Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — Q2 FY2024 Earnings Presentation
41 slides from Komehyo's earnings presentation, Nov 14, 2023
Slide 1: Earnings Results Briefing for the Second Quarter of the Fiscal Year Ending March 31, 2024
Earnings Results Briefing for the Second Quarter of the Fiscal Year Ending March 31, 2024 November 14, 2023 Komehyo Holdings Co., Ltd. Securities code: 2780 (Tokyo Stock Exchange and Nagoya Stock Exchange)
Slide 2: 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 3: Komehyo Holdings is necessary for a sustainable recycling society
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 for use b
Slide 4: Competitive Advantages of the KOMEHYO Holdings Group
Competitive Advantages of the KOMEHYO Holdings Group Since its founding, the Group has consistently worked on reuse. Developing Business with Three Competitive Advantages. Talent retention rate of In order to acquire a wealth of product More than 1.7 million brands and In addition to trust and secur
Slide 5: Contents
Contents 1. Overview of Financial Results for First Six Months of P.６ the Fiscal Year Ending March 31, 2024 2. Initiatives for First Six Months of the Fiscal Year P.25 Ending March 31, 2024 3. Future outlook P.36 5
Slide 6: 1. Overview of Financial Results for First Six Months
1. Overview of Financial Results for First Six Months of P.６ the Fiscal Year Ending March 31, 2024 2. Initiatives for First Six Months of the Fiscal Year P.25 Ending March 31, 2024 3. Future outlook P.36 6
Slide 7: FY 2024 2Q Financial Summary
FY 2024 2Q Financial Summary Brand・Fashion busines Tire and Wheel buisiness Net sales Operating income Purchase from individual customers Net sales Operating income 50,800 3,125 28,989 1,940 6 Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen （YoY136.1％） （YoY180.4％） （Yo
Slide 8: Brand fashion business 2Q progress
Brand fashion business 2Q progress Purchasing was also strong in 2Q. Corporate purchasing remain strong, and was particularly noticeable with bags, as buyers sought to secure popular items while maintaining well-balanced purchases. Although retail sales remained strong, with no significant increase
Slide 9: Changes in average purchaser unit price by product
Changes in average purchaser unit price by product（Komehyo Co., Ltd.） The unit purchase price per individual customer is on the rise, reflecting stronger sales of bags against the backdrop of inbound demand, clothing with a stronger strategic focus on items with a high unit price, and aggressive pur
Slide 10: FY 2024 2Q Performance
FY 2024 2Q Performance Record sales and profit at every level in the 1H period. (Millions of yen) FY2024 1Q YoY FY2024 2Q YoY FY2024 1H YoY vs FY plan※ Net sales 25,096 133.8% 27,667 135.2% 52,764 134.5% 49.8% Gross profit 6,592 139.7% 6,698 131.5% 13,291 135.5% ー Gross profit margin 26.3% ＋1.1pt 24
Slide 11: Operating profit increase and decrease factor
Operating profit increase and decrease factor Net sales increased, reflecting enhanced purchasing of popular products from corporations in addition to strong purchases from individual customers. Operating income increased significantly as SG&A expenses progressed as planned. (Millions of yen) Increa
Slide 12: Changes in selling, general and administrative expenses
Changes in selling, general and administrative expenses Hiring and training was strengthened to secure the staff needed to open stores, resulting in higher personnel expenses. The SG&A to net sales ratio declined as SG&A expenses progressed as planned in relation to net sales growth. SG&A expenses t
Slide 13: Active investment in human resources
Active investment in human resources（FY2024 1H Komehyo Co., Ltd.） Promoting the creation of a rewarding work environment, including giving back to employees in line with business growth. Aggressively invest in human resources, particularly in hiring and training, with a view to continued growth for
Slide 14: Non-operating income(expenses) / Extraordinary income(losses)
Non-operating income(expenses) / Extraordinary income(losses) Non-operating (Millions of yen) expenses41 Interest expenses32 Extraordinary losses66 Rent expenses Impairment losses39 on store4 Loss on retirement of Other4 non-current assets26 Non-operating income101 Extraordinary Foreign exchange gai
