Matsukiyococokara & Co. · TSE:3088

Matsukiyococokara & — H1 FY2024 Earnings Presentation

50 slides from Matsukiyococokara &'s earnings presentation, Nov 22, 2024

Slide 1: Financial Results for the Six Months Ended September 30, 2024
Financial Results for the Six Months Ended September 30, 2024 Copyright 2024 November 22, 2024 MatsukiyoCocokara & Co. All rights Reserved. MatsukiyoCocokara & Co.
Slide 2: Table of Contents
Table of Contents Management summery for First Half P.3 ～ P.6 Management policies for Second Half Financial Results and Financial Forecasts P.7 ～ P.16 Financial Results for 1H FY2024 ・Financial Summary (YoY) ・Segment Results (YoY, profit margin trends) ・Net Sales by Product ・Balance Sheet ・Statement
Slide 3: Management Summary for First Half, Management Policies for Second Half
Management Summary for First Half Management Policies for Second Half Copyright 2024 MatsukiyoCocokara & Co. All rights Reserved. 3
Slide 4: Management Summary for the First Half of FY2024
Management Summery for the First Half of FY2024 Results Net sales 103.5％ YoY, Operating profit 100.3％, Operating profit margin7.2％（+0.2pt YoY） Increase Despite the impact of increased demand for COVID-19-related products in the previous year, continued recovery in foot traffic and duty-free sales le
Slide 5: Management Policies for the Second Half of FY2024
Management Policies for the Second Half of FY2024 Positioning for FY2024 Key Strategies （FY2024) ❚Further integration and Japan Strategies Provision of values that correspond to the life accelerating strategy stages of customers Further integrate the membership base, Pursuit of convenience e-commerc
Slide 6: Realizing the Group Philosophy
Realizing the Group Philosophy We aim to enhance corporate value and realize the Group's philosophy by linking and promoting initiatives for sustainable management with our key strategies. Management Philosophy Creating the future “Normal” and innovating lifestyles Group Management Targets for the F
Slide 8: Financial Summary (YoY)
Financial Results for 1H FY2024 Financial Summary (YoY)  Sales increased due to the optimal functioning of key strategies, despite a reactionary decline in COVID-19 related products  Operating profit rose due to control of SG&A expenses, which had increased as a result of investment in human capit
Slide 9: Segment Results (YoY)
Financial Results for 1H FY2024 Segment Results (YoY)  Matsumotokiyoshi Group recorded an increase in sales and profit against the backdrop of increased flow of people in urban areas and downtown and an increase in overseas tourists visiting Japan.  Cocokarafine Group secured an increase in sales
Slide 10: Segment Results (YoY) Reference
Financial Results for 1H FY2024 Segment Results (YoY) Excluding amortization of goodwill and trademark rights totaling 1,809 million yen Reference associated with the management integration with cocokarafine Inc. ((Millions of yen) Six Months Ended Six Months Ended September 30, 2022 September 30, 2
Slide 11: Net Sales by Product
Financial Results for 1H FY2024 Net Sales by Product  Increase in our focused health and beauty categories  Steady implementation of key strategies led to an improvement in gross profit margin, despite a reactionary decline in COVID-19 related products ((Millions of yen) Net sales Gross profit mar
Slide 12: Balance Sheet
Financial Results for 1H FY2024 Balance Sheet  As part of its flexible capital policy, the Group executed a share buyback worth 30.9 billion yen during the six months ended September 30, 2024.  Under net assets, capital surplus decreased by 27.2 billion yen due to the cancellation of treasury shar
Slide 13: Statement of Cash Flows
Financial Results for 1H FY2024 Statement of Cash Flows  Net cash provided by operating activities was approximately 45.1 billion yen mainly due to the recognition of profit before income taxes.  Free cash flow generated during the period totaled 35.4 billion yen, a year-on-year increase of approx
Slide 14: Store Openings, Closings, and Renovations in Japan
Financial Results for 1H FY2024 Store Openings, Closings, and Renovations in Japan  Actual results for the first half of FY2024 (Unit: No. of stores) Number of stores Openings Closings Renovations Number of stores as of March 31, 2024 in 1H in 1H in 1H as of Sep 30, 2024 Matsumotokiyoshi Group 1,90
Slide 15: FY2024 Financial Forecasts
Financial Forecasts for FY2024 FY2024 Financial Forecasts  There are no revisions to the consolidated earnings forecast announced on May 10, 2024 (Millions of yen) Full Year FY2023 FY2024 Change Change % to net sales % to net sales (amount) (%) Net sales 1,022,531 1,050,000 27,468 2.7 Gross profit
Slide 16: Shareholder Return
Financial Forecasts for FY2024 Shareholder Return  Targets set for DOE (dividend on equity) of at least 3% and dividend payout ratio of at least 30%.  We have introduced a progressive dividend policy, whereby dividends are maintained or increased. 35  We will flexibly implement share円buyback, tak
Slide 18: Basic Policy for Financial Capital Strategy to Enhance Corporate Value
