Kosaido Holdings Co.ltd. · TSE:7868
Kosaido Holdings Co.ltd — Q2 FY03/24 Earnings Presentation
45 slides from Kosaido Holdings Co.ltd's earnings presentation, Nov 10, 2023
Slide 1: Q2 Financial Results Presentation
FY03/24 Q2 Financial Results Presentation Securities code: 7868 November 10, 2023
Slide 2: Contents
0 Contents 1 Q2 FY03/24 Highlights P.2 - Q2 FY03/24 Consolidated Financial Results - Q2 FY03/24 Financial Results Summary by Business Segment - New Funeral Hall Capacity Utilization - Status of New Businesses 2 Consolidated Financial Forecast for FY03/24 P.7 - Revisions to Consolidated Financial For
Slide 3: Q2 FY03/24 Highlights
Q2 FY03/24 1 Highlights 2
Slide 4: Q2 FY03/24 Consolidated Financial Results
1-01 Q2 FY03/24 Consolidated Financial Results • As in Q1, income in the Information Segment decreased due to changes in COVID-19-related special demand from the previous fiscal year and large BPO projects that were shifted to Q4. However, profits were booked by curbing outsourcing costs and reducin
Slide 5: Q2 FY03/24 Financial Results Summary by Business Segment
1-02 Q2 FY03/24 Financial Results Summary by Business Segment (Millions of yen) Net sales YoY change Q2 Compared to forecast Operating profit YoY change Q2 Compared to forecast Q2 Q2 Rate of FY03/24 Rate of Q2 Q2 Rate of FY03/24 Rate of FY03/24 FY03/23 Change Change Forecast Change Change FY03/24 FY
Slide 6: New Funeral Hall Capacity Utilization
1-03 New Funeral Hall Capacity Utilization Capacity Utilization rate of Capacity Utilization rate existing and new Funeral halls of our Funeral halls Capacity utilization for new funeral halls is on an upward trend Sep Week 3 Sep Week 4 Sep Week 5 Oct Week 1 Oct Week 2 Oct Week 3 Oct Week 4 Oct Week
Slide 7: Status of New Businesses
1-04 Status of New Businesses Funeral Business * … 2 companies: Kosaido Lifewell, Gran Ceremo Tokyo - FY03/24 Performance (2 companies* combined) (Millions of yen) Q1 Q2 Q2 (Cumulative) Diff. from Diff. from Diff. from Diff. from Diff. from Diff. from Actual Plan plan Prior year prior year Actual Pl
Slide 8: Consolidated Financial Forecast for FY03/24
Consolidated Financial Forecast 2 for FY03/24 7
Slide 9: Revisions to Consolidated Financial Forecast for FY03/24
2-01 Revisions to Consolidated Financial Forecast for FY03/24 (Millions of yen) Q1 Q2 H1 (cumulative) Compared Amount Amount YoY YoY to initial YoY Revised revised Revised revised Revised forecast Prior FY Prior FY Actual forecast Prior FY Actual forecast Rate of results Rate of Actual forecast Rate
Slide 10: Consolidated Financial Forecast for FY03/24 | Quarterly by Segment
2-02 Consolidated Financial Forecast for FY03/24 ｜Quarterly by Segment 1Q 2Q H1 (cumulative) (Millions of yen) Revised Compared to initial Compared to initial Revised Compared to initial YoY Revised YoY YoY forecast Prior FY forecast Prior FY forecast Prior FY Actual forecast results Actual forecast
Slide 11: FY03/24 Shareholder Return
FY03/24 Shareholder 3 Return 10
Slide 12: Shareholder Return
3-01 Shareholder Return Approach to shareholder return and internal reserves Dividend ・・・ Dividends implemented as a stable return policy ⇒ Current dividend payout ratio 30% 32.5% Dividend and [As of November 10, 2023] internal reserves Further increase in the dividend payout ratio will be considere
Slide 13: Stock Split
3-02 Stock Split Stock split (announced Nov 10, 2023) At a meeting of the Company's Board of Directors held on November 10, 2023, the following resolution was adopted. Purpose of the stock split: In line with the new NISA system that will be introduced from January next year, the Company decided to
Slide 14: Revision to Dividend Forecast
3-03 Revision to Dividend Forecast Dividend Forecast for FY03/24 ✓ In addition to reflecting revisions in the full-year consolidated financial forecast, the payout ratio will change from 30% to 32.5% Dividend per share Record date End of Q2 End of FY Total FY03/23 results 7.75 yen 13.50 yen 21.25 ye
Slide 15: Long-Term Outlook
４ Long-Term Outlook 14
Slide 16: State of the Population | Estimated Deaths
4-01 State of the Population | Estimated Deaths Nationwide Tokyo Unit: 10,000 ppl Unit: 10,000 ppl 200 50 Nationwide Actual Estimated 180 45 Tokyo 160 166 165 160 156 156 40 152 141 143 140 35 130 123 119 120 113 30 108 100 97 25 93 82 20 20 80 74 19 20 71 72 71 72 17 16 16 16 15 60 14 15 12 11 10 9
Slide 17: Room for Expansion at Tokyo Hakuzen | Social Responsibility
4-02 Room for Expansion at Tokyo Hakuzen | Social Responsibility As a company that provides cremation services in the public interest, we will fulfill our social responsibility in response to the increase in deaths. *Company estimates based on statistical data from the Office of the Governor for Pol
Slide 18: Room for Growth through Expansion | Profit Estimates
4-03 Room for Growth through Expansion｜Profit Estimates Estimated impact on performance by utilizing room for expansion - Facility-related data Current facilities Funeral Number of funeral homes 6 locations (23 wards) halls Revenue per tsubo | 2,232,000 yen/year Total floor area 45,132 ㎡ Furna- Tota
