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Living Up to Our Corporate Slogan of “Anything about cars, you find at AUTOBACS”
In addition to our traditional line of automotive goods, AUTOBACS stores now offer various automotive services including statutory safety inspections and maintenance, bodywork, and buying and selling cars. Our aim is to ensure that local customers remember AUTOBACS whenever they need help with their cars, and seek our support. To this end, we will keep working with our franchisees to develop stores that customers support and trust, in keeping with our corporate slogan of “Anything about cars, you find at AUTOBACS.”
AUTOBACS 2010 Medium-Term Business Plan Initiatives Successful, with Both Revenues and earnings Increasing
Many factors boosted demand in the fiscal year ended March 31, 2011. They included higher new car sales in response to the Japanese government's tax breaks and subsidies for eco-friendly cars, an extremely hot summer, and heavy snowfalls around Japan in the winter. Among the downsides were a significant fall-off in sales of electronic toll collection (ETC) devices from record high levels we saw in the previous year and restrained consumer sentiment following the Great East Japan Earthquake, inhibiting a recovery in consumption.
We steadily implemented measures under the medium-term business plan against this backdrop. Key business strategies under the plan are to enhance store profitability and improve market share. In our core domestic business of automotive goods and services sales, the top priority is to offset declining ETC device sales by lifting sales of tires and wheels while reinforcing our merchandise lineup and store sales operation and promotion. In response to increased new car demand stoked by government eco-car subsidies and a rise in demand for fitting snow tires following snowy weather, we implemented aggressive merchandise procurement and marketing activities and increased sales of tires and wheels. As a result, domestic AUTOBACS chain store sales rose by 0.2% year on year on a same-store basis, and were unchanged on a total-store basis.
Consolidated net sales increased by 1.5% year on year to ¥236.4 billion. Consolidated operating income was up by 17.9% to ¥12.0 billion, reflecting measures to improve the gross margin and strictly control selling, general and administrative expenses. Net income was up by 5.4% at ¥6.2 billion.
In line with a 3% dividend-on-equity target under the medium-term business plan, we increased annual cash dividends by ¥10, to ¥135 per share. In addition, we repurchased 1.6 million shares during the fiscal year. We cancelled 3.2 million shares of treasury stock shares in May 2011.
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Four Key Initiatives to Expand Revenues and Earnings
This year's report of higher revenue and earnings is largely a result of the initiatives in the medium-term business plan. For the fiscal year ending March 31, 2012, the second year of the medium-term business plan, we aim to further expand earnings by undertaking the following initiatives, overcoming an uncertain business environment amid price hikes in crude oil and raw materials and declining consumer sentiment following the Great East Japan Earthquake.
1) Promote more store reforms
2) Continue to improve operations for customer service and treatment
3) Expand sales through tire sales and statutory safety inspections
4) Open stores with small commercial zone format
The AUTOBACS Group strives to win the support and trust of customers by living up to our corporate slogan of “Anything about cars, you find at AUTOBACS.”
Thank you for your continued support and encouragement for our efforts.
(Please visit our website for details on progress under the AUTOBACS 2010 Medium-Term Business Plan and an explanation of financial results.)
