Earnings Results
Briefing for the First Six Monthsof the Fiscal Year Ending
March 31, 2023
November 14, 2022
Komehyo Holdings Co., Ltd.
Securities code: 2780
(Tokyo and Nagoya Stock Exchanges)
IR・PR Department
TEL +81-52-249-5366
Email ir@komehyo.co.jp

Contents
１．Overview of Financial Results for First Six Monthsof the Fiscal Year Ending March 31, 2023
２．Initiatives for First Six Months of the Fiscal YearEnding March 31, 2023
３．Reference Information (Company Profile, etc.)

P.2

P.18

P.32

1

Contents
１．Overview of Financial Results for First Six Monthsof the Fiscal Year Ending March 31, 2023
２．Initiatives for First Six Months of the Fiscal YearEnding March 31, 2023
３．Reference Information (Company Profile, etc.)2

FY 2022 2Q Financial Summary
Brand Fashion
Operating income

Net sales

37,314
Millions of yen（YoY 128.9％）

Purchase from individual customers

Tire and Wheel
Net sales
operating loss

1,733

21,604

1,882

Millions of yen

Millions of yen

Millions of yen

Millions of yen（YoY 166.3％）（YoY 141.2％）（YoY 113.8％）（ー）

6Increase in revenue and profit

P13,30.

P20-22.

Purchases from individuals were strong chiefly due to strong purchases at existing stores,
new store openings, and purchase events.

・Shrink operating loss

P16,23.

Accompanying strong individual purchases, corporate sales also performed well

・CRAFT's 50th anniversary campaign produced strong results.
Sales per customer rose after the acquisition of new custom product users.

P19,27.

24 purchase centers opened (of which eleven centers are franchise stores).
A WORM store opened.

・Release of new products from 4×4 Engineering Services.
The Group strengthened sales overseas, and sales increased.

P13.

Opened WORM KOBE

Selby Co., Ltd. has become a Group company.

BRAND OFF opened new franchise stores.
Purchases at BRAND OFF stores were strong.

3Economic Trend
Demand for high-priced items remained strong, as at department stores.
30,000
Nikkei Stock Average(monthly closing price)

Stock price（yen）

Department store(fine arts/jewelry/precious metals)(10 millions of yen)

20,000

KOMEHYO Net sales（Million of yen）

6,000
5,000
4,000

3,000
2,000
1,000

The COVID-19
2nd wave

The

COVID-19
3rd wave

The
COVID-19
4th wave

The
COVID-19
5th wave

The
COVID-19
6th wave

The
COVID-19
7th wave0
FY2023(Source：JAPAN DEPARTMENT STORES）

4

Overview of income statement(Millions of yen)

FY2023
1Q

YoY

Record-high sales and profits

FY20232Q

YoY

FY2023
1H

YoY

vs 1H plan※

Net sales

18,753132.4%

20,466124.2%

39,220128.0%

101.9%

Gross profit

4,717

118.4%

5,092

120.8%

9,810

119.6%－

Gross profit
margin25.2％△2.9pt24.9％△0.7pt25.0％△1.8pt－SG&A expenses

3,978114.4%

4,088

113.1%

8,066

113.8%－

Operating income

739

145.3％

1,004

166.9%

1,744

157.0%

112.5%

3.9％＋0.3pt4.9％＋1.2pt4.4％＋0.8pt－Ordinary income

760

147.4％

949

155.6%

1,709

151.8%

119.5%Net income attributableto owners of parent

519

154.0％

572

148.4%

1,091

151.0%

109.2%

Operating profit
margin※ Earnings forecast announced on August 8, 2022

5

Operating income increase and decrease factor
Purchases from individuals remained strong and net sales increased.
Operating income grew significantly thanks to expense control and other efforts.

Increase in selling expenses such as
advertising expenses △410
Increase in personnel expenses
such as salaries and allowances △367
Increase in general administrative expenses
such as depreciation △198

Operating income(Millions of yen)

Gross profit margin increase6Changes in selling, general and administrative expenses
SG&A ratios declined due to efficiency-oriented advertisements.
SG&A expenses to sales ratio(%)
26.8

21.9

20.0

29.9

23.1

20.6
(Millions of yen)

2,973

General and administrative
expenses +198
・Increase in depreciation, etc.

3,538

Personnel expenses +367
・Increase in salary allowances, etc.

2,774
2,502
1,516

1,425

1,386

1,473

1,629

584

598

778

972

1,143

1,553

FY2021 2Q

FY2022 2Q

FY2023 2Q

FY2021 1H

FY2022 1H

FY2023 1H

2,755

3,171

1,792

Year-on-year trend in thepast three years

Selling expenses+410

・ Increase in advertising expenses, etc.

