Shinsegae to Cancel Over 200,000 Treasury Shares Annually for 3 Years... Strengthening Shareholder Returns

Shinsegae is set to actively enhance its corporate value through a value-up program. This follows the purchase of treasury shares worth 105 billion KRW this year and the announcement of concrete plans to increase corporate value.

Shinsegae, Gwangju Shinsegae, Shinsegae International, and other listed affiliates of the Shinsegae group each held board meetings and disclosed their corporate value enhancement plans on the 27th. The disclosures included ▲future development plans ▲medium- to long-term return on equity (ROE) targets ▲and treasury share cancellations.

Shinsegae Department Store Gangnam Branch. Provided by Shinsegae

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To enhance corporate value, Shinsegae will first strengthen shareholder returns. The core strategy is to increase shareholder value through treasury share cancellations and to raise the minimum dividend per share as well as the predictability of dividend payments. To reinforce shareholder returns, the company has set a goal to achieve consolidated sales of 10 trillion KRW by 2030 and to improve profitability.

Shinsegae plans to cancel more than 200,000 treasury shares annually. Following the purchase of treasury shares worth 105 billion KRW this year, the company aims to cancel at least 2% (200,000 shares) of treasury shares each year over the next three years to enhance shareholder value.

The minimum dividend per share will be raised from the current 3,500 KRW to 4,000 KRW. By 2027, the dividend per share is expected to gradually increase by more than 30% from the current level.

Department stores and duty-free shops will expand market dominance through core store renovations. In the short term, the Heritage building (formerly the Jeil Bank headquarters) will be renovated into a department store and opened by 2025. The food hall at the Gangnam branch will also be renovated and expanded to the largest scale. Going forward, Shinsegae Department Store plans to start expanding the Gwangju branch in 2028 and develop the Suseo branch (2029) and Songdo branch (2030) into landmark-type department store complexes.

The duty-free shop will complete construction of the Incheon Airport Terminal 2 store by 2025, and in the first half of 2026, the downtown Myeongdong store will reopen with strengthened luxury brand offerings.

Shinsegae has also set a target to raise its consolidated return on equity (ROE) from around 5.4% in 2023 to 7% by 2027 through efficient investment execution and cost reduction. The entire group plans to improve profit margins by efficiently managing costs and prioritizing efficiency and profitability in new investments.

The department stores will increase sales through renovations of existing stores and stabilize profits from in-house businesses such as the beauty select shop 'Chicor' and 'Factory Store.' They also plan to expand new revenue sources such as advertising income. Affiliates like Shinsegae International will reorganize their brand portfolios and increase sales of in-house products to improve profit margins.

Shinsegae also plans to actively enhance communication with shareholders. IR materials will be disclosed in both Korean and English on the company website to improve information accessibility for overseas investors. Additionally, domestic institutional investor NDRs (Non-Deal Roadshows) will be held quarterly, and overseas institutional investor NDRs will be expanded to 1-2 times annually.

A Shinsegae representative stated, "In response to the government’s value-up policy and to raise the undervalued corporate value, we have reviewed and established plans to improve overall company operations. We will continuously strengthen our core business competitiveness and become a top-tier company with long-term competitiveness through active shareholder return policies such as treasury share cancellations and dividend increases."

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