On behalf of the NSG Group, I would like to express my sincere gratitude for your continued support.
In FY2023, while facing strong headwinds in our business environment such as higher energy, materials and other costs and constrained vehicle production, the Group implemented major initiatives set forth in Medium Term Management Plan “Revival Plan 24 (RP24)” and made group-wide efforts to mitigate such impacts.
Consequently, the Group delivered for FY2023 on a full-year basis, a revenue of 763.5 billion yen, an increase of 27% year-on-year (FY2022: 600.6 billion yen) and an operating profit of 34.8 billion yen, an increase of 74% year-on-year (FY2022: 20 billion yen). However, the Group recorded a loss before taxation, a loss for the period and a loss attributable to owners of the parent due to a full impairment of all remaining goodwill and intangible assets of 48.8 billion yen related to the Group’s automotive business in Europe recognized in the second quarter.
Initiatives for the Fiscal Year Ending March 2024 and Promotion of Medium Term Management Plan “Revival Plan 24 (RP24)”
The fiscal year ending March 2024 (FY2024) is the final year of RP24. While energy costs have slightly come down, uncertain business environment is predicted with continuous material and other costs increase such as freight and labour caused by worldwide inflation trend, and potential recession caused by rising interest rates. The Group has been under a new management structure since April, but there is no change in our focus on the Three Reforms of RP24, i.e., “Cost structure reform”, “Business structure reform”, and “Corporate culture reform”.
In “Cost structure reform”, we will continue to drive forward fundamental cost reduction initiatives such as streamlining the workforce and lowering fixed costs. Digital Transformation is an integral part of this drive and will be pursued across the entire Group.
In “Business structure reform”, the Group is shifting its focus to VA glass in the Architectural Glass business by expanding the sale of solar glass for solar panels and developing BIPV (Building Integrated Photovoltaic Module) for buildings and housings. In the Technical Glass business, efforts are made to promote the application of SELFOC® Lens Array for use in contact image sensors to industrial inspection machine. Also, the Group has received many inquiries for MAGNAVI®, a high-modulus and high-strength glass fiber which was released as a new type of solution for the growing composite market driven by the decarbonization of society, from customers looking for structural component materials for transport equipment.
In “Corporate culture reform”, we will put emphasis on the four (3+1) “F” i.e., Flat organization, Frank communication, Fast decision making + Fun at the workplace along with talent diversity to accelerate and realize “Cost structure reform” and “Business structure reform”.
In light of these Three Reforms of RP24, we will develop our future strategy with the four key words having “D” i.e., Decarbonization, Digital, Development (new business/ product development), and Diversity. Decarbonization and Digital are crucial not only for our business growth but also for our operations such as cost reduction. We aim to Develop new technologies, new products, and new business models to capture the market trends of Decarbonization and Digital and link them to business. In addition, we will further promote Diversity which is a strong source of new ideas that are crucial to the development of our business.
By implementing these reforms and strategies, the Group strives to restore its earning power and transform its business structure at the earliest opportunity in order to build business strength to generate stable net profit and free cashflow and sustain the cycle of growth.
The Group’s basic policy regarding the distribution of profit to shareholders is to declare stable dividends on common shares based on sustainable business results.
Regretfully, the Group decided not to declare dividends on common shares for the fiscal year to 31st March 2023, taking into consideration its business results and financial situations comprehensively. I am deeply sorry and sincerely apologize to our shareholders. The Group recognizes the importance of dividends to its shareholders and will concentrate its efforts to improve profitability with a view to the resumption of dividend payment as early as possible.
I would like to ask your continued understanding and support.
Representative Executive Officer
President and CEO
Nippon Sheet Glass Co., Ltd.