Quarter-by-quarter trend7Non-operating income(loss) / Extraordinary income(loss)
Rent expenses on store 183（construct in progress）
Interest expenses 25
Other 9Non-operating
losses 219

Impairment losses
52
Loss due to temporary closure 4
Loss on retirement of fixed assets 3

Extraordinary losses 60(Millions of yen)

Non-operating
income 184

Extraordinary
income 6

Foreign exchange gain 93
Compensation income 58
Dividend income
10
Commission income
3
Insurance claim income 1
Other
16

Grant income 68

Balance sheet overview(Millions of yen)

FY2022

FY2023 1H

29,45334,061＋4,608Cash and deposits

9,080

9,706

＋626

Inventories

15,30818,813

Other current assets

5,065

5,541

＋475 →Individual purchases are brisk, SELBY Co., Ltd.

Non-current assets

10,213

11,147＋934

Assets39,66745,209＋5,542

Liabilities

18,96623,154＋4,187

13,51918,316＋4,796

5,446

4,838

－608

Net assets

20,70022,055＋1,354 →Attributable to an increase in retained earnings and other factors

Liabilities andnet Assets

39,66745,209＋5,542Current assets

Interest-bearing liabilities

Other liabilities

Change＋3,505 →Increase cash on hand in preparation for personal purchases
Inventory increased due to grouping→Borrowings increased due to an increase in cash on handand inventories and the purchase of shares of SELBY Co., Ltd.

9Cash Flow trend
Operating cash flow decreased partly due to an increase in inventories in preparation
for a busy season in the second half of the fiscal year.
Cash and cash equivalents increased due to an increase in short-term borrowings, etc.
12,423

11,894

11,441

10,738
9,249
7,330
6,216
4,178
1,651

1,213
273

△ 1,332

FY2020 1H

2,109

Cash flows
fromoperatingactivities

4,379

1,353

Cash and cash
equivalents(Millions of yen)

Cash flowsfrominvestingactivities

3,983
Cash flows fromfinancing activities

1,134

669

△ 1,268

FY2020△ 1,169

FY2021 1H△ 1,222

FY2021△ 288△ 912△ 1,503

FY2022 1H△ 529△ 1,895

FY2022△ 1,177△ 2,520

FY2023 1H
10

Gross Merchandise Value
GMV,which indicates the scale of our business , is an indicator of the promotion of relay use.
GMV groeth leads to business growth and improved profitability.
Gross Merchandise Value

51,07751,6732H

1H(100 millions of yen)
40,77839,071

41,09736,42027,692

1H
FY20202H

1H

2H
FY2021

1H
FY2022

FY2023

GMV is calculated simply by adding and subtracting sales and volume information at the KOMEHYO auction based on consolidated sales.

11Breakdown of Net sales (Retail / Overseas)
Corporate sales had a higher percentage due to strong purchases and for keeping stock new andfresh. Retail was also bullish and sales rose 10.8% year on year.
Overseas sales were steady partly due to the easing of lockdowns in Shanghai.

Overseas

10.2%
RetailFY2023 1H
Net sales
43.5%
sales,etc.
39,22056.5% (Millions of yen)

Corporate

FY2023 1H
Net sales
39,220(Millions of yen)※Domestic

89.8%※ "Corporate sales" includes auction fees.

※The ratio of overseas business does not include domestic tax-free sales, etc.

12Overview by segment
In the Brand Fashion business, both sales and profit increased thanks to strong purchases fromindividuals and the strong results of auctions for companies. Sales and profit also increased in
the Tire and Wheel business owing to the strong sales of custom products.
(Millions of yen)

FY2023
1Q

FY20232Q

YoY

FY2023
1H

YoY

YoY

17,794134.0％

19,519124.6％

37,314128.9％

Operating income

730

154.4％

1,002

176.1％

1,733

166.3％

Operating margin

4.1%＋0.5pt5.1％＋1.5pt

4.6％－

Net sales

947

109.6％

935

118.4 %

1,882

113.8％

Operating income

2

－

△9

－

△6

－

Operating margin

0.3％

－

－

－

－

－

Net sales

71

84.9％

71

84.5％

143

84.7％

Operating income

21

86.5％

20

80.8％

42

83.6％

Operating margin

30.3%＋0.5pt28.8％△1.4pt29.6％

ーNet sales

Brand
FashionTire and
Wheel
Real estateleasing13

Purchase from individual customers (Group total)
Purchases from individuals remained favorable, rising 36.5% year on year, with the opening of
Komehyo’s purchasing centers and BRAND OFF's purchasing centers (franchise stores),the holding of Kaitori Go purchasing events, and an increase in the amount of purchases per
customer.
Number of stores
162
94

