Medium-term Management Plan

Extend the target period for Medium-term Management Plan "CAN20 2nd Phase"

May 14, 2020 Gunze has decided to extend the target period for the current Medium-term Management Plan "CAN20 2nd Phase" which is scheduled to finish in March,2021 (FY2020). The company has also decided to postpone the announcement of a new Medium-term Management Plan which is scheduled to start in April,2021 (FY2021).
The reason that the earnings forecast will be difficult to predict in march,2021 as the end of the period of “CAN20” in the environment where the future is unpredictable under the impact of COVID-19 is spreading globally. Establishing a new medium-term management plan under the uncertain circumstance, the plan will be had several concerns with its reliability.
Then, the company has decided to extend the target period for the current CAN20 and the final fiscal year will be in March,2022 (FY2021).
Although the target period will be extended, the target figures for the final year will be the same as original ones.

The extending period of current Medium-term Management Plan "CAN20”
It will be 5 years from FY2017 to FY2021.
Publication time of the next medium-term management plan
It's scheduled to be announced in May,2022.

Outline of Medium-term Management Plan "CAN 20"

May 13, 2014GUNZE has formulated its seven-year Medium-term Management Plan, called "CAN 20," to be in place through fiscal 2020. In the "CAN 20" plan, the key concept is "Focus and Concentration." The planning period is divided into the first phase (fiscal 2014 through fiscal 2016) and the second phase (fiscal 2017 through fiscal 2020). GUNZE will strive to realize the Group management vision.

Plan name

"CAN 20" (CAN Twenty)

Key concept

Focus & Concentration


7 years (FY2014 – FY2020)

1st Phase FY2014 – FY2016
2nd Phase FY2017 – FY2020

2020 Management Vision

Gunze contributes to society as a global company that provides customers with a special type of “comfort” which only Gunze can offer,by further reinforcing its strength.

2020 Management Objective

Set the health and medical-related fields that help improve the quality of life of people as the core source of growth, and have each business establish a “one-of-a-kind” position in the industry in its respective field through focus and concentration.

Achievement in the 1st Phase

Rapid Progress of Medical Materials
(70% increase in sales)
  • Net sales increased 70% year over year, while operating income increased 300% a year over year
  • Sales of Bioabsorbable Reinforcement Felt expanded in the U.S.A.
Revival of Strong Apparel
(80% increase in operating income)
  • Women's innerwear
  • CUT OFF and Seam-free innerwear was a big hit
  • Legwear
  • Leggings pants that created new demand became a big hit
Entered into Apparel Retail Business
  • "Jeans & Casual the Dan" became a subsidiary (M&A)
  • Directly operated shops opened (factory outlet, family shop)

Fundamental Strategy for the 2nd Phase
Strongly promote the 3 basic strategies

Basic Strategy 1
Business strategy
in each segment
Basic Strategy 2
Creation of
new business
Basic Strategy 3
Reinforcement of management foundation

Basic Strategy 1
Business strategy in each segment

Revive growth in the Functional Solutions Business

Seek continuous growth of the Medical Materials Business

  • Construct a new factory and concentrate investment of management resources on new product development
  • Expand business by improving production and sales systems and develop Medical Materials into a core business as soon as possible

Tackle new fields through close linkage within the segment

By utilizing existing resources (functions, technology base, customer contacts) of the Functional Solutions business, enhance existing business and advance into new fields

Restructure film business
Rebuild business by combining extrusion technology and processing technology
Create new business by promoting collaboration inside and outside of the company
Provide industrial materials for medical field and automotive applications
Accelerate Growth in the Apparel Business

Implement strategies to expand new sales channels and sales areas

Actively expand new sales channels by leveraging the Apparel business’s comprehensive strengths
  • Rebuild the domestic EC business system
  • Tackle cross-border EC business in Chinese market
  • Build and expand successful models of directly operated stores (Factory outlet stores / Retail stores)
  • Incorporate retail business to acquire store development and operation know-how(Link with “Jeans & Casual the Dan;” utilize M&A)

