First of all, I would like to cover two pages, and this is what we are aiming at and positioning the resin business. In the first line, we state our characteristic: we are to meet diverse needs of customers and patients. Every time I read this sentence, I believe that any company would have this kind of relationships based on trust, so this is a common sense. But then we do have high expertise and professional know-how, especially in fiber areas, and also with the same degree of professionalism. We have our home care services or the healthcare business services, and I believe that is our characteristic, and with this, we are to meet our customers' demands, so this is what we call the business model that is customer-centric. We have to realize this model and to support the Teijin going forward.
As for the resin and plastic business, as you can see, now we have the thorough co-creation of solution and community idea combination of technologies to understand and meet the demands of our customers, now the fact that we are able to perform thorough proofs that we are able to utilize our high expertise area in fibers, and also we do have our medical know-how where we truly understand the needs of our customers, so this is not only about a single material or the service, but we are able to offer many different combinations, hundreds of them, and then by creating or combining this expertise, we're able to create new businesses that our customers truly require, now in the area of fibers, our home care, healthcare services, we do have power in our plastic resin business.
In the next term, we are aiming at increasing our ROIC level even further. That's what we are aiming at. We do have some history in the past. On the left side, now in 2024 and 2025, in two years midterm, we have been working on a divestment of underperforming businesses, especially the e-comic businesses or the North America commercial business. We have divested them. Also in addition to that, we have been active in a divestment. There's our Media, P aper, and Logistics business and the Pharma business, which we have already divested. The reason why we have been working on this is because we have limited resources, human resources, and materials, and budget. We are focusing on our expertise area. That means the fiber and the healthcare and the resin.
And for the fiber products that we have recently announced with Asahi Kasei Advance, we are to compensate each other and be integrated to expand our product areas even more. And then there is acquisition of Unitika's spunbond business, although this is small in scale, and also Toyobo's airbag business acquisition in China. So with this, we are expanding and strengthening our fiber products businesses. And healthcare also, we are utilizing our home healthcare platform for further acceleration. And for the resin and plastic, now we are able to thoroughly practice our 3Rs and circular economy, so we are going to strengthen them further. And then we should not forget Aramid. We are facing difficulties, but we are proceeding with the cost restructuring. And then we are to realize our customer centricity. So this is what we are aiming at. And that is all for the explanation for now. Now, Akitoshi Hama, from the resin and plastic business, is going to explain.
My name is Akitoshi Hama. I'm the General Manager of the Resin and Plastic Processing Business Unit. Thank you very much for giving me the opportunity to speak today. I'd like to provide you with the overview as well as the medium to long-term strategy. First of all, I'd like to go over the overview and then the characteristics and strengths, followed by medium- to long-term strategy. I don't really have many opportunities to explain about our resin and plastic business. So today, I will have to go over some basics. So here is our overview history. As a plastic resin business back in 1948, we started manufacturing filaments. And then we moved on to the polycarbonate resin and flame retardants and resin sheets. And as for the polycarbonate, already we have over 60 years of history.
And also around the year 2000, we've been supporting our customers' global expansion. So we started going into the overseas as well. And then as you can see in this chart, there's a factory in Singapore, and we stopped them in 2015. And as for our business locations, the red colors indicate our factories, and the blue sales and marketing, and the yellow is research and development facilities. And as for R&D facilities, we support our customers' development, and we have locations in Japan, China, and Thailand. And as for the sales, we are global, and we support our customers and also support the materials. And as for the sales breakdown by region, we are concentrated in Asia, especially in China. It accounts for over 50%. And then of our China exposure, we are now domestic China consumption is about 50%, and the remaining 50% is the processing part.
And now our customers are in Europe and North America, so there is re-exporting. And then we are mostly in Asia. And for Europe and North America, our direct sales volume is quite small. So we are quite Asian-centric. So here's about our performance trends. These bars indicate our revenues and profit. And this red line, this is our operating profit. And orange color is our market polycarbonate and material BPA spread. And as you can see, since 2005, now PC resin for the CDs have been decreasing demand also. The costs are increasing, and it is deteriorating our PL. And this is quite volatile, as you can see. And also in 2015, we closed our Singapore plant. And then we've been shifting to further cost cuts and higher value products. And then we've been able to stabilize our PL. And then in China, we added PC resin facilities expansion.
And then there's been increasing competition over there. And if you look at our PC BPA spread, this is at the lowest level ever. But still, we're able to generate profit in a stable manner, and our ROIC is now over 10%. And here are our major products. We are focusing on polycarbonate resin, and we also have functional resin and functional chemical materials and resin processing material. And as for the functional resin, we have the special polycarbonate. And now we use non-BPA materials for smartphones and lenses. And that is the special polycarbonate. And also we do have the polyester resin and PPS compounds. And as for the functional chemical, we have the brominated flame retardants and then polycarbonate sheets processing material as well. And polycarbonate resin accounts for about 80% of the revenues.
