Autobacs Seven Co., Ltd. · TSE:9832
Autobacs Seven — FY March 2015 Earnings Presentation
54 slides from Autobacs Seven's earnings presentation, May 11, 2015
Slide 1: Results for FY March 2015 and Forecasts for FY March 2016
ANALYST MEETING Results for FY March 2015 and Forecasts for FY March 2016 May 11, 2015 Setsuo Wakuda Representative Director and CEO AUTOBACS SEVEN CO., LTD.
Slide 2: Contents
Contents I. FY March 2015 Consolidated Results II. FY March 2016 Consolidated Forecast III. Revision of “2014 Medium-term Business Plan” 1
Slide 3: I. FY March 2015 Consolidated Results
I. FY March 2015 Consolidated Results 2
Slide 4: Consolidated Results (FY March 2015)
Consolidated Results (FY March 2015) Decrease in net sales and income: sales decreased more than expected due to a reactionary fall from the last-minute rise in demand before the consumption tax hike and a slump in consumer sentiment. Profits declined as a result of reduced sales, despite having str
Slide 5: Overview of the 2nd-half Results (FY March 2015)
Overview of the 2nd-half Results(FY March 2015) Financial results were below both the planned targets and the previous year. Sluggish consumption continued for longer than expected, and sales failed to reach the target. Gross margin declined largely owed to the above sales drop, despite of the effor
Slide 6: Retail Sales Trend (FY March 2015)
Retail Sales Trend (FY March 2015) Same store sales and number of customers at domestic AUTOBACS-chain stores including FCs (YoY) Sales Number of customers 0% -2.7% -3.1% -2.2% -6.1% -6.0% -6.0% -5.0% -5.8% -5% -3.3% -7.7% -8.8% -8.6% -5.1% -10% -8.2% -6.5% -8.7% -9.0% -8.7% -9.9% -10.2% -15% -16.7%
Slide 7: Domestic Retail Sales (FY March 2015)
Domestic Retail Sales (FY March 2015) (Billion Yen) Sales at domestic AUTOBACS-chain stores including FCs*: 266.3 billion yen 350 -9.9% YoY Automotive goods and services: 295.4 222.1 billion yen, -11.5% YoY 300 266.3 Automotive purchase and sales: 250 23.0 billion yen, -0.3% YoY 23,934 cars, +3.4% Y
Slide 8: Sales Variance by Merchandise (FY March 2015)
Sales Variance by Merchandise (FY March 2015) 【Same store basis】 Sales: -11.0% YoY, Number of customers: -7.1% YoY Sales* changes by merchandise category (Million Yen） (YoY change in amount; total store basis) 0 -10 -40 -370 All-season tires: -6,340 MY -1,000 -680 Snow tires: -1,250 MY -1,100 -1,290
Slide 9: ASP of Car Navigation Devices at Stores
ASP of Car Navigation Devices at Stores Sales* and ASP of navigation devices (YoY) Others PND Built-in Built-in ASP PND ASP Billion Yen (yoy) 50 0% 45 -2.4% 1.4 1.1 40 -5% -5.8% 11.2 10.2 -7.0% 35 0.9 30 -10.0% -9.7% -10% 7.4 0.6 -9.7% 25 6.2 0.8 20 4.3 -15% -16.0% -16.0% 15 31.2 31.4 -16.3% -18.9%
Slide 10: Major Drivers Of Variance (FY March 2015)
Major Drivers Of Variance (FY March 2015) FY March 2015 FY Mar 2014 Result YoY % of Major drivers of variance % of Sales change Sales Net sales 209.4 BY -9.6% Non-consolidated: -16.92 BY Values before consolidation 231.6 Domestic store subsidiaries: -13.5 BY adjustments Overseas store subsidiaries:
Slide 11: Operating Income Components (FY March 2015)
Operating Income Components (FY March 2015) Domestic AUTOBACS-chain store sales Total store basis: -9.9%／ same store basis: -11.0% Operating income (Million yen) Amount Major drivers of variance (yoy) Non-consolidated 8.83 BY -4.49 BY Net sales -16.93 BY (-9.2%) Gross Profit -4.32 BY (GM 20.7% (last
Slide 12: Measures for AUTOBACS Business (FY March 2015)
