Workman Co., Ltd. · TSE:7564
Workman — Q3 FY3/2024 Earnings Presentation
26 slides from Workman's earnings presentation, Feb 5, 2024
Slide 1: Materials for Briefing Session on Q3 Financial Results, FY Ending March 2024
（7564） WORKMAN CO., LTD. Materials for Briefing Session on the Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2024 February 5, 2024
Slide 2: Briefing Contents
Briefing Contents ●Financial Results for the Third Quarter of the Fiscal Year 3 Ending March 31, 2024 ●Overview of Financial Results for the Third Quarter of 7 the Fiscal Year Ending March 31, 2024 ●Plans for the Fiscal Year Ending March 31, 2024 17 ©2024 WORKMAN CO., LTD. All Rights Reserved 2
Slide 3: Financial Results for the Third Quarter
Briefing Contents ●Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2024 ©2024 WORKMAN CO., LTD. All Rights Reserved 3
Slide 4: Cumulative income statement
Cumulative income statement （Millions of yen） FY3/23 FY3/24 YoY ➢ Financial Results Highlights Q3 Ｑ3 （％） ●Sales at all chain stores ・Sales of winter products were sluggish due to the warm winter. Sales at all chain stores 137,871 141,368 +2.5 ・High prices have resulted in heightened awareness of the
Slide 5: Cumulative Selling, General and Administrative Expenses (SG&A)
Cumulative Selling, General and Administrative Expenses (SG&A) SG&A SG&A FY 3/23 FY 3/24 (Millions of yen) ratio ratio Change YoY (％) Q3 Q3 （％） （％） ➢ Factors of increase/decrease Sales at all chain stores 137,871 － 141,368 － － +2.5 ●Labor cost Regular salary increase: +5.1％. Average number of employ
Slide 6: Balance Sheet
Balance Sheet FY 3/23 FY 3/24 FY3/23 （Millions of yen) End of Q3 End of Q3 Change Current assets 97,867 101,390 108,144 +6,753 ➢ Factors of increase/decrease Cash and deposits 70,126 62,640 72,582 +9,942 ●Cash and deposits ・Free cash flow: up 10,591 million yen Accounts receivable ・Payments of divid
Slide 7: Overview of Financial Results for the Third Quarter
Briefing Contents ●Overview of Financial Results for the Third Quarter of the Fiscal Year Ending March 31, 2024 ©2024 WORKMAN CO., LTD. All Rights Reserved 7
Slide 8: 1,006 stores at the end of December 2023
Store Openings ●Openings of stores in urban SCs and suburban open malls, which attract many customers, accelerated 1,006 stores at the end of December 2023 (up 33 stores over end-March 2023) Number of New store openings Renovation/conversion※2 Excluding Number of stores at Partial increase/ Closures
Slide 9: Monthly Trends and Factors
Monthly Trends and Factors ● Rise/Fall in Same-Store Sales, Number of Customers and Average Customer Spending （％） Rise/fall in sales Rise/fall in number of customers Average customer spending Q1 overview Q2 overview Q3 overview Demand for fashion rose as a result of Although summer products sold bri
Slide 10: Status of Sales (FY 3/24 Q3)
Status of Sales (FY 3/24 Q3) ● Sales at All Chain Stores 141,368 Million Yen ●Sales at existing stores by prefecture All chain stores Existing stores While sales of summer products remained robust Net sales +2.5％ △2.1％ thanks to the lingering summer heat, the warm winter since September Number of cu
Slide 11: Status of Sales (Results by Product)
Status of Sales (Results by Product) ●Though the warm winter led to slow sales of winter products for the athleisure market, products for the professional market are selling well ●Factors for Increase/Decrease in FY 3/24 Q3 ●FY 3/24 Q3 Sales by Product Sales at All Chain Stores Athleisure Work Commo
Slide 12: Sales by Business Category
Sales by Business Category ● Contribution to sales at all chain stores (Monthly cumulative period) New stores have maintained strong sales. Sales at existing stores that have not undergone renovation are sluggish. （％） 6.1% 1.0% Sales Composition Ratio (based on all chain stores) 51.5% 41.4% YoY (％)
Slide 13: Status of Sales (Sales by Product and Factors)
Status of Sales (Sales by Product and Factors) ●Sales of workwear/outdoor products and work supplies/rainwear, which have a high ratio of thermal winter goods, were down year-on-year. （Millions of yen） FY 3/23 Q3 FY 3/24 Q3 Category Factors（YoY） Sales YoY Sales YoY ・Summer short Socks (+18.1％) Under
Slide 14: Sales of PB Products 95,561 Million Yen
