews, and strategic pricing, notably at Zoltek and in PET Film business.

• All segments except Life Science saw improved core operating income and ROIC; Environment & Engineering led with 11% ROIC.

• Strategic pricing and the Darwin Project contributed to a 30 billion yen increase in profitability.

Long-term vision and management strategy

• TORAY VISION 2050 aims for harmony with the planet, shared prosperity, and health and comfort for all.

• The strategy integrates economic and social value creation, leveraging advanced materials, global value chains, and solution capabilities.

• Management materiality now fully aligns with strategy, focusing on decarbonization, recycling, air, semiconductors, mobility, healthcare, and comfort.

• Five long-term management policies address anticipated business environment changes, targeting a 10% ROIC by around 2035.

IGNITION 2028 medium-term management program

• IGNITION 2028 is the first execution phase toward the 2035 vision, focusing on reigniting growth and transforming the business structure.

• Quantitative targets for FY 2028 include raising ROIC to about 7%, ROE to 5-8%, revenue to JPY 2.6-3 trillion, and core operating income to 230 billion yen.

• Business segment realignment integrates Water Treatment & Healthcare with pharmaceuticals and medical products for strategic synergy.

• Emphasis on growth potential, strategic relevance, and resource allocation to high-growth fields, with a focus on quality and certainty of growth.