Pan Pacific International Holdings Corporation · TSE:7532
Pan Pacific International — Q1 FY2021 Earnings Presentation
48 slides from Pan Pacific International's earnings presentation, Nov 10, 2020
Slide 1: Q1 Results for FY2021 (41st Fiscal Year, Ending June 2021)
@)PPIH 41st Fiscal Year (Ending June 2021) O1 Results for FY2021 November 10, 2020 Pan Pacific International Holdings Corporation
Slide 2: Index
| INDEX Overview of Q1 results for fiscal year ending June 2021 Director & Executive Officer, CSO & CFO Seiji Shintani Strategy and measures for Q2 of the fiscal year ending June 2021, and beyond President & CEO, Representative Director Naoki Yoshida Director & Managing Executive Officer Hideki Mori
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 Q1 results for fiscal year ending June 2021
Overview of Q1 results for fiscal year ending June 2021
Slide 5: Earnings summary for Q1
| Earnings summary for Q1 [Period: July 1, 2020 - September 30, 2020] 3 months to*! September 2019 Actual Share Actual Share Change YoY SGA 101,488 Operating Recurr Profit attributable to owners of 1 2,544 parent EPS (Yen) 19.81 100.0% 28.6% 23.7% 4.9% 47% 2.9% 3 months to September 2020 418,474 123
Slide 6: Summary report of consolidated financial results for Q1
| Summary report of consolidated financial results for Q1 Although sales declined by 2.4% year-on-year, the Group achieved a record high for its first quarter operating profit at 23.2 billion yen, 10.3% higher than in the same period last year. Discount store operations fought an uphill battle mainl
Slide 7: 4,300 4,200 4,100 4,000 3,900
250 4,300 240 4,200 230 4,100 220 4,000 210 3,900 200
Slide 8: Q1 Retail operations information
| Q1 Retail operations information ; (Unit: Millions of yen) > Domestic retail Don Quijote Nagasakiya UD Retail 3mon ; aa 3 months to 3 months to Sep 2019 Sep 2020 167,474 (19,116) 123,840 (10,493) SGA 37319-36572 (a7) 10,356, 34117 (4,558) 46% 3.9% (0.8%) 3% 5.5% 1.9% > Overseas retail North Americ
Slide 9: Overview of results by corporation (Don Quijote)
| Overview of results by corporation (Don Quijote) nges in operating profit Changes in sales/customer traffic for existing stores <Millions of yen> 9,000 8,000 7,000 6,000 5,000 4,000 0) [8,675 +748 6,462 | i 7 - r (4,712) _ Previous Impactofsales Changesin Changesin Current Qi changeson —_ gross pr
Slide 10: Overview of results by corporation (UNY)
| Overview of results by corporation (UNY) nges in operating profit Changes in sales/customer traffic for existing stores lI \f 120 <Millions of yen> 7,000 = +4,559 6,866 Average customer spending 6,000 - 110 5000/4929) 100 + 4000 - 3,000 - 90 788 UNY Customer counts 2,000 | Sales for existing store
Slide 11: Overview of results for overseas operations (North America, Asia)
| Overview of results for overseas operations (North America, Asia) Changes in operating profit (North America) <Millions of yen> 2,200 2,000 1,800 1,600 1,400 1,200 1,000 800 600 400 200 r +294 1,907 [ +980 | | (42) f 675 Previous Impact of sales Changes in Changesin Current Qi changes on gross pro
Slide 12: Q1 Segment information (by business)
| Q1 Segment information (by business) > Segment overview by business for previous Q1 [Period: July 1, 2019 - September 30, 2019] © (Unit: Millions of yen) ee ACIS! comes Sales to external customers 281,599 128,153 15,172 3,812 428,736 428,736 Internal sales or transfers between 1,404 992 1,024 1,56
Slide 13: Q1 Overview of results by consolidated businesses
| Q1 Overview of results by consolidated businesses [Period: July 1, 2020 - September 30, 2020] nt store operations x 1 281,599 65.7% Home electrical appliances : 21,696 5.1% Miscellaneous household goods 65,125 15.2% Food products 98,753 23.0% Watches and fashion merchandise 42,963 10.0% Sporting g
Slide 14: Status of major assets
| Status of major assets Cash and deposits 179,785 Accounts receivable- Buildings, etc. 264,035 Lease and guarantee 78,624 deposits (Unit: Millions of yen) June 2020 September 2020 Actual Change 480,770 170,321 63,637 188,159 797,420 261,186 323,208 36,768 78,462 1,278,190 (13,368) (9,464) (4,656) 3
Slide 15: Status of major liabilities and net assets
| Status of major liabilities and net assets rent! S 312,227 jotes and accounts payable 148,226 1 Short-term liabilities 25,117 Fixed liabilities 596,005 Corporate bonds 226,542 ng-term loan payables 276,191 ing-term payables under 191 ity accounts receivable Total liabilities 908,232 ee Total and n
Slide 16: Status of cash flows and capital expenditure
