Vega Corporation Co., Ltd. · TSE:3542
Vega — Q3 FY2024 Earnings Presentation
31 slides from Vega's earnings presentation, February 2024
Slide 1: Quarterly Financial Results
For the Nine Months Ended December 31, 2023 Quarterly Financial Results Vega corporation Co., Ltd. Securities code: 3542
Slide 2: INDEX
1 Overview of Quarterly Financial Results for the Nine Months Ended December 31, 2023 INDEX 2 Report on LOWYA business 3 Report on DOKODEMO business Financial results briefing materials 2
Slide 3: Overview of Quarterly Financial Results
Overview of Quarterly Financial Results 1 for the Nine Months Ended December 31, 2023 Financial results briefing materials
Slide 4: Financial Highlights (3Q Cumulative)
Financial Highlights (3Q Cumulative) As a result of the shift to a profit-oriented management policy and the efforts made in each business operation, company-wide net sales were 11,812 million yen (94.7% YoY), while operating profit significantly improved to 302 million yen (140.6% YoY). Company-wid
Slide 5: Quarterly Net Sales and Operating Profit
Quarterly Net Sales and Operating Profit Following on from 2Q, as each business continued to implement profit-oriented measures, net sales decreased to 3,906 million yen (93.4% YoY) in 3Q, but operating profit reached a record high for 3Q of 274 million yen (275.5% YoY). (Million yen) Net sales (lef
Slide 6: Causes of Increase/Decrease in Quarterly Operating Profit
Causes of Increase/Decrease in Quarterly Operating Profit (3Q Cumulative) In the LOWYA business, in an effort to improve profitability, the Company also worked to reduce personnel expenses and fixed costs, focusing on reducing advertising expenses. As a result, the Company significantly reduced sell
Slide 7: Balance Sheet
Balance Sheet The Company continued to be debt free and maintained a high equity ratio of 78.9%. (Million yen) Current fiscal year Current fiscal year Previous fiscal year Previous fiscal year (as of March 31, 2023) 3Q (as of March 31, 2023) 3Q (as of December 31, 2023) (as of December 31, 2023) Cur
Slide 8: Report on LOWYA business
Financial results briefing materials 2 Report on LOWYA business
Slide 9: Major Indicators (3Q Cumulative)
Major Indicators (3Q Cumulative) The Company changed its policy to focus on profit, reduced sales promotion expenses and advertising expenses from 2Q, and implemented price pass-through from 3Q. As a result, GMV was 11,867 million yen (93.6% YoY), and net sales were 11,495 million yen (96.3% YoY) fo
Slide 10: Quarterly Net Sales and Operating Profit
Quarterly Net Sales and Operating Profit Following on from 2Q, the Company reduced promotion expenses and advertising expenses in an effort to improve profitability. As a result, net sales were 3,799 million yen (94.6% YoY), and operating profit was 266 million yen (253.7% YoY). (Million yen) Net sa
Slide 11: Business Total Monthly Net Sales
Business Total Monthly Net Sales Following on from 2Q, the Company reduced promotion expenses and advertising expenses in an effort to improve profitability. As a result, net sales remained 90% to 100% YoY. (Million yen) FY2023 FY2024 YoY 2,000 105.9% 99.5% 98.4% 100.4% 1,818 95.6% 93.6% 93.3% 90.5%
Slide 12: Number of Customers/Average Basket Value
Number of Customers/Average Basket Value The Company reduced promotion expenses and advertising expenses in an effort to improve profitability. As a result, the number of customers decreased compared with 3Q in the previous year. Average basket value remained stable. (People) Number of customers Avg
Slide 13: Gross Profit Margin (vs. Net Sales)
Gross Profit Margin (vs. Net Sales) Although the yen weakened significantly, gross profit margin reached 48.8% (up 1.6 pt YoY) due to the reduction of promotion expenses and the effect of price pass-through. After 4Q, the Company will continue to work on improving its gross profit margin. (%) Gross
Slide 14: Quarterly SG&A Expenses and SG&A Expense Ratio
Quarterly SG&A Expenses and SG&A Expense Ratio (against Net Sales) In an effort to improve profitability, which started in 2Q, the Company also worked to reduce personnel expenses and fixed costs, focusing on reducing advertising expenses. As a result, selling, general and administrative expense rat
Slide 15: Flagship Store Membership, Age Distribution, Ratio of Male vs. Female
Flagship Store Membership, Age Distribution, Ratio of Male vs. Female Membership of the flagship store is steadily increasing, with strong support from the main target group (people in their 20s and 30s). Trend in membership of flagship store Age distribution (Thousand people) 60 and older 50 to 59
Slide 16: New Products
