President Katsutaro Inabata

To Our Shareholders
and Investors

I would like to take this opportunity to thank our shareholders and investors for their continued support.

Inabata Group has been working on a three-year medium-term management plan, New Challenge 2023 (NC2023), starting in April 2021, as the second stage toward the realization of its long-term vision IK Vision 2030, envisioning what kind of company we want to be in years around 2030. The fiscal year ended March 2023 marked the second year of the medium-term plan.
Thanks to beneficial factors such as rising sales prices, including resin prices, and the yen’s depreciation, our sales and operating profit exceeded the second-year targets of NC2023. However, due to unforeseen challenges such as the steep decline in demand for flat-panel displays and the spike in overseas procurement interest rates, we fell slightly short on ordinary profit and all subsequent profitability indicators.
On the financial side, we have maintained our net D/E ratio at a healthy 0.16 while continuing to buy back our shares to improve capital efficiency. As a result, we have kept our ROE above the 10% target set in NC2023.

For the final fiscal year of NC2023, ending March 2024, we expect net sales of ¥800 billion, operating profit of ¥21 billion, ordinary profit of ¥20 billion, and profit attributable to owners of parent of ¥21 billion. These projections take into account the current economic environment, the status of our business, the expectation of a weaker yen than initially anticipated in NC2023, and the impact of rising procurement interest rates, particularly overseas.

One of the main strategic goals of NC2023, "intensification of investment targeting future growth," involves actively expanding our business through accelerating growth investments. During the fiscal year ended March 2023, we made investments in renewable energy sectors including batteries, as well as in the upstream and downstream areas of the food and agriculture sectors. Moving forward, we aim to ensure these projects consistently generate returns. Simultaneously, as part of our new investment strategy, we will consciously emphasize synergies with our existing operations, while also pursuing high value-added businesses that can leverage the strength of our trading business group.

In the fiscal year ended March 2023, we have accelerated our sustainability initiatives. In March 2022, in accordance with the United Nations' Guiding Principles on Business and Human Rights, we established the Inabata Group Human Rights Policy through a resolution of the Board of Directors. We have also been conducting human rights risk assessments to identify, analyze, and evaluate negative impacts on human rights. In April 2022, we signed and registered as a participating company in the United Nations Global Compact (UNGC).
As part of our efforts to combat climate change, in June 2022, we announced the 2050 Carbon Neutrality Declaration, aiming to achieve effectively zero* greenhouse gas (GHG) emissions from our business operations by the fiscal year of 2050.

* Targets the amount of internal emissions (GHG Protocol Scope 1 = internal use of fuel, and Scope 2 = use of electricity and heat purchased by the company)

With increasing attention being paid to human capital management, I firmly believe that our employees, who are at the forefront of creating new value, represent our Group’s most valuable asset. Leveraging the diverse backgrounds and strengths of our workforce to unlock their full potential not only fortifies our competitive edge, but also drives sustainable growth. In order to achieve this, we are pressing forward with initiatives that include transforming workstyles, promoting diversity and inclusion, bolstering employee engagement, and fostering talent and skills development.

While the global economy is gradually recovering from the impact of the COVID-19 pandemic, we are still faced with challenges such as sudden inflation, the resulting tightening of monetary policies, and geopolitical risks including the situation in Ukraine. These factors continue to create uncertainty for our Group, which operates businesses on a global scale. Nonetheless, our fundamental business model, grounded in our trading company functions, remains unchanged. We will continue to adapt appropriately and swiftly to changes in the economic environment and society as we focus on implementing key initiatives for NC2023 across our entire Group.

I humbly ask our shareholders and investors for their continued support as we move forward.

July 2023
Katsutaro Inabata
Director, President


Final Year of Medium-Term Management Plan NC2023

(Billions of yen)

Forecast Targets
Net sales 735.6 800.0 800.0
Operating profit 20.3 21.0 20.5
Ordinary profit 19.1 20.0 21.5
Profit attributable to owners of parent 19.4 21.0 22.5
ROE 11.0% 10% or above 10% or above
Net debt/equity ratio 0.16x 0.5x or less 0.5x or less
Equity ratio 47.2% Approximately 40-50% Approximately 40-50%
Exchange rate (USD/JPY) ¥135.5 ¥130.0 ¥120.0

【Key Initiatives】

  1. Further development of core businesses and horizontal expansion into growth sectors
  2. Multi-faceted approach to markets with potential for future growth and steady monetization efforts
  3. Intensification of investment targeting future growth
  4. Further upgrades to global management information infrastructure
  5. Continuous review of assets and further improvement of capital and asset efficiency
  6. Enhancement of human capital utilization efforts

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