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To Our Shareholders

To Our Shareholders

The following is a brief report on the performance of Seino Holdings Co., Ltd. for the fiscal year ended March 31, 2017, our 96th term (from April 1, 2016 to March 31, 2017).

In the fiscal year under review, Japan’s economy continued to recover moderately with employment and income conditions still benefiting from various government policy measures. Despite this improvement, however, the economy appears stuck at its current pace, and its prospects remain unclear amid various concerns such as fears for global economic slowdown, especially China, the issue of Brexit, and the policy directions following the US Presidential elections.

In the transportation industry, the Seino Group’s mainstay business, although the trend of decline in freight volume appears to have ended, we faced problems such as rising outsourcing costs and increasing personnel expenses.

In this environment, we pushed forward together to enhance the Company’s corporate value. We steadily implemented the various measures in our medium-term management plan “JUMP UP 70: Change for the Future,” which is now in its final year, and worked to establish a strong business foundation through initiatives to expand business fields.

In addition, in March 1, 2017, Unicla Jiko Co., Ltd. (headquarters: Nagoya City) was made a subsidiary of the Company. By expanding our business operations in the field of automobile maintenance through establishing a hold in markets outside the Kanto region, we are developing a management structure for the Vehicle Sales Business that is centered on a maintenance business and not reliant on new car sales.

As a result, operating revenue for the fiscal year ended March 31, 2017 was ¥567,539 million (up 2.2% year on year), operating profit was ¥27,116 million (up 3.6% year on year), ordinary profit was ¥28,909 million (up 2.2% year on year), and profit attributable to owners of parent was ¥18,206 million (down 3.5% year on year).

Transportation Services Business

In the Transportation Services Business, we worked on expanding revenue and securing profit by steadily implementing primary policies based on our medium-term management plan such as stabilization of the transportation network, and expansion of the logistics business.

With respect to office expansion efforts, Tokai Seino Transportation Co., Ltd. newly established the Nakatsugawa branch (Nakatsugawa City, Gifu Prefecture) to strengthen the transportation network. In addition, Nohi Seino Transportation Co., Ltd. established the Kakamigahara Logistics Center (Kakamigahara City, Gifu Prefecture) with temperature control storage to expand and enhance the logistics business.

At Seino Transportation Co., Ltd., the core company of the Transportation Services Business group, we continued proactive negotiations to receive reasonable transport fees and charges, and fuel surcharges, as a measure to improve profits, and we worked on increasing customers through improving services utilizing data sharing with customers through EDI (electronic data interchange). We also worked to properly manage operation capabilities and costs, improve load efficiency in consolidated deliveries, etc. to ensure revenue and profit.

In addition, we earned our customers’ trust in our transportation services by further improving stable, fixed-time fixed-route deliveries with the virtuous transportation cycle and by striving to train truly professional drivers by adopting a safety promotion system to fulfill social responsibility.

As a result of the above, operating revenue for this segment was \422,869 million, up 1.6% year on year, and operating profit was \20,020 million, up 4.7% year on year.

Vehicle Sales Business

In passenger vehicle sales, the number of new car sales significantly increased year on year through various efforts including sales operations conducted at the local level, and campaigns taking full advantage of the effects of new vehicle model launches.

Meanwhile in used vehicle sales, although retail sales dropped due to a shortage of quality trade-in vehicles, the number of wholesale vehicles sold for auctions rose, thereby securing the same level of used vehicle revenue as the previous fiscal year.

Also, we worked to secure service revenue by promoting vehicle inspections focused on improving customer satisfaction, and vehicle maintenance and garage services, as well as the sale of tires and oil, etc.

In truck sales, the number of new vehicles sold increased year on year, particularly those in the heavy truck classes, due partly to a robust increase in demand for cargo-use trucks. Although conditions were difficult in the used truck market due to a shortage of quality vehicles, we concentrated on capturing demand for vehicle maintenance, such as for vehicle inspections, and sales of used-parts.

In office expansion efforts, Netz Toyota Gifu Co., Ltd. carried out a full refurbishment of the Hozumi branch (Mizuho City, Gifu Prefecture).As a result of the above, operating revenue for this segment was \100,237 million, up 6.1% year on year, and operating profit was \5,055 million, up 2.6% year on year.

Merchandise Sales Business

The Merchandise Sales Business engages in the sale of fuel, paper and paper products, and other products. Operating revenue for this segment was \27,749 million, down 1.0% year on year, partly due to the impact of a fall in sales unit prices for fuel sales. Sales of domestic tissue papers were firm, and operating profit was \766 million, down 0.8% year on year.

Leasing for Real Estate Services Business

In the Leasing for Real Estate Services Business, we strive to effectively utilize business resources by leasing the former truck terminal and store sites, which had been replaced mainly due to the impact of urban development and increasingly cramped conditions.Operating revenue for this segment was \1,542 million, up 4.8% year on year, and operating profit was \1,278 million, up 4.2% year on year.

Other Business

Our Other Business segment includes the information services business, the housing sales business, the construction contract business, the passenger transportation business, and the personnel services business.Operating revenue for this segment was \15,140 million, down 1.7% year on year, and operating profit was \727 million, down 34.3% year on year.

In our outlook for the Japanese economy, we expect that the moderate tone of recovery will continue amid the ongoing improvement in the employment and income environments, with positive effects also expected from various policy measures. Nevertheless, there are lingering uncertainties reflecting concerns such as the impact of various problems in overseas countries and fluctuation in the financial and capital markets.

In the transportation industry, the primary industry of the Seino Group, although there are positive signs of consumer-related freight, we expect the business environment to continue as it has for the previous fiscal year due to increases in personnel expenses and outsourcing costs, as well as higher fuel prices. Facing such circumstances, the Seino Group has formulated a new three-year medium-term management plan “Value-Up Challenge 2020: Take Off Toward Growth,” which commenced in the fiscal year ending March 31, 2018. While seeking to stretch our “strengths” accrued up until now, we will pursue maximization of value, and accelerate our reforms and bold initiatives to create new value.

In our mainstay Transportation Services Business, our primary policies are to stabilize, maintain and expand our transportation network; expand our logistics business operations with storage and distribution processing that uses digital tracking and with a global network of third-party logistics providers; and address globalization such as providing support for overseas logistics for Japanese corporations.

At Seino Transportation Co., Ltd., our core company, aiming to maximize the full potential of our personnel, we will move ahead with working style reform geared up to alleviate the effects of future labor force decline through initiatives including streamlining operations with systems such as further promotion of EDI, introducing automatic-transmission trucks, and employing a combination of various methods of transportation through the promotion of modal shifts and introduction of full trailers.

In addition, in the Vehicle Sales Business, we are working to enhance and expand the business base to enable more sales offices to be number one dealer in their local region, while striving to enhance the vehicle maintenance network in the Kanto area.

Striving to achieve our new medium-term management plan, we will take further steps to select and concentrate our business resources and move forward with a keen focus on business expansion and growth.
As this year’s slogan “Handing down” suggests, we aim to achieve further growth by creating new value as we go about our work with our “customer viewpoint” that we have worked to hand down to next generations since our founding.To all shareholders, we sincerely ask for your ongoing encouragement and support into the future. 


June 2017 

Yoshitaka Taguchi,

President and Chief Operating Officer

Takao Taguchi,

Representative Director