Autobacs Seven Co., Ltd. · TSE:9832
Autobacs Seven — H1 FY March 2016 Earnings Presentation
56 slides from Autobacs Seven's earnings presentation, Nov 2, 2015
Slide 1: Results for the Six Months Ended September 30, 2015
【Reference】 Translation ANALYST MEETING Results for the Six Months Ended September 30, 2015 November 2, 2015 AUTOBACS SEVEN CO., LTD.
Slide 2: Part 1: Message from CEO
Part 1: Message from CEO Representative Director & CEO Setsuo Wakuda 2
Slide 3: Introduction
Introduction Domestic business environment ・The market for automotive goods and services is on a slight declining trend, while the markets for statutory safety inspections and used cars are stable ・Intensifying competition in markets that cross over traditional business boundaries ・Customers need sa
Slide 4: Revised 2014 Medium-Term Business Plan
Revised 2014 Medium-Term Business Plan Improving Profitability of AUTOBACS Business and Creating New Business for Growth Basic 1. Transforming the AUTOBACS Business into a Policy business that responds to change 2. Building a new pillar to generate revenue 3. Adopting organizational reforms to creat
Slide 5: Outline of Business Strategy
Outline of Business Strategy Status Policy Focus as the Group’s 〔Basic policy〕 top priority business “Creating Higher Value for Customers and Domestic Transform into a Establishing Competitive Advantage” AUTOBACS more highly Business profitable business Building a continuous relationship with custom
Slide 6: Part 2: Results of First Half and Forecast of Full Year
Part 2: Results of First Half and Forecast of Full Year 1．Results of the First Six Months Ended September 30, 2015 2．Revision of Forecast of FY March 2016 and Measures for the Second Half of FY March 2016 Director and Vice Chief Executive Officer, Head of Corporate Administration Hironori Morimoto 6
Slide 7: Results for the First Six Months Ended September 30, 2015
１．Results for the First Six Months Ended September 30, 2015 7
Slide 8: Financial Results (the First Half of FY March 2016)
Financial Results (the First Half of FY March 2016) (Billion Yen) Six months ended September 30, 2015 Six months ended Actual YoY change Change from September 30, Initial Forecast results ratio forecast 2014 Net sales 102.8 98.6 +0.7% -4.1 98.0 Gross margin 32.5 32.1 -5.0% -0.3 30.5 Gross margin rat
Slide 9: Review of the First Half of FY March 2016
Review of the First Half of FY March 2016 1．Slump in demand for automotive goods and services as a result of sluggish new car sales, despite rebound from sales decline after consumption tax hike 2．Increase in sales of statutory safety inspection services, automobile purchases and sales 3．Improved pr
Slide 10: Segment Information
Segment Information (Million Yen) Six months Six months YoY Initial % to Plan ended Sep 30, ended Sep 30, Change Forecast 2015 2014 Net sales 75,144 78,662 -4.5% 80,000 -6.1% Non-consolidated Operating income 3,515 2,990 +17.6% 4,000 -12.1% Net sales 32,315 30,501 +5.9% 32,600 -0.9% Domestic store s
Slide 11: Segment Analysis for Operating Income
Analysis for Operating Income Domestic Retail sales Total store basis: +2.0% Same store basis: +1.2% Operating income (Billion yen) Amount Major drivers of variance (yoy) Non-consolidated 3.51 +0.52BY Net sales -3.51BY (-4.5%) Gross Profit -0.22 (21.0% (last year 20.3%)) ・GPM increase from strong sa
Slide 12: Performance by Overseas Subsidiaries
Performance by Overseas Subsidiaries FRANCE THAILAND SINGAPORE CHINA MALAYSIA Number of stores at Sep. 30, 2015 11 6 3 0 3 -including FC stores- 1st Half 1st Half 1st Half 1st Half 1st Half 1st Half 1st Half 1st Half 1st Half 1st Half FY FY FY FY FY FY FY FY FY FY Period March March March March Marc
Slide 13: Domestic Retail Sales
Domestic Retail Sales Retail sales including FCs*: 122.3 billion Yen (+ 2.0% YoY) (Billion Yen) 150 Fuel & second-hand goods: 122.3 2.1 billion Yen (-9.1% YoY） 119.8 2.3 2.1 Statutory safety inspection : 7.8 8.5 8.5 billion Yen (+9.2% YoY) 10.4 12.6 100 295 thousand cars (+10.7% YoY) Number of fully
Slide 14: Sales Trend: Retail, Wholesale and Store Inventory
Sales Trend: Retail, Wholesale and Store Inventory 【YoY change for the last 12 months】 （%） last-minute demand before 20.0 consumption tax hike Retail Wholesale 13.5 10.0 Return after the tax hike related demand drop in last year 1.4 -0.3 -2.5 5.0 0.0 -5.0 -7.1 -1.0 -1.0 -3.9 -1.6 -7.7 -4.0 -8.2 -7.1
Slide 15: Sales Ups & Downs by Merchandise (1st Half)
