Q2 FY1/2022 Financial Results

August 27, 2021
Stock Code：7590
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01

PERFORMANCE STATUS

2

01 FINANCIAL RESULTS for Q2(Million yen)

Q2 FY1/22 Performance Highlights

42nd fiscal period
Jul-2021

Ordinary income

1,227 million yen YoY : 162.7%

YoYNet sales

11,2709,706

116.1%

Gross profit

5,049

4,345

116.2%

SG&A

3,885

3,528

110.1%

Operating income

1,163816

142.5%

Ordinary income

1,227754

162.7%

865

535

161.5%

Operating income

1,163 million yen YoY : 142.5%

41st fiscal period
Jul-2020

Net income attributableto owners of parent

Upward revision of full-year earnings forecast

Net income

865 million yen(Million yen)YoY :161.5%

42nd fiscal
periodJan-2022

42nd fiscal
periodJan-2022（Revised）

41st fiscal
periodJan-2021

YoY（Initial）

InitialForecasts
Vs. Plan[Change]

Net sales

20,35019,680103.4%

18,486110.1%

Operatingincome

1,506

1,195

126.0%

1,156

130.3%

Ordinary income

1,452

1,190

122.0%

1,152

126.0%Net income
attributable toowners of parent

1,100

900

122.2%

952

115.5%

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01 FINANCIAL RESULTS for Q2Net Sales● PRO use business・Strengthen sales promotion activities through DX
・Expansion of production plants and showrooms
・Due to the effect of the market launch of new
spatial package type products YoY : 109％

11,270 million yen
YoY : 116.1％
42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

Japan

8,795

8,322

105.7%

Europe739467

158.1%

China

844

508

166.1%

United States

637

249

255.1%

253

158

159.8%

11,2709,706

116.1%(Million yen)

Others（Australia, South
Korea, India）

TotalYoY● HOME use business / International business・Full-scale operation of the second plant in Jiujiang,
promotion of global expansion
・Due to sustained demand for gardening both
domestic and overseas,
Domestic sales YoY : 108%
Overseas sales YoY : 181%

4

01 FINANCIAL RESULTS for Q2≪Sales composition ratio by segment≫

Sales segment status
42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

PRO use

6,273

5,732

109.4%HOME use

3,280

3,028

108.3%

Internationalbusiness

1,709

939

181.8%

65

109.7%

11,2709,706

116.1%(Million yen)

OthersTotal

YoYInternationalInternational

9.7%

15.2%

HOMEuseJul-2031.2%

PROuse59.1%HOME
useJul-21

29.1%PROuse
55.7%≫ Sustained demand for gardening, increase in sales at physical stores in some regions≪Sales by sales channel(HOME use)≫● HOME use business (Total)● HOME use (Domestic)●HOME use (Overseas)

HC： 128.5% YoY
EC： 117.0% YoY

HC： 111.7% YoY
EC： 92.8% YoY

HC： 234.3% YoY
EC： 151.8% YoY
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01 FINANCIAL RESULTS for Q2

Changes in market and distribution due to COVID-19 （HOME use business）■ Domestic market■ Overseas market

・ Significant increase of 165% compared to two years ago due to thelast year's reactionary fall in sales at Aoyama Garden （Eco-point
system for housing）

・ Substantial increase owing to recovery in sales at physical storesas a result of easing of restraint in operation at home centers
・ Sales increased due to growth in TV shopping and e-commerce・ Sustained demand for gardening reflecting the lifestyle changes

・ As gardeners increased, a "new way of living in the garden" is well-・ Further increase in sales by expanding new product lineups tomainstay products

accepted via social media promotion● YoY sales in home center, e-commerce, catalog sales● YoY sales in overseas sales(Million yen)

42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

YoY(Million yen)

42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

YoY

Home center

2,421

2,166

111.7%

Home center

807

344

234.3%

E-commerce +Catalog sales

600

647

92.8%

E-commerce +Catalog sales

684

450

151.8%

△3.1p

Sales
composition of
E-commerce /Catalog

45.9%

56.6%

△10.7pSales
composition of
E-commerce /Catalog

18.3%

21.4%

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01 FINANCIAL RESULTS for Q2Profit & Loss status
Gross profit margin :44.8% Improved by 0.1ppt. YoY● Rising costs due to soaring raw materials and ocean
freight rates
・Improved productivity of manufacturing subsidiaries
・Increase in the ratio of in-house products●Proportion of in-house manufactured products(consolidated)
70%
72%
Up by 2ppt.
●E-commerce ratio in the HOME use business(domestic + overseas)
28%
27%
Down by 1ppt.

