Accelerated Pursuit of New Growth
Earnings Growth Scenario
In fiscal 2017, the year ended February 28, 2018, we brought forward the closures of underperforming stores and the recognition of impairment losses to address future concerns. Consequently, we expect to have significantly lower impairment loss risk from fiscal 2018 onward. Taking into account contributions to earnings from new revenue-generating businesses, the Group is targeting ¥60.0 billion for profit for the year attributable to owners of the parent in fiscal 2020, the medium-term management plan's final year.
Fiscal 2018 Priority Measures
In fiscal 2018, the year ending February 28, 2019, with Accelerated Pursuit of New Growth as our goal, we will concentrate on establishing foundations for medium-tolong-term growth while beginning preparations for the creation of new revenue-generating businesses. Therefore, the majority of investment in fiscal 2018 will focus on the CVS business. Given that the investment needed for management integration will have ended, starting from fiscal 2019 we plan to pursue a basic policy of keeping investment within the scope of operating cash flows.
Total investment for FY2018 ¥140.0 billion
|Breakdown of investment by measure||Reinforcement of store foundations||¥105.0 billion|
|Enhancement of product competitiveness||¥12.0 billion|
|Improvement of store operating procedures||¥20.0 billion|
|Development of earnings foundations in financial and peripheral e-commerce operations||¥3.0 billion + α|
|Breakdown of investment by segment||CVS business, HD, new||¥127.0 billion|
|GMS business||¥13.0 billion|
|Reinforcement of store foundations||
|Enhancement of product
|Improvement of store operating procedures||
|Development of earnings foundations in financial and peripheral e-commerce operations||
Interest-Bearing Liabilities and the D/E Ratio
As we will continue actively investing from fiscal 2019 onward, we expect interest-bearing liabilities to remain around ¥500.0 billion. However, we aim to improve the D/E ratio to approximately 0.7 times by accumulating shareholders' equity through earnings growth.
Targeting a consolidated payout ratio of 40%, we will distribute profits to shareholders on a stable and continuous basis commensurate with our consolidated operating performance.