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TODA KOGYO was founded in 1823 as a manufacturer of Bengala, a red pigment that is essential for the painting of porcelain, lacquerware and historical buildings. At the time, Bengala was made from iron sulfide ore, produced as a by-product from mining through a manual process of baking, crushing and grinding. Later, the TODA KOGYO Group established proprietary fine particle synthesis technologies such as wet synthesis to provide inorganic materials based around iron oxides to various companies.
Looking back on the history since our founding, the Group has continued to develop and provide new materials and solutions in step with changing social needs. Underpinning this is the Group's management approach, which seeks to always look to the next generation while at the same time regarding customer needs as a starting point. An example of this is when I joined the company in 1984. The magnetic recording material business was expanding due to the widespread adoption of audio cassettes, but at the time, top management was already stepping up its R & D and marketing efforts in anticipation of future social needs. Those efforts lead to the launch of a business producing materials for photocopiers and printers to follow on from the magnetic recording material business. At the time, we were among the first to respond to the introduction of new technologies using magnetic toner in the photocopier and printer market, and managed to meet demand by developing and manufacturing the needed materials. We continued with this forward-thinking approach subsequently, taking on the challenge of manufacturing materials for lithium-ion batteries (LIB) in an effort to cater to a market with potential for future growth. The LIB materials developed through the fine particle synthesis technologies cultivated in the magnetic recording material business were first applied to mobile phone and PC applications, and today are used as battery materials for electric vehicles. The magnetic material and dielectric material markets, which are currently regarded as growth businesses, are also materials we have been developing in anticipation of the maturation of magnetic recording materials. Magnetic materials serve growing demand in applications for motors and sensors due to the electrification of vehicles, while dielectric materials are increasingly used as materials to meet demand for more compact laminated ceramic capacitors used in smartphones and other devices. In these ways, the Group has continued to grow by always anticipating societal changes, considering what society will demand next and how its core competence in fine particle synthesis technologies ties in to those new needs.

The TODA KOGYO Group is currently implementing its three-year medium-term business plan Vision 2023 was began in April 2021, and has established Go Beyond 200 as its vision for fiscal 2024 and beyond. Through these endeavors we will enhance profitability in our core functional pigment business while pursuing expanded sales of magnetic, dielectric and LIB materials in the electronic materials business, which we regard as a growth business. We will also work toward the commercialization of soft magnetic materials and environmental materials as next-generation businesses.

The environmental materials business started at TODA KOGYO in the 1990s. At the time, the release of dioxins from waste incineration plants was a social issue. We developed and provided a dioxin-suppressing combustion catalyst, utilizing its function of promoting the complete combustion of iron oxide. Starting in the 2000s, we began collaborating with universities and other institutions to utilize iron-based catalysts and other materials to develop the direct methane reforming (DMR) method which generates hydrogen and carbon (carbon nanotubes) from methane in a way that produces no carbon dioxide. In August 2023, we began using this technology in Japan's first demonstration experiment to produce hydrogen at commercial scales from natural gases including methane in the Toyotomi, Hokkaido Prefecture. We will steadily proceed with this demonstration project while continuing to expand the environmental materials business in Japan and overseas in the future.

The TODA KOGYO Group also regards ESG initiatives as important in achieving sustainability management. On the corporate governance front, the Group has also worked to strengthen governance while enhancing the transparency and independence of the Board of Directors. And on the environmental front, we have disclosed greenhouse gas emission reduction targets as an internal initiative while conducting the scenario analyses required under the framework of the Task Force on Climate-Related Financial Disclosures (TCFD).
We have made our human resources strategy a particular focus. TODA KOGYO is a company founded on technology where a third of all employees are involved in development. While continuing to invest in human resources to refine our unique fine particle synthesis technologies on an ongoing basis, we also recognize the importance of rotating employees through multiple departments while maintaining an engineering group fulfilling a wide array of roles. But not all of our employees are required to have a background in chemistry. Above all else, the qualities we value are passion and motivation toward the creation of new value, and a willingness to work in a genuine and serious way in cooperation with others.

In anticipation of our 200th anniversary, in January 2023 we established the TODA KOGYO Group's purpose (reason for existing) as "make the potential of find particles into the potential of the world." This was the result of extensive discussions on the future of the Group by a team mainly comprising mid-level and junior employees. As expressed by a part of the accompanying statement which reads, "a single fine particle holds unlimited potential," since its founding the Group has continued to embrace the challenge of creating new value that represents hope for the future. The Group will continue to push forward based on its belief in the potential of fine particles and people in order to fulfill its social role of supporting people's daily lives and society as a whole. And to meet the expectation of our stakeholders, we will aim to help solve social issues and achieve the sustainable growth of the TODA KOGYO Group through the business activities we pursue together with our employees. Thank you for your continued understanding and support.