Mitsubishi Corporation New Strategic Direction: "Charting a New Path toward
Tokyo, May 8, 2013 - (JCN Newswire) - Mitsubishi Corporation has developed its
new management strategy, entitled New Strategic Direction (charting a new path
toward sustainable growth). It goes into effect from fiscal year 2013.
Amidst major changes in Mitsubishi Corporation's business models and the
external environment, we have abolished our traditional "midterm
management plan" concept of committing to fixed financial targets three
years in the future, in favor of a long-term, circa 2020 growth vision. To
realize this vision we have set down our "New Strategic Direction",
which consists of basic concepts on management policy together with our
business and market strategies.
New Strategic Direction seeks to recognize our value and upside potential as a
sogo shosha capable of "providing stable earnings throughout business
cycles by managing a portfolio diversified by business model, industry, market
and geography". As we optimize our portfolio, we will strive to realize
our growth vision and enhance the Mitsubishi Corporation’s overall corporate
Mitsubishi Corporation circa 2020: Double Business
Mitsubishi Corporation’s ability to maintain stable earnings is based on its
improved concept of portfolio management. Acknowledging both this strength and
our company's upside potential, we have set down our circa 2020 long-term
growth vision as follows:
Resource (LNG, metallurgical coal, copper) -> Double Equity Production
(compared to FY2012)
Non-Resource -> Double Earnings Level (compared to FY2012)
Mitsubishi Corporation circa 2020 Portfolio Vision: Optimal Diversification
& Winning Businesses
- Select "Winning Businesses" through proactive reshaping of
Reduce number of business sub-segments from current total of 47 to between 35
- Strengthen these Winning Businesses
Reshape portfolio to consist of at least 10 business sub-segments earning more
than 20 billion yen in net income, and between 10 and 15 business sub-segments
earning between 10 and 20 billion yen in net income.
- 50:50 Resource to Non-Resource Asset Ratio
Create sustainable corporate value through business activities and strengthen
"winning businesses" through the proactive reshaping of the portfolio
in order to win competition at a global scale.
2． Investment Policy
Accelerate divestments selectively and free up capital for new investments,
while continue consistent investment at a rate in line with the average of the
last 3 years (under Midterm Corporate Strategy 2012) in order to improve our
3． Financial Discipline
Increase focus on financial discipline including funding our investments
within our own cash flow assuming a base earnings level of 350 billion yen per
annum. Deliver a return on equity of 12-15% in the medium to long term.
4． Dividend Policy
Introduce a two-staged dividend policy with a base and a variable portion in
order to provide a stable dividend (set base dividend according to a base
earnings level of 350 billion yen per annum).
Market Strategy / Business Strategy
1. Market Strategy
We will accelerate our global business development by leveraging our shift
towards Asian markets, which are gaining greater international presence not
only as resource and industrial markets, but as consumer markets as well. Our
objective will be to ensure sustainable growth by capturing growth in Asia.
This will entail securing global supply sources to meet the increasing demand
for raw materials and other commodities in Asia, and establishing a local
presence within the region, through M&As, strategic alliances, and other
2. Business Strategy
Our resources business will be transitioning to the project development stage
toward full operation, which will primarily entail expanding our existing asset
base (metallurgical coal, copper, LNG, and other core assets). At the same
time, we will refocus on productivity and cost, be it capital or operational,
to make more efficient use of our management resources.
We will accelerate the shift of management resources to current and future
"winning businesses" to realize our long-term growth vision, which
aims to build multiple robust and large-scale earnings drivers. While
selectively growing businesses (automotive, foods, retail, power generation and
life sciences), we will be transforming our business models such as developing
downstream shale gas operations in North America and shifting to industrial
finance's asset management business.
Financial Projections for FY2013
Our FYE 3/2014 consolidated net income target will be 400 billion yen, up 40
billion yen from our actual earnings in FYE 3/2013. Our projected net incomes
from resource and non-resource businesses are 192 and 198 billion yen
respectively, both up from FYE 3/2013. In particular, we are anticipating
record high earnings from non-resource businesses. We intend to maintain our
usual level of investments; however, because we will be funding investments by
our own earnings, we expect net DER to be around 1.0.
Based on our new dividend policy, our dividend per share should be 60 yen
(assuming the variable portion's payout ratio of 30%).
About Mitsubishi Corporation
Mitsubishi Corporation (MC; TSE: 8058) is a global integrated business
enterprise that develops and operates businesses across virtually every
industry including industrial finance, energy, metals, machinery, chemicals,
foods, and environmental business. MC's current activities are expanding
far beyond its traditional trading operations as its diverse business ranges
from natural resources development to investment in retail business,
infrastructure, financial products and manufacturing of industrial goods. With
over 200 bases of operations in approximately 80 countries worldwide and a
network of over 500 group companies, MC employs a multinational workforce of
nearly 60,000 people. For more information, please visit www.mitsubishicorp.com.
Copyright 2013 JCN Newswire. All rights reserved. www.japancorp.net
Provider ID: 00026695
Press spacebar to pause and continue. Press esc to stop.