FY 2022-2025 Mid-term Business Plan
KAYAKU Vision 2025(KV25)

KV25 Net Sales and Operating Income Plan

KV25 Net Sales and Operating Income Plan

In FY2021, the final year of the Medium-term Business Plan KAYAKU Next Stage (FY2019—FY2021), we were unable to achieve our plan targets due to various external environmental impacts. However, we were able to achieve record high net sales of 184.8 billion yen.

In formulating the Medium-term Business Plan KV25, which began in FY2022, we created a roadmap for each of our businesses, based on which we then formulated the Medium-term Business Plan—in order to prevent the so-called “bird feather” phenomenon*1 in which planned net sales figures continue to decline when planning on a yearly basis.

In FY2022, profits will decline temporarily due to soaring raw material prices and increased costs due to the resumption of activities in the “With COVID-19” era. We plan to achieve net sales in excess of 200 billion yen in FY2023, and aim for net sales of 230 billion yen and operating income of 26.5 billion yen in FY2025*2. While this is not a low target by any means, we believe that it is a plan that can be achieved by proceeding according to the roadmap we have created.

For the period of this KV25 plan, we have set a total investment limit of 200 billion yen for R&D + capital investments + other investments, and will continue to make active investments looking ahead to FY2025 and beyond.

  • *1 The “bird feather” phenomenon: A term for the repeated downward revision of targets every time a business plan is reviewed.
  • *2 Business plan figures were announced publicly on May 13, 2022.

KV25 Company-wide Management Targets

Company-wide Management Targets

We established KPI for economic value and environmental and social value created as company-wide management targets in KV25, to pursue sustainable management.

The KPI targeted for economic value are ROE of 8% or higher by improving asset efficiency, in addition to net sales and operating income. We also incorporated return on invested capital (ROIC) as a management indicator, to increase asset efficiency by evaluating management of each division.

One of the KPIs targeted for environmental and social value is a 32.5% reduction in greenhouse gas emissions by 2030, compared to 2019, and achieving Scope 1 carbon neutrality by 2050 as a long-term goal.

We will also continue to create value from each division through building a digital society, creating a healthy society, continuing to protect lives, and supporting the supply of food as we work to increase customer satisfaction and build a framework for due diligence on human rights that includes the supply chain.

For our employees, whom we are closest to and value highly, we aim to increase employee satisfaction by establishing a work environment that makes it easy to work and provides job satisfaction, increasing the percentage of female managers, and implementing other initiatives to encourage diversity.

KV25 Business Portofolio

Business Portfolio (Main Investment Fields and Product Group) − KV25 Focus Area −

Business Portofolio

In order to achieve sustainable growth, the Nippon Kayaku Group has reviewed its portfolio of products from a medium- to long-term perspective. The aim of our business portfolio strategy is to clarify business domains in which the Group can leverage its strengths in markets with growth potential and prioritize the allocation of management resources.

We evaluate each product group within the three business units on the two axes of attractiveness of market growth and profitability and competitiveness, and classify them into four categories: “Important,” “Novel and future prospects,” “Foundation” and “Earning power amelioration.” We will create highly profitable businesses by concentrating investments in the “Important” and “Novel and future prospects” business categories, and allocate management resources in a balanced manner, such as operating the “Earning power amelioration” business fields while firmly controlling earnings.

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