Remained at the same level as the previous year
42nd fiscal period

41st fiscal period

Jul-2021

Jul-2020

Gross profit

5,049

4,345

116.2%Operating income

1,163816

142.5%

Ordinary income

1,227754

162.7%

865

535

161.5%(Million yen)

Net income attributable toowners of parent

YoY7

01 FINANCIAL RESULTS for Q2

Profit & Loss status : SG&A Analysis
SG&A :

34.5%

Improved by

1.9ppt YoY

42nd fiscal period

41st fiscal period

Jul-2021

Jul-2020

1,520

1,437

105.8%

Shipping cost

733

609

120.3%

Sales promotion andadvertising expenses

319

314

101.7%

Commissions paid

328

292

112.3%

Depreciation andamortization

199

179

111.4%

3,885

3,528

110.1%(Million yen)

Personnel expenses

Total

YoY

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01

FINANCIAL RESULTS for Q2

Balance sheet status
42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

Current assets

13,56912,687882● Increase in trade receivables:
705 million yen

Fixed assets

7,628

7,489

138

● Establishment of showroom
and factory: 217 million yen

21,19820,1771,020(Million yen)

Total assets

ChangeMain change factors

10,088

9,595

492● Increase in notes and accounts
payable-trade due to sales
increase: 1,287 million yen

684

1,561

△876

● Repayment of emergency fund:1,000 million yen

Net assets

10,425

9,020

1,404

● Increase in retained earnings:
990 million yen

Total liabilities andnet assets

21,19820,177

1,020

Current liabilities

Fixed liabilities

901

FINANCIAL RESULTS for Q2

Balance sheet status: Interest-bearing debt analysis

1 billion yen ⇒ Full repayment Down by 1,688 million yen YoY● Interest-bearing debt ratio at the end of the current fiscal year: 38.0%, 53.8% at the end of the previous fiscal year
● Emergency fund for COVID-19:

42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

Change42nd fiscal period(Forecast)Jan-2022

Working capital

3,872

5,574

△1,702

3,738

Equipment fund16510461147

Investments andacquisitions

2472

△48

34,063

5,751△1,688

3,888(Million yen)

Total

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01

FINANCIAL RESULTS for Q2

Cash flow status● Operating cash flows● Investing cash flows● Financing cash flows

・Increase in income before income
taxes and minority interests:

・Increase in payments for acquisitionof tangible fixed assets:

・Decrease due to repayment oflong-term loans:

1,223 million yen

208 million yen

1,118 million yen

42nd fiscal period
Jul-2021

41st fiscal period
Jul-2020

Cash flows from operating
activities

1,292

1,018

274

Cash flows from investing
activities

△279

△210

69

Free cash flows

1,013

807

206

Cash flows from financing
activities△1,402

411△991

Cash and cash equivalents
Balance at the end of thequarter

3,638

3,971

△332(Million yen)

Change11

01

FINANCIAL RESULTS for Q2

Major management indicators status
42nd fiscal period

41st fiscal period

Jul-2021

ROA（％）

Jul-2020

Change42nd fiscal period
Forecast at end of period

5.6

4.1

＋1.5p

7.6

ROE（％）

9.0

6.1＋2.9p

11.2

Shareholders’ equity ratio（％）

48.70

44.30

＋4.4p

51.20

Net assets per share（Yen）

708.12612.82＋95.30 yen

716.20Net income per share
（Yen）

59.34

36.74

＋22.66 yen

75.45

41st fiscal period

42nd fiscal period

Jul-2020

Jul-2021

August 26, 2021

Stock price

492 yen

876 yen991 yenPER

11.93 times

11.61 times

13.13 times● PER of TAKASHO stock

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01 FINANCIAL RESULTS for Q2

FY1/22 Short-term Plan

Upwardly revised plan at theend of the current fiscal year

41st fiscal period
Jan-2020

Ratio to sales

42nd fiscal period
Jan-2021

Ratio to sales

YoY

Net sales

18,486100.0%

20,350100.0%

110.1%

Gross profit

8,259

44.7%

9,100

44.7%

110.2%

SG&A

7,103

38.4%

7,594

37.3%

106.9%

Operating income

1,156

6.3%

1,506

7.4%

130.2%

Ordinary income

1,152

6.2%

1,452

7.1%

126.0%Net income
attributable to ownersof parent

952

5.2%

1,100

5.4%

115.4%(Million yen)

EPS（Yen）

65.36

75.45

Dividend per share（Yen）

20.00

23.00

Dividend payout
ratio: 30%* Net income for FY1/21 includes 66 million yen in extraordinary gains and losses (74 million yen in gain on reversal of foreign currency translation adjustment / 13 million yen in loss
on valuation and impairment of securities).
Net income after deduction of extraordinary gains and losses will be 846 million yen, which is 130.0% of actual YoY.

