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We have been aiming to expand our customer base even further with a continued emphasis on "Strategy and Speed" since the fiscal year ended March 2006.
Looking back on the fiscal year ended March 2007, it was an extremely successful year with the favorable start to MNP and the integration of the FTTH business in terms of business development and performance, bringing us steadily closer to our next growth stage.
Now the time has come to indicate a direction in our drive for growth. In April 2007, we have unveiled our medium-term target— "Challenge 2010", which is the strong message that in collaboration with our customers, business partners, employees, and other stakeholders, we are determined that KDDI will be a sustained growth company.
On a numbers basis, our consolidated targets for the fiscal year ending March 2011 are operating revenues of ¥4 trillion and operating income of ¥600 billion. Rather than a commitment to figures, these targets have been set to pose a challenge to KDDI Group employees to work together and push forward in making this important. One of the purposes behind our drive toward these targets is to become a company that can achieve sustainable growth through "quantitative expansion" and "qualitative enhancement" by being No.1 for customer satisfaction in all the services we offer.
The following are the main issues to be addressed in pursuing "Challenge 2010".
In the Mobile Business, our most important task is to utilize the approximately 30 million-strong subscriber base in expanding our business domain into peripheral areas around our core communications business to maximize the revenues per subscriber.
In the Fixed-line Business, particularly our current area of emphasis, the FTTH business will depend on services that appeal to customers and thorough cost reduction. We aim to rise to the challenge and move into the black not only in our FTTH business, but also in our overall Fixed-line Business by March 2011.
Another major issue is the achievement of Fixed Mobile and Broadcast Convergence (FMBC) services for the consumer market. Ahead of the integration of our infrastructure through the "Ultra 3G" network, we face the urgent task of integrating services at the upper level centering on content and media. A key point in the success of the FMBC business will be to take advantage of our position as the only company capable of developing mobile and fixed-line businesses together. We will also be aggressively expanding into other business domains. Of our targeted operating revenues of ¥4 trillion, we will be aiming for new businesses to contribute approximately 5%.
KDDI regards the return of profits to shareholders as a priority management issue, our main method of returning profits to shareholders will remain dividends. While maintaining a certain level of capital investment to attain sustainable growth, we will continue to aim for stable dividends with a payout ratio of 20% or more.
Based on growth achieved through a balance between "quantitative expansion" and "qualitative enhancement", we plan to meet the expectations of our shareholders and investors. In meeting the challenge of the future, we look forward to your continued support.
August 10, 2007
Tadashi Onodera
President and Chairman
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Please see four manifesto that become basic of company's basic principles of KDDI.
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