
We will take a firm step toward
the realization of a sustainable
society and the sustained
development of our business.
Vice President and Representative Director
Hideaki Asakura
"Future vision targeting 2050" Please tell us about the strategic positioning of "Taiheiyo Vision 2030."
When formulating the new Medium-Term Management Plan (26 Medium-Term Management Plan), we first started by examining the long-term "Vision for 2050," with the desire to clearly establish an unwavering axis. We believe that it is important to incorporate the opinions of young employees who will be the core of the company in 30 years' time, and when we conducted an in-house survey, a common vision of "wanting to be the leader of the global cement industry" emerged. We are the top specialist manufacturer of cement in Japan and maintain a certain presence in the Pacific Rim. However, in order to become a leader in the global cement industry, we need to establish a position comparable to that of overseas majors in terms of scale, profit levels, and the number of business areas. Furthermore, in this process, it is essential to achieve compatibility with carbon neutrality and circular economies. We will promote carbon neutrality and circular economies as a growth strategy, while seeking a balance with economic viability. In this way, we aim to achieve sustainable growth and become a leader in the global cement industry.
From there, we backcasted to set the interim target of "Taiheiyo Vision 2030," and further incorporated these visions into a concrete action plan, which is the 26 Medium-Term Management Plan covering the next three years. In the management targets and guidelines of the 26 Medium-Term Management Plan, we are aiming for the so-called Triple 10, with net sales of 1 trillion yen, operating income of 100 billion yen, and an operating profit margin of 10%. First, we will steadily achieve these targets and establish a solid profit base, and then realize the "Taiheiyo Vision 2030" and aim for "Future vision targeting 2050."
The 23 Medium-Term Management Plan fell short in many indicators.
On the other hand, cement prices were drastically revised in a short period of time for the first time in the history.
How do you reflect on this?
We must take it seriously that the management indicators set out in the 23 Medium-Term Management Plan, both operating income on net sales and ROE, were not achieved. The main factors were the decline in demand due to the COVID-19 pandemic and geopolitical risks, and the soaring prices of resources. The cement industry has been in a situation where it is difficult to pass through price increases due to sluggish domestic demand and industry practices. The result was a slump in the domestic business in the 23 Medium-Term Management Plan. Additionally, largely as planned, interest-bearing debt increased as a result of implementing growth investments outlined in the 23 Medium-Term Management Plan. Although our financial structure is improving due to the increase in operating cash flow, strengthening our financial base is one of our future challenges.
On the other hand, the success of drastic revision of domestic cement prices in a short period of time for the first time in the history in 2022 was an epoch-making event for the industry. We will strive to gain users' understanding regarding the appropriate maintenance of prices in accordance with the costs of raw materials, etc., and domestic demand. In addition, we consider it a major achievement that we were able to achieve the total return ratio as planned, and that progress has been made in domestic and overseas growth investments and carbon neutral initiatives.
Plan for FY2027
Management Targets
- Operating income on net sales
- 10% or more
- ROE
- 10% or more
Guidelines
- Net sales
- Over
1 trillion yen
or more
- Operating income
- Over
100 billion yen
or more
- Net debt/equity ratio (DER)
- Approximately
0.5 times
- ROIC
- 7% or more
The 26 Medium-Term Management Plan was formulated as a concrete measure to realize our long-term vision.
How will you utilize the lessons learned from the challenges of the 23 Medium- Term Management Plan?
The basic concept of the 26 Medium-Term Management Plan is the "3D Approach for Sustainable Future." We will create synergy through three initiatives: revitalizing of domestic business, further promotion of global strategy, and promoting sustainability management towards carbon neutrality, and link them to improve corporate value. At domestic plants, we will promote the use of blended cement while contributing to the realization of circular economies through the effective use of waste and by-products, and aim to deliver carbon neutrality. Blended cement is in high demand overseas, and the options for selling cement produced in Japan will increase overseas as well, which is a great advantage in the cement industry, where product shelf-life is short. In this way, we expect synergies such as carbon neutral initiatives contributing to the production and sales efficiency of cement.
