United Arrows Ltd. · TSE:7606
United Arrows — Q1 FY2025/3 Earnings Presentation
42 slides from United Arrows's earnings presentation, Aug 7, 2024
Slide 1: Financial Results Briefing
For the Three Months of Fiscal Year Ending March 31, 2025 Financial Results Briefing 2024.08.07 UNITED ARROWS LTD.
Slide 2: Table of Contents
Table of P03– | 1 Overview of FY2025/3 1Q Business Results Contents P21– | 2 Progress in Sustainability Initiatives P30– | 3 Message from Yoshinori Matsuzaki, Representative Director, President, and CEO P36– | 4 Reference Materials
Slide 3: Cautionary Statement
Cautionary Statement Earnings forecasts and descriptions other than objective facts contained in this document are based on decisions made by UNITED ARROWS LTD. in light of information obtainable as of the date of this report and, therefore, include risks and uncertainties. Actual earnings may diffe
Slide 4: Overview of FY2025/3 1Q Business Results
Overview of FY2025/3 1Q Business Results
Slide 5: Financial Highlights
Overview of FY2025/3 1Q Business Results Financial Highlights Consolidated Sales and gross profit exceeded the plan and the previous year, SGA expenses were roughly at the expected level, and operating income and ordinary income also exceeded the plan and the previous year. Net income attributable t
Slide 6: Consolidated Sales and Gross Margin
Overview of FY2025/3 1Q Business Results Consolidated Sales Consolidated Gross Margin YoY ¥35,495million 110.4% YoY 54.7% -0.3pt (Millions of yen) 55.0% 35,495 54.7% 32,155 54.5% 29,664 51.5% 25,264 43.4% 22,198 FY21/3 FY22/3 FY23/3 FY24/3 FY25/3 FY21/3 FY22/3 FY23/3 FY24/3 FY25/3 * CHROME HEARTS JP
Slide 7: Consolidated operating income and net income
Overview of FY2025/3 1Q Business Results Consolidated operating income Net income attributable to owners of parent YoY ¥2,768million 110.6% ¥1,763million 98.0% YoY (Millions of yen) (Millions of yen) 1,798 1,763 2,502 2,768 1,323 1,853 (903) (648) (5,019) (3,582) FY21/3 FY22/3 FY23/3 FY24/3 FY25/3 F
Slide 8: Consolidated P/L
Overview of FY2025/3 1Q Business Results Consolidated P/L (Millions of yen) FY24/3 FY25/3 Change/pt YoY 3M 3M difference Sales 32,155 35,495 3,340 110.4% Gross profit 17,678 19,412 1,734 109.8% vs. sales 55.0% 54.7% - 0.3pt － SGA expenses 15,176 16,644 1,468 109.7% vs. sales 47.2% 46.9% - 0.3pt － Op
Slide 9: Consolidated Gross Margin
Overview of FY2025/3 1Q Business Results Consolidated Gross Margin The business unit carried out markdown sales ahead of schedule, but gross margin for total business unit remained at the same level as the previous year The decrease in the non-consolidated gross margin is mainly due to the differenc
Slide 10: Consolidated SGA expenses
Overview of FY2025/3 1Q Business Results Consolidated SGA expenses (Millions of yen) FY24/3 FY25/3 Change/pt YoY 3M 3M difference Total SGA expenses 15,176 16,644 1,468 109.7% vs. sales 47.2% 46.9% -0.3pt - Advertising expenses 720 920 199 127.7% vs. sales 2.2% 2.6% 0.4pt - Personnel expenses 5,429
Slide 11: Consolidated B/S
Overview of FY2025/3 1Q Business Results Consolidated B/S (Millions of yen) As of Mar. 31, vs. previous term-end As of Jun. 30, 2024 2024 Change Total Assets 60,204 62,992 2,787 104.6% Composition ratio 100.0% 100.0% - - Current Assets 40,372 42,734 2,362 105.9% Composition ratio 67.1% 67.8% - Noncu
Slide 12: Consolidated C/F
Overview of FY2025/3 1Q Business Results Consolidated C/F (Millions of yen) FY24/3 3M FY25/3 3M Major breakdown of the results for the term Cash flows from operating activities (sub-total) (5) 2,470 Income before income taxes 2,804 Increase in other current liabilities 449 Cash flows from operating
Slide 13: Non-consolidated Sales and Gross Margin
Overview of FY2025/3 1Q Business Results Non-consolidated Sales Non-consolidated Gross Margin Non-consolidated Existing Stores YoY Difference from previous ¥33,117million 110.8% 54.9% 113.0% YoY period -0.1pt Sales (Millions of yen) Number of purchasing customers 110.2% 33,117 102.4% Avg. spend per
