Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — FY2022 Earnings Presentation
65 slides from Komehyo's earnings presentation, May 2022
Slide 1: Earnings Results Briefing for the Fiscal Year Ended March 31, 2022
Earnings Results Briefing for the Fiscal Year Ended March 31, 2022 May 2022 Komehyo Holdings Co., Ltd. Securities code: 2780 (Tokyo and Nagoya Stock Exchanges) IR・PR Department TEL:+81-52-249-5366
Slide 2: Contents
Contents １．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 2
Slide 3: 1. Overview of Financial Results
１．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 3
Slide 4: FY 2022 Financial Summary
FY 2022 Financial Summary 【Brand・Fashion business】 ・Net sales increased 43.1% YoY and operating income also increased 570.3% YoY. Operating profit margin grew by 3.9pt YoY. ・Record high purchases from individuals due to store openings and purchase events, etc., with openings of 37 purchase centers (
Slide 5: Economic Trend
Economic Trend KOMEHYO's net sales are less susceptible to the impact of the COVID-19. 30,000 Nikkei Stock Average(monthly closing price)(yen) 20,000 Department store(fine arts/jewelry/precious metals)(10 millions of yen) KOMEHYO Net sales(Millions of yen) 6,000 5,000 4,000 3,000 2,000 1,000 The COV
Slide 6: Special factors of FY2022 (rising clock and gold prices)
Special factors of FY2022 (rising clock and gold prices) Rising watch prices (continued from October 2020) and rising gold prices (end of February to March 2022) in the reuse market have an impact as a "tailwind" for the brand and fashion business. Gold / Watch Bullion Impact of increased retail sal
Slide 7: FY 2022 Performance
FY 2022 Performance Net sales, operating Income, ordinary income, and net income all surpassed previous record highs. (Millions of yen) FY2020 FY2021 FY2022 Change YoY Net sales 57,510 50,723 71,148 20,425 140.3％ Gross profit 14,562 13,836 18,415 4,579 133.1％ Gross profit margin 25.3％ 27.3％ 25.9％ △1
Slide 8: FY 2022 quarterly results
FY 2022 quarterly results FY2021 FY2021 FY2021 FY2021 (Millions of yen) YoY YoY YoY YoY 1Q 2Q 3Q 4Q Net sales 14,162 180.1% 16,472 127.1% 19,237 127.1% 21,276 144.0% Gross profit 3,985 211.1% 4,215 124.5% 5,067 113.3% 5,147 125.8% Gross profit margin 28.1％ ＋4.1pt 25.6％ △0.5pt 26.3% △3.3pt 24.2％ △3.5
Slide 9: Changes in net sales
Changes in net sales Corporate sales of the Brand Fashion business remained strong and reached a record high. 71,148 Real estate leasing Tire and Wheel (Millions of yen) 57,510 50,960 50,723 45,903 45,497 43,199 40,212 40,134 Brand・Fashion FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY20
Slide 10: Changes in profit ratios
Changes in profit ratios Operating profit margin increased, despite a decline in the gross profit margin, offset by a decline in the SG&A expenses to sales ratio. Gross profit margin SG&A expenses to sales ratio Operating income margin （％） 31.4 30.5 28.5 27.8 28.5 27.1 27.3 25.3 25.9 25.7 26.1 24.9
Slide 11: Changes in expenses
Changes in expenses There were increases in selling expenses such as advertising expenses, as well as in personnel expenses such as salaries and allowances and recruiting costs. 14,265 14,700 (Millions of yen) 13,245 11,936 11,342 10,038 10,271 10,312 9,627 Administrative expenses Personal expenses
Slide 12: Changes in Operating income
Changes in Operating income Purchases from individuals remained strong and net sales increased. Operating income reached a record high thanks to expense control and other initiatives. Operating Income 7.5 7.2 Margin (%) 6.1 5.2 2,999 3.6 3.7 2.1 1.2 3,714 Real estate leasing 3,129 0.5 Tire and Wheel
Slide 13: Changes in ordinary income / net income
Changes in ordinary income / net income Both ordinary income and net income attributable to owners of parent hit record highs. ordinary income 3,772 3,162 Net income (Millions of yen) 2,988 attributable 2,742 to owners of parent 2,259 2,040 1,834 1,826 1,696 1,610 1,073 1,009 815 355 431 9 △ 234 △ 5
Slide 14: Changes in ROA/ROE
Changes in ROA/ROE A double-digit ROE was regained with the improvement of operating profit margin. 13.7 13.2 ROA ROE 11.7 （％） 11.1 12.9 12.8 9.7 6.3 6.1 9.8 3.3 5.8 5.2 1.2 0.0 2.0 △ 1.2 △ 3.2 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 14
Slide 15: Statement of Cash Flows
