Message from the President

To Our Shareholders and Investors

Let me begin by expressing my gratitude for your continued support of IBIDEN CO., LTD. and the IBIDEN Group.

The fiscal year ending March 31, 2016 marks the halfway point of our consolidated medium-term management plan, “Challenge IBI-TECHNO 105,” for the five years started from April 2013. Guided by the plan, we have been putting into practice our corporate philosophy, the “IBIDEN WAY,” to strengthen our corporate structure for the next 100 years. Specifically, we have carried out improvements by applying our unique methods such as “5S,” “Genchi (actual scene),Genbutsu (actual thing) and Self-sufficiency (on-site solution of problems),” and our Self-Completing Management. Through activities involving all employees, we aim to achieve not only the best customer satisfaction, and thus attain our management goals, but also firmly establish a “positive spiral,” in which individual employees aim to fulfill higher and more challenging goals while improving skills and teamwork with a great sense of satisfaction and accomplishment. In addition to these activities, we have been working to further boost competitiveness in all business segments as follows.

In the Electronics Operation, which was significantly affected by the rapid spread of smartphones, we implemented a transformation of our business structure that integrated three divisions of IC package substrates for personal computers, IC package substrates for smartphones and printed wiring boards (PWBs), to respond to changes in the business climate. Owing to the synergy effects of the integration, we succeeded in boosting our level of unique technologies and further improved production efficiency. Closer collaboration with the three divisions makes it possible to respond to a wide range of product needs, and business management with the perspective of overall optimization enables the three divisions together to support the Electronics Operation as a whole. This operation is once more becoming a mainstay of the Group’s earnings. In the Ceramics Operation, we enhanced the production system for diesel particulate filters (DPFs) for large vehicles, which are expected to spur market growth due to tighter exhaust emission regulations. For existing products for small and medium-sized vehicles, we achieved thorough cost reductions and strengthened our competitive edge. In other operations, domestic Group companies are actively developing their own businesses and new products with a rich complement of features. For more detailed information, please refer to the “Special Feature,” which introduces new products in the Housing Materials Operation in our 163rd Semiannual Business Report (in Japanese only) issued in November 2015.

With respect to global CSR management, to which the Group is firmly committed, the June 2015 implementation of Japan’s Corporate Governance Code led us to promote the development of internal systems in line with the spirit of the code. In addition, in our future CSR management we will continue to reflect the valuable opinions and requests received from shareholders and investors through, for example, investor relations activities and the general meeting of shareholders.

With regard to the Group’s operating environment, there are concerns that the launch of a competitor’s fan-out wafer level packaging (FO-WLP), scheduled in 2016, may negatively impact the CSP Operation, and that reduced demand for diesel vehicles, triggered by the Volkswagen problem, may affect the DPF Operation. Although business conditions are continually changing over time due to risk factors, the IBIDEN Group seeks to establish a strong and flexible corporate structure that will enable it to achieve sustainable growth and stable profits over the next 100 years.

Lastly, regarding the return of profits to shareholders, we give top priority to the payment of a stable and continuous dividend to shareholders by targeting a medium- and long-term dividend payout ratio of around 30%. In line with this policy, we decided to pay an interim dividend of ¥15 per share, the same amount as in the period last year, because the outlook for the Group’s market environment remains uncertain. For the fiscal year ending March 31, 2016, we plan to declare cash dividends of ¥20, the same amount as in the previous fiscal year.

Meanwhile, by resolution at the meeting of the Board of Directors held on October 30, 2015, we decided to acquire treasury stock (the total number of shares to be acquired is up to five million shares, and the total amount of shares to be acquired is up to ¥10 billion) and to retire 10 million shares of treasury stock. Based on these points, after comprehensively taking into consideration such factors as our financial status and stock market conditions, we will continue to implement flexible capital policies in accordance with the business environment and to boost shareholder value.

We thank you for your continued support and understanding of the Group.

November 2015
President & CEO
Hiroki Takenaka