Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — Q3 FY2024 Earnings Presentation
41 slides from Komehyo's earnings presentation, Feb 13, 2024
Slide 1: Earnings Results Briefing for the Third Quarter of the Fiscal Year Ending March 31, 2024
Earnings Results Briefing for the Third Quarter of the Fiscal Year Ending March 31, 2024 February 13, 2023 Komehyo Holdings Co., Ltd. Securities code: 2780 (Tokyo Stock Exchange and Nagoya Stock Exchange)
Slide 2: From reuse to relay use
From reuse to relay use We will inherit that "value". Maintenance, remake, editing, connection with people. "Relay youth" is not just a downcycle of the value of things, but an upcycle of increasing the value, even though it is reused. As values for a sustainable future society spread, we will contr
Slide 3: Komehyo Holdings is necessary for a sustainable recycling society
Komehyo Holdings is necessary for a sustainable recycling society. It acts as a relay point in the connection of “people,” “things,” and “society.” We will strive to connect “good quality" and "value" to the future. We respect people for making products, thank people for providing products for use b
Slide 4: Competitive Advantages of the KOMEHYO Holdings Group
Competitive Advantages of the KOMEHYO Holdings Group Since its founding, the Group has consistently worked on reuse. Developing Business with Three Competitive Advantages. Talent retention Brand reuse rate of 1.7 No.1 * million 90 % or more items handled annually In order to acquire a wealth of prod
Slide 5: Contents
Contents 1. Cumulative results for the third quarter of the fiscal year P. 6 ending March 2024 2. Initiatives for the third quarter of the fiscal year ending P.24 March 2024 3. Future outlook P.35 5
Slide 6: 1. Cumulative results for the third quarter of the fiscal year ending March 2024
1. Cumulative results for the third quarter of the fiscal year P. 6 ending March 2024 2. Initiatives for the third quarter of the fiscal year ending P.24 March 2024 3. Future outlook P.35 6
Slide 7: FY 2024 3Q Financial Summary
FY 2024 3Q Financial Summary Brand・Fashion busines Tire and Wheel buisiness Purchase from individual customers Net sales Operating income Net sales Operating income 46,558 80,115 4,671 3,991 268 Millions of yen Millions of yen Millions of yen Millions of yen Millions of yen （YoY139.7％） （YoY104.8％） （
Slide 8: Brand fashion business 3Q progress
Brand fashion business 3Q progress Initial Plan 2Q 3Q ・Individual purchases: YoY 149.8％ ・Purchase (individual purchase ・Individual purchases: YoY 146.0% ・In October the impact of domestic gold retail prices exceeding 10,000 yen per gram + corporate purchase)：YoY ・Despite unstable diamond and watch m
Slide 9: Changes in average purchaser unit price by product
Changes in average purchaser unit price by product（Komehyo Co., Ltd.） Due to purchase price control in line with market price fluctuations for watches and bags from late November onward, unit purchase price per customer also followed a downward trend. We have strengthened the purchasing of high unit
Slide 10: FY 2024 3Q Performance
FY 2024 3Q Performance In the first nine months, record sales and profit at every leve FY2024 3Q vs full year (Millions of yen) FY2024 1Q YoY FY2024 2Q YoY FY2024 3Q YoY 9months YoY plan* Net sales 25,096 133.8% 27,667 135.2% 31,377 133.7% 84,141 134.2% 79.4% Gross profit 6,592 139.7% 6,698 131.5% 7
Slide 11: Operating profit increase and decrease factor
Operating profit increase and decrease factor Purchasing remained strong, and sales increased significantly for both retail and corporate sales. Due to sales growth, profit increased by absorbing the decline in gross profit margin and increase in SG&A expenses. (Millions of yen) Increase in personne
Slide 12: Changes in selling, general and administrative expenses
Changes in selling, general and administrative expenses Hiring and training was strengthened to secure the staff needed to open large stores annexed with sales facilities and purchase centers, resulting in higher personnel expenses. The SG&A to net sales ratio declined as we managed to control SG&A
Slide 13: Active investment in human resources
Active investment in human resources（FY2024 9months Komehyo Co., Ltd.） With an eye on domestic business growth and global expansion, we will proactively invest in our human resources, which is our strength.Aim to expand business scale while controlling overall personnel costs and increase share in t
Slide 14: Non-operating income(expenses) / Extraordinary income(losses)
