Kusuri No Aoki Holdings Co.,ltd. · TSE:3549
Kusuri No Aoki Holdings Co.,ltd — FY2023 Earnings Presentation
40 slides from Kusuri No Aoki Holdings Co.,ltd's earnings presentation, Jul 5, 2023
Slide 1: Financial Results Briefing for the Fiscal Year Ended May 2023
Financial Results Briefing for the Fiscal Year Ended May 2023 KUSURI NO AOKI HOLDINGS CO., LTD. (TSE Prime Section Code 3549) July 5, 2023 Hironori Aoki
Slide 2: Summary of Financial Results and Earnings Forecast; Progress of Third Medium-term Plan
Summary of Financial Results for 1 the Fiscal Year Ended May 2023 and Earnings Forecast for the Fiscal Year Ending May 2024 2 Progress Status of the Third Medium-term Management Plan (for five years) Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Rights Reserved. 2
Slide 3: Summary of Financial Results for FY May 2023
Summary of Financial Results for 1 the Fiscal Year Ended May 2023 and Earnings Forecast for the Fiscal Year Ending May 2024 Summary of Financial Results for the 1 Fiscal Year Ended May 2023 Earnings Forecast for the Fiscal Year 2 Ending May 2024 Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Righ
Slide 4: Store Opening/Closing Results
Store Opening/Closing Results No. of Full-year store opening and closing results No. of stores as FY May 2023 stores as at end of at end of Opening FY May Hokushinetsu Tohoku Kanto Tokai Kansai Closing FY May 2022 total 2023 [1] Drugstores 819 29 16 19 14 12 90 13 896 [2] Attached dispensing 460 20
Slide 5: Year-on-Year Change in Sales by the Month
Year-on-Year Change in Sales by the Month All stores for current year Existing stores for current year Year-on-year change All stores for previous year Existing stores for previous year in full-year sales 130.0% All stores: 115.9% Existing stores: 105.2% 125.0% 119.8% 119.0% 120.0% 117.0% 118.3% 116
Slide 6: Year-on-Year Change in Number of Customers and Unit Price per Customer
Year-on-Year Change in the Number of Customers and Unit Price per Customer by the Month The number of customers for current year Average spending per customer for current year Year-on-year change in existing stores The number of customers for previous year Average spending per customer for previous
Slide 7: Profit and Loss Statement
Profit and Loss Statement FY May 2022 FY May 2023 Full-year results Full-year plan Full-year results Million yen Sales ratio Million yen Sales ratio Million yen Sales ratio YoY change vs. Plan Sales 328,335 100.0% 360,000 100.0% 378,874 100.0% 115.4% 105.2% Gross profit 89,762 27.3% 100,131 27.8% 10
Slide 8: Results by Area
Results by Area FY May 2022 FY May 2023 Full-year results Full-year results Ratio of Ratio of Composition Number of Composition Number of Million yen stores with Million yen YoY change stores with ratio stores ratio stores dispensaries dispensaries Hokushinetsu 161,993 49.3% 334 66.4% 178,733 47.2%
Slide 9: Results by Product Division
Results by Product Division FY May 2022 FY May 2023 Full-year results Full-year results Composition Composition Composition Million yen Million yen YoY change ratio ratio difference Health 36,409 11.1% 41,021 10.8% -0.3% 112.7% Beauty 48,241 14.7% 51,710 13.6% -1.1% 107.2% Daily commodities 69,091 2
Slide 10: Results of SGA Expenses
Results of SGA Expenses FY May 2022 FY May 2023 Full-year results Full-year plan Full-year results Million yen Sales ratio Million yen Sales ratio Million yen Sales ratio YoY change vs. Plan Labor cost 33,212 10.1% 35,556 9.9% 37,263 9.8% 112.2% 104.8% Sales promotion 2,847 0.9% 3,359 0.9% 2,875 0.8
Slide 11: Balance Sheet
Balance Sheet As of May 20, 2022 As of May 20, 2023 Composition Composition Change from Increase/ Million yen Million yen ratio ratio May 20, 2022 Decrease Cash and deposits 26,348 11.3% 42,870 15.6% 162.7% 16,522 Inventory assets 39,673 16.9% 45,498 16.5% 114.7% 5,825 Current assets 86,547 37.0% 11
Slide 12: Cash Flow Statement
Cash Flow Statement (Million yen) Increase/ FY May 2022 FY May 2023 Decrease Cash flows from operating activities 20,286 31,249 10,963 Cash flows from investing activities -27,771 -22,260 5,511 Cash flows from financing activities 18,098 7,533 -10,565 Cash and cash equivalents at the 26,348 42,870 1
Slide 13: Earnings Forecast for the Fiscal Year Ending May 2024
Summary of Financial Results for 1 the Fiscal Year Ended May 2023 and Earnings Forecast for the Fiscal Year Ending May 2024 Summary of Financial Results for the 1 Fiscal Year Ended May 2023 Earnings Forecast for the Fiscal Year 2 Ending May 2024 Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Righ
Slide 14: Store Opening/Closing Plan
