Summary of Financial Results
For the Nine Months of the Fiscal Year Ending December 31, 2022 (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.
October 31, 2022 | ||
POLA ORBIS HOLDINGS INC. | ||
Listing: | Tokyo Stock Exchange, Prime Market (Code No.: 4927) | |
URL: | https://www.po-holdings.co.jp/ | |
Representative: | Satoshi Suzuki, Representative Director And President | |
Contact: | Naoki Kume, Director, Finance | Tel: +81-3-3563-5517 |
Filing Date of Quarterly Securities Report: | November 14, 2022 | |
Start of Cash Dividend Payment: | - | |
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 Nine Months of Fiscal 2022 (January 1, 2022-September30, 2022)
(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 | % | |
FY2022 Nine Months | 119,654 | (8.8) | 7,668 | (37.4) | 12,169 | (9.4) | 13,035 | 50.5 |
FY2021 Nine Months | 131,164 | 4.3 | 12,241 | 32.7 | 13,432 | 72.8 | 8,661 | 453.1 |
Note: Comprehensive income: ¥10,973 million (30.1%) for the nine months ended September 30, 2022; ¥8,437 million (471.5%) for the nine months ended September 30, 2021
Net Income | Diluted Net Income | ||||||||||
Per Share | Per Share | ||||||||||
Yen | Yen | ||||||||||
FY2022 Nine Months | 58.92 | 58.86 | |||||||||
FY2021 Nine Months | 39.15 | 39.11 | |||||||||
(2) Consolidated Financial Position | |||||||||||
Total Assets | Net Assets | Equity Ratio | Net Assets | ||||||||
Per Share | |||||||||||
Millions of yen | Millions of yen | % | Yen | ||||||||
FY2022 Third Quarter | 202,624 | 171,705 | 84.5 | 773.72 | |||||||
FY2021 | 208,039 | 173,267 | 83.1 | 781.11 | |||||||
Reference: Equity capital: | FY2022 Third Quarter: | ¥171,170 million; FY2021: ¥172,803 million | |||||||||
2. Dividends | |||||||||||
Annual Cash Dividends Per Share | |||||||||||
Q1-end | Q2-end | Q3-end | Year-end | Total | |||||||
Yen | Yen | Yen | Yen | Yen | |||||||
FY2021 | - | 20.00 | - | 31.00 | 51.00 | ||||||
FY2022 | - | 21.00 | - | ||||||||
FY2022 (Forecast) | 31.00 | 52.00 |
Note: Revisions to the cash dividends forecast announced most recently: none
3. Consolidated Performance Forecast for Fiscal Year Ending December 31, 2022 (January 1, 2022-December31, 2022)
(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 | 170,000 | (4.8) | 11,700 | (30.7) | 15,700 | (17.2) | 14,000 | 19.3 | 63.29 |
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 financial: None statements
- Changes in accounting policies, accounting estimates, and restatement
1) | Changes in accounting policies associated with revision of accounting standards | : Yes |
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 September 30, 2022 | 229,136,156 shares |
At December 31, 2021 | 229,136,156 shares |
2) Number of shares of treasury stock at the end of each period | |
At September 30, 2022 | 7,904,513 shares |
At December 31, 2021 | 7,906,761 shares |
3) Average number of shares issued and outstanding in each period
Nine months ended September 30, 2022 | 221,230,184 shares |
Nine months ended September 30, 2021 | 221,225,877 shares |
Note: The number of shares of treasury stock at September 30, 2022 includes the Company's shares held by the officer compensation Board Incentive Plan (BIP) trust (242,460 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 Nine Months of Fiscal 2022 (3) Explanation of Consolidated Performance Forecast and Other Predictive Information" on page 5.
POLA ORBIS HOLDINGS INC. (4927) FY2022 Nine Months Financial Summary | ||
Table of Contents | ||
1. Qualitative Information on Consolidated Performance for the Nine Months of Fiscal 2022……………… | 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 | |
(Changes in Accounting Policies)…………………………………………………………………………… | 10 | |
(Segment Information) …………………………………………………………………………………….... | 11 | |
(Subsequent Events) ………………………………………………………………………………………… | 12 |
1
POLA ORBIS HOLDINGS INC. (4927) FY2022 Nine Months Financial Summary
1.Qualitative Information on Consolidated Performance for the Nine Months of Fiscal 2022
(1) Explanation of Consolidated Operating Results
During the nine months of fiscal 2022 (January 1-September 30, 2022), as economic and social activities have moved toward normalization since the lifting of COVID-19 activity restrictions, the Japanese economy has been affected by a temporary reduction in footfalls due to the rising number of cases of COVID-19 during the seventh wave, soaring energy and raw material prices due to the disruption of the international community, and rising prices resulting mainly from the significantly weakened yen, but personal consumption has remained steady. The outlook continues to be highly uncertain as the economy faces downside risks other than the COVID-19 pandemic, which has yet to be contained. In the domestic cosmetics market, the mail-order market including e-commerce has continued to expand following the spread of COVID-19. The expansion of services that integrate face-to-face sales, which are highly affected by COVID-19 restrictions, with online sales is expected to remain an important strategy as we look toward the post-pandemic world. Economic growth in overseas markets was slow, and China, which the Group has designated as a priority market, has been affected by intermittent pandemic prevention measures, such as lockdowns, implemented as part of the zero-COVID policy. Economic conditions and personal consumption are expected to continue to be significantly affected by the number of cases of COVID-19 and the countermeasures. As with Japan, we believe that it will be important to prepare for the possibility of severe infection countermeasures.
