The Benesse Group shifted to a holding company structure on October 1, 2009. Following the shift, the Group identified five growth business domains: domestic education, overseas education, lifestyle, senior/nursing care, and language/global leadership training, and began concentrated investment of management resources in these areas. Going forward, the Group as a whole will work to achieve long-term growth through this investment.

Fiscal 2010 marks the final year of the current medium-term management plan, as well as the first full fiscal year since the shift to a holding company structure. Management therefore views this year as an important time to take the first steps toward long-term growth, and to this end will focus on the following three points.

The first point is to strengthen and expand existing businesses. In the correspondence course business, the mainstay of the domestic education business domain, Benesse will aim to achieve stable growth even as Japan's birthrate declines, by providing courses tailored to each individual's needs, thereby supporting children's enthusiasm and motivation to learn. Furthermore, the Company will introduce a new generation of products that take advantage of media such as the internet with a view to boosting customer share in the market and further expanding the business. In the prep school business, the Company will work to enhance its service to customers by continuing to strengthen the alliance between the correspondence courses and high school businesses.

In the senior/nursing care business domain, in response to the growing market for senior nursing care, in March 2010 Benesse made Bon Sejour Corporation a wholly owned subsidiary. Together with Benesse Style Care Co., Ltd., this new addition creates a structure that is capable of providing services that meet a wide spectrum of needs. Going forward, the Company will steadily increase the number of nursing homes and expand the business while continuing to provide the safe and reliable high-quality service that consumers have come to expect of Benesse.

The second point is global business development. In the overseas education business domain, Benesse has been developing the correspondence course business in China, Taiwan and South Korea, targeting mainly preschool-aged children. As of the end of April 30, 2010, Benesse has raised the number of enrollees in the overseas business to 520 thousand. Moving forward, the Company aims to further expand this business, particularly in the dramatically growing Chinese market, by enhancing products and services and strengthening marketing.

In the language/global leadership training business domain, Benesse aims to restore performance at subsidiary Berlitz International, Inc. as soon as possible, and to quickly establish new services that provide added value to conventional language lessons. Drawing on existing management resources in such as the expansive network in 70 countries around the world and the teaching force of highly skilled instructors, Berlitz will strengthen training programs for business leaders active around the world and enhance one-on-one language lessons using the internet. Berlitz will also work to expand the ELS business, which teaches English to students who want to study overseas, mainly in the United States, to focus on other countries as well, including Australia and Canada.

The third point is initiatives in new business domains. In the lifestyle business domain, Benesse will move beyond the existing magazine media to expand multimedia communities that use a combination of internet, mobile phones, and other access methods, and build a new business model through the internet and mail-order businesses.

In addition to these efforts, the Company will work to create a lean corporate structure that emphasizes productivity and efficient use of capital and assets. Capital policy is another key issue for the Benesse Group. Benesse has clearly stated its goal of achieving a dividend payout ratio of at least 35%, and in fiscal 2009, the Company expects to pay an annual dividend of ¥90 per common share, for a payout ratio of 40.6% (on a consolidated basis). Benesse repurchased 400,000 shares during the fiscal year, and as of March 31, 2010 holds 7.71 million treasury stock (the amount of ¥26.5 billion), representing 7.3% of all issued shares. Benesse plans to conduct further repurchases as deemed appropriate. In order to preserve sound management, the Group will strive to conduct management with emphasis on cash flows. Benesse also intends to actively use cash reserves for business investment to drive medium- to long-term growth, including M&As, R&D, and investments to strengthen the business foundation. The Company will be particularly proactive regarding M&As in fields that will further strengthen the Group's core competencies.