Investor Relations / Management InformationMessage from the President and CEO

I would like to thank our shareholders and investors for your continued support.

Since its foundation, Daicel Group has embraced the philosophy of “The company making lives better by co-creating value” and has been actively contributing to the creation of a sustainable society with our customers and partners.

For the fiscal year ended March 2025, the global economy showed a moderate recovery trend despite concerns such as the slowdown of China's economic growth, situation in Ukraine and the Middle East, rising inflation, and the impact of U.S. tariff policies, which led to an uncertain outlook. Amid these circumstances, our group's net sales increased due to an increase in sales volume by recovery trends in our major markets such as automotive and electronics sectors, as well as exchange rate fluctuations. However, operating income decreased by troubles at our carbon monoxide (CO) plant, increased depreciation costs, and losses associated with business restructuring, but EBITDA increased.

Regarding shareholder returns, we have maintained stable returns by setting targets of "DOE of 4% or more" and "total return ratio of 40% or more." As announced at the 1st half of fiscal year ended March 2025, the year-end dividend for this period is 30 yen per share, with an annual dividend increase of 10 yen from the previous fiscal year, totally 60 yen per share. We also implemented an acquisition of approximately 15 billion yen in treasury shares, resulting in a total return ratio of 63.1% for the fiscal year ended March 2025. Furthermore, we carried out the cancellation of 10 million shares of treasury stock in May 2025.

Looking ahead to the fiscal year ending March 2026, we plan to achieve an increase in sales volume by sales expansion across various businesses in response to rising demand, and an increase in production volume of Engineering Plastics as one of our Growth businesses. Although operating profit is expected to decrease due to factors such as increased depreciation and regular inspection costs, in addition to the impact of exchange rates, we expect higher income attributable to owners of parent and EPS growth by reduction in extraordinary losses which was charged in the last fiscal year due to business restructuring and continuous sell-off of cross-shareholdings.

Daicel Group, toward the realization of our Long-Term Vision for 2030, has outlined our specific initiatives and approaches within the Mid-Term Management Strategy “Accelerate 2025" to actively promote "business structure transformation" amid rapidly changing market conditions. Under the current Mid-Term Management Strategy, we have undertaken measures such as withdrawal of unprofitable businesses, reorganizing group structure through steps such as transition to a wholly owned subsidiary of Polyplastics and consolidation of Safety business production sites, and strengthening profitability of our business structure. We have also engaged in next-generation technologies and potential businesses by promoting production process conversion and development of new application of cellulose acetate, and research into technologies such as microfluidic devices with expectation of becoming innovative chemical process technology and nanodiamond catalysts. The upcoming Mid-Term Management Strategy, forming the second half towards realizing our Long-Term Vision, will focus on cultivating these businesses and reaping a harvest over the next five years. We aim to clarify exit strategies for medium and long-term research themes and ensure delivering measurable results. By targeting top-line growth and profitability improvement through an increase in production of our Growth businesses, while pursuing capital efficiency, we strive to develop a balanced and focused management approach that enhances corporate value, ensuring stable growth for our shareholders and investors.

We are grateful for and look forward to the continued support of our shareholders and investors.

June 2025

Yasuhiro Sakaki
President and CEO