Slide 1: Six-month Period Ended Sept. 30, 2017 Financial Report
Six-month Period Ended Sept. 30, 2017 Financial Report Duskin Co., Ltd. November 15, 2017
Slide 2: Cautionary Statements
Cautionary Statements ■ These materials contain forward-looking statements concerning forecasts, goals, strategies, and other matters related to the Company, including its consolidated subsidiaries. ■ These forward-looking statements are based on projections and assumptions made by Duskin Group in l
Slide 3: Table of Contents
Table of Contents ■ Financial Summary Consolidated Financial Summary ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 6 Sales Summary ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 7 Operating Income Summary ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 9 Ordinary Income Summary ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 11 Net Income Summary ・・・・・・・・・
Slide 4: Table of Contents
Table of Contents ■ Returns to Shareholders Dividends ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 34 ■ Our Initiatives Long-term Strategy ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 36 Initiatives in First Half of FY2017 ・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 37 Home Service ・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・・ 38 Business S
Slide 5: Financial Summary
Six-month Period Ended Sept. 30, 2017 Financial Summary
Slide 6: Consolidated Financial Summary
Financial Summary Consolidated Financial Summary Consolidated Results (millions of yen) FY2016 1st Half FY2017 1st Half Reference Change ended ended FY2016 ended Sept. 30, 2016 Sept. 30, 2017 % Mar. 31, 2017 Sales 81,091 80,266 -824 -1.0 161,880 Operating Income 2,514 4,349 +1,835 +73.0 6,069 Operat
Slide 7: Sales Summary (1)
Financial Summary Sales Summary (1) Consolidated Sales Sales - 2nd half Sales - 1st half (millions of yen) 200,000 167,745 167,987 163,600 165,203 161,880 [Forecast] 150,000 84,434 84,355 82,673 83,333 80,789 [Forecast] 100,000 50,000 83,310 83,631 82,530 81,091 80,266 0 Mar. 2014 Mar. 2015 Mar. 201
Slide 8: Sales Summary (2)
Financial Summary Sales Summary (2) Consolidated Sales 80,266 million yen -824 million yen (-1.0%) FY2016 1st half FY2017 1st half Change (millions of yen) ended ended Sept. 30, 2016 Sept. 30, 2017 % Clean & Care Sales to outside customers 55,221 55,899 +677 +1.2 Group Inter-segment sales and transf
Slide 9: Operating Income Summary (1)
Financial Summary Operating Income Summary (1) Consolidated Operating Income Operating Margin 2nd half (millions of yen) 1st half 12,000 4.0% 4.3%[Forecast] 3.7% 3.3% 3.0% 7,000 8,000 [Forecast] 6,641 6,069 5,067 5,372 2,650 2,290 (3.2) (2.7) 3,555 [Forecast] 2,690 (4.4) 4,000 3,209 (3.3) (3.8) 4,35
Slide 10: Operating Income Summary (2)
Financial Summary Operating Income Summary (2) Consolidated Operating Income 4,349 million yen +1,835 million yen (+73.0%) Major factors Higher sales, lower investments in rental items, lower expenses for promotional Clean & Care Group : expenses and retirement benefits Food Group : Decreases in ret
Slide 11: Ordinary Income Summary (1)
Financial Summary Ordinary Income Summary (1) Consolidated Ordinary Income Ordinary Income Margin 2nd half (millions of yen) 1st half 12,000 5.0% 5.1% 4.7% [Forecast] 4.2% 4.1% 8,322 8,400 [Forecast] 7,083 7,554 8,000 6,707 3,155 2,994 (3.8) (3.5) [Forecast] 4,148 4,268 3,275 (5.1) (5.1) (4.0) 4,000
Slide 12: Ordinary Income Summary (2)
Financial Summary Ordinary Income Summary (2) Consolidated Ordinary Income 5,244 million yen +1,838 million yen (+54.0%) Major Factors 1) Operating income +1,800 million yen 2) Non-operating income +000 million yen ➢ Decrease in interest income -30 million yen ➢ Decrease in proceeds from miscellaneo
Slide 13: Net Income Summary (1)
Financial Summary Net Income Summary (1) Consolidated Net Income Net Income Margin 2nd half (millions of yen) 1st half 8,000 2.7% 2.7% 3.5% 2.0% [Forecast] 5,700 [Forecast] 6,000 1.8% 4,448 2,129 4,318 (2.6) 4,000 3,441 [Forecast] 1,389 2,983 (1.6) 2,212 1,971 1,020 (2.7) (2.3) (1.2) 3,570 2,000 3,0
Slide 14: Net Income Summary (2)
