Pan Pacific International Holdings Corporation

Pan Pacific International Holdings Corporation

Naoki Yoshida Top Message
(September 2021)

First, I would to express my deepest gratitude for the constant and generous support of all our stakeholders.

Since the onset of the COVID-19 pandemic in 2020, we have had to deal with many challenges. Here, please allow me to take a moment to express my heartfelt gratitude and respect to everyone who is giving their all to tackle these challenging circumstances. I wish to also express my sincere sympathies to all those who have contracted COVID-19 and their families.

Now, turning to the consolidated financial results for the fiscal year ended June 30, 2021, we saw net sales of 1,708.6 billion yen (an increase of 1.6% year on year), operating income of 81.3 billion yen (up 7.8% year on year), and profit attributable to owners of the parent of 53.9 billion yen (up 7.9% year on year). This marks an increase in sales and profits for the 32nd consecutive year since the establishment of the first Don Quijote store. Once again, I wish to express my heartfelt thanks to all our stakeholders for their continued support.

Looking back over the previous fiscal year, which was our 41st and was clouded by the COVID-19 pandemic, our domestic discount store (DS) business, Don Quijote, struggled with the complete evaporation of inbound demand, coupled with a decline in foot traffic to stores in urban locations. On the other hand, our business portfolio management made up for the losses of our domestic DS business and really paid off, thanks to the good performance of the UNY of our general merchandise store (GMS) business and UD Retail (a fusion of UNY and Don Quijote), as well as and our overseas business.

Turning to the present fiscal year, our 42nd, in our domestic business, firstly, the clear change in consumer behavior, among other factors, has placed even greater expectations on our retail stores and new and different expectations on the PPIH Group. Based on that premise, in our DS business, we will continue to uncover and cater to latent demand in each commercial zone, focusing on the Million Star branch presidents,* which is in its second year. At the same time, we will aim to differentiate our products, including by strengthening the development and launch of PB products. Through these initiatives, we will promote the creation of stores that can earn the support of our customers even in this new era.

*A program in which our sales management structure is divided into commercial zones of one million people, each of which has its own branch president and transcends the Don Quijote, Nagasakiya, and UD Retail corporate boundaries.

As for our GMS business, we are accelerating the renovation of stores into New GMS and, in terms of the conversion to UD Retail, we are focused on promoting tenant-in type renovations, with Don Quijote stores becoming tenants in Apita stores.

Meanwhile, in the age of COVID-19, the rapid shift of consumers online has made the digital transformation (DX) of the PPIH Group a pressing need. In this regard, we are implementing digital data strategies that aim to create connections among our customers, our products, and our Group via our majica app, specifically by providing a seamless channel and strengthening the functions of said app.

Next, turning to our overseas business, in Asia, our Japan Brand Specialty Store has enjoyed outstanding popularity and brand recognition, enabling us to open around 12 new stores this fiscal year. In North America, we are working diligently to renovate existing stores and to enhance the quality of our delicatessen-related businesses.

Going forward, I believe the key to the growth, expansion, and development of our overseas business will be our partnership with Japanese agricultural and fisheries producers and related parties. That is why we intend to strongly support efforts to increase the amount of direct trade by expanding the range of products handled, while making full use of the Pan Pacific International Club (PPIC), a membership organization between such producers and ourselves.

Lastly, let me touch upon our environmental, social, and governance (ESG) initiatives. We will make thorough efforts to enhance such initiatives, primarily through four committees: the Diversity Management Committee and Nomination/Compensation Committee, which were established in FY2021, the Compliance Committee, and the Sustainability Committee, which was established this fiscal year to reinforce our environmental and supply chain management activities.

In closing, I would like to humbly request your continued kind support and encouragement.

September 2021
Naoki Yoshida, President and CEO, Representative Director