Measures for AUTOBACS Business (FY March 2015) Business field Measures taken Automotive 1. Did not open new stores if difficult due to the increased cost of goods and opening stores services 2. Did not reach the target due to reduced demand and fewer stores despite the implementation of a new privat
Slide 13: Private Brand Merchandise (FY March 2015)
Private Brand Merchandise (FY March 2015) “AQ. AUTOBACS QUALITY.” Unifying the brand design and concept of private brand items. Expanding the merchandise lineup. Brand concept is “Comfortable and high quality.” Implemented merchandise: batteries, car accessories (mirror, floor mat, air refresher, ca
Slide 14: E-commerce, Omni-Channel Strategy (FY March 2015)
E-commerce, Omni-Channel Strategy (FY March 2015) Net sales for FY March 2015 :1.63 billion yen (up 19.5% YoY) Direct delivery to customers: 0.71 billion yen Store sales: 0.92 billion yen ・Increasing merchandise line-up ・Improving the system for easy-to-buy ・Strengthening the promotion for WEB chann
Slide 15: Store Openings And Closings (FY March 2015)
Store Openings And Closings (FY March 2015) Domestic stores No. of FY March 2015 No. of stores at stores at Store Type March 31, 1st-half 2nd-half March 31, 2014 New S/B・R/L Close New S/B・R/L Close 2015 AUTOBACS 478 +7 +6 491 Super AUTOBACS 75 75 AUTOBACS Secohan Ichiba 10 10 AUTOBACS EXPRESS 8 8 To
Slide 16: Reorganization of Store Subsidiaries (FY March 2015)
Reorganization of Store Subsidiaries (FY March 2015) Measures Contents Change of - Changed presidents at seven domestic store subsidiaries managements Transfer of shares of - Transferred all shares of a store subsidiary in Kanagawa store subsidiaries to a franchisee (include transfer of four stores)
Slide 17: Performance by Countries (FY March 2015)
Performance by Countries (FY March 2015) FRANCE CHINA SINGAPORE THAILAND Number of stores at March 31, 2014 11 0 3 5 -including FC stores- Same store sales -3.1% ─ -9.9% -22.9% -including FC stores- FY March FY March FY March FY March FY March FY March FY March FY March Period 2015 2014 2015 2014 20
Slide 18: Measures for Overseas Business (FY March 2015)
Measures for Overseas Business (FY March 2015) FY March 2015 Areas with • Closed unprofitable stores (all stores closed in existing stores China) • Reduced inventory • Reduced excess personnel • Opened small stores in Thailand New areas • Founded a subsidiary in Malaysia • Prepared for new store ope
Slide 19: New stores in Thailand -small format- (FY March 2015)
New stores in Thailand -small format- (FY March 2015) AUTOBACS KHUBON Store AUTOBACS ROM KLAO Store (Opening date: October 17, 2014) (Opening date: February 26, 2015) AUTOBACS NAWAMIN Store (Opening date: April 9, 2015) 18
Slide 20: Acquisition of Car Dealer -BMW / MINI- (FY March 2015)
Acquisition of Car Dealer -BMW / MINI- (FY March 2015) Name of companies acquired: Autoplatz K.K., Autoplatz Moters K.K. Name of stores: Ikebukuro BMW and MINI Ikebukuro (official dealer of BMW) Beginning of operation: April 1, 2015 Purpose: start of the dealer business of new cars training of the h
Slide 21: II. FY March 2016 Consolidated Forecasts
II. FY March 2016 Consolidated Forecasts 20
Slide 22: Financial Forecasts (FY March 2016)
Financial Forecasts (FY March 2016) (Billion Yen) FY March 2016 (Forecast) FY March 2015 Result YoY change 1st-half 2nd-half Full year (amount & rate) Net sales 209.4 102.8 118.9 221.7 +5.8% Gross profit 66.9 32.5 38.7 71.2 +6.4% % to Net sales 31.9% 31.6% 32.5% 32.1% +0.2pt SG&A 60.4 30.3 30.9 61.2