| Status of cash flows and capital expenditure > Status of cash flows %1 Cash and equivalents at beginning of period 185,136 Cash flows from operating 10,879 Cash flows from ve ing (9,909) ee cash flow 970 Cash flows from financing 17,682) ae cath and equivalent (17,234) Cash and equivalents at end
Slide 17: Toward sustainable growth
| Toward sustainable growth > ESG initiatives aim at realizing sustainable growth and enhancing corporate value PPIH’s iality > Adoption of renewable energy Some stores have adopted the use of solar power and wind power, and we are —— — reviewing the effectiveness of renewable energy as a future ene
Slide 18: Strategy and measures for Q2 and beyond
Strategy and measures for Q2 of the fiscal year ending June 2021, and beyond 7
Slide 19: Reflecting on the first nine months of 2020
| Reflecting on the first nine months of 2020 After the novel coronavirus infection began spreading rapidly in March, we were able to respond quickly to major changes in consumer behavior (refraining from going out, heightened awareness of hygiene) and the product supply situation. However, although
Slide 20: Q1 topics (Overall)
| Q1 topics (Overall) > Creating a structure to accelerate decision-making In addition to discount store operations, we expanded our business domains to general merchandise store (GMS) operations, overseas retail operations, and other (financial) services, transforming our structure in order to acce
Slide 21: Q1 Topics (MD)
B21 Topics (MD) / + Reaping the benefits of a growth in business scale. + Responding to significant demand in the short-term and changes to supply, as a result of the coronavirus pandemic. + Preparations toward breaking away from a product composition that is gradually becoming standardized (details
Slide 22: 23.1% 21.3% 4.2% 39期 51.3% 25.7% 23.6% 4.9% 40期 45.7% 28.7% 24.9% 4.0% 41期
23.1% 21.3% 4.2% 39期 51.3% 25.7% 23.6% 4.9% 40期 45.7% 28.7% 24.9% 4.0% 41期 42.1% 0% 25% 50% 75% 100%
Slide 23: Approach for supporting stores in the aspect of marketing
| Approach for supporting stores in the aspect of marketing | Before Ce) Product line-up Support for turnover rate Shelving allocation editing Inventory management Sales (Stores) Pricing Study of competitors POP Sales promotion > Support for sales promotion MD MD development of customers Study of co
Slide 24: Q1 Topics (Domestic businesses)
| Q1 Topics (Domestic businesses) > Discount store operations To address the loss of the domestic inbound market and station-front operations due to the coronavirus pandemic, efforts were made to increase customer traffic at all stores. +Price appeal centered on products with low turnover rate (pric
Slide 25: Q1 Topics (Overseas businesses)
| Q1 Topics (Overseas businesses) > Stores Responded to changes in consumer behavior as a result of the coronavirus pandemic, captured alternative demand, and sales are strong -Commenced experiment on the introduction of knowhow to DON DON DONK!I stores North American businesses + Launched three sto
Slide 26: Q1 Topics (Overseas businesses)
Q1 Topics (Overseas businesses) MD -With growing demand in each country by consumers staying at home due to the coronavirus pandemic, the popularity of Japanese agricultural products, especially in Asia, helped to maintain the strong performance. + In pursuit of a balance between high quality and ea
Slide 27: Efforts to address issues (discount store operations)
| Efforts to address issues (discount store operations) 1. Management's understanding Customer numbers are not returning to previous levels, especially for Don Quijote stores in city centers, while “roadside” stores in the suburbs are also registering a gradual decline. 2. Result of analysis Perhaps
Slide 28: Future action plan (UNY, UDR)
| Future action plan (UNY, UDR) We aim to double operating income, which was our previous target, through the group optimization of the indirect organizations of UNY and PPIH, as well as the creation of a general merchandise store business format (New GMS), in addition to promoting the transition of
Slide 29: Future action plan (Overseas businesses)
| Future action plan (Overseas businesses) Store expansion -Based on the concept of “specialty stores for Japanese brands,” we aim to expand stores to give local customers a sense of convenience and ease of shopping, with a focus on Japanese agricultural products. -Preparations for launching new sto
Slide 30: Future action plan (Overseas businesses)
| Future action plan (Overseas businesses) DAV ocMmeeReeSAcuime@e «rough the establishment of PPIC, we will build a system that consolidates the processes from product overseas exports procurement to sales, with the integration of producers, national government, local governments, production organiz
