KDDI positioned the three-year period from the fiscal year ended March 31, 2014 as a time of "full-scale income growth." As the pillar of our domestic business strategy, we promoted and deepened our 3M Strategy (multi-network, multi-device, and multi-use) while pursuing our Global Strategy. As a result of these initiatives, operating income was ¥832.6 billion (up 25.1%) and the annual dividend was ¥70 per share (a dividend payout ratio of 35.4%) as of March 2016, the last year of the period. This marked an achievement of the medium-term targets set out in April 2013, as well as double-digit growth in operating income and a dividend payout ratio above 30% for each of the three fiscal years through to the fiscal year ended March 31, 2016.
In the telecommunications market in Japan, business conditions are becoming more challenging as the products and services of mobile telecommunications carriers have become increasingly homogenized and inexpensive SIM card services provided by mobile virtual network operators gain popularity.
On the other hand, new business opportunities, such as in the IoT industry, are on the rise. We must "evolve" with a sense of urgency, instead of taking the well-worn path in business, while rapidly responding to changes in the business environment.
With such a background, KDDI announced new medium-term targets in May 2016. We will pursue growth via three business strategies that aim to (1) sustainably grow the domestic telecommunications business, (2) maximize the au Economic Zone, and (3) ambitiously develop global business and satisfy both profit growth and shareholder returns by achieving a CAGR of 7% in operating income and maintaining a dividend payout ratio of 35% or above over the three years through to the fiscal year ending March 31, 2019.
Toward the achievement of this new medium-term target, we will make a company-wide concerted effort to continue improving corporate value while realizing sustainable growth, and lead the new era with a stronger sense of urgency.
President, KDDI CORPORATION
Year-on-year comparisons above are based on IFRS.
Provisional accounting treatment was applied for the business combination conducted in the fiscal year ended March 31, 2016 and the data has been replaced with confirmed values for the fiscal year ended March 31, 2017.