Accelerate growth by strengthening differentiated technologies/products, brands and sales floor promotion capabilities

By strengthening development of differentiated products, actively expand innerwear sales, centered on women's innerwear
  • Strengthen NB’s apparel and develop medical-related products
  • Expand product planning based on new lifestyles
Steady expansion of the Lifestyle Creation Business

Strengthen current business base and achieve steady business expansion

  • Expand the sports club business
  • Strengthen shopping center business

Basic Strategy 2
Creation of New Business

Promote commercialization of 1st phase projects

Nightingale Project
(health and medical business expansion)

  • Expansion of "Medicare" (Medical Apparel) since 2016
  • Promotion of commercialization of high-performance wires for medical applications (expansion of applications and foray into overseas markets)

2nd phase sales target: 2 Billion yen

Edison Project (creation of new business)

  • Promote new business creation strategy in 2 business frameworks
    (Highly functional textiles and Sheet materials)

2nd phase sales target: 3 Billion yen

Expand business areas (M&A)

M&A focused on synergy with current business

  • Expand the Apparel retail business
  • Expand Medical-related business

2nd phase Investment budget: 10 Billion yen

※New business and M&A are not included in the numerical targets of CAN 20

Construct a mechanism to create new business

Strengthen efforts to create new business based on the review of the 1st phase

  • Promote each division's new business challenge by implementing "stretch plan"
  • Search for new businesses that are not affected by the present market status
Stretch Plan
New initiatives to promote new business creation in each segment

Basic Strategy 3
Reinforcement of Management Foundation

Improve competitiveness by strengthening manufacturing base

Build a strong production system by enhancing on-site strengths

  • Strengthen production capabilities to respond to anticipated changes in product portfolio
  • Pursue production efficiency not affected by the complexity of product specifications

Fiscal 2020 Target
UP 30% (vs. FY2016)

Improve the productivity of the entire GUNZE Group based on common indicators, including overseas companies

Strengthen the management structure

To become a company that can continuously contribute to society
To become a company that can continuously respond to new lifestyles

CSR Committee
Strategic CSR to solve social issues through business activities
Work Style Reform Committee
  • Improve value-added productivity through business reformation and establish strict work time management
  • Implement work style reform to establish a flexible and creative work style to support diversity, such as empowerment of women, and to meet workers' needs

SDGs 世界を変えるための17の目標

The GUNZE Group shall remain committed to ESG (Environment, Society, Corporate Governance) through its core business

Numerical Targets

FY2020 management goals (consolidated)

Net Sales
(Millions of Yen)
136,579 150,000 +13,420 110%
Operating Income
(Millions of Yen)
4,206 8,000 +3,794 190%
Operating Margin
3.1 5.3% +2.2%
Net Income
(Millions of Yen)
3,102 5,600 +2,498 180%
2.5 4.7 +2.2%
2.9 5.0 +2.1%

The assumed exchange rate for FY2020 is 110 yen
(The plan does not include new business, M&A, and“stretch plan")

ROE: 5.0% or over

Breakdown by Business Segment

Breakdown by Business Segment

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Investment Strategy

Capital investment
2nd Phase (From FY2017 to FY2020)

Capital investment

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R&D expenses
2nd Phase (From FY2017 to FY2020)

R&D expenses

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Financial Strategy

Asset efficiency

(Billions of yen/Times)

Amount Turnover ratio Amount Turnover ratio Amount Turnover ratio
Total Assets 169 0.81 170 0.88 1 0.07
Inventories 30 4.54 29 5.02 (1) 0.48
(Operating Income to Total Assets Ratio)
2.5%   4.7%   2.2%  

Capital policy
2nd Phase (From FY2017 to FY2020)

Payout Ratio
50%(Dividend per share shall be 75 yen or more)
Total return ratio
100% (Flexible acquisition of treasury stock)
*Except when a large investment is made