Statement of Cash Flows Cash flows from financing activities turned negative, and cash and cash equivalents decreased due to the repayment of debt 11,894 Cash and cash equivalents 10,738 (Millions of yen) 7,330 6,086 4,769 3,886 4,379 Cash flows from operating activities 1,715 2,113 1,447 1,651 1,35
Slide 16: Operating income increase and decrease factor
Operating income increase and decrease factor Purchases from individuals remained strong and net sales increased. Operating income grew significantly thanks to expense control and other efforts. Gross Profit margin decrease (Millions of yen) SG&A Expenses increase Sales amount increase Personal expe
Slide 17: Changes in selling, general and administrative expenses
Changes in selling, general and administrative expenses Ratio of SG&A expenses declined due in part to efficiency-oriented advertising. 26.1 24.8 SG&A expenses to sales ratio(%) 20.7 14,700 (Millions of yen) 14,265 13,245 5,714 5,610 Increase in general and administrative expenses 5,374 such as land
Slide 18: Non-operating income(loss) / Extraordinary income(loss)
Non-operating income(loss) / Extraordinary income(loss) Impairment loss 327 Interest expenses 52 Loss on retirement of fixed assets 152 Other 10 Loss due to temporary closure 14 Non-operating loss 62 Extraordinary loss 494 Non-operating income 120 Extraordinary income 48 (Millions of yen) Foreign ex
Slide 19: Balance sheet overview
Balance sheet overview (Millions of yen) FY2021 FY2022 Change Current assets 27,286 29,453 2,167 Cash and deposits 10,538 9,080 △1,458 →Decreased due to repayment of debt Products 12,649 15,277 +2,627 →Merchandise increased with improved purchases from individuals. Other current assets 4,097 5,096 +
Slide 20: Overview by segment
Overview by segment In the Brand Fashion business, both sales and profit increased thanks to strong purchases from individuals and the strong results of auctions for companies. Sales and profit also increased in the Tire and Wheel business owing to the strong sales of summer and winter tires. (milli
Slide 21: Changes in gross merchandise value
Changes in gross merchandise value GMV, which indicates the scale of our business, is an indicator of the promotion of relay use. GMV growth leads to business growth and improved profitability (Millions of yen) 51,077 40,778 41,097 39,071 36,420 31,926 32,962 27,692 FY2019 1H FY2019 2H FY2020 1H FY2
Slide 22: Breakdown of consolidated Net sales (Retail / Overseas)
Breakdown of consolidated Net sales (Retail / Overseas) The hybrid business of retail and corporate sales is balanced across the Group as a whole. Even including the third quarter, which is the busy season in Japan, the ratio of overseas sales remained steady at 10% of total sales. Overseas 9.6% Cor
Slide 23: Trends in Consolidated Net sales and Gross Profit Margin
Trends in Consolidated Net sales and Gross Profit Margin In 4Q, corporate sales with a low gross margin increased significantly, mainly reflecting the steep rise in gold market price. Gross profit margin(%) 29.6 27.5 27.7 28.1 25.9 26.1 25.6 26.3 24.0 24.3 24.0 24.2 Net Sales (Millions of yen) 19,23
Slide 24: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) Purchases from individuals remained favorable with the opening of Komehyo’s purchasing centers, the holding of KAITORI Go purchasing events, and an increase in the amount of purchases per customer. In particular, the purchase price of watches increase
Slide 25: Changes in corporate auction trade volume
Changes in corporate auction trade volume JBA auctions (particularly the offline auctions in Kanazawa) continued to be strong due to an increase in the number of registered members. The total volume of auctions among companies increased 40% YoY. Number of registered members 2,743 2,755 2,812 2,966 3
Slide 26: E-commerce-induced sales rate(KOMEHYO)
E-commerce-induced sales rate(KOMEHYO) While the infection situation of the new corona is settling down, the habit of shopping through EC has become established. The EC involvement rate increased by 3.9 points from 42.7% in the 21.3 period to 46.6% in the 21.3 period, and the target of 50% is just a
Slide 27: 2. Initiatives for the Fiscal Year
１．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 27
Slide 28: Stores: Group total 137 stores (As of March 2022)