Slide 14: Non-consolidated Sales by Channel
Overview of FY2025/3 1Q Business Results Non-consolidated Sales by Channel Existing stores YoY (Millions of yen) Avg. spend FY24/3 FY25/3 Change/pt Number of YoY Sales per 3M 3M difference customers customer Non-consolidated Retail + Online 113.0% 110.2% 102.4% sales 29,894 33,117 3,223 110.8% Retai
Slide 15: Non-consolidated Sales by Business
Overview of FY2025/3 1Q Business Results Non-consolidated Sales by Business (Millions of yen) FY24/3 FY25/3 Change YoY 3M 3M Total business unit sales 24,742 28,120 3,377 113.7% Trend-Conscious Market 16,480 18,466 1,986 112.1% Basic Trend-Conscious Market 8,262 9,653 1,391 116.8% Existing stores Yo
Slide 16: Group Company Results
Overview of FY2025/3 1Q Business Results Group Company Results COEN CO., LTD. (Millions of yen) Feb– Apr 2,370 2,251 2,168 2,179 Increase in both sales and profit 1,823 • Sales ¥2,179 million, YoY 100.5% • Although sales exceeded the previous year’s figure, profits decreased due to a decline in gros
Slide 17: Opening and Closing of Stores
Overview of FY2025/3 1Q Business Results Opening and Closing of Stores Due to some of COEN CO., LTD.'s new store openings being postponed to the next fiscal year, the number of stores at the end of the fiscal year is expected to be 321, an increase of 20 stores from the end of the previous fiscal ye
Slide 18: Starting store opening for new businesses
Overview of FY2025/3 1Q Business Results Starting store opening for new businesses ATTISESSION conte • A women’s brand targeting the MZ generation • New brand for independent adult women • Appointed a female in her 20’s from BY shop staff as director • Appointed Emiri Henmi as director • Sales start
Slide 19: Direction of new business
Overview of FY2025/3 1Q Business Results Direction of new business Objective of new business is to solve issues towards achieving the long-term vision (age axis, taste axis) Trend-conscious market Basic Trend conscious market 50s 50s 40s 40s New brand 30s 30s 20s 20s Casual Conservative Mode Casual
Slide 20: Scale of assumed sales of new business
Overview of FY2025/3 1Q Business Results Scale of assumed sales of new business Brand CITEN ATTISESSION conte New brand (TBD) Introduction timing Fall 2021 Spring 2024 Fall 2024 Spring 2025 Basic Trend conscious Basic Trend conscious Market Trend-conscious market Trend-conscious market market market
Slide 21: Overseas Expansion: UNITED ARROWS EMSPHERE opens
Overview of FY2025/3 1Q Business Results Overseas Expansion: UNITED ARROWS EMSPHERE opens • In June 2024, opened a franchise store in “EMSPHERE,” a large shopping mall in Bangkok, Thailand • Sales of men’s clothing made from functional materials were strong, particularly among those in the fashion i
Slide 22: Progress in Sustainability Initiatives
Progress in Sustainability Initiatives
Slide 23: History of Our Sustainability Activities
Progress in Sustainability Initiatives History of Our Sustainability October 1999 (at the time of listing) to present Activities Our Commitment: Creating Five Values Customers, Employees, Business Partners, Society, Shareholders May 2020 to present Five Themes and 16 Material Issues Supply Chain, Re
Slide 24: Creating the maximum corporate value with limited resources
Progress in Sustainability Initiatives Departure from an orientation toward sales expansion on the premise of mass production and mass consumption means: “Creating the maximum corporate value with limited resources” = Procuring appropriate amounts of products properly and selling them without waste
Slide 25: Sustainability Initiatives of UNITED ARROWS
Progress in Sustainability Initiatives Sustainability Initiatives of UNITED ARROWS Circular fashion Toward a carbon-neutral world Work and live in a healthy way Positive impact on the earth To preserve our beautiful For every stakeholder of UNITED with fashion, UNITED ARROWS earth UNITED ARROWS LTD.
