Autobacs Seven Co., Ltd. · TSE:9832

Autobacs Seven — H1 FY March 2018 Earnings Presentation

47 slides from Autobacs Seven's earnings presentation, Nov 1, 2017

  1. Slide 1: Analyst Meeting: Results of the Six Months ended September 30, 2017

    Translation Analyst Meeting Results of the Six Months ended September 30, 2017 November 1, 2017 AUTOBACS SEVEN CO., LTD.

  2. Slide 2: Results of the Six Months and Forecasts for Second Half of FY March 2018

    Results of the Six Months ended September 30, 2017 and Forecasts for Second Half of FY March 2018 Director, Senior Managing Executive Officer, Head of Corporate Administration Isao Hirata

  3. Slide 3: First Half of FY March 2018 Consolidated P/L

    First Half of FY March 2018 Consolidated P/L (Billion Yen) Six months ended September 30, 2017 Six months ended Actual YoY change Change from September 30, Initial Forecast results ratio forecast 2016 Net sales 95.4 98.1 +3.5% +2.7 94.8 Gross margin 31.3 31.6 +3.4% +0.3 30.6 Gross margin ratio 32.8%

  4. Slide 4: Major Index of First Half of FY March 2018

    Major Index of First Half of FY March 2018 Consolidated Sales YoY +3.5% （vs. initial forecast +2.8%） Gross Margin H1 FY 2018 H1 FY 2017 32.3% ← 32.3% （vs. initial forecast -0.5 point） SG&A YoY 160Million Yen Increased (vs. initial forecast 460 Million Yen ） Operating Income Result Estimate 1.86Billi

  5. Slide 5: Points for the first half of the fiscal year ending March 31, 2018

    Points for the first half of the fiscal year ending March 31, 2018  Increase in demand for automotive goods and services due to an increase in the number of new cars registered and rush demand for tires in which the price increased  Brisk sales of stores due to measures for the reduction of the wh

  6. Slide 6: Sales and profits of Reporting Segments

    Sales and profits of Reporting Segments Sales Profit (Million Yen) (Million Yen) 90,000 83,463 82,145 8,000 80,000 5,701 6,111 6,000 70,000 4,000 60,000 H1 March 50,000 2,000 2017 24 39 40,000 0 H1 March 30,000 -309 -748 -2,000 -293 -320 2018 20,000 14,593 4,59510,840 -3,221 10,000 -4,000 3,987 886

  7. Slide 7: Retail Sales in Total AUTOBACS Group Stores

    Retail Sales in Total AUTOBACS Group Stores Retail Sales Including FCs: 118.7 billion yen (+0.3% YoY) (Billion Yen) 140 118.4 118.7 Second hand goods & Fuel: 2.2BY (+6.9% YoY） 120 2.1 2.2 8.6 9.4 Statutory safety inspection: 9.4BY (+9.3% YoY) 100 12.8 12.1 Number of cars inspected： 317,000cars (+7.3

  8. Slide 8: Sales Variance by Merchandise (H1 FY2018)

    Sales Variance by Merchandise (H1 FY2018) 【Same store basis】 Sales: +1.2% YoY, Number of customers: -1.4% YoY Sales* changes by merchandise category (Million Yen） (YoY change in amount; total store basis) 1,500 1,133 1,000 Car Electronics 435 423 500 136 76 66 56 0 -3 -26 -179 -244 -500 Goods Motor

  9. Slide 9: Non-Consolidated and Domestic Store Subsidiaries

    Non-Consolidated and Domestic Store Subsidiaries (Million Yen) Non-consolidated Domestic Store Subsidiaries Results YoY Vs. Plans Results YoY Vs. Plans Net Sales 72,219 +1,351 +1,319 26,816 -4,447 -383 Gross 15,200 +829 +400 11,514 -671 +314 Margin(%) (21.0%) (+0.7pt) SG&A 13,396 +704 -403 11,435 -1

  10. Slide 10: Performance by Overseas Subsidiaries

    Performance by Overseas Subsidiaries FRANCE THAILAND SINGAPORE CHINA MALAYSIA Number of stores at Sep. 30, 2017 11 7 3 0 4 -including FC stores- H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 Period FY2018 FY2017 FY2018 FY2017 FY2018 FY2017 FY2018 FY2017 FY2018 FY2017 Net sales (Million Yen) 350 311 17 11 69 60 18 1

