Financial Results for the Fiscal Year Ended May 15, 2020 [J-GAAP]
Name of listed company: Securities code: Representative: Contact:
TSURUHA Holdings, Inc. 3391
Listed on: Tokyo Stock Exchange, 1st Section URL:http://www.tsuruha-hd.co.jp
Jun Tsuruha, President and Representative Director
Makoto Murakami, Executive Officer and Chief Administrative Officer
June 22, 2020
TEL: +81-11-783-2755
Scheduled date of holding the ordinary general meeting of shareholders: | August 11, 2020 |
Scheduled date of filing the financial report: | TBD |
Scheduled date to start dividends distribution: | July 20, 2020 |
Supplementary documents for this summary of financial statements: | Yes |
Explanation meeting for financial results: | Yes |
(Figures shown are rounded down to the nearest million yen.) |
1. Consolidated results for the year ended May 15, 2020 (May 16, 2019 - May 15, 2020)
(1) Consolidated operating results
Year ended May 15, 2020
Year ended May 15, 2019
Net SalesMillions of yen 841,036 782,447
% 7.5 16.2
Millions of yen 45,013 41,826
(Percentage figures show changes from the previous year.)
Ordinary Income
7.6 4.0
Net Income Attributable to Owners of the Parent
% Millions of yen enyen 46,298
43,313
% Millions of yen 6.9
4.1
27,899 24,824
% 12.4 0.1
Note: Comprehensive income: Year ended May 15, 2020: ¥37,561 million (67.7%) Year ended May 15, 2019: ¥22,395 million (-32.3%)
Net Income per Share | Diluted Net Income per Share | Return on Shareholders' Equity | Ordinary Income to Total Assets | Operating Income to Net Sales | |
Year ended May 15, 2020 Year ended May 15, 2019 | Yen 576.85 513.84 | Yen 574.80 511.70 | % 12.7 12.5 | % 11.8 12.2 | % 5.4 5.4 |
(Reference) Equity in earnings of affiliates: Year ended May 15, 2020: ¥- million Year ended May 15, 2019: ¥- million
(2) Consolidated financial position
Total Assets | Net Assets | Shareholders' Equity Ratio | Net Assets per Share | |
As of May 15, 2020 As of May 15, 2019 | Millions of yen 414,002 372,293 | Millions of yen 250,934 220,214 | % 56.4 55.0 | Yen 4,821.26 4,238.15 |
(Reference) Equity capital: As of May 15, 2020: ¥233,389 million
As of May 15, 2019: ¥204,922 million
(3) Consolidated cash flows
Cash Flows from Operating Activities | Cash Flows from Investing Activities | Cash Flows from Financing Activities | Cash and Cash Equivalents at End of Year | |
Year ended May 15, 2020 Year ended May 15, 2019 | Millions of yen 40,636 33,701 | Millions of yen (16,927) (24,990) | Millions of yen (10,473) (9,136) | Millions of yen 56,935 43,700 |
2. Dividends
Dividends per Share | Total Dividends (annual) | Dividends Payout Ratio (consolidated) | Dividends on Net Assets (consolidated) | |||||
First Quarter -end | Second Quarter -end | Third Quarter -end | Year-end | Annual | ||||
Year ended May 15, 2019 Year ended May 15, 2020 | Yen ― ― | Yen 73.00 74.00 | Yen ― ― | Yen 75.00 93.00 | Yen 148.00 167.00 | Millions of yen 7,155 8,080 | % 28.8 29.0 | % 3.6 3.7 |
Year ending May 15, 2021 (Forecast) | ― | 83.50 | ― | 83.50 | 167.00 | 29.9 |
3. Consolidated financial forecast for the fiscal year ending May 15, 2021 (May 16, 2020 - May 15, 2021)
(Percentage figures show changes from the same period in the previous year.)Net Sales
Operating Income
Ordinary IncomeNet Income Attributable to Owners of the Parent
Net Income per Share
First six months Full yearMillions of yen 424,400 860,000
% 1.9 2.3
Millions of yen 21,550 45,200
%
(9.3)
0.4
Millions of yen 22,193 46,484
%
(9.2)
0.4
Millions of yen 13,480 27,000
%
(13.3) (3.2)
Yen 278.53 557.89
* Notes
(1) Significant changes to subsidiaries during the term (Transfers of specific subsidiaries with changes in the scope of consolidation): None
(2) | Changes in accounting policies, accounting estimates and restatement of revisions |
1) Changes in accounting policies due to revision of accounting standard, etc.: | None |
2) Changes in accounting policies other than 1): | None |
3) Changes in accounting estimates: | None |
4) Restatement of revisions: | None |
(3) Number of outstanding shares (common stock):
1) Number of shares issued and outstanding (including treasury stock)
2) Number of treasury stock
3) Average number of shares issued and outstanding in each period
As of May 15, 2020 | 49,282,868 shares | As of May 15, 2019 | 49,237,968 | shares |
As of May 15, 2020 | 886,255 shares | As of May 15, 2019 | 886,098 | shares |
Year ended May 15, 2020 | 48,365,452 shares | Year ended May 15, 2019 | 48,312,034 | shares |
* This kessan tanshin document is outside the scope of audit procedures conducted by certified public accountants or the independent auditor.
