Summary of Financial Results
For the First Half of the Fiscal Year Ending December 31, 2021 (Consolidated)
These financial statements have been prepared in accordance with accounting principles and practices generally accepted in Japan. The following English translation is based on the original Japanese-language document.
July 30, 2021 | ||
POLA ORBIS HOLDINGS INC. | ||
Listing: | Tokyo Stock Exchange, First Section (Code No.: 4927) | |
URL: | https://www.po-holdings.co.jp/ | |
Representative: | Satoshi Suzuki, Representative Director And President | |
Contact: | Akira Fujii, Director, Finance | Tel: +81-3-3563-5517 |
Filing Date of Quarterly Securities Report: | August 12, 2021 | |
Start of Cash Dividend Payment: | September 10, 2021 | |
Supplemental Materials Prepared for Quarterly Financial Results: | Yes | |
Conference Presentation for Quarterly Financial Results: | Yes(for analysts) |
(Amounts less than one million yen have been truncated)
1. Consolidated Performance for the First Half of Fiscal 2021 (January 1, 2021-June30, 2021)
(1) Consolidated Operating Results
(Percentage figures indicate year-on-year change) | ||||||||
Net Sales | Operating Income | Ordinary Income | Profit Attributable to | |||||
Owners of Parent | ||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | |
FY2021 First Half | 89,055 | 6.3 | 9,095 | 54.7 | 10,477 | 130.6 | 7,086 | 673.3 |
FY2020 First Half | 83,802 | (24.0) | 5,881 | (63.8) | 4,543 | (70.8) | 916 | (90.8) |
Note: Comprehensive income: ¥6,549 million (670.0%) for the first half ended June 30, 2021; ¥850 million (-91.6%) for the first half ended June 30, 2020
Net Income | Diluted Net Income | |||
Per Share | Per Share | |||
Yen | Yen | |||
FY2021 First Half | 32.03 | 32.00 | ||
FY2020 First Half | 4.14 | 4.14 | ||
(2) Consolidated Financial Position | ||||
Total Assets | Net Assets | Equity Ratio | ||
Millions of yen | Millions of yen | |||
% | ||||
FY2021 Second Quarter | 205,664 | 173,110 | 84.0 | |
FY2020 | 203,742 | 169,854 | 83.2 |
Reference: Equity capital: FY2021 Second Quarter: ¥172,689 million; FY2020: ¥169,466 million
2. Dividends | Annual Cash Dividends Per Share | ||||
Q1-end | Q2-end | Q3-end | Year-end | Total | |
Yen | Yen | Yen | Yen | Yen | |
FY2020 | - | 35.00 | - | 15.00 | 50.00 |
FY2021 | - | 20.00 | |||
FY2021 (Forecast) | - | 31.00 | 51.00 |
Note1: Revisions to the cash dividends forecast announced most recently: none
Net Assets
Per Share
Yen
780.59
766.05
3. Consolidated Performance Forecast for Fiscal Year Ending December 31, 2021 (January 1, 2021-December31, 2021)
(Percentage figures indicate year-on-year change) | ||||||||||
Profit | Net Income | |||||||||
Net Sales | Operating Income | Ordinary Income | Attributable to | |||||||
Per Share | ||||||||||
Owners of Parent | ||||||||||
Millions of yen | % | Millions of yen | % | Millions of yen | % | Millions of yen | % | Yen | ||
Full year | 190,000 | 7.8 | 19,000 | 38.2 | 19,000 | 51.0 | 11,300 | 144.0 | 51.08 |
Note: Revisions to the consolidated performance forecast announced most recently: none
Notes to Summary Information
(1) Changes in significant subsidiaries during the current period | |
(Changes in specific subsidiaries resulting in changes in the scope of consolidation) | : None |
- Application of special accounting methods for the preparation of the quarterly consolidated: None financial statements
- Changes in accounting policies, accounting estimates, and restatement
1) | Changes in accounting policies associated with revision of accounting standards | : None |
2) | Changes other than (3)-1) | : None |
3) | Changes in accounting estimates | : None |
4) | Restatements | : None |
- Number of shares issued and outstanding (common stock)
- Number of shares issued and outstanding at the end of each period (including treasury stock)
At June 30, 2021 | 229,136,156 shares | |
At December 31, 2020 | 229,136,156 shares | |
2) | Number of shares of treasury stock at the end of each period | |
At June 30, 2021 | 7,907,561 shares | |
At December 31, 2020 | 7,915,453 shares | |
3) | Average number of shares issued and outstanding in each period | |
Six months ended June 30, 2021 | 221,224,712 shares | |
Six months ended June 30, 2020 | 221,219,903 shares |
Note: The number of shares of treasury stock at June 30, 2021 includes the Company's shares held by the officer compensation Board Incentive Plan (BIP) trust (244,708 shares).
