Milbon Co., Ltd. · TSE:4919
Milbon — Q3 2023 Earnings Presentation
34 slides from Milbon's earnings presentation, Nov 10, 2023
Slide 1: FY2023 Third Quarter Financial Results Presentation Materials
Milbon Co., Ltd. FY2023 Third Quarter (January 1, 2023 – September 30, 2023) Financial Results Presentation Materials November 10, 2023 © 2023 Milbon Co., Ltd. 0
Slide 2: Table of Contents
Table of Contents P3 Consolidated Operating Results P4 Factors in YoY Changes in Consolidated Operating Income P5 Consolidated Sales by Product Category P17 Consolidated Trends in Capital Expenditures and R&D Expenses P18 Trends in Fieldpersons (FPs) P19 Consolidated Net Sales in Japan and Overseas
Slide 3: Financial Results for FY2023 Third Quarter
Milbon Group Financial Results for FY2023 (64 th Term) Third Quarter Masahiro Murai, Managing Executive Director © 2023 Milbon Co., Ltd. 2
Slide 4: Consolidated Operating Results (FY2023 9 months)
Consolidated Operating Results（FY2023 9 months） Sales grew thanks to the strong performance of haircare products both in Japan and overseas. Overseas, especially in the U.S. and South Korea, is driving growth. Profit decreased due to the persistent high cost of raw materials, the inventory write
Slide 5: Factors in YoY Changes in Consolidated Operating Income
Factors in YoY Changes in Consolidated Operating Income • The gross profit margin declined due to the persistent high cost of raw materials and the product mix effect of lower sales of hair coloring products. • A write-down of 900 million yen was recorded due to the lowering of the sales forecast fo
Slide 6: Consolidated Sales by Product Category: Hair Care Products (1)
Consolidated Sales by Product Category [Hair Care Products (1)] Consolidated Net Sales (FY2023 9 months) (Unit: million yen) Increase/ FY2022 FY2023 Increase/ Vs. plan ratio Decrease ratio 9 months 9 months Decrease (%) (%) 18,415 19,933 1,517 8.2 0.0 • Sales of Premium Brands rose 14.7% YoY. The st
Slide 7: Hair Care Products (2) New Products
Consolidated Sales by Product Category [Hair Care Products (2)] New Products FY 2023 9 months Aujua Hair Care Series Inmmetry Line A new line that corrects distortion*1 in the hair and frees from the habit of blow drying and ironing to condition hair, leading to lustrous and manageable hair with jus
Slide 8: Hair Care Products (3) New Products
Consolidated Sales by Product Category [Hair Care Products (3)] Miincurl Iron Keep Primer A pre-ironing primer oil that protects hair from the heat of the iron and keeps the ironed hair design soft and hydrated for a long time. (Unit: million yen) FY2023 FY2023 target Progress rate (%) 9 months 150
Slide 9: Premium Brand: Aujua
Premium Brand: Aujua New products “Inmmetry Line” led the growth in Japan. Number of Salons*1 (Unit: salons) Increase/ Increase/ FY2022 FY2023 Decrease Decrease ratio (%) 6,022 6,633 611 10.1 Consolidated Gross Sales (FY2023 9 months) (Unit: million yen) FY2022 FY2023 Increase/ Increase/ 9 months 9
Slide 10: Premium Brand: Global Milbon
Premium Brand: Global Milbon Increases in the number of touchpoints in Japan and overseas, particularly in the U.S., contributed to the increase in sales. Number of Salons*1 (Unit: salons) Increase/ Increase/ FY2022 FY2023 Decrease Decrease ratio (%) 18,400 21,919 3,519 19.1 Consolidated Gross Sales
Slide 11: Consolidated Sales by Product Category: Hair Coloring Products
Consolidated Sales by Product Category [Hair Coloring Products] Consolidated Net Sales (FY2023 9 months) (Unit: million yen) FY2022 FY2023 Increase/ Increase/ Vs. plan ratio 9 months 9 months Decrease Decrease ratio (%) (%) 12,333 12,431 97 0.8 (2.1) • Hair coloring products sales in Japan decreased
Slide 12: Premium Organic Brand: Villa Lodola (1)
