AOKI Holdings, Inc. · TSE:8214
AOKI — FY2013 Earnings Presentation
63 slides from AOKI's earnings presentation, May 23, 2013
Slide 1: Performance Briefing for the Fiscal Year Ended March 31, 2013
Performance Briefing for the Fiscal Year Ended March 31, 2013 May 23, 2013 AOKI Holdings Inc.
Slide 2: Contents
Contents AOKI Group's Business Portfolio Management 3 Anniversaire and Bridal Business Performance and Forecast 33 Business Portfolio Comprised of Three Segments 4 Features and Position within Industry 34 FY3/13 Financial Highlights and Sustaining Growth 5 FY3/13 Review of Operations 35 Group Networ
Slide 3: AOKI Group's Business Portfolio Management
AOKI Group’s Business Portfolio Management
Slide 4: Business Portfolio Comprised of Three Segments
Business Portfolio Comprised of Three Segments Fashion Business Anniversaire and Bridal Business Entertainment Business "Pleasure of dressing well" Choreographing special events where Offering entertainment and relaxation The AOKI Group's founding business. Suits are customers are in the spotlight P
Slide 5: FY3/13 Financial Highlights
FY3/13 Financial Highlights Sales and profits increased in each business, translating into record high profits for the Group Sales Operating Profit (Billions of yen) (Billions of yen) 180 20 10.6% 160.5 9.4% 18 17.0 160 146.5 17.1 1.0 16 140 131.1 132.5 14.6 Operating 1.4 15.2 8.3% 13.7 margin 9.9 1
Slide 6: Business Portfolio Sustaining Growth
Business Portfolio Sustaining Growth Group targeting record sales and operating profit in FY3/14 Sales Operating Profit (Billions of yen) (Billions of yen) 180 19 175.8 18.6 18 170 17.0 160.5 17 160 16 150 15 140 14 1300 130 FY3/13 FY3/14 Plan FY3/13 FY3/14 Plan AOKI Holdings Inc. 6
Slide 7: Group Network Expected to Top 1,000 Stores by End of FY3/14
Group Network Expected to Top 1,000 Stores by End of FY3/14 (Stores) 1,200 AOKI ORIHICA ANNIVERSAIRE COTE D'AZUR KAIKATSU CLUB 1,039 1,000 933 848 236 Opening of our largest class wedding facility 787 211 ANNIVERSAIRE 800 746 MINATO MIRAI 172 152 158 YOKOHAMA 133 143 600 132 14 118 126 13 125 12 13
Slide 8: AOKI Group's Target Benchmarks
AOKI Group's Target Benchmarks Steady progress toward medium-term management target FY3/12 FY3/13 Medium-term Target Benchmark Level Benchmark Level Benchmark Level Operating margin 9.4% Operating margin 10.6% Operating margin 11% ROA 8.5% ROA 9.5% ROA 10% EPS ¥167.07 EPS ¥236.51 EPS ¥250 ROA ×100 (
Slide 9: Shareholder Returns: Dividends, Share Buybacks
Shareholder Returns: Dividends, Share Buybacks We plan to boost our annual dividend for FY3/14 from ¥45 to ¥60 (Yen) 70 ¥60 2Q Year Annual 60 end end 50 ¥45 30 FY3/11 15.0 15.0 30.0 40 ¥35 ¥30 30 25 FY3/12 15.0 20.0 35.0 15 20 20 FY3/13 20.0 25.0 45.0 30 10 15 15 20 FY3/14 (forecast) 30.0 30.0 60.0
Slide 10: FY3/13 Review of Operations
FY3/13 Review of Operations
Slide 11: Consolidated Profit and Loss
Consolidated Profit and Loss (Millions of yen) Account/Period FY3/12 FY3/13 Change YoY % Major components Contributions from new stores and an Sales 146,591 160,589 13,997 109.5 increase in existing-store sales at Fashion Business Gross profit 68,902 77,999 9,097 Improvement in 1.0pt at Fashion 113.
