Milbon Co., Ltd. · TSE:4919
Milbon — Q1 FY2025 Earnings Presentation
49 slides from Milbon's earnings presentation, May 13, 2025
Slide 1: Financial Results for Q1 of FY2025
Financial Results for Q1 of FY2025 (Ending December 31, 2025) Milbon Co., Ltd. (TSE code: 4919) May 13, 2025 © Milbon Co., Ltd. All rights reserved.
Slide 2: Contents
1. Consolidated Financial Results P2 2. Financial Results by Region and Outlook After Q2 P8 Contents 3. Review of Policy for Capital Allocation P16 4. Appendix P18 5. Overview of Milbon P30 This document has been translated from the Japanese original for reference purposes only. In the event of any
Slide 3: Today's Message
Today’s Message FY2025 Sales and profits declined due to reactionary effects and temporary factors. While the 1Q YTD financial results have fallen short of our Q1 target, there has been a recovery trend in both Results domestic and overseas markets since March. • Despite the solid performance of hai
Slide 4: Consolidated Statement of Earnings
Consolidated Statement of Earnings Sales and profits declined due to reactionary effects and temporary factors. The shortfall in profits was mainly driven by sales not meeting our target. FY2024 % FY2025 % Diff. FY2025 Vs. Target Diff. (Unit: million yen) 1Q YTD Total 1Q YTD Total (%) 1Q YTD Target
Slide 5: Factors Behind the Shortfall in Consolidated Net Sales
Factors Behind the Shortfall in Consolidated Net Sales Domestic sales faced challenges due to market and internal factors, yet have improved since March. As we move forward, we will closely monitor the impact of the price revisions starting in May. Overseas sales in January and February were impacte
Slide 6: Consolidated Operating Income – Factors Behind YoY Changes
Consolidated Operating Income – Factors Behind YoY Changes In addition to sales decline, operating income fell due to a planned increase in SG&A expenses. Decrease in gross profit due to 1,337 lower sales Increase in gross (million yen) profit margin Personnel (206) +17 expenses R&D Logistics (145)
Slide 7: Consolidated Operating Income – Factors Behind Difference vs. Target
Consolidated Operating Income – Factors Behind Difference vs. Target Operating income fell short of our target due to the decline in net sales, which were below our target. Although a portion of marketing expenses remained unspent, SG&A expenses were generally in line with the full-year budget. Decr
Slide 8: Contents
1. Consolidated Financial Results P2 2. Financial Results by Region and Outlook After Q2 P8 Contents 3. Change in Policy for Capital Allocation P16 4. Appendix P18 5. Overview of Milbon P30 © Milbon Co., Ltd. All rights reserved. 8
Slide 9: Net Sales and Operating Income by Region
Net Sales and Operating Income by Region Both net sales and operating income experienced declines across domestic and overseas markets. In South Korea, net sales were negatively impacted by the appreciation of the yen. FY2025 Exchange Exchange FY2024 FY2025 Actual Diff. Diff. Diff. (%) 1Q YTD Rate R
Slide 10: Financial Results by Region: Japan
Financial Results by Region: Japan Solid hair care sales could not offset declines in hair coloring and cosmetics, resulting in overall decreases in sales and operating income. Net sales trend was sluggish in January and February, but has been improving since March. Consequently, the full-year targe
Slide 11: Financial Results by Region: South Korea
Financial Results by Region: South Korea Sales faced headwinds in the first quarter due to temporary setbacks, including declining consumer spending amid political turmoil and inventory adjustments related to a distributor’s warehouse relocation. However, we anticipate improvement from the second qu
Slide 12: Financial Results by Region: China
Financial Results by Region: China Both net sales and operating income remain stable and are progressing ahead of our target, despite a year-on-year decline due to the high benchmark set by the surge in salon visits in January last year preceding the Chinese Lunar New Year. YoY Growth Rate of Sales
Slide 13: Financial Results by Region: United States
Financial Results by Region: United States While consumer sentiment in the US hair salon market has been worse, our hair care products have shown strong growth. Although the increase in headcount has led to a decrease in operating income compared to the previous year, both sales and income have exce
Slide 14: The Impact of US Tariffs on Our Financial Results
