Pan Pacific International Holdings Corporation · TSE:7532
Pan Pacific International — Q2 FY2021 Earnings Presentation
44 slides from Pan Pacific International's earnings presentation, Feb 10, 2021
Slide 1: Q2 Results for FY2021
41st Fiscal Year (Ending June 2021) Q2 Results for FY2021 February 10, 2021 Pan Pacific International Holdings Corporation
Slide 2: Agenda
B invex Overview of Q2 results for fiscal year ending June 2021 Director & Executive Officer, CSO & CFO Seiji Shintani ps Outlook for the full fiscal year ending June 2021 Director & Managing Executive Officer Hideki Moriya Strategy and measures for the future Ei President & CEO, Representative Dire
Slide 3: Explanatory notes for these materials
Explanatory notes for these materials 1, The monetary values presented in these materials are rounded off to the nearest full unit. 2. The following abbreviations are used in these materials: Pan Pacific International Holdings (7532) as “PPIH,” Don Quijote Co., Ltd. and its stores as “DQ,” UNY Co.,
Slide 4: Overview of Q2 results for fiscal year ending June 2021
Overview of Q2 results for fiscal year ending June 2021
Slide 5: Earnings summary for 1H
| Earnings summary for 1H (Unit: Millions of yen) Forecast for ome: ons 201 5 hs to Dec 2020 Compared to 6 mot Dec 2019 Compared to forecast Actual Share Actual Share Actual Share 858,789 100.0% 846,000 100.0% 852,861 100.0% (5,928) 99.3% 6,861 100.8% 246,989 28.8% 245,500 29.0% 251,194 29.5% 4,205
Slide 6: Summary report of consolidated financial results for 1H FY2021
| Summary report of consolidated financial results for 1H FY2021 Net sales for 1H of the current fiscal year were 852.9 billion yen (down 0.7% compared with the previous quarter). The impact of no tax-free sales and the exclusion of two consolidated subsidiaries was significant at -45.8 billion yen.
Slide 7: Consolidated financial results for 1H FY2021 (Operating profit)
| Consolidated financial results for 1H FY2021 (Operating profit) Out of the 49.3 billion yen in operating income for 1H FY2021, after subtracting special factors (period shift of SG&A expenses and a decrease in SG&A expenses due to special factors relating to COVID-19) 45.0 billion yen was evaluate
Slide 8: 1H FY2021 YoY comparison by retail location
| Consolidated financial results for 1H FY2021 YoY comparison by retail location Net Sales Changes Operating Profit Changes <Million Yen> <Million Yen> 870,000 53,000 858,789 +6,212 ~ 41gggs 852,861 50000 Ff +4603 49,329 850,000 _ . +2,082 +110 = 29,145 7082 TN +826 (14,844) _ a _ 44,309 asm) eed 83
Slide 9: 1H Retail operations information
| 1H Retail operations information (Unit: Millions of yen) 6 months to 6 months to 6 months to 6 months to Dec 2020 Ven? Dec2020 Ye Dec 2020 Ye Dec 2020 Ye 366,878 338,005 (28,873) 97,628 97,738 110 43,090 88,683 45,593 272,952 «256,505 (16,447) 90324 84,204 ~— (6,120) (23,770 24,011 241 10,064 2282
Slide 10: 前2Q 売上増減に 総利益率 販管費の 当2Q (累計) 伴う粗利影響 の変動 変動 (累計)
前2Q 売上増減に 総利益率 販管費の 当2Q (累計) 伴う粗利影響 の変動 変動 (累計)
Slide 11: 前2Q 売上増減に 総利益率 販管費の 当2Q (累計) 伴う粗利影響 の変動 変動 (累計)
前2Q 売上増減に 総利益率 販管費の 当2Q (累計) 伴う粗利影響 の変動 変動 (累計)
Slide 12: Overseas business overview (North America, Asia)
| Overseas business overview (North America, Asia) Changes in operating profit (North America) <Million Yen> 5,000 4,500 + 4,000 + 3500 fo 3,000 fn 2,500 + 2,000 + 1,500 1,262 1,000 + 500 F 0 Impact of sales Changes in gross Changes changes on gross. profitmargin in SG&A profit Previous 1H Current 1
Slide 13: 1H Segment information (by corporation)
| 1H Segment information (by corporation) > Segment overview by corporation for previous 1H [Period: July 1, 2019 - December 31, 2019] (Unit: Millions of yen) aa _ _ 4 4 4 3 * “5 Sales 366,878 97,628 43,090 272,952 52,282 11,291 10,452 858,789 fit 14,855 3,044 (2,876) 15,119 966 4,289 1,356 44,309 3
Slide 14: 1H Segment information (by business)
| 1H Segment information (by business) > Segment overview by business for previous 1H [Period: July 1, 2019- December 31, 2019] 3 (Unit: Millions of yen) ~ _— B Sales to external _ 560,953 260,564 29,705 7,567 858,789 858,789 2,847 2,179 2,037 3,373 10,436 (10,436) _ 563,800 262,743 31,742 10,940 86
Slide 15: Status of major assets
