Through a transition to a lean corporate structure and on to the second stage-expanding profitsYOSHINOYA HOLDINGS CO., LTD.
The COVID-19 pandemic remains a situation in which the right answers are often not clear. This is true even for our Group, which has overcome many hardships in the past, including the Great East Japan Earthquake, and prior to that the BSE outbreak and filing for corporate reorganization. Lessons learned from such experiences cannot be applied to the current situation, which is characterized by so many unknowns.
In fiscal 2020, we were required to take fast, decisive action in our contingency response, particularly in the first fiscal quarter, when we rapidly implemented measures to prevent onsite transmission and to curb cash outflows throughout the business. Adopting the assumption that COVID-19 would have a prolonged impact, we shared a sense of crisis across the entire Group. We shifted to a phase of cost control aimed at ensuring the survival of the business.
We implemented a series of measures to ensure profitability, an initiative we named “structural change,” which involved rigorous cost control at each operating company and the closure of unprofitable restaurants. Through these measures we succeeded in lowering the break-even point.
At the same time, each operating company made efforts to protect the top line as much as possible, even while lowering the break-even point in response to forecasts for lower restaurant footfall amid restrictions on operating hours and the seating capacity.
Despite recording a significant loss in our consolidated financial results for fiscal year 2020, we were able to contain the operating loss and ordinary loss at levels that were lower than expected due to the success of the initiatives I mentioned. With the lean corporate structure we have developed over the past year, the Group expects maintain improved cost efficiency that will enable us to achieve greater profitability than before. Moreover, if the market starts to recover, we expect to be able to achieve profit growth.
In fiscal 2021 we will restart our long-term vision “NB2025” with the three-year second stage following a two-year interval from the first stage. While the outlook remains difficult to read due to the ongoing pandemic, we will target the ongoing changes in society as an opportunity to capture new customer segments and needs, channeling this toward future growth.
We believe that people development is a key condition for the Group to achieve sustainable growth. Our work is a form of “emotional labor,” in which value is created and joy is shared through the actions of people. Even as technology continues to evolve in the future, nothing can replace that aspect of what we do. We will develop the potential of each individual employee as a person and increase the value we create through our emotional labor. In this way we will work to achieve sustainable growth together.
The pandemic has been a crisis that has severely impacted the business performance of the Group. However, one outcome has been that the year became an opportunity for each operating company to transform itself into a lean corporate structure with unprecedented speed. We are confident that by maintaining this corporate structure we will be able to expand our profits as the market recovers. This will in turn position us to able to use those earnings to take our business to the next level in the run-up to the 2030s. To this end, we will aim to achieve solid results over the next three to five years. I would like to respectfully ask all of our stakeholders to keep a long-term perspective as you observe our Group.
April 2021 YOSHINOYA HOLDINGS CO., LTD.
President Yasutaka Kawamura