The Impact of US Tariffs on Our Financial Results The impact of additional US tariffs was not considered in our full-year target announced in February. The anticipated impact on our financial results as of May 13 is as follows: Production Facility for Products Sold in the United States Approximately
Slide 15: Outlook After Q2
Outlook After Q2 The full-year target remains unchanged. We aim to achieve this target through various sales strategies and cost-reduction initiatives. Outlook After Q2 Q • We anticipate that the demand for our hair care products will remain strong and steady. Japan • In the hair coloring products,
Slide 16: Contents
1. Consolidated Financial Results P2 2. Financial Results by Region and Outlook After Q2 P8 Contents 3. Change in Policy for Capital Allocation P16 4. Appendix P18 5. Overview of Milbon P30 © Milbon Co., Ltd. All rights reserved. 16
Slide 17: Review of Policy for Capital Allocation
Review of Policy for Capital Allocation We are considering further utilizing interest-bearing debt for the expansion of the Yumegaoka Factory, given the recent financial market conditions and improving capital efficiency. Consequently, we will revise our capital allocation from 2025 to 2026. Capital
Slide 18: Agenda
1. Consolidated Financial Results P2 2. Financial Results by Region and Outlook After Q2 P8 3. Change in Policy for Capital Allocation P16 4. Appendix P18 Agenda Consolidated Net Sales and Sales Ratio by Product Category Status of Main Brands Sales Growth and Sales Ratio by Category in Japan and Ove
Slide 19: Consolidated Net Sales and Sales Ratio by Product Category
Consolidated Net Sales and Sales Ratio by Product Category FY2024 FY2025 FY2025 (Unit: million yen) 1Q 2Q 3Q 4Q YTD 1Q 2Q 3Q 4Q YTD Target Net Sales 11,508 13,017 12,467 14,322 51,316 11,180 11,180 54,250 Hair Care 6,670 8,012 7,560 9,080 31,324 6,938 6,938 33,830 Hair Coloring 4,044 4,301 4,308 4,5
Slide 20: Status of Main Brands – Hair Care Products
Status of Main Brands – Hair Care Products Hair Care – Aujua Hair Care – Global Milbon The number of salons introducing Aujua continued to expand both in Sales growth is being propelled by our strong performance in Japan and South Korea. overseas markets, especially in the United States. FY2024 FY20
Slide 21: Status of Main Brands – Hair Coloring Products
Status of Main Brands – Hair Coloring Products Hair Coloring – Ordeve Addicthy Hair Coloring – Villa Lodola Color The domestic fashion color market continues to face a slowdown and The number of salons introducing Villa Lodola Color has increased heightened competition. We aim to boost sales by supp
Slide 22: Status of Main Brands – Cosmetics
Status of Main Brands – Cosmetics Cosmetics – Imprea Cosmetics – IM Both our mainstay product, Lotion, and the new launch, Balance Tuner, Sales declined due to the slow adoption by salons of the newly have received strong market recognition. added eyebrow mascara items launched in Q1 last year. FY20
Slide 23: Sales Growth and Sales Ratio by Category in Japan and Overseas (Local Currency Basis)
Sales Growth and Sales Ratio by Category in Japan and Overseas (Local Currency Basis) FY2024 FY2025 Japan 1Q 2Q 3Q 4Q YTD 1Q 2Q 3Q 4Q YTD Net Sales +9.3% +5.0% +7.7% +3.0% +6.0% (2.5%) (2.5%) Hair Care +9.1% +8.9% +13.4% +7.1% +9.4% +6.6% +6.6% Hair Coloring +0.8% (0.5%) +1.1% (0.5%) +0.2% (7.9%) (7
Slide 24: Sales Growth and Sales Ratio by Category in Japan and Overseas (Local Currency Basis)
Sales Growth and Sales Ratio by Category in Japan and Overseas (Local Currency Basis) FY2024 FY2025 China 1Q 2Q 3Q 4Q YTD 1Q 2Q 3Q 4Q YTD Net Sales +4.3% (16.5%) +0.0% +2.0% (2.7%) (3.9%) (3.9%) Hair Care +6.2% (3.3%) +8.3% +3.4% +3.6% (0.6%) (0.6%) Hair Coloring (0.6%) (33.7%) (9.1%) (3.5%) (12.7%)
Slide 25: Progress on milbon:iD and Smart Salon Initiatives
Progress on milbon:iD and Smart Salon Initiatives milbon:iD Although the number of salons decreased due to the exclusion of closed locations following a change in the counting method, user registrations have steadily increased. Starting in June, we will connect milbon:iD to the LINE messaging app to
Slide 26: Status of Inventory
Status of Inventory (million yen) Increase due to seasonality Increase Factor: (launch of new ・ Meet demand before next year’s products) price revision Increase due ・ Prepare for new Increase due to to seasonality products preparations for (launch of new the anticipated products) Decrease Factor: de
Slide 27: Status of Capital Expenditures, etc.