  11. Slide 11: CAPEX and Depreciation

    CAPEX and Depreciation CAPEX Depreciation (Billion Yen) (Billion Yen) 7 6 6.25 6.12 5.89 4.92 6 5 4.57 4.42 4.81 4.84 4.16 5 4 3.84 4 4.50 3.15 3 3 2 2 2.13 1.98 1 1 （H1） （H1） 0 0 2013/3 2014/3 2015/3 2016/3 2017/3 2018/3 2013/3 2014/3 2015/3 2016/3 2017/3 2018/3 （E） （E） 11

  12. Slide 12: Cash Flow

    Cash Flow Consolidated Cash Flow (Million Yen) (First Half FY2018) 15,000 10,628 10,000 Cash and cash equivalents: 36.9Billion Yen 5,000 (Sep. 30, 2017) 34.0Billion Yen 0 (Sep. 30, 2016) -2,929 -2,182 -5,000 Operating CF Investment CF Financial CF Breakdown of investment items (including items other

  13. Slide 13: Shareholders Return

    Shareholders Return Dividends per share Dividends and share buyback (Yen) (Billion Yen) Amount of share buyback 80 1st Half 2nd Half 12 Dividend paid 70 10 60 8 5.25 50 30 30 30 2.71 40 6 0.00 30 4 20 30 30 30 2 5.04 4.95 4.95 10 0 0 FY March 2016 FY March 2017 FY March 2018 FY March 2016 FY March 2

  14. Slide 14: Estimates of FY March 2018

    Estimates of FY March 2018 Full year forecasts of FY 2018 are unchanged, however operating income of first half was higher than initial (Billion Yen) H1 H2 Full Year Results Forecasts YoY Forecasts YoY Consolidated Sales 98.1 106.8 －2.1% 205.0 +0.5% COGS 31.6 35.0 －1.4% 66.7 +0.8% % 32.3% 32.7% +0.2

  15. Slide 15: Assumptions for the business environment for the second half

    Assumptions for the business environment for the second half Business environment [Positive factors] - Increased demand for studless winter tires and automotive goods and services due to strong sales of new vehicles - Attention to tires (price increase) and event data recorders (accidents, etc.), am

  16. Slide 16: Progress of Med-term Business Plan and Initiatives for the Second Half FY2018

    Progress of Med-term Business Plan and Initiatives for the Second Half FY2018 CEO, President Kiomi Kobayashi

  17. Slide 17: Review of the six months after the start of the 2017 Medium-Term Business Plan

    Review of the six months after the start of the 2017 Medium-Term Business Plan Turnaround of AUTOBACS business  Rapid start of development of new merchandise and store formats  Trend of store revenue improvement  Improvement of gross margin in the purchase phase, which is on the way Development o

  18. Slide 18: Domestic AUTOBACS Business: Creation of New Markets (Merchandise)

    Domestic AUTOBACS Business: Creation of New Markets (Merchandise) Merchandise for safety and security To enjoy life with vehicles Mercha ndise for lifestyle proposi To tion encoura ge love and fun for and with vehicles 18

  19. Slide 19: Domestic AUTOBACS Business: Creation of New Markets (Human Resources/Business Model)

    Domestic AUTOBACS Business: Creation of New Markets (Human Resources/Business Model) Human resources To differentiate AUTOBACS with new merchandise and human resources Store Formats 19

  20. Slide 20: To Increase the Appeal of Stores

    To Increase the Appeal of Stores Vision of AUTOBACS Chain Stores Achieve continuous development of the AUTOBACS chain by being a “professional” and “friendly” presence that continues to connect with customers 20

  21. Slide 21: AQ. (AUTOBACS QUALITY.) Enhancement of Merchandise in Existing Categories

    [Merchandise] Enhancement of Merchandise in Existing Categories AQ.（AUTOBACS QUALITY.） Cushion with an Dust cloths made of Waterproof bucket Foldable bucket adhesive disc that can microfiber be attached to a window Cloths made of microfiber: modern Coasters made from Disposable cotton cloths Smartph

  22. Slide 22: Development of Merchandise for Safety and Security

    [Merchandise] Development of Merchandise for Safety and Security Pedal Watcher  The aggregate number of units sold reached 3,900 units.  A portion of the sales proceeds was donated to the Foundation for Orphans from Automobile Accidents. Examples of other merchandise to support safe driving  Even

  23. Slide 23: Statutory Safety Inspections, Maintenance Services and Automobile Purchases and Sales

    [Merchandise] Statutory Safety Inspections and Maintenance Services /Automobile Purchases and Sales Statutory safety inspections and maintenance services  For compliance with laws and improved efficiency, introduction of the 15-minute acceptance inspection ⇒ Of 400 stores, 250 stores introduced it.

