Workman Co., Ltd. · TSE:7564
Workman — Q2 FY3/2023 Earnings Presentation
26 slides from Workman's earnings presentation, Nov 8, 2022
Slide 1: Materials for Briefing Session on Financial Results for Q2 FY Ending March 2023
（7564） WORKMAN CO., LTD. Materials for Briefing Session on the Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2023 November 8, 2022
Slide 2: Briefing Contents
Briefing Contents ●Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2023 3 ●Overview of Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2023 7 ●Plans for the Fiscal Year Ending March 31, 2023 17 ©2022 WORKMAN CO.,LTD. All Rights Reserved 2
Slide 3: Financial Results for the Second Quarter
Briefing Contents ●Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2023 ©2022 WORKMAN CO.,LTD. All Rights Reserved 3
Slide 4: Cumulative income statement
Cumulative income statement （Millions of yen） FY3/22 FY3/23 YoY FY3/23 Vs. ➢ Financial Results Highlights Q2 Ｑ2 （％） Q2 Plans Plans ●Sales at all chain stores Sales at all chain ・Blessed with the easing of COVID-19 restrictions and fair weather, stores 73,756 81,928 +11.1 79,995 +2.4 sales fared well
Slide 5: Cumulative Selling, General and Administrative Expenses (SG&A)
Cumulative Selling, General and Administrative Expenses (SG&A) SG&A SG&A ➢ Factors of increase/decrease FY3/22 FY3/23 (Millions of yen) ratio ratio Change YoY (％) Q2 （％） Q2 （％） ●Labor cost The average number of employees during the quarter +14 Sales at all chain stores 73,756 － 81,928 － － +11.1 ●Fre
Slide 6: Balance Sheet
Balance Sheet FY3/22 FY3/23 FY3/22 （Millions of yen) End of Q2 End of Q2 Change Current assets 86,411 94,266 95,869 +1,602 ➢ Factors of increase/decrease Cash and deposits 56,617 64,283 64,492 +209 ●Cash and deposits Operating C/F 7,860 million yen Accounts receivable 13,152 11,944 10,977 △966 Inves
Slide 7: Overview of Financial Results for the Second Quarter
Briefing Contents ●Overview of Financial Results for the Second Quarter of the Fiscal Year Ending March 31, 2023 ©2022 WORKMAN CO.,LTD. All Rights Reserved 7
Slide 8: Store Openings
Store Openings ●We sought sustainable growth through new store openings tailored to customer needs General demand was incorporated by deploying stores in urban areas and at open malls, and the launch of the new category “WORKMAN Shoes” 961 stores at the end of September 2022 (up 17 stores over end-M
Slide 9: Monthly Trends and Factors
Monthly Trends and Factors ● Rise/Fall in Same-Store Sales, Number of Customers and Average Customer Spending （％） Rise/fall in sales Rise/fall in number of customers Average customer spending 40 34.5 Q1 overview Q2 overview As COVID-19-related restrictions were As there was demand to bring forward 3
Slide 10: Status of Sales (FY3/23 Q2)
Status of Sales (FY3/23 Q2) ● Sales at All Chain Stores 81,928 Million Yen ●Sales at existing stores All chain stores Existing stores by prefecture Net sales +11.1％ +5.2％ The second quarter saw moderate growth across Number of customers +9.7％ +4.2％ Japan, as the start of sales of autumn products was
Slide 11: Status of Sales (Results by Product)
Status of Sales (Results by Product) ●Sales of products for the athleisure market grew significantly with support from professional artisans ●Factors for Increase/Decrease in FY3/23 Q2 ●FY3/23 Q2 Sales by Product Sales at All Chain Stores （100 millions of yen） Athleisure Work Common (Hundreds of mil
Slide 12: Sales by Business Category
Sales by Business Category ● Contribution to sales at all chain stores (Monthly cumulative period) New stores maintained strong sales that contributed to the overall growth, with S&B and renovation/conversion also stimulating existing stores （％） WORKMAN New Format 52.9% Sales Composition Ratio (base
Slide 13: Status of Sales (Sales by Product and Factors)
Status of Sales (Sales by Product and Factors) ●Sales at All Chain Stores by Product （Millions of yen） FY3/22 Q2 FY3/23 Q2 Category Sales YoY Sales YoY Factors（YoY） Undergarments・Socks ・Summer supplies (+16.2％) Undergarments, socks, hats, towels, etc. 6,791 +8.8 7,821 +15.2 ・Outdoor caps (+33.1％) ・S
Slide 14: Sales of PB Products 50,950 Million Yen (Up 19.2% YoY)