Slide 12: Sales and Operating Profit by Business Segment
Sales and Operating Profit by Business Segment Sales by business segment (Millions of yen) Business segment FY3/12 FY3/13 Change YoY % Major components Total 146,591 160,589 13,997 109.5 Increase in existing store sales and Fashion 94,252 103,932 9,679 110.3 contributions from new stores Increase in
Slide 13: Major Changes in Consolidated Balance Sheets
Major Changes in Consolidated Balance Sheets (Millions of yen) Account/Period FY3/12 FY3/13 Change Major components Current assets 52,924 58,267 5,343 Cash in hand and in banks 23,108 22,396 -712 Inventories 16,058 18,908 2,849 Increased due to openings of new stores, etc. Fixed assets 123,854 135,3
Slide 14: Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows (Millions of yen) Account/Period FY3/12 FY3/13 Change Major components Increase in net income before income taxes: Cash flows from operating ¥2,969mn 17,274 16,665 -608 Increase in inventories: ¥-2,071mn activities Increase in income taxes paid: ¥-653mn Increase
Slide 15: Number of Stores Opened/Closed
Number of Stores Opened/Closed (Millions of yen excluding number of stores) FY3/12 FY3/13 Business segment Stores/facilities Number of Number of Opened Closed Opened Closed Stores Stores AOKI 440 16 3 460 29 9 Fashion ORIHICA 91 25 4 106 16 1 Anniversaire and Bridal ANNIVERSAIRE 13 1 - 13 - - Karaok
Slide 16: FY3/14 Sales and Earnings Forecast
FY3/14 Sales and Earnings Forecast
Slide 17: Consolidated Forecast
Consolidated Forecast (Millions of yen) FY3/14 Account/Period FY3/13 Change YoY % Major Components (forecast) Sales 160,589 175,800 15,210 109.5 Contributions from new stores (111 stores) in each business segment Gross profit 77,999 85,175 7,175 109.2 Fashion Business remains flat Gross profit margi
Slide 18: Forecast for Sales and Operating Profit by Business Segment
Forecast for Sales and Operating Profit by Business Segment Sales by business segment (Millions of yen) Business segment FY3/13 FY3/14 (forecast) Change YoY % Total 160,589 175,800 15,210 109.5 Fashion 103,932 112,500 8,567 108.2 Anniversaire and Bridal 24,359 26,700 2,340 109.6 Entertainment (Total
Slide 19: Outlook for Store Openings/Closings
Outlook for Store Openings/Closings (Millions of yen excluding number of stores) FY3/13 FY3/14 (forecast) Business segment Stores/Facilities Number of Number of To be To be Opened Closed Stores Stores opened closed AOKI 460 29 9 506 50 4 Fashion ORIHICA 106 16 1 125 20 1 Anniversaire and Bridal ANNI
Slide 20: First Half of FY3/14 Consolidated Forecast
First Half of FY3/14 Consolidated Forecast (Millions of yen) 1H FY3/14 Account/Period 1H FY3/13 Change YoY % Major Components (forecast) Contributions from new stores (57 Sales 67,425 73,290 5,864 108.7 stores) in each business segment Gross profit 30,836 33,680 2,843 Improvement in 0.6pt at Fashion
Slide 21: Fashion Business FY3/13 Performance and FY3/14 Forecast
Fashion Business FY3/13 Performance and FY3/14 Forecast
Slide 22: Fashion Business: FY3/13 Performance
Fashion Business: FY3/13 Review of Operations Fashion Business: FY3/13 Performance Sales up for third straight year, profits up in double digits, operating margin 11.5% Sales Operating profit/ (Millions of yen) (Millions of yen) Operating margin 103,932 11,968 Sales up 10.3% YoY 94,252 Change in exi
Slide 23: Existing-store Sales Growth, Customer Volume and Sales per Customer
