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Management Strategy

FOR INVESTORS IR Information

KBK’s Management Policy

KBK established its corporate philosophy of “Personnel, Technology and Confidence” in 1987, the 40th anniversary of its founding. For over the past 30 years, the KBK Group’s officers and employees have worked together to further KBK’s business in accordance with this philosophy, which we perceive as a universal concept.

KBK’s Medium- to Long-term Management Strategy

Under the mid-term management plan “KBK Breakthrough 2023,” this concept is founded on a strategy for realizing KBK’s management vision and recreating ourselves as the new KBK Group. The mid-term management plan is composed of the two main approaches described below.

(1) Pursue and mobilize functions to radically strengthen earning capacity

The first aspect of this approach is “business portfolio optimization.” Over 70 years have passed since KBK was founded, and we are witnessing a huge transformation in the demand for our businesses handling resources and equipment, which previously targeted the domestic industries that supported Japan through the era of rapid economic growth. In order to respond to this transformation, we face the urgent tasks of reallocating resources within KBK and the KBK Group, and restructuring its divisions. To this end, we will engage in a fundamental review of all of the Group’s businesses, focus resources on growth industries, and enhance the efficiency of businesses targeting mature industries. In addition, we will assess the capital efficiency of each business. For inefficient businesses, we will consider and implement measures including review of business processes and withdrawal. In any case, we will continue to provide industries in Japan and overseas with products, services, and systems suited to their needs.
The second aspect of this approach is “M&A and business investment to generate new value.” Where the optimization of our business portfolio reveals areas requiring supplementation or reinforcement, we will leverage M&A activities and business investment to accomplish this. At the same time, we plan to actively invest in businesses and human resources to expand into new fields.

(2) Thoroughly enhance our corporate culture to fulfill our responsibilities to all stakeholders

The first aspect of this approach is to manage the Group with an awareness of the cost of capital, to meet the expectations of all our stakeholders, primarily our shareholders. We will strive for balance sheet management based on KBK’s approach to optimal capital structure, while simultaneously engaging in initiatives for the sustained generation of returns exceeding the cost of capital.
The second aspect of this approach is “corporate value enhancement through stronger IR, PR and ER.” Stronger IR activities are vital for raising KBK’s stock price, and we consider that proactive PR activities are also necessary to raise understanding of the work of the KBK Group. Meanwhile, we understand that ER activities are a vital part of achieving the goals of “KBK Breakthrough 2023,” by embedding the plan’s management vision and strategy across the entire KBK Group, and ensuring that each and every employee is actively involved in pursuing them.

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