Village Vanguard Co., Ltd. · TSE:2769
Village Vanguard — FY05/10 Earnings Presentation
32 slides from Village Vanguard's earnings presentation, 2010
Slide 1: FY05/10 Results Presentation
FY05/10 Results l Presentation i © Village Vanguard Corporation, All rights reserved.
Slide 2: Note
Note: Any current plans, forecasts, strategy projections, expressions of confidence and other statements made byy us in these materials are premised on the information that was available at the moment of the initial publication and on models that depend on uncertain factors that could impact future
Slide 3: P&L (Consolidated)
P&L (Consolidated) Income Statement FY05/09 FY05/10 FY05/11 Est (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Est Q2 Est Q3 Est Q4 Est Sales 7,343 7,462 9,739 8,682 8,630 8,273 10,290 9,456 9,274 8,955 11,006 10,175 SG&A 2,270 2,723 2,798 2,831 2,799 2,879 3,069 3,117 3,177 3,337 3,487 3,570 Labor 995 1,
Slide 4: BS (Consolidated)
BS (Consolidated) Balance Sheet FY05/09 FY05/10 FY05/11 Est (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Est Q2 Est Q3 Est Q4 Est Cash & Deposit 2,750 2,387 3,011 3,078 2,685 2,957 3,503 4,037 3,571 3,570 3,163 3,589 Inventories 11,340 13,711 13,881 14,131 15,003 15,928 15,315 15,466 16,064 17,223 17,14
Slide 5: CF (Consolidated)
CF (Consolidated) Cash Flow Statement FY05/09 FY05/10 FY05/11 Est (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Est Q2 Est Q3 Est Q4 Est Operating Cash Flow -419 -533 -1,758 -735 -292 -146 298 1,647 -365 -608 -1,268 220 Change in Inventories -412 -2,783 -2,953 -3,203 -872 -1,796 -1,183 -1,335 -505 -1,663
Slide 6: Parent Company Village Vanguard Corporation
Parent Company Village Vanguard Corporation © Village Vanguard Corporation, All rights reserved. P.6
Slide 7: What We Do
What We Do ■Village Vanguard ■Diner Burger shop modeled after an American diner. ■QK ■new style 「Exciting book store for kids」 ■Online For 30 year-olds year olds with unique tastes. Book accessories Book, accessories, CDs – 2,500 2 500 items. items Not only toys. ‘Kids Entertainment’ for kids. © Vil
Slide 8: Examples of Our Merchandising Approach (1)
Examples of Our Merchandising Approach (1) Set for making BAR JAZZ CD cocktails “You are not going Compilation to invoke a bar home tonight tonight, my atmosphere Darling!” ”Cocktail Cocktail Book” Book “Rolling g Coaster” ”To the Bar” Selection of 64 bars Pour someone a drink and roller-skate it to
Slide 9: Examples of Our Merchandising Approach (2)
Examples of Our Merchandising Approach (2) © Village Vanguard Corporation, All rights reserved. P.9
Slide 10: Examples of Our Merchandising Approach (3)
Examples of Our Merchandising Approach (3) © Village Vanguard Corporation, All rights reserved. P.10
Slide 11: How We Sell?
How We Sell? We delegate both purchasing and sales decisions to the store level Marketing M k ti -Pursue customer need in each store Store manager has Purchasing the absolute discretion -Reflect customer needs directly -Individualistic challenge to discover new needs Proposition -POP, zone creation
Slide 12: Hiring Strategy
Hiring Strategy Fullll Time Customer Temp Staff Employee We hire people who really understand what we do Even temporary staff are allowed to make purchasing decisions g that spans years Real On-the-Job training © Village Vanguard Corporation, All rights reserved. P.12
Slide 13: Store Openings (Parent)
Store Openings (Parent) Nationwide 334 Figures: Directly Managed, Tohoku (Franchise Stores) The breakdown of DM stores Hokkaido DM 21 DM 309 does not include format conversions DM 16 FC 1 FC 2 Aomori VV 265 5 new style 25 Hokkaido Akita QK 9 Iwate 18（2） 4 5 Diner 10 ＦＣ 25 Hokuriku Yamagata Miyagi 6（
Slide 14: Parent Income Statement
Parent Income Statement Income Statement FY05/09 FY05/10 FY05/11 Est. (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Est. Q2 Est. Q3 Est. Q4 Est. Sales 7,096 7,144 9,438 8,397 8,271 7,827 9,888 9,008 8,729 8,297 10,464 9,637 Gross Profit 2,821 2,880 3,739 3,506 3,351 3,130 3,994 3,582 3,496 3,321 4,088 3,
Slide 15: Comparable Store Sales
Comparable Store Sales 0.0% -0.5% -2.0% 2.7% -2 7% -4.0% -3.2% -3.4% -4.0% -3.9% -4.2% -4.7% -6.0% -6.1% -6.3% -7.0% -8.0% Comparable-Store (FY05/10) -7.6% Comparable-Store (FY05/11) -10.0% -9.8% -12.0% Feb-10 Oct-09 Dec-09 Apr-10 Jun-09 Jun-10 Aug-09 © Village Vanguard Corporation, All rights reser
Slide 16: Comparable Store Sales (by Format)
Comparable Store Sales (by Format) Sales by Format FY05/08 FY05/09 FY05/10 (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Total 5,412 10,761 17,878 24,363 6,442 12,483 20,268 27,134 6,734 13,353 22,497 30,695 Comp Stores YoY 8.2% 8.1% 7.2% 6.4% 3.9% 2.5% 1.5% 0.2% -5.7% -6.5% -5.6% -4.9% Village
Slide 17: Category Sales