| Status of major assets (Unit: Millions of yen) Dec. 2020 Status of major asse > Total assets: 1,362.0 billion yen (+64.8 billion yen) 494,138 565,174 71,036 Cash and deposits and merchandise tend to increase at the end of December compared to the end of June due to it being a busy season in the re
Slide 16: Status of major liabilities and net assets
| Status of major liabilities and net assets (Unit: Millions of yen) Status of major liabilities et assets “1 > Interest-bearing debt: 521.3 billion yen (down 6.5 billion yen) > Net D/E ratio: 0.79x 148,226 194,923 46,697 > Interest coverage ratio: 19.8 times *3 > ROE: 17.0% (annualized) < Current L
Slide 17: Status of cash flows and capital expenditure
| Status of cash flows and capital expenditure > Cash Flow Status *! (Unit: Millions of yen) 6 months to 6 months to Dec. 2! Dec. 2019 Cash Flow Actual lange Operating Cash Flows > Increases of 48.5 billion yen in income before income taxes and Balance at Beginning of Period 185,136 183,602 (1,534)
Slide 18: Toward sustainable growth
| Toward sustainable growth > Efforts to strengthen governance (1) Nomination and Renumeration Committee (Established on January 19, 2021) (2) Diversity Management Committee (Established on November 10, 2020) (3) Training and Education Framework The Nomination and Renumeration Committee was establis
Slide 19: Outlook for the full fiscal year ending June 2021
Outlook for the full fiscal year ending June 2021 : Full year forecast of consolidated results Sales topics 18
Slide 20: Full year forecast of consolidated results
| Full year forecast of consolidated results The full year consolidated earnings forecast was revised as follows: No change in sales, upward to 80 billion (+3 billion) in operating profit, 79 billion (+3 billion) in recurring profit, and 53 billion (+2 billion) in net income. (Unit: Millions of yen)
Slide 21: Sales topics (Domestic business)
| Sales topics (Domestic business) > Discount Store Business Demand for events that require people to go out, such as Halloween and Christmas, declined significantly in the second quarter. However, sales of products that suit “new normal’ lifestyles increased due to the prolonged COVID-19 epidemic.
Slide 22: ▶ 転換前 転換後 転換前 転換後 転換前 転換後 転換前 転換後
▶ 転換前 転換後 転換前 転換後 転換前 転換後 転換前 転換後
Slide 23: Sales topics (Overseas business)
| Sales topics (Overseas business) > Asia Our Asian businesses performed well due to support from customers. In the second half of the year, we plan to open seven new stores and launch in two new regions. We will expand to 19 stores in five countries and regions by the end of March 2021. Opened Nove
Slide 24: Strategy and measures for the future
Strategy and measures for the future * Discount store business * Productivity improvement - Implement measures to strengthen MD and PB * Overseas business * Digital strategy 23
Slide 25: Discount store business
| Discount store business (Reprint) On-site support as management Million Star system Human support Productivity improvements Support for MD policies Strategic pricing Note: Consolidated Financial Results for Q1 FY2021 » Establishment of a sales system centered on the Million Star System Million Sta
Slide 26: Increased productivity
| Increased productivity f -Will streamline operations at stores by focusing on five measures to increase the amount of time spent on spot negotiations, competitive research, pricing, and creating buying spaces. - Goal is to create 1 million hours in the fiscal year ending June 30, 2021, and 3 milli
Slide 27: ？ 3,500 3,000 2,500 2,000 1,500 1,000 9
？ 3,500 21 3,000 19 2,500 17 2,000 15 1,500 13 1,000 11 500 9
Slide 28: 3,500 3,000 2,500 2,000 1,500 1,000 500 50 0 0
3,500 350 3,000 300 2,500 250 2,000 200 1,500 150 1,000 100 500 50 0 0
Slide 29: Digital strategy
| Digital strategy Respond to changes in consumer behavior and provide new services by acquiring more members for majica app. Changes in competition, customers and our strategy Expanding customer contact and service with apps Conventional New changes Example: Example: Product E nmerce site incompett
Slide 30: Digital strategy