Financial Summary Net Income Summary (2) Consolidated Net Income 3,570 million yen +1,464 million yen (+69.6%) Major Factors 1) Ordinary income +1,800 million yen 2) Extraordinary income -000 million yen ➢ Decrease in gain on liquidation of -100 million yen investment securities ➢ Decrease in loss o
Slide 15: Consolidated Balance Sheet Summary
Financial Summary Consolidated Balance Sheet Summary Consolidated Balance Sheet (millions of yen) As of Mar. 31, As of Sept. 30, Change Major factors 2017 2017 Cash and deposits -2,000 Notes and accounts receivable -100 Current asset 62,021 62,760 +739 Securities +1,900 Deferred tax assets -200 Prop
Slide 16: Summary by Business Segment
DUSKIN BUODVREECS Summary by Business Segment
Slide 17: Highlights by Business Segment
Segment Information Highlights by Business Segment (millions of yen) FY2016 FY2016 1st half FY2017 1st half Change ended Sept. 30, 2016 ended Sept. 30, 2017 Operating Margin (%) Operating Margin (%) Operating Margin (%) (%) Sales 110,537 ― 55,221 ― 55,899 ― +677 +1.2 Clean & Care Group Operating Inc
Slide 18: Clean & Care Group (1)
Summary of Core Businesses (1) Clean & Care Group (1) Sales Operating Income 2nd half Operating Margin 1st half 2nd half (millions of yen) (millions of yen) 140,000 24,000 1st half 112,900 110,537 [Forecast] 120,000 20,000 12.4% 12.6% 100,000 14,200 [Forecast] 16,000 13,671 57,000 80,000 55,316 [For
Slide 19: Clean & Care Group (2) Residential Market
Summary of Core Businesses (1) Clean & Care Group (2) Change (millions of yen) FY2016 2Q FY2017 2Q % Sales Sales to outside customers 55,221 55,899 +677 +1.2 Inter-segment sales 408 379 -28 -7.0 Total 55,629 56,278 +649 +1.2 ● Sales of dust control products increased due to the contribution made by
Slide 20: Clean & Care Group (3) Commercial Market
Summary of Core Businesses (1) Clean & Care Group (3) Change (millions of yen) FY2016 2Q FY2017 2Q % Sales Sales to outside customers 55,221 55,899 +677 +1.2 Inter-segment sales 408 379 -28 -7.0 Total 55,629 56,278 +649 +1.2 ●Sales of dust control products declined slightly. ➢ Dust control products
Slide 21: Clean & Care Group (4)
Summary of Core Businesses (1) Clean & Care Group (4) (millions of yen) FY2016 2Q FY2017 2Q Change % Operating Income Operating income by segment 6,360 7,439 +1,078 +17.0 Improved cost ratio and lower expenses ➢ Increase in gross profit due to higher sales +300 million yen ➢ Increase in gross profit
Slide 22: Food Group (1)
Summary of Core Businesses (2) Food Group (1) Sales Operating Income Operating Margin 2nd half (millions of yen) (millions of yen) 2nd half 1st half 1st half 50,000 38,650 0.3%[Forecast] 40,151 [Forecast] 500 40,000 100 [Forecast] 200 211 （1.2） 30,000 19,866 20,314 [Forecast] -111 [Forecast] -100 （-
Slide 23: Food Group (2)
Summary of Core Businesses (2) Food Group (2) Change (millions of yen) FY2016 2Q FY2017 2Q % Sales Sales to outside customers 20,285 18,335 -1,949 -9.6 Inter-segment sales 5 5 -0 -1.9 Total 20,290 18,340 -1,949 -9.6 ● Mister Donut ➢ Total customer-level sales -7.5% (1Q: -9.2%, 2Q: -5.7%) ➢ Customer-
Slide 24: Food Group (3)
Summary of Core Businesses (2) Food Group (3) (millions of yen) FY2016 2Q FY2017 2Q Change % Operating Income － Operating income by segment -565 211 +777 Improved cost ratio and lower expenses ➢ Decrease in gross profit due to lower sales -700 million yen ➢ Increase in gross profit due to improved c
Slide 25: Other Businesses & Corporate
Summary of Core Businesses (3) Other Businesses & Corporate Change (millions of yen) FY2016 2Q FY2017 2Q % Other Businesses Sales to outside customers 5,584 6,032 +447 +8.0 Inter-segment sales 1,131 1,106 -24 -2.1 Total 6,715 7,138 +422 +6.3 Operating income 143 167 +24 +17.0 ●Overseas (consolidated
Slide 26: Other Businesses (Overseas Businesses)
Summary of Core Businesses (3) Other Businesses (Overseas Businesses) Overseas Businesses ➢ Customer-level sales Change Jan. – June 2016 Jan. – June 2017 % Taiwan 509 566 +57 +11.2％ (millions of NTD) Clean & Care Shanghai 10 11 +1 +10.2％ (millions of CNY) South Korea 555 474 -80 -14.5％ (millions of
Slide 27: Forecasts and Actual Results
Forecasts and Actual Results
Slide 28: FY2017 First Half Forecasts and Actual Results