Slide 15: Balance sheet overview
Balance sheet overview (Millions of yen) FY2023 FY2024 1H Change Current assets 35,322 45,695 10,373 Cash and deposits 10,382 11,689 1,306 Inventories 18,705 25,837 7,132 →Inventories increased due to strong Individual purchases Other current assets 6,234 8,168 1,934 Non-current assets 11,430 12,558
Slide 16: Inventory Turnover (Brand・Fashion business)
Inventory Turnover（Brand・Fashion business） Inventory was properly supplied and prices were adequately controlled by utilizing multiple sales channels while taking into account market prices and foreign exchange rates.This led to an improvement in the ratio of gross profit to inventory investment (gr
Slide 17: Cash Flow trend
Cash Flow trend Operating cash flow decreased partly due to an increase in inventories in preparation for a busy season in the second half of the fiscal year. Purchase from individual customers were strong, short-term borrowings increased, and financing cash flow increased significantly. Cash and ca
Slide 18: 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) GMV is calculated simply by adding and subtracting sales and volume information at the K
Slide 19: Overview by segment
Overview by segment In the Brand Fashion business, purchases from individuals and retail were strong. In the Tire and Wheel business, only sales of new products performed solidly. (Millions of yen) FY2024 1Q YoY FY2024 2Q YoY FY2024 2Q 1H YoY Net salesc 24,075 135.3% 26,724 136.9% 50,800 136.1% Bran
Slide 20: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) In addition to an increase in the number of customers due to the continued opening of purchase center and other factors, the amount of purchases per customer remained strong. Record purchase price for the quarter. Purchase from individual customers (G
Slide 21: Breakdown of consolidated Net sales
Breakdown of consolidated Net sales (Retail / Overseas/Domestic tax-free sales) 【Retail】The retail ratio increased due to the strengthening of the retail business, achieving the ideal composition ratio（Retail: Corporate sales = 50:50） 【Overseas】Overseas sales were also healthy following the transfer
Slide 22: Breakdown of domestic duty-free sales
Breakdown of domestic duty-free sales 【 Composition ratio by country/region 】Customers in China increased 8.4 pt from 1Q, accounting for nearly 80% of total customers in the top 5 countries. 【Percentage of purchasers by age group】They are younger than the domestic customer base, with the volume zone
Slide 23: Quarterly Trends in Consolidated Net Sales and Gross Profit Margin
Quarterly Trends in Consolidated Net Sales and Gross Profit Margin 【Net sales】Sales increased in both retail and corporate sales due to strong individual purchases. 【 Gross Profit Margin 】In order to secure popular products such as bags, we also strengthened corporate purchasing with low gross profi
Slide 24: Shareholder return
Shareholder return The policy is to aim for a dividend payout ratio of 20%. Taking into consideration the profit forecast level for the fiscal year ending March 31, 2024, the annual dividend for the fiscal year ending March 31, 2024 was revised from the initial plan of 76 yen to 88 yen (an increase
Slide 25: 2. Initiatives for First Six Months
1. Overview of Financial Results for First Six Months of P.６ the Fiscal Year Ending March 31, 2024 2. Initiatives for First Six Months of the Fiscal Year P.25 Ending March 31, 2024 3. Future outlook P.36 25
Slide 26: FY 2024 2Q Initiative Summary
FY 2024 2Q Initiative Summary ・Opened 11 purchasing stores. We are making progress in securing properties and expect to be able to achieve our full-year target of opening 30 to 40 stores. ・Although individual purchases continue to be strong, the large-scale purchasing store “KOMEHYO SHIBUYA” schedul
Slide 27: Stores: Group total 201 stores
Stores：Group total 201 stores（As of September 2023) *The figure in parentheses ( ) represents the increase during the first quarter. *USED MARKET converted to KOMEHYO brand KOMEHYO is making progress in securing properties and is expected to achieve its full-year target of opening 30 to 40 stores. B
Slide 28: Opening the purchase center
