Komehyo Holdings Co., Ltd. · TSE:2780
Komehyo — Q1 FY2023 Earnings Presentation
54 slides from Komehyo's earnings presentation, Aug 12, 2022
Slide 1: Earnings Results Briefing for the First Quarter of FY Ending March 31, 2023
Earnings Results Briefing for the First Quarter of the Fiscal Year Ending March 31, 2023 August 12, 2022 Komehyo Holdings Co., Ltd. Securities code: 2780 (Tokyo and Nagoya Stock Exchanges) IR・PR Department TEL +81-52-249-5366 Email ir@komehyo.co.jp
Slide 2: Contents
Contents １．Overview of Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information 1
Slide 3: Overview of Financial Results for the First Quarter
１．Overview of Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information 2
Slide 4: FY 2023 1Q Financial Summary
FY 2023 1Q Financial Summary 【Brand・Fashion business】 ・Net sales increased 34.0% YoY and operating income also increased 54.5% YoY. Operating profit margin grew by 0.5pt YoY. ・Record high purchases from individuals due to store openings and purchase events, etc., with openings of 11 purchase centers
Slide 5: Revision of results forecasts for the first half and the fiscal year
Revision of results forecasts for the first half and the fiscal year ending March 31, 2023 Sales exceeded the initial plan due to strong individual purchases and ample inventory. In addition, we were able to control expenses through advertising that emphasized efficiency, so each profit was increase
Slide 6: Shareholder return
Shareholder return The annual dividend forecast is revised upwards from 44 yen to 50 yen per share, in consideration of the projected income level and others for the fiscal year ending March 31, 2023. Aiming to increase dividends consistently in line with the status of profit and cash flow. 92.4 Pay
Slide 7: Economic Trend
Economic Trend KOMEHYO's net sales are hardly affected even under the pandemic. Demand for high-priced items was strong. 30,000 Nikkei Stock Average(monthly closing price)(yen) 20,000 Department store(fine arts/jewelry/precious metals)(10 millions of yen) KOMEHYO Net sales(Millions of yen) 6,000 5,0
Slide 8: Overview of income statement
Overview of income statement (Millions of yen) FY2021 1Q FY2022 1Q FY2023 1Q Change※ YoY※ Net sales 7,861 14,162 18,753 4,591 132.4% Gross profit 1,888 3,985 4,717 732 118.4% Gross profit margin 24.0％ 28.1％ 25.2％ △2.9pt － SG&A expenses 2,748 3,476 3,978 502 114.4% Operating income △860 508 739 230 1
Slide 9: Operating income increase and decrease factor
Operating income increase and decrease factor Purchases from individuals remained strong and net sales increased. Operating income grew significantly thanks to expense control and other efforts. 1,155 Operating income △ 422 (Million of yen) 739 △ 502 508 Increase in selling expenses such as advertis
Slide 10: Changes in selling, general and administrative expenses
Changes in selling, general and administrative expenses SG&A ratios declined due to efficiency-oriented advertisements. SG&A expenses to sales ratio(%) 35.0 24.5 21.2 1,456 1,388 Increase in general and administrative expenses such as commission payments ＋68 1,077 Increase in personnel expenses 1,74
Slide 11: Non-operating income(loss) / Extraordinary income(loss)
Non-operating income(loss) / Extraordinary income(loss) Rent expense on store (construct in progress)47 Impairment loss 1 Interest expenses 14 Loss on retirement of fixed assets 1 Other 2 Non-operating loss 64 Extraordinary loss 2 (Millions of yen) Non-operating income 85 Extraordinary income 3 Gran
Slide 12: Balance sheet overview
Balance sheet overview FY2023- (Millions of yen) FY2022 Change 1Q Current assets 29,453 33,311 ＋3,857 →Cash on hand increased due to buoyant purchases Cash and deposits 9,080 9,946 ＋866 from individuals. →Inventories increased with improved purchases Inventories 15,308 18,208 +2,900 from individuals
Slide 13: Overview by segment
Overview by segment In the Brand Fashion business, both sales and profit increased thanks to strong purchases from individuals and the strong results of auctions for companies. Sales and profit also increased in the Tire and Wheel business owing to the strong sales of custom products. (million of ye
Slide 14: Breakdown of consolidated Net sales (Retail / Overseas)