Forecast & Actual FY2017 First Half Forecasts and Actual Results Consolidated *Change from forecast announced on May 15, 2017 (millions of yen) Sales Operating Income Ordinary Income Net Income Forecast (May15) 81,600 1,900 2,600 1,400 Actual 80,266 4,349 5,244 3,570 Difference (%) -1,333 (-1.6) +2,
Slide 29: FY2017 Forecasts
DUSKIN FY2017 Forecasts
Slide 30: FY2017 Forecasts (1)
Forecast FY2017 Forecasts (1) Revised forecast announced on Oct. 12, 2017 (millions of yen) Consolidated Sales Operating Income Ordinary Income Net Income FY2016 Actual 161,880 6,069 7,554 4,318 FY2017 Forecast 165,000 6,600 8,000 4,700 FY2017 Revised Forecast (Oct. 12) 163,600 7,000 8,400 5,700 FY2
Slide 31: FY2017 Forecasts (2)
Forecast FY2017 Forecasts (2) By Business Segment *Change from forecast announced on May 15, 2017 (millions of yen) Initial Forecast Revised Forecast Major Factors Operating Margin (%) Operating Margin (%) Sales 112,700 ― Dust Control +200 112,900 ― Clean & Care Group Operating Cost for Style Cleane
Slide 32: FY2017 Forecasts (3)
Forecast FY2017 Forecasts (3) By Business Segment - 2nd Half *Comparison with the same period of the previous year (millions of yen) FY2017 FY2016- 2nd Half FY2017 -2nd Half Actual Forecast Change Revised Forecast (Full-year Forecast - 1st Half Actual) Operating Margin (%) Operating Margin (%) Opera
Slide 33: Returns to Shareholders
DUSKIN BUODVREECS Returns to Shareholders
Slide 34: Dividends
Returns to shareholders Returns to shareholders Dividends Steady and continuous dividend distribution in line with basic policy (Full-year total: 40 yen per share) Dividends per share (Actual & Forecasts) (yen) FY2015 FY2016 FY2017 (Forecast) End of 2nd Quarter 20 20 20 Year-end 20 20 20 Total (annu
Slide 35: Our Initiatives
DUSKIN BUODVREECS Our Initiatives
Slide 36: Long-term Strategy
Long-term Strategy A one and only franchise system where franchisor and franchisees share our Management Philosophy The most trusted franchise business in the community All business units and services join to respond to the needs of our customers 36
Slide 37: Initiatives in First Half of FY2017
Initiatives in First Half of FY2017 [Theme] Business Model Reform ● Diversified customer contact points ➡ DDuet membership: 440,000 (+100,000)* ● Comprehensive service proposals Home Service ➡ No. of tablets introduced to sales representatives: 3,500 (+700)* ● Improved marketing capabilities by cent
Slide 38: Home Service
Home Service Establish a business model for comprehensive home support service with enhanced customer contact ➤ Promote the DDuet membership website → Contact point for non face-to-face customers ➤ Tablets for sales representatives → Responding to the various needs of customers ➤ Centralize customer
Slide 39: Business Service
Business Service Structure/system to provide comprehensive hygiene management Hygiene management ➤ Increase no. of Hygiene Masters, experts in hygiene control ➤ Responding to the needs in hygiene management in comply with HACCP set by each local authorities No. of Hygiene Masters registered As of Se
Slide 40: Focus on Technical Service Category
Focus on Technical Service Category ■Customer-level Sales (millions of yen) New business Change from 2Q Actual FY2016 2Q ServiceMaster 14,300 2.6% Merry Maids 5,200 3.2% Terminix 4,400 2.8% Total Green 1,400 5.0% Home Repair 20 42.2% Total 25,300 2.9% 40
Slide 41: Housekeeping Service
Housekeeping Service ➤ The Project to Accept Foreigners Conducting Housekeeping Services in the National Strategic Special Zones Work places Osaka: 4 (Date of employment: April 16, 2017) (3-year limited term Kanagawa: 4 (Date of employment: April 16, 2017) employment） Tokyo: 4 (Date of employment: O
Slide 42: Life Care Service
Life Care Service Expand the services for seniors 1. Seniors in good 2. Seniors in need of 3. Seniors in need of health assistance care Test marketing at Wako Iki-iki Life Service Plaza Merry Maids Home Instead (Housekeeping/private pay) (Caregiving/private pay) 758 units 107 units Cross sectional H
Slide 43: Mister Donut
Mister Donut DUSKIN | Mister Donut | Something good’s gonna happen. mister Donut 43
Slide 44: Initiatives for "Something good's gonna happen."