Category Sales Sales by Category FY05/08 FY05/09 FY05/10 (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 SPICE (Parent) 4,304 4,077 5,546 5,011 5,109 5,243 7,102 6,310 6,193 5,926 7,785 6,904 Books (Parent) 1,025 988 1,118 1,044 1,038 1,041 1,171 1,087 1,045 997 1,147 1,117 NM (Parent) 673 743 914
Slide 18: Store Age Sales YoY
Store Age Sales YoY Year In Operation 6th and Older 5th 4th 3rd 2nd 1st (Directly Managed Stores) Number of Stores 117 35 39 24 59 35 YoY Sales (%) -6.5% -4.2% -1.6% -2.6% -6.6% - *excluding online and closed stores © Village Vanguard Corporation, All rights reserved. P.18
Slide 19: OP Analysis
OP Analysis （Million Yen） Operating profit from new stores (<13 months in operation) 876 million yen Decline in OP from Comps -448 448 million yen OP Impact from Other Sales (sales to FCs, subs) 3,800 Main reasons: 77 million yen Lower profitability of Comps : -409 million yen 3,600 Decline due to s
Slide 20: Store Openings (Incl. Titicaca Subsidiary)
Store Openings (Incl. Titicaca Subsidiary) New Openings & Closures FY05/08Act FY05/09Act FY05/10Act FY05/11Est FY05/11Est FY05/11Est Full-Year Full-Year Full-Year 1H 2H Full-Year Openings Village Vanguard 22 42 30 19 16 35 new style 3 8 1 0 0 0 QK 1 5 0 0 0 0 Diner 1 4 1 0 0 0 Titicaca 0 12 16 4 4 8
Slide 21: Theme 1: Dedicated area manager system
Theme 1 Grow sales by introducing dedicated area manager system Goal Boost sales by enhancing individual stores’ ability to identify and solve issues Till February 2010 From March 2010 “Playing Managers” “Dedicated Area managers” Positives: Positives: Develop store operation skills • More frequent o
Slide 22: Theme 2: Two-team HQ Sourcing Division
Theme 2 Boost gross profits by introducing 2-team HQ Sourcing Division structure 60.6% 60.3% 58.8% ■ Large staff increases 59.9% Visiting sales staff: 8 in FY05/10 => 20 in FY 05/11 57% 59.3% 58.3% 56.0% 54.6% 55.6% 56.4% Product development staff: 4 in FY05/10 => 8 in FY 05/11 55.1% 55.8% 49 1% 49.
Slide 23: Theme 3: Impact of organizational changes
Theme 3 Impact of organizational changes (Themes 1 & 2) in FY03/11 Costs are included in FY03/11 budget but any positive effects are not Theme 1 Theme 2 Dedicated area managers Two HQ sourcing teams Impact to FY03/11 Cost increase of 450 million yen Cost increase of 150 million yen (included in budg
Slide 24: Theme 4 Inventory Control
Theme 4 Inventory Control FY05/08 FY05/09 FY05/09 FY05/09 FY05/09 FY05/10 FY05/10 FY05/10 FY05/10 （Million Yen） Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Cash Flows From Operations 1,076 -393 -565 -1,694 -669 -197 -173 380 1,756 ■Net Income Before Tax 2,917 744 1,116 2,276 3,149 821 1,320 2,498 3,256 ■Net Increase
Slide 25: © Village Vanguard Corporation, All rights reserved.
© Village Vanguard Corporation, All rights reserved. P.25
Slide 26: Outside Titicaca Stores
Outside Titicaca Stores LaLaport Shin Misato Shibuya store Lake Town store store (Saitama) (Tokyo) (Saitama) Early days Now Started as a folk art shop shop, Warm and natural store Image of a Mexican resort with its signs and store interior, offsetting colorful hotel. Exciting store that fixtures han
Slide 27: Inside Titicaca Stores
Inside Titicaca Stores Apparel Accessories Silver Accessories © Village Vanguard Corporation, All rights reserved. P.27
Slide 28: Titicaca – Results
Titicaca – Results Income Statement Titicaca FY05/09 FY05/10 FY05/11 Est. Income Statement (Million Yen) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Est. Q2 Est. Q3 Est. Q4 Est. S l Sales 251 322 306 299 361 474 416 467 530 643 519 529 Operating Profit 10 26 7 -7 23 55 -10 -2 35 70 8 -7 Recurring Profit 8 21 5 -9 20
Slide 29: Titicaca – Performance Report
Titicaca – Performance Report 1) Sales 3.3% below the budget (58m yen miss) Comps +0.6%（+4.8m +0 6%（+4 8m yen） New Stores -10 10.6% 6% ((-87m 87m yen) Wholesale Sales and FC+8.3％ （10.8m yen） Event （+12.6m yen） New Stores ⇒ Negative impact of 43m yen from stores within one year from opening (7.1% bel
Slide 30: Titicaca – Performance Report
Titicaca – Performance Report 2) Shortfall in GPM budget -2.4％ vs. budget (-28 million yen vs. budget） Clothing 衣料 Import sundries 輸入雑貨 Silvers Merchandize from domestic シルバー 国内他社商材 outside suppliers Factor Reverse of sales proportion among genre ⇒ 40.0% ① High COGS merchandize from domestic outside
Slide 31: Company Profile
Company Profile Village g Vanguard g (Hong ( g Kong) g) Limited （Consolidated from FY05/11） P.32 © Village Vanguard Corporation, All rights reserved.
Slide 32: TOPICS
TOPICS ■ Stores: FY05/11 Plan (units: million yen) #1 opened on Nov. 2009 at JUSCO Kornhill Q1 Q2 Q3 Q4 #2 opened on Dec. 2009 at Dragon Center Sales 51 102 162 209 #3 opened on Jun. 2010 at Megabox Operating -11 -17 -20 -26 Profit ■Themes for current FY Found successful ‘Village g Vanguard’ g store