Recognition of Current Status

For 13 consecutive fiscal years through FY2018, the number of subscribers grew and the Company achieved steady profit growth and return on equity (ROE) of 8% or higher. Its price-to-book ratio (PBR) remained above 1x through FY2020. However, in recent years, due to rapid changes in the external environment such as intensifying competition with video streaming services and changes in customers' viewing trends, the number of subscribers has declined for 5 consecutive fiscal years through FY2023, and the Company's performance has been sluggish.
Lately the Company has not been able to achieve ROE that exceeds the cost of equity (CAPM)* (recognized to be around 6%), and has not surpassed a PBR of 1x due to factors such as the buildup of equity capital from recording profits.

*The Company uses the cost of equity (CAPM method = Capital Asset Pricing Model).

Improvement Plan

The Group aims to restore its business foundation based on media services (broadcasting and transmission services) by reforming marketing, including shifting to communication based on member IDs, and by expanding content and pursuing originality. In an increasingly competitive environment, the Group will enact structural reform of media services (broadcasting and transmission services) and generate new revenue by developing new services in order to quickly shift its earnings structure toward medium- and long-term growth. At the same time, the Group will invest in growth areas, aiming to increase ROE and improve PBR.

Specific Initiatives

(1)Growth Strategy

・Enact structural reform of media services (broadcasting and transmission services)
・Generate new revenue by developing new services
・Increase productivity by promoting digital transformation and reviewing cost structure

(2)Financial Strategy

・Promote investment, potentially utilizing interest-bearing debt
・Reduce cross-shareholdings
・Continue to pay stable dividends

(3)Non-Financial Strategy

・Increase human capital investment to support sustainable growth
・Enhance sustainability management conscious of the SDGs and DEI*

*Diversity, Equity and Inclusion

(4)Improvement of IR

・Expand opportunities for dialogue with shareholders and investors through investor briefings, IR meetings, etc.
・Enhance English-language disclosure

Status of Major IR Activities

(1)Dialogues with Shareholders

Activity FY2021 FY2022 FY2023
Results briefings for institutional investors, analysts and reporters 4 4 4
IR meetings 15 7 20

(2)Main Correspondents (FY2023)

Activity Correspondents
Results briefings for institutional investors, analysts and reporters Representative Director, President & CEO; Board Director, Vice President & Executive Officer; Board Director, Senior Managing Executive Officer; Senior Managing Executive Officer; Board Director, Managing Executive Officer; Executive Officer
IR meetings General Manager of Corporate Management Division, Director of Corporate Communications & Investor Relations Department, Deputy Director

(3)Opportunities for Feedback

Details Frequency Status
IR Activity Reports 4/year Comments from dialogues with shareholders after results announcements are collected and reported at business plan progress report meetings

(4)Main Dialogue Themes and Shareholder Interests (FY2023)

・Subscription status and performance outlook
・Plans to show capital allocation
・Cross-shareholdings and shareholder returns
・PBR below 1x
・Medium-term management plan (FY2021-2025)