Mitsubishi Electric Corp. · TSE:6503
Mitsubishi Electric — Investor Presentation (November 2022)
46 slides from Mitsubishi Electric's investor presentation, November 2022
Slide 1: Mitsubishi Electric Corporate Strategy
Mitsubishi Electric Corporate Strategy Nov 2022 ©Mitsubishi Electric Corporation
Slide 2: Contents
Contents 1. Mitsubishi Electric’s Sustainability Management 1-1. Sustainability Management 1-2. Circular Digital-Engineering Company that provides solutions to social challenges 1-3. Integrated Solutions 1-4. Sustainable Future by Mitsubishi Electric 2. Progress of Medium-term Management Plan Toward
Slide 3: Mitsubishi Electric's Sustainability Management
M it su bishi E lec t r ic ’s 1 S u st a inability M a n a gem en t ©Mitsubishi Electric Corporation 3
Slide 4: Sustainability Management
1-1 Sustainability Management Position the realization of sustainability as the cornerstone of our management to promote solutions to social challenges through our businesses. Clarify five challenge areas to focus on. Five challenge areas Carbon neutral Circular economy Safety/Security Inclusion Wel
Slide 5: Circular Digital-Engineering Company to solve social challenges
Circular Digital-Engineering Company to solve social 1-2 challenges Aim to transform into “Circular Digital-Engineering” company that provides evolved Integrated Solutions by co-creation and by integrating knowledge within and outside the Group. Contribute to solving various social challenges. Solve
Slide 6: Evolution of Integrated Solutions
1-3 Integrated Solutions Evolution of Integrated Solutions Support the entire lifecycle from consulting to maintenance and operation. Evolve our Integrated Solutions by using algorithms with the Group’s strengths and by incorporating knowledge and assets from outside the Group. Integrated Solutions
Slide 7: Strengthen value proposition through evolving Integrated Solutions
1-3 Integrated Solutions Strengthen value proposition through evolving Integrated Solutions Strengthen components as the base of our business, expand systems utilizing advanced digital technologies, and provide Integrated Solution with these at the core, to be driving the driving force behind contin
Slide 8: Integrated Solutions business fields
1-3 Integrated Solutions Integrated Solutions business fields Leveraging our strengths, provide Integrated Solutions starting from the three fields of carbon neutral, comprehensive asset management, and IT/OT(*) security. Furthermore, contribute to solving social issues by expanding solutions to new
Slide 9: A Future Created by Mitsubishi Electric
1-3 Integrated Solutions A Future Created by Mitsubishi Electric Create a future with our customers and partners in a wide range of business situations, with an eye on diversifying social issues Circular economy Carbon neutral Vision of the Future We Will Create ・Social infrastructure in harmony wit
Slide 10: Initiatives for Carbon-Neutral
1-4 Sustainable Future by Mitsubishi Electric Initiatives for Carbon-Neutral Adopted dual approaches to carbon-neutral: Responsibility and Contribution. Develop internal initiatives into businesses Responsibility Contribution Achieve Make the entire carbon- Create/expand value chain carbon neutral n
Slide 11: Initiatives to Realize Carbon-Neutral
1-4 Sustainable Future by Mitsubishi Electric Initiatives to Realize Carbon-Neutral Contribution Create/expand businesses that contribute to carbon-neutral. To make society as a whole carbon neutral, accelerate R&D in three innovation areas: Green by Electronics, Green by Digital, and Green by Circu
Slide 12: New Management Structure to Achieve Sustainability Management
1-4 Sustainable Future by Mitsubishi Electric New Management Structure to Achieve Sustainability Management Established four Business Areas (BA) that will enhance sustainability management. Accelerate solving social challenges through our businesses by BA owners envisioning their ideal state with a
Slide 13: Progress of Medium-term Management Plan Towards FY2025
Progress of Medium-term Management 2 Plan Towards FY2025 ©Mitsubishi Electric Corporation 13
Slide 14: FY2025 Financial Targets
2 Progress of Medium-term Management Plan Towards FY2025 FY2025 Financial Targets Revenue ¥5 trillion Operating Profit Margin 10% ROE 10% Cash Generation(*) ¥3.4trillion / 5 years *Cash Generation: Adjusted operating cash flow (CF) ©Mitsubishi Electric Corporation 14
Slide 15: Strengthening of Business Portfolio Strategy
2-1 Strengthening of Business Portfolio Strategy ©Mitsubishi Electric Corporation 15
Slide 16: Approach to Business Portfolio Strategy
2-1 Strengthening of Business Portfolio Strategy Approach to Business Portfolio Strategy Classify businesses according to their characteristics and optimize investment of management resources. High Resilient Businesses Key Growth Businesses <Have stable demand and contribute to our <Growth drivers t
