■Shareholder return policy

1. Shareholder return policy

Yondenko ＜1939＞ announced “Initiatives Aimed at Improving Capital Profitability” in 2023/8, and its basic policy is “By implementing growth investments, starting with human resource investment, we aim for sustainable growth in profits, and achieve an appropriate capital structure by enhancing shareholder returns, etc.” Accordingly, initiatives focusing on improving ROE are being promoted.

Regarding shareholder returns, the shareholder return policy was changed in 2023/8 under the “Mid-Term Management Guidelines 2025,” and the standard consolidated dividend payout ratio was raised from the previous 30% or more to 40% or more. Also, even when profit temporarily declines due to economic trends, etc., efforts will be made to maintain dividend levels as much as possible. Furthermore, a policy was set out to examine the reduction of investment units through stock splits by looking at the timing from the viewpoint of improving stock liquidity and stock price sensitivity, and effective share buyback methods and scales, keeping in mind that stock liquidity is not reduced as much as possible. Then, 3 stock splits were carried out with 2024/10/31 as the effective date.

The dividend forecast for the fiscal year ending 2025/3 was revised upward as of 2024/10/31 due to this policy and growth beyond the plan in business results. When converted into 3 stock splits, dividends increased by 13.33 yen for the fiscal year ending 2024/3 to 46.67 yen (20.00 yen at the end of the interim period, 26.67 yen at the end of the fiscal year) to 60.00 yen (30.00 yen at the end of the interim period, 30.00 yen at the end of the fiscal year) for the fiscal year ending 2024/3, and the dividend ratio is 61.6%. I would like to look forward to further improvements in shareholder returns as business results expand.

2. sustainability management

The company is also working to promote sustainability management. The “Yondenko Group Sustainability Policy” was formulated in December 2021, and in January 2023, they agreed with the climate-related financial information disclosure task force (TCFD) recommendations and joined the TCFD consortium. We invested in Tokushima Prefecture Sustainability Bonds (Tokushima Prefecture SDGs Bonds) in September of the same year. In December of the same year, three companies, Shikoku Kasei Kogyo, Shikoku Electric Power, and Yonko Solar, signed the first off-site PPA business agreement as a group in order to procure electricity derived from renewable energy to realize a carbon-neutral society. The “Yodenko Group Human Rights Policy” was also formulated. We will work to respect the human rights of all stakeholders involved in business activities and contribute to the sustainable development of society.

In 2024/1, due to the Reiwa 6th Noto Peninsula Earthquake, 76 people were dispatched to support restoration work for Hokuriku Electric Power Transmission and Distribution, and donations were donated through the Japanese Red Cross Society. In March of the same year, funds were contributed in agreement with the purpose of the system aimed at supporting young people's school enrollment and promoting employment within the prefecture carried out by each prefecture in Shikoku. This is the 3rd time it has been implemented. In October of the same year, it was invested in Kochi Prefecture Reiwa 6 1st public offering public bonds (green bonds, 5 years). Also, every year, the month of October is designated as “Friendship Month,” and activities rooted in the community are being developed together with related companies, such as cleaning activities and electrical equipment inspections for important cultural properties.

(Author: FISCO Visiting Analyst Masashi Mizuta Exhibition)