Pola Orbis Holdings Inc. · TSE:4927
Pola Orbis — Q3 2021 Earnings Presentation
23 slides from Pola Orbis's earnings presentation, 2021
Slide 1: Third quarter FY2021 financial results briefing
We will now begin the financial results briefing for the third quarter of fiscal year ending December 31, 2021.
Slide 2: Pola Orbis Holdings agenda
KKK POLA ORBIS BkR HOLDINGS Highlights of Consolidated Performance Segment Analysis Forecasts for Fiscal 2021 Initiatives Going Forward & Appendices Pwnh>
Slide 3: Highlights of consolidated performance
The domestic market as a whole, including exports, is shrinking. The domestic market has been affected by the rapid spread of the COVID-19 throughout the country this summer and the prolonged state of emergency that has accompanied it. The Chinese market has been temporarily affected by the COVID-19
Slide 4: Consolidated P&L explanation
The following is an explanation of consolidated P&L. Consolidated net sales increased, mainly in POLA's overseas business, to JPY131.1 billion. Sales increased by 4.3%. The cost of sales ratio is improving due to an increase in the contribution of POLA's high price range products. As for SG&A expens
Slide 5: Ordinary income and net income
Ordinary income increased by 72.8% to JPY13.4 billion. Quarterly net income increased by 453% and reached JPY8.6 billion. Include an increase in non-operating income due to foreign exchange gains of around JPY1.1 billion caused by the depreciation of the Japanese yen against the Australian dollar. E
Slide 6: Factors behind net income evolution
On this page, the graph showing the factors behind the evolution of net income. Next, please turn to page eight.
Slide 7: Agenda: Segment Analysis
KKK POLA ORBIS BkR HOLDINGS Highlights of Consolidated Performance Segment Analysis Forecasts for Fiscal 2021 Initiatives Going Forward & Appendices PwNnN >
Slide 8: Segment Results
KEK POLA ORBIS Bok HOLDINGS Segment Results FY2020 FY2021 YoY Change (mil yen) Q3 Results (YTD) Q3 Results (YTD) Amount Consolidated net sales 125,814 131,164 5,349 4.3% Beauty care 122,295 127,834 5,539 4.5% Real estate 1,763. 1,581. (182) (10.3%) Others 1,755 | 1,748 | (7) | (0.4%) Operating incom
Slide 9: Beauty care business results by brand
Here are the results by brand for the beauty care business. Overall, sales in the beauty care business have increased by 4.5%. And operating income has increased by 45.7%. In terms of net sales, with the exception of ORBIS in the brand division as you see, sales have increased, and POLA posted a sub
Slide 10: POLA sales and operating income
Sales at POLA have increased by 5.8% to JPY77.1 billion. Operating income increased by 64% to JPY11.7 billion. Although sales in the consignment sales channel have decreased by 3% due to the impact of the rapid spread of the COVID-19 in Japan in the third quarter, overseas business remained strong.
Slide 11: ORBIS sales and operating income
Sales at ORBIS have declined by 2.3% to JPY32.5 billion. Operating income has decreased by 17% to JPY4.4 billion. Although cumulative sales have decreased due to a decline in the number of customers, purchase per customer has recovered, and sales have increased during the three months of Q3, mainly
Slide 12: Jurlique and H2O PLUS loss improvement
Loss improvement was achieved for both Jurlique and H2O PLUS. Jurlique continued to face difficult conditions in Australia, including store closures due to lockdowns, but sales in Mainland China and other Asian countries grew steadily, with e- commerce sales in very good shape.
Slide 13: THREE and DECENCIA results
THREE continues to be severely impacted offline by the prolonged state of emergency at department stores etc. On the other hand, DECENCIA focused on improving lifetime value, resulting in an increase in sales. Profits are as shown in the table. Next, in page 16, I am going to talk about our initiati
Slide 14: Agenda: Forecasts for Fiscal 2021
KKK POLA ORBIS BkR HOLDINGS Highlights of Consolidated Performance Segment Analysis Forecasts for Fiscal 2021 Initiatives Going Forward & Appendices PWN >
Slide 15: Forecasts for Fiscal 2021 (Unchanged)
KEK POLA ORBIS HOLDINGS Forecasts for Fiscal 2021 (Unchanged) The forecast remains unchanged, but the impact of COVID-19 is persisting longer than anticipated Make effort to bring results closer to the initial plan with a recovery through measures such as cost rationalization FY2021 (mil. yen) Q3 Re
Slide 16: Agenda: Initiatives Going Forward
KKK POLA ORBIS BkR HOLDINGS Highlights of Consolidated Performance Segment Analysis Forecasts for Fiscal 2021 Initiatives Going Forward & Appendices Pons
Slide 17: Initiatives for Q4 onward: POLA and ORBIS
POLA will launch a series of limited-edition kits from the main skincare series, such as WRINKLE SHOT and B.A, in an effort to revitalize customer base. We are also planning to launch a new app in November, mainly to attract new customers. The idea is to gradually grow this app into an OMO platform,
Slide 18: Initiatives for Fiscal 2021 Q4 onward: overseas and developing brands
KKK EE Pot A oe Initiatives for Fiscal 2021 Q4 onward Overseas Brands Jurli ue @ Implement a new brand strategy as a Holistic & Conscious brand q Planning to open a new store in Australia embodying the brand concept Image of the new Jurlique store. H 2 Or @ Enhance the efficiency of customer acquisi
Slide 19: About POLA ORBIS Group
was zee POLAORBIS (appendix) About POLA ORBIS Group Beauty care is the core business of the Group, and 10 different cosmetics brands are operated under the Group umbrella FY2020 Consol. Net Sales ¥176.3 bil. Overseas Flagship Brands under | Brands: Brands | development ¥20,000 1 H . High Prestige ur
Slide 20: Beauty Care Business Brand Portfolio
EE POLA ORBIS (Appendix) Beauty Care Business Brand Portfolio One| | | Sse [eran | Concept and products Main sales channel Pp fe) LA ™ High-prestige skincare Approx. JP: Consignment sales, department stores and e-commerce 60% ™ Leading-edge technology In aging- ¥10,000 =m _~Overseas: Department stor
Slide 21: Improvement in Capital Efficiency and Shareholder Returns
KKK POLAORBIS (Appendix) Improvement in Capital Efficiency EEE HOLDINGS and Shareholder Returns Initiatives to Improve Capital Efficiency ROE movement (%) ™ Operating income CAGR 30% 16.0 14.2 ™@ Achieve net income growth ° EPS which is higher than operating Target for 2023 (Eamings per share) incom
Slide 22: 2021-2023 Medium-term Management Plan
KEE Por A ORBIS (Appendix) 2021 — 2023 Medium-term Management Plan Management Indicators for 2023 H Consolidated net sales = ¥215.0 to 225.0 bil. in FY2023 CAGR 7 to 9% Net Sales @ Overseas sales ratio = 20 to 25% in FY2023 (15% in FY2020) caGR 20 to 25% @ Domestic e-commerce = 30% in FY2023 (24% in
Slide 23: Beauty Care Business Results FY2018-FY2020 by Brands
KKK POLAORBIS (Appendix) Beauty Care Business Results EEE HOLDINGS for FY2018 — FY2020 by Brands i FY2018 i FY2019 : 1m 40720) (mil. yen) Results Results Results : i Consolidated net sales 248,574 219,920 176,311 (43,609) ore 231,207 214,886. 171,658 (43,228) SO eee eee 750,183 | ce 195,602 a "102.8