Stores：Group total 137 stores（As of March 2022 ) Brand Fashion Tire and Wheel Flagship stores 5 － ２ 1 － － － Sales Stores － 2 － 6 2 － － Stores annexed with sales facilities 12 6 2 － － 10 4 Purchasing Center 59 － 10(FC2) － － － － Overseas 5 － 11 － － － － Total 81 8 25 7 2 10 4 BRAND OFF WORM OSAKA Shell
Slide 29: Opened stores in FY2022 (KOMEHYO/Purchasing centers)
Opened stores in FY2022（KOMEHYO/Purchasing centers） KOMEHYO opened 32 purchase centers in the fiscal year and achieved the goal of opening more than 30 stores per year. West Japan East Japan 4Q NIKKE COLTON PLAZA ARIAKE GARDEN 1Q HAKATA HANKYU 1Q HIBARIGAOKA PARCO HIROO AEON MALL IBARAKI SAPPORO TOK
Slide 30: Effect of opening the purchase center image (KOMEHYO)
Effect of opening the purchase center image (KOMEHYO) More than 30 purchase centers have been opened since the previous fiscal year, and 100 purchase centers will have been opened in the three years, in places where customers pass by daily. We are planning to increase purchase from individual custom
Slide 31: Product distribution image (KOMEHYO)
Product distribution image（KOMEHYO) ・Stores ・Stores ・Home delivery ・Suitable for retail ・Web Purchase from Purchasing Retail KOMEHYO ・Purchasing at individual customers website events 72.9％ 43.3％ Others ・Purchasing at website visited sites KOMEHYO Product center Quality Market price 25-30％ 35-45％ 25
Slide 32: Strengthening OMO that will continue from the previous term
Strengthening OMO that will continue from the previous term （KOMEHYO） WEB customer SNS service Purchase - sale Reserve Contact Center Membership One to One registration only customer service with a phone number Increase customer LTV CX Strategy including sale and purchase Live Commerce 32
Slide 33: Status of utilization by members (KOMEHYO)
Status of utilization by members (KOMEHYO) While the majority of members only purchase goods or only sell their goods at stores, there also exist those who both purchase and sell goods. The ratios of those who only buy and sell goods online are rising due to the OMO strategy and the openings of purc
Slide 34: Store development in the Ginza area
Store development in the Ginza area Ginza is an important area for strengthening retail sales. Expand stores as a group and expand contact points with customers. Future plans KOMEHYO GINZA store ● 東急プラザ銀座● Until late July KOMEHYO GINZA Limited （back order service and purchase by appointment only） ●ル
Slide 35: Assessment of authenticity and model numbers through AI
Assessment of authenticity and model numbers through AI The AI has been introduced to all KOMEHYO purchase centers. It will also be introduced to purchase centers of K-BRAND OFF (franchised stores). In the future, the AI is planned to be introduced to LINK SMILE by KOMEHYO and KAITORI Go purchasing
Slide 36: Human capital management (KOMEHYO)
Human capital management（KOMEHYO） In the business model of environmentally and socially conscious recycling, humans play a wide range of roles (knowledge, skills, expertise, speed, relationship with customers, etc.), making it important to take initiatives to develop and retain human resources. 36
Slide 37: Human resources development (KOMEHYO)
Human resources development（KOMEHYO） The number of female appraisers is rising steadily due to the systematization of training. Of the 84 stores in Japan, the number of female store managers and assistant managers increased to 18 stores. Number of appraisers Male Female FY2018 FY2022 0 100 200 300 3
Slide 38: Human resources retention rate
Human resources retention rate Employee turnover rate has been low, which means that the employee retention rate has been high. This enables to accumulate expertise, laying a foundation for stable growth. General regular workers(except part-time workers)(Ministry of Health,Laver and Welfare) Turnove
Slide 39: Format of auctions among companies
Format of auctions among companies KOMEHYO Auction and JBA complement each other in terms of area, date and format of the event. Frequency of corporate auctions Jewels / watches / Online auction 2 times/ month bags Apparel Online auction Monthly clothing JBA Real auction Monthly Kanazawa JBA Tokyo O
Slide 40: Corporate Auction (KOMEHYO Auction)
