(1) Basic management policy

The Unitika Group's management operates on a principle of "connecting persons' lives to technologies for social contribution," and aims to be "a company that contributes to persons' lives and the environment, and which has a social presence." The Unitika Group firmly believes that our contributing to society whilst promoting the "enforcement of structural reform," "establishment of an infrastructure as a functional material manufacturer," and "reinforcement of corporate constitutions and shareholders' equity" will increase the corporate value of the Unitika Group and ultimately contribute to increased returns for our shareholders.

(2) Target management index

The Unitika Group attaches importance to sales, operating income, and recurring profit which indicate the outcomes of our business activities. From the viewpoint of reinforcing financial strength, while improving the capital adequacy ratio and reducing interest-bearing liabilities, we also attach importance to cash flow and apply priority control.

(3) Mid- to long-term management strategies and challenges to be handled by the Company

In light of the severe operational results for the last fiscal year, the Unitika Group drew up a new 3-year mid-term management plan entitled "Reform '11" to be applied starting in FY2009. According to this plan, we will promote a "structural reform" that focuses on business restructuring of our loss-making and unprofitable sections, as well as reducing our fixed expenditures, in order to drastically improve our revenues. By steadily executing these measures, we are aiming to stabilize our revenue infrastructure as early as possible and concentrate our management resources on those sections that are exhibiting growth, as well as promoting our growth plan to improve and reinforce our business strength with "functional materials", centered around the high-polymer and functional material sections, aiming at an ordinary profit of 10 billion yen in the final fiscal year of the plan.