Descente : Presentation Material of the 66th annual General Meeting of Shareholders〔1,638KB〕

Management Policy for the Future

Disclaimer: This is an English translation of the original Japanese- language and is provided for reference purposes only. Readers are advised that the company does not guarantee the accuracy of the content contained in this report. In the event of any discrepancy between this translation and the Japanese original, the Japanese original shall prevail.

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Summary of FY2022 (2nd year of "D-Summit 2023")

１．Established a well-balanced profit structure in 3 markets (Japan/South Korea/China)

• Sales and profits were increased in Japan and South Korea, but profits were decreased in China due to COVID-19 and write-down of inventories associated with rebranding
• • Japan：Achieved ￥4.5B segment income because of the increased revenue and decreased sales losses
  • South Korea： Increased revenue because higher sales rate of full-price items and optimizing inventory levels
  • China：Investment and disposition for rebranding

２．¥10.5B consolidated net income was the best in our history

• Earning forecast for FY2023: Net income of ¥11.0B
• About 20% gain in net income forecasts compared with last year excluding non-recurring gain/loss

３．Increased dividends (¥40 / per share)

• ¥40 / per share are the best dividends in our history
• Dividend forecast for FY2023: ¥44 / per share

2

〇Improve profitability of Japan business

１．Focus on profit, not sales

◎Operating income ¥4.4B increase since FY2018 (Achieved ¥4.7B in FY2022)

(0.1

B ilon Yen)

Net sales and operating income of Japan business

600

519							503	500
		493
500
					443
					400
400
300
200
100
					24	47	50
3	▲ 13	▲ 24
0
FY2018	FY2019	FY2020		FY2021	FY2022	FY2023
-100
								Plan
NOTES: FY2022 = FY ended March, 2023			Net Sales (Product)		Operating Income		3

〇Improve profitability of Japan business

２．Control of production/inventory amount

	(Improvements since FY2018)
◎Inventory amount		３６% ↓
◎Return/discount rate	8 . 5 % ↓
	(0.1	Inventory amount and return/discount rate of Japan business
	B ilon Yen)
	120											20.0%
		110
	104			101						18.0%
	100
										16.0%
	80							77		14.0%
									67	70
Inventory										12.0%
	60											10.0%
amount											8.0%
40
										6.0%
	20										4.0%
										2.0%
	0											0.0%
		FY2018	FY2019	FY2020			FY2021	FY2022	FY2023
											Plan
					Inventory Amount			Return/Discount Rate

Return/discount rate

NOTES: FY2022 = FY ended March, 2023

4

〇Improve profitability of Japan business

３．Control of expenses (FY2021⇒FY2022)

◎Total expense	４％↑ Change from cost reduction to aggressive investment
・Advertising	２３％↑ Resumed investments to strengthen branding
・Logistics	６％↓	Reduced returned items and improved
		packaging consolidation
・Personnel	７％↓	Personnel reduction

Advertising, logistics, personnel fee of Japan business

FY2018		FY2021				FY2022
		Personnel fee		Logistics fee		Advertising fee		Other

NOTES: FY2022 = FY ended March, 2023

FY2021⇒FY2022

Total expense：

4%↑

Advertising fee：

23%↑

Logistics fee：

6%↓

Personnel fee：

7%↓

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