Long-term Vision / Medium-term Business Plan

In May 2022, the AMADA Group announced its new Long-term Vision 2030 as its vision for the year 2030, founded in its five management philosophies, including “Growing Together with Our Customers.” In May 2023, we also formulated and announced our Medium-term Business Plan 2025 for the three years from fiscal 2023 as a specific action plan for sustainable growth and enhancement of corporate value.

Our Management Philosophy

  • 1Growing together with our customers
  • 2Contribute to the international community through our business
  • 3Develop human resources who pursue creative and challenging activities
  • 4Conduct sound corporate activities based on high ethics and fairness
  • 5Take good care of people and the earth’s environment

Social contributions through manufacturing and being the customer’s best partner in manufacturing

Long-term Vision / Medium-term Business Plan

Illustration：The roadmap of the Amada Group's long-term vision and medium-term management plan, which sets the long-term vision target of 500 billion yen in sales revenue and ROE of 10% or more by 2030, and aims to achieve these targets by expanding existing technologies and developing future growth fields. As a concrete action plan to achieve these goals, the Mid-term Business Plan 2025 sets forth the development of new products to solve social issues and the planting of seeds for growth fields, and sets the management targets of 400 billion yen in sales revenue, ROE of 8% or more, and 64 billion yen in operating income for 2025.

Developing new products to
help resolve social issues

  • Reducing environmental
    impact, improving
    productivity
  • Less skill required
  • Visualization

Toward achievement of our Long-term Vision 2030

Planting the seeds for expanding business domains into growth areas

Entering new business fields

Monetizing new domains and further expansion of existing domains

Long-term Vision 2030

Ending fiscal 2030

Revenue of ¥500 billion, ROE of 10% or more

Three priority items and three growth strategies to achieve our Long-term Vision 2030

Illustration：The diagram shows the three priority items and three growth strategies for the Long-Term Vision 2030. Growth strategy, improvement of capital efficiency, and promotion of ESG are the priority items, and through this cycle, we will promote management aimed at enhancing corporate value and sustainable growth. We have established three growth strategies: environmentally responsive business, DX & Services, and global expansion.

Practicing management to enhance corporate value and achieve sustainable growth

Medium-term Business Plan 2025

Fiscal 2023 to Fiscal 2025

Revenue of ¥400 billion, operating margin of 16%
ROE of 8% or more

Thoroughly strengthening our management foundation and improving earnings through new products and activities

Four basic strategic policies

1. Full commitment to achieving revenue of ¥400 billion and improving profitability
(1) Expanding new product share and improving profit margins

In February 2023, we updated approximately 80% of our core sheet metal products. Given the current environment surrounding our customers, new models are focused on increasing productivity, improving processing accuracy, and contributing to the environment. The new products have high profit margins, which is key to increasing revenue and improving profitability.
We also regard the development and expansion of automation products as an important strategy which we will continue to promote.
We aim not only to automate processing in single processes but will also make new investment in the transporter devices that link different processes.
Additionally, we will roll out software and IoT services that perform control at the level of the whole factory to support digital transformation (DX) at customer production facilities.

    • High speed and quality
      Evolution of optical
      technology       Photo：Evolution of High-Speed, High-Quality Laser Light Technology
    • Laser control technology Photo：Light Manipulation Technology
    • Laser welding
      Expanding the lineup       Photo：Laser welding lineup expansion
    • New numerical control (NC) operation
      system with advanced
      technology and 4 “e”s
      Photo：New NC operation system with advanced technology and 4 “e ”s Photo：New NC operation system with advanced technology and 4 “e ”s
    • Electric servo
      Benders       Photo：Electric Servo Bender
    • Automation Photo：Automation Products
    • Inter-process transport Products for in-process transfer
    • Manufacturing DX solutions
      Illustration：Manufacturing DX Solution Image
      Illustration：Manufacturing DX Solution Image
(2) Enhancing after-sales services

The after-sales service business is one of our strengths that is resilient to economic fluctuations and ensures stable earnings.
We will focus on five main offerings supporting customer production, with the aim of achieving sustainable profitability growth.

Enhancing
After-Sales
Services to
Support Customer
Production
  • Customer support system

    Using DX to restructure
    our direct service system

  • Production technology
    support business

    Enhancing productivity
    through technology support

  • Retrofitting business

    Cultivating new markets
    in Japan and overseas
    with mechatronics and
    added safety
    features to existing machines

  • Factory automation

    Increasing production capacity
    with automation equipment and software

  • Cloud business

    Supporting customer
    activities with
    cloud computing

(3) Utilizing AGIC

The new AMADA GLOBAL INNOVATION CENTER (AGIC) is an AMADA facility designed to attract customers. This is a place where customers can work with AMADA’s engineers to solve the processing issues they are facing or develop new technologies to break into new markets.

A space for co-creating the future of metalworking together with our customers

  • Innovation SITE

    Customers enjoy hands-on experiences of today’s cutting-edge technology that offers the value they expectFor greater impact of new products

  • Innovation LABO

    Verifying customers’ manufacturing and tackling the challenge of future processing technologiesNew market expansion

2. Begin activities for our long-term growth strategy
(1) Expanding new domains with laser technology

The AMADA Group was a pioneer in adopting and commercializing laser technology. Until now, our mainstay sheet metal fabrication business has focused on processing iron and stainless steel. Going forward, we will take on the challenge of expanding our business domains by targeting highly reflective materials such as copper and aluminum, non-metallic materials, and micro processing to be used in growth industries.

Illustration：The figure illustrates the expansion of new areas through laser technology. We will expand our comprehensive solutions as a group through laser technology, including micro forming and material processing, to the expanding markets of 2030, such as medical, semiconductor, and e-Mobility.

