Creating for Tomorrow

Asahi Kasei Report 2015 Asahi Kasei Report 2015 Creating for Tomorrow 22015旭化成e_c_1029初修正.indd015旭化成e_c_1029初修正.indd 2 22015/11/06015/11/06 110:530:53 We, the Asahi Kasei Group, Group Mission contribute to life and living for people around the world. Group Providing new value to society by enabling “living in health and Vision comfort” and “harmony with the natural environment.” Sincerity—Being sincere with everyone. Group Values Challenge—Boldly taking challenges, continuously seeking change. Creativity—Creating new value through unity and synergy. Group Slogan Creating for Tomorrow Contents 2 To Our Stakeholders Research & Development 3 Return to Shareholders and Share Information 38 R&D at the Asahi Kasei Group 4 Feature: 40 R&D in Three Fields of Focus and Main Sites The Asahi Kasei Heritage of Diversifi cation for R&D 10 History of Providing Solutions for the Challenges of Society CSR 12 Financial and Non-Financial Highlights 42 CSR Dialogue 14 Asahi Kasei Group Management and CSR 44 Responsible Care 15 Interview with the President 52 Respect for Employee Individuality 20 CFO Interview 54 Corporate Citizenship Corporate Governance Financial Section 22 Directors, Corporate Auditors, Executive Offi cers 57 Financial Section 24 Outside Directors 58 Consolidated Eleven-Year Summary 26 Corporate Governance 60 Management’s Discussion and Analysis 66 Risk Analysis Operating Segments 68 Consolidated Financial Statements 30 Chemicals & Fibers 32 Homes & Construction Materials Corporate Information 34 Electronics 100 Major Subsidiaries and Affi liates 36 Health Care 102 Company Information 103 Investors Information Editorial policy Organizational scope For greater ease of understanding among our stakeholders, The scope of the report is Asahi Kasei Corp. and its consoli- since fi scal 2014 we are integrating information regarding dated subsidiaries, except with respect to Responsible Care, our business strategy and fi nancial performance, which had in which case the scope is operations in Japan that imple- been published in our Annual Report, with information ment the Asahi Kasei Group’s Responsible Care program. regarding our CSR activities, which had been published in Asahi Kasei’s four operating segments are Chemicals & our CSR Report, in a single Asahi Kasei Report. We hope Fibers, Homes & Construction Materials, Electronics, and that the Asahi Kasei Report will help you gain a clear per- Health Care. Unless otherwise specifi ed, the titles and posi- ception of the Asahi Kasei Group’s efforts toward sustain- tions of corporate offi cers and other personnel as shown in ability in society in addition to our management strategy, this report are current as of August 2015. business conditions, and management confi guration. Guidelines consulted Period under review The Global Reporting Initiative’s Sustainability Reporting The period under review is fi scal 2014 (April 2014 to Guidelines 3.1, ISO 26000, and other guidelines were con- March 2015). Some qualitative information pertaining to sulted during the preparation of this report. April to July 2015 has also been included. The forecasts and estimates shown in this report are dependent on a variety of assumptions and economic conditions. Plans and fi gures Disclaimer depicting the future do not imply a guarantee of actual outcome. Asahi Kasei Report 2015 1 To Our Stakeholders Thank you for reading the Asahi Kasei Report 2015. In 2014 ahead throughout all operations to achieve our targets. we integrated the description of fi nancial information, which With the start of a new management initiative from fi scal had been published in our Annual Report, with the 2016, we will adopt a new corporate confi guration with the description of our CSR activities, which had been published in three business sectors of Material, Homes, and Health Care, our CSR Report, in a single Asahi Kasei Report for greater and concurrently the holding company Asahi Kasei Corp. will ease of understanding by our various stakeholders. We hope become an operating holding company. We believe that that the Asahi Kasei Report will enhance your understanding these changes will foster greater synergies among our of the Asahi Kasei Group’s management strategy, business different sectors, enabling us accelerate innovation. We are operations, and fi nancial performance, as well as our focused on increasing corporate value through the contribution to the sustainability of society. continuous growth of operations with strategic and effi cient The Asahi Kasei Group is now executing “For Tomorrow management across the Asahi Kasei Group. 