Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — Q3 FY2023 Earnings Presentation
57 slides from Komehyo's earnings presentation, Feb 13, 2023
Slide 1: Earnings Results Briefing for the Third Quarter of FY Ending March 31, 2023
Earnings Results Briefing for the Third Quarter of the Fiscal Year Ending March 31, 2023 February 13, 2023 Komehyo Holdings Co., Ltd. Securities code: 2780 (Tokyo and Nagoya Stock Exchanges) IR・PR Department TEL +81-52-249-5366 Email ir@komehyo.co.jp
Slide 2: Contents
Contents １．Overview of Financial Results for the Third Quarter P. 2 of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the Third Quarter of the Fiscal Year P. 19 Ending March 31, 2023 ３．Reference Information (Company Profile, etc.) P．32 1
Slide 3: Overview of Financial Results for the Third Quarter
１．Overview of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the Third Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information (Company Profile, etc.) 2
Slide 4: FY 2023 3Q Financial Summary
FY 2023 3Q Financial Summary Brand Fashion Tire and Wheel Net sales Operating income Purchase from individual customers Net sales Operating income 58,853 3,371 33,344 3,807 296 Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen （YoY 126.9％） （YoY 155.3％） （YoY 137.3％） （YoY
Slide 5: Revisions to full-year performance plan for the fiscal year ending March 31, 2023
Revisions to full-year performance plan for the fiscal year ending March 31, 2023 Net income Basic earnings (Millions of yen) Net sales Operating income Ordinary income attributable per share to owners of parent Forecasts released previously 82,500 4,350 4,350 2,830 258.30 Revised forecasts announce
Slide 6: Shareholder return
Shareholder return The annual dividend forecast has been revised upwards from 50 yen to 60 yen per share, in consideration of the projected income level and other factors for the fiscal year ending March 31, 2023. Aiming to increase dividends consistently in line with the status of profit and cash f
Slide 7: Economic Trend
Economic Trend Demand for high-priced items remained strong, as at department stores. The percentage of KOMEHYO's net sales that are tax-free sales started to rise in October and rose month by month (reaching 9.5% in December 2022). 30,000 Nikkei Stock Average(monthly closing price) 20,000 Departmen
Slide 8: Changes in average purchaser unit price by product (KOMEHYO)
Changes in average purchaser unit price by product （KOMEHYO） Due to purchase price control in line with market fluctuations, the year-on-year average sales price of watches remained low. Jewelry and precious metals performed well in 1Q, bags and clothing in 2Q, and clothing in 3Q. The unit purchase
Slide 9: Overview of income statement
Overview of income statement Record-high sales and profits (Millions of yen) FY2023 YoY FY2023 YoY FY2023 YoY FY2023 YoY vs full year 1Q 2Q 3Q 9months plan* Net sales 18,753 132.4% 20,466 124.2% 23,475 122.0％ 62,696 125.7％ 73.8％ Gross profit 4,717 118.4% 5,092 120.8% 6,476 127.8％ 16,287 122.8％ － Gro
Slide 10: Operating income increase and decrease factor
Operating income increase and decrease factor Purchases from individuals remained strong as in the first half and net sales increased. Operating income grew thanks to efforts to control expenses and other efforts. 3,331 △ 312 3,710 △ 1,963 2,654 Increase in personnel expenses such as salaries and al
Slide 11: Changes in selling, general and administrative expenses
Changes in selling, general and administrative expenses Upfront investment for the opening of KOMEHYO GINZA and increased hiring due to store expansion, year-on-year increase over the last three years. The SG&A ratio has decreased compared to the cumulative 3Q of the last 3 years due to advertising
Slide 12: Non-operating income(loss) / Extraordinary income(loss)
Non-operating income(loss) / Extraordinary income(loss) Rent expenses on store 300 Impairment losses 53 （construct in progress） Loss on retirement of fixed assets 10 Interest expenses 43 Loss due to temporary closure 4 Other 10 Non-operating Extraordinary losses 355 losses 69 (Millions of yen) Non-o
Slide 13: Balance sheet overview
Balance sheet overview (Millions of yen) FY2022 FY2023 3Q Change Current assets 29,453 37,443 ＋7,989 Cash and deposits 9,080 10,372 ＋1,292 →Increase cash on hand in preparation for personal purchases Inventories 15,308 20,557 ＋5,248 →Individual purchases are brisk, SELBY Co., Ltd. Inventory increase
Slide 14: Overview by segment
Overview by segment In the Brand Fashion business, both sales and profit increased thanks to strong purchases from individuals and the In the tire and wheel business, second-hand sales remained strong FY2023 FY2023 FY2023 FY2023 (Millions of yen) YoY YoY YoY YoY 1Q 2Q 3Q 9months Net sales 17,794 134
Slide 15: Breakdown of consolidated Net sales (Retail / Overseas)
Breakdown of consolidated Net sales (Retail / Overseas) Corporate sales had a higher percentage due to strong purchases and for keeping stock new and fresh, whereas retail was also bullish, keeping its share at slightly below 50%. The overseas sales ratio dropped mainly due to buoyant domestic sales