| Digital strategy Evolve the app to provide new services (details to be announced during FY ending June 2021). Services Payment majica Points majica Points Charge with Geen majicadonpen lintels) Card $7,000ns7 LE > H! OF 2 m Applications Financing None Store Campaign Information Coupons E-commerce
Slide 31: Appendix
Appendix 30
Slide 32: Q2 overview of consolidated statement of income
| Q2 overview of consolidated statement of income (Unit: Millions of yen) 3 months to Dec 2019 3mo — 434,387 100.0% 4,334 101.0% 127,739 29.4% 3,279 102.6% 101,614 23.4% 422 100.4% 26,125 6.0% 2,858 112.3% 25,386 5.8% 993 104.1% 16,168 3.7% 349 102.2% *1, As the method for the valuation of inventori
Slide 33: 440,000 27,000 420,000 25,000 400,000 23,000 380,000 360,000 21,000 ・ ・ ・ ・
440,000 27,000 420,000 25,000 400,000 23,000 380,000 360,000 21,000 ・ ・ ・ ・
Slide 34: Q2 retail operations information
| Q2 retail operations information (Unit: Millions of yen) 3 months to 3 months to YoY 3 months to 3 months to 3 ) 3 months to 3 months to 3 months to YoY Dec 2019 Dec 2020 ° Dec 2019 Dec 2020 Dec 2020 ° Dec 2019 Dec 2020 ~ Sales *1 "180,288 170,531 (9,757) © 48,140 49,559 (5,954) 1419 43:0 ata ats)
Slide 35: 1H overview of results by consolidated businesses
| 1H overview of results by consolidated businesses (Unit: Millions of yen) m s to Dec 2019 6 months to Dec 2020 Actual Share Actual Share YoY Discount store operations a 560,953 65.3% 579,345 67.9% 103.3% - Home electrical appliances 43,612 5.1% 45,305 5.3% 103.9% Miscellaneous household goods 123,
Slide 36: Comments on consolidated business results in 1H
| Comments on consolidated business results in 1H [Period: July 1, 2020 - December 31, 2020] Discount store businesses: 579.3 billion yen (43.3% YoY) > Home electronic appliances: 45.3 billion yen (+3.9% YoY) > Daily necessities: 112.0 billion yen (-9.5% YoY) > Food products: 262.2 billion yen (411.
Slide 37: Breakdown of SG&A
| Breakdown of SG&A [Period: October 1, 2020 - December 31, 2020] (Unit: Milions of yen) 3 months to Dec 2019 *1 3 months to Dec 2020 101,192 23.5% 101,614 23.4% 100.4% Salaries and allowances 36,260 8.4% 37,790 8.7% 104.2% Rent 13,545 3.1% 13,301 3.1% 98.2% Commission paid 15,840 3.7% 14,737 3.4% 9
Slide 38: １ ▶ ※１ ％ ％ ＋ ＋ ＋ 90 90 1 2 3 4
１ ▶ ※１ 120 120 ％ ％ 115 115 110 110 105 105 ＋ 100 100 ＋ 95 95 ＋ 90 90 1 2 3 4 5 6 7 8 9 10 11 12 1 1 2 3 4 5 6 7 8 9 10 11 12 1 ２ ▶ 転換前 転換後 転換前 転換後 転換前 転換後
Slide 39: Store openings for current period
Store openings for current period 9 new stores has been opened during this 1H. New store openings for the full year: 13 stores in Japan, 8 to 10 stores overseas, and 11 UDR conversion stores (including scheduled openings). : ee ee format jul [Aug [sep | Nov Kawagoe ‘ Matsuyama | [Sevenpark Ario |<),
Slide 40: Store network
| Store network No. of stores by format No. of stores by corporation FY2021 1Q 2Q Don Quijote 212 225 225 228 322 339 342 346 MEGA 44 44 44 45 44 44 44 44 New MEGA 88 91 91 92 16 41 44 48 16 a1 44 48 176 150 147 143 FY2021 FY2019 FY2020 FY2019 FY2020 4 4 o*7 0 Picasso 73 Ors (0) 0 MiniPiago 15 O*6 (
Slide 41: FY2016 FY2017 FY2018
700 14,000 600 12,000 500 10,000 400 8,000 300 6,000 200 4,000 100 2,000 0 0 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 2Q ■ ■ ■ ■ ■ 100% 19.0% 15.1% 17.5% 14.7% 15.9% 18.6% 19.3% 19.2% 22.7% 20.6% 24.0% 80% 7.8% 7.7% 7.7% 7.9% 7.7% 7.7% 8.0% 7.7% 7.7% 17.8% 18.1% 60% 51.5% 56.1% 64.6% 62.5% 40% 74.0
Slide 42: ▶ 6,000 2,400 5,500 2,200 2,000 5,000 1,800 4,500 100 1,600 4,000 1,400 90
▶ 6,000 2,400 130 5,500 2,200 120 2,000 5,000 110 1,800 4,500 100 1,600 4,000 1,400 90 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q
Slide 43: IR information
| IR information IR inquiries Pan Pacific International Holdings Corporation, IR Department T 153-0042 2-19-10 Aobadai, Meguro-ku, Tokyo TEL: 03-5725-7588 FAX: 03-5725-7024 email : ir@ppih.cojp IR calendar Announcement of Q3 results for the fiscal year ending June 2021 (Scheduled) Date of announceme
Slide 44: Pan Pacific International Holdings
f a ) Pan Pacific International Holdings T 153-0042 2-19-10 Aobadai, Meguro-ku, Tokyo TEL: 03-5725-7588 / FAX: 03-5725-7024/ e-mail: ir@ppih.cojp https://ppih.co,jp/
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