(2) Global market growth strategy

Currently, our geographic sales composition is 40% in Japan and 60% overseas. In our Long-term Vision 2030, we envision 35% in Japan and 65% overseas. To put in place an overseas supply system to support this, we will improve costs, delivery time, and inventories through local production for local consumption, and at the same time, improve profitability.

Strengthening our supply structure and improving profitability through global manufacturing transformation

Immediate delivery system through local production for local consumption, global standard quality, reinforcing cost competitiveness, and enhancing appropriate inventories (supply chain management [SCM] strategy)

Illustration：Diagram illustrating the global market expansion strategy. Aiming to strengthen the supply system and improve profitability through global manufacturing reform, we have established plants in North America, Europe, and Asia in addition to Japan, and plan to add more plants in Asia by 2025 to strengthen Q, C, and D and achieve appropriate inventory through local production for local consumption.

  • Japan Illustration：Graph showing actual and target sales in Japan, from 141.9 billion yen in FY2022 to 170 billion yen in FY2030, an increase of 20%.
  • North America Illustration：Graph showing actual and target sales in North America, from 88.7 billion yen in FY2022 to 130 billion yen in FY2030, an increase of 47%.
  • Europe Illustration：Graph showing actual and target sales in Europe, from 65.9 billion yen in FY2022 to 110 billion yen in FY2030, an increase of 67%.
  • Asia Illustration：Graph showing actual and target sales in Asia, from 51.2 billion yen in FY2022 to 90 billion yen in FY2030, an increase of 76%.
(3) Medium-term strategic investment plan

We will shift from investment centered on expansion of production capacity to balanced investment that includes intangible aspects (DX, research and development, the environment, and human resources), and make further future growth investments.

Research and development/M&A
Approx. ¥50–60 billion		 Research and development: Building new processing technologies and providing products with strong soft aspects/environmental friendliness
Synergy development: Strengthening the Group’s market and manufacturing strategies
M&A: Accelerating new business expansion
Supply system
Approx. ¥20–30 billion		 Asian supply strategy (including global procurement)
North American supply strategy (strengthening automation systems)
IT/DX
Approx. ¥10 billion		 Global customer relationship management (CRM) construction, security investment, manufacturing and supply coordination system construction
Human resource investment
Approx. ¥10 billion		 Technical education centers, reskilling, DX/global human resource development
Environmental investment
Approx. ¥10 billion		 Environmental investments in business sites and manufacturing, improving manufacturing efficiency
Total: Approx. ¥100–
120 billion		 Medium-term Business Plan 2025
3. Capital policies (shareholder returns)
(1) Cash allocation
Strategic/renewal investment ¥100–120 billion
Working capital ¥100 billion
Shareholder returns ¥100–120 billion
(2) Shareholder return policy
  • Setting the annual dividend amount to target a consolidated dividend payout ratio of 50% and to maintain a dividend on equity (DOE) ratio within the range of approximately 3% to 4%
  • Planning continuous and phased share buybacks in consideration of cash flows and other factors, assuming a limit of ¥40 billion to ¥60 billion in buybacks

Graph：Graph showing the change in dividendsFrom a dividend of 30 yen in FY2020, we have increased dividends for three consecutive fiscal years, reaching 57 yen in FY2023.Graph

■ Shareholder returns

In accordance with our shareholder return policy, we conducted share buybacks worth approximately ¥20 billion in fiscal 2024, in addition to the above dividends. In fiscal 2025, we are planning share buybacks for a maximum total of ¥20 billion in shares. We will continue to apply our shareholder return policy with an eye to achieving stable dividends and improving ROE.

  Results from fiscal 2022 Results from fiscal 2023 Planned for fiscal 2024 Planned for fiscal 2025
Annual dividends paid
(Dividend payout ratio)		 ¥48
(48.9%)		 ¥60
(50.4%)		 ¥62
(62.8%)		 ¥62
(64.3%)
Dividend on equity ratio (DOE) 3.3% 3.8% 3.9% 3.9%
Purchase of treasury shares − ¥20.0 billion ¥20.0 billion ¥20.0 billion
Total return ratio 48.9% 99.7% 124.6% 128.8%
4. ESG management/reinforcing systems
Indicator Data Coverage FY2022
Result		 FY2023
Result		 FY2025
Target		 FY2030
Target
Environment Reduction of product
CO2 emissions		 Group Consolidated
(vs. FY2013)		 58.4%
reduction		 68.9%
reduction
(prospective)		 50.0%
reduction		 50.0%
reduction
Reduction of business site
CO2 emissions		 73.4%
reduction		 77.8%
reduction
(prospective)		 70.0%
reduction		 75.0%
reduction
Society Education and training
hours per employee		 Major group companies in Japan* 47.7 hours 41.7 hours 40.0 hours 45.0 hours
Number of
female managers		 15 17 24 40
Rate of female
new graduates hired		 32.6% 27.6% 25% 25%
Paid leave
acquisition rate		 74.3% 77.1% 80% 100%
Childcare leave
acquisition rate
(Men/Women)		 68.2%/100% 82.5%/100% 70%/100% 100%/100%
Governance Ensuring diversity
on the Board of
Directors		 Group Consolidated External directors: 4 of 9
Female directors: 1		 External directors: 4 of 9
Female directors: 1
Female auditors: 1		 Increase in diversity Maintenance / Increase
Review of the officer
remuneration system		 – Introduction of stock compensation system linked to the achievement of medium-term business plan Introduction of medium- to long-temr incentive plan Reinforcement of management structure

*The major companies in Japan refer to the following five entities: Amada Co., Ltd., Amada Machinery Co., Ltd., Amada Weld Tech Co., Ltd., (On April 1, 2024, it merged with Amada and has been dissolved.), Amada Press System Co., Ltd., and Amada Tool Co., Ltd.

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