2015,” a fi ve-year strategic management initiative ending in Throughout these efforts, we will maintain proactive fi scal 2015. In accordance with our Group Mission of communication with our stakeholders to ensure transparency contributing to life and living for people around the world, through appropriate information disclosure. I would like to and our Group Vision of enabling living in health and comfort thank you for your continuous support. and harmony with the natural environment, we are expanding world-leading businesses and creating new value August 2015 for society. In fi scal 2014 we reached record highs for the second consecutive year in net sales, operating income, ordinary income, and net income, as investments for growth that we made over the past few years bore fruit. Also, in the fi eld of the Environment & Energy we decided to acquire the US-based Polypore International, Inc. to strategically expand Toshio Asano our battery separator business. As we complete our “For President Tomorrow 2015” initiative in fi scal 2015, we will press fi rmly 2 Asahi Kasei Report 2015 Return to Shareholders and Share Information We strive to continuously increase dividends through continuous earnings growth, with a payout ratio of 30% as our basic standard. Our basic policy is to strive to continuously increase dividends Dividends per share, payout ratio with a payout ratio of 30% of net income as our basic standard, (¥) (%) through continuous earnings growth while maintaining an 20 20 40 appropriate cash reserve based on consolidated fi nancial results. 19 35.1 36.4 Our cash reserve will be used as a source of funds required to 17 achieve future earnings growth by expanding operations, both 15 30 through investments in established businesses and through 14 14 25.5 26.4 strategic investments, including M&A, and new business 25.1 11 23.5 development expenditures in the environment & energy, 10 20 residential living, and health care as fi elds of strategic focus. In accordance with this policy, the annual dividend for fi scal 5 10 2014 was increased by ¥2 per share from the previous year to ¥19 per share. We plan to increase the dividend for fi scal 2015 to ¥20 per share refl ecting forecasted consolidated fi nancial results. 0 0 We will continue to strive for greater corporate value, and ’10 ’11 ’12 ’13 ’14 ’15 FY plan provide appropriate returns to our shareholders. Dividends per share (left scale) Payout ratio (right scale) Comparison between stock price and TOPIX (April 2011 = 1) Average stock price in Average stock price in Average stock price in Average stock price in (1,000 FY2011: ¥501 FY2012: ¥469 FY2013: ¥712 FY2014: ¥924 shares) 2.5 240,000 2.0 180,000 1.5 120,000 1.0 60,000 0.5. 0 April 2011 April 2012 April 2013 April 2014 Asahi Kasei stock price (left scale) TOPIX (left scale) Monthly total turnover (right scale) Number of shareholders (at fi scal year end) Shareholder distribution (at fi scal year end) Treasury stock 0.3% 120,000 116,237 114,772 Japanese securities companies 1.4% 109,298 Other Japanese companies 4.4% 100,000 97,906 (FY) Japanese individuals and groups 22.5% Japanese financial institutions Foreign investors 85,482 ’10 24.5% 80,000 46.9% ’11 60,000 ’12 40,000 ’13 20,000 ’14 41.1% 36.2% 16.7% 0 3.9% 1.7% ’10 ’11 ’12 ’13 ’14 FY 0.4% Asahi Kasei Report 2015 3 Feature The Asahi Kasei Heritage of Diversifi cation Since its founding in 1922, Asahi Kasei has proactively transformed its business portfolio to meet the changing needs of the times. We showcase three examples that highlight our heritage of taking on challenges and creating value by diversifying operations. Non-linear growth through strategic M&A In 2012 we acquired ZOLL Medical Corporation, a global leader in medical devices for 1 acute critical care, for US$2.2 billion (¥180 billion). While we had operated pharmaceutical and medical device businesses, this acquisition marked our strategic entry into the fi eld of critical care. Since that time ZOLL’s business growth—led by the LifeVest™ wearable defi brillator and expansion of the Core defi brillator business—has remained strong, and in fi scal 2014 our consolidated operating income in this business category turned positive even after amortization of goodwill and other intangible assets. The LifeVest™ was launched in Japan in April 2014, and further global growth is anticipated. Richard A. Packer, CEO of ZOLL 4 Asahi Kasei Report 2015 Accelerating ZOLL’s growth The third pillar of Health Care operations LifeVest™ wearable defi brillator Strategic entry into critical care • Will ZOLL, and particularly the Toward greater growth LifeVest™ product line, continue to Under the “For Tomorrow 2015” stra- grow? We are also impressed with ZOLL’s tegic management initiative ending in • What synergies will there be with strong track record of clinical develop- fi scal 2015, our main business strate- our existing Health Care businesses? ment not only in the US but also in gies are the expansion of world-leading • Is the acquisition price fair? countries around the world, and its businesses and the creation of new • Can we retain ZOLL’s talent? excellent capability in regulatory affairs value for society in three fi elds of • Is there compatibility with our cor- to obtain both product approval and focus, one of which is Health Care.

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