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02

BUSINESS DEPLOYMENT

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02 BUSINESS DEPLOYMENT

Established

August 1980

Listing market

Tokyo Stock Exchange 1st Section

Capital1,820,860,000 yen

No. of employees 760 in the whole Group
Group companies Japan: 5, overseas: 12
Our group proposes
total garden style

PRO garden exterior field
Proposals for detached houses (new construction, renovation) and house builders

Contract field
Proposals for non-residential buildings such as public works and commercial facilities

Home center, GMS field
Proposalsfor home centers and specialty stores
ホームセンター、専門店向け提案

E-commerce
Develop online sales from the website

International
Overseas expansion of PRO use and HOME use businesses15

02 BUSINESS DEPLOYMENT

我々はガーデンのライフスタイルメーカーとして

We create comfortableand pleasant family
幸せな家族のくらしとlifestyles with healthy garden spaces
笑顔で健康的な空間をつくります

We aim to be a global, one-of-a-kind company that
constantly creates new value, and contributes to theculture of urban environments and gardens.

We are a company that provides a better garden life
globally.

Industrialization and modernization of gardens and exteriors.
Creating a pleasant and healthy life in mentally andphysically.

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02 BUSINESS DEPLOYMENT
Listed on the First Section of theTokyo Stock Exchange

2021 8
Launch of SOLO CABIN

2021 4
GLD–LAB. Soft-Factory TOTTORI
Established in Tottori Prefecture
Established Hong KongGao Shu Group Limitedin Kowloon, Hong Kong(consolidated subsidiary)

Acquired shares of 3andgarden Inc. and made it a
70% subsidiary17

02 BUSINESS DEPLOYMENTBusiness Deployment
In-house product factory, in-house software plant, in-house commerce, planning company, construction and maintenance

Toward hybrid growth management
Manufacturing &creating space

SoftwareHumangrowth

Share
ITStrategy

Global strategy

Marketgrowth

Manufacturing Factory

Software Factory

Products and services (hardware)

Spatial package (software)

02 BUSINESS DEPLOYMENTDevelopment of ＤＸ（Digital Transformation）

Metaver GardenPackage plan

Packageplan

TAKASHO
Cloud-Linked Partnering Apps

Metaverse
GardenContents
Free app that allows
you to easily create
construction images
with AR and CG
synthesis functions

MR glasses
Experience a digital showroom where you
can propose products and spaces!
MR glasses

In addition to the conventional AR
simulation function, CG synthesis
function is added to photos and image
perspective

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02 BUSINESS DEPLOYMENTThe Industry's First XR Experience App “Metaver Garden for MR glasses”
TAKASHO and KDDI to collaborate on promoting DX in the 5G era!
Promoting digital showrooms using smart glasses
Delivery from late September 2021 (scheduled)
Metaver Garden for MR glasses

MR glasses

5G compatibledevices● Propose products even if you don't have your own showroom orexhibition space● A more concrete image of the construction space aftercompletion● A realistic experience in a space of your choice● Reduce waste and costs during renovation →Environmental protection20

02 BUSINESS DEPLOYMENT

Proposal for packages

You can download detailed plan on the web

Search for your favorite construction
cases and plans on the website

Narrow search by
location/price/size/style, etc.

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※ * Source:「2018年住宅・土地統計調査」より
2018 Housing and Land Survey

02 BUSINESS DEPLOYMENTHouseGardenTotal number of houses:

53,660,000 units*
Vacant house: 8,760,000 units*
Large potential demand

Propose a garden package deals

1% of the total number of houses × garden (0.3 million yen)
→ Market of about

160 billion yen

Changes in the way of people living due to COVID-19→ making people seek a more ideal, rich, fun,and comfortable life. Demand expanding in the DIY lifestyle market.
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02 BUSINESS DEPLOYMENTLifestyle space proposals

Rentalspace
Remotework
HobbyroomRelaxing
space

SOLO CABINFor Contracts

Garden house

For general housing

Porch

02 BUSINESS DEPLOYMENTSOLO CABIN example for contract ～Karuizawa Hoshino area～
The "Office through the Trees" workspace is surroundedby greenery

The "Hidamari Cafe," a private space for relaxation

02 BUSINESS DEPLOYMENTCharacteristics of HOME use business
Development of own
brand

PBs of leading home centers in Japan andoverseas

Style BusinessDirectly deployed from China's own plants
In-house [HOME use G&EX specialist plant] Site area of 82 thousand m2

