KOSAIDO Holdings Co.Ltd. · TSE:7868
KOSAIDO Holdings Co.Ltd — Q2 FY03/23 Earnings Presentation
46 slides from KOSAIDO Holdings Co.Ltd's earnings presentation, Nov 9, 2022
Slide 1: Q2 FY03/23 Financial Results Presentation
Q2 FY03/23 Financial Results Presentation Securities code: 7868 2022/11/9
Slide 2: Contents
0 Contents 1 Q2 FY03/23 Highlights P. 2 ・Quarterly Performance ・Analysis of Change in Operating Profit ・Segment Performance ・Shareholder Returns ・Major Activities in Q2 2 Initiatives in FY03/23 P. 22 ・1st year Plan/Status of Medium-Term Business Plan 2.0 ・Consolidated Financial Forecast ・Promotion o
Slide 3: Q2 FY03/23 Highlights
１ Q2 FY03/23 Highlights 2
Slide 4: Steady execution of plans and preparation for further growth
1-01 Q2 FY03/23 Performance Highlights • Q2 Consolidated results: Net sales and operating profit both increased from the same period last year. (Net sales +10.7% YoY, Operating profit +67.6% YoY) • Resumption of dividend / Decision on interim dividend for FY03/23 • Initiatives for medium-to long-ter
Slide 5: Q2 FY03/23 Consolidated Financial Results
1-02 Q2 FY03/23 Consolidated Financial Results • Funeral Services: Continued YoY increase in the number of cremation services handled and number of visitors. • Information: Sales increased driven by BPO projects for local governments and public offices. • HR: Sales increased mainly in the owned medi
Slide 6: Q2 FY03/23 Progress Rate of Consolidated Financial Status
1-03 Q2 FY03/23 Progress Rate of Consolidated Financial Status • Progress rate in Q2 against full-year forecast is strong compared with FY22 (Millions of yen) FY03/23 Q2 FY03/22 Q2 FY03/23 FY03/22 Full-year Results Progress Results Progress Compare Full-year forcast [Cumulative Rate [Cumulative Rate
Slide 7: Quarterly Trend (Net Sales)
1-04 Quarterly Trend (Net Sales) • Net sales increased 14.2% YoY due to strong sales of cremation charges due to an increase in the number of transactions in the Funeral Services segment and BPO business in the Information segment. (Millions of yen) 14,000 12,000 11,470 9,710 2,265 10,000 8,996 8,65
Slide 8: Quarterly Trend (Cost of Sales)
1-05 Quarterly Trend (Cost of Sales) • Cost of sales increased from the same period last year (+414 million yen, - 4.3pt cost of sales ratio) • Despite an increase in cost of sales due to steady performance of BPO business, the cost of sales ratio decreased from the same period last year. (Millions
Slide 9: Quarterly Trend (SG&A Expenses)
1-05 Quarterly Trend (SG&A Expenses) • SG&A expenses increased from the same period last year (+317 million yen, +0.8pt SG&A expenses ratio) • Personnel expenses and advertising expenses as an investment for future growth increased (Millions of yen / %: SG&A expense ratio) 2,500 2,086 （24.1%） 1,952
Slide 10: Quarterly Trend (Number of Employees)
1-06 Quarterly Trend (Number of Employees) • Strengthen human resources in anticipation of medium- to long-term growth in the Funeral Services segment. (Number of employees / %: Composition ratio) * Number inside parentheses “( )” indicate YoY change Sep. 2020 ★ Closed Toyonaka Plant 1,400 1,252 1,2
Slide 11: Quarterly Trend (Operating Profit by Segment)
1-07 Quarterly Trend (Operating Profit by Segment) • Operating profit increased 88.1% from the period last year due to the significant contribution of growth in the funeral home business in the Funeral segment and the maintenance of the operating rate of the printing factory in the Information segme
Slide 12: Q2 FY03/23: Analysis of Change in Operating Profit (Major Items)
1-09 Q2 FY03/23: Analysis of Change in Operating Profit (Major Items) • Increase of sales in all business segments contributed, overall profit increased, despite overall costs increased due to labor costs and personnel costs increased due to new businesses and personnel system expansion. +218 (Milli