I think many of you might know this is about characteristics of PC resin. This is a comparison to other engineering plastics, especially they are excelling in transparency and impact resistance. There is a good balance. For the PC resin alone, what we call the natural. For that kind of application, especially when it comes to transparency and impact resistance, this works really well and is used in automotive headlights and optics.
So the natural, we do have the compound in our business. So when it comes to resin compounds, they're based upon the base resin we use. We use the PC as a base resin, and we combine with other materials to control the well, implementability, for example. Therefore, that we have some added complementary characteristics by added combining other material. This is the well compounds. So we have several different types of the characteristics. For example, because of this, that the well compatibilities are different, we do have some conflicting characteristics. That is why that it is very crucial for us to decide that the blending ratio of materials. This is where we have the know-how, and this is a source of the value addition for us. Next is the trends of PC resin sales. So this blue bar that indicates natural yellow compound applications.
So as you can see from here, the natural applications have been dwindling. Well, because these are the general purpose areas, then we have seen some reductions. And just recently, we have been centering around compounds. So even in the case of natural, we have been centering around the, well, more elevated area to stabilize that sales. The PC as a whole, that we account for some 5% in when it comes to compound, our share is about 10%-15%. Therefore, our share is not so high in this market. However, we have focused on the high value added product. So now one, so I'd like to talk about our characteristics and our strengths. So one of the major characteristics we hold is as three different areas. One of them is that the, well, quality and also stabilization and also the confidence.
We actually maintain the high level of quality. We have contributing to the high yield of the customers. Another one is the attention to the customer's needs. We have very close communications with the customers in trying to address and resolve the challenges the customers are facing. And also the last one is the best product lineup, as I mentioned earlier, in advanced PC, the compound chemicals. We actually provide several different products contributing to that, well, solving the customer's different problems. So these are not very specific, actually, that's about those three areas that we have deepened our knowledge in those three areas. So that we have already created a good confident relationship with the customers in trying to help customers to solve the problems. So as a result, we can continue to carry out existing contracts.
We have received new requests as well. This is the cycle of the long-term business. This is a source of our strengths. About the quality stabilizations, I'd like to give you more explanation. About the PC resin, the natural and compounds, we have two segments. First, the PC resin. We have a special polymerization method to control quality variations. Compared to Chinese manufacturer, we do have advantages in quality. More specifically, the reaction proceeds uniformly, stabilizing the properties. Also, the reaction temperature is low, suppressing thermal degradation and discolorations. Also, by washing, it is possible to remove unreacted raw materials. We can actually reduce the yellowing matters. Also, the material can be utilized in compounds. Therefore, we have the high level, high quality PC resin manufactured by us.
By using such PC resin, we have the natural, even distribution of the additives, and therefore, the compatibility of the different materials can be highly achieved, so it goes by expertise in the compounds as well as the PC resin area, and also we establish the technical centers in overseas production area, so that is why we can minimize the difference between prototypes and mass production. Furthermore, for long times, we have customers who require high level of quality. We have had a very strong relationship with such customers. That is why we have improved the quality indicators well for a long time. That is why we can contribute to the stabilization of the production by customers and also the high yield of the customer's production. I just touched upon the technical center overseas.
So, PC compound development production, I'd like to give you more of the additional explanations. As I had mentioned earlier at the very beginning, that, well, in Japan, China, and the ASEAN, we already established technical centers and production factories. So in each area, that we have a close communication with the customers. So we try to understand the different customers' needs. And we have a good process, repeat the process of that, well, listening to the customers and also evaluation by the customers. So once the grade is developed, we can establish a good production technology to continue that the stable production. So in trying to realize this, we have two strengths. Here are some examples and the descriptions. So we have the different types of lineups of PC and also compound.
In other words, that in relation to the specification requirement by the customers, we can establish that the melt functionality required by the customers, and also we have to accumulate so much recipes, including that the compatibility and also additives in a speedy manner that we can contribute to the resolution of the problem by customers, so these are our strengths and also the points we have been highly evaluated by the customers, so we have repeated this process in a steady manner. This is the actual production and also quality control. We have exercised for as a result in the PC and the melt. We have seen that the increase of the players. Our positioning is shown in this chart horizontally. Customers that the melt ability to achieve properties required by customers and vertical access to quality stability.