Basic Policy for Financial Capital Strategy to Enhance Corporate Value The basic policy for financial capital strategy aims to balance (1) improving capital efficiency, (2) enhancing our financial base, and (3) fleshing out shareholder returns. Based on this policy, we will promote initiatives to en
Slide 19: Initiatives to Achieve Management Plan: Improve ROE
Initiatives to Achieve Management Plan: Improve ROE While pursuing continued profitability and efficiency, EPS has grown steadily compared to the first half-year results after integration. The optimal capital structure remained in the 70% range, though it recently decreased by 0.1 pt due to the canc
Slide 20: Initiatives to Achieve Management Plan: Reduce Cost of Capital
Initiatives to Achieve Management Plan: Reduce Cost of Capital Fleshed out shareholder returns in light of stock price trending below theoretical value after the FY2023 performance announcement Intensifying various initiatives for climate change response, aiming for total volume targets (Scopes 1 &
Slide 21: Initiatives to Achieve Management Plan: Improve Growth Rate
Initiatives to Achieve Management Plan: Improve Growth Rate Analyzed the correlation between non-financial KPIs’ financial impact and ROIC Implementing employee engagement improvement measures based on a strong correlation between human capital strategy and financial KPIs Enhancing investment appeal
Slide 23: Operating profit margin for FY2024
Operating profit margin for FY2024 Matsumotokiyoshi Group’s operating profit margin improved. Cocokarafine Group has maintained the improved operating profit margin achieved up to the previous fiscal year. Matsumotokiyoshi Group Cocokara fine Group Retail business Retail business Operating profit ma
Slide 24: Past and Future Initiatives
Past and Future Initiatives Until now, we have continued to improve performance through management integration synergies. From now on, we aim to improve our performance further by evolving in the areas where we want to win. Until now From now Enhance Enhance Evolve in areas where basics value we wan
Slide 25: Areas Where We Want to Win
Areas Where We Want to Win From now on, MatsukiyoCocokara & Co. will focus on establishing areas where we want to win in stores, customers, and products. Our areas where we want to win Urban areas where trends originate and continue to be disseminated Stores People with high information sensitivity
Slide 26: Increasing Profits Through Sales
Increasing Profits Through Sales We will further increase operating profit relative to sales by concentrating resources on areas where we want to win and DX-driven platforms. Operating profit Sales DX Marketing Copyright 2024 MatsukiyoCocokara & Co. All rights Reserved. 26
Slide 27: Evolution We Aim For
Evolution We Aim For For stores: Evolution beyond just retail to become information dissemination hubs For customers: Providing more flexible shopping experiences through services For products: Offering higher quality products through co-creation with manufacturers Our Targeted Evolution Customers S
Slide 28: Marketing Platform
Marketing Platform We have built a platform that provides comprehensive insight into all purchasing behavior. Collaboration with LIPS app has initiated customer attraction from external sites, further enhancing value. Marketing Platform Stores Influencers Live streaming App Content New brands enhanc
Slide 29: Increasing Profits Through Sales
Increasing Profits Through Sales We will further increase operating profit relative to sales by concentrating resources on areas where we want to win and DX-driven platforms. Operating profit Sales DX Marketing Copyright 2024 MatsukiyoCocokara & Co. All rights Reserved. 29
Slide 30: Enhancing Customer Experience
Enhancing Customer Experience Using services, we will increase customer LTV through cross-utilization of drug stores, e-commerce, and dispensing pharmacies. Improving Customer Experience to Increase LTV Free and seamless use of e-commerce, drug stores and dispensing pharmacies Drug Dispensing Use Qu
Slide 31: Increasing Profits Through Sales
Increasing Profits Through Sales We will further increase operating profit relative to sales by concentrating resources on areas where we want to win and DX-driven platforms. Operating profit Sales DX Marketing Copyright 2024 MatsukiyoCocokara & Co. All rights Reserved. 31
Slide 32: Store Strategy
Store Strategy Concentrating resources in target areas with current and future profit potential, we will increase market share through active store openings and service expansion. Opening Stores in Target Areas We will focus internal resources on store expansion in areas Store strategy with a curren
Slide 33: Store Rebranding
Store Rebranding We will rebrand our main cosmetics stores as beauty flagship stores. We will provide these as information hubs for brands and customers. Enhancing Store Value Flagship 150 stores account for 25% of cosmetics sales Beauty Flagship matsukiyo LAB Regular stores Copyright 2024 Matsukiyo
Slide 34: Increasing Profits Through Sales
Increasing Profits Through Sales We will further increase operating profit relative to sales by concentrating resources on areas where we want to win and DX-driven platforms. Operating profit Sales DX Marketing Copyright 2024 MatsukiyoCocokara & Co. All rights Reserved. 34
