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Medium-Term Management Plan

VISION 2030 Grand Design

New Medium-Term Management Plan “VISION 2030 Stage 2

（1）VISION2030 stage2 Plan

Basic Concept

To Be “Company of Choice Globally”, Advance Sustainable Business Foundation

Summary

Financial Goal

Accelerate High ROIC Business, Restructure Low-ROIC Business, Optimize Capital Structure, to Maximize Corporate Growth and Capital Efficiency

Non Financial Goal

Ensure CO2 Emission Reduction, Enhance Corporate Performance and Enterprise Value with Human Resource Empowerment

（2）Segment Business Strategies

1. Functional Solutions

Plastic Film：Utilize Capabilities of Recycle Technologies and Functional Solutions, Expand Resource Circulation Business Model around the World
Engineering Plastics：Increase Production Capacity with Factory Expansion, Strengthen Business in Semiconductor and Medial Markets

2. Medical Materials

Expand Market Share and Explore New Markets, Invent R&D and Manufacturing more, Success to Global Company

3.Apparel

Complete Restructuring Plan with no Exception Next 2 years (FY2025-2026), Execute Sustainable Business Turnaround to More Profitable

4.Lifestyle Creations

Appraise Profitability and Continuous Business Growth for Segments and Facilities, Implement Restructuring Plan to Facilities with GVA Deficit.

（3）Financial Strategies

Summary

Implement Restructuring, Capital and PER Improvement Planning, Achieve PBR ≥ 1.0 to Enhance Enterprise Value

Capital Planning

By Resource Allocation to Growth Investing and Shareholder’s Return, and Proactive Leveraging, Optimize Equity to Maximize ROIC and Maintain Financial Stability

（4）Sustainability Management（Human Capital Management）

Build Human Resources and Corporate Culture to Implement Corporate Strategy For Sustainable Enterprise Value and Competitiveness Enhancement

Please see below for the details

Medium-term Management Plan ＜stage2 of "VISION 2030"＞ (PDF:5.7MB)

New Medium-Term Management Plan “VISION 2030 Stage 1”

(1) Pivotal Strategies and Management Goals

Perception of Changes in the External Environment

Changes	Impact	New Normal	GUNZE’s movements
Changes in social / economic structures	・Diversifying work styles ・Expanding healthcare / nursing care markets ・Growing EC market	＜Living adapting to the COVID-19 situation＞・Changing consumer purchasing behavior 【Strong sectors】 EC, hygiene-related business, home meal replacements, etc. 【Sluggish sectors】 Retail, travel, eating out, sports club, etc. ・Accelerating work style reforms 【Offices】Downsizing offices, office relocations to local regions 【Work style】Teleworking becoming the normal	・Offering new products / services responsive to changes ・Promoting work styles suitable for the New Normal ・Creating added value through digital technology →Taking on the challenge of growth strategy and reinforcing corporate constitution
Advancing digital technology	・Rapid growth of businesses that protect against virus- related person-to- person contact ・Accelerated digital transformation
Heightened environmental awareness	・Increasing company commitment to “net-zero GHG emissions” by 2050 ・SDGs contribution trending ・Strengthened environmental regulations	＜Global trends＞・Accelerating ESG investments ・Accelerating efforts to realize a decarbonized society	・Implementing sustainable management →Enhancing customer satisfaction and corporate value

In addition to the above, our business environment is becoming more severe and insecurity is on the rise with soaring oil / raw material costs and the depreciating yen

4 Pivotal Strategies

Management Goals (Financial Goals)

2024 targets

Net Sales(100 million yen)：1,400　Opareting Income（100 millions of yen）：100　ROE（％）：6.3　over

※Plans by segment

Management Goals (Non-financial Goals)

Category	Target indicators		2024 targets	2030 targets
Environmental responsiveness	CO₂ emissions reduction rate (vs. FY2013, Scope 1＋2)		28％ or higher	35％ or higher
Environmental responsiveness	Per-unit energy consumption reduction rate (vs. previous year)		1％ / year or higher
Corporate constitution evolution	Promotion of women’s empowerment	Ratio of women in managerial roles	6％ or higher	20％ or higher
		Ratio of female employees in workforce	35％	41％
		Ratio of women hired in main career track	50％	50％
	Parenting support	Men’s paternity leave utilization rate	50％	70％
	Corporate culture creation	Engagement score	70pt. (estimate)	80pt. (estimate)
	Work style reform	Annual paid leave utilization rate	75％	100％
Others	Productivity improvement rate (P value) GUNZE’s own productivity metric over the previous year		103％	103％

(2) 4 Pivotal Strategies – Details

① Creation of New Value

Build a corporate culture supportive of challenge and able to integrate the power and resources of the entire company

a. Creation of new businesses and growing existing businesses

a-1. Creation of new businesses ‐Promote innovation by diving deeper into core technologies and combining them effectively

・Commercialization of functional films such as films for next-generation lithium-ion batteries
・Promote partnering with startups and M&A; developing platform for new business creation
To provide more security and comfort and to benefit future generations, we employ our technology to help create a sustainable society

Next-generation lithium-ion
battery external view

Film for next-generation
lithium-ion batteries

a-2.Growing existing businesses by expanding new fields / domains
-People/earth-focused products/services 【Security, Reliability, Comfort】

Expand sales for plastic films, medical materials, etc. globally (North America, China, ASEAN, etc.)

