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MarketScreener Homepage  >  Equities  >  Tokyo Stock Exchange  >  Hakuhodo DY Holdings Inc    2433   JP3766550002

HAKUHODO DY HOLDINGS INC

(2433)
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HAKUHODO DY INCORPORATED : Consolidated Financial Summary for FY2016

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05/12/2017 | 02:45am EDT

May 12, 2017

Company Name: Hakuhodo DY Holdings Inc. Representative: Mr. Hirokazu Toda, President & CEO (Code number: 2433; TSE First Section)

Inquiries: Mr. Satoru Yagi Executive Manager, Investor Relations Division

(Tel: +81-3-6441-9033)

Consolidated Financial Highlights for Total of FY2016

Hakuhodo DY Holdings Inc. has summarized key data from its earnings report for fiscal 2016, the year ended March 31, 2017, released today, in the following reference materials.

1. Summary of Consolidated Income Statements (April 1, 2016 to March 31, 2017)

(Millions of yen)

FY2015

(Result)

FY2016

(Result)

YoY Comparison

Change

(%)

Billings

1,215,250

1,255,474

40,224

3.3%

Revenue

232,498

248,640

16,141

6.9%

(Gross margin)

(19.1%)

(19.8%)

(+0.7%)

SG&A expenses

187,503

201,379

13,875

7.4%

Operating income

44,994

47,261

2,266

5.0%

(Operating margin)*

(19.4%)

(19.0%)

(-0.3%)

Non-operating items

2,500

(1,769)

(4,270)

Ordinary income

47,495

45,491

(2,004)

-4.2%

Extraordinary items

(1,243)

(531)

712

Income before income taxes and minority interests

46,251

44,959

(1,292)

-2.8%

Profit attributable to owners of parent

28,531

25,880

(2,651)

-9.3%

* Operating margin = Operating income / Revenue

Dividend per share

¥18.0

¥24.0

¥6.0

During fiscal 2016 (April 1, 2016 to March 31, 2017), the Japanese economy continued to suffer powerful stagnation, with the Kumamoto earthquakes, Brexit, and yen appreciation hitting one after another. However, since the election of the new president of the United States, expectations for a growing United States economy have been on the rise, leading to the dollar appreciating against the yen, increased profits for Japanese companies, rising stock market prices, and improvements in consumer confidence. These are part of a trend toward a recovering economy. The domestic advertising market*1 continued to hold steady from the first through the third quarter, with the total growth for the 11 months leading up to February coming to roughly 2% year on year, showing steady market growth.

Against this backdrop, the Hakuhodo DY Group continued its proactive business development under the Medium-Term Business Plan covering the period through March 2019. As a result, billings for fiscal 2016 rose 3.3% from fiscal 2015, to 1,255,474 million.

By service area, television experienced a downturn after a strong performance in the previous year. Newspapers, Magazines, and Radio also performed sluggishly, leading to a year-on-year decrease in

billings. On the other hand, billings for other than mass media services rose year on year, with Internet media and Creative performing well.

By client industry, billings showed growth in a wide range of industries led by Information / Communications, Cosmetics / Toiletries, and Household products, while declines were recorded in Automobiles / Related products, Pharmaceuticals / Medical supplies, and Restaurant / Services.*2

Revenue grew 16,141 million, or 6.9%, to 248,640 million, bolstered by the successful expansion of existing businesses and the addition of new subsidiaries. Selling, general and administrative (SG&A) expenses rose 7.4% due to mergers and acquisitions for strengthening the organization and other strategic investments. As a result, operating income rose 5.0%, to 47,261 million. On the other hand, ordinary income decreased 4.2%, to 45,491 million, due to equity in losses of affiliates in non-operating items.

With the additional recording of 1,412 million of extraordinary gains and 1,944 million of extraordinary losses, income before income taxes and minority interests fell 2.8%, to 44,959 million, and profit attributable to owners of parent fell 9.3%, to 25,880 million.

Notes

  1. According to the Survey of Selected Service Industries (Ministry of Economy, Trade and Industry, Japan).

  2. Based on internal management categories and data compiled by the Company.

  1. Consolidated Balance Sheets as of March 31, 2017

    (Millions of yen)

    31-Mar-16

    31-Mar-17

    Comparison with March 31, 2016

    Amount

    Share

    Amount

    Share

    Change

    (%)