Slide 23: Preconditions for the Financial Plan of FY March 2016
Preconditions for the Financial Plan of FY March 2016 Business Environment • Prices in Japan rises due to weaker yen and thrifty consumer behavior. • Demand for automobiles declines by 5.4% year on year (Japan Automobile Manufacturers Association, Inc.). • Demand for commercial tires in 2015 decline
Slide 24: Guideline of FY March 2016 forecasts
Guideline of FY March 2016 forecasts Domestic AUTOBACS-chain stores including FCs Same store sales: YoY +4.1%, Total stores sales: YoY +4.6% + Rebound of consumption tax hike - Influence of the decrease of new car sales + Increase of inspection, automobile purchase and sales business + Increased sal
Slide 25: Forecast at Parent & Subsidiary Level (FY March 2016)
Forecast at Parent & Subsidiary Level (FY March 2016) (Million Yen) FY March FY March 2016(Forecasts) 2015 YoY change results 1st-half 2nd-half Full Year (amount) Non-consolidated Net sales 166,828 80,000 93,000 173,000 +3.7 Ordinary 8,836 4,000 7,000 11,000 +24.5 income Domestic store Net sales 67,
Slide 26: Statutory Safety Inspection and Automobile Purchase and Sales Business
Statutory Safety Inspection and Automobile Purchase and Sales Business Statutory safety inspection Automobile purchase and sales (total stores) (Thousands cars) (total stores) (Thousands cars) 700 30 28.0 620 589 600 573 580 23.9 535 25 23.1 498 500 20 17.9 18.4 400 16.2 15 300 10 200 100 5 0 0 Marc
Slide 27: New Store Openings
New Store Openings Number of stores New Store Openings in Domestic Market 650 597 600 584 14 571 13 546 25 550 513 30 23 500 450 400 350 300 Mar 2012 Mar 2013 Mar 2014 Mar 2015 Mar 2016（E） New Stores Total number of stores 26
Slide 28: Capital Expenditures & Depreciation
Capital Expenditures & Depreciation Capital Expenditures Depreciation (Billion Yen) (Billion Yen) 9.0 7.0 Full year estimate 8.0 7.69 7.66 6.0 Full year 7.0 4.92 estimate 6.25 6.12 5.0 4.60 4.57 4.50 6.0 4.42 4.30 4.81 4.0 5.0 4.0 3.0 3.19 3.0 2.0 2.0 1.0 1.0 0.0 0.0 March March March March March Ma
Slide 29: Financial Strategies – Shareholder Return Policy
Financial Strategies – Shareholder Return Policy FY March 2015 Dividends: interim 30 yen/ share, Year-end 30 yen/ share, annual total 60 yen/ share Share buy-back: 5.05 billion Yen, 3,000,000 shares FY March 2016 (Forecast) Dividends: interim 30 yen/ share, Year-end 30 yen/ share Share buyback: up t
Slide 30: III. Revision of “2014 Medium-term Business Plan”
III. Revision of “2014 Medium-term Business Plan” 29
Slide 31: Outlook of Business Environment
Outlook of Business Environment • The consumption trend remains unstable in the medium term. • Numbers of K-cars and environmentally-friendly automobiles continue to increase. • Inter-industry competition and alliances increases. • The automotive goods market to shrink, while the maintenance and use
Slide 32: Revision of “2014 Medium-term Business Plan” (1)
Revision of “2014 Medium-term Business Plan”（１） 2014 Medium-term Business Revised 2014 Medium-term Plan announced last year Business Plan Basic Policy Improving Profitability of AUTOBACS Business and Creating New Business for Growth (No Change) AUTOBACS Group is establishing three growth pillars for
Slide 33: Business Strategy of Domestic AUTOBACS Business
Business Strategy of Domestic AUTOBACS Business Focus on the business of statutory safety inspection and maintenance services which is expected to build strong relationship with customers 1. Increase sales of oil, etc. to Maintenance maintenance membership holders membership holders 2. Enhance the p
