Financial Results for Year Ended March 31, 2020

May 28, 2020

JALUX Inc.
TSE #2729

IndexFinancial Results for Year Ended March 31, 2020

Impact of COVID-19 on JALUX Group
Consolidated Financial Summary

Performance per Operation Segment

Forecasts for the Fiscal Year Ending March 31, 2021
Review of Medium-Term Management Plan
Sustainable Growth of JALUX Group
-2-

… 3
… 5
… 10
… 17
… 22
… 29
Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Impact of COVID-19 on JALUX Group-3-

Copyright © JALUX Inc. All Rights Reserved.

1 Impact of COVID-19 on JALUX Group

Number of persons

January 2020

YoY rate

ResultYoY rate

3,613

106.9%

2,710

84.6%

1,209

31.8%

HND Airport users(Thousand)

6,567

Airport RetailManagement
Business

April 2020

Result2,661

Impact on

March 2020

YoY rate(Thousand)(Thousand)February 2020

ResultInbound

NRT Airport users

Financial Results for Year Ended March 31, 2020

98.9%
97.6%

1,085
5,677

Same-store sales
in March

Temporarily closed
stores as of the endof April

41.7%
87.5%

193

2,748

Reference

7.0%

35.2%

Result2

YoY rate

0.1%

Not yet announced
Not yet announced

Inbound: Japan National Tourism Organization
Airport users: East Japan Civil Aviation Bureau

BLUE SKY
38.7%

JAL DUTYFREE
25.9%

BLUE SKY
35 stores/all 75 stores

JAL DUTYFREE
9 stores/all 9 stores

Coronavirus effect on a wide range of business activities such as duty-free distribution, foodsales to department stores, hotels and restaurants, and so on.

Uncertain Outlook and a Long-Standing Crisis-4-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Consolidated Financial Summary-5-

Copyright © JALUX Inc. All Rights Reserved.

2 Consolidated P/L (Summary)Financial Results for Year Ended March 31, 2020

Consolidated P/L (Summary)

Net sales

Gross profit

SG&A expenses

Operating profit

Non-operating profit/expenses（Million yen）

March 2019

185,726
26,59021,961
4,628

466

Ordinary profit

5,094

Profit attributable to owners of parent

2,962

Extraordinary profit/losses

Gross profit to net sales ratio

Ordinary profit to net sales ratio

March 2020

144,688△41,038

21,870△91

25,840

△658

4,738

△356

3,081

+118

768

△182

14.3

17.9

-6-

△749

3,969

△98

2.7

YoY

3.3

YoY（%）

77.9%
97.2%
99.6%
85.8%

301

164.5%

△84

－

+3.5

93.0%

104.0%+0.5

Copyright © JALUX Inc. All Rights Reserved.

3 Consolidated B/S (Summary)Financial Results for Year Ended March 31, 2020

Consolidated B/S (Summary)Current assets

Cash and deposits（Million yen）

March 31, 2019

March 31, 2020

6,050

6,175

46,39848,765

YoY+2,366+124

YoY（%）

105.1%

102.1%

Non-current assets

10,48812,079+1,591115.2%

Intangible assets

490

673

+182

137.3%

Property plant and equipment

Investments and other assets

4,508

5,489

5,266
6,138

+758
+649

116.8%
111.8%

Total assets

56,88760,844+3,957107.0%

Non-current liabilities

1,507

1,093

△413

72.6%

Current liabilities
Net assets

Total liabilities and net assets

29,32826,051

56,887-7-

31,70428,046
60,844+2,376+1,995+3,957108.1%
107.7%

107.0%

Copyright © JALUX Inc. All Rights Reserved.

4 Financial Position

Financial Results for Year Ended March 31, 2020

Financial Position（Million yen）

March 31, 2019

March 31, 2020

YoY

YoY（%）

Total assets

56,88760,844+3,957107.0%

Shareholders’ equity

24,12826,337+2,209109.2%

42.4

43.3

+0.9

11,75014,329+2,579

0.48

0.54

+0.06

Shareholders’ equity ratio (%)
Interest bearing debt
Debt/Equity ratio (times)-8-

122.0%

Copyright © JALUX Inc. All Rights Reserved.

5 Consolidated Cash flow (Summary)Financial Results for Year Ended March 31, 2020

Consolidated Cash Flow

（Million yen）

March 2019

March 2020

YoY

Net cash from operating activities△4,463

1,488+5,951

Net cash from investing activities△706△2,744△2,038Net cash from financing activities

5,211

1,418

△3,792△5,169△1,255

3,913

Free cash flow

-9-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Performance per Operational Segment-10-

Copyright © JALUX Inc. All Rights Reserved.

