The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Kazunori Maki - SMBC Nikko Securities Inc., Research Division - Analyst
: [Interpreted] Thank you very much for this opportunity. I am Maki of SMBC Nikko Securities. And I would like to ask you a question. Well, I would
like to ask about how you plan to use your cash in the future. Currently, third quarter looks to be relatively strong and fourth quarter too, and we
can expect an upturn from the progress underway. If restructuring is included, you told us that you are ahead of the midterm business plan, and
targeted numbers are expected to be reached. So I would like to find out about the way in which JPY 700 billion allocated for strategic resources
will be used. So there is an acquisition of Azuga. As for the future, to what extent are the other future investment already decided, and also if you
did not use all of the fund, I think you had [policy] of returning profit to the shareholders, including share buybacks. But now that you are moving
ahead of the midterm business plan, Mr. Yoshimatsu-san, the newly appointed global CFO, would you be able to let us know how you plan to
utilize this cash?
Masuo Yoshimatsu
[Interpreted] Thank you very much for your question. As is clear from the previous questions, first of all, there is a current Q4 results, then the
business plan for the next fiscal year, as explained by CEO. And furthermore, the achievement of the midterm business plan drawn up in 2021. We
are, at the same time, reviewing our capital allocation. Our returns to the shareholders and share buybacks, as you mentioned in your question,
are also a part of the options that we are looking at. In this context, we are studying the situations from various perspectives. Because our business
performance has been showing signs of strength, and in view of that, while taking into consideration some potential factors to undermine our
revenue, we hope to report on this new direction in February next year.
But as of today, we will have to repeat our previous explanation that the JPY 700 billion strategic investment and share buybacks are both one of
the options that could be considered.
If I may add, I would also like to add that, as I explained, half of JPY 700 billion, JPY 350 billion is for investment on strategic expenses. And the
remaining JPY 350 billion would include M&A. As for the first, strategic expenses and strategic investments, we have many, many items or projects
that we can consider. Last year, I talked about implementing the plan in advance, and I promise that we will first utilize -- use up our current
production capacity. We have been doing that. For example, growing market share, including for the high rim diameter products and accelerating
our performances. And the investment which we considered for the next midterm business plan of using the existing facilities to modify them to
produce the premium products, which we call replacement or substitution, is already under consideration. So those are considered.
So for one thing, we have a lot of potential strategic investment projects or items on the table. And of course, ENLITEN is another major item. We
must create a big movement forward and carry it out in advance of the plan. In that sense, we are giving a big push for this development. Naturally,
resources will be needed. The fact that we are moving up the pace of our aggressive initiatives mean that we are now making selections out of
many potential projects. However, with regards to M&A, because for them, partners will be involved, in these cases, while we are considering
various possibilities, we have yet to come up with definitive conclusion. As of now, as I have been saying repeatedly, there is strategic areas such
as solutions and digital area as well as others, including the tires in the premium range, which are being looked at. I would think that the honest
answer would be that if you ask us whether we had made any decision or conclusion, the answer is not yet.
REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us
consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies.
NOVEMBER 11, 2021 / NTS, 5108.T - Q3 2021 Bridgestone Corp Earnings Presentation
|
