In the business environment surrounding Business Wear Business, which is the core business of the Group, the working age population is decreasing and office wear is becoming more casual. We recognize that it is even more important to shift from a "One-person Management" centered on suits and formal wear sales and focus on growing fields.
In this business environment, in formulating the Medium-Term Management Plan, which ends in the fiscal year ending March 2027, we will further advance the management vision of the previous Medium-Term Management Plan, "Innovation and Challenge of Business Wear Business" and aim for sustainable growth through "Scrum-type Management" in which each organization faces customers, is self-reliant, and collaborates.
The Medium-Term Management Plan is positioned as a three years period for the implementation of specific strategies to achieve the vision we aim for. By the fiscal year ending March 2027, the final year of the Plan, we aim to achieve consolidated Net sales of 210,000 million yen and consolidated Operating income of 17,000 million yen.
Fiscal year ending March 2027 Plan |
|
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Net sales | 210,000 million yen |
Operating income (compared to Net sales) | 17,000 million yen (8.1%) |
Profit attributable to owners of parent (compared to Net sales) | 12,600 million yen (6.0%) |
Return on equity (ROE) | 6.6% |
In addition to promoting the following five basic strategies, we will promote management that is conscious of the cost of capital and stock price, taking into account the viewpoints of shareholders and investors.
Maintaining and improving the earnings power of existing Business Wear Business stores
Expanding market share by opening new stores Business Wear Business
Promotion of profit-oriented management
Investment in existing stores, new store openings, recruitment and development of human resources, DX, replacement of core systems.
Reduce and restrain headquarters expenses while prioritizing investment to strengthen management foundation such as development of logistics infrastructure.
Strengthening Group Governance
Initiatives for sustainability
At the Board of Directors' meeting held on November 12, 2024, the Company reanalyzed the current situation and clarified its recognition regarding measures to realize management that is conscious of the cost of capital and the share price, and resolved on a policy for initiatives to improve corporate value.
For details, please refer to the following presentation materials.
Second Quarter (Interim Period) Financial Results Briefing(PDF 3.2MB)
The Company will return profits to shareholders based on policies set for each of the Medium-Term Management Plan.
As for the return of profits to shareholders during the new Medium-Term Management Plan period from the fiscal year ending March 31, 2025 to the fiscal year ending March 31, 2027, the Company's basic policies are to actively and stably return profits to shareholders while investing in growth to maintain and strengthen competitiveness and working to improve earning capacity and strengthen its financial position.
In addition, to realize management that is conscious of the cost of capital and the share price, and to further advance initiatives to increase corporate value, we will adopt the higher of the consolidated dividend payout ratio of 70% or the dividend on equity ratio (DOE) of 3% and we will improve capital efficiency and increasing dividends over the mid to long term and pay dividends through profit growth.
The company will flexibly conduct share repurchases with the aim of improving capital efficiency, while taking into account business performance, capital conditions, and market conditions, including stock prices.
During the period of the Medium-Term Management Plan, the company will purchase up to 10 billion yen of its treasury share, starting with 3 billion yen of share repurchase during the fiscal year under review.
We plan to generate a total of 50 billion yen in cash over the 3 years from FY3/2025 to FY3/2027. In addition to maintaining and strengthening our competitiveness, we will utilize 30 billion yen for growth investments in existing businesses in consideration of responding to new lease accounting. In terms of new business development and M & A, we will review our assets and utilize liquidity on hand, interest-bearing debt, etc.
Please see the presentation materials below for the medium-term management plans.