  24. Slide 24: To Enjoy Life with Vehicles

    [Merchandise] To Enjoy Life with Vehicles Garage Life Camper Car Wash Drawn Ｇlafit Motorcycle The goods which make a car fan excited 24

  25. Slide 25: Development of Lifestyle Merchandise

    [Merchandise] Development of Lifestyle Merchandise JACK＆MARIE  Opening in ZOZOTOWN in June 2017  Sales have been strong.  The opening of a physical store is planned for the current term. JKM／GORDON MILLER  Start of release from July 2017  Gradual introduction into stores  Items are being incre

  26. Slide 26: State of Actions for JACK&MARIE

    [Merchandise] State of Actions for JACK&MARIE Concurrently with the opening of the store in ZOZOTOWN, to increase recognition, limited-time openings of stores for various events May, GREENROOM FESTIVAL ‘17 2017 : Yokohama red Brick Warehouse July, OCEAN PEOPLE ‘17 2017 ：Yoyogi Park August, AOSHIMA B

  27. Slide 27: Development of Professional Human Resources, Actions for Publicity

    [Human resources] Development of Professional Human Resources, Actions for Publicity １．AUTOBACS GUYS  Selection of role models who embody the ideal of “professional & friendly” to lead the image of the Group  Appointment of a model for “good mechanics” who will appear on television commercials, th

  28. Slide 28: Store Formats: AUTOBACS GARAGE FUCHU

    [Store Formats] AUTOBACS GARAGE FUCHU Opened on June 2017 （fuchu-city, Tokyo） 28

  29. Slide 29: Store Formats: Smart+1 / AUTOBACS Mini

    [Store Formats] Smart+1 / AUTOBACS Mini Opened on February 2017 （Ibaraki-city, Osaka） Opened on August 2017 （Hino-city, Tokyo / Takamatsu-city Kagawa） Reservation-only AUTOBACS （YuriHonjo-city/ Iwakuni-city,Yamaguchi) AUTOBACS stores paired with gas stations （Tatebayashi-city,Gunma） 29

  30. Slide 30: Overseas Business

    Overseas Business ASEAN region: In addition to retail stores, the range of business models is expanding with wholesale and service offerings with partner companies. France: Unique positioning secured against competitors. Focus on safety inspections and sales of tires and parts. More efficient store

  31. Slide 31: Overseas Business: Actions in the ASEAN Region

    Overseas Business: Actions in the ASEAN Region Thailand - Store opening in GS in alliance with the PTG group Singapore - Opening of a store in the local gas station - Maintenance contract service Malaysia - Capital/business alliance with the Kit Loong group China - Supply of merchandise from Car Hou

  32. Slide 32: Used Car Buying, Car Dealer and BtoB Business

    Used Car Buying , Car Dealer and BtoB Business Store dedicated to automobile purchase services  Increased sales by existing stores dedicated to purchase services  Continual openings of new stores AUTOBACS CARS AUTOBACSCARS Imported car dealer Urawamisono store （opened on July, 2017） Fukuoka Airpor

  33. Slide 33: Actions for the second half of 2017 (business in the near future)

    Actions for the second half of 2017 (business in the near future) Aim to increase sales of existing stores by meeting market needs  Strong sales of new vehicles, cycle of tire replacement ⇒ Strengthening of tire sales (increase price competitiveness of PB tire)  Priority on low prices ⇒ Offering o

  34. Slide 34: Actions for the second half of 2017 (Medium-Term Business Plan measures)

    Actions for the second half of 2017 (measures according to the Medium-Term Business Plan) Start of store renovations Renovation of store floors to increase the attractiveness of the existing stores  Increase convenience for customers by reviewing zoning ⇒ Allocation of personnel in an efficient man

  35. Slide 35: Major Actions for CSR

    Major Actions for CSR Assistance in recovery from disaster due to the heavy rain in the northern part of the Kyushu region  Assistance with the costs of transporting the vehicles used for car sharing  Support for the stores in the neighborhood of the stricken area(provision of relief supplies, ins