Slide 13: Q2 FY03/23 Financial Results Summary by Business Segment
1-09 Q2 FY03/23 Financial Results Summary by Business Segment (Millions of yen) Net sales YoY change Operating profit YoY change Q2 FY03/23 Q2 FY03/23 [Cumulative Q1 FY03/22 Amount % [Cumulative Q1 FY03/22 Among % total] total] Funeral Services 5,170 4,261 909 21.3 1,590 1,232 358 29.1 ー Information
Slide 14: Q2 FY03/23 Funeral Services Segment (YoY)
1-11 Q2 FY03/23 Funeral Services Segment (YoY) (Millions of yen) Net Sales YoY change Operating profit YoY change Q2 FY03/23 Q2 FY03/23 Q2 FY03/22 Q2 FY03/23 (Cumulative Amount (Cumulative Amount (Cumulative) % (Cumulative) % total) total) Funeral Services 5,170 4,261 909 21.3 1,590 1,232 358 29.1 O
Slide 15: Q2 FY03/23 Information Segment (YoY)
1-12 Q2 FY03/23 Information Segment (YoY) (Millions of yen) Net sales YoY change Operating profit YoY change Q2 FY03/23 Q2 FY03/22 Q2 FY03/23 Q2 FY03/23 (Cumulative (Cumulative Amount % (Cumulative (Cumulative Amount % total) total) total) total) ー Information 8,096 7,989 107 1.3 18 - 302 320 turn p
Slide 16: Q2 FY03/23 HR Segment (YoY)
1-13 Q2 FY03/23 HR Segment (YoY) (Millions of yen) Net sales YoY change Operating profit YoY change Q2 FY03/23 Q2 FY03/23 (Cumulative Q2 FY03/22 Amount % (Cumulative Q2 FY03/22 Amount % total) total) HR 3,221 2,644 577 21.8 22 72 -50 -69.4 Operating environment • Recruitment demand is recovering, pa
Slide 17: Consolidated Balance Sheet
1-14 Consolidated Balance Sheet (Millions of yen) As of March 31, 2022 As of September 30, 2022 Difference Current assets 31,350 24,996 - 6,354 Cash and deposits 21,662 18,337 - 3,325 Notes and accounts receivable– 7,131 3,900 - 3,231 trade Non-current assets 42,380 41,993 - 387 Property, plant and
Slide 18: Shareholders return
1-15 Shareholders return Interim dividend for FY03/23 ✓ Decided to distribute surplus dividends (interim dividends) based on September 30, 2022 Dividend per share｜JPY7.75 Total dividend｜221 million yen Dividend forecast for FY03/23 ✓ Year-end dividend as originally forecast (dividend payout ratio of
Slide 19: Major initiatives in Q2 FY03/23
1-16 Major initiatives in Q2 FY03/23 1. Profit increase through new funeral business and continued structural reform of information segment 2. Significant improvement in financial indicators due to improved performance 3. Steady progress in preparations for further new businesses Copyright 2022 KOSA
Slide 20: Profit increase through new funeral business and structural reform of information segment
Profit increase through new funeral business and continued structural 1-16-1 reform of information segment Funeral Services segment Information segment ・Efficient operation of cremation furnaces ・Promoting in-house production of printing plants ・Upselling by accepting non-encoffined items ・Shift per
Slide 21: Trends in quarterly interest-bearing debt balance
Significant improvement in financial indicators due to improved 1-16-2 performance Trends in quarterly interest-bearing debt balance • Interest-bearing debt balance for Q2 FY03/23 is -6,573 million yen compared to the end of the previous fiscal year. • Strengthen the foundation for active investment
Slide 22: Steady progress in preparations for further new businesses
1-16-3 Steady progress in preparations for further new businesses Initiatives based on medium- to long-term business plans in the senior and end of life businesses Financial and legal 炉メーカー Partnership with services for visitors 提携 Furnace Manufacturer Prepare Prepare Peace of mind support business
Slide 23: Initiatives in FY03/23
２ Initiatives in FY03/23 22