Fashion Business: FY3/13 Review of Operations Existing-store Sales Growth, Customer Volume and Sales per Customer Strong existing-store sales due to a respectable level of customer traffic and an increase in sales per customer FY3/13 YoY Change in Monthly Performance Feb-Mar: “Freshers” products sol
Slide 24: AOKI: FY3/13 Performance
Fashion Business: FY3/13 Review of Operations AOKI: FY3/13 Performance Aggressive store openings and coordinated marketing activities (coordination of product, sales promotions, visual merchandising, and marketing) for core products Suits and formal wears were firm due to the 1 strengthening proposa
Slide 25: AOKI: FY3/13 Performance (Ladies' Products, New Stores)
Fashion Business: FY3/13 Review of Operations AOKI: FY3/13 Performance Aggressive store openings and coordinated marketing activities (coordination of product, sales promotions, visual merchandising, and marketing) for core products Ladies’ products were strong due to the 3 strengthening of product
Slide 26: ORIHICA: FY3/13 Performance
Fashion Business: FY3/13 Review of Operations ORIHICA: FY3/13 Performance Store network reached 100 stores at end of FY3/13 due to ongoing efforts to improve store environment, product composition (business & business-to-casual), and new store openings in shopping centers Stepped up fashion suggesti
Slide 27: Fashion Business: FY3/14 Earnings Forecast
Fashion Business: FY3/14 Earnings Forecast Fashion Business: FY3/14 Earnings Forecast Forecast sales and profits increase due to an increase in sales at existing stores and contributions from newly opend stores Operating profit/ Sales Operating margin (Millions of yen) (Millions of yen) 12,750 120,0
Slide 28: AOKI: FY3/14 Initiatives
Fashion Business: FY3/14 Earnings Forecast AOKI: FY3/14 Initiatives Expanding market share by making over existing stores and actively opening new ones 1 Strengthen lineup of products that meet customers' needs and wants and keep up with fashion trends Further pursue functionality Promote by using c
Slide 29: ORIHICA: FY3/14 Initiatives
Fashion Business: FY3/14 Earnings Forecast ORIHICA: FY3/14 Initiatives Improving margins by polishing up our product composition and store environment, while continuing to open new stores in established shopping centers 1 Improving product composition, store environment in a bid to bring in new cust
Slide 30: New Market Created by AOKI -1
Fashion Business New Market Created by AOKI -1 Diversification of business wear: We want to propose a new category of business wear, with jackets and slacks that customers can mix and match Cool Biz gaining acceptance We launched “Ultra Cross Suits” under Trend toward “set-up suits” our CAFÉ SOHO br
Slide 31: New Market Created by AOKI -2
Fashion Business New Market Created by AOKI -2 Ladies' wear: Sustaining growth in three basic categories Share of total sales Targeting 2.9% in 11.9% in 13-15% FY3/07 FY3/13 up ahead Ladies' formal wear To reach our target, we want to sustain growth in three basic categories, which will help establi
Slide 32: Seeking Further Growth
Fashion Business Seeking Further Growth Store openings: Expanding market share via aggressive new store openings Planning record number of store openings during FY3/14 Number of stores 70 70 AOKI ORIHICA 45 20 41 35 25 16 25 50 21 4 16 29 0 FY3/11 FY3/12 FY3/13 FY3/14 (Plan) 1. Strengthen store open
Slide 33: Anniversaire and Bridal Business FY3/13 Performance and FY3/14 Forecast