  36. Slide 36: Create New Market and Gain Customer Trust

    Create New Market and Gain Customer Trust Merchandise for safety and security To enjoy life with vehicles Merchandise for lifestyle proposition To encourage love and fun for and with vehicles Human resources Store Formats 36

  37. Slide 37: Appendix

    Appendix

  38. Slide 38: Sales Trend: Retail & Wholesale

    Sales Trend: Retail & Wholesale 【YoY change for the last 12 months】 40.0% 35.5% Strong tire sales due to a last-minute surge in demand Sales Wholesale ahead of price hikes 30.0% Expansion in demand for winter products after mild winter the previous year 20.0% Increase in store deliveries of tires in

  39. Slide 39: Automobile purchase and sales (1)

    Automobile purchase and sales (1) Commercial flow of car purchase and B2B sales (No. of cars denotes cumulative units for the six months ended Sep. 30, 2017) FC Headquarters Sales by auction Appraisal and purchase consigned to FC Headquarters Used car dealers 1,360 cars Auto auctions 7,916 cars Cust

  40. Slide 40: Automobile purchase and sales (2)

    Automobile purchase and sales (2) Commercial flow of retail sales (No. of cars denotes cumulative units for the six months ended Sep. 30, 2017) New car dealers Used car dealers New car dealers Auto auctions Auto auctions Procurement Procurement FC Headquarters Customers Purchase & Wholesale Inventor

  41. Slide 41: Domestic New Store Openings (First Half FY2018)

    Domestic New Store Openings (First Half FY2018) Location Owner of Store Name Open Date (Prefecture) store Autobacs 1 AUTOBACS CARS Urawamisono Store Saitama July 31, 2017 Seven AUTOBACS Mini AEON Mall Tamadaira no Autobacs 2 Tokyo August 3, 2017 Mori Store Seven Autobacs 3 AUTOBACS Mini AEON Mall Ta

  42. Slide 42: Quarterly Income Statement

    Quarterly Income Statement (Million Yen) First Quarter Second Quarter First Half FY March 2018 FY March 2018 FY March 2018 Results YoY Results YoY Results YoY Sales 49,982 +5.1% 48,123 +1.8% 98,105 +3.5% Gross Margin 15,332 +3.2% 16,361 +3.6% 31,693 +3.4% % to the Sales 30.7% － 34.0% － 32.3% － SG&A

  43. Slide 43: Balance Sheets / Assets

    Balance Sheets / Assets Total Assets Total Assets 176.7 Billion 186.5 Billion Yen Yen Main factors Cash and 37 31.5 deposit Notes and accounts Increase due to holiday of banks 20.0 receivable 27.9 15.3 Inventory 16.3 Other accounts 20.8 receivable 16.7 Other 14.4 current assets 13.6 Property, plant,

  44. Slide 44: Balance Sheets / Liabilities and Net assets

    Balance Sheets / Liabilities and Net assets Liabilities and Liabilities and net assets net assets 176.7 186.5 billion Yen billion Yen Notes and accounts payable Short-term loans 12.8 payable 26.0 Accounts payable - 5.9 other 5.6 11.4 Other current 9.0 6.9 liabilities 6.7 0.9 0.6 Main factors 11.3 Lo

  45. Slide 45: Store Openings and Closings (Plan)

    Store Openings and Closings (Plan) Domestic stores Fiscal year ending March 31, 2018 No. of No. of H1 (results) No. of H2 (Plan) stores as of stores as of stores as of March 31, March 31, New S/B・R/L Close Sep. 30, New S/B・R/L Close 2018 2017 2017 (Plan) AUTOBACS 495 +2 －2 495 +4 499 Super AUTOBACS

  46. Slide 46: Performance Results of Franchisees

    Performance Results of Franchisees Ordinary Income of Franchise Companies (Preliminary) (Billion Yen) 4.0 3.81 2.0 1.63 0.18 0.0 -0.3 -2.0 -2.72 -2.5 -2.74 -3.13 -4.0 -6.0 -5.89 FY March 2014 FY March 2015 FY March 2016 FY March 2017 FY March 2018 Total of profit-making FCs Total of profit-making su

  47. Slide 47: Forward-Looking Statements

    Forward-Looking Statements These materials include forecasts regarding the Company’s future plans, strategies, and performance. This information is based on judgments and estimates made in accordance with information currently available. Actual results may differ materially from forecasts due to suc

Autobacs Seven — H1 FY March 2018 Earnings Presentation on 6ix