As the basic policy of the 26 Medium-Term Management Plan, we have set forth Sustainable Growth and Enhancement of Corporate Value of the Taiheiyo Cement Group. Revitalization of the domestic business is essential to achieve growth. We will shift from focusing on market share to focusing on profitability and improve profitability by maintaining appropriate prices. Specifically, we will flexibly adjust the types of cement produced at domestic plants for domestic and overseas markets in light of domestic demand trends and optimize our production system. In this way, we would like to maintain domestic plant operations while also increasing profits overseas. At the same time, we will review our domestic sales structure. In the past, we had sales representatives for each business, such as cement, resources, and an environment services, for each user company, but in the future, we will break down the barriers between business divisions and build a system that can propose total solutions. In conjunction with this, we plan to review our human resource evaluation system.
Overseas businesses, such as those in the U.S., have blossomed as a result of investments and are generating stable profits. In the 26 Medium-Term Management Plan, we will expand our trading business to capture the robust demand in the U.S. In particular, we anticipate increased demand for blended cement on the West Coast, and plan to make growth investments of 150 billion yen, including investments to expand our blended cement businesses. In Asia, we started production from the new line of Taiheiyo Cement Philippines, Inc. in the first half of FY2025. Along with the Philippines, Vietnam, and Indonesia, we will make it a production and logistics base and enhance our presence in the Pacific Rim.
Carbon neutrality and circular economies are particularly important in the Taiheiyo Cement Group's sustainability strategy.
Please tell us about the challenges and prospects for each.
Carbon Neutrality
The development of innovative technologies is progressing smoothly. Regarding the C2SP Kiln, which is our unique and world's first kiln that can efficiently recover CO2 with compact equipment, we plan to establish the technology by 2030 and then sequentially deploy it within the group. A demonstration plant has already been in operation since March 2024, and we have a vision of making it a global standard in a similar way as the NSP kiln became.
On the other hand, balancing economic viability is a challenge. Carbon neutral cement is very expensive, so we have to consider it while keeping an eye on technological innovation and market conditions. In addition, the support of the emissions trading system currently under consideration, government subsidies, and cement standardization is essential. We will continue to work on this as well.
Circular Economies
Cement plants manufacture cement while effectively utilizing waste and by-products as alternative fuels and raw materials. In other words, it can be said that it also plays the role of a waste treatment facility. In Japan, where resources and energy sources are scarce and the lifespan of final disposal sites must be extended due to the limited land area, we believe that this technology, which the cement industry has developed by utilizing its own characteristics, is of great social significance. In addition, natural disasters are becoming increasingly severe every year, and the disposal of disaster waste has become a social issue. We accept not only municipal waste and incineration residues generated on a daily basis, but also disaster waste. This is an important initiative not only for its importance in circular economies, but also for adapting to the future increase in disasters due to climate change. Although the cement industry is recognized as a major CO2 emitter, we would like you to know that it also has aspects that contribute to the environment in this way.
Socially, efforts toward collaborating with circular economies are progressing, and waste that can be used as an alternative to thermal energy is becoming difficult to obtain. Another challenge is that the amount of waste that can be utilized varies depending on the location and facilities of the plant. We will continue to fulfill our social responsibility of accepting waste and by-products by promoting technological development for the acceptance of recyclable waste that is difficult to handle at other industries, as well as by optimizing our production system.

Unloading of disaster waste (wood chips) from the Noto Peninsula Earthquake at Himekawa Port in Niigata Prefecture.
Finally, please tell us your about your enthusiasm for achieving the long-term vision.
In order to realize our long-term vision, it goes without saying that we need to make a solid profit. If we do not make a profit, we will not be able to make important investments toward our growth strategy, nor will we be able to return profits to our shareholders. In recent years, the cement industry has been facing headwinds, but we are finally seeing signs of improvement in profitability and financial strength. We will steadily turn the timing of the peak demand in emerging countries into results. Also, the motivation and sense of fulfillment of our employees are essential to realize our vision. I myself have been involved in the Vietnamese business for 18 years since the establishment of Nghi Son Cement in Vietnam, and I have found the dynamism and excitement of overseas operations to be very rewarding. I would also like to focus on investing in people and creating an environment where they can freely take on challenges.