6 Net Sales by Segment
Net Sales by Segment

Financial Results for Year Ended March 31, 2020

Note: Sales including inter-segment transaction

March 2019

March 2020

（Million yen）

YoY

YoY（%）

Aviation & Airport

84,444

48,819△35,625

57.8%

Life Service

13,654

13,095

△559

95.9%

Retail63,271

57,625△5,646

91.1%

Food & Beverage

25,67026,574+903

103.5%

Eliminations△1,315△1,426

Total

185,726

144,688△41,038

77.9%

-11-

Copyright © JALUX Inc. All Rights Reserved.

7 Sales Composition Ratio of Segment
Sales Composition Ratio ofSegment

13,654
63,271
25,670144,688

45%

48,8197%

13,09534%

57,625

14%

26,574

March 2019

■ Aviation & Airport（Million yen）

Note: Sales including inter-segment transaction

185,726
84,444

Financial Results for Year Ended March 31, 2020

33%
9%

40%

18%

March 2020

■ Life Service-12-■ Retail■ Food & Beverage

Copyright © JALUX Inc. All Rights Reserved.

8 Aviation & Airport

Financial Results for Year Ended March 31, 2020

Aviation & Airport（Million yen）

March 2019
Net sales1
Operating profit2△35,625

57.8%

558

1,449

+891

259.6%

418

1,437+1,018343.0%

Remarks

2 Operating profit before allocating common expenses· Decrease in sales for a major customer in the aircraft-engine
parts business

84,444· The aircraft engine lease business in Singapore remains steady· Increase in equity gains of affiliated companies in the overseas
airport operation business

48,819418

March 2019

YoY（%）

48,8191 Net sales and Operating profit including inter-segment transactions

558

YoY

84,444＊＊

Ordinary profit

March 2020

1,449

Note: Used aircrafts for sale recorded in the same period last year

1,437
March 2020
-13-

Copyright © JALUX Inc. All Rights Reserved.

9 Life Service

Financial Results for Year Ended March 31, 2020

Life Service（Million yen）

March 2019
Net sales1
Operating profit2＊＊

Ordinary profit

March 2020
13,095

△559

95.9%

1,133

1,283

+149

113.2%

655

759

+104

115.9%

1,133

1,283

655

759

March 2019

Remarks· Real Estate:As for real estate development, propositions
strictly selected due to the domestic market
environment

2 Operating profit before allocating common expenses

13,095YoY（%）

13,654

1 Net sales and Operating profit including inter-segment transactions

13,654

YoY

Increase in agency services, facility management
and construction· Insurance: Expanding insurance sales to JAL cardholders and tocorporates· Machinery : Paper materials and packaging materials& Materials remained relatively unchanged year on year
Increase in sales of special vehicles

A successful sales strategy increasing road repair
materials sales

March 2020
-14-

Copyright © JALUX Inc. All Rights Reserved.

10 Retail

Financial Results for Year Ended March 31, 2020

Retail（Million yen）

March 2019
Net sales1
Operating profit2＊＊

Ordinary profit

March 2020
57,625△5,646

91.1%

3,912

2,308

△1,604

59.0%

3,437

1,900

△1,536

55.3%

3,437
March 2019

Remarks· Airport Shops:Decrease in sales due to closures of some storesin the previous year
BLUE SKY

2 Operating profit before allocating common expenses

3,912

YoY（%）

63,271

1 Net sales and Operating profit including inter-segment transactions

63,271YoY

Decline of air passengers in 4Q

57,625· Duty-free shops:A store renovation
JAL DUTYFREE

2,308

Change of consumer behavior in inboundmarketing
Decline of air passengers in 4Q· Duty-free distribution : Despite expanding customers,

1,900

reduced demand in 4Q
Increaseinonline shop sales· Mail Order :March 2020

· Food gifts : Decrease in department store customers in 4Q-15-

Copyright © JALUX Inc. All Rights Reserved.