* Explanation of appropriate use of financial forecasts and other special items
The forward-looking statements in this document, including forecasts, are based on information available at the time of disclosure and on certain assumptions deemed to be reasonable by the Company. Actual results may differ materially from forward-looking statements due to a number of factors. For more details about these assumptions and other conditions that form the basis of these forecasts, please refer to page 3 of the supplementary materials, "1. Summary of financial results and other information, (4) Business forecasts."
(Access to financial results briefing documents)
Financial results briefing documents are disclosed on the Company's website on the same day as the briefing (Japanese version only).
Contents
3. Consolidated financial statements and related notes ............................................................................................................. 4
(1) Consolidated balance sheets ............................................................................................................................................. 4
(2) Consolidated statements of income and comprehensive income ..................................................................................... 6
(Consolidated statements of income) ............................................................................................................................... 6
(Consolidated statements of comprehensive income) ...................................................................................................... 8
(3) Consolidated statements of changes in net assets ............................................................................................................. 9
(4) Consolidated statements of cash flows ........................................................................................................................... 11
(5) Notes on consolidated financial statements .................................................................................................................... 13
(Notes related to the going concern assumption) ........................................................................................................... 13
(Basic important matters for preparing the consolidated financial statements) ............................................................. 13
(Segment information, etc.) ........................................................................................................................................... 15
(Per share information) .................................................................................................................................................. 16
(Significant subsequent events) ................................................................................................................................... 17
4. Others ...................................................................................................................................................................................... 18
(1) Purchases and sales ........................................................................................................................................................ 18
1. Summary of financial results and other information
(1) Summary of financial results for the fiscal year ended May 15, 2020
In the fiscal year under review (May 16, 2019 to May 15, 2020), the Japanese economy continued to recover at a modest pace. However, typhoons and other natural disasters, a rush in demand before the hike to consumption tax and a subsequent pullback, as well as concerns about the impact of the COVID-19 outbreak on domestic and overseas economies and trends in capital markets, contributed to an uncertain outlook.
Meanwhile, in the drugstore sector, the operating environment remained challenging, with the pace of consolidation and realignment accelerating further amid intensifying competition to open stores and reduce prices.
Against this backdrop, the TSURUHA Group continued to offer a high level of customer service, mainly through advice-based sales, and worked to address the shrinking market caused by Japan's aging population and intensifying competition. Specifically, the Group pushed ahead with store renovations centered on food sales areas aimed at improving convenience for customers, while in private brands, the Group reinforced product development and sales structures and worked to renew and expand the private brand business by launching two new brands - Kurashi Rhythm and Kurashi Rhythm Medical. Targeting improvements in the operational efficiency of stores and enhancement of productivity, the Group also worked on introducing new support systems for staff allocation, inventory management and other functions.
In store openings, the Group targeted specific areas for multiple store openings as part of its area dominance store-opening strategy and implemented a scrap and build approach for existing stores. In the fiscal year under review, the Group opened 129 new stores and closed 63 existing stores. The Group also added two stores, comprising one store operated by Ogata Mura Pharmacy (Akita Prefecture), which became a subsidiary of TSURUHA Co., Ltd. on July 4, 2019, and one store acquired from Egashira Eizai Co., Ltd. by Tsuruha Group Drug & Pharmacy Nishinihon Inc. on May 1, 2020, resulting in a total of 2,150 directly managed stores as of the end of the fiscal year. In Thailand, the Group opened one new store and closed two stores, resulting in a total of 22 stores in Thailand as of May 15, 2020.
TSURUHA Group store openings and closures
(Number of stores)
End of previous period | Store openings | Became subsidiary, others | Store closures | Net change | End of current period | Of which dispensing pharmacies | |
Hokkaido | 401 | 23 | - | 20 | 3 | 404 | 99 |
Tohoku | 482 | 30 | 1 | 7 | 24 | 506 | 100 |
Kanto, Koshinetsu | 456 | 35 | - | 18 | 17 | 473 | 156 |
Chubu, Kansai | 223 | 14 | - | 4 | 10 | 233 | 110 |
Chugoku | 299 | 19 | - | 6 | 13 | 300 | 91 |
Shikoku | 198 | 8 | - | 7 | 1 | 211 | 56 |
Kyushu | 23 | - | 1 | 1 | 0 | 23 | 3 |
Domestic total | 2,082 | 129 | 2 | 63 | 68 | 2,150 | 615 |
(The figure at the end of the current period excludes 22 overseas stores and 4 franchise stores.)
