Pola Orbis Holdings Inc. · TSE:4927
Pola Orbis — H1 2014 Earnings Presentation
24 slides from Pola Orbis's earnings presentation, 2014
Slide 1: First Half of Fiscal 2014 Supplementary Material
First Half of Fiscal 2014 Supplementary Material POLA ORBIS HOLDINGS INC. President Satoshi Suzuki This report contains projections of performance and other projections based on information currently available and certain assumptions judged to be reasonable. Actual performance may differ materially
Slide 2: Agenda
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2014 4. Reference 1
Slide 3: H1 Key Topics
H1 Key Topics Cosmetic Market Due to the tax hike, the market experienced sales slowdown from April, but overall consumer sentiment is still improving. In China, competition is intensifying and personnel expenses, and rents are on the rising trend. Department stores in major cities, mainly on th
Slide 4: Analysis of Consolidated P&L Changes: Net Sales to Operating Income
Analysis of Consolidated P&L Changes Net Sales to Operating Income FY2013 FY2014 YoY (mil. yen) H1 Results H1 Results Amount % Consolidated net sales 91,415 95,940 4,524 4.9% Cost of sales 18,281 18,586 305 1.7% Gross profit 73,134 77,354 4,219 5.8% SG&A* expenses 66,829 69,022 2,193 3.3% Operating
Slide 5: Analysis of Consolidated P&L Changes: Operating Income to Net Income
Analysis of Consolidated P&L Changes Operating Income to Net Income FY2013 FY2014 YoY (mil. yen) H1 Results H1 Results Amount % Operating income 6,305 8,331 2,026 32.1% Non-operating income 1,080 328 (752) (69.6%) Non-operating expenses 50 616 565 1110.6% Ordinary income 7,335 8,043 708 9.7% Extraor
Slide 6: Factors Impacting Net Income
Factors Impacting Net Income Significant increase in gross profit due to the last-minute surge in demand before the tax hike, and elimination of extraordinary losses occurred during the same period last year led to increase in net income. (mil. yen) Positive impact Negative impact 10,000 Increased g
Slide 7: Agenda: Segment Analysis
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2014 4. Reference 6
Slide 8: Segment Results
Segment Results FY2013 FY2014 YoY (mil. yen) H1 Results H1 Results Amount % Consolidated net sales 91,415 95,940 4,524 4.9% Beauty care 85,336 89,400 4,064 4.8% Real estate 1,493 1,571 77 5.2% Others 4,586 4,968 381 8.3% Operating income 6,305 8,331 2,026 32.1% Beauty care 5,703 7,772 2,068 36.3% Re
Slide 9: Beauty Care Business Results by Brands
Beauty Care Business Results by Brands FY2013 FY2014 YoY (mil. yen) H1 Results H1 Results Amount % Beauty care net sales 85,336 89,400 4,064 4.8% POLA 48,888 49,650 761 1.6% ORBIS 23,647 25,245 1,598 6.8% Jurlique 6,236 7,294 1,057 17.0% H2O PLUS 2,472 2,348 (123) (5.0%) Brands under development 4,0
Slide 10: Brand Analysis (1)
Brand Analysis (1) H1 Results Quarter topics Impacts from the tax hike were in line with Launched B.A the protector S in April. expectations. POLA THE BEAUTY stores continued to be a sales driver. Successfully acquired new customers. H1 Results (mil. yen) YoY Quarterly net sales Net sales 49
Slide 11: Brand Analysis (2)
Brand Analysis (2) H1 Results Quarter topics Realized increases in sales and operating income. Launched Sunscreen ® shower in June. ORBIS =U launched in February, continued to show strong sales, and the drop in demand after the tax hike was within expectation. Continued to successfully acquire
Slide 12: Brand Analysis (3)
Brand Analysis (3) H1 Results Quarter topics In spited of limited new store openings, sales in China Launched Purely White series in increased with solid sales at existing stores. April in China. Also, Hong Kong performed well and sales was up by 21% YoY on local currency basis. H1 Results (mil.
