Shareholder return strategy: No. 1<3562> changed its shareholder return policy along with the publication of the new mid-term management plan "Evolution 2027" and showed the direction of significantly strengthening shareholder return. So far, we have aimed for stable dividends (30% dividend payout ratio as a guide), but in the future, we plan to implement stable and continuous shareholder dividends based on a policy of aiming for a 30% dividend payout ratio, regardless of changes in annual performance. A notable feature is that we have set a minimum dividend of the previous year's annual dividend per share and will continue to increase dividends, which is a significant enhancement of shareholder return and can also be evaluated as a expression of confidence in profit growth. Moreover, we have a policy of "flexibly implementing under financial discipline" for acquiring our own shares, showing a more proactive stance.* *Considering the gap between our own perception of the stock price and the market evaluation, ROE, capital efficiency, and CF level, we have a policy of implementing it flexibly. Dividends for the fiscal year ending February 2024 will increase by 1 yen from the previous year, as expected at the beginning of the period, to 33 yen per share (mid-term dividend of 16.5 yen and year-end dividend of 16.5 yen). We also acquired 340,000 shares of our own stock (with a purchase price of 397 million yen). Despite the anticipated decline in profits for the fiscal year ending February 2025, we are expected to follow the policy of increasing dividends every period and issue a dividend of 1 yen per share (a commemorative dividend for the 35th anniversary of our founding), with an expected increase of 2 yen from the previous year to 35 yen per share (mid-term dividend of 17.5 yen and year-end dividend of 17.5 yen).

Regil <176A> positions the return of profits to shareholders as one of the most important management policies. Regarding profit distribution, the basic policy is to consider securing internal reserves necessary for future corporate growth while continuing to provide shareholders with stable dividends over the long term. In terms of priority, 1) investment for future corporate growth such as facility investment, M&A, partnerships, and human resources development, 2) aiming for a consolidated dividend payout ratio of 30% or more. The company's surplus distribution is based on a basic policy of semi-annual interim dividends and year-end dividends. The decision-making body for dividends is the Board of Directors for interim dividends and the General Shareholders' Meeting for year-end dividends. As for the use of internal reserves, it is planned to be utilized as medium to long-term business capital for business expansion purposes.

The dividend per share for the fiscal year ending June 2024 is 43.0 yen (ordinary dividend 33.0 yen, 30th anniversary commemorative dividend 10.0 yen), and for the fiscal year ending June 2025, the ordinary dividend per share is planned to be 36.0 yen.

(Author: FISCO guest analyst Nobumitsu Miyata)