Announcement of the Medium-term Management Plan for FY2026-FY2028 (“2028 MTMP”)[PDF: 287.0KB]

1. Value creation story and positioning of the 2028 MTMP

   We are implementing growth strategies to achieve Our 10-year Vision (renamed Our FY2031 Vision in the 2028 MTMP to clarify the target year of achievement), which was announced in May 2022. The 2028 MTMP, beginning in FY2026, is positioned as a phase to improve profitability and accelerate corporate value creation.

   With ROE positioned as the top priority KPI, we aim to first achieve the ROE target of 10% set out in the previous medium-term management plan, and then to reach an even higher level in FY2031, thereby enhancing our corporate value over the medium to long term.

   In this context, we have defined four key elements-business, finance, digital, and talent and culture-as the main driving forces of the 2028 MTMP, to build a portfolio with high profitability and growth potential, optimize capital allocation, enhance and accelerate management through digital utilization, and transform our corporate culture.

2. 2028 MTMP key targets (for FY2028)

   1. Financial

      1. ROE	10.0%
      2. ROA	1.7%
      3. Net income	¥210.0 billion
      4. Credit ratings	Maintain A ratings
      5. Payout ratio	45% or higher

   2. Non-financial

      1. GHG emissions vs. FY2019 (Scope 1, 2)	-67%
      2. Percentage of new-generation aircraft	82%
      3. Percentage of green buildings	61%
      4. Effective use of assets whose lease terms ended	97.5%
      5. MHC engagement	75% or higher
      6. Talent portfolio coverage ratio	80% or higher
      7. New value creation from digital-related businesses	¥3.0 billion
      8. Productivity enhancement	Approx. +30%

3. The four key elements

   The strategies for each of the four elements are outlined below.

   1. Business strategy

      • Shift from a growth model centered on asset expansion to one focused on profitability based on the concept of the evolution and layering of business models 2.0, which broadens our value creation from two perspectives:

        • The perspective of value creation methods (the existing evolution and layering of business models that we have pursued under the previous medium-term management plan)

        • The perspective of value creation domains (newly incorporating the concept of stages in the asset lifecycle)

      • Reduce the proportion of finance-centered business models and expand those with higher profitability, such as services, asset management, and operating businesses.

      • Accelerate more selective business portfolio restructuring than before to improve profitability by strengthening growth investments while restraining asset expansion.

   2. Finance strategy

      • Optimize capital allocation to ensure a balance between growth potential, return on capital, and financial soundness.

   3. Digital strategy

      • Create value in business by leveraging asset data and improve productivity through the use of a wide range of digital technologies.

      • Solidify and strengthen foundations by building a data-driven management framework.

   4. Talent and culture strategy

      • Embed a corporate culture that embraces challenge and transformation, and foster leaders that can drive this initiative.

      • Optimize talent allocation, evaluation, and compensation with clear differentiation.

4. Compensation system supporting key strategies (executive compensation) To support the strategies based on the four key elements, we have revised the executive compensation scheme starting in FY2026. In addition to increasing the weight of ROE as the top priority KPI, non-financial KPIs will be incorporated as a new KPI.
5. Each business's growth story

   The recovery of the Global Customer Business and the expansion of specialized businesses centered on Aviation and Real Estate, are expected to drive group-wide profitability improvement and profit growth.

   Segment		Direction of business strategies
   Customer Solutions		Steadily enhance profitability and profit growth as stable foundations supporting the entire group. Accelerate the expansion of high value-added services and enhance the divestment of low-profitability assets.
   Global Customer Business		Restructure the Americas business, and restore and reinforce the Global Customer Business Unit's position as a stable earnings base of the group. Restore earning capacity in the Americas by scaling down the commercial truck business.
   Specialized businesses		Drive group-wide improvements in profitability and profits, led by Aviation and Real Estate.
   	Aviation	Accelerate asset turnover in the aircraft leasing business while scaling up the highly profitable aircraft engine leasing business.
   	Real Estate	Maintain a well-balanced portfolio across finance, investment, and asset management, while increasing the proportion of income gains and sustaining high profitability.

   	Environment & Energy	Leverage our network to strengthen growth support for European Energy, while pursuing medium- to long-term growth through business investments in Japan and overseas.
   	Logistics	Maintain high utilization rates in the marine container leasing business by extending expiring contracts and repositioning containers to demand locations, while acquiring high-quality assets through agile and flexible investments based on an accurate assessment of market cycles

6. Reference materials

For further details, please refer to the explanatory materials regarding our 2028 MTMP available on our corporate website.

Website URL: https://www.mitsubishi-hc-capital.com/english/investors/plan.html

This release is written in Japanese and translated into English. The Japanese text is the original and the English text is for reference purposes. If there is any conflict or inconsistency between these two texts, the Japanese text shall prevail.