Shinsegae, a leading South Korean retail conglomerate, has announced a comprehensive value enhancement program aimed at boosting its corporate value. The company will focus on strengthening its core business competitiveness while implementing a series of measures to enhance shareholder returns.
In a recent board meeting, Shinsegae along with its subsidiaries, Gwangju Shinsegae and Shinsegae International, outlined detailed plans for future development, including medium to long-term return on equity (ROE) targets and share buybacks.
Enhanced Shareholder Returns
As a cornerstone of the value enhancement program, Shinsegae will significantly boost shareholder returns. This includes a share buyback program, where the company plans to repurchase 2% (or 200,000 shares) of its outstanding shares annually over the next three years. Additionally, the minimum dividend per share will be increased from ₩3,500 to ₩4,000, with a gradual 30% increase in dividend per share by 2027.
Business Expansion and Store Renovations
To drive growth, Shinsegae will focus on renovating key department stores and expanding its global footprint. In South Korea, the company plans to open a new department store in the former Jeil Bank building in 2025 and unveil a revamped food hall at the Gangnam branch. Furthermore, Shinsegae will continue to renovate its flagship stores in Gangnam, Main, Centum City, and Daegu to solidify its leadership position in the luxury market.
For international expansion, Shinsegae International will focus on expanding its beauty brands, such as A'muse, Swiss Perfection, and Yeonjak, and its contemporary fashion brand, Harley-Davidson Collections.
Efficiency and Profitability
Shinsegae aims to improve its connected ROE from 5.4% in 2023 to 7% by 2027 through efficient investment and cost reduction. The company will focus on optimizing promotional expenses and labor costs while prioritizing profitability in new investments.
Strengthened Investor Relations
To enhance communication with investors, Shinsegae will provide IR materials in both Korean and English on its website. Additionally, the company plans to conduct Non-Deal Roadshows (NDRs) with domestic institutional investors on a quarterly basis and with overseas institutional investors once or twice a year.
“We have developed this plan to respond to the government’s value-up policy and to enhance the undervalued corporate value of our company,” said a Shinsegae spokesperson. “By consistently strengthening our core business competitiveness and implementing proactive shareholder return policies such as share buybacks and dividend increases, we aim to become a world-class company with long-term competitive advantages.”
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