Corporate Auction（KOMEHYO Auction） Renewal of the member site from "bid method" to "auction method" Improving member convenience and making it a more attractive platform 1. Visualize pricing process through bid-up system 2. Increase bidding efficiency through simultaneous bids using the shopping car
Slide 41: Oversea (KOMEHYO Shanghai (CHINA))
Oversea（KOMEHYO Shanghai (CHINA)） KOMEHYO Shanghai now has three stores: Shanghai Isetan and Shanghai Takashimaya's limited-time stores have been converted to permanent stores, and a new store has been opened at LaLa Station (photo on the right). Shanghai Isetan Shanghai Takashimaya's LaLa station S
Slide 42: Tire and Wheel
Tire and Wheel Both sales and profit increased as CRAFT focused its efforts on selling summer and winter products and custom products such as suspension. Moreover, 4×4 Engineering Services released new products. 42
Slide 43: 3. Medium-term Management Plan
１．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 43
Slide 44: Medium-term management target (until FY2025)
Medium-term management target (until FY2025) FY2023 FY2024 FY2025 (Millions of yen) 1H Full year Full year Full year Net sales 35,500 78,000 85,000 100,000 Operating income 1,160 3,780 4,400 5,500 Operating profit margin 3.3％ 4.8％ 5.2% 5.5% Ordinary income 1,020 3,780 4,400 5,500 Net income attribut
Slide 45: Sales plan
Sales plan 100,000 (Millions of yen) 85,000 78,000 71,148 57,510 50,960 50,723 45,903 45,497 43,199 40,212 40,134 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 45
Slide 46: Operating Profit Plan
Operating Profit Plan 7.5 7.2 Operating Income 6.1 Margin (%) 5.2 5.2 5.5 4.8 3.6 3.7 2.1 1.2 0.5 5,500 4,400 Operating Income 3,780 3,714 (Millions of yen) 2,999 3,129 2,789 1,860 1,625 590 297 832 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 46
Slide 47: Ordinary income/Net income Plan
Ordinary income/Net income Plan 5,500 Net income attributable to owners of (Millions of yen) parent 4,400 3,772 3,780 3,450 3,162 Ordinary 2,988 2,742 income 2,850 2,450 2,259 2,040 1,834 1,826 1,696 1,610 1,073 1,009 815 355 431△ 595 9 △ 234 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 F
Slide 48: Medium-term management plan: Continuous business expansion
Medium-term management plan: Continuous business expansion through investments in growth businesses and human resource development Brand Fashion BtoC BtoB Oversea １．Achieving growth with existing core businesses ２．Achieving growth with businesses that contribute to the distribution of used goods to
Slide 49: Growth in the brand reuse market image
Growth in the brand reuse market image Important investment items ③Businesses that contribute to distribution ・Human resource recruitment and development ・Stores (openings/reorganization) ・IT (reuse technologies) ②Businesses that contribute to market growth ・Marketing ・Sustainability Businesses base
Slide 50: Medium-term Management Plan: Brand・Fashion
Medium-term Management Plan : Brand・Fashion Gaining more influence in the reuse market by making maximum use of the Group's assets １．Achieving growth with existing core businesses ＝Domestic＝ ・Increasing the number of purchasing channels (continuing to open purchase centers and strengthening alliance
Slide 51: Medium-term Management Plan: Brand・Fashion
Medium-term Management Plan : Brand・Fashion Gaining more influence in the reuse market by making maximum use of the Group's assets ２．Achieving growth with businesses that contribute to the distribution of used goods to revitalize the market ・Auctioning more items through franchise development (openi
Slide 52: Medium-term Management Plan: Tire・Wheel
Medium-term Management Plan : Tire・Wheel Expanding the business by strengthening profitability and investing in growth drivers １．Strengthening profitability through collaboration among the three companies ・Strengthening and opening specialty stores developed according to customer preference ・Strengt
Slide 53: 4. Shareholder return
１．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 53
Slide 54: Shareholder return
Shareholder return Aiming to increase dividends consistently in line with the status of profit and cash flow 92.4 Payout ratio(%) 36.2 29.3 30.6 34.7 24.8 23.0 19.4 19.7 16.6 15.5 15.0 15.5 (planned) Fiscal year-end dividend 22 Interim dividend 15 15 15 16 20 14 8 15 8 10 8 5 7 22 7 14 15 15 15 16 1
Slide 55: 5. Company Profile, etc.
