Top Message

Since last April, I have run the SATO Group under the management objective of “Concentrate resources on our auto-ID solutions business (DCS & Labeling +One), maximize our strengths, and establish sustainable growth and stable profits.” As a result, we posted highest-ever sales and operating income in consolidated figures for FY 2018.

Our Auto-ID Solutions business raised its revenue and profits from the previous year in both its Japan and overseas sectors that are growing steadily thanks to the variety of strategies that we have put in place over the past years. The IDP business that centers on DataLase of UK and in which we are strategically investing to develop into a pillar for our future business also undertook its R&D activities largely as planned. These outcomes have led to consolidated sales of ¥116,179 million (up 2.5% from previous fiscal), operating income of ¥7,679 million (up 22.9%) and ordinary income of ¥7,618 million (up 29.4%), each being our highest-ever figures. Profit attributable to owners of parent, on the other hand, ended at ¥3,773 million (down 7.4%) after reflecting impairment loss associated with our UK subsidiary.

■ Auto-ID Solutions business (Overseas)

Establishing the groundwork for koto-uri, to accelerate growth

We will share all the know-how we have accumulated on “selling the solution, not the product” (“koto-uri”) to answer the latent demands of markets and customers in Japan with our subsidiaries overseas over the next three years through the following measures to help them establish the groundwork for pursuing even greater sales and profits.

  1. Invest actively into means (e.g., human resources, offices, alliances) that would help us enter high-potential countries/regions (e.g., India, Vietnam, North America) and specific areas/industries that we narrow down within those countries/regions.
  2. Expand our line of products, services and solutions by, for example, promptly rolling out printers with strong market appeal.
  3. Enhance our sales/CRM system for sharing and maximizing the use of customer/sales information at the global level.
  4. Seek and build the best alliances per industry/application.
  5. Share with subsidiaries sales tools that help them reach deeper into each industry; set up a global marketing function.

■ Auto-ID Solutions business (Japan)

Taking koto-uri to the next level while improving profitability

For the Japan market, SATO continues to deliver solution services that help customers solve their business challenges arising from social issues of the times that include declining birth rate, aging population and shortage of labor. We will enhance the customer value of these solution services via the following measures, while passing on our koto-uri know-how to overseas subsidiaries to lead and speed their shift to selling solutions.

  1. Foster solution experts
    In line with our aims to deliver sophisticated solutions, we plan to recruit talents with high expertise while enhancing training programs so that we can station more personnel to regions in need.
  2. Build stronger sales network and localized partnerships
    We have recently strengthened our national coverage from opening five new sales offices. It is on this infrastructure that we will work to drive thorough sales activities across each prefecture with solution products that are customized to solve business challenges in more finely segmented regions/industries — an initiative common to our overseas business. And through alliances we would form with partners of strong presence in specific regions or industries, we target to further increase our market share by suggesting new, expanded uses of our solutions to existing customers.

■ IDP business

R&D geared toward commercialization progressing largely as planned

We position the IDP business as a vital segment that brings us future growth, as it can potentially create value for consumers in this era where their personal preferences become more pronounced and complex than ever. Our plan is to commercialize our high-speed, high-definition, advanced-monochrome technology currently under development during this fiscal year to roll out at full scale in FY 2020.

■ Dividends

Total dividend for the fiscal year is planned to increase five yen from the year before to reach ¥70, based on the interim dividend that is decided at ¥35 (up ¥3) and year-end dividend that is proposed at ¥35 (up ¥2). Keeping to the “(returns to) four stakeholders” clause in our Credo and our policy to provide increased dividends in a steady and sustainable manner, we will ceaselessly strive to improve our capital productivity and shareholder value in future.

On behalf of employees and the management, I sincerely ask for your continued support of our businesses.

Excerpt from Notice of the 69th Annual General Meeting of Shareholders, June 2019

President and CEO
Ryutaro Kotaki