11 Food & Beverage

Financial Results for Year Ended March 31, 2020

Food & Beverage（Million yen）

March 2019
Net sales1
Operating profit2+903

103.5%

911

846

△64

92.9%

420

347

△72

82.7%

911

846

420

347

March 2019

March 2020

Remarks· Marine : Increase in sales of fish processed for sushi to be
Products eaten raw
Expanding fresh fish export to “Thonglor Nihon
Ichiba”

2 Operating profit before allocating common expenses

26,574

YoY（%）

26,574

1 Net sales and Operating profit including inter-segment transactions

25,670

YoY

25,670＊＊Ordinary profit

March 2020

· Agricultural: Increase in sales of red peppers and cherry
tomatoes, decrease in sales of okra
Products
High transportation cost in 4Q· Wine:Increase in sales of champagne and Chilean wine
Rise in sales promotion and inventory holding cost

· Processed: Increase in wholesale of original souvenir sweets
Increase in export and sales of Japanese brand sweets
foods· Food manufacturer : Decrease in sales of lunch boxes fortransport-related retailers in 4Q-16-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Forecasts for the Fiscal Year Ending March 31, 2021

-17-

Copyright © JALUX Inc. All Rights Reserved.

12 Management Policy in FY2020

Financial Results for Year Ended March 31, 2020

Execute Strategic Defense

 Maintain a healthy financial foundation-Reform cost structure, enhance credit management, and create appropriate
investment opportunities→ Secure enough free cashflow, minimize loss, and reduce damage to assets
Promote Portfolio Management

 Optimize the business portfolio by the balance of the income structure insegments-Radical reform in the airport retail business, intensive inspection of otherexisting business domains, develop new business, and create synergies
between segments→ Improve the profitability in each business
Enhance Corporate Governance Propose a strategic plan for sustainable growth through sound governance-Acting for fair management and transparency in decision-making→ Secure soundness in management and increase the corporate value-18-

Copyright © JALUX Inc. All Rights Reserved.

13 Forecasts for the Fiscal Year Ending March 31, 2021

Financial Results for Year Ended March 31, 2020

Forecasts for the Fiscal YearEnding March 31, 2020

（Published figures）

March 2020

（Million yen）

March 2021（E）

YoY

YoY（%）

144,688

110,000△34,68876.0%

Operating profit

3,969△2,200△6,169－Ordinary profit

4,738△1,900△6,638－

Profitattributable to owners of parent

3,081△1,200△4,281－

Earnings per share（yen）

243.69△94.91△338.60－

Net sales-19-

Copyright © JALUX Inc. All Rights Reserved.

14 Impact of COVID-19 on Forecasts

Financial Results for Year Ended March 31, 2020

Segment profit

Sum
Aviation& Airport
Life
Service

RetailFood& Beverage

2.5bn

10.5bnCorporate
expenses Ordinary profit

8.0bn

Non-operating
profit

2.0bn

4.5bn

（JPN bn）

OperatingprofitOperatingprofit1.5bn

Medium-Term Management Plan
Forecast in FY2020

Segment profit
Sum

1.2bn
1.2bn
3.6bn

7.2bn

Corporate
expenses

OperatingprofitOrdinary profit

6.2bn

Non-operating
profitOperatingprofit1.2bn
Forecast in FY 2020
planed before COVID-19

Forecast in FY2020(Announcement on April 30,
2020)

1.0bn
1.1bn
0.1bn

Segment profit
Sum

0.1bn

▲8.1bnCorporate Ordinary profitbn▲2.1bn expenses ▲1.9

Operating loss
-20-

Impact of
COVID-19

Non-operating
profitCopyright © JALUX Inc. All Rights Reserved.

15 Performance Trends

Financial Results for Year Ended March 31, 2020

Performance Trends（Million yen）
Net Sales

89,082
1,656

85,937
1,247

99,837
1,766

112,717
2,684

141,502

Ordinary profit

143,217
4,222

3,937

153,404
5,166

185,726
144,688
5,094

4,738

110,000▲ 1,900

March 2012 March 2013 March 2014 March 2015 March 2016 March 2017 March 2018 March 2019 March 2020 March 2021（E）

Previous Medium-Term Management Plan

Current Medium-Term Management Plan

-21-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Review of Medium-Term Management Plan

-22-

Copyright © JALUX Inc. All Rights Reserved.

16 Medium-Term Management Plan “Next Stage 2020”

Financial Results for Year Ended March 31, 2020

Establishment of long-term vision:
To become a business leader creating JALUX VALUE with partners
all over the world
Medium-Term Management Plan “Next Stage 2020”
New challenges for sustainable growth-To become a global corporate group with its own strengths in the aviation and airport business domains-

Significant strategy:

１ Expand our revenue base

２ Create and develop a new core business

ASEAN
region３ Optimize the business portfolio

Foundation of the promotion of strategies:
Cultivate HR andenhance ourorganizational power

Achieve strong funding
capacity and soundfinancial standing-23-

Overseas
key areas
U.S.A.
Deepen the Groupmanagement
Copyright © JALUX Inc. All Rights Reserved.

