Medium-term Management Plan BUILDING THE FUTURE 2025

Business Environment

Due to changes in the social, technological, and economic environment surrounding companies, the competitive environment has changed drastically. Competition and cooperation with other industries are becoming increasingly active, such as acceleration of the development of decarbonization technology including electrification, digitization of construction sites, autonomous operation and other factor. Under these circumstances, our capital structure changed dramatically in 2022. About half of the shares held by Hitachi, Ltd. were transferred to the investment company funded by ITOCHU Corporation and Japan Industrial Partners, Inc., and the largest shareholder changed. There are a variety of changes, and we are now in a new phase of growth.

Core Strategy

Our customers’ management issues are “improve safety” “improve productivity” “reduce life cycle costs”, and environmental response. They are current issues and will be the same in 10 years later. However, the solutions to these issues will be different in 10 years. For example, how to deal with new safety issues caused by advances in automation technology, and how to recycle batteries affected by advances in electrification technology. We continue to provide innovative solutions to our customers to resolve these issues. That is the mission in our group identity “Meet expectations from customers, co-create innovative products, services, solutions and together, we continue to create new values”.


As for growth, the value chain ratio and own business revenue in the Americas are as described on previous slides. As for profitability, we have set an adjusted operating income ratio 13% or more and we have newly added an EBITDA margin 18% or more as “a capacity indicators for cash generation” which is the ability to earn against sales. As for efficiency, an operating cash flow margin and a ROIC are added as new indicators. We recognize that the level of capital cost (WACC) to be compared in the ROIC target is at about 7%. By setting a minimum spread required by investors at 2% and setting ROIC target at 9% or more, we will develop our business with an awareness of the operational efficiency for invested capital and improve capital profitability. In addition, in order to return profits to shareholders, we will maximize shareholder returns based on “stable and continuous implementation with a consolidated dividend payout ratio of 30%-40% as a guide”. Moreover, we have added ESG related items as targets. In addition to CO2 reduction target as the environmental impact reduction mentioned earlier, we have also established indicators for diversity, equity and inclusion. We provide opportunities for diverse human capital globally to maximize their capabilities and properties, thereby enhancing corporate value.