Slide 34: Revision of “2014 Medium-term Business Plan” (2)
Revision of “2014 Medium-term Business Plan”（2） 2014 Medium-Term Business Revised 2014 Medium-Term Plan announced last year Business Plan Domestic Business basic policy (No Change) AUTOBACS Creating higher value for customers and establishing competitive Business advantage Enhancing Customers’ Conve
Slide 35: Revision of “2014 Medium-term Business Plan” (3)
Revision of “2014 Medium-term Business Plan”（3） 2014 Medium-Term Business Revised 2014 Medium-Term Plan announced last year Business Plan Overseas 1. Develop business, especially in the ASEAN region through Business partnerships with local companies (No Change) 2. Target business of not only retail
Slide 36: Improvement in the Process of Value Chain Process
Improvement in the Process of Value Chain Process Place customer Reduce Empower PB reference counter distribution costs branding by unifying the Continue Build stores and operations design & purchase that improves customer concept reforms communication Assortment Merchandise Purchase/ After-sales Di
Slide 37: Overseas Business
Overseas Business Measures for the FY ending March 2016 Areas with • Relocate unprofitable stores existing stores • Review price and gross margin • Change suppliers • Continue to open stores in Thailand • Develop B2B business New areas ・ Start opening stores in Malaysia and Indonesia Other • Continu
Slide 38: Today’s Summary
Today’s Summary FY March 2015 - Demand for car goods declined due to last-minute buying before the consumption tax hike and low consumer sentiment. - Company worked to develop a fundamental for its future growth by strengthening its automobile purchase and sales network, unifying the design and conc
Slide 39: Appendix
Appendix 38
Slide 40: Sales Trend: Retail & Wholesale (Apr 2014 – Mar 2015)
Sales Trend: Retail & Wholesale (Apr 2014 – Mar 2015) （％） 【YoY change for the last 12 months】 10.0 Sales Wholesale 4.6 5.0 0.4 0.0 -1.0 -5.2 -3.9 -5.0 -6.1 -1.5 -5.0 -7.3 -7.1 -5.6 -8.7 -7.5 -7.7 -10.0 -7.1 -8.1 -8.4 -8.2 -15.7 -15.0 -20.5 -20.0 Fall from the last-minute demand before the tax hike -
Slide 41: Quarterly P/L (FY March 2015)
Quarterly P/L (FY March 2015) (Billion Yen) Full Year Q1 (Result) Q2 (Result) Q3 (Result) Q4 (Result) (Result) Net sales 48.4 49.5 69.8 41.5 209.4 YoY - 7.5% - 3.4% - 6.2% - 22.3% - 9.6% Gross profit 14.8 15.7 22.2 14.1 66.9 % of Sales 30.6% 31.8% 31.8% 34.0% 31.9% YoY - 13.0% - 10.5% - 7.5% - 22.7
Slide 42: Segment Information
Segment Information (Million Yen) FY March FY March YoY Latest % to 2015 result 2014 result Change Forecast Forecast Net sales 166,828 183,758 - 9.2 175,800 - 5.1 Non-consolidated Operating income 8,836 13,330 - 33.7 107 - 17.4 Net sales 67,883 81,391 - 16.6 69,700 - 2.6 Domestic store subsidiaries
Slide 43: Decrease in Consolidation Adjustments
Decrease in Consolidation Adjustments Consolidation Adjustments (Million Yen) FY Mar 31, 2015 FY Mar 31, 2014 Operating income for segment total 7,216 14,585 Inventories (Unearned income of subsidiary inventories, etc.) (346) (253) Depreciation of goodwill (190) (105) Allowance for point card (24) (
Slide 44: Performance Breakdown (FY Mar 31, 2015)
Performance Breakdown (FY Mar 31, 2015) Non-consolidated Net sales -16.72 BY ↑ car sales, services, fuel, etc. Wholesale -9.5% ↓ car electronics devices, tires & wheels, car interior items, etc. 166.8 BY -0.14 BY ↑ services, on-line store, car sales, etc. Retail YoY: -16.9 BY -2.6% ↓ tires & wheels,