Store Opening/Closing Plan No. of Full-year store opening and closing plan FY May 2024 No. of stores as at stores as at Opening end of FY Hokushinetsu Tohoku Kanto Tokai Kansai Closing end of FY May 2023 Total May 2024 [1] Drugstores 896 26 6 24 4 10 70 5 961 [2] Attached dispensing 526 20 9 17 14 1
Slide 15: Capital Investment Plan
Capital Investment Plan FY May 2023 FY May 2024 Full-year results（Million yen） Full-year plan（Million yen） Lease Lease Acquisition Total Acquisition Total YoY change assets assets Store investment 23,124 2,709 25,832 17,028 2,083 19,111 74.0% (New opening) Store investment 2,228 29 2,257 2,367 - 2,3
Slide 16: Full-Year Earnings Forecast
Full-Year Earnings Forecast FY May 2023 FY May 2024 Full-year results Full-year plan Million yen Sales ratio Million yen Sales ratio YoY change Sales 378,874 100.0% 410,000 100.0% 108.2% Gross profit 106,107 28.0% 113,326 27.6% 106.8% SGA expenses 90,810 24.0% 95,526 23.3% 105.2% Operating income 15
Slide 17: Full-Year Earnings Forecast (1H/2H)
Full-Year Earnings Forecast (1H/2H) FY May 2024 Full-year plan 1H plan 2H plan Million yen Sales ratio YoY change Million yen Sales ratio YoY change Sales 200,000 100.0% 108.5% 210,000 100.0% 107.9% Gross profit 55,472 27.7% 106.8% 57,853 27.5% 106.8% SGA 47,472 23.7% 108.8% 48,053 22.9% 101.9% expe
Slide 18: Plan by Area
Plan by Area FY May 2023 FY May 2024 Full-year results Full-year plan Ratio of Ratio of Composition Number of Composition Number of Million yen stores with Million yen YoY change stores with ratio stores ratio stores dispensaries dispensaries Hokushinetsu 178,733 47.2% 356 67.9% 191,298 46.7% 107.0%
Slide 19: Plan by Product Division
Plan by Product Division FY May 2023 FY May 2024 Full-year results Full-year plan Composition Composition Million yen Composition ratio Million yen YoY change ratio difference Health 41,021 10.8% 40,967 10.0% -0.8pt 99.9% Beauty 51,710 13.6% 56,519 13.8% 0.2pt 109.3% Daily commodities 73,542 19.4% 7
Slide 20: SGA Plan
SGA Plan FY May 2023 FY May 2024 Full-year results Full-year plan Million yen Sales ratio Million yen Sales ratio YoY change Labor cost 37,263 9.8% 39,470 9.6% 105.9% Sales promotion 2,875 0.8% 3,163 0.8% 110.0% cost Real estate cost 28,969 7.6% 30,161 7.4% 104.1% Other expenses 21,701 5.7% 22,732 5
Slide 21: Progress Status of the Third Medium-term Management Plan
2 Progress Status of the Third Medium-term Management Plan (for five years) 1 Overview Results of efforts Made for Two Years and 2 Outlook for the Third Year Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Rights Reserved. 21
Slide 22: Vision2026: Make Life More Convenient, Smile All the Times
Vision2026 Make Life More Convenient, Smile All the Times あなたの町で、「便利な暮らし」と「笑顔につながる健康」を Aiming to become a drugstore that supports “convenient life” 支えるドラッグストアを目指して and “health that makes you smile” in your town Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Rights Reserved. 22
Slide 23: Three Priority Measures to Fulfill Vision 2026
Strategy: Three Priority Measures to Fulfill Vision 2026 1 Transformation to Food & Drug 2 Parallel establishment rate 70% 3 Shift toward the dominant strategy Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Rights Reserved. 23
Slide 24: Numerical Target: Sales of ¥500 billion for FY May 2026
Numerical Target Sales for FY May 2026 ¥500 billion (¥100 Million) 5000 1st 2nd 3rd 4100 3788 3283 3001 3058 2508 2212 1887 1616 1349 1144 931 761 647 539 * Effective from the beginning of the fiscal year ended May 2022, the Company adopted the “Accounting Standard for Revenue Recognition”. Copyrigh
Slide 25: Progress Status of the Third Medium-term Management Plan
2 Progress Status of the Third Medium-term Management Plan (for five years) 1 Overview Results of efforts Made for Two Years and 2 Outlook for the Third Year Copyright2023 KUSURI NO AOKI HOLDINGS CO.LTD. All Rights Reserved. 25
Slide 26: Format Renewal (2020 Model)
Format Renewal (2020 Model) - Starting from October 2020, the 400-tsubo-format has been added as a next-generation format. 450-tsubo-format concessionary (From 2014) 400 tsubo (From 2020) ► Large-size store ► Store opening rate: 10% 300 tsubo ► Suburb, countryside (From 2010) ► Medium-size store ► S
Slide 27: Strong Point of 400-tsubo-format
Strong Point of 400-tsubo-format - Offering fresh food has enabled our customers to enjoy one-stop shopping. - Covering the drugstore market as well as the dispensing and supermarket markets (markets exceeding 30 trillion yen) - Standardized format that allows for multiple store expansion Copyright2