Slide 26: Sustainability targets and progress
Progress in Sustainability Initiatives Circulating fashion Toward a carbon-neutral world Work and live healthily Waste rate of textile products CO2 emission reduction rate Acquisition rate of Code of (Scope 1 and 2) Conduct Agreements 2022 2023 2030 TARGET 2022 2023 2030 TARGET 2022 2023 2030 TARGET
Slide 27: Continuing efforts: Circulating fashion
Progress in Sustainability Initiatives Continuing efforts • Improvement of the fixed-price-sales ratio (the ratio of original retail price) and inventory turnover ratio • Reducing product waste rates through recycling, reuse, etc. Circulating fashion Initiatives for fiscal 2022 Waste rate of textile
Slide 28: Continuing efforts: Toward a carbon-neutral world
Progress in Sustainability Initiatives Continuing efforts • Conduct a survey on the energy situation at commercial facilities where our shops are open and discuss the future use of renewable energy • Promoting “SARROWS Reduce Action,” an initiative to cultivate abundant Toward a carbon-neutral world
Slide 29: Continuing efforts: Work and live healthily
Progress in Sustainability Initiatives Continuing efforts • Continue to conduct on-site audits at domestic partner factories • Promoting various personnel measures to improve employee engagement Work and live healthily Initiatives for fiscal 2022 Acquisition rate of Code of Conduct Agreements • Star
Slide 30: Sustainability Committee activities
Progress in Sustainability Initiatives In fiscal 2023, the Sustainability Committee met 10 times and the Sustainability Subcommittee of the Risk Management Committee met 3 times • Both committees are chaired by the Representative Director and have Executive Directors as members • The Sustainability
Slide 31: Message from Yoshinori Matsuzaki, Representative Director, President, and CEO
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO
Slide 32: 1Q Favorable Factors
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO 1Q Favorable Factors Non-consolidated By business Existing stores YoY Pricing strategies optimized for market Sales 112.4% 114.1% characteristics 104.5% Trend-conscious market: Number of customers 110.9% Increase in the nu
Slide 33: 1Q Favorable Factors
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO 1Q Favorable Factors Recovery of GLR Women through product promotion “Conclusion” series 1Q GLR Women’s Retail + online existing store sales YoY 123.6 % • As a conclusion to the idea of “clothes that won’t disappoint,” we
Slide 34: 1Q Favorable Factors
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO 1Q Favorable Factors Increase in UA Club member sales, penetration of OMO measures Number of active members at end UA Club membership sales UA Club membership sales of 1Q composition ratio (Non-consolidated) 1.4 (YoY 105.5
Slide 35: 1Q Favorable Factors
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO 1Q Favorable Factors Increase in inbound sales ¥1.32 4.0 1Q Inbound Sales Inbound Composition Ratio (Non-consolidated) billion % (YoY 163.3%) (YoY change: 1.3 pts) Non-consolidated Inbound sales • Purchasing mainly from Ch
Slide 36: Three Key Strategies
Message from Yoshinori Matsuzaki, Representative Director, President, and CEO Three Key Strategies providing excitement - connecting with customers widely and deeply 35
Slide 37: Reference Materials
Reference Materials
Slide 38: Consolidated Business Plan
Reference Materials Consolidated Business Plan (Millions of yen) Sales ¥150,000 million (YoY 111.7%) FY24/3 Results FY25/3 Plan YoY change/vs. sales pt difference Gross margin 52.5% (pt difference 0.8pt) Sales 134,269 150,000 15,730 111.7% Gross profit 69,462 78,790 9,327 113.4% Operating income ¥7,
Slide 39: Gross Margin Plan
Reference Materials Gross Margin Plan FY25/3 FY25/3 FY25/3 YoY YoY YoY 1H 2H full term Consolidated 53.0% 0.6pt 52.1% 1.0pt 52.5% 0.8pt UNITED ARROWS LTD. 52.8% 0.7pt 51.8% 0.8pt 52.2% 0.8pt Total of business units sales - 0.6pt - 0.6pt - 0.6pt Outlet, etc. - 1.6pt - 0.9pt - 1.2pt COEN CO., LTD. - 0
Slide 40: Non-consolidated Sales Plan
Reference Materials Non-consolidated Sales Plan (Millions of yen) FY25/3 FY25/3 FY25/3 1H YoY 2H YoY full term YoY Non-consolidated sales 60,405 108.4% 76,527 112.6% 136,933 110.7% Retail + Online existing - 109.6% - 109.8% - 109.7% stores Retail existing stores - 106.0% - 106.7% - 106.4% Online exi
Slide 41: Financial impact of transition to UA Club
Reference Materials Financial impact of transition to UA Club Due to the difference in the Assuming future use of the increase, a portion of the The increased amount will be Convert old “points” held by return rates, the amount increase was lumped into the recorded as a sales discount members to “mi
Slide 42: UNITED ARROWS LTD. Retail Store Opening and Closing
Reference Materials UNITED ARROWS LTD. Retail Store Opening and Closing 1Q results Full-year forecast No. of No. of No. of stores at stores at Opened Closed stores at Opened Closed the period-end FY24/3 the 1Q-end (Forecast) end UNITED ARROWS LTD. Total 221 3 0 224 16 2 235 Trend-conscious Market To