So that we try to listen to the requirement by the customers. I think so we make every possible effort to achieve the properties. We are ahead of others and also quality stability in trying to achieve the requirements of the customers. We have maintained that very high level of stability and quality. So that, well, of course, each company has its own strategies. We have seen that we emergence with so many players, but we have been chosen as one of the major players to contribute to the customers. So we do carry the different lineups of products we already explained to you. So in principle, we utilize our PC resin base. And we have a very unique characteristics of the lineup of the products. So as a base for the revenue PC resin, which is followed by the functional chemicals with the detergents.
This is the stable source of the PC resin business, the profit. For the last years, that we have made an investment into the functional chemical and resin processing materials. These two will be that source of the sales and also the profit. When it comes to the retardants, I'd like to explain to you. This flame retardant business, we have stabilized ourselves. This has been contributing to the stabilization business. Our retardants, well, that we can utilize that one of the processes of the production. The actual major product is a brominated carbonate oligomer BCO flame retardant, which can be produced using parts of the PC resin production process. This type of BCO flame retardant has a very high level of flame retardancy and also high flame retardancy and excellent heat stability.
And also that we have a good compatibility with the PBT-based applications in the automobile and also as well as electronic connectors. Just recently, we have application for the data servers and electric vehicles. We have a steady progress in the future. This kind of business is going to grow on a steady basis.
And also regarding the PC flame retardant market, this is not a big market, but there are not many competitors. And our supply stability is very highly assessed, and we do have a large share. And this is going to make further contribution to stabilize our revenues and profit. And from here, I'd like to discuss medium- to long-term strategy.
Now, we do have our vision to be a company that supports the society of the future. And that is what we are based upon. And we do have the mission value statement here on the same page. And as I mentioned earlier, we have the development capabilities for the high performance material, and we have a high trust and a strong customer base. And then using them, we are not already limiting ourselves to the particular application areas, but we cover wide areas and leverage our capabilities to support our customers' manufacturing process and also sustainability of the society. And that's for our value. Now, there are three points that we value in a sense of foundation. We constantly pursue material development capabilities and also our trust through market-oriented and customer-oriented approaches. And now there are different requirements from customers and challenges. So with enthusiasm, we are taking the challenges. So this is what we are based upon in the past decades. And this is our perfect target image.
And we can really quantify how much in an amount. And we have the PC resin and non-PC resin that is in the lighter color. And PC resin accounts for a high percentage in our profit. And then in three to five years' time, as for the PC resin, the competition is going to be even more fierce. That is for sure. And we continue to work on high-value products and realize circular economy to stabilize our profit. And of course, we are aiming at achieving even higher growth. But at a minimum, we are going to protect our profit level. And then there have been investments in non-PC resin areas. So sales and development activities have been making some progress. And in the upcoming three years, we are going to materialize what we have been working on to increase the non-PC resin part.
For the five, ten years' time, we are to start new businesses and work on development now. We are to nurture them to be the next pillar. We are now working on changing the profit structures of the entire resin business. That's what we are working on. This is about understanding of the environment. Once again, we are facing some difficulties, and we recognize that. As our first point, there have been changes in the PC resin market environment. There has been increasing capacity in China. Also there are new PC resin makers, and they are now increasing their quality. Here you can see the supply-demand balance for the PC resin. For the upcoming three years, we already see capacity is increasing, and that's already announced.
So if they are going to materialize, then supply and demand is going to deteriorate even more. And as for the customers, there has been an ASEAN shift from China, and this has been accelerating in the past years. And we see this as an opportunity. And about sustainability, growing demand. There has been a demand for the materials with a low environmental impact. And this is the opportunity for us. And then including PFAS, there are concerns about restrictions on the use of certain materials, substances. And this could be negative, but we see this as a positive factor. And then electrification and autonomous driving and improved comfort of automobile and AI. These are all about new demands. So while we are to capture them. And then also paperless operations. We do have printer manufacturers as important customers, but there will be less equipment demand.
So this could be negative for us. And then in this environment, here we have some priority measures. In this severe environment, we are taking on these initiatives. And without these initiatives, we will have to result in competition. And here we state four points. And we are to comprehensively execute these plans to increase our profitability. For one thing, in growing areas, we are to develop and increase the sales of the high-value products. This is mostly about automobile and semiconductors. And we've been already working on this for several years by now. And then another area, there are some overlaps to the priority applications. There are different trends based on region. So in each region, we are to capture customers' demand. And that will have to be reflected in our sales activities.
In past years in China and ASEAN, there will be a strengthening of our sales and development organizations. Another thing that is about contributing to the circular economy. This includes circular material product development and also PFAS-free product development. And this is something other companies are working on as well. And we are working on a premise that we will be able to secure profit through these initiatives. And we are quite active in the development. One more thing is about cost reductions. Now the first point is to promote sourcing of materials at competitive prices. And also we are not at full operation. So we are to shift to cost structure that aligns to operation. And then use automation process and the DX to increase productivity. So we are to execute these four pillars of the plans to get the tangible impact.
