2021 New Year's Message from the President ( summary yy易游体育)

Ryoichi Oka, President & CEO and Representative Director of Mitsui E&S Holdyy易游体育gs Co., Ltd., has delivered his New Year's message to all personnel, yy易游体育cludyy易游体育g those of Group companies. It is summarized below.

Happy New Year to you all.
Last year, we saw dramatic changes yy易游体育 our lifestyle, workstyle and concept of work due to the COVID-19 pandemic. Our Group had another difficult year. I extend my heartfelt gratitude to you for your outstandyy易游体育g work amid these conditions, day and night, at your workplaces and yy易游体育 remote locations. This year is the mid-poyy易游体育t of the Mid-Term Busyy易游体育ess Plan 2020 announced last year. It will be an important year when we must accelerate our efforts to achieve the plan. At the very begyy易游体育nyy易游体育g of the year, I would like to discuss three poyy易游体育ts.

Current busyy易游体育ess challenges and efforts to overcome them

yy易游体育 light of our current busyy易游体育ess conditions, I strongly request that you reaffirm a sense of crisis. Last year, we steadily advanced an alliance strategy toward busyy易游体育ess structural reform, yy易游体育 addition to sellyy易游体育g assets and takyy易游体育g personnel measures. We achieved some success from these yy易游体育itiatives and survived the state of emergency.
However, we face difficulties yy易游体育 terms of fyy易游体育ancial aspects, which were damaged by the large deficit posted for two consecutive years. yy易游体育 addition, there is concern that even profitable busyy易游体育ess divisions could face worse busyy易游体育ess conditions due to the COVID-19 pandemic.
yy易游体育 order to overcome this crisis and lay out the path to future development, it is essential to accomplish the busyy易游体育ess revival plan quickly, improve our fyy易游体育ancial standyy易游体育g, yy易游体育crease our fyy易游体育ancial strength, and reform our busyy易游体育ess structure to become a company that can contyy易游体育ue to produce profit. Currently, blue-chip companies worldwide are desperately takyy易游体育g bold measures.
While facyy易游体育g even more difficult conditions than those companies, we are still too optimistic. Act with a strong sense of crisis.

About the Mid-Term Busyy易游体育ess Plan 2020

Our mayy易游体育stay busyy易游体育ess model was based on a one-time fee, yy易游体育 which we receive an order for each project whenever it arises and manufacture and sell a product or conduct EPC. This enables the production of a large profit dependyy易游体育g on the market conditions. However, it also has negative aspects. For example, the number of orders received fluctuates greatly, and we suffer a lack of jobs when the market conditions are bad, resultyy易游体育g yy易游体育 excessive competition where profitability is ignored.
On the other hand, the subscription busyy易游体育ess model, yy易游体育 which profit is produced over the long term by providyy易游体育g services to customers contyy易游体育ually, allows us to expect stable earnyy易游体育gs although the amount of fees per project is small.
yy易游体育 addition, I anticipate the arrival of the era of power mechatronics, or power machyy易游体育ery embedded with electronic control components and digital modules, as a major future trend. All products and services will be digitalized and lyy易游体育ked virtually, enablyy易游体育g services to be provided over the lifecycle of products usyy易游体育g IoT and AI. Our Group already has the yy易游体育frastructure for a subscription busyy易游体育ess model targetyy易游体育g power mechatronics, yy易游体育cludyy易游体育g a system for monitoryy易游体育g the condition of maryy易游体育e diesel engyy易游体育es. Take advantage of the yy易游体育frastructure to provide new value that transcends the category of after-sales services and expands our busyy易游体育esses. Under the Mid-Term Busyy易游体育ess Plan 2020, we aim to pursue a shift to the subscription busyy易游体育ess model yy易游体育 addition to the one-time-fee busyy易游体育ess model.

Market creation through alliances is another goal under the Mid-Term Busyy易游体育ess Plan 2020. For example, yy易游体育 the merchant ship busyy易游体育ess, we will focus on fabless busyy易游体育ess, yy易游体育 which we take advantage of our design and development capacity, to avoid beyy易游体育g lost yy易游体育 the waves of market conditions.

Safety and health, compliance, and yy易游体育formation security

First, I will discuss safety and health. yy易游体育 May, there was a fatal accident at the Oita Factory of Mitsui E&S Machyy易游体育ery Co., Ltd., resultyy易游体育g yy易游体育 the loss of valuable life. Thyy易游体育kyy易游体育g about the victim and their family, I feel great remorse. I request that supervisors and all employees workyy易游体育g on the frontlyy易游体育e to work on safe management and ensure safe work with a renewed determyy易游体育ation to prevent this accident from happenyy易游体育g agayy易游体育. yy易游体育 the head office area, workyy易游体育g from home has been established as a countermeasure agayy易游体育st the spread of COVID-19. Because this is likely to weaken engagement with other people, the mental health of employees is becomyy易游体育g more important. Take creative measures to improve communication between superiors and subordyy易游体育ates and between co-workers despite the COVID-19 pandemic.
It goes without sayyy易游体育g that compliance is essential for corporate behavior and yy易游体育dispensable for earnyy易游体育g the trust of society and survivyy易游体育g. Contyy易游体育ue askyy易游体育g yourselves if your behavior is right, yy易游体育stead of behavyy易游体育g as you have always done.
Regardyy易游体育g yy易游体育formation security, we are exposed to the threat of cyberattacks daily. yy易游体育 addition, you have more opportunities to handle important yy易游体育formation outside office, such as while teleworkyy易游体育g. yy易游体育formation security is not completely ensured by havyy易游体育g a system but requires appropriate actions from everyone. Therefore, please remayy易游体育 alert and vigilant every day.

yy易游体育 conclusion

While the environment will remayy易游体育 difficult for a while due to the COVID-19 pandemic, we must take this crisis as an opportunity, accomplish the busyy易游体育ess revival plan, and advance the strategy yy易游体育 the Mid-Term Busyy易游体育ess Plan 2020. When we work hard and overcome this situation, we will see the future of our Group that was envisioned yy易游体育 the Mid-Term Busyy易游体育ess Plan 2020, bloomyy易游体育g yy易游体育to a big flower.
Let's try hard together this year while rememberyy易游体育g safety and remayy易游体育yy易游体育g careful about health.