Consolidated Financial Results
for the Three Months Ended November 30, 2021
[Japanese GAAP]
January 7, 2022
Company name: CURVES HOLDINGS Co., Ltd.
Stock exchange listing: Tokyo Stock Exchange Section 1
Stock code: 7085
URL: https://www.curvesholdings.co.jp/
Representative: Takeshi Masumoto, Representative Director and President
Contact: Shinya Matsuda, Director and General Manager, Administration Division
Tel: +81-3-5418-9922
Scheduled date of filing quarterly securities report: January 12, 2022
Scheduled date of commencing dividend payments: ‒
Availability of supplementary briefing material on quarterly financial results: Available
Schedule of quarterly financial results briefing session: Not scheduled
(Amounts of less than one million yen are rounded down.)
1. Consolidated Financial Results for the Three Months Ended November 30, 2021 (September 1, 2021 to November 30, 2021)
(1) Consolidated Operating Results | (% indicates changes from the previous corresponding period.) | |||||||||||||||
Net sales | Operating profit | Ordinary profit | Profit attributable to | |||||||||||||
owners of parent | ||||||||||||||||
Three months ended | Million yen | % | Million yen | % | Million yen | % | Million yen | % | ||||||||
November 30, 2021 | 6,460 | 13.0 | 493 | ‒ | 536 | ‒ | 315 | ‒ | ||||||||
November 30, 2020 | 5,719 | (22.0) | (10) | ‒ | (103) | ‒ | (143) | ‒ | ||||||||
(Note) Comprehensive income: Three months ended November 30, 2021: 462 million yen [‒%] | ||||||||||||||||
Three months ended November 30, 2020: (363) million yen [‒%] | ||||||||||||||||
Earnings per share | Diluted earnings | |||||||||||||||
per share | ||||||||||||||||
Three months ended | Yen | Yen | ||||||||||||||
November 30, 2021 | 3.37 | ‒ | ||||||||||||||
November 30, 2020 | (1.53) | ‒ | ||||||||||||||
(2) Consolidated Financial Position | ||||||||||||||||
Total assets | Net assets | Equity ratio | ||||||||||||||
As of | Million yen | Million yen | % | |||||||||||||
November 30, 2021 | 34,877 | 9,156 | 26.3 | |||||||||||||
August 31, 2021 | 36,284 | 9,163 | 25.3 | |||||||||||||
(Reference) Equity: As of November 30, 2021: 9,156 million yen | ||||||||||||||||
As of August 31, 2021: 9,163 million yen | ||||||||||||||||
2. Dividends | ||||||||||||||||
Annual dividends | ||||||||||||||||
1st | 2nd | 3rd | Year-end | Total | ||||||||||||
quarter-endquarter-end | quarter-end | |||||||||||||||
Yen | Yen | Yen | Yen | Yen | ||||||||||||
Fiscal year ended August 31, 2021 | ‒ | 0.00 | ‒ | 5.00 | 5.00 | |||||||||||
Fiscal year ending August 31, 2022 | ‒ | |||||||||||||||
Fiscal year ending August 31, 2022 (Forecast) | 3.50 | ‒ | 3.50 | 7.00 | ||||||||||||
(Note) Revision to the forecast for dividends announced most recently: No
3. Consolidated Financial Results Forecast for the Fiscal Year Ending August 31, 2022 (September 1, 2021 to August 31, 2022)
(% indicates changes from the previous corresponding period.)