Slide 24: 1st year Plan/Status of Medium-Term Business Plan 2.0: Funeral halls expansion
Initiatives in FY03/23 2-01 1st year Plan/Status of Medium-Term Business Plan 2.0 Funeral halls expansion Remodeled waiting room and rest room into funeral halls. Currently, increase the number of funeral halls with high demand, Improving convenience for users and productivity of the entire funeral
Slide 25: 1st year Plan/Status of Medium-Term Business Plan 2.0
Initiatives in FY03/23 2-02 1st year Plan/Status of Medium-Term Business Plan 2.0 Status of two funeral planning services companies Q2 continued to be strong from Q1 (Millions of yen) Net Sales Operating Profit * GRAN CEREMO TOKYO started operation from July 2022. ・Information Segment ✓ Completion o
Slide 26: FY03/23 Financial Forecast
2-03 FY03/23 Financial Forecast (Millions of yen) FY03/23 YoY change Full-Year FY03/22 Forecast Amount % Net sales 37,800 35,361 +2,439 6.9 Operating profit 3,800 3,729 +71 1.9 Ordinary profit 3,700 3,610 +90 2.5 Profit before income taxes 3,690 3,627 +63 1.7 Income taxes 740 17 +723 4,252.9 Profit
Slide 27: Information disclosure based on TCFD recommendations
Promotion of Sustainability 2-04 Information disclosure based on TCFD recommendations Governance Strategy Board of Directors Basic scenarios for impact assessment Management Meeting Prevention of air, water and soil pollution Shift to a decarbonized society and the shift to reusing resources Sustain
Slide 28: TCFD Metrics and Targets
Promotion of Sustainability 2-05 Information disclosure based on TCFD recommendations Metrics and Targets Scope 3 emissions (FY2020) Metrics: We monitored eight categories related to the Group’s business activities GHG Protocol Scope 1, Scope 2, and Scope 3 emissions, measured with reference to the
Slide 29: Medium-Term Business Plan 2.0 (FY2022-FY2024)
Reference Medium-Term 3 Business Plan 2.0 (FY2022-FY2024) 28
Slide 30: Basic Policy
3-01 Medium-Term Business Plan 2.00 Basic Policy 1. Enter the funeral planning services business. 2. Metamorphose into an “ultra-aging society” stock. 3. Reinstate dividends and enhance shareholder returns. Copyright 2022 KOSAIDO Holdings Co., Ltd. All Rights Reserved. 29
Slide 31: Medium-Term Business Plan 2.0 Performance Plan (Consolidated)
3-02 Medium-Term Business Plan 2.0｜Performance Plan (Consolidated) (Millions of yen) FY03/20 FY03/21 FY03/22 FY03/23 FY03/24 FY03/25 Actual Actual Actual Plan Plan Plan Net sales 35,088 31,497 35,361 37,800 40,600 44,400 Operating profit 2,328 2,017 3,729 3,800 4,700 6,200 Ordinary profit 2,210 1,82
Slide 32: Funeral Services Segment Business Environment & Market Trends
3-03 Funeral Services Segment｜Business Environment & Market Trends ✓ Demographic forecasts show that the number of deaths will be on the rise (until about 2040). ✓ Cremation services: Crematorium ownership requires a municipal permit, creating a significant barrier to entry. External ✓ Funeral plann
Slide 33: Tokyohakuzen's Strengths and Business Features
3-04 Tokyohakuzen’s Strengths and Business Features 5 Reasons Why Customers Choose Tokyohakuzen Development of Facility that integrates environmentally crematoriums and Luxurious space friendly crematory design funeral venues systems Capable of Attentive and accommodating detailed service for variou
Slide 34: Medium-to Long-Term Vision in Senior & Ending Market
3-05 Medium-to Long-Term Vision in Senior & Ending Market Horizontal development of crematory contracting (Operation of crematoriums, Partnership with provision of funeral halls) Prepare furnace manufacturer Tokyohakuzen Prepare Export cremation furnaces Prepare Expansion into funeral planning servi
Slide 35: Funeral Services Segment Financial Plan & Business Strategy
