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).

Chonan Shingaku Kenkyusha <4720> has positioned shareholder returns as an important management issue and has recorded net losses attributable to the parent company for four consecutive periods until the fiscal year ending March 2024. Despite this, they have implemented a stable dividend of 5.0 yen per share. However, considering the financial situation, they have determined the need to prioritize the accumulation of retained earnings and have announced that no dividends are planned for the fiscal year ending March 2025. However, they intend to resume dividends early, and we believe there is a possibility of resuming dividends in the fiscal year ending March 2026 if the net income attributable to the parent company continues to recover smoothly.

On the other hand, shareholder benefits are being continued but with some changes to the content. In the past, shareholders who held 100 or more shares as of the end of March and September each year were given QUO cards worth 500 yen. However, starting from April 2024, shareholders who hold 100 or more shares as of the end of March each year and have held them for at least one year will be given QUO cards worth 1,000 yen. The reason for the change is to promote medium to long-term shareholding and streamline operations (such as reducing the cost of sending QUO cards).

(Written by FISCO guest analyst, Jo Sato)