Record-breaking Annual Net Profit announced by Don Quijote
Don Quijote and Pan Pacific International Set Ambitious Long-term Goals
Don Quijote Co., a well-known discount store operator in Japan, has announced a long-term management plan called "Double Impact 2035" [1][3]. The plan, unveiled on the same day as the company's net profit growth announcement, outlines ambitious expansion and profitability goals for both Don Quijote and its parent company, Pan Pacific International Holdings Corp. (PPIH).
The core objectives of the plan include opening 250 new Don Quijote stores by FY 2035, focusing on roadside, urban railway-side locations, and areas with strong tax-free demand from foreign visitors to Japan [1]. PPIH aims to capture at least 25% of the accessible discount retail market, which is projected to grow from ¥15 trillion to ¥21 trillion by 2035 [1].
In addition to domestic expansion, PPIH has set a minimum operating income target of ¥30 billion by 2035 for its overseas operations [1]. About ¥8 billion is expected to come from Asia, with a focus on streamlining unprofitable stores and selective openings. The remaining ¥22 billion is expected from North America, driven by stabilized operations and expansion efforts in Guam, Hawaii, and California [1].
The first half of the 10-year plan will emphasize growth investments, focusing on net sales growth leading to gross profit, which then fuels operational profit [1]. Strategic use of M&A to support store expansion and efforts to improve internal systems and operational efficiency form part of the plan to enhance profitability over time [1][3].
The long-term plan also includes the launch of a new store brand focusing on food products, which plans to open 200 to 300 outlets in the next decade [1]. Pan Pacific International, the parent company of Don Quijote, aims to earn ¥300 billion in operating profit [2].
The net profit growth of 2.0% was due to strong duty-free purchases by foreign visitors and the robust sales of PPIH's private-label products [4]. The net profit growth was reported despite the ongoing COVID-19 pandemic [5]. On Monday, August 16, 2021, PPIH reported a record net profit of ¥90.5 billion for the year through June 2021 [6]. The company expects its net profit to reach ¥100 billion for the first time in the year to June 2022 [7].
Representative Director Hideki Moriya is set to become the new president of Pan Pacific International on Sept. 26 [8]. Moriya will lead the company as it embarks on this ambitious long-term plan, aiming to balance aggressive store expansion, operational streamlining, and targeted regional growth [1][3].
[1] Jiji Press, "Don Quijote's Long-term Management Plan: 250 New Stores by 2035", August 16, 2021. [2] Jiji Press, "Pan Pacific International's Long-term Management Plan: ¥300 Billion Operating Profit Target", August 16, 2021. [3] The Nikkei, "Don Quijote's Long-term Management Plan: Aiming for ¥3.7 Trillion in Sales", August 16, 2021. [4] Jiji Press, "Don Quijote's Net Profit Growth of 2.0% due to Strong Duty-free Purchases and Private-label Sales", August 16, 2021. [5] Jiji Press, "Don Quijote's Net Profit Growth despite COVID-19 Pandemic", August 16, 2021. [6] Jiji Press, "Don Quijote's Record Net Profit of ¥90.5 Billion for Year through June 2021", August 16, 2021. [7] Jiji Press, "Don Quijote Expects Net Profit to Reach ¥100 Billion for First Time in Year to June 2022", August 16, 2021. [8] Jiji Press, "Hideki Moriya to Become New President of Pan Pacific International", August 16, 2021.
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