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 medium-term management plan (from 2021 to 2023) that started in 2021. As a result, the Group achieved the following consolidated operating results for the nine months of fiscal 2022.
Consolidated net sales for the nine months of fiscal 2022 decreased 8.8% year on year to ¥119,654 million. Operating income decreased 37.4% year on year to ¥7,668 million as a result of a decrease in gross profit due to decreased sales, and ordinary income decreased 9.4% year on year to ¥12,169 million due to the recording of foreign exchange gains resulting from yen depreciation. As a result of the factors noted above, profit attributable to owners of parent increased 50.5% year on year to ¥13,035 million.
Operating Results Overview | (Millions of yen) | |||||
Nine Months Ended September 30 | ||||||
2021 | 2022 | Year-on-Year | ||||
Amount Change | Percent Change (%) | |||||
Net Sales | ¥131,164 | ¥119,654 | ¥(11,509) | (8.8) | ||
Operating Income | 12,241 | 7,668 | (4,572) | (37.4) | ||
Ordinary Income | 13,432 | 12,169 | (1,263) | (9.4) | ||
Profit | Attributable | to | ¥8,661 | ¥13,035 | ¥4,374 | 50.5 |
Owners of Parent | ||||||
2
POLA ORBIS HOLDINGS INC. (4927) FY2022 Nine Months Financial Summary | ||||
Operating Results by Segment | ||||
Net Sales (Segment Sales to External Customers) | (Millions of yen) | |||
Nine Months Ended September 30 | ||||
2021 | 2022 | Year-on-Year | ||
Amount Change | Percent Change (%) | |||
Beauty Care | ¥127,834 | ¥116,231 | ¥(11,603) | (9.1) |
Real Estate | 1,581 | 1,561 | (20) | (1.3) |
Others | 1,748 | 1,861 | 113 | 6.5 |
Total | ¥131,164 | ¥119,654 | ¥(11,509) | (8.8) |
Segment Profit (Loss) (Operating Income (Loss)) | (Millions of yen) | |||
Nine Months Ended September 30 | ||||
2021 | 2022 | Year-on-Year | ||
Amount Change | Percent Change (%) | |||
Beauty Care | ¥12,271 | ¥8,319 | ¥(3,951) | (32.2) |
Real Estate | 382 | 430 | 47 | 12.5 |
Others | 26 | 68 | 42 | 162.2 |
Reconciliations of Segment | (439) | (1,150) | (711) | 161.8 |
Profit (Note) | ||||
Total | ¥12,241 | ¥7,668 | ¥(4,572) | (37.4) |
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 11 and 12 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 brand Jurlique, 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 strengthen its business foundation through efforts to launch highly functional products mainly in the field of anti-aging and skin-brightening, and to focus on China, a priority market, and the growth market of travel retail. In the domestic business, sales growth was seen in the e- commerce channels as a result of efforts to acquire and retain customers seamlessly between real stores and online channels and to improve life time value. Although results are trending toward recovery, we have not been able to fully offset the impact of the decline in Beauty Director operation rate and in the number of customers in consignment sales channels (face-to-face sales) resulting from the COVID-19 pandemic. In the overseas business, in China, a priority market, POLA has focused on marketing with an emphasis on maintaining and improving brand loyalty over the medium to long term by strengthening its promotion efforts through mainly e-commerce platforms where we can control the brand, and improving customer life time value along with acquiring new customers. However, China's zero-COVID policy had a significant impact, and POLA brand net sales and operating income declined year on year.
ORBIS is proceeding with enhancing its presence through the creation of brand differentiation and acquiring skincare product users, with a focus on the ORBIS U anti-aging skincare series, which was renewed this year, to re- grow into a highly profitable business. In Japan, ORBIS continued to strengthen communication by customer segment to increase customer activation. This led to an increase in the purchasing activity rate of existing customers and the revitalization of dormant customers, but the number of customers and spending per customer fell. Overseas, in China, a priority market, ORBIS promoted its brand online through social selling and expanded the area in which the brand is sold offline, but continued to be affected by lockdowns. As a result of the above, overall ORBIS brand net sales and operating income dropped below those of the corresponding period of the previous year.
The Jurlique brand achieved double-digit growth mainly in the e-commerce channel, a growth area, in China, which is positioned as its priority market, despite the impact of intermittent lockdowns in various provinces that caused the closure of offline stores. In Australia, as well, operating results recovered for offline channels, which had been affected by lockdowns in the previous year, and net sales surpassed those of the previous year. On the cost front, although active efforts were made to reduce selling, general and administrative expenses, operating loss rose slightly due to the impact of the foreign exchange rate.
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POLA ORBIS Holdings Inc. published this content on 31 October 2022 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 31 October 2022 06:18:05 UTC.