１．Overview of Financial Results for the Fiscal Year Ended March 31, 2022 ２．Initiatives for the Fiscal Year Ended March 31, 2022 ３．Medium-term Management Plan ４．Shareholder return ５．Company Profile, etc. 55
Slide 56: Corporate Profile
Corporate Profile Company name Komehyo Holdings Co., Ltd. Established May 1979 ※Transition to holding company system in October 2020 Head Office 3-25-31 Osu, Naka-ku, Nagoya Representative President, Representative Director: Takuji Ishihara Capital 1,803 million yen No. of Consolidated: 967 Non-cons
Slide 57: Mission
Mission Komehyo Holdings is necessary for a sustainable recycling society. It acts as a relay point in the connection of “people,” “things,” and “society.” We will strive to connect “good quality" and "value" to the future. We respect people for making products, thank people for providing products f
Slide 58: Corporate History
Corporate History ●Acquired Eve Corporation Co.,Ltd. ●Established Auto Parts KOMEHYO (currently AUTO PARTS JAPAN) ●Established KOMEHYO HONG KONG LIMITED ●Transition to a holding ● Acquired CRAFT Co., Ltd. company structure ●Established KOMEHYO Auction ●Opened the second store in Bangkok, ●Opened KOM
Slide 59: From reuse to relay use
From reuse to relay use We will inherit that "value". Maintenance, remake, editing, connection with people. "Relay youth" is not just a downcycle of the value of things, but an upcycle of increasing the value, even though it is reused. As values for a sustainable future society spread, we will contr
Slide 60: KOMEHYO HD Group materiality (important issue)
KOMEHYO HD Group materiality (important issue) Work on four tasks of purchase, sales, appraisal, and restoration to realize the circulation of value through environmentally and socially conscious recycling, in pursuit of both promotion and growth of reuse and value improvement of used goods. Purchas
Slide 61: A value chain where value circulates through relay use
A value chain where value circulates through relay use Developing the reuse market further Making reuse a common practice in society Contributing to the development of the reuse market by proposing quality Making it a common practice to sell goods which will no longer be used items, taking advantage
Slide 62: Corporate governance system
Corporate governance system The Group's management efficiency 取締役 and business performance are aimed (監査等委員を除く) 3名 at respecting the interests of not only shareholders, but also employees, customers, business partners, creditors, local communities, and other people who have great influences and inte
Slide 63: Officer system
Officer system Name Takuji Ishihara Toshio Sawada Yuya Yamauchi Kazutoshi Torita Momoko Murase Miyuki Minamiru President and Director (Audit and Director (Audit and Director (Audit and Position Representative Managing Director Director Supervisory Supervisory Supervisory Director Committee Member) C
Slide 64: Business system diagram
Business system diagram purchase Sales General customers, etc. Stores Stores General customers, etc. Home delivery Purchasing WEB Purchasing at Auction Used goods business events Purchasing at visited sites Used goods business New and used goods business Auctions by other companies 64
Slide 65: IR contact
IR contact IR・PR Department Phone：+81-52-249-5366 E-mail：ir@komehyo.co.jp Note: This document is an English translation of a document prepared in Japanese. Statements in this document that are not historical facts; statements concerning current plans, forecasts, strategies, and opinions of KOMEHYO C