Information Regarding Quarterly Review Procedures
The quarterly financial results report is exempt from quarterly review by certified public accountants or accounting firms.
Explanation of Appropriate Use of Performance Forecast and Other Special Items
This report contains projections of performance and other projections based on information currently available and certain assumptions judged to be reasonable. Actual performance may differ materially from these projections resulting from changes in the economic environment and other risks and uncertainties. For performance projections, please refer to "1. Qualitative Information on Consolidated Performance for the First Half of Fiscal 2021 (3) Explanation of Consolidated Performance Forecast and Other Predictive Information" on page 5.
POLA ORBIS HOLDINGS INC. (4927) FY2021 First Half Financial Summary | ||
Table of Contents | ||
1. Qualitative Information on Consolidated Performance for the First Half of Fiscal 2021……………… | 2 | |
(1) | Explanation of Consolidated Operating Results ………………………………………………………… | 2 |
(2) | Explanation of Consolidated Financial Position ………………………………………………………… | 4 |
(3) | Explanation of Consolidated Performance Forecast and Other Predictive Information ……………… | 5 |
2. Quarterly Consolidated Financial Statements ………………………………………………………………… | 6 | |
(1) | Consolidated Balance Sheets ……………………………………………………………………………… | 6 |
(2) | Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ……… | 8 |
(3) | Notes to Consolidated Financial Statements ……………………………………………………………… | 10 |
(Going concern Assumptions) ……………………………………………………………………………… | 10 | |
(Significant Changes in Shareholders' Equity) …………………………………………………………… | 10 | |
(Additional Information) …………………………………………………………………………………… | 10 | |
(Segment Information) ……………………………………………………………………………………… | 10 | |
(Business combination and other relationships)…………………………………………………………… | 11 | |
(Subsequent Events)………………………………………………………………………………………….. | 12 |
1
POLA ORBIS HOLDINGS INC. (4927) FY2021 First Half Financial Summary
1. Qualitative Information on Consolidated Performance for the First Half of Fiscal 2021
(1) Explanation of Consolidated Operating Results
During the first half of fiscal 2021 (January 1-June 30, 2021), the future outlook for a recovery in the Japanese economy and consumption remained uncertain due to stronger downward pressure on the economy resulting from the re-expansion of COVID-19 (the novel coronavirus), which led to a third declaration of a state of emergency in major cities, as well as an extension of the state of emergency along with an expansion of the target regions. While difficult circumstances have continued, especially for face-to-face services, which are closely linked to people's outings and flow, personal consumption has remained strong primarily due to sale of consumer products, backed by growing "nesting" demand. Since vaccination has started in earnest in various parts of Japan, it is expected that economic activities will normalize and consumption will recover along with the vaccine rollout. In the domestic cosmetics market, the mail order business including e-commerce has continued to perform strongly, despite an unavoidable decline in consumer sentiment due to a continued significant decrease in inbound demand, as well as government requests for citizens to refrain from going out, in addition to temporary store closures and shortening of operating hours. In the overseas cosmetics market, the future outlook still remains in a tough situation due to the global impact of the COVID-19 pandemic. In the Chinese market, which the Group has designated as a priority area, the economy gradually began to recover, as the number of new cases of COVID-19 continued to be contained. Since the full resumption of economic activities, personal consumption (retail net sales) has continued to exceed the level of the previous year.
Within this market environment, the POLA ORBIS Group (the "Group") has worked to achieve the key objectives-"evolving domestic direct sales," "growing overseas businesses profitably," "profit contribution from brands under development," "strengthening operations," and "expanding new brands and domains of 'beauty'." These objectives are in line with the new medium-term management plan (from 2021 to 2023) that started in fiscal 2021. As a result, the Group achieved the following consolidated operating results for the first half of fiscal 2021.
Consolidated net sales for the first half of fiscal 2021 increased 6.3% year on year to ¥89,055 million driven by the growth on the overseas of POLA as a flagship brand. Operating income increased 54.7% year on year to ¥9,095 million due to an increase in gross profit resulting from an improvement on cost of sales ratio. Ordinary income increased 130.6% year on year to ¥10,477 million due to the recording of foreign exchange gains due to yen depreciation. As a result of the factors noted above, profit attributable to owners of parent increased 673.3% year on year to ¥7,086 million.