Slide 35: Private Brands
Private Brands The composition of sales of private brands integrated into “matsukiyo” has been increasing. We will continue to develop PB products that “create the common sense of the future and change people's lives. Private brand performance for first half of FY2024 PB product sales 105.5 % YoY PB
Slide 36: Strengthening Co-created Products
Strengthening Co-created Products To revitalize private brands, we will strengthen co-created products utilizing our data and manufacturers’ technology. Shifting from manufacturer-led products to co-created products - Manufacturer-led products - - Co-created products - Manufacturer < Manufacturer &
Slide 38: Corporate profile
Corporate profile Trade name MatsukiyoCocokara ＆ Co． Address 1-8-2 Yushima, Bunkyo-ku, Tokyo Group-wide strategy formulation, strategy implementation support Main business and management and administration President, Representative Director Kiyoo Matsumoto Vice President, Representative Director Ats
Slide 39: History of the Management Integration
History of the Management Integration Oct. 1, 2021 1932 1954 MatsukiyoCocokara ＆ Co． Founded Matsumoto Pharmacy From private enterprise to as a privately-run enterprise incorporated body 2007 Established Matsumotokiyoshi Holdings 1937 Co., Ltd. Established Segami Pharmacy 2008 Established Cocokara f
Slide 40: Philosophy, Vision, and Management Targets
Philosophy, Vision, and Management Targets Group Management Targets for the Fiscal Year Ending March 31, 2026 The Group aims to achieve the following sales and profits in order to become Asia's No.1 drugstore and establish a leading position in the health and beauty fields. Group net sales 1.5 trill
Slide 41: Organizational Structure of the Group
Organizational Structure of the Group Organizational structure of the group Main business activities of MatsukiyoCocokara & Co.  Holding company  Group-wide strategy formulation, strategy implementation support and management and MatsukiyoCocokara & Co. administration Main business activities of M
Slide 42: Net Sales by Product
Net Sales by Product Medical and pharmaceutical products Cosmetics (Billions of yen) (Billions of yen) Matsumotokiyoshi Group Matsumotokiyoshi Group Cocokara fine Group Cocokara fine Group 179 177 200 176 200 165 180 149 159 180 146 160 135 160 138 137 140 80 80 140 57 59 120 67 76 120 45 45 54 100
Slide 43: Dispensing
Dispensing Dispensing sales Dispensing pharmacy stores Matsumotokiyoshi Group (Billions of yen) Matsumotokiyoshi Group (stores) Cocokara fine Group Cocokara fine Group 79 1,000 78 951 74 827 899 67 56 654 544 49 507 524 47 49 469 41 32 327 24 26 27 28 29 327 358 392 427 456 1H FY2020 1H FY2021 1H FY
Slide 44: Stores by Area in Japan
Stores by Area in Japan MatsukiyoCocokara & Co. Group total 3,488 Stores in Japan (As of Sep. 30, 2024) Hokkaido Tohoku 130 ❚ Matsumotokiyoshi Group ：1,925 MKG 93 CFG 37 ❚ Cocokara fine Group ：1,563 Koshinetsu Hokuriku 245 Chugoku MKG 181 Shikoku 221 CFG 64 MKG 75 CFG 146 Kyushu Kanto 1,516 Okinawa
Slide 45: Customer Contact Points, and PB Product Sales
Customer Contact Points, and PB Product Sales PB product sales Customer contact points Sales composition ratio of PB products 12.8 ％ 2,146 SKU Total 152 millon （As of Sep. 30, 2024）（As of Sep. 30, 2024） KNOWLEDGE – Men’s skincare and hair care brand Advanced skincare designed specifically for men’s
Slide 46: Five years full-years results
Five years full-years results Operating profit and Net sales and No. of stores Gross profit and gross profit margin (%) operating profit margin (%) 3,464 7.4％ (Billions of yen) 3325 3409 34.6 34.6％ 6.4 6.5 32.07 32.69 32.9 5.7 5.6 1,022 354 951 329 75 (Billions of yen) 62 1717 1764 (Billions of yen)
Slide 47: Quarterly Consolidated Financial Results
【Appendix】 Quarterly Consolidated Financial Results FY2023 FY2024 （Millions of yen/%） 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year Net sales 248,222 259,544 262,566 252,197 1,022,531 259,749 265,979 Gross profit 84,199 89,627 91,074 89,197 354,097 89,241 93,115 Gross profit margin 33.9 34.5 34.7 35.4
Slide 48: Quarterly Segment Results
【Appendix】 Quarterly Segment Results FY2023 FY2024 （Millions of yen/％） 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year Sales 152,810 159,867 162,999 157,439 633,117 162,010 166,075 Matsumoto- kiyoshi Segment profit 11,783 12,937 14,267 12,753 51,741 12,560 13,647 Group Business Segment profit margin 7.7
Slide 49: Quarterly Net Sales and Gross Profit by Product
【Appendix】 Quarterly Net Sales and Gross Profit by Product FY2023 FY2024 (Millions of yen/％) 1Q 2Q 3Q 4Q Full Year 1Q 2Q 3Q 4Q Full Year Medical and Sales 85,192 91,340 93,264 92,095 361,892 88,378 90,809 pharmaceuti Segment profit 35,218 40,039 40,416 40,961 156,636 37,069 40,665 cal products Segme
Slide 50: Cautionary Statement
Cautionary Statement This document contains future outlooks such as plans, forecasts, strategies, and others which are not historical fact and these are made by the management’s judgement based on the obtainable information at the time of the disclosure. Actual results may significantly differ from