Premium Organic Brand: Villa Lodola (1) Sales remained steady, especially for the mainstay product Villa Lodola Color. Number of Salons*1 (Unit: salons) Increase/ Increase/ FY2022 FY2023 Decrease Decrease ratio (%) 12,458 13,262 804 6.5 Consolidated Gross Sales (FY2023 9 months) (Unit: million yen)
Slide 13: Premium Organic Brand: Villa Lodola (2)
Premium Organic Brand: Villa Lodola (2) New Products FY 2023 9 months Villa Lodola Renovo Tempus / Fulgens A series that extends hair color longevity with the reparative effects of nature's blessings, promoting healthy beauty in both the scalp and hair. Two types of shampoos and treatments to choose
Slide 14: Consolidated Sales by Product Category: Cosmetic Products (1)
Consolidated Sales by Product Category [Cosmetic Products (1)] Consolidated Net Sales (FY2023 9 months) (Unit: million yen) Increase/ FY2022 FY2023 Increase/ Vs. plan ratio Decrease ratio 9 months 9 months Decrease (%) (%) 391 421 30 7.7 (1.8) • Imprea, the brand shipped directly to salons*1, saw an
Slide 15: Cosmetic Products (2) New Products
Consolidated Sales by Product Category [Cosmetic Products (2)] New Products FY 2023 9 months iMPREA Milky Soufflé UV An airy, soufflé-textured sunscreen cream that blocks powerful ultraviolet rays and protects the skin from damage caused by dryness and other factors to the stratum corneum. (Unit: mi
Slide 16: Premium Brand: iMPREA
Premium Brand: iMPREA Sales increased driven by new products, although existing products sales struggled. Number of Salons*1 (Unit: salons) Increase/ Increase/ FY2022 FY2023 Decrease Decrease ratio (%) 1,601 1,914 313 19.6 Consolidated Gross Sales (FY2023 9 months) (Unit: million yen) FY2022 FY2023
Slide 17: Consolidated Sales by Product Category: Other
Consolidated Sales by Product Category [Other] New Products FY 2023 9 months Elmista（Results for dryer unit only） A hair dryer, jointly developed with Panasonic, that micronizes and atomizes beauty serum. Five types of serums are available to choose from according to hair concerns and desired textur
Slide 18: Consolidated Trends in Capital Expenditures and R&D Expenses
Consolidated Trends in Capital Expenditures and R&D Expenses (Unit: million yen) FY2023 FY2023 Category FY2019 FY2020 FY2021 FY2022 9 months Plan Capital expenditures 1,605 1,917 4,644 4,097 2,112 2,927 Depreciation and amortization 1,453 1,562 1,777 2,026 1,635 2,301 Amount 1,534 1,581 1,741 2,074
Slide 19: Trends in Fieldpersons (FPs)
Trends in Fieldpersons (FPs) Fieldpersons Trends (by Country) (Average number of FPs during the period) The number of Fieldpersons reported FY2021 FY2022 FY2023 represents the average number during the period and is not as of January 1. Please JAPAN 328.2 335.4 350.5 note that the calculation method
Slide 20: Consolidated Net Sales in Japan and Overseas
Consolidated Net Sales in Japan and Overseas FY2023 9 months (Unit: million yen) Increase/ FY2022 FY2023 Changes in local Decrease Vs. plan ratio 9 months 9 months Increase/ currency base*1 ratio Decrease Net sales % to sales Net sales % to sales (%) (%) (%) Consolidated net sales 32,407 100.0 34,15
Slide 21: Consolidated Operating Income in Japan and Overseas
Consolidated Operating Income in Japan and Overseas FY2023 9 months (Unit: million yen) FY2022 FY2023 Increase/ Vs. plan ratio 9 months 9 months Increase/ Decrease ratio Operating Operating Decrease Operating Operating income income (%) (%) income income ratio(%) ratio(%) Consolidated operating inco
Slide 22: Outlook of Overseas Subsidiaries (1)
Outlook of Overseas Subsidiaries (1) USA (Milbon USA) • The 3Q sales of this year showed a significant increase, partly as a result of the recovery from the delayed sales to the 4Q caused by the shipment issues in the 3Q of the previous year. • Global Milbon haircare products, which make up 80% of t
Slide 23: Outlook of Overseas Subsidiaries (2)