Slide 28: Fresh Food Roll-out in Existing Stores
Fresh Food Roll-out in Existing Stores - Fresh food know-how acquired through the development of the 400-tsubo-format has been applied to the 300-tsubo-format - Renovation plan to introduce fresh food into existing 300-tsubo stores over 3 years (approx. 600 stores) 400 tsubo 300 tsubo Produce Meat N
Slide 29: Percentage of Produce and Meat Sections Introduced
Percentage of Produce and Meat Sections Introduced - Renovate 300-tsubo format and introduce produce and meat sections. - By the end of FY May 2025, make all stores, except small stores, food and drug stores. Ratio of stores with produce and meat sections to total number of stores 100% 90% 80% 70% 6
Slide 30: Low-cost Operation: Transition from High-Low to EDLP
Low-cost Operation - Review store man-hours (shift initiative from headquarters to store operations department) to lower labor cost ratio - Reduce man-hours required for sales floor changes by shifting to EDLP and strengthening regular item sales floors Sales promotion measures Transition from High-
Slide 31: Accelerating Opening of Dispensing Pharmacies
Accelerating Opening of Dispensing Pharmacies - Aim to achieve ratio of stores with dispensaries of 70% by fiscal May 2026. - 66 stores opened in fiscal May 2023 (Plan unachieved), 70 stores are planned to be opened in fiscal May 2024. Ratio of stores with dispensaries at 62.0% the end of fiscal May
Slide 32: New Graduate Recruitment Status
New Graduate Recruitment Status - In fiscal May 2023, 818 new graduates were hired - For fiscal May 2024, 880 persons are planned to be hired. Career positions Mynavi Popular Company Pharmacist recruitment Ranking Hokuriku area recruitment 143 persons 675 persons Ranked first place for the third str
Slide 33: Trends in Number of Newly Opened Stores and Store Opening/Closing Rate
Trends in Number of Newly Opened Stores and Store Opening/Closing Rate - Shift from area expansion and high-speed store opening to multiple stores in the sales areas - Openings of 70 new stores and 70 pharmacies, and renovation of 250 existing stores are planned. - Total investment will amount to a
Slide 34: M&A Execution
M&A Execution - Since the start of M&A in fiscal May 2021, a total of 8 companies have been converted into our subsidiaries or absorbed. - The purpose is to strengthen fresh food merchandizing in each area and to secure well located properties (8 companies: total sales of 26.0 billion yen). March 20
Slide 35: Store Opening Results
Store Opening Results for FY May 2023 - Since fiscal May 2022, we have strengthened dominant strategy in the current sales areas. - Focus on store opening in 5 areas through M&A and by other means FY May 2023: New stores opened / No. of stores at year end by area All areas Hokushinetsu area Newly To
Slide 36: Store Opening Plan for FY May 2024
Store Opening Plan for FY May 2024 - High opening rates in the Hokushinetsu and Kanto areas - We will continue to focus on the opening of stores with the food-centered format. FY May 2024: New stores opened / No. of stores at year end by area All areas Hokushinetsu area Tohoku area To Be Newly Year
Slide 37: Managing cost increases: Introduction of solar power generation
Managing cost increases: Introduction of solar power generation - Measures to address the most important issue of rising electricity costs and efforts to tackle environmental issues - Solar power generation system is to be introduced to 800 stores over three years (until FY May 2026). No. of stores
Slide 38: Performance Summary
Performance Summary FY May 2022 FY May 2023 FY May 2023 Full-year results Full-year plan Full-year results Million yen Sales ratio Million yen Sales ratio Million yen Sales ratio YoY change vs. Plan Sales 328,335 100.0% 360,000 100.0% 378,874 100.0% 115.4% 105.2% Gross profit 89,762 27.3% 100,131 27
Slide 39: Performance Forecast
Performance Forecast FY May 2022 FY May 2023 FY May 2024 Full-year results Full-year results Full-year plan Million yen Sales ratio Million yen Sales ratio Million yen Sales ratio YoY change Sales 328,335 100.0% 378,874 100.0% 410,000 100.0% 108.2% Gross profit 89,762 27.3% 106,107 28.0% 113,326 27.
Slide 40: Make Life More Convenient, Smile All the Times
Make Life More Convenient, Smile All the Times The forward-looking statements in this document, including earnings forecasts, are based on information currently available to the Company and certain assumptions that the Company believes to be reasonable and are not intended as a guarantee that the Co
Kusuri NO Aoki Holdings — FY2023 Earnings Presentation on 6ix