MatsukiyoCocokara & — H1 FY2024 Earnings Presentation on 6ix

Matsukiyococokara & — H1 FY2024 Earnings Presentation

Slide 1: Financial Results for the Six Months Ended September 30, 2024

Slide 2: Table of Contents

Slide 3: Management Summary for First Half, Management Policies for Second Half

Slide 4: Management Summary for the First Half of FY2024

Slide 5: Management Policies for the Second Half of FY2024

Slide 6: Realizing the Group Philosophy

Slide 7: Financial Results and Financial Forecasts

Slide 8: Financial Summary (YoY)

Slide 9: Segment Results (YoY)

Slide 10: Segment Results (YoY) Reference

Slide 11: Net Sales by Product

Slide 12: Balance Sheet

Slide 13: Statement of Cash Flows

Slide 14: Store Openings, Closings, and Renovations in Japan

Slide 15: FY2024 Financial Forecasts

Slide 16: Shareholder Return

Slide 17: Initiatives to Enhance Corporate Value

Slide 18: Basic Policy for Financial Capital Strategy to Enhance Corporate Value

Slide 19: Initiatives to Achieve Management Plan: Improve ROE

Slide 20: Initiatives to Achieve Management Plan: Reduce Cost of Capital

Slide 21: Initiatives to Achieve Management Plan: Improve Growth Rate

Slide 22: MatsukiyoCocokara's Key Strategic Themes

Slide 23: Operating profit margin for FY2024

Slide 24: Past and Future Initiatives

Slide 25: Areas Where We Want to Win

Slide 26: Increasing Profits Through Sales

Slide 27: Evolution We Aim For

Slide 28: Marketing Platform

Slide 29: Increasing Profits Through Sales

Slide 30: Enhancing Customer Experience

Slide 31: Increasing Profits Through Sales

Slide 32: Store Strategy

Slide 33: Store Rebranding

Slide 34: Increasing Profits Through Sales

Slide 35: Private Brands

Slide 36: Strengthening Co-created Products

Slide 37: Appendix

Slide 38: Corporate profile

Slide 39: History of the Management Integration

Slide 40: Philosophy, Vision, and Management Targets

Slide 41: Organizational Structure of the Group

Slide 42: Net Sales by Product

Slide 43: Dispensing

Slide 44: Stores by Area in Japan

Slide 45: Customer Contact Points, and PB Product Sales

Slide 46: Five years full-years results

Slide 47: Quarterly Consolidated Financial Results

Slide 48: Quarterly Segment Results

Slide 49: Quarterly Net Sales and Gross Profit by Product

Slide 50: Cautionary Statement