Non-operating income(expenses) / Extraordinary income(losses) (Millions of yen) Non-operating expenses74 Interest expenses54 Extraordinary losses73 Rent expenses Impairment losses39 on store7 Loss on retirement of Other12 non-current assets33 Non-operating income112 Extraordinary Foreign exchange ga
Slide 15: Balance sheet overview
Balance sheet overview (Millions of yen) FY2023 FY2024 3Q Change Current assets 35,322 52,566 17,243 Cash and deposits 10,382 11,234 852 Inventories 18,705 30,061 11,355 →Due to strong individual purchasing and strengthening of corporate purchasing Other current assets 6,234 11,270 5,035 Inventories
Slide 16: Inventory Turnover (Brand・Fashion business)
Inventory Turnover（Brand・Fashion business） To address the drop in market prices for watches and bags, we have been converting high-risk inventory into cash on a priority basis while ensuring retail inventory. Abundant inventory is directly linked to future sales and profits, so inventory control mai
Slide 17: Reference: Trends during market fluctuations and our countermeasures
Reference: Trends during market fluctuations and our countermeasures price When market prices are declining, gross profit margins tend to decline. When market prices are rising, gross profit margin tends to rise ▼ ・Make purchase prices more balanced ▼ ・Strengthen corporate sales with emphasis on inv
Slide 18: Overview by segment
Overview by segment In the cumulative 3Q, the brand and fashion business saw an increase in sales and profits due to strong performance in personal purchases and retail sales.In the tire and wheel business, sales increased due to strong online sales of new tires. FY2024 (Millions of yen) FY2024 1Q Y
Slide 19: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) In part due to the ongoing opening of new purchase centers, the number of customers increased, and was up 150% YoY in the third quarter. The amount spend on purchases was a record high for a quarter. Purchase from individual customers (Group total) (M
Slide 20: Breakdown of consolidated Net sales
Breakdown of consolidated Net sales (Retail / Overseas/Domestic tax-free sales) [Retailing] Strengthening of retailing has increased the retail ratio, maintaining an ideal composition ratio (Retail: Corporate = 50:50). [Overseas] Overseas sales were strong due to store relocations and the opening of
Slide 21: Breakdown of domestic duty-free sales
Breakdown of domestic duty-free sales 【 Composition ratio by country/region 】40% of customers are Chinese, and there have been no major shifts in the trend of the top five countries accounting for just under 80% of all customers. During the peak inbound period in the fiscal year ended March 31, 2015
Slide 22: Quarterly Trends in Consolidated Net Sales and Gross Profit Margin
Quarterly Trends in Consolidated Net Sales and Gross Profit Margin [Net sales] Sales increased in both retail and corporate sales due to strong individual purchases and corporate purchases. [Gross profit margin] Gross profit margin declined for both retail and corporate sales due to falling market p
Slide 23: Shareholder return
Shareholder return The policy is to aim for a dividend payout ratio of 20%. Taking into consideration the profit forecast level for the fiscal year ending March 31, 2024, the annual dividend for the fiscal year ending March 31, 2024 was revised from the initial plan of 76 yen to 88 yen (an increase
Slide 24: 2. Initiatives for the third quarter of the fiscal year ending March 2024
1. Cumulative results for the third quarter of the fiscal year P. 6 ending March 2024 2. Initiatives for the third quarter of the fiscal year ending P.24 March 2024 3. Future outlook P.35 24
Slide 25: FY 2024 3Q Initiative Summary
FY 2024 3Q Initiative Summary 25
Slide 26: Stores: Group total 216 stores (As of December 2023)
Stores：Group total 216 stores（As of December 2023) *The figure in parentheses ( the third quarter. ) represents the increase during Brand fashion Tire and Wheel flagshipstore 6 (１） 3 1 Sales Stores 1 6 3 Stores annexed with sales facilities 18 3(1） 2 10 ( 1 ) 2 Purchasing Center 112 ( 9,-1 ) 6 Franc
Slide 27: Opening the purchase center
Opening the purchase center Store opening plan：The amount of purchase per store remained strong. The store openings added 3.9 billion yen.(1.5 billion yen during the fiscal year) to the annual purchase amount.Signboard effect from new store openings had a positive impact on existing stores. New stor
Slide 28: Product distribution (FY2024 9months)