Sales Ups & Downs by Merchandise (1st Half) 【Same Store Basis】 Sales: + 1.2% YoY, Number of customers: -3.0% YoY Retail sales ups and downs by merchandise category (First half of March 2016, YoY change in amount, total store basis) (Million Yen) 1,500 NB tires : +1,370MY PB & Exclusive brand tires：
Slide 16: Automobile purchase and sales (1)
Automobile purchase and sales (1) Commercial flow of car purchase and B2B sales (No. of cars denotes cumulative units for the six months ended Sep. 30, 2015) FC Headquarters Sales by auction Appraisal and purchase consigned to FC Headquarters Used car dealers 929 cars Auto auctions 5,588 cars Custom
Slide 17: Automobile purchase and sales (2)
Automobile purchase and sales (2) Commercial flow of retail sales (No. of cars denotes cumulative units for the six months ended Sep. 30, 2015) New car dealers New car dealers Used car dealers Auto auctions Auto auctions Procurement Procurement FC Headquarters Customers Purchase & Wholesale Inventor
Slide 18: Forecast of FY March 2016 and Measures for the Second Half
２．Forecast of FY March 2016 and Measures for the Second Half of FY March 2016 18
Slide 19: Expectations for the business environment in the 2nd Half
Expectations for the business environment in the 2nd Half Business Environment ・Sales of new models of popular automobiles ・Sales of leisure related goods, such as car video camera and roof boxes, expected to be increased ・Rising trend in the number of drivers who install winter tires YoY Sales at D
Slide 20: Revised Forecast of FY March 2016
Revised Forecast of FY March 2016 No revision to forecast for consolidated full-year operating income. No revision to the sales and gross profit forecasts for the second half set at the beginning of the fiscal year. A portion of SG&A expenses not digested in the first half carried over to the second
Slide 21: CAPEX & Depreciation
CAPEX & Depreciation CAPEX Depreciation (Billion Yen) (Billion Yen) 9 6 8 7.66 5 7 4.30 6 4 5 3 4 7.69 4.92 6.24 4.54 4.42 4.57 3 6.12 2 4.81 2 3.60 1 1.88 1 0 0 2012/3 2013/3 2014/3 2015/3 2016/3 (E) 2012/3 2013/3 2014/3 2015/3 2016/3 (E) Amounts are rounded down. 21
Slide 22: Shareholders Return
Shareholders Return Dividend of profit: Unchanged according to the policy (DOE of 3% or more) Share buyback: Completed buyback announced in May Dividends per share Dividends and share buyback (Yen) (Billion Yen) 80 12 10.34 10.24 10.29 10 60 10 １０ 8 4.59 5.05 5.24 30 30 40 27 6 4 20 5.76 30 30 5.19
Slide 23: Part 3: Measures in First and Second Half
Part 3: 1 ．Measures implemented in the First Half 2 ．Measures that will be implemented in the Second Half Director and Vice Chief Executive Officer, Chief AUTOBACS Chain Officer Kiomi Kobayashi 23
Slide 24: Measures implemented in the First Half
1 ．Measures implemented in the First Half 24
Slide 25: Measures implemented in the First Half
Measures implemented in the First Half Car parts and accessories ・ Expansion line-up of the private brand “AQ.” Introduction category ： Engine oil, winter tire, coolant liquid, etc. ・Sales expansion of car video camera Amount (YoY): +114.0% (cumulative through Q2 for the fiscal year ending March 201
Slide 26: AQ. (AUTOBACS QUALITY.) Private Brand
Expanding AUTOBACS Private Bland “AQ. （AUTOBACS QUALITY.）” Battery Launched in Oct. 2014 Disinfection/Deodorization Car wash goods Launched in March 2015 Launched in April 2015 Interiors and car wash goods Launched in July 2015 Engine oil Launched in June 2015 Rear view camera Launched in Oct. 2015
Slide 27: Oil change / Statutory safety inspections appointments
Oil change / Statutory safety inspections: Initiatives implemented for appointments made via website/telephone ■ Results of Oil change appointments made via website / telephone. (in the first half) The number of Oil change for appointments Approximately 101,000 （number） made via website / telephone
Slide 28: E-commerce
E-commerce The impact of efforts made to attract customers to stores is making headway: increase in purchases on the Internet ⇒ pickup/installation in stores ■Net sales for 1st Half :1.4 billion yen (up 142.4% YoY) Store sales: 0.82 billion yen(up 139.2% YoY) Direct delivery to customers: 0.58 billi
Slide 29: Measures that will be implemented in the Second Half
2 ．Measures that will be implemented in the Second Half 29
Slide 30: Policy and Targets of AUTOBACS Business