Opening the purchase center The amount of purchase per store remained strong. The store openings added 3.9 billion yen.(1.5 billion yen during the fiscal year) to the annual purchase amount.Signboard effect from new store openings had a positive impact on existing stores. In the 1H, 17 purchasing ce
Slide 29: Product distribution (FY2024 1H)
Product distribution（FY2024 1H） Purchasing quality/market/distribution sale YoY YoY ▲6pt ▲2pt Purchase from individual customers 72％ KOMEHYO 41％ Retail Merchandise center Stores/Home delivery Purchasing/Purchasing at events/ Store Purchasing at visited sites WEB（company,Other company,live commerce）
Slide 30: E-commerce-induced sales rate
E-commerce-induced sales rate（FY2024 1H Komehyo Co., Ltd.） In addition to an increase in the number of customers, the per-customer spending rose, resulting in e-commerce-induced sales of 122% YoY, a record high for the quarter. E-commerce-induced sales rate was at just under 40% due to rising sales
Slide 31: Partnered with CtoC platform Rakuten Rakuma
Partnered with CtoC platform Rakuten Rakuma（FY2024 1H Komehyo Co., Ltd.） In partnership with Rakuten RAKUMA, a flea market application, the two companies have agreed to jointly provide a "RAKUMA Appraisal Service" on a trial basis from September 2023, allowing users who have purchased an item to req
Slide 32: BRAND OFF Strengthen retail
BRAND OFF Strengthen retail ‣Strengthening retail The flagship BRAND OFF Ginza main store, which relocated and opened in October 2022, as well as stores in Hong Kong and Taiwan continue to perform well. Renovate retail stores in Japan and overseas and open new stores to strengthen contacts with new
Slide 33: BRAND OFF FC purchase store opened
BRAND OFF FC purchase store opened ▶Continue opening franchise stores Planning to open 40 stores in FY03/24. Items purchased at franchise purchase centers are put to auction (JBA). The trade volume thus increases. Product commercialization General customers General customers FC Exhibit General custo
Slide 34: Corporate auction volume
Corporate auction volume JBA auctions, particularly offline auctions in Kanazawa, displayed strength due mainly to an increase in the number of registered members. The total trading volume of corporate auctions increased 121% year on year, hitting a record high. Number of registered menmbers Trade v
Slide 35: Tire and Wheel
Tire and Wheel Strengthening of used product sales and strong online sales of summer tires. AUTO PARTS JAPAN ・The number of used purchases at Kraft stores was ・Sales of summer tires increased by 307% ・Domestic sales grew 112% YoY, thanks to strong, up 115% YoY. Good quality inventories of year-on-ye
Slide 36: 3. Future outlook
1. Overview of Financial Results for First Six Months of P.６ the Fiscal Year Ending March 31, 2024 2. Initiatives for First Six Months of the Fiscal Year P.25 Ending March 31, 2024 3. Future outlook P.36 36
Slide 37: Medium-term management target (Until FY2026)
Medium-term management target(Until FY2026) For the fiscal year ending March 31, 2024, the performance forecast as of August 14 will remain unchanged as the results of the 3Q will have a significant impact on the full-year results. Plans for fiscal year ending March 31, 2025 onwards will be announce
Slide 38: Brand and Fashion business 2H assumption
Brand and Fashion business 2H assumption Based on the forecasted market trend of mainstay products, we expect purchasing and net sales to remain steady in 2H, and gross profit margin to be in line with our plan. The forecasted market trend of mainstay products, Forecast for 2H Jewelry ・Continue to s
Slide 39: Opening of large store KOMEHYO SHIBUYA
Opening of large store “KOMEHYO SHIBUYA” KOMEHYO SHIBUYA, a large-scale sales store with purchase attached, will open on November 17, 2023. Strengthening of retail sales on the back of strong purchases. Targeting domestic and international fashion connoisseurs, mainly Generation Z and Y, the company
Slide 40: Future overseas expansion
Future overseas expansion To prepare for growth in Japan and business expansion in overseas cities and areas, the two consolidated subsidiaries in Hong Kong are scheduled to be integrated in March 2024. With the aim of bolstering Hong Kong's local brand fashion business and accelerating the developm
Slide 41: 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