Tsi Holdings Co., Ltd. · TSE:3608
Tsi — Q2 FY2016 Earnings Presentation
30 slides from Tsi's earnings presentation, Oct 15, 2015
Slide 1: Results Briefing: Consolidated Cumulative Q2ND Results of FY2016 Ending February
Results Briefing: Consolidated Cumulative Q2ND (March to August 2015) Results of 2016 Ending February 2015.10.15
Slide 2: Stock Price and Market Capitalization Transition
Stock Price and Market Capitalization Transition After the announcement of the appointment of a new CEO, Nikkei Index dropped by 6% but TSI hovers at +13% Nikkei Index TSIHD 2015/4/24 Announcement of New CEO 2015/5/28 Appointment of New CEO 2015/7/14 Q1ST Results Brieifing, 113 Strategic Alliance wi
Slide 3: I. Results Overview
I. Results Overview 3 TSI HOLDINGS CO., LTD. All Rights Reserved.
Slide 4: Consolidated Financial Highlights -Profit and Loss-
Consolidated Financial Highlights -Profit and Loss- While implementing the structural reform smoothly, ordinary profit result was close to the original forecast (Unit: Million yen) Consolidated Consolidated Cumulative Q2ND Cumulative Q2ND 2015 Ending Feb. 2016 Ending Feb. Composition Original Compos
Slide 5: Structural Reform -Progress and Results-
Structural Reform -Progress and Results- Project large profit improvement in 2nd half through the structural reform Detail Results Early Retirement Rejuvenation of creative personnel 528 Employees Closure of 12 brands, Closure Replaced 64 shops with continuing brands including liquidation of 292 sho
Slide 6: Sales Overview
Sales Overview Selection and Concentration: Invest on concentrated brands for sales growth Q2ND 2015 Ending Feb. (Unit: Million yen) 2015 Ending Feb. Closed Brands 86,593 -3,322 Others Others TOP10 Brands TOP10 Brands Sales Increase Sales Decrease Sales Increase Sales Decrease +1,786 -1,514 Q2ND +1,
Slide 7: Brands Overview
Brands Overview 1 Brands in TOP10 continue to mark high growth rate Y/Y Y/Y Y/Y 114.9％ 109.0％ 108.5％ ‣Year 2015 is the 35th anniversary of the brand ‣ While established reputation of its branding ‣ Functional Polo shirts(UV cut,super-absorbent continues to be favored by existing customers, & quick-d
Slide 8: Gross Profit Ratio Improvement
Brands Overview 2 At the same time, putting strong emphasis on improving gross profit ratio Gross Profit Ratio Improvement(%) nano・universe ROSE BUD Free's Mart MARGARET HOWELL STUSSY HUMAN WOMAN Callaway Apparel Other Continuing Brands Total TOP10 Avg. +1.7% & by P&D NATURAL BEAUTY BASIC PEARLY GAT
Slide 9: Brands Overview (Brand Sales Table)
Brands Overview 3 (Unit: Million yen) Consolidated Cumulative Consolidated Cumulative Y/Y Q2ND 2015 Ending Feb. Q2ND 2016 Ending Feb. Sales Gross Profit Sales Gross Profit Gross Profit Brand Sales Composition Ratio Composition Ratio Ratio 1 nano・universe 11,058 12.8% 53.2% 10,647 12.7% 58.4% 96.3% +
Slide 10: Consolidated Financial Highlight -SG&A Expenses-
Consolidated Financial Highlight -SG&A Expenses- Will continue to invest on concentrated brands but gain profit through stricter SG&A control towards 2nd half (Unit: Million yen) Consolidated Cumulative Consolildated Cumulative Consolildated Cumulative 2016 Ending Feb. Q2ND 2015 Ending Feb. Q2ND 201
Slide 11: Business Results Forecast for FY2016 Ending Feb.
Business Results Forecast for FY2016 Ending Feb. Downward revision of sales by 11bn yen, but keep the original forecast for operating profit, ordinary profit and net income (Unit: Million yen) FY 2015 Ending Feb. FY 2016 Ending Feb. Original Revised Against FY 2015 Ending Feb. Against Orignal Foreca
Slide 12: II. Future Growth Strategy
II. Future Growth Strategy 12 TSI HOLDINGS CO., LTD. All Rights Reserved.
Slide 13: Outline of Growth Strategy
Outline of Growth Strategy Customer • Develop sharp customer targeting and customer loyalty -> Introduce NPS® • Pricing strategy based on scientific analysis -> Secure gross profit by optimizing the Price sales price, proper sales rate, and the number of items purchased per customer • While enhancin
Slide 14: Brand Portfolio Map
Brand Portfolio Map Diversified brand portfolio to meet sophisticated needs of Japanese consumer Age of Target Consumer 50 40 30 20 10 Designer Elegance Select Casual Natural Sports 14 TSI HOLDINGS CO., LTD. All Rights Reserved.