AUTOBACS Business Policy and Targets Creating Higher Value for Customers and Business Establishing Competitive Advantage Policy “Building Continuous Relationship with Customers, and Providing Convenience and Trust by Strengthening Ties with Them” Numerical Targets of the Domestic AUTOBACS Business ・
Slide 31: Policy of Domestic AUTOBACS Business
Policy of Domestic AUTOBACS Business Competitive advantage of AUTOBACS “Customers can use our services comfortably without stress” ～customers feel they are served “with great understandings,” “with trust,” “with shorter waiting times,” “at all times,” and “with suitable substitutes”～ Building contin
Slide 32: Increase maintenance memberships
Specific Strategy for the AUTOBACS Business Increase maintenance memberships Increase customers for tires Increase Increase Increase maintenance customers for customers for memberships oil statutory safety Increase automobile inspection purchase from customers Target: 3 million maintenance members *
Slide 33: Increase customers for oil
Specific Strategy for the AUTOBACS Business Increase customers for oil Increase customers for tires Increase Increase Increase maintenance customers for customers for memberships oil statutory safety Increase automobile inspection purchase from customers Major initiatives to be implemented in the se
Slide 34: Increase customers for statutory safety inspection
Specific Strategy for the AUTOBACS Business Increase customers for statutory Increase customers for tires safety inspection Increase Increase Increase customers for maintenance customers for memberships oil statutory safety Increase automobile inspection purchase from customers Targets: 800,000 vehi
Slide 35: Increase customers for tires
Specific Strategy for the AUTOBACS Business Increase customers for tires Increase customers for tires Increase Increase Increase maintenance customers for customers for memberships oil statutory safety Increase automobile inspection purchase from customers Target: Sales of 7.3 million tires (FY Marc
Slide 36: Increase automobile purchase from customers
Specific Strategy for the AUTOBACS Business Increase automobile purchase from customers Increase customers for tires Increase Increase Increase maintenance customers for customers for memberships oil statutory safety Increase automobile inspection purchase from customers Automobile purchase and sale
Slide 37: Items and Initiatives of Mid-term Business Plan: Domestic AUTOBACS
Items and Initiatives of Mid-term Business Plan Initiatives of Domestic AUTOBACS Business Items Initiatives Maintenance ・Reviewing membership benefits, strengthen activities to membership holders attract more members, etc. ・Increasing maintenance members to three million from two million at the end
Slide 38: Initiatives: Domestic Store Subsidiaries
Items and Initiatives of Mid-term Business Plan Domestic Store Subsidiaries：Initiatives aimed at improved profitability Steadily implement initiatives toward improving operating income and the rate of inventory efficiency by sharing specific numerical targets and challenges with the president of eac
Slide 39: Initiatives: Overseas Business
Items and Initiatives of Mid-term Business Plan Overseas Business：Promote business expansion centered on ASEAN Improve profitability of existing stores and promote opening of small-scale stores centered on maintenance goods Items Initiatives Areas with ・ Reduction of fixed costs and relocation at un
Slide 40: New Business: Begin BMW/MINI dealer operations
Items and Initiatives of Mid-term Business Plan New Business ：Begin BMW/MINI dealer operations Sales volume for both BMW and MINI up since operations began (at least 50% higher year on year) Items Initiatives Name of companies Autoplatz K.K., Autoplatz Moters K.K. acquired: Name of stores Ikebukuro
Slide 41: New Store Openings / Domestic
New Store Openings / Domestic Store openings from April to October, 2015 Location Owner of Building with furniture Store name Opening date (Prefecture) store and equipment 1 AUTOBACS TAKEO Store Saga Subsidiary Apr 16, 2015 2 AUTOBACS OGAWARA Miyagi Subsidiary Jun 11, 2015 3 AUTOBACS KURE AGA CHUOU
Slide 42: Today's Message
Today’s Message • Profitability achieved in the first half despite sales not achieving plan as a result of efforts made on statutory safety inspection services as well as car purchases and sales; improved gross profit margin; and controlled SG&A costs, although demand for automotive goods and servic
Slide 43: APPENDIX
APPENDIX 43
Slide 44: Quarterly P/L (1st Half of FY March 2016)
