To Our Shareholders
Our growth and progress is a never-ending process.
We wish to express our gratitude to all our shareholders for your continuing support.
We would like to express our deepest sympathies to all those affected by COVID-19 and to the medical professionals who engage in the treatment against it.
This fiscal year was the final year of the medium-term management plan "SHIP VISION 2020", and we have made every effort to achieve our targets and complete priority measures. As a result, although some of our businesses were affected by COVID-19, we were able to achieve the target values for the final year of the plan and achieve many results in each of the priority measures.
Currently, the environment surrounding the Group requires a wide range of knowledge, technology, and know-how that goes beyond the conventional framework, such as regional medical cooperation, cooperation between medical and nursing care, and promotion of DX utilizing IT.
We will continue to overcome these various issues and strive to further improve corporate value and investors value based on the SHIP philosophy (Sincere, Humanity, Innovation, PartnerSHIP) that the Group has been advocating since its founding.
We appreciate all of you for your continued support and encouragement.
Established new organizational structure for next growth
In this turbulent business environment, the Group has always pursued the "trend" and achieved sustainable growth providing various values while accurately grasping the needs of the times. Under these circumstances, we were able to mostly achieve our goals for "SHIP VISION 2020" ended fiscal year March 2021. We would like to express our deepest gratitude to our shareholders for their support, and we will accelerate our efforts to achieve our next target of consolidated sales 1 trillion yen.
As the first step in our efforts, the Group has decided to reform the existing organizational structure and start a new management system. By appointing officers in charge of each segment, we will further enhance cooperation among group companies within the same segment, and share and unify business direction and strategies across the all segments. In addition, we have established “Corporation Strategy Dept.” which pursues further growth of the Group, “Efficiency Planning Dept.” which promotes utilization of IT and business efficiency, “Human Resource Development Dep.” which nurtures human resources, which is our most valuable asset, and “Business Support Dept.” which supports the business in the background, as the reform of administration and management system of entire the Group. We will strengthen our management base with this new organization aiming to develop the Group beyond the conventional framework. Through these organizational reforms, we will strengthen group governance, and at the same time, aim to create new group synergies and maximize group strength to restart with a whole Ship Healthcare Group.
Completed the medium-term management plan "SHIP VISION 2020"
Performance in FY03/2021 and medium-term plan ＜Mostly achieved the medium-term plan in a difficult business environment＞
In this Fiscal year, the final year of the medium-term management plan "SHIP VISION 2020", economic and social activities have been severely restricted as the number of infected people remains high due to the expansion of the COVID-19, so that the business environment of medical field in which the Group operates also continue to be in a difficult situation. Under such business environment, in Total Pack Produce (TPP) business, new initiatives such as the development and sale of infection control products, temporary fever outpatients buildings, and simplified negative-pressure ventilators have been successful although the hospital construction/relocate projects were smaller than usual. In Medical Supply (MSP) business, performance remained steady due to the cooperation within the group and improvement of management efficiency. Although there was some impact by COVID-19, sales related to infection control such as the new series of "Airness" and "SHIP mask" boosted our business performance. As a result, although sales were slightly below the planned value of 500 billion yen in the medium-term management plan, operating income increased by 3.8% and net income attributable to owners of parent also increased by 1.5% from the medium-term management plan.
*The planned value is the initial forecast since it was not set in a medium-term management plan.
*The dividend amount is actual amount before the two-for-one common stock split executed on April 1st, 2021.
Progress and results of priority measures ＜Realization of a resilient group of healthcare companies against changes＞
In this medium-term management plan, while strengthening and expanding the management and business base, we have been working on expanding business fields, high growth in each segment, and strengthening shareholder returns under four priority measures. In expanding business fields, in addition to establishing a Healthcare Service business such as Osaka Heavy Ion Therapy Center, we have made a full-scale entry into the BtoC field including the new series of "Airness" and "SHIP mask" that we propose as infection control measures. In addition, taking the opportunity of entering the BtoC field, we have promoted awareness of the "SHIP brand" and expanded the areas of our business. In the high growth of each segment, we are continuing M&A and collaboration including overseas to expand the business scale and acquire new know-how, and also the automated logistic center "Osaka Solution Center" has begun its operation that enables next-generation distribution of medical materials. In strengthen shareholder returns, we carried out a large-scale acquisition of treasury stock totaling approximately 5 billion yen while maintaining a dividend increase and dividend payout ratio of 30% or more.
Under these circumstances, although there were various changes in society and industries due to COVID-19 that was not expected at the time of formulating this medium-term management plan, we have achieved the medium-term management plan by uniting the entire company and all officers and employees even in COVID-19 crisis as “a resilient group of healthcare companies against changes".
①Further growth of core business
■Accelerate further growth of core business centered on existing four business
■Strengthening management capability through reinforcement of IT infrastructure, integration of business bases, and improvement activities
・Promote establishing IT infrastructure. Work-style reform progressed at once in COVID-19 crisis.
・”Osaka Solution Center”, which brings innovation to medical material distribution, was completed. (MSP)
・Maintain high occupancy rate of almost 100% by promoting of nationwide integrated management (LC).
・Improvement activity is well-established by continuing “Kaizen (improvement) Olympic”.
②Establishment of fifth business segment, Healthcare Service business
■Establishment of domestic and overseas Healthcare Service business
■Expansion of business opportunities starting from existing business bases
・Total treatment result approximately 1,200 people in Osaka Heavy Ion Therapy Center which has begun the treatment since October 2018.
・Hospital which we have been establishing in Bangladesh is scheduled to open in the summer of 2021.
・Business in international justice center proceeded mostly as planned.
③Active M&A activities
■Further supplement and expand core business by active and strategic M&A
・Two largest medical device/equipment trading companies in Myanmar joined the Group in April 2020. (TPP)
・Concluded business alliance agreement with CHARM CARE CORPORATION in May 2020 and it became an equity-method affiliated company.
・Undertook third-party share issuance of ONETABLE, inc. in November 2020. Planning KKB business.
④Strengthening shareholder returns
■Consolidated payout ratio of 30% or more
■Flexible acquisition of treasury stock
・Acquisition of treasury stock totaling approximately 5 billion yen during the period.
* In addition, along with the issuance of convertible bond (CB), 10 billion yen of treasury stock was acquired.
・Maintain dividend payout ratio 30% or more during the period.