"SHIFT 2025 and Beyond" aims to first regain the growth of the Japan business, which is the remaining challenge of "WIN 2023 and Beyond." We will achieve core operating profit exceeding 50 billion yen in the Japan business by 2025 through fundamental reforms over a three-year period from 2023. During the same period, we will implement reforms to improve sustainable sales growth and profitability, aspiring to become a Personal Skin Beauty ＆ Wellness Company. As we aim for long-term growth, we are strengthening investment in the three priority areas of brand, innovation, and people, and plan to achieve our core operating margin of 12% by 2025 and 15% in the plan's final year of 2027.
We will continue to aspire to realize a sustainable world where everyone can enjoy a lifetime of happiness through the power of beauty through our corporate mission, BEAUTY INNOVATIONS FOR A BETTER WORLD.

1.Key Areas for Sustainable Growth
(1)Enhance Brand Equity
In addition to global brands such as "SHISEIDO" and "Clé de Peau Beauté", we will also focus on brands such as "ELIXIR" expanding in Asia, fragrance brands, men brands, and strategicly developed new brands. We will invest an additional 100 billion yen*2 over three years in marketing investment.
*2 Cumulative total increase over 2023-2025 compared to 2022.

(2)Continuously Invest in Innovation
We will further strengthen collaboration between research centers in each region by taking advantage of our global structure. We will evolve our R＆D processes, such as expanding research areas and developing consumer benefits. In addition, we will combine our knowledge with technologies gained by external joint research, inter-company collaboration, and M＆A to create new products and services. To further accelerate innovation, we will invest in R＆D at 3% of sales.

(3)Strengthen Global Talent and Leadership
Based on our management philosophy "PEOPLE FIRST", we have been actively invested in talent development. We will continue this investment in our people, who are the drivers of our growth. This will include selective programs and voluntary career development support for future leadership candidates, acceleration of global talent allocation, and establishment of compensation structures. Furthermore, to commemorate the 150th anniversary of our founding, we will open "Shiseido Future University" to develop the next leaders. This is based in Ginza, Japan where our company was founded, and Masahiko Uotani, Chairman and CEO, will serve as the first president.

2.Core Initiatives by Region
Achieve continuous growth and shift to a highly profitable structure through active investment.
1) Japan: Strengthen brands and organization. Rebuild earnings base by bringing back growth
2) China: Expand brand portfolio and develop new areas
3) Asia Pacific: Establish a business foundation in a promising market for the future
4) Travel Retail: Create unique value for travelers
5) Americas: Build a foundation for growth as the next growth pillar
6) EMEA: Achieve profitable growth after past structural reforms

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Shiseido Co. Ltd. published this content on 10 February 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 February 2023 06:19:03 UTC.