Wholehearted Creation and

Sharing of Values Always Strive to

Go Beyond

World Co., Ltd.

Financial Results for the Fiscal Year

Ending March 31, 2023

May 2023

Copyright © 2023 WORLD CO . ,LTD . All Rights Reserved .

1

World Co., Ltd.

Financial Results for the Fiscal Year

Ended March 31, 2023

Table of Contents

Copyright © 2023 WORLD CO . ,LTD . All Rights Reserved .

I.

Financial Results Review

3

II.

Medium-Term Management Plan

16

III.

Reference

31

Disclaimer

The World Group's earnings forecast and numerical targets described in this document, other than those based on historical or objective facts, are future projections by the Company based on currently available information and are subject to risks and uncertainties. Actual results may differ significantly from earnings forecast and numerical targets due to a variety of factors, including economic environment and market trends surrounding the Group.

This document has been prepared to foster a more informed understanding of the Group, and should not be construed as a solicitation for investment. While the data has been compiled with due consideration, we shall not be held liable for any failures or damages that may arise in connection with this document due to errors contained herein, falsification of data by a third party, or any other reason whatsoever.

The Company has adopted the International Financial Reporting Standards (IFRS) accounting principles since the fiscal year ended March 31, 2013, and this document has been prepared in accordance with IFRS unless otherwise stated. Core operating profit is sales revenue minus cost of sales and SG&A expenses. For more information on business segments, refer to page 8. For abbreviations and other terminologies used in this document, refer to pages 34-35.

2

Ⅰ

Financial Results

Review

World Co., Ltd.

Financial Results for the Fiscal Year

Ended March 31, 2023

Copyright © 2023 WORLD CO . ,LTD . All Rights Reserved .

3

Financial Statements: Statement of Profit or Loss

  1. Core operating profit rose a sharp 2.5x YoY to ¥13.5 billion, reaching 108% of our forecast. It has expanded YoY for nine consecutive quarters, reflecting a turnaround from the negative impact of the COVID-19 pandemic.
  2. After the effects of structural reforms in 2H waned, we continued to ramp up cost controls. We launched a full-scale reward program for employees. Personnel expenses rose by ¥3.4 billion YoY due to lower subsidies and an increase in the provision for bonuses.
  3. Profit attributable to owners of parent rose 23.8x YoY to just below ¥5.7 billion, marking a sharp recovery and providing a source of funds for shareholder dividends. There is still significant room for improvement in areas such as temporary losses and financial expenses, and we will strive to increase profit attributable to owners of parent to the next level

over the medium term.

FY03/23

FY03/23

FY03/22

actual

forecast

Actual - forecast

actual

YoY

#

(Millions of yen)

% of total

% of total

Change

% change

% of total

Change

% change

1

Revenue

214,246

100

.0%

212,000

100.0%

2,246

101%

171,344

100.0%

42,901

125%

2

Gross profit

123,935

57

.8%

125,500

59.2%

(1,565)

99%

98,647

57.6%

25,288

126%

SG&A expenses

3

110,396

51

.5%

113,000

53.3%

(2,604)

98%

93,258

54.4%

17,139

118%

②

Core operating profit (loss)

①

4

13,539

6

.3%

12,500

5.9%

1,039

108%

5,389

3.1%

8,150

251%

5

Other income and

(1,853)

－

(1,600)

－

(253)

－

(3,193)

－

1,340

－

expenses, net

6

Operating profit (loss)

11,686

5

.5%

10,900

5.1%

786

107%

2,196

1.3%

9,490

532%

7

Finance income and

(1,373)

－

(1,300)

－

(73)

－

(786)

－

-587

－

costs, net

8

Profit (loss) before tax

10,313

4

.8%

9,600

4.5%

713

107%

1,410

0.8%

8,903

732%

9

Income taxes (a)

(4,627)

－

(4,100)

－

(527)

－

(1,170)

－

-3,457

－

③

10

Profit (loss) attributable to

5,686

2

.7%

5,500

2.6%

186

103%

239

0.1%

5,446

2,376%

owners of parent

  1. Includes income tax expense and non-controlling interests.

Note: Figures for FY03/21 have been adjusted to reflect the finalization of provisional accounting treatments for business combinations.