    Current assets

    498,308

    73.4%

    516,183

    71.5%

    17,874

    3.6%

    Fixed assets

    180,224

    26.6%

    205,868

    28.5%

    25,644

    14.2%

    Total assets

    678,532

    100.0%

    722,051

    100.0%

    43,518

    6.4%

    Current liabilities

    352,961

    52.0%

    359,503

    49.8%

    6,541

    1.9%

    Non-current liabilities

    31,539

    4.7%

    36,729

    5.1%

    5,190

    16.5%

    Total liabilities

    384,501

    56.7%

    396,233

    54.9%

    11,731

    3.1%

    Total shareholders' equity

    245,637

    36.2%

    262,922

    36.4%

    17,284

    7.0%

    Accumulated other comprehensive income

    27,520

    4.0%

    41,784

    5.8%

    14,263

    51.8%

    Subscription rights to shares

    223

    0.0%

    283

    0.0%

    59

    26.6%

    Noncontrolling interest

    20,648

    3.1%

    20,828

    2.9%

    179

    0.9%

    Total net assets

    294,031

    43.3%

    325,818

    45.1%

    31,787

    10.8%

    Total liabilities and net assets

    678,532

    100.0%

    722,051

    100.0%

    43,518

    6.4%

  2. Consolidated Forecasts for Fiscal 2017 (April 1, 2017 to March 31, 2018)

For reference, the consolidated forecast for the fiscal year ending March 31, 2018 is as follows.

(Millions of yen)

1H

2H

Full-year

FY2017

(Forecasts)

Y o Y Comparisons

FY2017

(Forecasts)

Y o Y Comparisons

FY2017

(Forecasts)

Y o Y Comparisons

Change

(%)

Change

(%)

Change

(%)

Billings

605,000

31,451

5.5%

712,000

30,073

4.4%

1,317,000

61,525

4.9%

Revenue

121,300

8,569

7.6%

144,700

8,789

6.5%

266,000

17,359

7.0%

(Gross margin)

(20.0%)

(+0.4%)

(20.3%)

(+0.4%)

(20.2%)

(+0.4%)

Operating income

18,700

861

4.8%

30,800

1,377

4.7%

49,500

2,238

4.7%

Ordinary income

19,700

113

0.6%

31,300

5,394

20.8%

51,000

5,508

12.1%

Profit attributable to owners of parent

10,850

105

1.0%

16,550

1,414

9.3%

27,400

1,519

5.9%

(Operating margin)*

(15.4%)

(-0.4%)

(21.3%)

(-0.4%)

(18.6%)

(-0.4%)

* Operating margin = Operating income / Revenue

The above forecasts were formulated based on the following projections.

Macro environment: Domestic advertising market to grow roughly 2%

Despite factors such as geopolitical risks driving down the economy, the Japanese economy is likely to continue its gradual recovery. Against the backdrop of this trend, the domestic advertising market is expected to grow roughly 2% in fiscal 2017.

Growth in overseas advertising markets is expected to outpace that of the robust Japanese advertising market, particularly in Asia, an area vital to the Group.

Billings: 1,317.0 billion, up 4.9% year on year

The Group aims to achieve growth above the advertising market average by accelerating the three Growth Drivers outlined in the Medium-Term Business Plan and by expanding its market share.

Revenue: 266.0 billion, up 7.0% year on year

Gross margin: 20.2%, up 0.4 points year on year

We are aiming for gross margins in the 20% range by focusing on further improvement of high gross margin levels in Japan and overseas expansion centered on fee businesses.

Operating income: 49.5 billion, up 4.7% year on year

In terms of SG&A expenses, although we will strive to make expenditures more efficient, strategic investments in pursuit of the Medium-Term Business Plan and increases in amortization of goodwill related to mergers and acquisitions are expected, and due to investments in a "new working style," we see the rate of SG&A expense growth surpassing the rate of revenue growth. As a result, we are forecasting a 4.7% increase in operating income, to 49.5 billion.

Profit attributable to owners of parent: 27.4 billion, up 5.9% year on year

We are forecasting an improvement in non-operating items and a 5.9% increase in profit attributable to owners of parent, to 27.4billion.

Based on the Group's fundamental policy of paying a stable dividend, and comprehensively taking into account our business performance and future outlook, we intend to increase the ordinary dividend for the year ending March 31, 2018, by ¥2 per share from the ¥24 per share paid for the year ended March 31, 2017, for a full-year dividend of ¥26 per share.

(Note)

Forecasts in this press release are based on certain assumptions deemed to be reasonable by the Company at the time of announcement. Actual results may differ materially from these forecasts due to a variety of reasons.

Hakuhodo DY Holdings Inc. published this content on 12 May 2017 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 12 May 2017 06:44:16 UTC.

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Number of Analysts 10
Average target price 1 433,33 JPY
Last Close Price 1 231,00 JPY
Spread / Highest target 30,0%
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Managers
NameTitle
Hirokazu Toda Chairman & Chief Executive Officer
Kojiro Ishii Manager-Group Finance & Accounting
Yoshitaka Nakatani Director & Head-Group Information System
Kunihiko Sawada Representative Director & Vice President
Junji Narita Director
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