Pola Orbis Holdings Inc. · TSE:4927
Pola Orbis — Q3 2017 Earnings Presentation
24 slides from Pola Orbis's earnings presentation, 2017
Slide 1: Third Quarter of Fiscal 2017 Supplementary Material
Third Quarter of Fiscal 2017 Supplementary Material POLA ORBIS HOLDINGS INC. Director and Vice President Management Planning, IT and Global Business Division Naoki Kume This report contains projections of performance and other projections based on information currently available and certain assumpti
Slide 2: Agenda
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2017 4. Initiatives Going Forward & Appendices 1
Slide 3: Q3 Key Topics
Q3 Key Topics Cosmetics Market Japanese cosmetics market overall showed steady growth. However, the pure domestic market, excluding inbound demand seemed to decline slightly.* By price range, high prestige remained steady. By channel, drugstore, department store and e-commerce channels grew. A
Slide 4: Analysis of Consolidated P&L Changes: Net Sales to Operating Income
Analysis of Consolidated P&L Changes Net Sales to Operating Income FY2016 FY2017 YoY Change (mil. yen) Q3 Results (YTD) Q3 Results (YTD) Amount % Consolidated net sales 159,150 177,846 18,695 11.7% Cost of sales 29,890 29,415 (475) (1.6%) Gross profit 129,260 148,430 19,170 14.8% SG&A* expenses 110,
Slide 5: Analysis of Consolidated P&L Changes: Operating Income to Profit Attributable to Owners of Parent
Analysis of Consolidated P&L Changes Operating Income to Profit Attributable to Owners of Parent FY2016 FY2017 YoY (mil. yen) Q3 Results (YTD) Q3 Results (YTD) Amount % Operating income 18,310 30,546 12,236 66.8% Non-operating income 342 332 (10) (3.0%) Non-operating expenses 1,202 88 (1,114) (92.7%
Slide 6: Factors Impacting Profit Attributable to Owners of Parent
Factors Impacting Profit Attributable to Owners of Parent Profit attributable to owners of parent was up 70.9% yoy due to increase in gross margin and improvement in profit structure Positive impact Negative impact (mil. yen) 36,000 Increase in sales at POLA brand Difference due to extraordinary 32,
Slide 7: Segment Analysis
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2017 4. Initiatives Going Forward & Appendices 6
Slide 8: Segment Results
Segment Results FY2016 FY2017 YoY (mil yen) Q3 Results (YTD) Q3 Results (YTD) Amount % Consolidated net sales 159,150 177,846 18,695 11.7% Beauty care 147,308 165,268 17,960 12.2% Real estate 2,285 2,020 (265) (11.6%) Others 9,556 10,557 1,001 10.5% Operating income 18,310 30,546 12,236 66.8% Beauty
Slide 9: Beauty Care Business Results by Brands
Beauty Care Business Results by Brands FY2016 FY2017 YoY (mil. yen) Q3 Results (YTD) Q3 Results (YTD) Amount % Beauty care net sales 147,308 165,268 17,960 12.2% POLA 83,543 104,902 21,358 25.6% ORBIS 41,982 39,888 (2,093) (5.0%) Jurlique 8,800 8,201 (599) (6.8%) H2O PLUS 1,891 1,765 (126) (6.7%) Br
Slide 10: Brand Analysis (1)
Brand Analysis (1) Q3 Result Topics Wrinkle Shot encouraged customer acquisition and Introduced new products in activation of existing customers. Both the number of the B.A series. customers and purchase price per customer grew. (Left) B.A prislumina (serum) Sales of esthetic products increase
Slide 11: Sales Progress of POLA Wrinkle Shot Serum
Sales Progress of POLA Wrinkle Shot Serum Sales progress above the revised target of ¥12.5bn, reinforcing customer base Jan–Sep YTD Sales: Approximately 800,000 units, ¥11.2 billion (+6% compared to the revised target / more than +30% compared to the initial target) Sales progress Customer base
Slide 12: Brand Analysis (2)
Brand Analysis (2) Q3 Result Topics The number of customers during the three months in Obtained the 1st place for three 3Q was maintained flat on a quarter-to-quarter basis consecutive years under mail-order by promoting skincare products. business “own-brand category” However, the slowdown tr