17 Review of Key Strategy in the Medium-Term Management Plan

Financial Results for Year Ended March 31, 2020

1 Expand our revenue base
• Expand the scale of the aviation and airport business domain and growth of the nonaviation and airport business domain• Decrease the sales of a main customer in the aircraft-engine parts business• The impact from the consumption movement of inbound tourists in the airport retailbusiness and the decrease in profit by the investment for the future.
⇒ Hard to attain the objective of the Medium-Term Business Plan for quantity
•
•
•

2

Create and develop a new core business

Increase sales of environmentally friendly products
Launch the aircraft-engine lease business in Singapore
Open the overseas duty-free shops and “Thonglor Nihon Ichiba” in Thailand⇒ Struggling to develop the above new core businesses for the future••

3

Optimize the business portfolio

The selling of subsidiaries in Thailand and Laos in the agricultural business
The further enhancement of non-aviation and airport business⇒ Allocating our group resources and struggling to complete the ideal portfolio-24-

Copyright © JALUX Inc. All Rights Reserved.

18 Forecast in FY2020: Aviation & Airport Segment

Financial Results for Year Ended March 31, 2020

Strategy

Enhance the coordination ofdomestic and overseas
locations

Segment profit

Develop the aviationrelated asset business（JPN bn）（Operation profit before allocating
common expenses）

Mid-Term
Plan
2.5

0.5

FY18
results

1.4
FY19
results

1.0

FY20
targetExpand the airport
operation and associatedareas

FY2020 segment profit 2.5bn→ 1.0bn (forecast)

Impact of COVID-19:

・Suspension of airline operation globally・Decrease in the deal on new aircraft parts dueto the change in the new aircraft manufacturing
plan・Unforeseen recovery of international
air traffic demand in overseas airport operating
business-25-

Copyright © JALUX Inc. All Rights Reserved.

19 Forecast in FY2020: Life Service Business Segment

Financial Results for Year Ended March 31, 2020

Strategy

Develop real estate aroundairports/Promote theseniors' business

Segment profit

Deepen and broaden theinsurance business（JPN bn）（Operation profit before allocating
common expenses）

Mid-Term
Plan
2.0

1.1

FY18
results

1.2

FY19
results

1.1

FY20
targetEnhance production and sale ofenvironmentally friendly
materials and machinery

FY2020 segment profit 2.0bn→ 1.1bn (forecast)

Impact of COVID-19:

・Decrease travel insurance due to thesignificant decrease of air passengers
・Delay for launching roadrepair materials “AQUA PATCH” inEuropean market and for enhancing
distribution network in U.S.A.

-26-

Copyright © JALUX Inc. All Rights Reserved.

20 Forecast in FY2020: Retail Business Segment
Strategy

Improve MD and service
to meet a variety ofcustomer needs

Segment profit

Develop the global retailbusiness（JPN bn）（Operation profit before allocating
common expenses）

3.9
FY18
results

Mid-Term
Plan
4.5

2.3
FY19
results

FY20
target▲2.1

Financial Results for Year Ended March 31, 2020

Plan and develop original
products and brands

FY2020 segment profit 4.5bn→ ▲2.1bn (forecast)

Impact of COVID-19:

・Significant decrease in the revenue inairport shops including duty-free dueto the significant decline of air
passengers centering on inbound tourists

・Significant decrease in the revenue in theoverseas duty-free business in Vietnam andLaos due to the rapid decline of air traffic
demand-27-

Copyright © JALUX Inc. All Rights Reserved.

21 Forecast in FY2020: Food & Beverage Business Segment

Financial Results for Year Ended March 31, 2020

Strategy

Expand imports and salesof global
high-quality foodSegment profit

Export high-value foods
overseas（JPN bn）（Operation profit before allocating
common expenses）

0.9

FY18
results

0.8

FY19
results

Mid-Term
Plan
1.5

0.1

FY20
targetEnhance the processing andmanufacturing fields

FY2020 segment profit 1.5bn→ 0.1bn (forecast)

Impact of COVID-19:

・Decrease the whole-sales in marine,
agricultural products and wine

・Increase the transportation cost inimport products due to the price increase onair

・Decrease the revenue in lunch boxes for
airports, daily dishes and in-flight meals due tothe significant decline in air passengers-28-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Sustainable Growth of JALUX Group-29-

Copyright © JALUX Inc. All Rights Reserved.

