Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — Q1 FY2024 Earnings Presentation
40 slides from Komehyo's earnings presentation, Aug 14, 2023
Slide 1: Earnings Results Briefing for the First Quarter of FY Ending March 31, 2024
Earnings Results Briefing for the First Quarter of the Fiscal Year Ending March 31, 2024 August 14, 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: 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 １．1st Quarter of Fiscal Year ending March 31, 2024 Revised 2nd Quarter and Full-Year Earnings Forecasts and Dividends Forecasts P.6 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2024 P.24 ３. Reference Information P.34 ・Corporate Profile 5
Slide 6: 1st Quarter Results, Revised Forecasts and Dividends
１．1st Quarter of Fiscal Year ending March 31, 2024 Revised 2nd Quarter and Full-Year Earnings Forecasts and Dividends Forecasts P.6 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2024 P.24 ３. Reference Information P.34 ・Corporate Profile 6
Slide 7: FY 2024 1Q Financial Summary
FY 2024 1Q Financial Summary Brand・Fashion busines Tire and Wheel buisiness Net sales Operating income Purchase from individual customers Net sales Operating income 24,075 1,683 13,519 1,009 2 Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen （YoY 135.3％） （YoY 230.5％） （
Slide 8: Earnings forecast revision Main factors
Earnings forecast revision Main factors As prices continue to rise and the yen depreciates, demand for second-hand goods and popular brand items is high, including among foreign visitors to Japan, and sales of high-priced items are strong. Initial Plan 1Q After 2Q ・Strong market prices for each prod
Slide 9: Revision of results forecasts for the first half and the fiscal year
Revision of results forecasts for the first half and the fiscal year ending March 31, 2024 Inventory secured in the first quarter is expected to contribute to net sales and operating income in the second quarter and beyond. Net income Operating Ordinary Basic earnings (Millions of yen) Net sales att
Slide 10: Medium-term management target (Until FY2026)
Medium-term management target(Until FY2026) Plans for fiscal year ending March 31, 2025 onwards will be announced again in May 2024. FY2024 FY2025 FY2026 (millions of yen) first half full year full year full year Net sales 51,000 106,000 120,000 140,000 Operating income 3,200 7,200 7,000 8,100 Opera
Slide 11: 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 12: Changes in average purchaser unit price by product
Changes in average purchaser unit price by product 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 rebounding market prices for watc
Slide 13: FY 2024 1Q Performance
FY 2024 1Q Performance Both net sales and each profit reached record highs Plan progress (Millions of yen) FY2022 1Q FY2023 1Q FY2024 1Q Change YoY rate* Net sales 14,162 18,753 25,096 6,342 133.8% 23.7% Gross profit 3,985 4,717 6,592 1,874 139.7% － Gross profit margin 28.1% 25.2% 26.3% ＋1.1pt － － G
Slide 14: Operating income increase and decrease factor
Operating income increase and decrease factor Net sales increased, reflecting enhanced purchasing of popular products from corporations in addition to strong purchases from individual customers. The retail as a percentage of total net sales has increased, improving gross profit margin. Operating inc
Slide 15: 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. However, SG&A expenses as a percentage of net sales fell thanks to growth in net sales. SG&A expenses to sales ratio(%) 4,86
Slide 16: Non-operating income(loss) / Extraordinary income(loss)
Non-operating income(loss) / Extraordinary income(loss) (Millions of yen) Non-operating expenses16 Interest expenses13 Extraordinary losses8 Rent expenses Impairment losses7 on store2 Other 0 Other1 Non-operating income54 Extraordinary Foreign exchange gain 31 income 0 Dividend income11 Gain on sale
Slide 17: Balance sheet overview
Balance sheet overview (Millions of yen) FY2023 FY2024 1Q Change Current assets 35,322 39,741 4,418 Cash and deposits 10,382 9,380 -1,001 →Emphasis on efficiency of cash on hand Inventories 18,705 22,921 4,216 →Inventories increased due to strong Individual purchases Other current assets 6,234 7,439
Slide 18: 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 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) FY2022 1Q FY2023 1Q FY2024 1Q Change YoY Net salesc 13,277 17,794 24,075 6,281 135.3% Brand Fashion Op
Slide 20: 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 21: Breakdown of domestic duty-free sales
Breakdown of domestic duty-free sales 【 Composition ratio by country/region 】Chinese and Taiwanese customers account for roughly half of sales and make up 75% of sales from the top five countries. 【Percentage of purchasers by age group】They are younger than the domestic customer base, with the volum
Slide 22: Quarterly Trends in Consolidated Net Sales and Gross Profit Margin
