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Corporate Business Plan

FY2016 - FY2018 Corporate Business Plan Presentation Meeting (March 8, 2016) Streaming Video

View streaming video (with audio) of presentation at Presentation Meeting

Sumitomo Chemical has formulated and is currently executing its Three-Year Corporate Business Plan for the period from fiscal 2016 to fiscal 2018. Under the slogan of “Change and Innovation—Create New Value,” the Company aims to achieve sustained growth by creating new value through innovative technologies. Capitalizing on its robust financial strength built under the previous Corporate Business Plan, the Company will aggressively pursue growth opportunities and further accelerate its transformation into a more resilient Sumitomo Chemical that continues to grow.

Overview of the Corporate Business Plan for FY2016 to FY2018

1. What Sumitomo Chemical strives to be

What Sumitomo Chemical strives to be

2. Basic policy

  1. (1) Further improve business portfolio
    Sumitomo Chemical will focus resources on the fields of environment and energy, ICT (Information and Communication Technology) and life sciences, where the Company can leverage its technological advantages, and deliver new value through innovative technologies to address issues facing society. While 400 billion yen is allocated for the investments planned on a sector-by-sector basis for the three-year period, an additional 300 billion yen is earmarked for investment in strategic M&A, as the Company seeks large-scale investment opportunities in the specialty chemicals area.
  2. (2) Generate more cash flow
    While retaining a lean financial structure, Sumitomo Chemical will build and maintain robust earnings power to consistently generate strong cash flow that allows the Company to take advantage of large-scale investment opportunities when they arise.
  3. (3) Accelerate the launch of next-generation businesses
    The Company will continue to invest in three priority areas of environment and energy, ICT, and life sciences, and accelerate the launch of its new products and technologies under development in these areas. In addition, it will strive to develop new solutions to issues in the fields where the priority areas intersect

In addition to the three points above, the Company will also work to: (4) Promote globally integrated management; and (5) Ensure full and strict compliance, and establish and maintain safe and stable operations.

3. Performance targets

Under the new Corporate Business Plan, the Company has set performance targets on a consolidated basis as follows:

  FY2018 targets FY2015 forecast
Net sales 2,540 2,250
Operating income 200 155
Ordinary income 210 170
Net income 110 80
  • *Assumptions for FY2016 to FY2018:Naphtha price: ¥45,000/kl
    Exchange rate: ¥120.0/US$

In the medium- to long-term, the Company aims to consistently achieve the following performance targets:

  Medium - to long-term targets FY2018 targets FY2015 forecast
ROE over 10% 12% 10%
ROI over 7% 7% 5%
D/E ratio approx. 0.7 times 0.6 - 0.7 times*2 0.7 times
Payout ratio approx. 30% undecided 29%
Profit growth*1 over 7% per year 11% per year -
  • ※1Compounded annual growth rate of net profit from the last year of the previous Corporate Business Plan
  • ※2Including the effects of investments in strategic M&A

FY2016 - FY2018 Three-Year Corporate Business Plan Presentation Meeting (March 8, 2016)