Mister Donut -Product Development Strategy- Initiatives for “Something good’s gonna happen.” Price changes of the popular items 44
Slide 45: Mister Donut - MISDO GOHAN
Mister Donut -MISDO GOHAN- Creating a culture to enjoy meals at Mister Donut 45
Slide 46: Mister Donut - MISDO GOHAN Phase 1
Mister Donut -MISDO GOHAN Phase 1- [Phase 1] Released on Friday, November 17 Savory Sandwich – Donut with Hot Toast topped with: Egg & Mayonnaise Ham & Egg Two other fillings : Cheese & Tuna Hot Savory Pie Shrimp Bisque Hot Sweet Pie: Apple & Custard Three other pies : Apple & Cheese 46
Slide 47: Mister Donut - MISDO GOHAN Phase 2
Mister Donut -MISDO GOHAN Phase 2- [Phase 2] To be released in February 2018 Pasta Hot dogs Sandwiches Muffins 47
Slide 48: MISDO GOHAN - New ovens introduced to all shops
Mister Donut -MISDO GOHAN- New ovens introduced to all the shops and leased at free of cost It enables us to serve the MISDO GOHAN items hot and crispy. 48
Slide 49: Mister Donut - Introducing Pizza Items
Mister Donut -Introducing Pizza Items- Partnership with STRAWBERRY CONES Co., LTD. 49
Slide 50: Mister Donut - Renovation & New Shop Opening
Mister Donut -Renovation & New Shop Opening- Initiatives for “Something good’s gonna happen.” Renovation & new shop opening 50
Slide 51: Initiatives for "Something good's gonna happen."
Mister Donut -Renovation & New Shop Opening- Initiatives for “Something good’s gonna happen.” Renovating the existing shops Shop development in the untapped markets V/21 V/21 Mister Donut Mister Donut take-out Café to go Master shop Satellite shop Satellite shop Satellite shop Satellite shop Comfort
Slide 52: Other Food Businesses (1)
Other Food Businesses (1) ▶ Katsu & Katsu Introducing a new restaurant model with 15% less initial investment ▶ Pie Face The 4th shop, Eki Marché Osaka opened on August 30. 52
Slide 53: Other Food Businesses (2)
Other Food Businesses (2) ▶ Bakery Factory The company-owned manufacturing factory was sold and manufacturing is outsourced. ▶ The Chiffon & Spoon Rolled out new seasonal items serially ▶ Others Ice De Lion products are also offered at Mister Donut. 53
Slide 54: Reference
DUSKIN BUODVREECS Reference
Slide 55: Financial Summary - Non-consolidated Results
Reference 1 Financial Summary - Non-consolidated Results Non-consolidated (millions of yen) FY2016 1st Half FY2017 1st Half Change Reference ended ended FY 2016 ended Sept. 30, 2016 Sept. 30, 2017 % Mar. 31, 2017 Sales 67,051 65,889 -1,161 -1.7 134,245 Operating Income 1,274 2,974 +1,700 +133.4 4,06
Slide 56: Business Summary by Segment
Reference 2 Business Summary by Segment Clean & Care Group Direct Selling Home Service (Residential Market) Business Service (Commercial Market) Rental service through periodic visits Rental service through periodic visits Dust Control ・・・ Mops and mats Dust Control ・・・ Mops and mats Air Clean ・・・ A
Slide 57: Customer-Level Sales (CLS)
Reference 3 Customer-Level Sales (CLS) CLS by Business *Sales of overseas businesses indicated here are the total sales from January to June. (millions of yen) Increase/Decrease FY2016 2Q FY2017 2Q Change % Clean & Care Group 136,562 136,357 -204 -0.1% Dust Control (Domestic) Home Service (Residenti
Slide 58: Recycle-Oriented Business Model at Dust Control Business
Reference 4 Recycle-Oriented Business Model at Dust Control Business Based on the idea to fully recycle the products through Rental of mops and mats repeated use until the end of their useable life Franchisees pay deposit. Rental (Delivery=Rental) (Franchisees record the sales.) Production & Logisti