Breakdown of consolidated Net sales (Retail / Overseas) Corporate sales had a higher percentage due to strong purchases and for keeping stock new and fresh, whereas retail was also bullish, keeping its share at slightly below 50%. The ratio of overseas sales dropped temporarily, attributable mainly
Slide 15: Purchase from individual customers (Group total)
Purchase from individual customers (Group total) Purchases from individuals remained favorable with the opening of Komehyo’s purchasing centers, the holding of KAITORI Go purchasing events, and an increase in the amount of purchases per customer. Number of stores 148 137 148 116 126 109 109 93 Purch
Slide 16: Trends in Consolidated Net sales and Gross Profit Margin
Trends in Consolidated Net sales and Gross Profit Margin In FY2022 4Q, corporate sales with a low gross margin increased significantly, mainly reflecting the steep rise in gold market price. Gross profit margin(%) 28.1 28.1 25.6 26.3 25.2 24.2 25.2 24.0 Net Sales (Millions of yen) 21,276 18,753 19,2
Slide 17: Changes in corporate auction trade volume
Changes in corporate auction trade volume JBA auctions (particularly the offline auctions in Kanazawa) continued to be strong due to an increase in the number of registered members. The total volume of auctions among companies increased 29% YoY. Number of registered members 3,280 3,095 3,124 3,280 2
Slide 18: E-commerce-induced sales rate(KOMEHYO)
E-commerce-induced sales rate(KOMEHYO) While the infection situation of the new corona is calming down, shopping habits via EC are firmly established Focus on own EC site (KOMEHYO ONLINE) with high advertising cost-effectiveness by controlling the number of listings on other companies' sites E-comme
Slide 19: Overview of Financial Results for the First Quarter
１．Overview of Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information 18
Slide 20: Stores: Group total 148 stores (As of June 2022)
Stores：Group total 148 stores（As of June 2022 ) The figure in parentheses ( ) represents the increase during the first quarter. Brand Fashion Tire and Wheel Flagship stores 5 － ２ 1 － － － Sales Stores － 2 － 6 2 － － Stores annexed with sales facilities 12 6 2 － － 10 4 Purchasing Center 67 ( 8 ) － 8 －
Slide 21: Effect of opening the purchase center (KOMEHYO)
Effect of opening the purchase center (KOMEHYO) More than 30 purchase centers have been opened since the previous fiscal year, and 100 purchase centers will have been opened in the three years, in places where customers pass by daily. We are planning to increase purchase from individual customers by
Slide 22: Efforts to strengthen purchasing (KOMEHYO)
Efforts to strengthen purchasing（KOMEHYO） Eight purchasing centers launched 33 purchase events held Mainly inside large commercial facilities in an extensive area from • At commercial facilities and department stores considered to Kanto to Kyushu be reassuring, familiar and close to consumers since
Slide 23: Efforts to strengthen purchasing (K-BRAND OFF)
Efforts to strengthen purchasing（K-BRAND OFF） A hundred franchised purchase centers will be set up in the three-year period starting in the previous fiscal year. We are aiming to introduce at least 20 new stores by the end of the current fiscal year. Items purchased at franchise purchase centers are
Slide 24: Product distribution (FY2023-1Q KOMEHYO)
Product distribution (FY2023-1Q KOMEHYO) ・Stores ・Stores ・Home delivery Purchase from ・Suitable for retail ・Web Purchasing individual customers Retail KOMEHYO ・Purchasing at website events 77％ 38％ Others ・Purchasing at website visited sites KOMEHYO Product center Quality Market price 45％ 27％ 23％ 4％
Slide 25: Continue strengthening OMO (KOMEHYO)
Continue strengthening OMO（KOMEHYO） contact center A contact center was set up in August 2020 as a function Customer services on smartphones Live Commerce for the e-commerce. It responds to inquiries on goods, how to operate and A total of 287 staff members across the country holds Chinese influence
Slide 26: Technology indispensable to store operation: AI
Technology indispensable to store operation：AI The system has been introduced to all the KOMEHYO purchase centers, all of K-Brand Off's franchised purchase centers and some of the LINK SMILE and USED MARKET shops. It will be introduced to purchase events and to the global business. It is a technolog