Anniversaire and Bridal Business FY3/13 Performance and FY3/14 Forecast
Slide 34: Provides Anniversaire-style Weddings Mainly in Major Cities
Anniversaire and Bridal Business: Features and Position within Industry Provides "Anniversaire"-style Weddings Mainly in Major Cities Manage 13 facilities and 35 halls Metro area: 7 facilities Nagano Omiya Omotesando, Toyosu, Tokyo Bay, Tachikawa Hills Yokohama Fukuoka Kashiwa Kobe Osaka, Esaka Shir
Slide 35: Anniversaire and Bridal: FY3/13 Review of Operations
Anniversaire and Bridal Business: FY3/13 Review of Operations Sales rose and profits also rose sharply due to an increase in the number of married couples and average sales per couple, and improvement in gross profit margin Operating profit/ Sales Operating margin Sales up 3.9% YoY (Millions of yen)
Slide 36: Performance Benchmarks
Anniversaire and Bridal Business: FY3/13 Review of Operations Performance Benchmarks FY3/12 FY3/13 Change YoY % No. of facilities at period- 13 13 - - end No. of wedding/reception 35 35 - - halls at period-end No. of couples married 5,412 5,546 +134 102.5% Capacity utilization ratio 67.2% 69.5% +2.3
Slide 37: Measures to Strengthen Existing Facilities
Anniversaire and Bridal Business: FY3/13 Review of Operations Measures to Strengthen Existing Facilities Renovation of 6 facilities in response to customer needs and recent wedding trends Tachikawa (1 hall): Crystal decorations, furniture, antechamber, etc. Kobe (1 hall): Design on walls, chandelier
Slide 38: Anniversaire and Bridal: FY3/14 Earnings Forecast
Anniversaire and Bridal Business: FY3/14 Earnings Forecast Despite higher sales as more couples hold weddings, we expect profit to fall YoY due to higher start-up expenses for new facilities Operating profit/ Sales (Millions of yen) Operating margin Sales up 9.6% YoY (Millions of yen) Opening of ANN
Slide 39: Launching In-house Brand of Engagement and Wedding Rings
Anniversaire and Bridal Business: Initiatives during FY3/14 Launching In-house Brand of Engagement and Wedding Rings et TOUJOURS Product lineup: total of 15 (3 series, 5 designs) • Avenir: Adding color to each other's lives • Volonté: Taking care of each other • Sincérité: Sharing a new life togethe
Slide 40: Overview of ANNIVERSAIRE MINATO MIRAI YOKOHAMA
Anniversaire and Bridal Business: Initiatives during FY3/14 Overview of ANNIVERSAIRE MINATO MIRAI YOKOHAMA Overview of planned facility Wedding salon has started taking orders Facility name: ANNIVERSAIRE MINATO MIRAI Opened: December 3, 2012 (Monday) YOKOHAMA Address: Shinko 2-chome, Naka-ku, Yokoha
Slide 41: Entertainment Business FY3/13 Performance and FY3/14 Forecast
Entertainment Business FY3/13 Performance and FY3/14 Forecast
Slide 42: Karaoke Facility Features
Karaoke Facility Operations: Facility Types Facility Features: Facilities Based on a Clear Concept Various types of "communication space" Regular room Ladies’ room Family room Party room Online darts Japanese room Relaxing space for tomorrow's dynamism COTE D'AZUR, a karaoke and party facility that
Slide 43: Karaoke: FY3/13 Review of Operations
Karaoke Facility Operations: FY3/13 Review of Operations Sales and profits increased due to contributions from newly opened stores and cost control Operating profit/ Sales Operating margin (Millions of yen) (Millions of yen) Sales up 6.3% YoY 1,493 New store openings particularly in front of train 1