Slide 17: Progress of Business Portfolio Strategy: Key Growth Businesses
2-1 Strengthening of Business Portfolio Strategy Progress of Business Portfolio Strategy Key Growth Businesses <Scale Expansion through Growth Investment> Established a new factory in India for factory automation control system FA Control products Systems Invested approximately ¥3.1 billion to estab
Slide 18: Progress of Business Portfolio Strategy: Resilient Businesses
2-1 Strengthening of Business Portfolio Strategy Progress of Business Portfolio Strategy Resilient Businesses <Strengthening Profitability> Improve profitability of certain businesses and add them to Resilient Businesses Processing machines, High-frequency optical devices, and IT infrastructure serv
Slide 19: Optimal Group Management Strategy
2-1 Strengthening of Business Portfolio Strategy Optimal Group Management Strategy Pursue an optimal group management system by strengthening the functions and reviewing the division of roles of affiliated companies in each value chain. Develop structures and strengthen the development capability of
Slide 20: Priority Allocation of Resource Investment
2-1 Strengthening of Business Portfolio Strategy Priority Allocation of Resource Investment Invest resources in the amount of ¥2.8 trillion, up ¥0.8 trillion from the previous medium-term management plan, centered on Key Growth Businesses. Attain the FY2025 financial targets (revenue of ¥5 trillion,
Slide 21: Capital Allocation Policy
2-1 Strengthening of Business Portfolio Strategy Capital Allocation Policy For capital allocation, giving top priority to investment in growth, further enhance shareholder returns through profit growth. In terms of cash generation, the source of capital, aim to generate ¥3.4 trillion over a five-yea
Slide 22: Enhancement of Business Foundation for Sustainable Growth
2-2 Enhancement of Business Foundation for Sustainable Growth ©Mitsubishi Electric Corporation 22
Slide 23: Diversity and Employee Engagement: Human Rights
2-2 Enhancement of Business Foundation for Sustainable Growth Diversity and Employee Engagement Promote respect for human rights Promote an initiative for highly objective and transparent respect for human rights in accordance with the UN Guiding Principles on Business and Human Rights and the RBA(*
Slide 24: Diversity and Employee Engagement: Work Environment
2-2 Enhancement of Business Foundation for Sustainable Growth Diversity and Employee Engagement Realize a work environment where all employees can work with vitality Based on its resolve to never tolerate harassment, the Group as a whole is advancing “Mitsubishi Electric Workplace Reform Program” ba
Slide 25: Information Security / Product and Service Quality
2-2 Enhancement of Business Foundation for Sustainable Growth Information Security / Product and Service Quality Information Security Develop a comprehensive, multi-layered defense system As a countermeasure against cyber-attacks, which are becoming increasingly sophisticated with the use of cloud s
Slide 26: Operation DX
2-2 Enhancement of Business Foundation for Sustainable Growth Operation DX Total optimization extending beyond the boundaries of business Achieve total optimization extending beyond the boundaries of business by standardizing cross- business operations and centralizing reusable data. Promote Operati
Slide 27: Risk Management and Swift Decision Making
2-2 Enhancement of Business Foundation for Sustainable Growth Risk Management and Swift Decision Making Emerging Modern Issues Commitment to Safe plans for procurement Preparation for Sustainability and transportation risks geopolitical Risks Social demand for human rights and environment protection
Slide 28: Governance and Disclosure
2-2 Enhancement of Business Foundation for Sustainable Growth Governance and Disclosure Strengthen Governance and Revitalize internal and external Communication Enhance the Board of Directors’ monitoring of business execution Appointed an independent outside director as chairperson of the Board of
Slide 29: Activities to promote an inclusive society
2-2 Enhancement of Business Foundation for Sustainable Growth Activities to promote an inclusive society Employees and the company shall work together to promote the "three forms of coexistence" and realize an inclusive society Coexistence Promote activities that remind us how much we appreciate nat
Slide 30: Initiatives, External Evaluations
2-2 Enhancement of Business Foundation for Sustainable Growth Initiatives, External Evaluations Initiatives Expressed approval for the recommendations by the Task Force Continue our commitment to the UN Global Compact on Climate-related Financial Disclosures (TCFD) (*1) Continue to promote initiativ