Slide 45: <Reference> Domestic Automobile Market Predictions
<Reference> Domestic Automobile Market Predictions (million cars) Domestic demand for (million tires) Commercial tires for passenger cars passenger cars 6 60 54.0 -5.3％ 5 4.84 -5.8％ 55 52.1 4.44 4.46 50.1 51.0 4.20 50 4 45 3 40 2 35 1 30 2012 2013 2014 2015 2012 2013 2014 2015 Source: Japan Automobi
Slide 46: Financial Strategies – Shareholder Return Policy
Financial Strategies – Shareholder Return Policy (Billion Yen) Amount of share buyback and dividend 14.0 12.01 12.0 10.22 10.35 10.24 10.54 10.0 Share 8.0 7.20 4.59 buyback 5.46 5.05 5.50 6.0 Dividend 4.0 4.76 4.81 5.76 5.19 5.04 2.0 0.0 FY March 2012 FY March 2013 FY March 2014 FY March 2015 FY Mar
Slide 47: Automobile purchase and sales (No.1)
Automobile purchase and sales (No.1) Commercial flow of car purchase and B2B sales (No. of cars denotes cumulative units for FY ended Mar 31, 2015) FC Headquarters Sales by auction Appraisal and purchase consigned to FC Headquarters Used car dealers 1,425 cars Auto auctions 10,535 cars Customers Inv
Slide 48: Automobile purchase and sales (No.2)
Automobile purchase and sales (No.2) Commercial flow of retail sales (No. of cars denotes cumulative units for FY ended Mar 31, 2015) New car dealers Used car dealers New car dealers Auto auctions Auto auctions Procurement Procurement FC Headquarters Customers Purchase & Inventories Wholesale Invent
Slide 49: Progress of New Store Openings
Progress of New Store Openings Store name Opening date 1 AUTOBACS AISAI Plaza Store 2014/4/24 2 AUTOBACS HITACHIOMIYA Store 2014/6/13 3 AUTOBACS Tire Shop NUMAZU MINATO Store 2014/7/24 4 AUTOBACS CHOSHI NISHI Store 2014/8/8 5 AUTOBACS NUMAZU HARA Store 2014/8/28 6 AUTOBACS TATEYAMA BYPASS Store 2014
Slide 50: Balance Sheet: Assets
Balance Sheet: Assets (Billion Yen) Total Assets 201.4 BY 186.5 BY Major items changed Cash and deposits 45.6 Trade notes Cash and deposits：-2.9 BY and accounts 42.7 receivable 22.4 Lease Trade notes and accounts investment 18.6 receivable ：-3.8 BY 12.0 assets 0.8 Securities 10.9 16.3 Inventories： -
Slide 51: Balance Sheets: Liabilities & Equity
Balance Sheets: Liabilities & Equity (Billion Yen) Total Liabilities & Equity 201.4BY 186.5BY ST borrowings: Major -1.0 BY items changed Accounts payable 17.6 ST borrowings and 4.4 accounts payable-trade: -4.7 BY corporate bond 12.8 21.9 Other ST 2.9 2.3 liabilities 18.7 Short-term borrowings : -1.4
Slide 52: Performance Results of Franchisees
Performance Results of Franchisees Ordinary Income of Franchise Companies (Preliminary) (Billion Yen) 6.0 4.2 4.0 4.5 3.8 2.0 1.8 0.0 Total of profit-making FCs Total of profit-making subsidiaries -2.0 Total of loss-making FCs Total of loss-making subsidiaries -2.7 Orginary income(net) -4.0 FY March
Slide 53: Segment Information (as of April 1, 2015)
Segment Information (as of April1, 2015) End customer in Japan Retail Domestic store Franchisees subsidiaries Other 19 Companies 83 Companies Customers Retail from Wholesale direct operation Others stores Subsidiaries for Subsidiaries for car AUTOBACS SEVEN supporting function goods supply and other
Slide 54: Forward-Looking Statements
Forward-Looking Statements These materials include forecasts regarding the Company’s future plans, strategies, and performance. This information is based on judgments and estimates made in accordance with information currently available. Actual results may differ materially from forecasts due to suc