Expand semiconductor / medical-related businesses in the engineering plastics segment (Photo: Clean Konan Factory completed in 2020)

Accelerate shift to DTC business model for apparel (online sales, directly managed stores); strengthening women’s innerwear and leggings product lineups

Strengthen swimming and other schools in the sports club business

b. Offering new products/services designed with enhanced sustainability in mind
-People/earth-focused products/services 【Security, Reliability, Comfort】

Medical

Continue releasing innovative products centering on absorbable products
Photo: TENALEAF® — the first Japan-made sheet-type absorbable adhesion barrier

Plastic Films

Create new value through resource-circulating type films
(Chart) Technology established for environmentally friendly water-flotation film to promote recycling

Engineering Plastics

Expand fluororesin product lines in health / medical-related fields

Apparel

Reinforce and expand wellness & health category products

Gunze Development

Renovation of “Gunze Town Center TSUKASHiN ” for enhanced people / environment friendliness

② Capital Cost-focused Management

Concentrate investments in high-growth fields and sustainability-focused businesses Enhance capital efficiency
by implementing performance indicator tree for GVA improvement

Category	Indicator	2021 results	2024 targets
Company-wide	ROE	2.6%	6.3% or higher
Company-wide	GVA	-2,679 million yen	Positive company-wide GVA
Divisions with positive GVA	ROIC	MBO based on ROIC

※ Divisions with negative GVA value to exert efforts to reach
positive GVA value expeditiously

③ Environmentally Responsible Management

Reducing negative environmental impact through business activities

a. Significant promotion of energy saving, creation, and recycling activities

Reduce CO₂ emissions by 35% or more by 2030 (vs. 2013, Scope 1+2*)

*Creating Scope 3 reduction scenario by FY2022 end

b. Resource circulation

Collaborative recycling promotion by Plastic Film and Apparel Divisions

c. Sustainable procurement

Promote purchase of biomass/renewable materials
■Plan to make 12 billion yen environment-related investment by 2030

Investment (100 millions of yen)		Main investment plans
Ｖ30-1	86	Circular Factory (Moriyama) “Net Zero Carbon” Factory (Yanase) Enhanced-efficiency equipment Solar power generation system Waste solvent recycling equipment
Ｖ30-2	25
Ｖ30-3	9
Total	120

Environmentally responsible model factories

Circular Factory

a. Petrochemical raw material use reduction
Thinner film design, increasing bio-based raw materials use

b. Establishing a resource circulation system
Recycling-oriented product development, establishing technology for raw material recycling

c. Efficient resource utilization
Recovering solid plastic waste for reuse to realize “zero emissions”

Zero emissions

“Net Zero Carbon” Factory

a. Energy efficiency improvement Realtime
visualization of energy usage, updating equipment to increase energy efficiency

b. Fossil fuel usage reduction Switching to full
electrification

c. Solar panel installation and greening

④ Evolution of Corporate Constitution

Nurture an organizational culture supporting diverse talent to attain fulfillment from work, establishing GUNZE as a healthy and visionary company that society can rely on

Create new value through business processes transformed through digital technology

(3) Investment and Financial Strategies

Investment Strategy

Strive to sustainably improve corporate value and coexist well with our planet through growth and environment-related investments

Focus areas	Main investment plans	Investment amount （2022～2024）
Investing in new fields / equipment essential for sustainable growth	・Investing in new equipment and strengthening production capacities mainly for plastic films, engineering plastics, and medical materials ・Establishing a solid foundation allowing apparel to shift to DTC business model ・Renovation of “Gunze Town Center TSUKASHiN”	11.4 billion yen
Environment-related investment	・Circular Factory (Plastic Film, Moriyama Factory) ・Net Zero Carbon Factory（Innerwear, Yanase Factory）	8.6 billion yen
Re-development of business sites and others	Building extension / reconstruction, equipment relocation, etc., accompanying environment- related investments	8.8 billion yen
Updating/improving efficiency in existing equipment/facilities	-	4.3 billion yen

・Funding for M&A investments to be flexibly supplied as additional budget
・10 billion yen spend over 3 years planned for R&D (previous 3 years: 8.3 billion yen)

Financial Strategy

Achieve environment-related investments and capital cost reduction while maintaining a solid financial foundation, improving GVA and generating increased free cash flows

Please see below for the details

Medium-term Management Plan ＜stage1 of "VISION 2030"＞(PDF:5.0MB)