Slide 16: Trends in Net sales and Gross Profit Margin
Trends in Net sales and Gross Profit Margin Both retail and corporate sales increased due to strong individual purchases.In addition to improving the purchase ratio of purchases, the sales composition ratio of watches, which have a low gross profit margin, declined. Gross profit margin increased by
Slide 17: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) Due to the steady growth in the amount of purchases per customer, personal purchases were strong at 130.7% year-on-year in 3Q. The highest purchase amount in the accounting period. Number of stores 170 162 170 137 148 126 126 96 Purchase from individu
Slide 18: Changes in corporate auction trade volume
Changes in corporate auction trade 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 20% year on year, hitting a record high. Number of registered
Slide 19: E-commerce-induced sales rate (KOMEHYO)
E-commerce-induced sales rate (KOMEHYO) Our own e-commerce site performed well, up 11.3% year-on-year. Due to the impact of the watch market, the composition ratio of watches in EC-related sales decreased by 10.8 points compared to the same period last year. Sales related to EC also decreased due to
Slide 20: Initiatives for the Third Quarter of the Fiscal Year
１．Overview of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the Third Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information (Company Profile, etc.) 19
Slide 21: Stores: Group total 170 stores (As of December 2022)
Stores：Group total 170 stores（As of December 2022 ) *Figures in parentheses ( ) are change during the three quarters. Brand Fashion Tire and Wheel Flagship stores 5 3 1 Sales Stores 2 6 3(1) Stores annexed with sales facilities 12 6 2 2（ 2 ） 10 3 Purchasing Center 76 ( 19 ) 7（-1） Franchised purchasi
Slide 22: Effect of opening the purchase center (KOMEHYO)
Effect of opening the purchase center (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 customers by
Slide 23: Efforts to strengthen purchasing (FY2023 9months)
Efforts to strengthen purchasing （FY2023 9months) 19 purchasing centers launched 116 purchase events held 3Q launched • At commercial facilities and department stores considered to be reassuring, familiar and close to consumers since they are found in ASPIA AKASHI / PLARE MATSUDO/ Shin-Shizuoka ceno
Slide 24: Efforts to strengthen purchasing (FY2023 9months)
Efforts to strengthen purchasing （FY2023 9months) A hundred franchised purchase centers will be set up in the three-year period starting in the previous fiscal year. We are aiming to introduce at least 20 new stores by the end of the current fiscal year. Items purchased at franchise purchase centers
Slide 25: Product distribution (FY2023 9months)
Product distribution （FY2023 9months) Purchasing quality/market/distribution Sale KOMEHYO Merchandise center Purchase from individual customers 77％ 40％ Retail Stores/Home delivery Purchasing/Purchasing at Store events/Purchasing at visited sites Suitable for retail WEB（company,Other company,live com
Slide 26: 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. KOMEHYO GINZA February 15, 2022 KOMEHYO GINZA CLOSED ● ●Tiffany 東急プラザ銀座 ● Feb 18-Aug 28 KOMEHYO GINZA LIMITED CLOSED ●LOUIS VUITTON KOMEHY
Slide 27: Renovation of the flagship BRAND OFF Ginza Main Store
Renovation of the flagship BRAND OFF Ginza Main Store It opened on October 8, 2022. Its sales in October jumped 522% from the sales of the previous Ginza main store in the same month of the previous year. It achieved bullish sales mainly due to inbound tourists. In December, monthly purchases hit a
Slide 28: Continue strengthening OMO (FY2023 9months)
Continue strengthening OMO （FY2023 9months) Customer services on smartphones Live Commerce Contact center A total of 307 staff members across the country holds In August 2020, a contact center was established with the Apart from the stores, we have launched dedicated smartphones exclusively for cust
Slide 29: Technology indispensable to store operation: AI
Technology indispensable to store operation：AI The system has been introduced to all the KOMEHYO purchase centers, all of K-Brand Off's franchised purchase centers and some of the LINK SMILE and USED MARKET shops. It will be introduced to purchase events and to the global business. It is a technolog
Slide 30: Overseas expansion
Overseas expansion Overall operations of overseas stores in four locations, Thailand, Taiwan, Shanghai and Hong Kong, have shifted from an investment phase to a phase of generating income for the Group. A purchase center is set to be launched in central Singapore in April 2023 or later. Thailand SHA
Slide 31: Tire and Wheel
Tire and Wheel Sales of used tires and wheels increased from a year ago due to strong online sales. Net sales and operating income surged. Craft Auto Parts Japan 4×4 engineering service ・The 50th anniversary renewal event was held to • An automatic washing machine was introduced increase wheels and
Slide 32: 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 33: Reference Information (Company Profile, etc.)
