On December 11, Showa Denko announced its New Mid-term Business Plan “The TOP 2021” from 2019 to 2021. The New Business Plan has mapped out a planned investment of 400 billion yen for three years to reinforce the existing business, M&A and business tie-ups, aiming at an accumulative sales amounting to 3 trillion and 400 billion yen with an operating income of 480 billion yen and a net profit of 330 billion yen for the period of the new Business Plan.

In the new plan relating to the gas business, the industrial gas is positioned at the target for “enhancement” and the high-purity specialty electronics gas for “growth.”

In the field of industrial gases, SDK intends to deepen engagements in some specific territories like Ammonia, hydrogen, carbon dioxide or dry ice with which the group is confident. Regarding carbon dioxide which is apparently running short in Japan, reviewing and reinforcement will be made in the current business bases. It is aimed to improve the profitability in the matured market rather than any positive increasing of sales by market developments.

The field of high-purity specialty gases for electronics on the contrary is judged to be a growing business for which there are needs in the global market. SKD is planning to go further ahead with various investment schemes such as the new establishment and expansion of etching gas facility and the new development of bases for distribution, logistics, procurement and marketing in North America and China, which have been implemented under the previous Business Plan “Project 2020 +.” In and after 2019, SDK is targeting a growth of 10% per annum or more by developing and marketing high value-added gases with investments and collaboration with other companies.
Out of the investment amounting to 400 billion yen, 120 billion yen goes to improvements like renewal of aged facilities and reinforcement of BCP matters, while 130 billion goes to the growing segments for expansion of facilities and improvement of productivity. The remaining 150 billion will be allotted for M & A though not disclosed yet, including the acquisition, tie-up and investment of other companies.

For reference, the total business result for the period from 2016 to 2018 of “Project 2020+” is forecast to amount to 2436.5 billion yen with operating income of 289.8 billion yen and net profit of 164.7 billion yen. The new Mid-term Business Plan is targeted to increase the sale by 40% with operating income up 66% and net profit up 100% in comparison with the previous plan.