Slide 15: Price Analysis Per Item
Price Analysis Per Item Scientific approach to analyze item price of brands Price elasticity occurs from +5% of price per item, where customer number declines significantly Customer Number Y/Y Brands which increased price and increased # of customers Existing Stores Brands which decreased price but
Slide 16: Pricing Strategy
Pricing Strategy Improve gross profit ratio through optimizing sales pricing, proper(full price) sales rate and the number of items per customer Basic Principles Cost Sales Price Customer # Net Sales +10% +10% -20% Decrease Increasing the sales price by the same amount as any cost increases in order
Slide 17: Product Analysis
Product Analysis Sharpen item originality and narrow down the number of styles Through analysis conducted at the end of Q1ST, top 80% styles make up 99% of total sales Sales/Style Analysis 2015FW # of Styles (avg. of 1 brand) 20% of styles contribute only 1% of total sales # of ％ 100 Narrowing Style
Slide 18: Improvement Measures NATURAL BEAUTY BASIC
Improvement Measures NATURAL BEAUTY BASIC Leverage the three factors of “customer, products, and sales” to develop customer loyalty Customer • Introduce the NPS® customer-loyalty index… Results up to the present listen to customers’ opinions, and reflect them in the products and sales • Sales for Q1
Slide 19: Overseas Business: Growth Strategy of m.tsubomi
Overseas Business: Growth Strategy of m.tsubomi Growth and new store strategy based on optimum scale and maximum room for growth of each brand is being formulated and promoted Background Leverage the existing businesses • Have realized super- • Strengthen response to “individual customers,” introduc
Slide 20: E-Commerce Business
E-Commerce Business E-Commerce ratio is increasing steadily through accelerating launch of O2O sites and overseas E-Commerce business E-Commerce Ratio Launch and enhancement of O2O sites Q2ND Actions to 2016 Ending Feb. strengthen own E-Commerce sites Own E-Commerce grew 125.2% Y/Y 10.4% Brands star
Slide 21: Progress of Cost Reduction Project
Progress of Cost Reduction Project Thorough procurement at the best market prices taking advantage of the purchase scale of the TSI Holdings Group as a whole (Unit: Billion yen) Room for Actions aimed at realizing the financial results Project cost Project reduction ・Advertisements in magazines Deci
Slide 22: Revenue Improvement Scheme -Operating Profit-
Revenue Improvement Scheme -Operating Profit- Strategy to Increase Operating Profit [Operating Profit] 1.4 bn yen contribution (profit base) in line with the 26 bn yen increase in sales, Target 2%pt improvement in the gross profit including sales from stores opened in place 14 bn yen ratio of subsid
Slide 23: Financial Strategy: Efficient Use of Capital
Financial Strategy Increase ROE by improving capital efficiency and seek further fulfillment of shareholder return policy Consolidated capital of TSI Holdings to seek Efficient Use of efficiency of payment operation Capital ->e.g. Cash Management Service etc. Efficient Use of Clearly demonstrate the
Slide 24: III. Reference Data
III. Reference Data 24 TSI HOLDINGS CO., LTD. All Rights Reserved.
Slide 25: Revenue Improvement Scheme -Net Sales-
Revenue Improvement Scheme -Net Sales- Strategy to Increase Net Sales [Net Sales] Full contribution of the stores opened in the H2 of 2015 Ending Feb. (89 stores), Overseas M&A Net sales of 2015 Ending Feb. of approx. +5 bn yen closed/replacement of stores in line 2018 Ending Feb. closing 11 brands
Slide 26: Domestic Comparable-Store Sales Rate
Domestic Comparable-Store Sales Rate Y/Y Q2ND 2015 Ending Feb. Q2ND 2016 Ending Feb. TOP10 : 106.7% TOP10 : 96.5% TSI ALL: 102.8% TSI ALL: 96.6% Month 2014 2015 Y/Y TOKYO STYLE : 100.9% TOKYO STYLE : 100.0% SANEI-INTERNATIONAL: 92.0% SANEI-INTERNATIONAL: 101.0% Month 2014 2015 26 TSI HOLDINGS CO., L
Slide 27: Net Sales Per Channel
Net Sales Per Channel (Unit: Million yen) Consolidated Cumulative Consolidated Cumulative Q2ND 2015 Ending Feb. Q2ND 2016 Ending Feb. Composition Composition Composition Rate Results Results Y/Y Rate Rate Y/Y Change Department Stores 23,178 26.8% 20,520 88.5% 24.6% -2.2pt Commercial Facilities(*1) 4
Slide 28: Store Distribution
Store Distribution Store Store Q2ND 2015 Ending Feb. Q1ST 2016 Ending Feb. Q2ND 2016 Ending Feb. Open Close # of Stores 1,765 1,623 88 349 1,362 Domestic Change -30 +53 -261 # of Stores 231 230 11 16 225 Overseas Change -22 +7 -5 # of Stores 1,996 1,853 99 365 1,587 Total Change -52 +60 -266 *Number
Slide 29: What is NPS?
What is NPS? NPS® is a simple and excellent indicator to measure customer loyalty “How likely is it you would recommend [brand] to a friend or colleague?” Extremely Not at all Likely likely 10 9 8 7 6 5 4 3 2 1 0 % － % = NPS （Promotors） （Detractors) *Net Promoter® and NPS® are registered trademarks
Slide 30: TSI HOLDINGS CO., LTD. All Rights Reserved.
The amounts given in this material are rounded down to the nearest million yen The forecast performance for TSI Holdings indicated in this material is based on the assessments/assumptions from the information available as of this material’s date. Actual performance may differ depending on variou