To Our Shareholders and Investors
BE GLOBAL 2023, our mid-term management plan announced in September 2018, entered its final year in the fiscal year ending June 30, 2023. The previously announced results for the fiscal year ended June 30, 2022 are at the lower end of the target range in terms of sales and operating income, but some KPIs, including the recurrent sales ratio, which we have been aiming to achieve in order to transform our business model and accelerate growth, are proving difficult to achieve.
Therefore, we began formulating the next medium-term management plan in the latter half of 2021. Together with the Group management strategy executive team, we started by reconfirming the Group's management philosophy, discussed what the Group should do to realize its vision, and summarized this as the Avant Group's materiality. In order to "become a software company that helps increase corporate value," as stated in this materiality, we believe it is necessary to transition to a new organizational and governance structure, and we started the new structure on October 1, 2022, after obtaining your approval at the General Meeting of Shareholders. The new DIVA is responsible for "consolidated financial disclosure DX" to promote creative disclosure, the new AVANT is responsible for "management information DX" to visualize corporate value, and the new Zeal is responsible for "data utilization platform DX" to accelerate data-driven management. New Zeal is responsible for "DX of Data Utilization Infrastructure" to accelerate data-driven management. These three companies aim to accelerate the growth of existing businesses and create new growth businesses.
The environment surrounding the group companies is favorable over the medium to long term. We are seeing a widespread belief in the public and private sectors that companies need to decisively pursue digital transformation, which is not simply about efficiency through digitization, but about transforming their business models through the use of data and digital technology. On the other hand, in order to continue sustainable development while addressing global issues such as global warming and economic disparity, corporate managers are now expected to engage in close dialogue not only with shareholders but also with customers, employees, and local communities, and to consider the balance among economy, society, and environment. For companies, this means that in order to increase corporate value, it is now necessary to organize a variety of information, including financial and non-financial information, and make efforts to utilize this information in management decisions. "Spreading Accountability," which is the mission of our group, is exactly the "Management DX" that changes company management through information technology, and our existence value matches the needs of the times.
The details of the next mid-term plan will be explained again when the new structure begins full-scale operations. Although upfront investment may be a burden for the time being, we ask for the understanding and continued support of our shareholders and investors as this investment is necessary to realize accelerated growth over the medium to long term.
Tetsuji Morikawa
President and Group CEO
Avant Group Corporation