１．Overview of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the Third Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information (Company Profile, etc.) 32
Slide 34: 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: 1,105 Non-co
Slide 35: Corporate History
Corporate History ●Acquired Eve Corporation Co.,Ltd. ●Established KOMEHYO SHANGHANI LIMITED ●Established Auto Parts KOMEHYO (currently AUTO PARTS JAPAN) ●Established KOMEHYO HONG KONG LIMITED ●Transition to a holding company structure ● Acquired CRAFT Co., Ltd. ●Opened the second ●Established KOMEHY
Slide 36: 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 37: 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 38: 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 39: 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 40: Corporate governance system
Corporate governance system The Group's management efficiency and business performance are aimed 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 interests. We are work
Slide 41: Officer system / Skills matrix
Officer system Name Takuji Ishihara Toshio Sawada Yuya Yamauchi Masaru Hirauchi Yoshiko Nakahara Kazutoshi Torita Momoko Murase Miyuki Minamiru Director Outside Director Outside Director President and Title Managing Director Director Outside Director Outside Director (Audit and Supervisory (Audit an
Slide 42: 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 41
Slide 43: Medium-term management target (until FY2025)
Medium-term management target (until FY2025) FY2023 *1 FY2024 *2 FY2025*3 (Millions of yen) Full year Full year Full year Net sales 85,000 85,000 100,000 Operating income 4,780 4,400 5,500 Operating profit margin 5.6% 5.2% 5.5% Ordinary income 5,040 4,400 5,500 Net income attributable to owners of p
Slide 44: Sales plan
Sales plan Will revise forecasts in May 2023. (Millions of yen) 100,000 85,000 85,000 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 Revised results forecasts in February 2023. 43
Slide 45: Operating Profit Plan
Operating Profit Plan 7.5 7.2 Operating Income 6.1 Margin (%) 5.2 5.6 5.2 5.5 3.6 3.7 2.1 Will revise forecasts in May 2023. 1.2 0.5 5,500 Operating Income 4,780 (Millions of yen) 4,400 3,714 2,999 3,129 2,789 1,860 1,625 590 297 832 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2
Slide 46: Ordinary income/Net income Plan
Ordinary income/Net income Plan Will revise forecasts in May 2023. Ordinary income 5,500 Net income 5,040 (Millions of yen) attributable to owners of 4,400 parent 3,772 3,450 3,162 3,280 2,988 2,742 2,850 2,259 2,040 1,834 1,826 1,696 1,610 1,073 1,009 815 355 431 9 △ 234 △ 595 FY2014 FY2015 FY2016
Slide 47: Medium-term management plan: Brand Fashion and Tire/Wheel
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 48: 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 49: 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 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 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 51: 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 52: 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. February 15, 2022 KOMEHYO GINZA CLOSED KOMEHYO GINZA ● Feb 18-Aug 28 KOMEHYO GINZA LIMITED CLOSED ●Tiffany KOMEHYO GINZA PLUS ●LOUIS VUITT
Slide 53: 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. Sale
Slide 54: Human capital management (KOMEHYO)
Human capital management（KOMEHYO） Groupwide training of personnel for the next generation Education of assessors by a team dedicated to education KOMEHYO provide opportunities for groupwide training aimed at developing management personnel and executives for the next generation. KOMEHYO focuses its
Slide 55: 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 56: Sales shares by segment and by sales channel (FY2022)
Sales shares by segment and by sales channel (FY2022) By segment Brand/fashion business By sales channel by operating company Tire and Wheel Real estate leasing Other 6.1% 0.5% 10.1% K-BRAND OFF Retail 43.3% 14.8% Brand and fashion business Corporate Consolidated sales amount of sales Komehyo Sales
Slide 57: 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