Slide 31: Initiatives for Creation of Innovation and Future Growth
Initiatives for Creation of Innovation 2-3 and Future Growth ©Mitsubishi Electric Corporation 31
Slide 32: Open Innovation
2-3 Initiatives for Creation of Innovation and Future Growth Open Innovation Expand our solution domain by leveraging external knowledge and technology through means such as M&As, co-creation with customers and partners, and collaborations with start-ups. Expand business domains through M&As Create
Slide 33: R&D Strategy
2-3 Initiatives for Creation of Innovation and Future Growth R&D Strategy Pursue the enhancement and reform of existing businesses as well as R&D for new value creation in a balanced manner. Aim to address social challenges at an early stage through the active use of open innovation. Strengthen our
Slide 34: R&D Strategy - Major Themes
2-3 Initiatives for Creation of Innovation and Future Growth R&D Strategy - Major Themes - Core technologies Base technologies AI that can clarify its control SUSTIE, the ZEB technology test facility rationale • Achieved "ZEB" in the operational phase Contribute to the realization of a First medium-
Slide 35: Intellectual Property Strategy
2-3 Initiatives for Creation of Innovation and Future Growth Intellectual Property Strategy Strategy 1. Open Technology Bank® Strategy 2. Qualitative IP activity targets Facilitate technology integration by Internal Collaboration & In addition to quantitative advantages, enhance qualitative IP Open
Slide 36: Three Reform Areas for Regaining Trust
3 Three Reform Areas for Regaining Trust ©Mitsubishi Electric Corporation 36
Slide 37: Three Reform Areas for Regaining Trust
3 Three Reform Areas for Regaining Trust • Consider measures based on recommendations from the Investigative Committee and the Governance Review Committee, as well as our cause analysis results • In rebuilding Mitsubishi Electric, reaffirm the crucial importance of conducting a fundamental review of
Slide 38: Quality assurance reforms: Revising engineering processes
3 Three Reform Areas for Regaining Trust Quality assurance reforms—Revising engineering processes Focus on enhancing engineering capabilities and reforming manufacturing processes based on our investigation results, in addition to efforts currently underway, including “reconstruct the control functi
Slide 39: Organizational culture reforms: Facilitating two-way communication
3 Three Reform Areas for Regaining Trust Organizational culture reforms—Facilitating two-way communication Having been carried out in harmony with efforts to renew the human resources management system and in accord with the Robust Policies for overarching plan for organizational culture reforms cre
Slide 40: Governance reforms: Building a compliance system focused on prevention
3 Three Reform Areas for Regaining Trust Governance reforms—Building a compliance system focused on prevention Recognizing that governance reforms are a top priority that management must commit to when the company is to restore public trust and continue building corporate value, we will build system
Slide 41: Appendix
Appendix ©Mitsubishi Electric Corporation 41
Slide 42: Single-year Outlook for FY2022 (Consolidated Performance)
Single-year Outlook for FY2022 Appendix (Consolidated Performance) FY2019 FY2020 FY2021 FY2022 Actual Actual Actual Forecast 6-Month 6-Month (Oct. 2022) 109JPY/US$ 106JPY/US$ 110JPY/US$ 113JPY/US$ 135JPY/US$ 135JPY/US$ (Billions of JPY) 121JPY/Euro 124JPY/Euro 131JPY/Euro 131JPY/Euro 139JPY/Euro 137
Slide 43: Outlook for FY2022 (Segment Forecast) and FY2025 target
Outlook for FY2022 (Segment Forecast) Appendix and FY2025 target (Billions of JPY) FY2019 FY2020 FY2021 FY2022 FY2025 Actual Actual Actual Forecast Target 6-Month 6-Month (Oct. 2022) 109JPY/US$ 106JPY/US$ 110JPY/US$ 113JPY/US$ 135JPY/US$ 135JPY/US$ 105JPY/US$ 121JPY/Euro 124JPY/Euro 131JPY/Euro 131J
Slide 44: Outlook for FY2022 (Sub-segment Forecast) and FY2025 target
Outlook for FY2022 (Sub-segment Forecast) Appendix and FY2025 target (Billions of JPY) FY2021 FY2022 FY2025 Actual Forecast Target (Oct. 2022) 113JPY/US$ 135JPY/US$ 105JPY/US$ 131JPY/Euro 137JPY/Euro 115JPY/Euro 17.7JPY/CNY 19.5JPY/CNY 15.0JPY/CNY Revenue 946.1 970.0 \1.1tn Infrastructure Operating
Slide 45: Cautionary Statement
Cautionary Statement While the statements herein, including the forecasts regarding the Mitsubishi Electric Group, are based on assumptions considered to be reasonable under the circumstances on the date of announcement, actual results may differ significantly from forecasts. The main factors materi
Slide 46: Mitsubishi Electric: Changes for the Better
» MITSUBISHI ELECTRIC Changes for the Better
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