Slide 13: Brand Analysis (3)
Brand Analysis (3) Q3 Result Topics Sales dropped by 13% yoy (on AUD basis). Revamped the body care series, Hong Kong and duty-free businesses remained which serve as introduction harsh; however, sales started to recover in Australian products for brand entry market thanks to new product launc
Slide 14: Brand Analysis (4)
Brand Analysis (4) Q3 Result Topics Sales decreased due to delay in renewing a contract Launched new products with a distributor in Russia and slackness at existing for 2H. Won awards from retailers in North America. magazines Operating income improved in line with initial plan Oprah Beauty Aw
Slide 15: Brand Analysis (5) Brands Under Development
Brand Analysis (5) Brands Under Development Q3 Result Topics Overall sales decreased yoy due to sales of FL and THREE pdc brands last year. Like-for-like sales grew by - Entered into Singapore 23.9% excluding the two brands. in September At THREE, new customers increased driven by - Launched a
Slide 16: Forecasts for Fiscal 2017
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2017 4. Initiatives Going Forward & Appendices 15
Slide 17: Forecasts for FY2017 (Revised)
Forecasts for FY2017 (Revised) Consolidated Sales and OP income are revised upwardly by 8.0bn and 1.5bn respectively. The Group is expecting increases both in sales and income for the eighth consecutive year. YoY 2017 Full-year vs. July 31 YoY Q3 Results(YTD) (mil. yen) Amount % Forecast Forecast Am
Slide 18: Initiatives Going Forward & Appendices
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2017 4. Initiatives Going Forward & Appendices 17
Slide 19: Initiatives for 2017 Q4
Initiatives for 2017 Q4 Sustain stable growth of flagship brands to lead Group earnings Launch limited-time special boxes from the “B.A“ series, the most prestigious series from the brand. Carry out marketing campaigns in order to ensure sustainable growth next year and onwards. Aim at further P
Slide 20: Appendix: About POLA ORBIS Group
Appendix : About POLA ORBIS Group Beauty care is the core business of the Group, and 7 different cosmetic brands are operated under the Group umbrella FY2016 Consol. Net Sales ¥218.4 bil. Overseas Flagship Brands under Brands Brands development ¥20,000 High Prestige Price Range ¥10,000 Prestige ¥5,0
Slide 21: Appendix: Beauty Care Business Brand Portfolio
Appendix : Beauty Care Business Brand Portfolio Sales Brand Concept and products Price Sales channel ratio* Consignment sales through High-prestige skincare Approx. Beauty Directors： 57% Leading-edge technology in ¥10,000 POLA THE BEAUTY (PB), anti-aging and skin-whitening Esthe-inn and conven
Slide 22: Appendix: Beauty Care Business Results for FY2014–FY2016 by Brands
Appendix : Beauty Care Business Results for FY2014 – FY2016 by Brands FY2014 FY2015 FY2016 2015 vs 2016 YoY Change (mil. yen) Results Results Results Amount % Consolidated net sales 198,094 214,788 218,482 3,693 1.7% Beauty care net sales 184,475 200,570 202,446 1,875 0.9% POLA 99,571 109,352 116,12
Slide 23: Appendix: Long-term Vision
Appendix : Long-term Vision STAGE3 Become a highly profitable global enterprise Consolidated Net sales STAGE2 Goals for FY2020: •Consol. net sales: ¥250.0 bil. or higher (bil. yen) Further strengthen domestic •Overseas sales ratio: 20% or higher STAGE1 earnings structure and •Operating margin: 13-15
Slide 24: Appendix: 2017–2020 Medium-term Management Plan
Appendix : 2017 – 2020 Medium-term Management Plan The final stage of the long-term vision for 2020. Aim to improve profitability in Japan, promote a solid shift toward overall profitability from overseas operations and build a brand structure for next-generation growth. Consolidated net sales Capit