Slide 44: Karaoke: Conditions at Existing Stores
Karaoke Facility Operations: FY3/13 Review of Operations Conditions at Existing Stores Monthly trend in sales growth (%) 40 Sales Customer Jul-Aug: Dec-Jan: 30 Fewer salaried Customer traffic declined due Sales per customer to the London Olympic Games workers at night 20 and other events 10 0 -10 Ex
Slide 45: Karaoke: FY3/14 Earnings Forecast
Karaoke Facility Operations: FY3/14 Earnings Forecast Forecast sales and profit increase due to contributions from new store openings and maintaining sales at existing facilities Operating profit/ Sales Operating margin (Millions of yen) (Millions of yen) 18,000 1,750 1,680 16,700 Sales up 9.7% YoY
Slide 46: Café Complex Facility Features
Café Complex Operations: Facility Types Facility Features: Facilities Based on a Clear Concept For friends For singles and couples Reclining seat Massage seat Full flat seat Sofa seat For families and groups Pair flat seat Online darts Extreme relaxation close at hand Living room Café complex "KAIKA
Slide 47: Café Complex: FY3/13 Review of Operations
Café Complex Operations: FY3/13 Review of Operations Sales and profits increased due to higher sales at existing stores and contributions from new store openings Operating profit/ Sales Operating margin Sales up 17.1% YoY (Millions of yen) (Millions of yen) New store openings: 40 (+20 YoY) 17,112 Ch
Slide 48: Café Complex: Conditions at Existing Stores
Café Complex Operations: FY3/13 Review of Operations Conditions at Existing Stores Monthly trend in sales growth (%) 12 Sales Customers 10 Sales per customer 8 6 4 2 0 -2 -4 Existing-store sales up 2.0% Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr FY3/12 FY3/13 Apr May
Slide 49: Café Complex: FY3/14 Earnings Forecast
Café Complex Operations: FY3/14 Earnings Forecast Forecast sales and profit increase due to contributions from new store openings and higher sales at existing facilities Operating profit/ Sales Operating margin Sales up 16.3% YoY (Millions of yen) (Millions of yen) New store openings: 25 (1H: 15, 2H
Slide 50: Supplementary Documents
Supplementary Documents Notes on pages 51, 53 and 54: 1. Net income per share: Net income divided by average number of common shares outstanding (excluding treasury stock). 2. All amounts are rounded down to million yen. 3. The total operating profit for each segment and operating profit do not matc
Slide 51: FY3/13 Consolidated Business Results
FY3/13 Consolidated Business Results (Millions of yen unless otherwise stated) FY3/12 FY3/13 FY3/13 % % % YoY change YoY % Results Plan Results Sales 146,591 100.0 157,270 100.0 160,589 100.0 13,997 109.5 Fashion 94,252 100.0 100,700 100.0 103,932 100.0 9,679 110.3 Anniversaire/Bridal 23,437 100.0 2
Slide 52: FY3/13 Major Expenses
FY3/13 Major Expenses SG&A expenses (Millions of yen unless otherwise stated) FY3/12 Results FY3/13 Results Anniversaire/ Café Total Fashion Bridal Karaoke Total Fashion Anniversaire/ Bridal Karaoke Café Complex Complex YoY % YoY % YoY % YoY % YoY % Advertising expenses 10,397 8,398 1,275 417 111 11
Slide 53: First Half FY3/14 Consolidated Forecast
First Half FY3/14 Consolidated Forecast (Millions of yen unless otherwise stated) 1H FY3/13 Results % 1H FY3/14 Plan % YoY change YoY % Sales 67,425 100.0 73,290 100.0 5,864 108.7 Fashion 40,227 100.0 43,400 100.0 3,172 107.9 Anniversaire/Bridal 11,618 100.0 12,200 100.0 581 105.0 Karaoke 7,175 100.