New Products The Company released products with a focus on private brand products that are design- and trend-conscious, and has strived to set prices that are affordable, taking advantage of its cost competitive edge. Home appliances Furniture & others Clothes dryer Fukari Oshiteru for “Oshikatsu” s
Slide 17: Apps and Social Media
Apps and Social Media The internally developed official app and operation of social media function as the key to attracting customers. The cumulative number of smartphone app DLs exceeded the mark of 1 million in 2Q and is steadily increasing. Sizes of engagement channels that deliver a unique brand
Slide 18: SNS Activity Report
SNS Activity Report On Instagram and TikTok, products, stores, and information useful to customers are distributed from time to time, which greatly contributes to attracting customers to e-commerce and actual stores. The Company plans to continue actively working on this as an engagement measure to
Slide 19: Actual Store: No. 1 Kyudai Ito Store
Actual Store: No. 1 Kyudai Ito Store April 2023 — First actual store opened in “ITO Lab Plus” in Nishi-ku, Fukuoka City. The store held events while replacing products each season. Interior Interior 19
Slide 20: Actual Store: No. 2 NAMBA PARKS Store
Actual Store: No. 2 NAMBA PARKS Store December 2023 — Second actual store opened in “NAMBA PARKS” in Naniwa-ku, Osaka City. Exterior Interior 20
Slide 21: Actual Store: No. 2 NAMBA PARKS Store — Opening Day
Actual Store: No. 2 NAMBA PARKS Store — Opening Day December 2023 — Second actual store opened in “NAMBA PARKS” in Naniwa-ku, Osaka City. Entry was restricted when it opened The store was very busy 21
Slide 22: Amount of Orders Received Around the Store Areas (No. 1 Kyudai Ito Store)
Amount of Orders Received Around the Store Areas (No. 1 Kyudai Ito Store) Since the boom at the opening in April to May, amount of orders received around the store areas has been stable at around 120% YoY. (%) Amount of orders received around the store areas 2022 2023 YoY 141.0% 137.2% 140.0% 123.3%
Slide 23: Amount of Orders Received Around the Store Areas (No. 2 NAMBA PARKS Store)
Amount of Orders Received Around the Store Areas (No. 2 NAMBA PARKS Store) Opened in mid-December, amount of orders received around the store areas rose to 102.6% YoY. After 4Q, the level of the index is expected to rise further as it contributes one month. (%) Amount of orders received around the s
Slide 24: Customer reactions on SNS
Customer reactions on SNS Many comments from customers, such as impressions of the products, requests and reactions of the stores. Many people have been waiting for the opening of new stores. The Company will continue to study the possibility of nationwide expansion. Comments on the products Comment
Slide 25: Actual Store: No. 3 NAGOYA MINATO Store
Actual Store: No. 3 NAGOYA MINATO Store The Company plans to open the third store in Nagoya in February 2024. The Company is also considering opening its fourth and subsequent stores. Nagoya NAMBA PARKS Store Tokyo Kyudai Ito Store Location: Floor 2, NAGOYA MINATO TSUTAYA Fukuoka BOOKS (Minato-ku, N
Slide 26: Sustainability
Sustainability Of ESG, the Company conducted activities related to the environment and society. It will also continue making various studies, including considering measures to strengthen governance. Use recycled materials for product packaging Donation of photographed goods September 2023 November 2
Slide 27: Report on DOKODEMO business
Financial results briefing materials 3 business Report on DOKODEMO
Slide 28: Major Indicators (3Q Cumulative)
Major Indicators (3Q Cumulative) The Company changed its policy to focus on profit and reduced promotion expenses and advertising expenses from 2Q. As a result, GMV was 2,073 million yen (51.6% YoY), and net sales were 316 million yen (59.7% YoY) for the nine months ended December 31, 2023. Membersh
Slide 29: GMV and Net Business Income
GMV and Net Business Income Following on from 2Q, the Company was impacted by shortages of popular pharmaceuticals and reduced promotion expenses and advertising expenses in an effort to improve profitability. As a result, GMV was 645 million yen, but the revenue structure improved and the business
Slide 30: Ratio of GMV by Destination Area
Ratio of GMV by Destination Area Deliveries to Asia, mainly Taiwan, account for more than 90% of GMV. By region By country Middle East 0.6% Oceania 1.1% Europe 1.5% North America South Korea 5.1% US 0.3% Hong Kong 2.9% 4.2 Taiwan 6.8 5 .0% % 84.9 83 .6% Malaysia Asia 0.3% Philippines 0.3% 91.7% Sing
Slide 31: IR Inquiries
Views and forecasts in this document were prepared based on the judgment of the Company at the time of preparation. These statements are based on current expectations, forecasts, and IR Inquiries assumptions that are subject to risks, and contain uncertainties that could cause actual outcomes to dif