Slide 31: Future Action Plan (Overseas Retail Operations)
| Future Action Plan (Overseas Retail Operations) > About PPIC Passion 2030, the new medium-to-long term management plan of the PPIH Group sets a target for international sales of 1 trillion yen by 2030. The major business driving international sales will be further expansion of the DON DON DONKI st
Slide 32: Q2 Forecast of consolidated results
| Q? Forecast of consolidated results (Unit: Millions of yen) ths to #1 Dec 2019 (Actual) 3 mon (Forecast) Actual Share YoY 858,789 100.0% 846,000 100.0% 98.5% 246,989 28.8% 245,500 29.0% 99.4% SGA 202,680 23.6% 205,500 24.3% 101.4% Operating profit 44,309 5.2% 40,000 47% 90.3% Recurring profit 44,7
Slide 33: Appendix
Appendix 32
Slide 34: Q1 Overview of consolidated statement of income
| Q1 Overview of consolidated statement of income [Period: July 1, 2020 - September 30, 2020] (Unit: Millions of yen) Actual Share YoY 428,736 100.0% 418,474 100.0% 97.6% 122,529 28.6% 123,455 295% 100.8% SGA 101,488 23.7% 100,251 24.0% 98.8% — 35,499 8.3% 37,546 9.0% 105.8% Rent 13,411 3.1% 12,988
Slide 35: Q1 Segment information (by corporation)
| Q1 Segment information (by corporation) > Segment overview by corporation for previous Q1 [Period: July 1, 2019 - September 30, 2019] (Unit: Millions of yen) Sales 186,590 49,488 19,036 134,333 25,338 5,659 5,116 428,736 Operating profit 8,675 1,591 (1,338) 4,929 678 2,140 643 21,042 Total assets
Slide 36: Overview of Q1 results by consolidated business (Comments)
| Overview of Q1 results by consolidated business (Comments) unt store oper The loss of the domestic inbound market was covered by earnings in hygiene products and food products. After billion yen (19) the Bon Festival period, growth was also recorded in leisure products such as fireworks and outdoo
Slide 37: Monthly sales (Don Quijote)
| Monthly sales (Don Quijote) 108 --- 56 a (%) Sales for existing stores j 96 Ddo..~—So Sales for existing stores " Customer counts Average customer 92 -- (excludingtax-free) | | spending [.a-----seaeeecseeeeeeeeneed 80 Sep.2018 > DQ existingstores 95.7 101.1 113.0 93.1 97.8 96.6 99,2 101.2 87.9 89.
Slide 38: Monthly sales (UNY)
| Monthly sales (UNY) TQ anne ene een nnn nnn nn nnn nnenennnnnnnennnnnenennnnnnnnnnnnnnnennnnnnnennnnne (%) UNY 105 --1 Sales for existing stores 100 UNY : without adjustment for day of the week %1 90 - Sep.2018 Mar.20T9 PUNY existing stores May Jun 31. Figures for sales for existing UNY stores hav
Slide 39: About UNY, UDR
B About UNY, UDR > PIAGOPURASU Myokoji Shop (Reopened on June 27 after renovations) *Period of comparison: YoY from July 1 - September 30 Clothing 138.9% YoY a Household 198.3% YoY Food 135.9% YoY ~~ & Achieved 144.0% YoY Drugstore offering solutions to problems APITA CLOTHING Clothing specialty sto
Slide 40: 11 12 1 2 3 4 5 6 7 8 9 10 7 8
120 120 115 115 110 110 105 105 100 100 95 95 90 90 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 転換前 転換後 転換前 転換後 転換前 転換後
Slide 41: Store network
| Store network Qi, FY2021 Fy2020 —-FY2021 22 Ds la iy DON DON DONKI Pearl City store #3 Mini Piago TAY Sep} Don Quijote No. of stores by corporation Shibata store 322 339 342 44 44 44 16 #4 4 44 ve _ " = A Awide variety of seasonal | 7 vegetables and fruits for families! 73 #4 0%6 0 15 O#S 0 Don Qu
Slide 42: Store openings for current period
| Store openings for current period New stores scheduled to be opened: 10 stores in Japan, 8 — 10 stores overseas, and 11 stores for double-name conversion : DQ APITA E Utsunomiy (Tochigi) P_Jan_ Feb Mart Apr May Jun | Kawagoe Higashiguchi (Saitama) Shibata (Niigata) Matsuyama Okaido hime) Pearl Cit
Slide 43: 6,000 2,400 5,500 2,200 5,000 2,000 4,500 1,800 100 4,000 1,600 3,500 1,400 90
6,000 2,400 130 5,500 2,200 120 5,000 2,000 110 4,500 1,800 100 4,000 1,600 3,500 1,400 90 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q
Slide 44: IR information
| IR information IR inquiries Pan Pacific International Holdings Corporation, IR Department + 153-0042 2-19-10 Aobadai, Meguro-ku, Tokyo TEL: 03-5725-7588 FAX: 03-5725-7024 e-mail : ir@ppih.co.jp IR calendar Announcement of Q2 results for the fiscal year ending June 2021 (Scheduled) Date of announce
Slide 45: Memo
Slide 46: Memo
Slide 47: Memo
Slide 48: Pan Pacific International Holdings
f a ) Pan Pacific International Holdings TF 153-0042 2-19-10 Aobadai, Meguro-ku, Tokyo TEL: 03-5725-7588 / FAX: 03-5725-7024 / e-mail: ir@ppih.co.jp https://ppih.co.jp/
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