May 8, 2007
FOR IMMEDIATE RELEASE
Publicity Division
Oriental Land Co., Ltd.
Announcement of New Mid-term Business Plan
“Innovate OLC 2010”
URAYASU, CHIBA—
Oriental Land Co., Ltd. announced “Innovate OLC 2010,” a new mid-term business plan effective through March 2011. Through profit growth and appropriate allocation of resources, the plan will build a management base for stable long-term growth for the OLC Group, while also working to provide the general public with emotionally moving experiences. The next four years will serve as “a period to promote new growth for the OLC Group ” under the challenging business environment of Japan with its diversification in people’s values, declining birth rate, aging population and changes in employment conditions. To realize the plan’s goals, the following three basic policies have been established.
1.
Strengthening our core business (Tokyo Disney Resort) to increase profit. a.
Enhancing quality We will enhance the quality of the Guests’ experience at the Parks, and will strengthen our efforts toward achieving maximum customer satisfaction (CS). To realize this, we believe it is also necessary to enhance the work environment of our Cast Members (ES: employee satisfaction), and will strengthen our management to achieve this end. These efforts will be combined with various events that will take place in the fiscal year ending March 2009, such as the “Tokyo Disney Resort 25th Anniversary” campaign, the opening of the Tokyo Disneyland Hotel and the opening of the permanent Cirque du Soleil theater. Thus, we will enhance Guest experiences by strengthening our services and by providing increased programs and facilities at the Resort.
b.
Clarifying our targets We will clarify our target customer segments, and will develop programs that meet the needs of individual Guests as well as expanding our market reach, thereby providing a more emotionally satisfying experience to a broader number of Guests. In addition, we will increase our efforts in creating programs that will guarantee attendance without being affected by external factors such as the
weather, thereby augmenting Park attendance results.
c.
Increasing cost efficiency We will increase cost efficiency by containing fixed costs, increasing labor productivity, and reducing costs based on scale merit for the OLC Group, thus realizing profit that is not affected by Park attendance figures.
2.
Establishing a foundation for new growth
In order to realize long-term growth for the OLC Group, we will develop new areas of business that create venues beyond the Tokyo Disney Resort that continue our Business Mission of providing “happiness and contentment for our Guests by offering them wonderful dreams and moving experiences.” To that end, OLC is currently working with other companies and looking into a number of plans that take advantage of the company’s strengths in creating environments that bring people together and encourage interaction. The company aims to establish the details of these new business projects by March 2011. And, as part of these efforts, we have now begun taking specific steps toward realizing an entertainment facility project, which has been jointly advanced by Oriental Land Company and The Walt Disney Company.
Entertainment Facility Project
The project has been created to develop a Disney-style indoor entertainment facility
in a city outside of the greater Tokyo metropolitan area after 2010.
The facility, offering entertainment, dining and shopping, will provide a more
accessible place for people outside of Tokyo to enjoy the world of Disney in a way that is different from the experience provided at the Disne y Parks. [Note: Only the research-development cost for this project has been included in the mid-term business plan.]
In addition to expanding Disney-related business opportunities through the advantages of the strong partnership we have developed with The Walt Disney Company over the years, the company will also look into a wide variety of long-term business opportunities without confining itself to the Disney brand or the Maihama area.
3.
Enhancing the value of the OLC Group
The OLC Group will increase cash flow allocations to our shareholders, and will work toward increasing profit returns by setting a goal of a dividend payout ratio of 35% or more from the fiscal year ending March 2008. Furthermore, we will raise ROE by achieving profit growth and providing direct profit returns. In order to enhance the value of the OLC Group, it is essential that we raise the social value of our company in addition to our economic value. As such, we will take active measures toward upgrading our CSR (Corporate Social Responsibility), building stakeholders’ trust through compliance to laws and regulations, and increasing programs that utilize the company’s strength in developing “family ties” and “learning.” All employees regardless of rank will share these ideas for CSR, and the company will develop new programs that are grounded on social responsibility, thereby enhancing our corporate value.
The OLC Group will also strengthen its efforts in developing its human resources. We will nurture the development of key personnel in each corporate division, as well as provide new and challenging opportunities for our employees both within and outside of the company. Through such efforts, we will develop personnel who are capable of advancing our business, thereby creating new value for our company.
Target management index for “Innovate OLC 2010”
1.
Consolidated net income : 27 billion yen level We aim to achieve a net income of 27 billion yen level – the company’s record high – for the fiscal year ending March 2011 (165.6% compared with the fiscal year ended March 2007) through cost reductions and increased revenues from the opening of the Tokyo Disneyland Hotel and permanent Cirque du Soleil theater.
2.
Payout ratio of 35% or more The OLC Group will work toward further increasing shareholder returns. We will raise the payout ratio to 35% or more from the fiscal year ending March 2008, taking active measures to return profit gains to our shareholders.
# # #
