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).

As a shareholder return strategy, TOKAI Holdings <3167> has introduced dividend payments and shareholder benefits, and has actively worked on shareholder returns, such as purchasing own shares depending on the circumstances. Regarding dividends, the basic policy is to pursue the improvement of corporate competitiveness and the maximization of corporate value while considering the enhancement of management structure and future business development, and to conduct stable and continuous dividends with a dividend payout ratio of 40-50% as a benchmark. Based on the same policy, for the fiscal year ending March 2024, the dividend per share was increased by 1 yen from the previous year to 33 yen (dividend payout ratio of 50.8%) due to the steady performance as planned at the beginning of the period. For the fiscal year ending March 2025, a continuous increase in dividend of 1 yen to 34 yen (dividend payout ratio of 49.3%) is also planned.

In addition, shareholders who hold 100 or more shares at the end of March and September are eligible for various benefits such as QUO card gifts according to the number of shares held, and the annual investment yield per unit including shareholder benefits is estimated to be 5-8% at the current stock price level (as of May 31, 2024, and closing price of 963 yen) if the shareholder benefit is selected as QUO card or Aqua product.

(Written by FISCO guest analyst, Jo Sato)