Slide 13: Brand Analysis (4)
Brand Analysis (4) H1 results Quarter topics Continued to struggle in China. Sales was weaker Changed a management structure at JV to recover than the same period last year. the business in China. Sales was down by 11% YoY on local currency basis. H1 Results (mil. yen) YoY(1) Quarterly net sal
Slide 14: Brand Analysis (5) Brands Under Development
Brand Analysis (5) Brands Under Development H1 results Quarter topics With successful new products launches, THREE THREE and decencia recorded more performed strongly even after the tax hike. than 60% increases in sales after the decencia successfully increased number of customers tax hike. an
Slide 15: Agenda: Forecasts for Fiscal 2014
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2014 4. Reference 14
Slide 16: Forecasts for FY2014 (No change since April 30)
Forecasts for FY2014 (No change since April 30) Domestic brands, especially flagship brands are performing strongly, and they will fill in for underperforming overseas brands to meet the annual consolidated targets. FY2014 YoY FY2014 YoY (mil. yen) Full Year Amount % H1 Results Amount % Consol. net
Slide 17: Initiatives for FY2014 Q3 Onward
Initiatives for FY2014 Q3 Onward Realizing 2014 - 2016 Medium-term Management Plan Sustain stable growth of flagship brands to lead Group earnings Launched tailor-made skincare and make-up series, APEX, in July to strengthen consulting skills of POLA ladies, and increase shares in anti-aging marke
Slide 18: Agenda: Reference
1. Highlights of Consolidated Performance 2. Segment Analysis 3. Forecasts for Fiscal 2014 4. Reference Download historical financial data here. http://ir.po-holdings.co.jp/en/Library/Factsheet.html 17
Slide 19: (Reference) POLA main product series
(Reference) POLA main product series B.A APEX WHITISSIMO WHITE SHOT Anti-aging Anti-aging Skin-whitening The most prestige skincare and Launched in 1989 as the first Skin-whitening series infused with foundation make-up series at POLA. tailor-made skincare and foundation the latest research findings
Slide 20: (Reference) About POLA ORBIS Group
(Reference) About POLA ORBIS Group Beauty care is the core business of the Group, and 9 different cosmetic brands are operated under the Group umbrella. FY2013 Consol. Net Sales ¥191.3 bil. Overseas Flagship Brands under Brands Brands development High prestige ¥10,000 Prestige Beauty care business 9
Slide 21: (Reference) Beauty Care Business Brand Portfolio
(Reference) Beauty Care Business Brand Portfolio Sales Brand Concept and products Price Sales channel ratio* Consignment sales through POLA LADIES： High-prestige skincare Approx. POLA THE BEAUTY (PB), 57% Leading-edge technology in anti- ¥10,000 Esthe-inn and conventional door-to-door aging an
Slide 22: (Reference) Long-term Vision
(Reference) Long-term Vision Corporate Philosophy STAGE3 “Inspire all people and touch their hearts” Become a highly profitable global enterprise Consolidated Net sales STAGE2 Goals for FY2020: (bil. yen) •Consol. net sales: ¥250.0 bil. or higher Further strengthen domestic •Overseas sales ratio: 20
Slide 23: (Reference) 2014–2016 Medium-term Management Plan
(Reference) 2014–2016 Medium-term Management Plan The 2nd stage of the long-term vision for 2020 Aim to enhance the enterprise value by further strengthening domestic earnings structure, accelerating overseas expansion, and improving capital efficiency. Consolidated net sales Capital efficiency Co
Slide 24: (Reference) Domestic Cosmetic Market
(Reference) Domestic Cosmetic Market In 2013, domestic cosmetic market showed 1.8% growth. However, in the past five years, it remained flat. Market ratio increased in skin-whitening and anti-aging fields, and high prestige products priced higher than ¥10,000, where the Group puts efforts in. Domest