Slide 19: The Tokyo End-of-Life Market
4-04 The Tokyo End-of-Life Market Tokyo funeral services High number of deaths Expensive land - Long wait times for funerals - Difficult to build new crematoriums Tokyo residents are waiting Future crematorium shortage for cremations Our efforts to date - Significantly added funeral halls - Eliminat
Slide 20: Business Growth Beyond Medium-Term Business Plan 3.0
4-05 Business Growth Beyond Medium-Term Business Plan 3.0 Major funeral (Billions of yen) Consolidated Operating Profit Growth services subsidiary expansion Medium-Term Business Plan 3.0 Future expansion 2.5 Impact from additional - Spread crematorium funeral halls business nationwide Existing Mediu
Slide 21: Appendix
Appendix 1. Details of FY03/24 Performance A 2. Medium-Term Business Plan Performance Targets 3. ESG Activities Report 4. Company Introduction 20
Slide 22: A1-01 Quarterly Trend (Net Sales)
A1-01 Quarterly Trend (Net Sales) • Q2 sales increased in the Funeral Services segments due to the operation of new funeral halls at Tokyo Hakuzen and increased orders from two funeral service companies. In the Information and HR segments, overall sales decreased 6.6% year on year due to a difficult
Slide 23: A1-02 Quarterly Trend (Cost of Sales)
A1-02 Quarterly Trend (Cost of Sales) • Q2 cost of sales decreased year on year (-633 million yen, -3.0 pt cost of sales ratio) • Continued control of subcontract expenses and reduction of fixed costs in the Information Segment contributed to cost cuts. (Millions of yen / %: Cost of sales ratio) 8,0
Slide 24: A1-03 Quarterly Trend (SG&A Expenses)
A1-03 Quarterly Trend (SG&A Expenses) • Q2 SG&A expenses decreased year on year (-276 million yen, -1.7 pt SG&A expenses ratio) • Continued reduction of fixed costs by implementing cost optimization at operating company. (Millions of yen / %: SG&A expense ratio) 2,500 2,086 2,097 2,005 (21.6%) （25.6
Slide 25: A1-04 Quarterly Trend (Number of Employees)
A1-04 Quarterly Trend (Number of Employees) • Review personnel in Information and HR segments and promote business optimization (Number of employees / %: Composition ratio) *Numbers inside parentheses indicate YoY change 1,200 1,127 1,129 1,116 1,101 1,117 1,077 (-50) 58 5.1% 65 5.7% 6.8% 62 5.5% 5.
Slide 26: A1-05 Quarterly Trend (Operating Profit by Segment)
The method for booking management guidance fees for Group companies Quarterly Trend has been changed effective from the first quarter of the current fiscal year. These fees, which were included in corporate expenses as an adjustment, are now booked as operating expenses for each Group company of the
Slide 27: A1-06 Q2 FY03/24 Analysis of Change in Operating Profit
A1-06 Q2 FY03/24 Analysis of Change in Operating Profit (Major Items) • Year on year, Information and HR segment income decreased, but Profit-Generating Funeral Services income increased. Overall income increased as a result of cost reductions in both Information and HR segments. (Millions of yen) +
Slide 28: A1-07 Consolidated Balance Sheet
A1-07 Consolidated Balance Sheet (Millions of yen) Difference as of March 2023 Sep 2023 quarter end Current assets 27,998 27,127 -871 Cash and deposits 18,699 13,133 -5,566 Notes and accounts receivable–trade 5,810 3,458 -2,352 Non-current assets 43,134 43,937 803 Property, plant and equipment 35,80
Slide 29: A1-08 Public Funeral Services Income & Expenditures
Public Funeral Services Business A1-08 Income & Expenditures | Q2 FY03/24 The Public Funeral Services Business is a business that has a significant amount of public interest and requires permanence and non-profitability. Increase in transparency Increase in business stability ■The Company’s responsi
Slide 30: A2-01 Medium-Term Business Plan 3.0 Performance Targets
A2-01 Medium-Term Business Plan 3.0 Performance Targets Medium-Term Business Plan 3.0 (announced May 12, 2023) (Millions of yen) Medium-Term Business Plan 3.0 FY03/22 FY03/23 FY03/24 Results Results Forecast FY03/25 FY03/26 Plan Plan May 12 Nov 10 Net sales 35,361 36,668 40,000 39,841 42,100 43,800
Slide 31: A2-02 Performance Targets by Business Segment
Medium-Term Business Plan 3.0 Performance Targets A2-02 by Business Segment (Millions of yen) Medium-Term Business Plan 3.0 (announced May 12, 2023) Medium-Term Business Plan 3.0 FY03/23 FY03/24 Results Forecast FY03/25 FY03/26 PLAN PLAN May 12 Nov 10 Public Funeral Net sales 5,561 6,033 5,808 6,215
Slide 32: A3-01 ESG Activities Report
A3-01 ESG Activities Report The purpose of the Kosaido Holdings ESG Activity Report is to provide shareholders, investors, business partners, and a wide range of other stakeholders with an understanding of the Company’s approach and concrete action to further sustainability. The Kosaido Group SDGs D
Slide 33: A3-02 Social Responsibility of the Cremation Business
ESG Activity Report [Society] A3-02 - Social Responsibility of the Cremation Business Basic Concept Machiya Funeral Hall Yotsugi Funeral Hall Ochiai Funeral Hall The Company conducts our business based on the spirit of Horinouchi Funeral Hall “Kosai,” which means “contributing to society at large.”
