DENKA

To Our Shareholders

To Our Shareholders

As a chemical company, Denka is engaged in operations ranging from the provision of civil engineering and construction solutions to the manufacture of electric and electronic component materials and food packaging to the development of diagnostic reagents and other medical products. In 2015, we celebrated the centennial of our founding and changed our company name from DENKI KAGAKU KOGYO KABUSHIKI KAISHA to Denka Company Limited. In 2016, we established The Denka Value as our new corporate philosophy and “Taking on the challenge of expanding the possibilities of chemistry to create new value and contribute to sound social development” as the Denka Mission. This move was intended to clarify our foremost mission as a corporate group, namely, to contribute to the sustainable development of society in countries around the world.

“Denka Value-Up,” a new management plan slated to commence in fiscal 2018, identifies a threefold growth vision aimed at creating a “Specialty-Fusion Company,” securing “Sustained Growth” and achieving “Sound Growth.” To that end, our growth strategies are designed to focus our management resources on three fields, namely healthcare, the environment and energy, and infrastructure, with the aim of expanding our portfolio of specialty businesses. Moreover, to further these efforts, we will promote process reforms in production, R&D and all other operations, ensuring we achieve our numerical targets.

Denka is committed to sincerely addressing issues society is now confronting. Under the corporate slogan “Possibility of Chemistry,” we will tirelessly strive to contribute to social development through our business operations.

Representative Director, President Manabu Yamamoto

Shareholder Returns and Investment Plan
(Management Plan「Denka Value-Up」 / fiscal 2018~2022)

Following the completion of the Denka100 management plan, the final year of which is fiscal 2017, Denka will implement “Denka Value-Up,” a new management plan that will reinforce its operating base over a five-year course beginning in fiscal 2018 with the aim of enhancing corporate value and ensuring sustainable growth.
In line with our policy on shareholder returns as described below, we seek to steadily return profits yielded by initiatives executed under our management plan to shareholders while allocating a portion of such profits to such strategic investments as M&A for further growth. We will thereby strive to ensure our financial soundness in addition to maximizing shareholder returns and the resources available for forward-looking strategic investments.

Shareholder Returns

We aim to achieve a total shareholder return ratio of 50%.
(Total shareholder return ratio = (cash dividends + shares repurchased) / net income attributable to owners of the parent for the fiscal year)
In addition, we focus on maintaining the stable payment of cash dividends while flexibly carrying out share repurchases by giving due consideration to such factors as a trend in stock prices.

Investment Plan

We will invest a total of ¥200 billion over a five-year period.
Of this, strategic investment: ¥75 billion (¥15 billion/year)
M&A, etc.: ¥60 billion
Process reforms: ¥15 billion
Regular investment: ¥125 billion (¥25 billion/year)