■ Capital policy and shareholder return strategy of Kotosen Co., Ltd. <8093>
1. Implementation of capital policy contributing to shareholder value
Emerging from the impact of the coronavirus pandemic, the company's revenue and profits are steadily recovering, and the earnings foundation is becoming solid. In the medium-term management plan, the group is promoting group management conscious of capital cost and stock price. Setting five management indicators (roe, WACC, equity ratio, shareholder capital cost, pb) and target values (by the end of March 2026), the company pursues that roe 5.4% (initial target 8%) exceeds shareholder capital cost, focusing on shareholder value. Taking a management approach that prioritizes stock price.
Changing the profit distribution policy, balancing 'growth M&A investment' and 'active shareholder return strategy'
2. Shareholder return plan
The company's basic policy on profit distribution states that it will implement dividend payouts comprehensively taking into account future business development, financial conditions, and revenue trends under the appropriate capital policy in order to achieve the continuous return of results to shareholders and the sustainable improvement of corporate value. In addition, the medium-term management plan 'KBK Plus One 2025' aims to implement an active shareholder return with a dividend payout ratio of 100% for 3 years from the fiscal year ending March 2022 in order to increase capital efficiency with consciousness of stock price. The annual dividend for the fiscal year ending March 2024 was 93.5 yen. For fiscal year ending March 2025 and beyond, it aims to maintain a high level of shareholder return while focusing more on growth investment. Specifically, prioritizing profit allocation to growth investments such as M&A (two executed transactions), with the result that the annual dividend for the fiscal year ending March 2025 is 70 yen (interim dividend of 35 yen, year-end dividend of 35 yen), and the estimated annual dividend for the fiscal year ending March 2026 is also 70 yen (minimum). The company plans to continue with active shareholder returns based on sustainable growth through further growth investments.
(Written by: Fisco guest analyst Keiji Shimizu)
