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疋田直太郎社長写真

40th Annual Business Activity and Financial Results (From March 1, 2016 to February 28, 2017)

 First of all, we would like to thank you very much for your continued support of KOHNAN SHOJI CO., LTD.

 During the above mentioned term, the Japanese economy has been gradually recovering and showing its resilience, despite weak personal consumption.

 In light of these circumstances, we have established a medium term management plan called “We love KOHNAN 2017,” implemented in April 2015. To achieve our plan’s second-year objectives, we are focusing on our initiatives of “revitalization of existing stores” and “reduction of merchandise”. So far, the results of this twin-turbo strategy have exceeded our expectations.

 In order to further strengthen our selling power as well as meet customers’ demands with a wide selection of goods, we have opened six Home Center stores and six PRO stores during this fiscal year. Moreover, we have closed six mainly small format Home Center stores. As of February 28, 2017, there are now a total 319 stores (264 Home Center stores and 55 PRO stores).

 As for business results, thanks to the new stores, net sales have grown for the fourth consecutive year to 291 billion 136 million yen (up 0.7% from the previous year), which marks the largest sales figure in our history. Due to the improvement in gross profit margins, gross profit was 106 billion 582 million yen (up 2.8% from the previous year). Operating income was 16 billion 81 million yen (up 10.4% from the previous year) and ordinary income was 14 billion 562 million yen (up 12.8% from the previous year). With impairment loss of 3 billion 855 million yen which exceeded the initial forecast, net income rose to 6 billion 72 million yen (up 0.5% from the previous year).

Implementing the Medium-Term Management Plan as the last fiscal year and Strengthening Dominant Strategies in Kanto District

 Through the activities of revitalizing our existing stores, we will be vigorously pursuing our medium-term management plan, which ends in the next fiscal year. We will also reduce our inventory to reduce the loans payable and improve our financial constitution for more sound corporate governance.

 Additionally, we acquired all shares of BEAVERTOZAN CO., LTD., a subsidiary company of Odakyu Electric Railway Co., Ltd. which runs eleven Home Center stores, mainly in Kanagawa prefecture. By welcoming BEAVERTOZAN CO., LTD. into our group, we intend to further strengthen our sales force through carrying out our dominant strategies in the Kanto district, particularly in Kanagawa prefecture.

 Going forward, we will be striving to improve our enterprise value through the realization of sustainable sales growth and profit growth so that we can meet and exceed the expectations of our shareholders.

In Commemoration of the 20th Anniversary of our Stock Listing, Higher Returning Profits to Our Shareholders

 We recognize it as a priority of business management to return our profits appropriately and actively to our shareholders as well as society. We consider it our fundamental policy to keep our dividends stable while remaining mindful of the balance with the internal reserves to expand our business.

 With this policy in mind, originally, we had planned to pay 19 yen per share both as an interim and a year-end dividend (annual dividend is 38 yen per share). However, we have decided to pay 22 yen per share to our valued shareholders as an interim and a year-end dividend (annual dividend is 44 yen per share, which is a 6 yen increase from the prior annual dividend) to commemorate the 20th anniversary of our stock listing, as well as to maximize shareholders’ value. This represents a 3-yen increase from the prior interim and year-end dividends.

 In closing, we would like to thank all of our shareholders for your continued support of KOHNAN SHOJI CO., LTD.



May 25th, 2017
KOHNAN SHOJI CO., LTD.
PRESIDENT, Naotaro Hikida