Slide 1: Additional Earnings Briefing Materials for 2Q of the Fiscal Year Ending December 2024
Additional Earnings Briefing Materials for 2Q of the Fiscal Year Ending December 2024 08/21/2024
Slide 2: Agenda
Agenda • Financial Result Highlights of 2Q FY 12/2024 • Progress in MTBP / Initiatives in 2H • FY 12/2024 Results Forecast © Earth Corporation All Rights Reserved. 1
Slide 3: Financial Result Highlights of 2Q FY 12/2024
Financial Result Highlights of 2Q FY 12/2024
Slide 4: Financial Result Highlights
Financial Result Highlights (Unit: 0.1 billion JPY) Increase in sales and income. Sales overperformance vs. the forecast coupled with ① COGS ratio and ② SG&A overperformance allowed the Earth Corporation to reach its income targets. Delays in the use of sales promotion expenses, leftover dispo
Slide 5: Management Accounting Basis: Sales / GPM (2023 vs. 2024)
Management Accounting Basis: Sales / GPM (2023 vs. 2024) (Unit: 0.1 billion JPY) Domestic - Insecticides & Repellents: Sales mostly in line w/ the forecast while profit margin exceeded expectations. Domestic - Household products: Sales of bath salts & oral hygiene products didn’t meet the foreca
Slide 6: Operating Income Change Factors (Vs. Forecast)
Operating Income Change Factors (Vs. Forecast) As of 2Q, we have been able to offset the negative impact of soaring raw material prices through the execution of price revisions. We met our sales target, leading to an increase in gross profit. SG&A was also lower than expected and some of these e
Slide 7: Consolidated: Balance Sheet
Consolidated: Balance Sheet (Unit: 0.1 billion JPY) ① Inventories (-4.3 B JPY): Benefits from inventory optimization starting in 2H LFY. ② Borrowings (-3.7 B JPY): Inventory optimization led to lower cash requirements. 2023.2Q 2024.2Q Change Total assets 1,499.2 1,548.7 ＋49.4 Cash & deposits 187.2 2
Slide 8: Progress in MTBP / Initiatives in 2H
Progress in MTBP / Initiatives in 2H
Slide 9: Medium-to-long-term Concept and Next MTBP
Earth Group’s Medium-to-long-term Our Group Working Together Toward a Bright Tomorrow for EARTH Concept Next MTBP Transform the earnings structure & build a framework Drive sales: Overseas Drive revenue: Domestic Expand Profit Generate Cost Foundation in Enhance global expansion Synergies Grow Culti
Slide 10: Progress in Earnings Structure Transformation
Progress in Earnings Structure Transformation Steady progress in the execution of reform initiatives to the earnings structure. While some efforts are already starting to bear fruit, we expect the bulk of the benefits to materialize in FY 12/2025 and beyond. Initiatives Progress & Future initiat
Slide 11: Offensive & Defensive Structural Transformation: Future Initiatives
Offensive & Defensive Structural Transformation ～Future Initiatives～ Two-pronged structural transformation combining Offense = future growth and Defense = improve operational efficiency. Discussions toward Group restructuring are proceeding as planned. We expect to share further details in 3Q. O
Slide 12: Goal of Structural Transformation
Goal of Structural Transformation The Earth Group will work to expand its market share, enhance our brands to achieve profitability improvements, and accelerate growth through overseas expansion – with the goal of further enhancing our value and competitiveness. Domestic Overseas Model: Model: Enh
Slide 13: Portfolio Targets
Portfolio Targets Our current portfolio is overly dependent on insecticides & repellents in Japan. Going forward, we seek to grow revenue/profits through a portfolio grounded on the 4 pillars of: domestic and overseas operations, the General Environment and Sanitation business, and MA-T-related.
Slide 14: Initiatives in 2H: Bringing a New Product to Market
Initiatives in 2H ｜Bringing a New Product to Market (Insecticides & Repellents) Speedy release of new product to combat the ongoing “super” bed bug epidemic. Earth will be releasing a new product this fall to capture rising demand for insecticides & repellents in the fall/winter season. We will
Slide 15: Initiatives in 2H: Recovery in the Household Product Category
Initiatives in 2H｜Recovery in the Household Product Category Raise the sales & profit baseline by releasing new & thematic products outside the scope of the planned release schedule for FY 12/2024. Dedicate more marketing resources to this category, including through the execution of new communi
Slide 16: Initiatives in 2H: Additional Cost Pass-Throughs
Initiatives in 2H｜ Additional Cost Pass-Throughs Price revisions to our product lineup of Sukki-ri! brand air fresheners (total of 53 SKUs), with the objective of improving profitability. Enhance sales efforts through, for example, the use of TV commercials to underscore these products’ value pr
Slide 17: FY 12/2024 Results Forecast
CXLN (w22 Earth Corporation EARTH Act For Life FY 12/2024 Results Forecast
Slide 18: Progress Vs. OI Target (Quarterly/Cumulative)
Progress Vs. OI Target (Quarterly/Cumulative) We do expect an overperformance for 2H, as well, but we face challenges from: ① weather-related risk factors, ② higher COGS than expected, ③ recording of expenses not used in 1H. Additionally, we will also consider the strategic deployment of ④ sales p
Slide 19: 2024 Results Forecast
2024 Results Forecast While we are hopeful for a year-end results overperformance, the forecast targets disclosed 02/13/2024 remain unchanged. Earth Corp. is evaluating various factors/risk scenarios and will aim for transparent disclosure. (Unit: 0.1 billion JPY) 2024 Forecast Topics 2023 Reali
Slide 20: Shareholder Returns
Shareholder Returns Shareholder Returns Policy: Stable dividend distribution with a DOE target of around 4%. Consider an agile approach to dividend raises and share buybacks. 2024 dividend target: 120 JPY/share (incl. a 2 JPY/share commemorative dividend). Completed share buyback: 2.0 B JPY; 4
Slide 21: Forward-looking statements notice
This presentation contains forward-looking statements and financial results forecasts. These forward-looking statements and financial results forecasts were formulated on the basis of company assumptions based on the information available. These statements and forecasts are subject to risks and unce