Three Pillars of the Mid-Term Management Plan
Basic Policies
- Taking into serious consideration our first operating loss since 1995, and with profound remorse, we are determined to establish the Second Foundation of the company.
- We have designated the period covered by this Mid-Term Management Plan as a three-year period in which to solidify our footing and take a turn for the better. After resolving fundamental issues, the next Mid-Term Management Plan will be a three-year period for regrowth.
- We will transform into a comprehensive entertainment company that creates smiles for as many people as possible and spreads the circle of happiness around the world.
Differences with Previous Mid-Term Management Plan
- The direction we took with the previous Mid-Term Management Plan was not wrong, but it was too abstract and lacked concrete details, and we also failed to change our corporate culture. As a result, we did not achieve our goals.
- In this Mid-Term Management Plan, we focus on tangible goals, i.e., “what we intend to do, at what scale, and with whom (which partners),” and the execution of these goals.
- Under this Mid-Term Management Plan, we will transform our corporate culture to one that has executing capabilities.
- Implementation Period
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FY 3/2022 to FY 3/2024 (three years)
- Indicators for Targets
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- We are targeting a rebound of 3.0 billion yen in operating profit in the last year of this Mid-Term Management Plan.
- In the next Mid-Term Management Plan, we will increase profit even more with topline growth.
- In this Mid-Term Management Plan, we are aiming for an EPS growth rate of 30% or higher, and will plan for total shareholder returns after a V-shaped recovery during the next Mid-Term Management Plan.
- Not only do we expect to invest 2.0 billion yen in structural reforms, but we will invest several billion to 10 billion yen in joint investments with partners globally to develop IP.
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ESG Goals
- Environment: Review suppliers based on CO2 reduction.
- Social: Launch education services and set target for ratio of women manager roles.
- Governance: Reach an appropriate level for the ratio of outside directors comprising the board of directors, introduce incentive plans for directors, and establish a Nomination and Compensation Advisory Committee.
Progress of the Mid-Term Management Plan
The three pillars of "Reforming Corporate Culture," "Completing Structural Reforms," and "Planting Seeds for Regrowth" each made solid progress.
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Corporate Culture Reform
Institutional reforms appropriate for human capital management will be implemented in rapid succession.
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Completion of Structural Reform
Eliminated losses in domestic product sales and U.S. operations one year ahead of schedule
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Planting Seeds for Regrowth
New IP creation and education business is progressing well.
In the digital domain, three new businesses have started.
Financial Targets and Progress
| Financial results for FY 3/2022 |
Financial results for FY 3/2023 |
Financial results for FY 3/2024 |
|
|---|---|---|---|
| Operating Profit | 2,537 million yen | 13,247 million yen | 26,900 million yen |
| ROE | 8.5 % |
16.4 % |
29.2 % |
| EPS | 42.49 yen |
33.74 yen* |
73.08 yen* |
*The Company conducted a 3-for-1 common stock split effective on April 1, 2024. Basic earnings per share are calculated as if this stock split had taken place at the beginning of the previous fiscal year.
The Last Decade and the Future of Sanrio
Operations have struggled since the fiscal year ended March 31, 2015, and an operating deficit was recorded in the fiscal year ended March 31, 2021.
Taking into account initiatives necessary to eliminate the operating deficit, we formulated this Mid-Term Management Plan to solidify our footing for the future and take a turn for the better, and as a result of implementing structural reforms, a turnaround from operating deficit was achieved.
Envisioning further future growth, we have set long-term targets of operating profit of 50.0 billion yen or higher and a market value of 1 trillion yen or higher as part of our value creation story for the next decade.
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