Status of Sales (Sales by Product and Factors) ●Sales of PB Products 50,950 Million Yen (Up 19.2％ YoY) ●WORK ＆ Outdoor・Sports ●Changes in the PB ratio （The ratio to sales at all chain stores) Number of items （Millions of yen） (the previous year) Sales value (YoY) (％) Work & Outdoor 609（429） 19,717（+
Slide 15: Format of Store Operations
Format of Store Operations ●Ratio of Franchise Stores 96.4％ (up 0.7 points YoY) ●Format of Store Operations for FY3/23 Q2 ●Number of Stores by Format of Operations SC Training stores End- End- Outsourcing stores (Contract B) Franchise stores (Contract A) Number （％） Format March Up Down Sep. FC ratio
Slide 16: Inventories (Logistics Cost)
Inventories (Logistics Cost) ●Thorough and efficient inventory management helped improve inventory turnover days and the delivery cost ratio ●Selling price inventories per store ●DC inventories / delivery cost ratio ・As spring and summer products sold well, carried inventories fell ・Carried inventor
Slide 17: Plans for the Fiscal Year Ending March 2023
Briefing Contents ●Plans for the Fiscal Year Ending March 31, 2023 ©2022 WORKMAN CO.,LTD. All Rights Reserved 17
Slide 18: Plans for FY Ending March 31, 2023: Sustainable Growth Stories
Plans for FY Ending March 31, 2023 ●Management policy Store ●Open a wide array of stores in terms of locations, categories and sizes, and develop them in opening accordance with customer needs to enhance convenience. Sustainable Growth Stories ●Develop new functions and categories, including work re
Slide 19: Store Opening Plans: Go for 1,500 domestic stores
Store Opening Plans ●Go for 1,500 domestic stores Number Openings set for FY3/23 Renovation set for FY3/23※2 Number of Medium/ of stores stores at (Number of stores) S＆B※3 Closures longer-term at end of Full Partial end of Roadside SC※3 goals FY3/22 renovation renovation FY3/23 559 － － － (△11) (△67)
Slide 20: Store Opening Strategy
Store Opening Strategy ●General demand incorporated through stores combining #WORKMAN Girl and WORKMAN Shoes ●Purpose of opening stores Acquire potential customers Problems Strengths ・Susceptible to seasonal impacts ・Off-season demand drops ・Higher general demand for shoes ・The low ratio of male cus
Slide 21: Impacts of Sharp Rises in Purchase Prices
Impacts of Sharp Rises in Purchase Prices ●Realized “new standards for functions and prices” by keeping prices unchanged for PB products Plans to keep prices unchanged for all PB products for autumn/winter 2022 and major PB products for spring/summer 2023 ●Issues in product procurement ●Status as of
Slide 22: Product Development
Product Development ●Expand the customer base via new category development Broaden business domains as derivatives of the core business of work supplies through ambassador marketing ●WORKMAＮ’s target markets Work on expanding target markets Camp ・Enter the family-oriented camp gear market in Golf ea
Slide 23: Presentation of 2022 AW New Products
Presentation of 2022 AW New Products ●Hands-on event for mass media, influencers ●Enhance exposures to mass media (TV, newspapers, etc.) through SNS responses During four days after the presentation event, the Ambassadors/influencers Web media Newspapers, magazines, TV number of visits to the busine
Slide 24: Sales Strategy
Sales Strategy ●Support operations of FC stores by promoting customers’ store visits ●Strengthen linkages of products, release ●Effective use of BOPIS (Buy Online Pick-Up In Store) and sales floor ・EC sales ratio 1.5% (Q1 actual results, ratio to sales at all chain stores) Draft sales plan Of that,
Slide 25: Plans for the Fiscal Year Ending March 2023
Plans for the Fiscal Year Ending March 2023 ●The full-year profit forecast revised downward ・Royalty revenue and sales of products supplied increased thanks to the growth of sales of FC stores. Due to the worsening of the markup rate for PB products, gross profit margin declined 0.1 point. ・As the a
Slide 26: Disclaimer
■We have prepared this document solely for the purpose of facilitating understanding of WORKMAN, and not for the purpose of soliciting investment in the Company. As such, investors are advised to make investment decisions at their own discretion. ■ Whereas every effort has been made to ensure the ac