Kokuyo : Summary of Financial Results for the First Quarter of the Fiscal Year Ending December 31, 2024 （1,500KB）

Summary of Financial Results for the First Quarter of the Fiscal Year

Ending December 31, 2024

May 8, 2024

KOKUYO Co., Ltd.

Contents

1. First Quarter FY2024 Results
2. Reference Materials

• The business segments are as follows:
  Furniture Businesses: FN
  Business Supply Distribution: BS
  Stationery Businesses: ST
  Interior Retail Businesses: IR
• Unless otherwise indicated, monetary figures are rounded down to the nearest million yen.
  As such, the sum of the figures in a breakdown may not match the stated total.

Executive Summary

First Quarter FY2024 Results

• Net sales and operating income increased YoY, with performance, particularly among the Japanese businesses, better than in same period last year.
• The Japanese businesses fared largely as expected, with the furniture business doing well in winning contracts and with sales price revisions in the stationery business.
• Overseas, economic uncertainties mounted. Performance was affected by the Chinese economic downturn and, in India, by inflation and intensifying competition.
• Net income increased significantly YoY, reflecting recording of gain on sale of fixed assets in addition to operating income growth.

FY2024 Forecasts: H1 and Full-Year

• Forecasts remain unchanged from the initial forecasts, announced on February 13, 2024.
• While continuing to monitor the situation in overseas markets, we'll pursue YoY revenue and profit growth by continuing to capitalize on brisk demand in the domestic furniture business.
• Net income in 2024 is likely to break another record, and we are likely to meet our ROE benchmark of 8%, thanks to organic business growth and sale of cross-held shares.
• For shareholder returns, we will pay an annual dividend of 76 yen per share (payout ratio of 40.5%).

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© 2024 KOKUYO Co., Ltd.

1. First Quarter FY2024 Results

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© 2024 KOKUYO Co., Ltd.

First Quarter FY2024 Results: Year on Year Comparisons

Net sales and operating income increased YoY, with performance,

particularly among the Japanese businesses, better than in same period last year.

Net income increased significantly YoY, reflecting recording of gain on sale of fixed assets.

	Jan-Mar FY2023	Jan-Mar FY2024	YoY change	% change
	result	result
Net sales	92,555	95,935	+3,379	+3.7%
Gross profit	37,119	39,375	+2,256	+6.1%
(ratio)	40.1%	41.0%
SG&A expenses	26,300	27,710	+1,409	+5.4%
(ratio)	28.4%	28.9%
Operating income	10,818	11,665	+846	+7.8%
(ratio)	11.7%	12.2%
Ordinary income	11,222	12,565	+1,342	+12.0%
(ratio)	12.1%	13.1%
Net income attributable	7,679	11,978	+4,299	+56.0%
to owners of parent
(ratio)	8.3%	12.5%			5

© 2024 KOKUYO Co., Ltd.

First Quarter FY2024 Results: Contributors to YoY Change in Net Sales

Japan: Growth led by furniture business, which did well in winning contracts

Overseas: Decrease in furniture business, reflecting worsening economic conditions

		(Millions of yen)
Japan	Overseas	Reconciliation
+4,658	-1,599	+320

			Foreign
				Reconciliation
Jan-Mar	Other			Jan-Mar
FY2023 result			exchange				FY2024 result	6

© 2024 KOKUYO Co., Ltd.

First Quarter FY2024 Results: Contributors to YoY Change in Operating Income

Profit growth was led by revenue growth and better margins in Japanese furniture businesses,

more than offsetting the decrease in the overseas businesses

		(Millions of yen)
Japan	Overseas	Reconciliation
+1,888	-626	-415

Jan-Mar		Other		Foreign			Jan-Mar
		Reconciliation
FY2023 result				exchange			FY2024 result	7

© 2024 KOKUYO Co., Ltd.

Contributors to YoY Change in Operating Income

The impact of cost increases was again offset by another round of price revisions in the Japanese stationery

business and business-supplies business.

The strategic budget was proactively spent in preparation for fourth medium-term plan.

Gross profit	SG&A expenses	(Millions of yen)
+2,256	-1,410

Jan-Mar

Impact of

Impact of sales

Impact of sales

Personnel

Activity

Capital

IT system

Other

Jan-Mar

FY2023 result

higher raw

price revision

expansion

expenses

expenses

expenditures

expenditures

FY2024 result

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materials costs

© 2024 KOKUYO Co., Ltd.

Situation by Region

Japan: Capitalizing on demand well amid market environment similar to expectations

Overseas: Businesses effected by market fluctuations that transcended expectations

Region	Initial expectations	Market changes	Impacts	Actions to take
	Market will be bullish with		FN: Capitalized on strong	Capitalize on demand further
Japan	brisk building supply and	Largely as expected	by focusing on renovations and
demand
	low vacancy rates		regional leads

Mainland			FN: Won fewer contracts
China,	Economic uncertainties
Economy worsened	than expected
Hong	will persist
	ST: Growth slowed
Kong

FN: Secure projects steadily, strengthen exports, go further in PMI

ST: Open new outlets, improve promotional marketing

		・Economy fared well		Launch new product
		・Inflation weakened
India	Economy will fare well	ST: Growth slowed	categories, improve
consumer spending

・Competition intensified	promotional marketing

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© 2024 KOKUYO Co., Ltd.

Full-Year FY2024 Forecasts: Year on Year Comparisons

Forecasts remain unchanged from those announced on February 13, 2024.

Our strategy is to invest in preparation for the next medium-term plan and take other actions to unlock further growth.

	2023 result	2024 target	YoY change	% YoY change
Net sales	328,753	355,000	+26,247	+8.0%
Gross profit	127,392	140,100	+12,708	+10.0%
(ratio)	38.8%	39.5%
SG&A expenses	103,561	115,600	+12,039	+11.6%
(ratio)	31.5%	32.6%
Operating income	23,830	24,500	+670	+2.8%
(ratio)	7.2%	6.9%
Ordinary income	25,989	25,500	-489	-1.9%
(ratio)	7.9%	7.2%
Net income attributable	19,069	21,400	+2,331	+12.2%
to owners of parent
(ratio)	5.8%	6.0%
ROE	7.8%	>8%

(Millions of yen)

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© 2024 KOKUYO Co., Ltd.