Mid-Term Business Plan 2025

The Mid-Term Business Plan 2025, launched in FY2023, is positioned as a three-year plan marking the first step toward our 100th anniversary, with the basic policy of “challenging to sustainably growing 100 year venture.” Under this plan, we are addressing management challenges and implementing growth strategies across each business based on the three core pillars of our fundamental strategy: Deepening Customer Orientation,

Reforming the Foundation, and DX Acceleration.

Growth investment

In FY2024, we made strategic investments in M&A, including minority investments in several start-ups in the Eye Care Business. In terms of capital investment, we made investments necessary for improving the production system, promoting the growth strategy, and improving operational efficiency. In addition, we continued to make development investments actively, mainly for expanding DX solutions as well as developing new products and next-generation technologies to enter new business domains. Net cash generated by cash flows from operating activities were mainly used for these investment activities, supplemented by funds procured through bonds, bank loans, etc. We will continue to invest mainly in new technologies and new business domains to expand our shares in growth areas.

Cost of capital and ROE

We have considered ROE as an important indicator under the Mid-Term Business Plan 2025. We are working to strengthen management with an awareness of the cost of capital, while focusing not only on profitability but also on capital efficiency and the optimal capital structure.

In FY2024, although the Eye Care Business maintained strong sales, sales slowed down globally in the Positioning Business, mainly due to restrained investment. This, in addition to the recording of onetime losses, including structural reform-related expenses, resulted in a fall in profit attributable to owners of parent, and ROE as an important indicator was 0.4%.

Growth strategy

We believe we are entering a critical phase in which both our Positioning Business and Eye Care Business must accelerate bold growth investments. To advance initiatives that go beyond conventional business measures, it will be essential to maintain sustained, Long-Term investments despite an increasingly uncertain business environment driven by economic instability and geopolitical risks, particularly in Europe and the U.S. Furthermore, in creating new businesses, there are also uncertain risks in executing our business. While these measures are expected to enhance the Company’s corporate value over the long term, they may have a negative impact on the Group’s short-term income and cash flow. If such measures were to be implemented while the Company remains publicly listed, there is a risk that the capital markets may not fully appreciate their value in the short term. As a result, it could potentially disadvantage the Company’s current shareholders.

After a careful evaluation of a range of options for these issues, the Company has concluded that the best path forward to benefit all stakeholders, including shareholders, is to address these management challenges flexibly through privatization. This will be achieved under a management buyout (MBO) in strategic partnership with KKR and JICC, while continuing current management policies, strategies, and overall management. This will establish a stable management structure where shareholders and management are aligned, enabling us to respond to business challenges with agility and flexibility. Going forward, we will pursue proactive investments with a Long-Term perspective and enhance our global competitiveness to strengthen our business structure.