We also took this opportunity to revise our “Ideal Group image for 2030,” based on our current management environment and the latest Group strategy reevaluation. We added the phrase focused on food to our previous Group image to establish the new image of “A world-class retail group focused on food that leads distribution innovation through global growth strategies centered on the 7-Eleven business and proactive utilization of technology.” This clarifies the future direction of our Group based on our growth strategies. To realize this image, we reconfirmed the necessity of implementing the various policies currently underway at our Group.
Furthermore, in view of the excellent current results at our Group and the strategy reevaluation that will be described later, we updated our bet365 通貨gement Plan and revised upward our targets for FY2025^*1. The main revisions are as follows.

(i) EBITDA^*2
Revised from the initial target of 1 trillion yen or more to 1.1 trillion yen or more.

(ii) Operating CF^*3 (excluding financial services)^*4
Revised from the initial target of 800 billion yen or more to 900 billion yen or more.

(iii) Free CF level (excluding financial services)^*5
Revised from the initial target of 400 billion yen or more to 500 billion yen or more.

(iv) ROE
Revised from the initial target of 10% or more to 11.5% or more.

(v) ROIC (excluding financial services)
Revised from the initial target of 7% or more to 8.0% or more.

(vi) Debt/EBITDA ratio
Revised from the initial target of less than 2.0 times to less than 1.8 times.

(vii) EPS (CAGR)
Revised from 15% or more to 18% or more.

Through these target revisions, we seek even greater financial soundness, and we will concentrate our efforts on achieving these updated targets, and delivering sustainable growth and improving corporate value for the Group in a way that anticipates the future. (Fig. 2)

The Group Priority Strategy, established together with the bet365 通貨gement Plan, has also been reevaluated based on the new governance structure. The reevaluation involved various studies about strategic initiatives that help increase the corporate value of the Group, while taking into account the growth potential and efficiency of each business segment. We hired independent outside advisors to guarantee transparency and fairness in the reevaluation process. All directors, including the outside directors, examined strategic options for each business, including superstores (SST), and fundamental reform of Group business structures, without ruling out any possibilities. The result was a decision to develop a management policy for the Group that tackles the most important issue of the Group; namely, to leverage our historical strength in food and focus on the domestic and overseas CVS growth strategies, thereby optimally allocating management resources and becoming a top-ranked global retail group with food at its core.
We also decided the following Group policies to drive forward our growth strategies according to this management policy: (i) Develop a Group capital reallocation plan, and (ii) Establish a Strategy Committee. bet365 通貨erms of capital reallocation in (i), we will concentrate the distribution of cash flow (CF) to strategic investments bet365 通貨he CVS business, our Group’s growth driver. Also, through agile shareholder returns that include stock buybacks, we intend to achieve a cumulative total shareholder return ratio of over 50% from FY2023 to FY2025.^*
The Strategy Committee referred to in (ii) is composed solely of independent outside directors to monitor the progress of the Group Priority Strategies; namely, the domestic and overseas CVS business growth strategies, SST business transformation, and other strategic initiatives. The Strategy Committee will also continue to analyze and review the optimal group structure and strategic options including IPOs, spin-offs, etc., comprehensively and objectively to achieve the Group’s strategic goals. Based on these results, the Strategy Committee will provide advice to the Board of Directors to increase the Group’s medium- to long-term corporate value.

bet365 通貨he Group strategy reevaluation, we analyzed our strategies from both a qualitative and a quantitative perspective. The result was confirmation that the strength at the heart of our Group’s growth strategy is the food sector. Specifically, our CVS business is our growth driver, and we should further enhance the lineup and quality of our fresh and frozen food by taking into account changes in social structures and the consumer environment. bet365 通貨he SST business, we decided to accelerate strategies that focus on food synergies, including withdrawal from apparel businesses that we operate ourselves. bet365 通貨his way, we plan to maximize the use of the Group’s strength of food, which is the source of our competitiveness, in promoting the growth of 7-Eleven, Inc. (SEI) that is responsible for the CVS businesses in Japan and North America, as well as the other global CVS businesses. (Fig. 3)

Furthermore, in our reevaluation, we confirmed agabet365 通貨hat our SST business has the strength of food that supports the competitiveness of the Group. This is because the SST business in our Group has a wide lineup of products that is not present bet365 通貨he CVS business, and therefore it has constructed a comprehensive supplier network ranging from fresh food to processed food. The SST business has cultivated excellent product procurement capabilities and outstanding product development skills. Already, our Seven Premium private brand (PB) that was launched in 2007 has leveraged the SST business’s development skills and network to develop products over a wide range of areas, producing results that have been highly rated by customers. Results from our domestic and overseas CVS business, which is our growth driver, show a strong correlation between the sales composition ratio of fresh food (FF) and the ability to draw customers. Therefore, we reconfirmed that in order to maintain and improve our high competitiveness bet365 通貨he CVS business bet365 通貨he future, it will be essential to consolidate the food strength of the Group around the resources of the SST business.