Product distribution（FY2024 9months） Purchasing quality/market/distribution sale YoY YoY ▲4pt ＋1pt Purchase from individual customers 73％ KOMEHYO 41％ Retail Merchandise center Stores/Home delivery Purchasing/Purchasing at events/ Store Purchasing at visited sites WEB（Own EC site,EC mall,live commerc
Slide 29: E-commerce-induced sales rate
E-commerce-induced sales rate（Komehyo Co., Ltd.） In addition to an increase in the number of customers, the per-customer spending rose, resulting in e-commerce-induced sales of 134% YoY, a record high for the quarter. E-commerce-induced sales rate was at just under 40% due to rising sales ratio of v
Slide 30: Expanding customer base: Opening of KOMEHYO SHIBUYA
Expanding customer base Opening of “KOMEHYO SHIBUYA” KOMEHYO SHIBUYA, a large-scale sales store with purchase attached, will open on November 17, 2023. Strengthening of retail sales on the back of strong purchases. Targeting domestic and international fashion connoisseurs, mainly Generation Z and Y,
Slide 31: BRAND OFF Strengthen retail
BRAND OFF Strengthen retail Strong performance has continued at the existing BRAND OFF Ginza Main Store flagship and at overseas stores in Hong Kong and Taiwan. We have continued to enhance points of contact with new customers by renovating retail stores, opening new stores and making active improve
Slide 32: BRAND OFF FC purchase store opened
BRAND OFF FC purchase store opened ▶Continue opening franchise stores Planning to open 40 stores in FY03/24.Products purchased at specialized purchasing stores (FC) are sold through the most appropriate channels, mainly through the auction JBA, which we operate in-house.A mechanism that increases th
Slide 33: Corporate auction volume
Corporate auction volume JBA auctions, particularly offline auctions in Kanazawa, displayed strength due mainly to an increase in the number of registered members. The total trading volume of corporate auctions increased 120.1% year on year, hitting a record high. Number of registered menmbers Trade
Slide 34: Tire and Wheel
Tire and Wheel Sales increased due to strong online sales of summer and winter tires, as well as increased domestic sales of in-house designed wheels.Gross profit margin declined as the snowfall season was later than usual and winter products struggled. Profit decreased due to an increase in selling
Slide 35: 3. Future outlook
1. Cumulative results for the third quarter of the fiscal year P. 6 ending March 2024 2. Initiatives for the third quarter of the fiscal year ending P.24 March 2024 3. Future outlook P.35 35
Slide 36: Brand and Fashion business 4Q assumption
Brand and Fashion business 4Q assumption In light of predictions about market price trends for key goods, we expect that increased net sales will absorb the decline in gross profit margin, with operating income staying in line with forecasts. The forecasted market trend of mainstay products Forecast
Slide 37: Medium-term management target (Fiscal year ending March 2024 to March 2026)
Medium-term management target (Fiscal year ending March 2024 to March 2026) Operating income, ordinary income, and net income attributable to owners of parent company are expected to achieve their targets for the fiscal year ending March 2025 one year ahead of schedule.Plans for the fiscal year endi
Slide 38: KOMEHYO Kannon-dori store (tentative name) to open in late April 2024
To expand the customer base, “KOMEHYO Kannon-dori store (tentative name)” will open in late April 2024 Due to rising sales prices in primary distribution, branded items are becoming difficult to obtain. Against this background, we will open a store in the well-known Nagoya Osu area that sells used b
Slide 39: Global expansion ①
Global expansion ① Supplying good quality used goods leveraging the trust engendered by "Checked by KOMEHYO Group." In the future, we will aim for overseas sales including e-commerce sales to account for 30% of total sales. 【Planning to expand city】We will expand into major cities and engage in purc
Slide 40: Global expansion ②
Global expansion ② We will roll out the multi-channel and multi-brand strategies of the domestic business globally. Working from Hong Kong as our base, we will aim to achieve a "re-use value chain" through which goods are distributed globally. Purchase Sale Hong Kong new company (to be integrated in
Slide 41: IR contact
IR contact IR・PR Department Phone：+81-52-249-5366 E-mail：ir@komehyo.co.jp Note: This document is an English translation of a document prepared in Japanese. Statements in this document that are not historical facts; statements concerning current plans, forecasts, strategies, and opinions of KOMEHYO C