Status of Capital Expenditures, etc. FY2025 FY2025 FY2021 FY2022 FY2023 FY2024 (Unit: million yen) 1Q YTD Target Capital Expenditures 4,644 4,097 3,151 2,865 890 2,611 Depreciation and 1,777 2,026 2,213 2,288 567 2,354 Amortization Amount 1,741 2,074 2,334 2,452 631 2,829 R&D exp. % to 4.2 4.6 4.9 4
Slide 28: The Number of Field Person (FP)
The Number of Field Person (FP) The Number of FP by Country FP Recruitment and Training Status in Japan Upper column: Average number of FPs during the period (persons) Lower column: Net sales per FP (million yen) FY2022 FY2023 FY2024 FY2025 As of March 31, 2025 Japan 335.4 350.2 361.4 368.5 10 FPs j
Slide 29: Forex Assumption and Sensitivities
Forex Assumption and Sensitivities (million yen) Impact on FY2025 Impact on Consolidated Assumption Consolidated Net Sales Operating Income KRW 0.108 yen ±0.001 yen → 51 ±0.001 yen → 38 RMB 20.5 yen ±0.1 yen → 11 ±0.1 yen → 2 USD 145.0 yen ±1 yen → 15 ±1 yen → 4 © Milbon Co., Ltd. All rights reserve
Slide 30: Contents
1. Consolidated Financial Results P2 2. Financial Results by Region and Outlook After Q2 P8 Contents 3. Change in Policy for Capital Allocation P16 4. Appendix P18 5. Overview of Milbon P30 © Milbon Co., Ltd. All rights reserved. 30
Slide 31: Overview of Milbon
Overview of Milbon Milbon is a cosmetics manufacturer that produces and sells haircare products including treatments and hair coloring products exclusively to hair salons. Cosmetics market Professional hair cosmetics market Domestic market size: Approx. 200 billion yen* Domestic market share Approx.
Slide 32: Milbon: Business Model
Overview of Milbon: Business Model We have established solid trust with hair salons by offering our products and services that contribute to enhance their sales and profits. The distribution flow of Our sales personnel, Field Person, identifies salon tasks, provides educational support, and products
Slide 33: Milbon: Three Key Points of Our Business Model
Overview of Milbon: Three Key Points of Our Business Model Consistent focus on hair salons and hair stylists Since our founding in 1960, we have sustained continuous growth by steadfastly narrowing our business focus to hair salons, with the strategy of increasing sales and profits of hair salons at
Slide 34: Milbon: Our Growth Trajectory
Overview of Milbon: Our Growth Trajectory Steady growth through business expansion in Japan and overseas Net Sales and Operating Income Composition of Sales by (billion yen) Launched “Smart Salons” (billion yen) Country (FY2024) Launched “milbon:iD”, our official online stores Launched “Imprea”, sal
Slide 35: Milbon: Our Main Products
Overview of Milbon: Our Main Products Haircare and hair coloring products are the mainstay of our sales. In recent years, we have expanded our business to include cosmetics, etc. Composition of Sales by Product Category Cosmetics (only available in Japan) (FY2024) Haircare Products sold for retail i
Slide 36: Milbon: Domestic Hair Salon Market Conditions
Overview of Milbon: Domestic Hair Salon Market Conditions Hair salons have the potential for further growth despite the medium- to long term decrease in the number of customers due to declining birth rate and aging population. Challenges and Growth of Aging Population with Low Fertility Community Ch
Slide 37: Milbon: Our Recent Initiatives in Japan, milbon:iD
Overview of Milbon: Our Recent Initiatives in Japan, milbon:iD We launched milbon:iD, an EC platform, in 2020 to support productivity enhancement of hair salons. This platform allows salon customers to purchase retail products online. How milbon:iD Works – Revenue is attributed to salons in the BtoB
Slide 38: Milbon: Our Recent Initiatives in Japan, Two Major Strategies
Overview of Milbon: Our Recent Initiatives in Japan, Two Major Strategies We aim to maximize the inherent value of hair salons, which enables frequent and extended in- person visits, by enhancing our Smart Salon concept and broadening the range of products available for in-salon purchase. Smart Salo
Slide 39: Milbon: Status of Overseas Expansion
Overview of Milbon: Status of Overseas Expansion We conduct business across the world, and have recently expanded our international bases for R&D as well as production. Milbon Europe Milbon Korea GmbH Co., Ltd. Milbon Trading(Shanghai) Istanbul Main Branch Co.,Ltd. Milbon Co., Ltd. MILBON USA, INC.