Outlook of Overseas Subsidiaries (2) CHINA (Milbon China) • Salon customers are changing and demanding more reasonable and high-quality services from salons. The number of customers visiting salons and the unit price per service have been on a downward trend, and the Company has been affected by thi
Slide 24: Outlook of Overseas Subsidiaries (3)
Outlook of Overseas Subsidiaries (3) SOUTH KOREA (Milbon Korea) • As for hair coloring products, which account for more than 70% of total sales, gray color products remained steady due to the aging population. On the other hand, fashion color products are affected by changes in color trends. In orde
Slide 25: Revision to Consolidated Operating Results Forecast (1)
Revision to Consolidated Operating Results Forecast (1) The revision of the consolidated net sales forecast is due to the fact that the full-year sales forecast for “Elmista,” the hairdryer introduced in Japan has been reduced by 180 million yen, from 300 million yen to 120 million yen. In addit
Slide 26: Revision to Consolidated Operating Results Forecast (2)
Revision to Consolidated Operating Results Forecast (2) Factors Affecting Changes in Operating Income （Unit: million yen） Inventory write-down for Elmista: (904) 7,350 Others： (210) (236) (1,114) 6,000 Decrease in Revised target for gross profit Revised operating income due to lower Disposal and for
Slide 27: Factors Behind the Revised Forecast and Future Initiatives
Milbon Group Factors Behind the Revised Consolidated Operating Results Forecast and Future Initiatives Ryuji Sato, Representative Director, President and CEO © 2023 Milbon Co., Ltd. 26
Slide 28: Factors That Led the Hairdryer Business to Fall Short of the Goal
Factors That Led the Hairdryer Business to Fall Short of the Goal Sales of the hairdryer fall short of the target due to overly optimistic sales goals and inadequate pre-launch review of issues. Overly optimistic sales goals • Overconfidence in the distinctive product feature of “beauty serum Overco
Slide 29: Marketing Policy for Elmista During the Year
Marketing Policy for Elmista During the Year Based on the successful cases from July to September, we will implement initiatives to boost year-end sales with supportive salons and carry the momentum into the next year. Successful High level of customer satisfaction with the hair finish after cases f
Slide 30: Marketing Policy for Elmista for Next Years and Beyond
Marketing Policy for Elmista for Next Years and Beyond Using the results of the year-end sales campaign in 2023 as a foundation, we will launch new initiatives. Product Sales activity Awareness / experience • Launch two types of • Expand the distribution • Enhance product Airconcs from Elujuda of El
Slide 31: Significance of New Business Initiatives
Significance of New Business Initiatives We are working on new business initiatives in new product categories as the third growth strategy, alongside 'Hair Care' and 'Overseas,' aiming for sustainable growth. New Business Overseas Skincare, beauty healthcare, Haircare Promoting local production beau
Slide 32: Return to Shareholders
Return to Shareholders Dividend Forecast Year-end dividend is set at 48 yen, as originally planned. Total dividend for the year is expected to be 88 yen. FY2023 FY2021 FY2022 FY2023 Forecast （Unit: yen） End of 2Q 30 40 40 - End of FY 38 46 - 48 Total 68 86 - 88 Consolidated dividend 43.3% 50.2% - 67
Slide 33: Appendix: Hair Care Brand Positioning Map
<Appendix> Hair Care Brand Positioning Map Premium Brands Professional Brands © 2023 Milbon Co., Ltd. 32
Slide 34: Forward-looking statements
With respect to the business forecasts included in this document, any statement that is not historical fact is a forward-looking statement based on information available and certain premises that are judged to be rational at the time of the announcement. Please be aware that actual results may diffe