Operating Results Overview | (Millions of yen) | |||
Six Months Ended June 30 | ||||
2020 | 2021 | Year-on-Year | ||
Amount Change | Percent Change (%) | |||
Net Sales | ¥83,802 | ¥89,055 | ¥5,253 | 6.3 |
Operating Income | 5,881 | 9,095 | 3,214 | 54.7 |
Ordinary Income | 4,543 | 10,477 | 5,933 | 130.6 |
Profit Attributable to | ¥916 | ¥7,086 | ¥6,170 | 673.3 |
Owners of Parent | ||||
2
POLA ORBIS HOLDINGS INC. (4927) FY2021 First Half Financial Summary | ||||
Operating Results by Segment | ||||
Net Sales (Segment Sales to External Customers) | (Millions of yen) | |||
Six Months Ended June 30 | ||||
2020 | 2021 | Year-on-Year | ||
Amount Change | Percent Change (%) | |||
Beauty Care | ¥81,401 | ¥86,819 | ¥5,417 | 6.7 |
Real Estate | 1,225 | 1,053 | (172) | (14.0) |
Others | 1,175 | 1,182 | 7 | 0.6 |
Total | ¥83,802 | ¥89,055 | ¥5,253 | 6.3 |
Segment Profit (Loss) (Operating Income (Loss)) | (Millions of yen) | |||
Six Months Ended June 30 | ||||
2020 | 2021 | Year-on-Year | ||
Amount Change | Percent Change (%) | |||
Beauty Care | ¥5,290 | ¥9,133 | ¥3,843 | 72.7 |
Real Estate | 503 | 186 | (316) | (62.9) |
Others | 14 | 27 | 12 | 83.6 |
Reconciliations of Segment | 72 | (252) | (324) | - |
Profit (Note) | ||||
Total | ¥5,881 | ¥9,095 | ¥3,214 | 54.7 |
Note: Reconciliations of segment profit refer to elimination of profits arising from inter-company transactions and expenses not allocated to reportable segments. Please see note 2 in "1. Information about Net Sales and Profit (Loss) by Reportable Segment" on page 10 and 11 for the details of reconciliations of segment income during the period.
Beauty Care
The Beauty Care segment consists of the flagship brands POLA and ORBIS, the overseas brands Jurlique and H2O PLUS, and the brands under development THREE, DECENCIA, Amplitude, ITRIM, FIVEISM × THREE, and FUJIMI.
POLA is seeking to further improve the value of its brand and establish its customer foundation over the medium to long term, through efforts to launch highly functional products focused on the field of anti-aging and skin- brightening, develop professional human resources who embody the value of the brand, and increase its contact points in the growth markets of China and travel retail. Since the beginning of fiscal 2021, Wrinkle Shot has been approved as a wrinkle-improvingquasi-drug. Also, renewed and improved major products, including a new skin- brightening serum, were launched in the White Shot series. POLA has also developed promotions for each customer segment and accelerated the use of online technology, with a focus on acquiring new customers and bringing back customers with few purchase records to increase the number of customers and maximize the annual life time value (LTV). Furthermore, POLA has made efforts to respond to changes in the environment by working on its e-commerce channel, which has continued to show strong performance. Overseas, POLA has steadily expanded its business mainly in China and in travel retail, which has largely driven the POLA brand as a whole. As a result, while COVID-19 continues to have an impact, POLA brand net sales and operating income rose year on year.
ORBIS is making efforts to enhance its presence through the creation of brand differentiation in order to re-grow into a highly profitable business. ORBIS is further strengthening its communications centered on products that embody the world view of the brand message, "Simply you. Simply beautiful." along with consistent marketing communication. In April, ORBIS launched the sunscreen Wrinkle White UV Protector, which improves wrinkles and brightens skin, in addition to expanding its skincare customer base with a focus on the ORBIS U anti-aging skincare series. ORBIS has also launched a subscription service aimed at improving its customer retention rate to improve LTV. Overseas, while ORBIS worked to improve its brand recognition rate by expanding customer contact points in Asia, due to the COVID-19 pandemic, a state near to lockdown has continued in Taiwan, which constitutes a high proportion of our overseas business. Similarly, in Japan, a decline in spending per customer due to a decrease in makeup product demand, as well as investment in new businesses, resulted in ORBIS brand net sales and operating income dropping below those of the corresponding period of the previous year.
For overseas brands, the Group took initiatives aimed at business growth in Australia and Asia for Jurlique and in the United States, where H2O PLUS originated. Following the spread of COVID-19, Jurlique was forced to suspend the operation of directly managed stores and major department stores in Australia. However, net sales rose year on
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POLA ORBIS Holdings Inc. published this content on 30 July 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 30 July 2021 06:08:11 UTC.