Net sales | Operating profit | Ordinary profit | Profit attributable to | Earnings per share | |||||
owners of parent | |||||||||
Million yen | % | Million yen | % | Million yen | % | Million yen | % | Yen | |
First half | 13,050 | 9.7 | 1,400 | 60.6 | 1,380 | 106.2 | 899 | 158.8 | 9.58 |
Full year | 26,550 | 7.6 | 2,500 | 54.1 | 2,450 | 42.7 | 1,598 | 41.5 | 17.03 |
(Note) Revision to the financial results forecast announced most recently: No
* Notes:
- Changes in significant subsidiaries during the three months ended November 30, 2021 (changes in specified subsidiaries resulting in changes in scope of consolidation): No
Newly added: ― (Name: | ) | Excluded: ― (Name: | ) |
- Accounting policies adopted specially for the preparation of quarterly consolidated financial statements: No
- Changes in accounting policies, changes in accounting estimates and restatements
- Changes in accounting policies due to the revision of accounting standards: Yes
- Changes in accounting policies other than 1) above: No
- Changes in accounting estimates: No
- Restatements: No
- Total number of issued shares (common shares)
- Total number of issued shares at the end of the period (including treasury shares):
November 30, 2021: 93,857,493 shares
August 31, 2021: 93,857,493 shares
-
Total number of treasury shares at the end of the period: November 30, 2021: 121 shares
August 31, 2021: 121 shares - Average number of shares during the period (cumulative from the beginning of the fiscal year): Three months ended November 30, 2021: 93,857,372 shares
Three months ended November 30, 2020: 93,857,372 shares
-
Total number of treasury shares at the end of the period: November 30, 2021: 121 shares
- This summary of the quarterly financial results is outside the scope of quarterly review by certified public accountants or audit firms.
- Explanation of the proper use of financial results forecast and other notes
(Note on forward-looking statements, etc.)
The financial results forecast and other forward-looking statements contained in this document are based on information currently available to the Company and certain assumptions deemed reasonable by the Company. Such forward-looking statements are not intended to represent a commitment on the part of the Company to achieve them. Actual results may vary significantly due to various factors. See "(3) Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information" in the section, "1. Qualitative Information on Quarterly Financial Results for the Period under Review," on page 4 of the attached material for the assumptions used in the financial results forecast and precautions for using the financial results forecast.
(How to obtain supplementary briefing material on the financial results)
The Company will post supplementary briefing material on the financial results for this quarter on TDnet and the Company's website (https://www.curvesholdings.co.jp/) on Tuesday, January 11, 2022.
Table of Contents | ||
1. Qualitative Information on Quarterly Financial Results for the Period under Review .................................... | 2 | |
(1) | Explanation of Operations Results ............................................................................................................... | 2 |
(2) | Explanation of Financial Position ................................................................................................................ | 3 |
(3) | Explanation of Consolidated Financial Results Forecast and Other Forward-looking Information ............ | 4 |
2. Quarterly Consolidated Financial Statements and Primary Notes ................................................................... | 6 | |
(1) | Quarterly Consolidated Balance Sheets ....................................................................................................... | 6 |
(2) | Quarterly Consolidated Statements of Income and Comprehensive Income ............................................... | 8 |
(3) | Notes to Quarterly Consolidated Financial Statements.............................................................................. | 10 |
(Notes on going concern assumption) ........................................................................................................ | 10 | |
(Notes in the case of significant changes in shareholders' equity) ............................................................. | 10 | |
(Changes in accounting policies)................................................................................................................ | 10 | |
(Additional information)............................................................................................................................. | 10 |
1
1. Qualitative Information on Quarterly Financial Results for the Period under Review
(1) Explanation of Operations Results
The Group (the Company and consolidated subsidiaries, hereinafter referred to as the "Group") has been striving to contribute to the extension of health life expectancy through its core business, Curves, a 30-minute fitness club for women. The Group has endeavored to enhance the satisfaction of its members and expand membership by strengthening customer services as "community-based health infrastructure" that contributes to solving social issues.
It is the Group's understanding that the market environment during and after the COVID-19 pandemic will change dramatically in the following two ways:
- Growth of the health market: The pandemic forced people to focus on their lives and health, and the trend toward taking care of their own health will gain momentum over the medium- to long-term, promoting substantial growth of the disease-prevention and health market.
- Growing demand for contactless services: Extending beyond the end of the COVID-19 pandemic, consumer sentiment, society and the economy will remain "scared" by COVID-19, and qualitative changes will occur, such as an increase in demand for non-contact services.
In this management environment, the Group aims to achieve a business recovery and establish business models in the new management environment by the end of December 2022. It is pursuing strategies positioning the fiscal year ending August 31, 2022 (from September 1, 2021, to August 31, 2022) as the fiscal year for ensuring that such goals are achieved.
The net increase in the number of members, the most important indicator of the Group's business recovery, was 54K from 693K as of the end of the previous fiscal year and totaled 748K (including online members).
