Seiko Group CorporationTSE: 8050

FY2024 Q2 Consolidated Results

· Issued by Seiko Group Corporation

Consolidated Results for the 6 months FY24

(from April 1 to September 30, 2024)

November 13, 2024

  1. Summary
  2. Consolidated Results
  3. Financial Forecast for FY24

1

  1. Summary
  2. Consolidated Results
  3. Financial Forecast for FY24

2

Summary

Actual results for 1H FY24 (Apr. - Sep. 2024)

Net Sales 151.0 billion yen (+15.0% yoy) Operating Profit 13.3 billion yen (+63.6% yoy)

Consolidated results achieved increased net sales and operating profit yoy, driven by strong performance in the EVS domain, recovery in the DS domain, and steady performance in the SS domain.

Financial Forecast for FY24

Net Sales 306.0 billion yen (no change)

Operating Profit 18.0 billion yen (no change)

No change from the previous full-year consolidated financial forecast, but revised the full-year segment-specific forecast considering uncertainties in the business environment, including exchange rates, for the third quarter and beyond.

3

  1. Summary
  2. Consolidated Results
  3. Financial Forecast for FY24

4

Consolidated P/L for 1H FY24 (Apr. - Sep. 2024)

（Billions of yen）

FY23

1H

Net Sales

131.2

Gross Profit

58.5

%

44.6%

Operating Profit

8.1

%

6.2%

Ordinary Profit

9.2

%

7.0%

Income before

9.1

income taxes

Profit attributable to

6.2

owners of parent

%

4.8%

Exchange Rates USD

141.1

(JPY)

EUR

153.5

FY24

1H

151.0

68.2

45.2%

13.3

8.8%

12.8

8.5%

12.8

8.6

5.7%

152.8

166.0

Variance

Amt. %

+19.7 +15.0%

+9.7 +16.7%

+0.6pt

+5.1 +63.6%

+2.6pt

+3.5 +38.8%

+1.5pt

+3.7 +40.6%

+2.3 +38.0%

+0.9pt

+11.7 +8.3%

+12.6 +8.2%

Breakdown of Year-on-Year Change

Net Sales: y/y

+19.7

（Exchange rate fluctuations

c. ＋5.7)

Operating Profit : y/y

+5.1

（Exchange rate fluctuations

c. ＋2.2）

Impact of increase in Net sales

+ 8.9

Impact of improved GP%

+ 0.8

Increase in SG&A expenses

- 4.5

Ordinary Profit : y/y

+3.5

Increase in Operating profit

+ 5.1

Decrease in foreign exchange gains and losses

- 1.1

Decrease in equity method investment profit and loss

- 0.2

Others

- 0.2

5

Analysis of Changes in Operating Profit for 1H FY24

■ Operating profit increased by 5.1 billion yen mainly due to an increase in net sales, despite an increase in SG&A.

（Billions of yen）

Impact of

Impact of

Increase in

increase

improved GP%

labor expenses

in Net sales

1H FY23

Operating

Profit

Exchange rate

fluctuations

c. ＋2.2

6

Increase in

advertising

Increase in other

expenses

SG&A expenses

1H FY24

Operating

Profit

Exchange rate

fluctuations

c. -1.3

Net Sales & Operating Profit by Segment for 1H FY24

Net Sales

Operating Profit

(Composition ratio)

（Billions of yen）

FY23

FY24

Variance

FY23

FY24

Variance

1H

1H

1H

1H

Watches

77.7

89.4

+11.6

9.4

13.4

+4.0

Emotional

(59%)

(59%)

Value

Others/adj.

12.2

12.2

+0.0

0.1

0.2

+0.1

Solutions

(9%)

(8%)

Sub Total

89.9

101.7

+11.7

9.5

13.6

+4.1

Devices Solutions

27.6

30.3

+2.7

0.2

1.1

+0.9

(21%)

(20%)

Systems Solutions

18.9

23.5

+4.6

2.2

2.3

+0.1

(14%)

(16%)

17.2

Sub Total

136.5

155.5

+19.0

12.0

+5.2

Others

0.5

0.5

-0.0

0.1

0.0

-0.0

(0%)

(0%)

-5.1

Cons. adj.

-5.7

+0.6

-4.0

-4.0

+0.0

(-4%)

(-3%)

Cons. Total

131.2

151.0

+19.7

8.1

13.3

+5.1

7

EVS Domain

■ Achieved increases in both net sales and operating profit due to significant net sales growth in the Watches Business and WAKO Business for the domestic market.

＜Net Sales＞

188.3

170.7

45.7

4Q

41.2

52.5

3Q

46.3

2Q

44.1

47.6

83.1

89.9

1Q

39.0

42.3

(Billions of yen)

202.0

100.2 2H forecast

51.7

101.7

49.9

＜Operating Profit＞

17.2

1.2

11.5

6.4

4Q

0.5

3Q

4.0

6.0

2Q

4.5

6.9

1Q

2.4

3.4

(Billions of yen )

＜OP Margin＞

20.7

1Q

2Q

3Q

4Q

Total

1H

FY24

11.6%

15.2%

13.5%

FY23

8.2%

12.7%

12.2%

2.8%

9.2%

10.6%

7.0

2H forecast

FY22

6.2%

10.3%

8.7%

1.4%

6.8%

8.4%

7.8

13.6

9.5

5.8

FY2022 FY2023 FY2024

FY2022

FY2023

FY2024

8

Watches Business

Completed

■ In the domestic watch market, robust personal consumption and demand from inbound tourists drove

Watches

significant sales growth, particularly for Global Brands such as GS and 'Seiko Prospex'.

■ Overseas net sales grew, contributed by 'Seiko Presage', resulting in increased net sales yoy.

Movements

■ The external sales of watch movements grew steadily, resulting in increased net sales yoy.

＜Net Sales＞

160.0

144.2

4Q

37.8

33.9

44.4

3Q

38.4

(Billions of yen )

172.0

82.5

2H forecast

＜Operating Profit＞

15.6

0.7

11.1

5.5

4Q

0.3

3Q

3.4

19.0

5.5

7.6

(Billions

＜OP Margin＞

of yen )

1Q

2Q

3Q

4Q

Total

1H

FY24

13.0%

17.0%

15.1%

2H forecast

FY23

9.6%

14.4%

12.4%

1.9%

9.8%

12.1%

FY22

7.9%

12.1%

9.0%

1.2%

7.7%

10.1%

2Q

37.8

41.1

71.8

77.7

1Q

33.9

36.5

45.1

89.4

44.2

5.9

13.4

2Q

4.5

9.4

7.2

5.7

3.5

1Q

2.6

FY2022 FY2023 FY2024

FY2022

FY2023

FY2024

9