February 3, 2011

Toray Industries, Inc.

Toray Develops Long-Term Corporate Vision "AP-Growth TORAY 2020"
and Medium-Term Management Program "Project AP-G 2013" (FY2011 to FY2013)

Toray Industries, Inc. (headquarters: Chuo-ku, Tokyo; President: Akihiro Nikkaku; hereinafter referred to as "Toray") announced today that it has established the long-term corporate vision AP-Growth TORAY 2020, a unified roadmap for management activities over the next 10 years. It will lead Toray Group to further growth and development with the realization of its Corporate Philosophy of "contributing to society through the creation of new value with innovative ideas, technologies and products" by applying "Innovation" to all of its corporate activities. From April this year, Toray will implement the medium-term management program Project AP-G 2013 to secure its return to a growth track after overcoming the recent economic crisis. AP-G2013 has been formulated based on the long-term corporate vision considering the ongoing changes in business environment.

AP-Growth TORAY 2020 declares Toray Group's high aim to become "a global top company of advanced materials" with its pursuit of technological innovation based on chemistry under the corporate slogan "Innovation by Chemistry." Under this new vision, Toray will enhance efforts to scale up its global business, while expanding its Green Innovation Businesses to contribute to solutions for today's increasingly critical global environmental issues, and energy and resource issues. Through these efforts Toray aims to efficiently seize business opportunities and continually expand revenues and profits. This signifies Toray's determination to remain a high-value corporate group for all stakeholders by playing an active role in contributing to social development and environmental stewardship, with its emphasis on corporate ethics, compliance with laws, and other CSR (Corporate Social Responsibility) issues.

Building on the robust business footing established through IT-II over the past two years, Toray will implement Project AP-G 2013 on the key principle of pursuing business expansion in growth regions and growth business fields. It aims to leverage growth opportunities in Asia and emerging countries elsewhere, and expand existing businesses and establish new businesses in four major growing business fields environment, water and energy; information, telecommunications and electronics; automobiles and aircraft; and life science. In particular, Toray Group will put comprehensive and potent resources into Green Innovation Businesses that contribute to solutions to intensifying global environmental issues, and energy and resource issues.

Quantitative targets by fiscal 2013, the final year of AP-G 2013, include consolidated net sales of 1.8 trillion yen and consolidated operating income of 150 billion yen.

Towards achieving these goals, Toray plans to implement 350 billion yen in capital investments and 160 billion yen in R&D in the three years beginning in fiscal 2011, as well as to launch and drive forward the group-wide projects of Green Innovation Business Expansion (GR) Project and Asia and Emerging Country Business Expansion (AE) Project, while taking on the Total Cost Reduction (TC-II) Project from a new angle.

Key performance indicators and policies are as follows:

1. Long-term corporate vision AP-Growth TORAY 2020 (around 2020)

Consolidated net sales : 3 trillion yen (of which Foundation Businesses account for 50% and Strategically Expanding Businesses, Intensively Developing and Expanding Businesses for the rest)
Consolidated operating income : 300 billion yen
Operating income margin : 10%
ROA : 10%
ROE : 13%

2. Fundamental Strategy for AP-G 2013 (fiscal year ending March 2014)

(1) Management benchmarks

Consolidated net sales : 1.8 trillion yen
Consolidated operating income : 150 billion yen
ROA : 8%
ROE : 11%

(2) Key policies

Capital investment strategy : Implement 350 billion yen in capital investments in the three years beginning in fiscal 2011. (2/3 of this capital investment will be allocated to growth expansion and 1/2 will be allocated to Asian markets)
M&A : Allocate funds in addition to capital investment based on strategic decisions.
R&D investment strategy : Invest 160 billion yen in the three years beginning in fiscal 2011.
Management framework : Establish APG Management Committee in each of seven business divisions to facilitate close collaboration among sales and marketing, production, technology and research R&D functions among Toray and the group companies.

(3) Group-wide projects

1. Green Innovation Business Expansion (GR) Projec : With the goal of expanding Green Innovation Businesses to 1 trillion yen by around 2020, grow its net sales from the current 370 billion yen to 500 billion yen in fiscal 2013.
2. Asia and Emerging Country Business Expansion (AE) Project : Fully utilize group-wide management resources to facilitate and expedite the expansion of business in Asia and emerging countries elsewhere. Raise ratio of net sales in countries other than Japan, the U.S and Europe to 40% (720 billion yen) of total sales from 34%, or 520 billion yen, in fiscal 2013.
3. Total Cost Reduction (TC-II) Project : Strengthen variable cost reduction efforts by carrying out purchasing VA activities and building a global procurement system to reduce variable costs by 3% or more each year and in excess of 10% (70 billion yen or more) over three years.

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