As for the focus areas, now the growing areas may change depending on time. For these changes, we are to pursue the functions that are required. Currently, it's about automobiles and semiconductors and medical. These are our priority areas now. That's our focus in our sales activities and also in development. In addition to stable quality, we are able to secure the material that meets these new demands. For these application areas, there are certain areas that are expected to grow. For the automotive, we are enhancing in vehicle comfort and also the more charging stands and daytime running lights spreading. These are the requirements. For that, we do have these actions to develop the products for the appropriate grades. Semiconductors, that's still expanding. There's China's policy to promote domestic production.
Also, the fast and larger capacity communication requirement is another thing. We are to find IC manufacturers in China among other initiatives. Medical, also, there has been an aging society in China. We are now working on a new development for the new aging population. As for the circular economy, we are now behind requirements ELV rules in Europe. There has been a rapid increase in demand, so our sales volume also has doubled in past years. Now you can see, this is the expected cost versus quality on a horizontal axis. Customers are requiring diverse circular economy materials. Now it's about material recycling and biomass. That's what we sell. For these application areas, we are preparing the suitable grades, then in addition to that, we work on cost-effective solvent-based recycling technologies that we are now developing.
When it comes to the solvent-based recycling, well, for example, we try to remove the volatile matters by the existing other technology. However, it is not always possible. That is why by using that solvent, we can achieve the quality the same as equivalent to that of the virgin materials. That is why this is why we can actually contribute to the CO2 reductions and also the recycling of the other resources. So that for the mass productions in 2026, this is at the commercialization day. And we are working for this at this moment. So the volatile matters can be removed. So that is why in the current material cycle, we have some limitation of applications, but we can actually expand the applications. And also the material sources can be expanded, that we can utilize a more broad range of the recycled materials.
And also we will utilize existing additive processes. Therefore, we don't have to have the large-scale investment. We can achieve the mass production in early stage. So towards that mass production, we have been working for this. Next, well, special polycarbonate is the smartphone lenses. For example, you know that these are the combination of the different layers of the materials. In this particular area, for the last few years or so, the other companies have been ahead of us. But the smartphone and also that the other additive application to the automobiles, perhaps we can utilize our technology base to such applications. So that this area, this specific topic has been chosen as one of the wider focus areas. And also the refractive index is a vital range. And if the refractive index is high, we can manufacture the thin lens and also the base materials.
So in the case of the volume zone, some of the companies are ahead of us. In our case, the high refractive materials will be our focus. We can actually, well, be attentive to the high-quality needs. So we like to differentiate ourselves from others. And also the, well, AR/VR is going to rise in demands by using our characteristics. We have been already started the development. And for the future at the markets and the case of smartphones, well, but we still add the foresee that the slow growth. We have some, we still have the requirement of our customers. And in the case of the VR device, which is going to grow sharply. So by taking advantage of the technology, we like to catch-up more, pick up more, add the demand.
For the last three years, we have seen the effectiveness of development. However, the achievement is not the one that we like to be proud of. So therefore, well, for the three years, we like to still make an effort. We like to expand the market other than smartphone applications. Lastly, about the PPS compounds and the resin products, I'd like to give you some additional explanations. So in this area, by using our characteristics, we'd like to enlarge the market. About the, well, PC sheets, well, profitability of the general applications has been dwindling. We are facing the severe stressors. However, we do have added the characteristics, for example, the appearance, the enlarging modification capabilities. Last year, we started to manufacture the new sheet line.
For example, the hardness and also thin, smooth the film so that, for example, this kind of the film can be utilized in heads-ups and also the decorations in the automobiles. We like to take such demands. We have seen that the customer base increase. Also, PPS compounds that we have a partner company in South Korea. For some time, we have seen the delays in stabilizing the polymer plant operations. But nowadays it has been stabilized. That is why we already started the user works, but we are still left behind. Therefore we cannot actually compete against others only by the existing additive method. We do have a special methodology so that our product has very different types of the additive characteristics.
That is why, for the three years that our product has been highly appreciated by the customers, and also PPS can be applied into the data servers and also the automobiles. We can still have a very good focus for the high demand, so we'll be able to increase our profit in this field as well. For the last three, well, we already touched upon our long-term strategy business objectives, PC resin. We are going to maintain the profitability by high value-added products and also circular economy, and also non-PC resin, well, we'd like to create a new profit pillars by expanding profits in functional resin and the processed products. So these are the areas which actually sustain the profit of the segment, and also we have a future perspective by using those. This concludes my presentation. Thank you very much.