As a result of the above, for the fiscal year under review, TSURUHA Holdings reported net sales of ¥841,036 million (up 7.5% year on year), operating income of ¥45,013 million (up 7.6%), ordinary income of ¥46,298 million (up 6.9%), and net income attributable to owners of the parent of ¥27,899 million (up 12.4%).
(2) Summary of financial position
As of the end of the fiscal year under review, assets totaled ¥414,002 million, an increase of ¥41,709 million compared with the end of the previous fiscal year. This mainly reflected an increase in merchandise related to new store openings and an increase in valuation difference on investment securities.
Liabilities totaled ¥163,067 million, an increase of ¥10,988 million compared with the end of the previous fiscal year. The main factor was an increase in notes and accounts payable - trade related to new store openings.
Net assets totaled ¥250,934 million, an increase of ¥30,720 million compared with the end of the previous fiscal year. As a result, the equity ratio was 56.4%, up 1.4 points from the previous fiscal year-end.
(3) Summary of cash flows
As of the end of the fiscal year under review, cash and cash equivalents (cash) totaled ¥56,935 million, an increase of ¥13,235 million from the end of the previous fiscal year.
The Group's cash flow position and factors affecting cash flows during the current fiscal year were as follows:
Cash flows from operating activities
Operating activities provided net cash of ¥40,636 million (up 20.6% year on year). This mainly reflected income before income taxes of ¥43,847 million, depreciation of ¥7,817 million, increase in notes and accounts payable - trade of ¥6,684 million and amortization of goodwill of ¥3,685 million. The main cash negative items were increase in inventories of ¥9,931 million and income taxes paid of ¥14,685 million.
Cash flows from investing activities
Investing activities used net cash of ¥16,927 million (down 32.3%). This primarily reflected purchase of property, plant and equipment of ¥14,148 million and payments for guarantee deposits related to new store openings of ¥6,223 million.
Cash flows from financing activities
Financing activities used net cash of ¥10,473 million (up 14.6%). This mainly reflected cash used of ¥7,205 million for cash dividends paid.
(4) Business forecasts
In the fiscal year ending May 15, 2021, the outlook for the Japanese economy is likely to remain uncertain amid concerns about the impact of the COVID-19 outbreak on economic conditions in Japan and overseas. In the drugstore sector, the operating environment is likely to remain challenging amid intensifying competition to open stores and reduce prices, as well as an accelerating pace of sector restructuring through M&As and business and capital tie-ups that transcend industry barriers.
Against this backdrop, we will work to create convenient drugstores that are close to home and satisfy customers, guided by our business philosophy of "making life better for our customers." This will include continued efforts to enhance our advice-based services, which draw on our high level of expertise in health and beauty, while working to offer convenience through lineups of high-quality, affordable products such as our private brand range. In addition, as the operator of the largest chain of drugstores in Japan, we will push ahead with marketing initiatives that make use of ID-POS data. In store openings, we plan to open 130 stores targeting specific locations, including new areas, in order to strengthen our store network using our area dominance store-opening strategy.
Based on the above, our consolidated financial forecasts for the fiscal year ending May 15, 2021 are net sales of ¥860,000 million (up 2.3% year on year), operating income of ¥45,200 million (up 0.4%), ordinary income of ¥46,484 million (up 0.4%), and net income attributable to owners of the parent of ¥27,000 million (down 3.2%).
(5) Basic policy on distribution of profits and dividends
The Group's basic policy is focused on shareholder returns through the payment of stable dividends, while taking into account the need for funds to reinforce the operating base and support future business development. The Group plans to use the dividend payout ratio as a benchmark for the distribution of profits to shareholders.
In accordance with this policy, the Group pays an interim dividend and a year-end dividend, twice a year.
For the fiscal year under review, the Company paid an interim dividend of ¥74.00 per share, in line with its dividend forecast. The Company has decided to pay a year-end dividend of ¥93 per share, an increase of ¥19 from its original forecast of ¥74.00, in light of business results. As a result, the full-year dividend is ¥167 per share. For the fiscal year ending May 15, 2021, the Company plans to pay a full-year dividend of ¥167 per share.
For the fiscal year ending May 15, 2021, the Group plans to pay an interim dividend and a year-end dividend for shareholders of record on the final days of those fiscal periods.
The Group intends to use retained earnings for investments to boost corporate value, such as capital investment to open new stores and expand and refurbish existing stores, and to fund M&A deals and other initiatives that support growth.
2. Basic stance on selection of accounting standards
The Group will gather information and examine the possibility of adopting IFRS in future.
Attachments
- Original document
- Permalink
Disclaimer
TSURUHA Holdings Inc. published this content on 22 June 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 03 July 2020 02:33:09 UTC