Slide 34: A3-03 Social Responsibility of the Cremation Business
ESG Activity Report [Society] A3-03 - Social Responsibility of the Cremation Business Social Responsibility of the Cremation Business in a High-Death Society Both local communities and Japanese society as a whole are facing a high number of deaths, and that figure increases by the year. As shown in
Slide 35: A3-04 Social Responsibility of the Cremation Business
ESG Activity Report [Society] A3-04 - Social Responsibility of the Cremation Business *Excerpt/reprint from this document: Q1 FY03/24 Highlights) State of the Population | Estimated Deaths Nationwide Tokyo Unit: 10,000 ppl Unit: 10,000 ppl Nationwide Actual Estimated Tokyo Nationwide: Statistics Bur
Slide 36: A3-05 Tokyo Hakuzen's Actions
ESG Activity Report [Society] A3-05 - Social Responsibility of the Cremation Business Tokyo Hakuzen's Actions ■Cremation technology for smooth funeral services While many crematoriums use furnaces with carts, Tokyo Hakuzen uses grates that enable quick cremations so we can handle the increasing numb
Slide 37: A3-06 ESG Activity Report [Environment]
A3-06 ESG Activity Report [Environment] Disclosure Based on the Task Force on Climate-related Financial Disclosures (TCFD) Recommendations In addition to endorsing the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD), in 2022, in response to increasing greenhouse gas
Slide 38: A3-07 ESG Report [Environment]
A3-07 ESG Report [Environment] Participatory Employee Eco Program Launched (October 2023) In October 2023, we commenced the Participatory Employee Eco Program with the aim of raising awareness about environmental issues and encouraging participation in concrete action to decarbonize among every empl
Slide 39: A3-08 ESG Activity Report [Governance]
A3-08 ESG Activity Report [Governance] Basic Concept Aiming to maximize shareholder value, sustainably increase enterprise value, and earn society's trust, we not only boost profitability, but also emphasize shareholder rights, implement efficient, fair, and transparent management practices, and ens
Slide 40: A4-01 Company Overview
A4-01 Company Overview Company Establish- name KOSAIDO Holdings Co., Ltd. ment January 1949 36,668 71,064 39,452 Net sales million yen Total assets million yen Net assets million yen (FY03/23) (as of Sep 30, 2023) (as of Sep 30, 2023) Represent- ative Hiroshi Kurosawa, President & CEO Number of empl
Slide 41: A4-02 History
A4-02 History Kosaido Group 2021 Transitioned to a holding 1984 company structure Tokyohakuzen joined the Group (Started ending-related business) 1970 Founded Japan’s first 2022 computer typesetting company Launched Funeral Planning Services 2013 (Kosaido Lifewell, Gran Ceremo Tokyo) Established Vie
Slide 42: A4-03 Mission, Vision, and Value
A4-03 Mission, Vision, and Value MISSION Further enrich 100-year lives VISION A Company that creates myriad “thank yous” Provide innovative services overflowing with VALUE gratitude through individual challenges and strong organizational connections. Based on our management philosophy of “Kosai,” wh
Slide 43: A4-04 KOSAIDO Group
[Main businesses] A4-04 KOSAIDO Group Crematory operation and provision of funeral halls Ending-related Business Funeral planning services Ending-related business Further enrich 100-year lives. Information Solution Business [Main businesses] Offset printing (publishing, commercial) Newspaper printin
Slide 44: A4-05 KOSAIDO Group's SDGs Declaration
A4-05 KOSAIDO Group’s SDGs Declaration Economy Society Providing wide-ranging support Live in harmony with others Value creation for Developing equitable and diverse communities To put our corporate philosophy of sustainable economic activities In the coming era where people live for 100 years, “con
Slide 45: A4-06 Contact
A4-06 Contact If you have any comments or questions about this presentation or other IR-related topics, please use the inquiry form at the following URL to contact us. In addition, Facilities Tour for Institutional Investors and Analysts are held accordingly (funeral home tours operated by Tokyo Hak