Message from Our President
I would like to extend my deepest condolences to those who are grieving for their loved ones who died from pneumonia attributable to the novel coronavirus. My heart goes out to the patients affected and all others who are experiencing great distress due to the infectious spread of the coronavirus.
The pandemic has had a significant negative impact on the Japanese economy as well as other economies globally. The world is facing the most challenging crisis since World War II. Mandom, a company engaging in business activities in Asia, cannot escape from this crisis. It is difficult to foresee the future. The prospects for the economy look dim and uncertain.
In view of these circumstances, we decided to postpone for a year the start of the 13th Middle-Range Planning (hereinafter "MP-13") which was scheduled to start this fiscal year.
MP-13 covers the second phase, or the period of "changes and challenges," for the realization of VISION2027. Instead of embarking on MP-13, during this fiscal year of uncertainty, we will concentrate on minimizing the impact of the pandemic while paying the greatest attention to the health and safety of our customers, business partners and employees, all of whom are our priceless resources, so that we could set MP-13 to a better start next year.
The preceding 103rd term (FY2020/3) was the final year of the 12th Middle-Range (3-year) Planning (hereinafter "MP-12"). MP-12 was the first phase, or the "infrastructure development phase," of the three phases of "VISION2027," the vision we hold for the ideal place where we want to stand in 2027 when the company marks its 100th anniversary.
Within Japan, foreign tourists' demand for our products dipped, and summer products did not sell well due to the unusually cold summer weather. We had to struggle hard and faced a tough time financially. Meanwhile, business with Indonesia and other foreign countries remained firm, with the record high consolidated revenue of 81.7 billion yen. The operating profit margin and net profit attributable to parent decreased.
The basic management targets of MP-12, that is, the consolidated revenue of 90 billion yen and consolidated operating profit margin of at least 10%, were not achieved. The revenue was influenced substantially by a changing mobile communication environment, such as the increasing number of smartphone and SNS users in Japan and overseas, and the digitization of society at large. As a result, consumers gather and dispatch information in a way completely different from before and carry out different decision-making processes before purchase, resulting in changes in how trends form. We could not cope with this radical change that society is undergoing, and that was the biggest reason why we could not meet the targets. The profit was the result of our proactive investment into infrastructure development aimed at becoming a truly global company. We introduced a group-wide integrated communication network and improved our office environment as scheduled initially.
Regarding management policy, we will place the highest priority on maintaining financial stability while taking appropriate measures against COVID-19. We will position this fiscal year as "Pre-MP-13" to continue addressing issues which came up in MP-12 and prepare for "changes and challenges" we undertake in the next phase, MP-13.
To conclude my message, I ask you sincerely for your understanding and continued support for our corporate policy.
President Executive Officer & Director