Previous plant
66 thousand m2
STEEL

WOOD

PLASTICLED SOLAR LIGHT

New plant
16 thousand m2
ALUMINIUM

SEWING25

02 BUSINESS DEPLOYMENT

Initiatives of HOME use business Proposing a lifestyle that matches your hobbies and interests
DIY exterior

Vegetable and flower garden

Living garden / Seasonable garden
Total sales
volume:over 50,000units

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02 BUSINESS DEPLOYMENT

Overseas Market Development

E-commerce expansion strategy

Growth in overseas sales : 181% Jan-Jun vs. last year（Issues） Container shortage, soaring ocean freight rates（Measures） Respond to some price increases, consider lowering
freight rates by using marine transportation for customers
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02 BUSINESS DEPLOYMENT

Value provided by the TAKASHO
Changes in life styles under the post-COVID era
Health (Garden Therapy), Culture (emotion, art), Environment (greenery, natural, SDGs)

Flower

Green

With a garden lifestyle that creates
customized wealth and happiness for eachpeople

GardenIT

Lifestyle

Make a country with highlevel of happinessIn more happy countries28

02 BUSINESS DEPLOYMENTWorld Happiness Report

In addition to surveys that gauge each country's citizens' perception of how happy they
are, these measures are based on factors such as GDP, life expectancy, generosity,social support, freedom, and corruption.

Consumer awareness shifts from physical quantity to happiness and health

Designing ahouse andgarden at theTo the health industry

same time

Even in the world’s 3rd largest GDP

Japan ranked 58th in the World Happiness Report29

03

MEDIUM-TERM MANAGEMENT PLAN

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03 MEDIUM-TERM MANAGEMENT PLAN

Business Strategy
No.1 in growing exterior products and gardens

From Only 1 to No.1 G&EX Comprehensive Manufacturer

Domestic

GlobalContract

Life StylePRO
Package plan

Style

Customization

TAKASHO
Metaver GardenContents

DIY
Market development

Free app that allows
you to easily create
construction images
with AR and CG
synthesis functions

MR glasses

Production model03 MEDIUM-TERM MANAGEMENT PLAN

FY1/22 Plan/Medium-to-Long-term Plan
Net sales【Million yen】

Net sales
売上高100,000
80,00060,000Operating
営業利益
incomeOrdinary
経常利益
income100 billion yen Profit

Net
income純利益

・ Increasing inquiries for "garden space proposals" as new lifestyles take hold・ Gardening demand continues to be highPlans to update the mid-term plan by improving the supply system

12,00010,0008,000

50 billion yen

6,000
40,0004,000

20,0002,000

00
FY1/2021
2021年1月期(Million yen)

FY1/2022
2022年1月期

FY1/21Results

FY1/2024
2024年1月期

FY1/2023
2023年1月期

FY1/22Plan

FY1/2025
2025年1月期

FY1/23
Plan

FY1/2030
2030年1月期

FY1/24Plan

FY1/2050
2050年1月期

FY1/25Plan

Net sales

18,486

20,35021,70022,80024,700Operating income

1,156

1,506

1,560

1,660

2,110

Ordinary income

1,152

1,452

1,500

1,610

2,050

Net income

952

1,100

1,125

1,159

1,476

* Figures for FY1/21 include extraordinary gains and losses of 66 million yen. Net income after the deduction of extraordinary gains and losses is 886 million yen.

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04

SDGs

33

SDGs Initiatives
TAKASHO contributes to society with our sustainable development goals under the philosophy of "always
anticipating change, creating new value, and contributing to the creation of urban environmental and gardenculture".

Apr. 2016
Established the Japan Garden Therapy AssociationBy Nobuo Takaoka as Chairman

Garden therapy

Home therapyForest
therapy

Foodtherapy
Hearing

Extend healthy life
Gustation

VisionGardenPrevention of disease enhancing selfhealing capabilities
Stimulates the five senses andactivates the brain

Aroma
therapyOlfaction

TactileArt
therapy

Horticultural
therapy

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The purpose of this report is to provide information on the Company's financial results for thefiscal year ended January 2022, and not to solicit investments in the Company’s shares.
This material has been prepared based on data as of July 20, 2021.
Opinions, forecasts and other statements contained in this material are based on our judgment
at the time of preparation of the materials. We do not guarantee or promise the accuracy orcompleteness of the information, and they may be changed without notice in the future.
"Net income" in this document represents "Net income attributable to owners of parent."[IR Contact]
Atsushi Inoue, Corporate Officer, Corporate Management
Headquarters Vice Director
E-mail:soumubu@takasho.co.jp
TEL:073-486-2540

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