Slide 27: Format of auctions among companies
Format of auctions among companies KOMEHYO Auction and JBA complement each other in terms of area, date and format of the event. Frequency of corporate auctions Jewels / watches / Online auction 2 times/ month bags Apparel Online auction Monthly clothing JBA Real auction Monthly Kanazawa JBA Tokyo O
Slide 28: Oversea (SAHA KOMEHYO (Thailand))
Oversea（SAHA KOMEHYO (Thailand)） The Delivery Buying Service, a purchase service for existing customers that involves a pickup of goods to be purchased, was commenced in May 2022 for the purpose of strengthening contact-free purchase services. Users send an application on the LINE app and the goods
Slide 29: Tire and Wheel
Tire and Wheel Sales and income rose to attain a positive operating income figure in the first quarter since the fiscal year ended March 31, 2013. CRAFT Auto Parts Japan 4×4 engineering service The 50th anniversary event was held to increase • Strengthened full-year sales of winter items online and
Slide 30: Reference Information
１．Overview of Financial Results for the First Quarter of the Fiscal Year Ending March 31, 2023 ２．Initiatives for the First Quarter of the Fiscal Year Ending March 31, 2023 ３．Reference Information 29
Slide 31: Corporate Profile
Corporate Profile Company name Komehyo Holdings Co., Ltd. Established May 1979 ※Transition to holding company system in October 2020 Head Office 3-25-31 Osu, Naka-ku, Nagoya Representative President, Representative Director: Takuji Ishihara Capital 1,803 million yen No. of Consolidated: 987 Non-cons
Slide 32: Corporate History
Corporate History ●Acquired Eve Corporation Co.,Ltd. ●Established Auto Parts KOMEHYO (currently AUTO PARTS JAPAN) ●Established KOMEHYO HONG KONG LIMITED ●Transition to a holding ● Acquired CRAFT Co., Ltd. company structure ●Established KOMEHYO Auction ●Opened the second store in Bangkok, ●Opened KOM
Slide 33: Mission
Mission 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 f
Slide 34: 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 35: KOMEHYO HD Group materiality (important issue)
KOMEHYO HD Group materiality (important issue) Work on four tasks of purchase, sales, appraisal, and restoration to realize the circulation of value through environmentally and socially conscious recycling, in pursuit of both promotion and growth of reuse and value improvement of used goods. Purchas
Slide 36: A value chain where value circulates through relay use
A value chain where value circulates through relay use Developing the reuse market further Making reuse a common practice in society Contributing to the development of the reuse market by proposing quality Making it a common practice to sell goods which will no longer be used items, taking advantage
Slide 37: Corporate governance system
Corporate governance system The Group's management efficiency and business performance are aimed at respecting the interests of not only shareholders, but also employees, customers, business partners, creditors, local communities, and other people who have great influences and interests. We are work
Slide 38: Officer system / Skills matrix
Officer system Name Takuji Ishihara Toshio Sawada Yuya Yamauchi Masaru Hirauchi Yoshiko Nakahara Kazutoshi Torita Momoko Murase Miyuki Minamiru Director Outside Director Outside Director President and Title Managing Director Director Outside Director Outside Director (Audit and Supervisory (Audit an
Slide 39: Business system diagram
Business system diagram purchase Sales General customers, etc. Stores Stores General customers, etc. Home delivery Purchasing WEB Purchasing at Auction Used goods business events Purchasing at visited sites Used goods business New and used goods business Auctions by other companies 38
Slide 40: Medium-term management target (until FY2025)
Medium-term management target (until FY2025) FY2023 *1 FY2024 *2 FY2025 *2*3 (Millions of yen) 1H Full year Full year Full year Net sales 38,500 82,500 85,000 100,000 Operating income 1,550 4,350 4,400 5,500 Operating profit margin 4.0％ 5.3％ 5.2% 5.5% Ordinary income 1,430 4,350 4,400 5,500 Net inco
Slide 41: Sales plan
Sales plan (Millions of yen) 100,000 85,000 82,500 71,148 57,510 50,960 50,723 45,903 45,497 43,199 40,212 40,134 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 40
