May 10, 2016

SG Holdings aiming at Y1 trillion sales in FY2018

SG Holdings (SGHD, Chairman: Eiichi Kuriwada) has drawn up "First Stage 2018", a new mid-term management plan starting from FY2016 as the first year. The plan upholds as targets sales of Y1 trillion and operating profits of Y62 billion in the last year of FY2018. The company aims to make a departure from dependency on its delivery business centering on Sagawa Express, creating added value by linking it to the other business segments such as overseas and its related services and by providing solutions leveraging the group's total strength. The company emphasizes intensification of the group management for growth.

Kuriwada and Tadashi Machida, president, and the other executives held a press conference on May 6, explaining about the results of FY2015 (ending March 2016) and the new mid-term plan. Kuriwada said at the beginning that, "The core of SGHD is the delivery business that accounts for 80% of our sales. It is our urgent task to establish the second and third main business in order to free ourselves from the one-legged (delivery business-dependent) situation. Our cross-section team project GOAL, which is in the third year since the foundation, is highly evaluated, as it is supporting customers for realizing their management strategies by digging out not only visible needs but also potential issues and by proposing optimal solutions. Still, it takes some time to grow on our own. We have added Expolanka (a major Sri Lankan logistics company which took a stake in SGHD in 2014) to our group in a bid to grow in international business fields. We also intend to link the partnership with Hitachi Transport System to growth by making a partnership with a company with resources."

In the preceding mid-term plan named "Third Stage Plan", the company had set a goal of Y1.1 trillion in sales and Y53 billion in operating profits for the last fiscal year. As a result, sales of Y943.3 billion in that year could not reach the goal, as the revenue increase stemming from M&A came short of the expected level. The company posted, however, operating profits of Y54 billion which surpassed the set goal, as it made efforts to enhance productivity and dealings at appropriate freight rates took hold.

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