Slide 54: FY3/14 Consolidated Forecast
FY3/14 Consolidated Forecast (Millions of yen unless otherwise stated) FY3/13 Results % FY3/14 Plan % YoY change YoY % Sales 160,589 100.0 175,800 100.0 15,210 109.5 Fashion 103,932 100.0 112,500 100.0 8,567 108.2 Anniversaire/Bridal 24,359 100.0 26,700 100.0 2,340 109.6 Karaoke 15,216 100.0 16,700
Slide 55: FY3/14 Major Expenses
FY3/14 Major Expenses SG&A expenses (Millions of yen unless otherwise stated) FY3/13 Results FY3/14 Plan Anniversaire/ Café Total Fashion Bridal Karaoke Total Fashion Anniversaire/ Bridal Karaoke Café Complex Complex YoY % YoY % YoY % YoY % YoY % Advertising 11,452 9,351 1,341 373 145 12,104 105.7 9
Slide 56: Reference: FY3/13 Fashion Business Performance
Reference: FY3/13 Fashion Business Performance (1) Change in existing-store sales (%) First half Oct. Nov. Dec. Jan. Feb. Mar. Second half Full year FY3/13 4.5 -4.8 14.8 0.0 3.5 5.3 13.3 6.0 5.4 FY3/12 0.2 1.3 -0.8 14.5 3.4 13.0 19.3 8.5 5.1 (2) Change in number of customers and sales per customer a
Slide 57: Sales by Category and Average Total Sales Area
(4) Sales by category (Millions of yen unless otherwise stated) FY3/12 Results % FY3/13 Results % YoY change YoY % Heavy clothing 46,010 48.8 49,018 47.2 3,007 106.5 Medium clothing 7,171 7.6 8,232 7.9 1,061 114.8 Light clothing 38,635 41.0 43,762 42.1 5,126 113.3 Other 2,434 2.6 2,916 2.8 481 119.8
Slide 58: Store Network by Prefecture
(6) Store network by prefecture (Number of stores) FY3/12 FY3/13 No. of stores at period-end No. of stores opened No. of stores closed No. of stores at period-end AOKI ORIHICA Total AOKI ORIHICA Total AOKI ORIHICA Total AOKI ORIHICA Total Hokkaido 15 15 4 4 1 1 18 18 Hokkaido/ Iwate 2 2 2 2 Tohoku A
Slide 59: Reference: FY3/14 Fashion Business Outlook
Reference: FY3/14 Fashion Business Outlook (1) Change in existing-store sales (%) First half Second half Full year FY3/14 (plan) 0.3 0.4 0.4 FY3/13 4.5 6.0 5.4 (2) Change in number of customers and sales per customer at existing stores (%) First half Second half Full year Number of customers FY3/14
Slide 60: Reference: FY3/13 Entertainment Business Performance
Reference: FY3/13 Entertainment Business Performance (1) Karaoke facility operations: Change in existing-store sales, number of customers and sales per customer at existing stores (%) First half Oct. Nov. Dec. Jan. Feb. Mar. Second half Full year Sales 0.5 -6.2 -0.3 -2.3 -1.5 2.5 -1.0 -1.6 -0.6 Numb
Slide 61: Café Complex Operations: Existing-store Sales and Customers
(3) Café complex operations: Change in existing-store sales, number of customers and sales per customer at existing stores (%) First half Oct. Nov. Dec. Jan. Feb. Mar. Second half Full year Sales 2.7 1.8 1.0 2.4 2.0 -0.6 1.4 1.4 2.0 Number of 2.4 2.3 0.5 2.4 1.4 -1.4 0.9 1.0 1.8 customers Sales per
Slide 62: Store Network by Prefecture
(5) Store network by prefecture (Number of stores) FY3/12 FY3/13 No. of stores at period-end No. of stores opened No. of stores closed No. of stores at period-end KAIKATSU KAIKATSU KAIKATSU KAIKATSU COTE D'AZUR Total Total Total Total CLUB COTE D'AZUR CLUB COTE D'AZUR CLUB COTE D'AZUR CLUB Hokkaido
Slide 63: Reference: FY3/14 Entertainment Business Outlook
Reference: FY3/14 Entertainment Business Outlook (1) Karaoke facility operations: Change in existing-store sales, number of customers and sales per customer at existing stores (%) First half Second half Full year FY3/14 (Plan) 0.0 0.0 0.0 Sales FY3/13 0.5 -1.6 -0.6 Number of FY3/14 (Plan) 0.0 0.0 0.