Quarterly P/L (1st Half of FY March 2016) (Million Yen) 1st Quarter of FY 2016 2nd Quarter of FY 2016 1st Half of FY 2016 Result YoY Result YoY Result YoY Net sales 49,095 +1.3% 49,599 +0.1% 98,695 +0.7% Gross margin 15,703 +5.9% 16,404 +4.2% 32,107 +5.0% % of Sales 32.0% － 33.1% － 32.5% － SG&A 14,7
Slide 45: Consolidation Adjustments
Consolidation Adjustments Consolidation Adjustments (Million Yen) Six months ended Six months ended September 30, 2015 September 30, 2014 Operating Income for segment total 2,596 800 Elimination of Intersegment transaction (Income of subsidiaries for supporting (355) (215) functions, etc.) Inventori
Slide 46: ASP Trends in Car Navigation Devices
ASP Trends in Car Navigation Devices ASP and Unit Sales Trends of Car Navigation Devices (YoY) 20.0% Unit sales (YoY) ASP (YoY) 10.8% 8.7% 10.0% 5.3% 4.0% 4.4% 2.8% 0.7% 0.1% -0.3% 0.0% -5.9% -9.2% -9.4% -10.0% -11.3% -10.3% -10.9% -20.0% -15.3% -17.1% -20.1% -20.6% -21.1% -23.0% -22.5% -30.0% -25.9
Slide 47: Analysis of Income statements (1st Half of FY 2016)
Analysis of Income statements (1st Half of FY 2016) Parental company (Non-consolidated) -3.83BY ↑ Services Net sales Wholesale -5.2% ↓ Car electronics, car interior, tires and wheels, etc. 75.1BY YoY: -3.51BY +0.45BY ↑ Car sales, services, e-commerce, car electronics Retail +19.1% ↓ Car interiors, f
Slide 48: Balance Sheet: Assets
Balance Sheet: Assets Total Assets 186.5 BY 178.5 BY (Billion Yen) 42.7 Cash and Major items changed deposits 35.1 18.6 Trade notes & 20.7 Decreased by share buy back account receivables and dividends 16.7 Inventories 17.7 19.7 Accounts 15.0 dues 15.4 Other 15.9 1 current assets Increased due to new
Slide 49: Balance Sheets: Liabilities and Equity
Balance Sheets: Liabilities and Equity Total Liabilities & Equity 186.5BY 178.5BY (Billion Yen) Accounts payables 12.8 Short-term 2.9 borrowings 14.4 Major items changed 18.7 2.2 2.1 Other short-term 16.1 11.2 liabilities 2.9 Long-tem 11.1 borrowings Other long-term liabilities Retained earnings: -5
Slide 50: About the maintenance membership system
<Reference>About the maintenance membership system Annual membership fee: 1,080 yen (including tax) Renewal fee: 540 yen (including tax) Points offered: 1 point for every 100 yen of purchase Special benefit: The eight labor charges stated below as part of the maintenance items will be free of charge
Slide 51: About Quick Statutory Inspection
<Reference> About “Quick Statutory Inspection” ■The difference between the traditional full-maintenance statutory inspection and quick statutory inspection “ Full-maintenance statutory Maintenance “Quick statutory inspection” inspections” at a later date Time spent on car inspection Time spent on ca
Slide 52: About the tire storage service
<Reference>About the tire storage service ■Allay customer concerns about where tires are stored and lead this to securing customers as well as selling tires [Purpose/Objective] (1) By storing tires for customers, promote customers to return to stores when changing tires and lead this to securing cus
Slide 53: New Store Openings / Overseas
New Store Openings / Overseas Thailand Malaysia AUTOBACS NAWAMIN Store AUTOBACS PERLING Store Opening date：April 9, 2015. Opening date： May 19, 2015. Indonesia Malaysia Thailand AUTOBACS A.R.Hakim Store AUTOBACS SERI-ORKID Store AUTOBACS PHARAMA 3 Store Opening date： July 8, 2015 Opening date： Octob
Slide 54: Store Openings and Closings (Plan)
Store Openings and Closings (Plan) < Domestic stores > Fiscal year ending March 31, 2016 (Plan) No. of No. of No. of stores as 1st Half (result) stores as of 2nd Half (Plan) stores as of March September of March 31, 2015 New S/B・R/L Close 30, 2015 New S/B・R/L Close 31, 2016 AUTOBACS 491 +7 +4/-4 -1
Slide 55: Performance Results of Franchisees
Performance Results of Franchisees Ordinary Income of Franchise Companies (Preliminary) (Billion Yen) 2.0 0.29 0.0 -2.0 -1.88 -2.74 -2.72 -4.0 Total of profit-making FCs Total of profit-making subsidiaries -6.0 Total of loss-making FCs -5.89 Total of loss-making subsidiaries Orginary income(net) -8.
Slide 56: Forward-Looking Statements
Forward-Looking Statements These materials include forecasts regarding the Company’s future plans, strategies, and performance. This information is based on judgments and estimates made in accordance with information currently available. Actual results may differ materially from forecasts due to suc
Autobacs Seven — H1 FY March 2016 Earnings Presentation on 6ix