Slide 42: Operating Profit Plan
Operating Profit Plan 7.5 7.2 Operating Income 6.1 Margin (%) 5.2 5.3 5.2 5.5 3.6 3.7 2.1 1.2 0.5 5,500 4,350 4,400 Operating Income 3,714 (Millions of yen) 2,999 3,129 2,789 1,860 1,625 590 297 832 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025 41
Slide 43: Ordinary income/Net income Plan
Ordinary income/Net income Plan Net income attributable Ordinary to owners of 5,500 income parent (Millions of yen) 4,350 4,400 3,772 3,450 3,162 2,988 2,742 2,830 2,850 2,259 2,040 1,834 1,826 1,696 1,610 1,073 1,009 815 355 431△ 595 9 △ 234 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 F
Slide 44: Medium-term management plan: Brand Fashion, Tire/Wheel
Medium-term management plan: Continuous business expansion through investments in growth businesses and human resource development Brand Fashion BtoC BtoB Oversea １．Achieving growth with existing core businesses ２．Achieving growth with businesses that contribute to the distribution of used goods to
Slide 45: Growth in the brand reuse market image
Growth in the brand reuse market image Important investment items ③Businesses that contribute to distribution ・Human resource recruitment and development ・Stores (openings/reorganization) ・IT (reuse technologies) ②Businesses that contribute to market growth ・Marketing ・Sustainability Businesses base
Slide 46: Medium-term Management Plan: Brand・Fashion
Medium-term Management Plan : Brand・Fashion Gaining more influence in the reuse market by making maximum use of the Group's assets １．Achieving growth with existing core businesses ＝Domestic＝ ・Increasing the number of purchasing channels (continuing to open purchase centers and strengthening alliance
Slide 47: Medium-term Management Plan: Brand・Fashion
Medium-term Management Plan : Brand・Fashion Gaining more influence in the reuse market by making maximum use of the Group's assets ２．Achieving growth with businesses that contribute to the distribution of used goods to revitalize the market ・Auctioning more items through franchise development (openi
Slide 48: Medium-term Management Plan: Tire・Wheel
Medium-term Management Plan : Tire・Wheel Expanding the business by strengthening profitability and investing in growth drivers １．Strengthening profitability through collaboration among the three companies ・Strengthening and opening specialty stores developed according to customer preference ・Strengt
Slide 49: Store development in the Ginza area
January 2023 Store development in the Ginza area Ginza is an important area for strengthening retail sales. Expand stores as a group and expand contact points with customers. KOMEHYO February 15, 2022 KOMEHYO GINZA CLOSED GINZA store ● Feb 18-Aug 28 KOMEHYO GINZA LIMITED OPEN KOMEHYO GINZA PLUS imag
Slide 50: Human capital management (KOMEHYO)
Human capital management（KOMEHYO） In the business model of environmentally and socially conscious recycling, humans play a wide range of roles (knowledge, skills, expertise, speed, relationship with customers, etc.), making it important to take initiatives to develop and retain human resources. Sale
Slide 51: Human capital management (KOMEHYO)
Human capital management（KOMEHYO） Groupwide training of personnel for the next generation Education of assessors by a team dedicated to education KOMEHYO provide opportunities for groupwide training aimed at developing management personnel and executives for the next generation. KOMEHYO focuses its
Slide 52: Human resources retention rate
Human resources retention rate Employee turnover rate has been low, which means that the employee retention rate has been high. This enables to accumulate expertise, laying a foundation for stable growth. General regular workers(except part-time workers)(Ministry of Health,Laver and Welfare) Turnove
Slide 53: Sales shares by segment and by sales channel (FY2022)
Sales shares by segment and by sales channel (FY2022) By segment Brand/fashion business By sales channel by operating company Tire and Wheel Real estate leasing Other 6.1% 0.5% 10.1% K-BRAND OFF Retail 43.3% 14.8% Brand and fashion business Corporate Consolidated sales amount of sales Komehyo Sales
Slide 54: 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