Slide 40: Milbon: Our Three Major Overseas Countries
Overview of Milbon: Our Three Major Overseas Countries Three major countries, South Korea, China, and the USA account for nearly 80% of overseas sales South Korea China USA Our educational initiatives focused on hair Subsequent to COVID-19, activities for hair We have enjoyed rapid growth triggered
Slide 41: Milbon: Other Countries and Regions
Overview of Milbon: Other Countries and Regions Our sales are particularly significant in East Asia and ASEAN, and we have recently expanded into Europe. Europe and Middle East East Asia (Taiwan and Hong 12.8% Kong) 35.8% FY2024 Sales in Other Countries and Regions 2.98 billion yen ASEAN 51.4% © Mil
Slide 42: Milbon: Our Global R&D and Production
Overview of Milbon: Our Global R&D and Production We aim to minimize geopolitical risks and to align ourselves with the diverse values of beauty unique to each locality, by establishing R&D and production systems in each region. R&D－ Production－ Collaboration Among our Four Global R&D Bases Collabor
Slide 43: Milbon: Shareholder Returns
Overview of Milbon: Shareholder Returns We have set a dividend payout ratio target of 50% and will increase or maintain dividends without reducing them, aiming for higher dividends in line with profit growth. (Yen) FY2025 Target 88 yen © Milbon Co., Ltd. All right reserved. 43
Slide 44: Milbon: Corporate Governance Structure
Overview of Milbon: Corporate Governance Structure See our Integrated Report for more details ： https://www.milbon.com/en/ir/library/report.html © Milbon Co., Ltd. All right reserved. 44
Slide 45: Milbon: Compensation for Board Members
Overview of Milbon: Compensation for Board Members Compensation for board directors (excluding external board directors) shall consist of cash and stock- based compensation as an incentive to continuously increase corporate value, in order to encourage each board director to perform their duties wit
Slide 46: Milbon: Status of Dialogues with Shareholders (FY2024)
Overview of Milbon: Status of Dialogues with Shareholders (FY2024) We held a total of 163 meetings throughout the year, led primarily by the Managing Executive Director in charge of Finance and IR. During interim and year-end results reporting, the President and CEO actively participated in IR meeti
Slide 47: Milbon: Status of Dialogues with Shareholders (FY2024)
Overview of Milbon: Status of Dialogues with Shareholders (FY2024) In response to the various opinions and requests from institutional investors and other shareholders, we outlined the main examples of changes in our actions and disclosures resulting from these dialogues. ■Incorporation of Feedback
Slide 48: Milbon: ESG Investment Index and External Assessments
Overview of Milbon: ESG Investment Index and External Assessments ESG investment index to be selected THE INCLUSION OF Milbon Co., Ltd. IN ANY MSCI INDEX, AND THE USE OF MSCI LOGOS, TRADEMARKS, SERVICE MARKS OR INDEX NAMES HEREIN, DO NOT CONSTITUTE A SPONSORSHIP, ENDORSEMENT OR PROMOTION OF Milbon C
Slide 49: Disclaimer
Disclaimer With respect to the business forecasts included in this document, any statement that is not historical fact is a forward-looking statement based on information available and certain premises that are judged to be rational at the time of the announcement. Please be aware that actual result