SEI has expanded the Seven Eleven business in North America and driven the current excellent results across the entire Group. SEI is planning to deliver even further growth by promoting the following four growth strategies

(i) Strengthen original products

SEI has leveraged the knowledge of building a value chain, such as factories that manufacture original FF, which has been cultivated bet365 通貨he CVS business in Japan by SEVEN-ELEVEN JAPAN CO., LTD. (SEJ), in order to strengthen their value chain and enable the development and quality improvement of their own FF. bet365 通貨he future, they plan to expand these initiatives across the entire United States. Specifically, SEI is promoting quality improvement and lineup expansion of original FF by driving forward the construction of new factories dedicated to FF and introducing dedicated equipment and technology to existing FF factories. In addition, they are seeking to expand sales and profits by strengthening original products (FF, exclusive drinks, PB products) that have high gross margins. SEI’s goal is to increase the sales composition ratio of FF and exclusive drinks from the current 18.1% to 25% by FY2025, increase Seven Select (PB products) from 6.3% to 8.5%, and grow the composition ratio of original products to 33.5%.

(ii) Accelerate digitalization and expand delivery business

SEI launched the 7NOW delivery business in 2018, but it was the COVID-19 pandemic that sparked a surge in customer demand, resulting in a rapid expansion of orders and sales. SEI stores are withbet365 通貨wo miles of 50% of the entire United States population, and SEI has leveraged this competitive advantage to provide deliveries within an average time across the United States of 28 minutes. bet365 通貨he future, SEI plans further growth by providing even more diverse services, aiming for sales of billion by FY2025.

(iii) Create synergies through integration with Speedway

Synergistic effects from the FY2021 integration with Speedway are expected to reach 0 million by FY2022 and approximately 0 million by FY2023. Considering that this is excellent progress that greatly exceeds the initial plan, completing the integration on a store level and company-wide level is expected to create synergistic effects in excess of the values bet365 通貨he plan.

(iv) Expand business through M&A and opening new stores

Currently, the CVS market bet365 通貨he United States is fragmented, composed mostly of small- to medium-sized CVS chains. bet365 通貨he context of this market environment, SEI plans to rapidly expand its store network through M&A and by opening new stores to make sure that it captures business opportunities and continues its growth.
By implementing these four growth strategies, SEI will reform its business structure by raising the sales composition ratio of businesses centered on food, thereby greatly improving product gross margins and increasing the ROIC across all businesses.

Currently, 7-Eleven has deployed businesses across 19 countries and regions, and there remains significant margin for growth both bet365 通貨hese existing areas and in new areas. For this reason, in addition to the business model that relies on licensor capital strength and risk bearing based on conventional license contracts, 7-Eleven International LLC, which is in charge of strategy promotion at the global CVS business, is planning to accelerate profit growth by also incorporating new partnerships that realize growth with quality and speed by providing licensees with strategic investments and financing. They also plan to expand profit by drawing out the latent growth potential of licensees using business innovation methods, including the strength of food, which have led to the restructuring of SEI bet365 通貨he United States and remarkable growth. By doing this, they aim to establish a network of 50,000 stores* by FY2025 and achieve an EBITDA annual growth rate of 34% through FY2030 by opening stores in 30 countries and regions and performing strategic investments and financing, including M&A.

The SST business has contributed to the Group’s growth strategies by consolidating the strengths bet365 通貨he food sector cultivated over the years. Since 2016, we have also focused on structural reforms to address the stand-alone SST business issues of improving profitability and capital efficiency. bet365 通貨he future, we will pursue renewed growth by demonstrating the benefits of these structural reforms and promoting transformation through fundamental reforms in line with the strategic direction of the entire Group. To do this, we aim to implement five policies (Fig. 5) bet365 通貨he next three years to drive forward even greater fundamental reform of the SST business.

(i) Complete withdrawal from apparel business
Focus on food sector and withdraw completely from apparel businesses operated by ourselves

(ii) Acceleration of focus on Tokyo metropolitan area and additional closures
To accelerate focus of IY on Tokyo metropolitan area, add 14 store closures to the other store closures from previous store restructuring

(iii) Consolidation and restructuring of Tokyo metropolitan area businesses
Consolidate and restructure Tokyo metropolitan area SST businesses such as IY and York to maximize synergies and operating efficiency bet365 通貨he Tokyo metropolitan area

(iv) Development of strategic investment infrastructure
Construct a profit structure capable of further profit growth by using strategic investment infrastructure, such as the centralization of process centers, central kitchens, and online supermarkets

(v) Guaranteeing complete implementation and transparent monitoring
Ensure complete implementation and process management of reform policies by hiring external reform experts, and perform monitoring by the Board of Directors and Strategy Committee and share information transparently with shareholders

Through these initiatives, we aim to achieve at least 55 billion-yen EBITDA and 4% ROIC bet365 通貨he Tokyo metropolitan area SST business by FY2025. With these measures, we will transform the industry in Japan that was previously dominated by small- to medium-sized enterprises with operating revenue of less than 1 trillion yen by creating a large-scale, high-profit SST business, thus establishing a unique business position bet365 通貨he market.
Note that based on the Group’s capital reallocation plan, investments bet365 通貨he SST business will be made using the CF created withbet365 通貨he SST business. No allocation of CF generated by the CVS business is anticipated

We will renew our Group management structure in order to expand Group businesses through global growth strategies and implement fundamental structural reforms in areas such as the SST business, as well as to strengthen the Group governance structure. Specifically, we will change the representative director structure to a three-person system to ensure greater strength and stability for the Group management structure from a medium- to long-term perspective. Also, in order to improve execution capabilities and driving force for growth strategies and business structure reforms by segment and achieve the bet365 通貨gement Plan on a consolidated basis, we will appoint a for each business segment. Furthermore, in corporate departments, we will establish a Chief x Officer (CxO) in each department to strengthen the expanding management team of the overall Group, while enhancing the structure of each strategic corporate function and increase the strategic driving force.