Status of Sales (Sales by Product and Factors) ●Sales of PB Products 95,561 Million Yen (Up 5.1％ YoY) ●Sales results by brand ●Changes in the PB ratio （The ratio to sales at all chain stores) Number of items （Millions of yen） (the previous year) Sales value (YoY) 80.0% 66.0% 67.7% Work & Outdoor 896
Slide 15: Format of Store Operations
Format of Store Operations ●Ratio of Franchise Stores 94.2％ (Down 1.5 points YoY) ●Format of Store Operations for FY 3/24 Q3 ●Number of Stores by Format of Operations SC Training stores End- End- Outsourcing stores (Contract B) Franchise stores (Contract A) Format March Up Down Sep. Number （％） FC ra
Slide 16: Inventories (Logistics Cost)
Inventories (Logistics Cost) ●Warm winter led to a significant increase in inventories of winter products ●Selling price inventories per store ●DC inventories / delivery cost ratio ・Winter inventories will be carried over and continue to be sold next year. ・As winter products have caused an increase
Slide 17: Plans for the Fiscal Year Ending March 2024
Briefing Contents ●Plans for the Fiscal Year Ending March 31, 2024 ©2024 WORKMAN CO., LTD. All Rights Reserved 17
Slide 18: Plans for FY Ending March 31, 2024
Plans for FY Ending March 31, 2024 ●Management policy ●Accelerate the opening of new SC stores that attract many customers, expand Store the network of stores for general customers opening ●Improve convenience by right-sizing S&B stores according to sales capacity Achieve sustainable growth by creat
Slide 19: Status of Existing Stores
Status of Existing Stores ●Changes in the external environment are intertwined with internal factors, maintaining a challenging situation ●Internal Factors ●Changes in the External Environment ①Product supply system/distribution capacity ・Ordering is done early due to off-season production, making i
Slide 20: Store Opening Plans
Store Opening Plans ●Aim to boost customer convenience by expanding the store network for general consumers and pursuing proactive S&B Number of Openings set for FY 3/24 Renovation set for FY 3/24※2 Number of Excluding Medium/ stores at increase/ stores at (Number of stores) S＆B※2 Closures longer-te
Slide 21: Store Opening Strategy
Store Opening Strategy ●Expect to accelerate store openings starting in the second half of the fiscal year ending March 2025, aiming to achieve a 1,500-store network. ●Accelerate opening of # WORKMAN GIRL stores ●Expand areas where stores can be opened at WORKKMAN Plus Ⅱ Store opening target: 30 sto
Slide 22: Product Development
Product Development ●Focus on developing products that combine high performance with low prices, revisit the right balance of mass and niche products, and re-affirm our strengths as a “category killer.” ●Dedicated products for the ●Strengthen workwear ●Develop core products general market ・Develop p
Slide 23: Status of Product Procurement and Future Pricing Policy
Status of Product Procurement and Future Pricing Policy ●Revise the assumed rate in light of the prolonged depreciation of the yen. Despite efforts to improve profitability by reducing costs and product change/elimination, profit margins have worsened compared to assumptions at the start of the year
Slide 24: Presentation of New Spring and Summer Products for 2024
Presentation of New Spring and Summer Products for 2024 ●Theme: “Stylish, Functional, For Everyday” Sunday, February 18, 2024, at the Tokyo International Forum 1 Functional apparel you will want to 3 Workman Kids wear all the time We will exhibit 35 items of functional In addition to functions that
Slide 25: Plans for the Fiscal Year Ending March 2024
Plans for the Fiscal Year Ending March 2024 ●The full-year forecast is being revised downward due to underperformance in sales and the impact of the weak yen. ・Sales at FC stores fell short of the planned figure by about 5,637million yen, resulting in a drop in royalty revenue of △1,254 million yen.
Slide 26: ■We have prepared this document solely for the purpose of facilitating understanding of WORKMAN,
■We have prepared this document solely for the purpose of facilitating understanding of WORKMAN, and not for the purpose of soliciting investment in the Company. As such, investors are advised to make investment decisions at their own discretion. ■ Whereas every effort has been made to ensure the ac