Financial and Business Results
Overview of the Fiscal Year Ended February 2025
In the consolidated fiscal year under view (from March 1, 2024 to February 28, 2025), the Japanese economy recovered modestly as the employment and income environments improved and the number of foreign visitors to Japan increased. Meanwhile, the outlook remains uncertain due to continued price increases and the impact of exchange rate fluctuations.
In the drugstore and prescription dispensing industries, the performance of group companies remained strong as sales of health and beauty care products as well as daily necessities and food increased in the merchandising field due to rising consumer spending and demand from inbound tourists, and as the number of prescriptions to be filled increased in the prescription dispensing field due to the aging population. This was despite a challenging environment as consumers became more frugal due to high prices, drug prices and dispensing fees were revised, and competition intensified across industries and within the same industry.
Amid this environment, we strove to strengthen our revenue base by expanding or renovating dispensing rooms and waiting rooms, strengthening our ability to fill prescriptions that require a high level of expertise, and working to expand the business of I&H Co., Ltd., a leading dispensing pharmacy that became a subsidiary of the SUGI Holdings Group in September 2024. We also made efforts to expand the use of family pharmacists and pharmacies by improving the professional training of pharmacists and expanding the offering of on-site dispensing services. Furthermore, we worked to improve productivity by assigning medical assistants to optimize staffing at individual stores. In the merchandising field, we worked to open stores to gain a dominant position in the Kanto, Chubu, and Kansai regions, and to achieve early success in the performance of new stores by attracting members to the Sugi Pharmacy app and strengthening sales promotion. At existing stores, we sought to increase sales by improving services for visitors to Japan by expanding the range of products for foreign visitors and increasing the number of foreign-language support staff, expanding the food sales area through store renovations, and optimizing sales through the Sugi Pharmacy app. In terms of sustainability management, we increased the number of stores with solar panels through the third-party ownership model in an effort to realize a carbon-free society. We also increased disclosure on human capital management and climate change measures. To fulfill our responsibilities in our supply chains, we conducted supplier due diligence to assess and analyze their efforts. Regarding the number of stores, we acquired 376 stores by making I&H Co., Ltd. a subsidiary, opened 130 new stores, and closed 38 stores. We also renovated 275 stores in an effort to make existing stores more competitive. Consequently, the number of our stores at the end of the consolidated fiscal year under review was 2,186.
As a result of the above, our earnings were as follows:
Net sales of 878,021 million yen (up 17.9%, or 133,544 million yen, year on year);
Gross profit of 275,043 million yen (up 20.2%, or 46,205 million yen, year on year);
SG&A expenses of 232,479 million yen (up 20.9%, or 40,264 million yen, year on year);
Operating income of 42,563 million yen (up 16.2%, or 5,941 million yen, year on year);
Ordinary income of 41,993 million yen (up 10.4%, or 3,954 million yen, year on year); and
Profit attributable to owners of parent of 25,689 million yen (up 16.9%, or 3,709 million yen, year on year).
Segment figures have been omitted since the SUGI Holdings Group comprises a single business.
Outlook for the Fiscal Year Ending February 2026
Going forward, the Japanese economy is expected to see an increase in consumer spending due to improvements in wages and employment conditions, as well as an expansion of the inbound market due to an increase in the number of foreign visitors to Japan. On the other hand, the outlook remains uncertain due to changes in the global economy, inflationary pressures in Japan, and worsening labor shortages. The outlook of the drugstore and prescription dispensing industries is expected to remain unpredictable not only because of M&As involving different sectors, moves toward alliances, and intensifying competition resulting from companies’ aggressive store openings, but also because of the impact of the revision of drug prices and dispensing fees. In this environment, in the field of prescription dispensing, we will work to realize synergies from the merger between Sugi Pharmacy Co., Ltd. and I&H Co., Ltd. as soon as possible and strengthen our capabilities to fill prescriptions, which require a high level of expertise. We will also strive to improve productivity by enhancing the training of specialized personnel and optimizing personnel allocation. In the merchandising field, we will step up efforts to further capture demand from inbound tourists by expanding our product offerings for foreign visitors to Japan and opening stores in city centers. Furthermore, we will work to reduce costs by promoting collaboration between manufacturing, distribution, and sales through the SUGI Pharmacy app, and improve productivity through DX of store operations.
We expect that these initiatives will lead us to achieve consolidated results for the next consolidated fiscal year as follows: net sales of 1,000.0 billion yen (up 13.9% year on year); EBITDA of 67.9 billion yen (up 12.4% year on year); operating income of 48.0 billion yen (up 12.8% year on year); ordinary income of 49.5 billion yen (up 17.9% year on year), and profit attributable to owners of parent of 34.0 billion yen (up 32.4% year on year).
Notes
The business forecast above is based on the information available as of the day when this material was released. It is possible that the actual business results will be different from the forecast figures due to various factors arising in the future.
Shareholder Benefits/Dividends
Shareholder Benefit Program
Securities code: 7649
The Company implements a shareholder special benefit plan for shareholders who own 100 shares (one unit) or more and are listed or recorded in our shareholder registry as of the last day of February every year, with the aim of responding to their constant support and deepening their understanding of our products.
| No. of Shares Held | Details of Special Benefits |
| 100 or more but less than 300 shares | Complimentary coupons worth 1,000 yen or 2,000 Sugi Points (worth 1,000 yen) |
| 300 or more but less than 3,000 shares | Complimentary coupons worth 3,000 yen or 6,000 Sugi Points (worth 3,000 yen) |
| 3,000 shares or more | Complimentary coupons worth 5,000 yen or 10,000 Sugi points (worth 5,000 yen) |
* The "Shareholder's Complimentary Passport," which adds 150 Sugi Points for every 3,000 yen of shopping, will remain as before.
Dividends
| Dividends | Unit | 2016 | 2017 | 2018 | 2019 |
|---|---|---|---|---|---|
| Dividend per share | yen | 45.0 | 50.0 | 60.0 | 70.0 |
| Payout ratio | % | 19.5 | 21.1 | 23.1 | 24.3 |
| Dividends | Unit | 2020 | 2021 | 2022 | 2023 |
|---|---|---|---|---|---|
| Dividend per share | yen | 80.0 | 80.0 | 80.0 | 80.0 |
| Payout ratio | % | 23.8 | 23.4 | 25.5 | 25.7 |
| Dividends | Unit | 2024 | 2025 | 2026 | 2027 |
|---|---|---|---|---|---|
| Dividend per share | yen | 80.0 | 35.0 | ||
| Payout ratio | % | 22.0 | 24.7 |