Copyright © 2023 WORLD CO.,LTD. All Rights Reserved.

4

Financial Statements: Addendum to the Statement of Profit or Loss (KPI Review)

We achieved our targets in the Brand business under the motto: "There is no revival of World without the revival of our apparel brands." The Digital business recorded earnings growth. Our next goal is to increase earnings in the Platform business driven by B2B external sales.

Trends in segment profit by business (quarterly)

Core operating profit (annual rolling average; billions of yen)

Achieved recovery in apparel brands as declared

Brandbusiness

98

91

93

101

115

103

COVID

outbreak

88

98

100

Japan* No sores.of in

(51)

62

of ¥

11.5

profit

73

31

3

On track to top

(23)

(28)

record high

(78)

(108)

billion

(110)

9

Swift turn to profit and on heading toward new record high,

9

salesgrowth

Same-store

Digital

7

7

first in B2B, subsequently in B2C

1

business

(4)

(2)

(6)

(6)

System investment (B2B) and entry

(10)

(13)

Swift turn to

into and investment in circular and

(16)

other businesses

(19)

(18)

profit, on track

(22)

(21)

Targeting returns on upfront

for record high

Gross

spending in B2B external sales

42

Platform

Tailwind from pandemic-

40

margin

induced demand

36

In addition to recording upfront

(medical gowns, etc.)

32

spending for B2B external sales,

25

foreign exchange had a negative

21

impact in FY03/23

20

17

20

18

business

14

13

10

12

12

9

4

3

1

Inventory

turnover

4 Q 2 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q

F Y 0 3 / 1 9

F Y 0 3 / 2 0

F Y 0 3 / 2 1

F Y 0 3 / 2 2

F Y 0 3 / 2 3

KPIs of the Brand business (1H, 2H)

Full year

1H

2H

No. of stores at beginning of year

2,361

2,313

2,361

No. of stores opened

30

32

62

No. of stores closed

STRASBURGO

(78)

(146)

(224)

Net increase/decrease

added at end-

(48)

(114)

(162)

FY03/23

Net increase/decrease due to

0

25

25

acquisitions

No. of stores at end of year

2,313

2,224

2,224

Department stores

Held strong

137.2%

116.5%

124.0%

Shopping centers

Accelerated

113.7%

115.3%

114.7%

Sundries stores

Slowed down

108.3%

99.4%

105.6%

Total

119.8%

112.6%

115.6%

Gross margin (FY03/22)

55.4%

59.3%

57.6%

Change in gross profit mix due to

+0.1pp

+0.4pp

+0.2pp

newly acquired companies

Impact of discounts on sales

+2.2pp

-0.9pp

+0.5pp

Impact of valuation/wear losses

+0.3pp

-0.6pp

-0.1pp

Change in gross profit mix due to

-0.8pp

+0.7pp

+0.9pp

increase in sales toother companies

Change in gross profit mix due to altered

+0.9pp

-0.8pp

-1.0pp

composition of sales channels

Consolidation effects for Narumiya

-0.2pp

-0.2pp

-0.3pp

YoY change Discounting and valuation losses

+2.4pp

-1.5pp

+0.3pp

worsened due to upfront purchasing

57.9%

57.8%

57.8%

Gross margin of autumn/winter season products

Inventory turnover (FY03/22)

Waning impact of

1.63X

1.74X

3.22X

Narumiya

YoY difference

-0.03X

+0.10X

+0.43X

consolidation paved

way for improvement

Inventory turnover (FY03/23)

1.59X

1.84X

3.65X

Notes: 1. Corporate profit and consolidation adjustments are not included.

2. Past figures have not been retroactively adjusted to reflect segment changes.

*Not including the number of franchise stores (94 stores, as of March 31, 2023)

Copyright © 2023 WORLD CO.,LTD. All Rights Reserved.

5

Attachments

  • Original Link
  • Original Document
  • Permalink

Disclaimer

World Co. Ltd. published this content on 08 May 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 05 June 2023 08:08:09 UTC.