3-06 Funeral Services Segment｜Financial Plan & Business Strategy Financial Plan (Millions of yen) FY03/20 FY03/21 FY03/22 FY03/23 FY03/24 FY03/25 Actual Actual Actual Plan Plan Plan Net sales 8,735 8,333 9,384 10,860 12,795 14,790 Funeral Operating profit services Old segment 2,564 2,437 3,083 3,380
Slide 36: Information Segment Financial Plan & Business Strategy
3-07 Information Segment｜Financial Plan & Business Strategy Financial Plan (Millions of yen) FY03/20 FY03/21 FY03/22 FY03/23 FY03/24 FY03/25 Actual Actual Actual Plan Plan Plan Net sales 20,789 18,496 19,120 19,570 19,680 19,770 Operating profit Information Old segment 55 163 377 1 80 140 segment di
Slide 37: HR Segment Financial Plan & Business Strategy
3-08 HR Segment｜Financial Plan & Business Strategy Financial Plan (Millions of yen) FY03/20 FY03/21 FY03/22 FY03/23 FY03/24 FY03/25 Actual Actual Actual Plan Plan Plan Net sales 5,545 4,663 6,856 7,370 8,125 9,840 Operating profit HR Old segment 159 -65 341 110 400 700 disclosure standards Segment O
Slide 38: Shareholder Returns Dividend Forecast
3-09 Shareholder Returns｜Dividend Forecast (Millions of yen) FY03/20 FY03/21 FY03/22 FY03/23 FY03/24 FY03/25 Actual Actual Actual Plan Plan Plan Net profit -2,671 854 3,643 2,950 3,750 4,800 Target dividends (in exact yen) - - - 443 1,125 1,440 Target dividend payout ratio - - - 15% 30% 30% ✓ Resume
Slide 39: Appendix: Company Introduction
Appendix: A Company Introduction 38
Slide 40: Company Overview
A-01 Company Overview Company Establish KOSAIDO Holdings Co., Ltd. ment January 1949 name 35,361 Total 66,992 38,534 Net sales Net assets million yen assets million yen million yen (FY03/22) (as of September 30, 2022) (as of September 30, 2022) Represent ative Hiroshi Kurosawa, President & CEO Numbe
Slide 41: History
A-02 History Kosaido Group 2021 Transitioned to a holding 1984 company structure Tokyohakuzen joined the Group (Started ending-related business) 1970 Founded Japan’s first 2022 computer typesetting Launched company Funeral planning Services 2013 (Kosaido Lifewell, Gran Established Vietnam subsidiary
Slide 42: Mission, Vision, and Value
A-03 Mission, Vision, and Value MISSION Further enrich 100-year lives VISION A Company that creates myriad “thank yous” Provide innovative services overflowing with gratitude VALUE through individual challenges and strong organizational connections. Based on our management philosophy of “Kosai,” whi
Slide 43: KOSAIDO Group
[Main businesses] Crematory operation and A-04 KOSAIDO Group provision of funeral halls Ending-related Business Funeral planning services Ending-related business Further enrich 100-year lives. [Main businesses] Information Solution Business Offset printing (publishing, commercial) Newspaper printing
Slide 44: KOSAIDO Group's SDGs Declaration
A-05 KOSAIDO Group’s SDGs Declaration Economy Society Providing wide-ranging support Live in harmony with others To put our corporate philosophy Value creation for sustainable economic activities Developing equitable and diverse communities of "contributing to society at Even in a fast-changing worl
Slide 45: Contact
Contact This material will be available on our company website. If you have any comments or concerns about this presentation or other IR-related topics, please use the inquiry form below to contact us. Inquiry Form URL: https://www.kosaido.co.jp/contact/ Copyright 2022 KOSAIDO Holdings Co., Ltd. All
Slide 46: Further enrich 100-year lives
Further enrich 100-year lives <Precautionary note regarding this material> The figures included in the financial forecast and other sections of this material are based on judgements and assumptions made by the Company according to currently available information. Please be aware that actual results