Shareholder return The dividend policy of NEC Capital Solution <8793> is based on maintaining stable dividends, while securing internal reserves necessary for investment in growth strategies and strengthening financial health, and reviewing appropriate dividend levels taking into account market trends and performance fluctuations. For the dividend of the 2024 fiscal year, a dividend of 130 yen per share (including an interim dividend of 65 yen) with a 20 yen increase compared to the previous fiscal year will be implemented. Regarding the dividend for the fiscal year ending March 2025, the company plans to pay a dividend of 150 yen per share (including an interim dividend of 75 yen) with a 20 yen increase compared to the dividend in the fiscal year ending March 2024, taking into account the profit forecast. The company plans to reward shareholders in accordance with the dividend policy, as it plans to achieve the highest profit on the profit side as a profit forecast. As a result, the company's dividend payout ratio reaches 40.4%. The actual PBR (price-to-book ratio) is in the 0.7x range and is below the PBR 1.0x that the Tokyo Stock Exchange is requesting improvement. Therefore, we believe that the company will actively pursue initiatives to strengthen shareholder return policies along with profit growth in the future, and the trend of increased dividends will continue.
Elemech Co., Ltd. (2715) has generally followed a dividend-based shareholder return policy, with the goal of a dividend payout ratio of 40% or more. However, starting from the fiscal year ending March 2024, the company changed its dividend policy to be based on whichever is higher of a dividend payout ratio (consolidated) of 50% or a figure calculated based on the 3% DOE criteria. The reasons cited for the change in dividend policy by the company include: 1) Increase in cash reserves due to business expansion, 2) Increase in stable revenue sources, particularly in the automotive sector, and 3) Addition of DOE criteria in order to allow dividend payments even in case of sharp decline in profits.
Based on this policy, the fiscal year ending March 2024 was expected to see a decrease in dividend payouts due to a decline in performance, but in reality a dividend payout of ¥85 per year (¥40 for interim period and ¥45 for end of term, dividend payout ratio of 64.8%) was implemented in order to "reward shareholders even slightly". Additionally, for the ongoing fiscal year ending March 2025, it is planned to follow the dividend policy and decrease the payout, but also to increase the dividend amount to ¥90 per year (anticipated dividend payout ratio of 61.4%, DOE of 5.2%).
It can be said that the company's attitude of actively pursuing shareholder return while being aware of capital efficiency is worthy of admiration.
(Written by FISCO guest analyst Noboru Terashima)