Quarterly Trends in Consolidated Net Sales and Gross Profit Margin 【 Net sales 】Both retail and corporate sales increased due to strong individual purchases. 【 Gross Profit Margin 】Due to the percentage of retail increasing, gross profit margin increased by 1.1 percentage points year over year. Gros
Slide 23: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) The number of customers has increased due to the opening of purchasing centers under the KOMEHYO and BRAND OFF (franchise) brands, and the amounts purchased per customer at existing stores has remained strong, resulting in record highs of purchase amo
Slide 24: 2. Initiatives for the First Quarter
１．1st Quarter of Fiscal Year ending March 31, 2024 Revised 2nd Quarter and Full-Year Earnings Forecasts and Dividends Forecasts P.6 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2024 P.24 ３. Reference Information P.34 ・Corporate Profile 24
Slide 25: Stores: Group total 188 stores (As of June 2023)
Stores：Group total 188 stores（As of June 2023） *Figures in parentheses ( ) are change during the first quarters Brand Fashion Tire and Wheel Flagship stores 5 3 1 Sales stores 1 6 3 Stores annexed with sales facilities 18 ( 1 ) 1 2 2 10 2 ( -1 ) Purchasing Center 92 ( 6 ) 6 ( -1 ) Franchised purchas
Slide 26: Efforts of each brand
Efforts of each brand ▶ Continuing to open stores specializing in purchases KOMEHYO SHIBUYA (3rd year of opening 100 stores in 3 years) location： 16-9 Udagawacho, Shibuya-ku, Tokyo In the first quarter, six purchasing centers were opened. Shibuya ZERO GATE 1st-4th floors open：Mid-November 2023 Contr
Slide 27: 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. Trends and plans for indiv
Slide 28: Product distribution
Product distribution Purchasing quality/market/distribution sale YoY YoY ▲8pt ＋2pt Purchase from KOMEHYO individual customers 69％ 40％ Retail Merchandise center Stores/Home delivery Purchasing/Purchasing at events/ Store Purchasing at visited sites WEB（company,Other company,live commerce） Suitable fo
Slide 29: E-commerce-induced sales rate
E-commerce-induced sales rate E-commerce involvement in net sales reached a record high during the fiscal period due to strong performance of websites from other companies (cross-border e-commerce) driven by the weakening yen.Due to an increase in sales from foreigners visiting Japan at retail store
Slide 30: Efforts of each brand
Efforts of each brand ▶Strengthening retail ▶Growth of overseas business The BRAND OFF Ginza main store, which moved in October 2022, is performing well. ・In May 2023, BRAND OFF The One reopened after relocating. Net sales YoY 309% ・In June 2023, BRANDOFF Taichung Kuang San SOGO Store opened. Purcha
Slide 31: Efforts of each brand
Efforts of each brand ▶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 customers・ An attr
Slide 32: 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 16% year on year, hitting a record high. Number of registered menmbers Trade vo
Slide 33: Tire and Wheel
Tire and Wheel Maintained an operating profit thanks to stronger used product sales and strong online sales of summer and winter tires. The number of used goods purchased through ・Numbers of summer tires sold increased 46% year on Strengthened sales to SNS and overseas distributors, and standalone p
Slide 34: 3. Reference Information
１．1st Quarter of Fiscal Year ending March 31, 2024 Revised 2nd Quarter and Full-Year Earnings Forecasts, Revised Dividends ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2024 ３. Reference Information ・Corporate Profile 34
Slide 35: 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 employees Consolidated: 1,
Slide 36: Corporate History
Corporate History @ Opened KOMEHYO Shoten, a 5-tsubo used clothing store, in Osu, Nagoya 1979 1987 1996 2000 2003 2004 @ Acquired CRAFT Co., Ltd. @£Established KOMEHYO Auction @Acquired Eve Corporation Co.,Ltd. @E£stablished KOMEHYO SHANGHANI LIMITED @Established Auto Parts KOMEHYO (currently AUTO P
Slide 37: Sales shares by segment and by sales channel (FY2023)
Sales shares by segment and by sales channel (FY2023) By segment Brand/fashion business By sales channel Tire and Wheel Real estate leasing Others 5.6% 0.3% 11.4% Retail FY2023 40.9% FY2023 15.9% FY2023 KOMEHYO Brand and fashion business Net sales Consolidated sales amount of sales 86,133 59,021 81,
Slide 38: Overseas expansion
Overseas expansion Opened stores in 4 overseas bases. We purchase and sell locally, and expand the scale while establishing a culture of reuse. We will continue to actively invest in anticipation of market expansion. Shanghai Hong Kong Thailand Taiwan Singapore Brand Purchase(toC) Services to Purcha
Slide 39: Capital allocation policy
Capital allocation policy Growth phase in which securing market share is a priority as the reuse market expands. Generated profits will be used for growth investments (stock inventory, store openings, overseas expansion, etc.) ・Investment in inventory essential for securing sales ・Investment in huma
Slide 40: 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