22 Foundation for Sustainable Growth of JALUX Group

Financial Results for Year Ended March 31, 2020

Corporate philosophy

Strategy basics

Contributing to tomorrowYour best partner to create happiness by bringing it to
the people, society and the environment a bright future.

ESG and sustainability initiatives

E (Environment)

S (Social)

Recognize and address
the global
environmental issues asa steward of the Earth

Operation

Contribute to thecommunity and realize aprosperous society

G (Governance)

Enhance the corporate
governance system tomaximize the benefitsof all stakeholders

Resolving social issues
through our business activity-30-

Copyright © JALUX Inc. All Rights Reserved.

23 Our Business Activities to Address Social Issues

Financial Results for Year Ended March 31, 2020

Approach to social issues

ASEAN region
Economic growth/Expansion of employment
Regional revitalizationand overseas expansion
Promote growth intheagribusiness industry

Protection of lifein the forest, on land, and underwater

Food loss and waste
reduction
Maintenance and developmentof the social infrastructure
Aging society

Work-style reform

Company activity[LAOS] Airport operation in Vientiane (NS: 450 people), duty-free shops (NS: 30 people)

SDGs[Myanmar] Airport operation in Mandalay (NS: 720 people)[Vietnam] Duty-free shops (NS: 100 people), fisheries processing business[Thailand] Serviced apartment, Thonglor Nihon Ichiba, trade of sweets made in Japan
Export agricultural products made in Japan and marine products caught in Japan toThailand for “Thonglor Nihon Ichiba”

Create value chains of agricultural products, marine products, and dairy products made invarious locations in Japan to promote the agribusiness industry
Sell Japanese regional specialties in collaboration with Japan Airlines’ project

Import and sell vegetables such as red peppers, okra, asparagus, tomatoes and so on fromaround the world
Import and sell fish such as salmon and mackerel from around the world

Import and sell wines from countries around the world such as USA, France, and Chile
Sell eco-friendly road-related materials and equipment (AQUA PATCH/AQUA BLACK)
Protect forest resources by promoting paperless initiatives in JALUX Group

Develop supply-chain of marine products in compliance with the law and avoid over-fishing
Using paper straws instead of plastic products in the Airport retail business

Replace shopping bag material with eco-friendly biomass plastic in the Airport retailbusiness
Reduce food loss cooperating with NPOs in the Marine products business

Reduce food waste by providing an eating area at “Thonglor Nihon Ichiba” in Thailand.
Contribute to reducing food loss by developing the frozen food business

Expand residential environment infrastructure through real estate development
Maintain domestic infrastructure by importing bridge inspection vehicles

Enhance aviation infrastructure in the overseas airport operation businesses
Operations of senior apartments and nursery care centers
Adopting flexible hours and remote working

Promote taking annual leave and child-raising-31-leave
Promote health and productivity management

Copyright © JALUX Inc. All Rights Reserved.

24 Strategic Summary for Sustainable Growth of JALUXFinancial Results for Year Ended March 31, 2020

Accelerate
Innovation

 Accelerating innovation to strengthen our earning capacity as follows:
・Making every effort to recover our strong business areas of aviation
and airport.
・Developing JALUX Group’s own value chain in the non-aviation andairport business domains.

PromoteSustainability

 Promoting sustainability to make our business activity contribute to therealization of a sustainable society.
We adopt the values shared the aims of the SDGs as the basis ofmanagement strategies and managerial decisions.
In addition, we disclose information about the results and progress
regularly and enhance objective evaluations such as ESG investment.

Drivers ofGrowth Enhancing our corporate value sustainably by addressing the global
social mission that every company must carry out with two key drivers ofgrowth: “Accelerate Innovation” and “Promote Sustainability.”-32-

Copyright © JALUX Inc. All Rights Reserved.

Financial Results for Year Ended March 31, 2020

Caution Regarding Forward-Looking Statements
This document contains forward-looking statements based on information available tothe company at the time of disclosure and certain assumptions that management
believes to be reasonable.

JALUX makes no assurances as to the actual results and/or other outcomes, which may
differ substantially from those expressed or implied by such forward-looking statements
due to various factors including changes in economic conditions in key markets, both inJapan and overseas, and exchange rate movements.
https://www.jalux.com/en/profile/www.jalux.com-33-

Copyright © JALUX Inc. All Rights Reserved.