In soliciting new members during the first three months of the fiscal year under review (from September 1 to November 30, 2021), the Group ran a free trial campaign, word-of-mouth marketing, which is one of its strengths, and a media mix of TV and online ads. In addition to the strong results of marketing that targets younger seniors (50 to 64 years old), which has been the Group's priority strategy since the previous fiscal year, membership of older seniors (65 years old and above) is beginning to recover thanks to the easing of pressure to stay at home in response to the increasing vaccination rates.
As a result, the increase in membership during the first three months of the fiscal year under review exceeded the pre-Covid-19 level and reached a quarterly record high.
The Group's efforts to take comprehensive measures to prevent COVID-19 infections and raise customer satisfaction by improving and maintaining service quality has enabled it to reduce the monthly rate of membership termination to a level below the pre-COVID-19 level.
The Group proceeded with the closure and merging of the clubs that have been severely affected by COVID- 19, and approximately 70% of the members of closed and merged clubs have moved to other clubs.
Accordingly, the number of Curves facilities (excluding Men's Curves) and membership in Japan as of November 30, 2021 were as follows.
2
Number of Curves facilities (excluding Men's Curves) and membership in Japan
As of August 31, | As of November 30, 2021 | ||||
Changes from end of | |||||
2021 | |||||
previous fiscal year | |||||
Number of facilities | 1,958 facilities | 1,953 facilities | A decrease of | (0.3)% | |
5 facilities | |||||
Of which, number of | 75 facilities | 75 facilities | ‒ | ‒ | |
corporate operated facilities | |||||
Number of franchisee | 1,883 facilities | 1,878 facilities | A decrease of | (0.3)% | |
facilities | 5 facilities | ||||
Membership | 693K | 748K | 54K | 7.8% | |
- Reference: Numbers before COVID-19
As of February 29, 2020
2,014 facilities
65 facilities
1,949 facilities
832K
(Notes) 1. In the first quarter of the fiscal year under review, the number of new club opening was 6 and the number of clubs closed and merged was 11.
2. Curves membership in Japan include the number of members of online fitness program, Ouchi de Curves (Curves at Home).
There were seven Men's Curves facilities for men.
In overseas business, the Group considers Europe where it acquired the franchiser operations in July 2019 to be its priority market. As of the end of the first three months of the fiscal year under review (September 30, 2021 (a two-month lag in the calculation of consolidated results due to difference in fiscal year end)), the number of Curves facilities in Europe (UK, Italy, Spain, and five other countries) stood at 154, all of which are franchise outlets and resumed operation.
Selling, general and administrative expenses decreased 182 million yen year on year, primarily due to the absence of financial support provided to franchisees subject to business suspension and a decrease in temporary expenses for the development of Ouchi de Curves (Curves at Home), an online fitness program, despite active spending for marketing.
As a result, net sales for the first three months of the fiscal year under review were 6,460 million yen (up 13.0% year on year), leading to operating profit of 493 million yen (an operating loss of 10 million yen in the same period of the previous fiscal year). Ordinary profit was 536 million yen (an ordinary loss of 103 million yen in the same period of the previous fiscal year) due to the generation of foreign exchange gains at Curves International, Inc., which did not have an impact on changes in cash. Profit attributable to owners of parent was 315 million yen (a loss attributable to owners of parent of 143 million yen in the same period of the previous fiscal year) mainly due to the posting of income taxes - current of 170 million yen.
Since the Group operates in a single business segment, the Curves business, the segment information is omitted.
-
Explanation of Financial Position (Assets)
Total assets as of November 30, 2021 decreased by 1,407 million yen, compared to the end of the previous fiscal year to 34,877 million yen (down 3.9% from the end of the previous fiscal year).
Current assets decreased by 1,194 million yen to 13,766 million yen (down 8.0% year on year). This was mainly due to a decrease of 1,688 million yen in cash and deposits.
Property, plant and equipment increased by 23 million yen to 529 million yen (up 4.7% year on year). Intangible assets decreased by 114 million yen to 20,013 million yen (down 0.6% year on year). This was
mainly due to decreases of 52 million yen in trademark right and 44 million yen in other intangible assets. Investments and other assets decreased by 122 million yen to 567 million yen (down 17.7% year on year). Total non-current assets decreased by 213 million yen to 21,110 million yen (down 1.0% year on year).
3
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Curves Holdings Co. Ltd. published this content on 14 January 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 14 January 2022 06:51:08 UTC.