116

116

5,599

FY2021 2Q

FY2022 2Q

FY2023 2Q

Year-on-year trend in thepast three years

126

162

148

Purchase fromindividual customers(Group total)(Millions of yen)

9,858

11,052

10,552

7,728

8,983

FY2022 2Q

FY2022 3Q

FY2022 4Q

FY2023 1Q

FY2023 2Q

10,552
7,728

137

Quarter-by-quarter trend※The individual purchase amount is the amount purchased from an individual customer throughthe following route.
・Purchasing at stores
・Purchasing at visited sites
・Purchasing at events・Purchasing using home delivery services

14

Trends in Net sales and Gross Profit Margin
Purchases from individuals were strong. The ratio of corporate sales with low gross margins increased.
Gross profit margin(%)
26.1

12,95725.6

16,47225.0

20,466FY2021 2Q FY2022 2Q FY2023 2Q
Year-on-year trend in thepast three years

Trend in gross profit
margin25.6

16,472

26.3

19,23724.2

21,27625.2

18,75325.0

20,466Net Sales(Millions of yen)

FY2022 2Q FY2022 3Q FY2022 4Q FY2023 1Q FY2023 2Q

Quarter-by-quarter trend

・The figure tends to rise in the third quarter, when the ratio of retail is high in the year-end busy season.
・Inventories are revised in September and in March. The figure tends to fall in the second and fourth quarters.
・The figure may vary depending on the weightings of items that can be purchased.

15

Changes in corporate auction trade volume
The corporate auction trade volume remained strong chiefly due to an increase in the number of registered members.

Number of registered members

2,743

2,966

8,775

3,409

9,854

2,966

8,775

3,095

3,124

9,969

3,280

3,409

10,255Trade volume
9,854 (Millions of yen)

8,553

JBA

6,786

KOMEHYO
AuctionFY2021 2Q FY2022 2Q FY2023 2Q

Year-on-year trend in thepast three years

FY2022 2Q FY2022 3Q FY2022 4Q FY2023 1Q FY2023 2Q
Quarter-by-quarter trend※KOMEHYO auction：The online auction method※K-BRAND OFF：Japan Brand Auction(JBA)TOKYO－the real bidding method
Japan Brand Auction(JBA)KANAZAWA－the live auction method
JBA Live Net Auction－The online bidding method16E-commerce-induced sales rate(KOMEHYO)
While the infection situation of the new corona is calming down, shopping habits via EC are firmly established
Focus on own EC site (KOMEHYO ONLINE) with high advertising cost-effectiveness by controlling the numberof listings on other companies' sites
E-commerce-induced sales rate：EC Sales as a Percentage of Retail Sales

46.1

44.6

46.1

43.8

49.5

43.6

44.6

21.3

2,005

2,333

2,512

2,814
2,333

2,803
2,197

E-commerce
induced sales(Millions of yen)

2,512
KOMEHYO website

Back orders
Others

FY2021 2Q FY2022 2Q FY2023 2Q
Year-on-year trend in thepast three years

FY2022 2Q FY2022 3Q FY2022 4Q FY2023 1Q FY2023 2Q
Quarter-by-quarter trend※KOMEHYO website: Make a purchase by directly clicking the KOMEHYO online or by making a phone call to a contact center and receiving a customer service.
Back orders(Purchasing from a catalog): Make a purchase after choosing a product from a catalog at the KOMEHYO online store, having the product delivered toa nearby KOMEHYO making sure of the product in person.
Others(Other companies’ websites): Make a purchase at a store KOMEHYO set up at an Internet sales site operated by another company.

17目次
１．Overview of Financial Results for First Six Monthsof the Fiscal Year Ending March 31, 2023
２．Initiatives for First Six Months of the Fiscal YearEnding March 31, 2023
３．Reference Information (Company Profile, etc.)

18

Stores：Group total 162 stores（As of September 2022 )The figure in parentheses ( ) represents the increase during the second quarter.

Brand Fashion

5

Flagship stores

２
2

Sales Stores
Stores annexed withsales facilities

12

Purchasing Center

71 ( 4 )

3（1）

2

2

10

3（－1）

2

10

3

8

Franchised
purchasing centers

13 ( 8 )Overseas

5

Total

93

BRAND OFF
KANAZAWA store

1
6

6

Tire and Wheel

118

Shellman GINZA store

36

7

WORM OSAKA

3

Craft NAKAGAWA store

SELBY
OKAMACHI store

19Effect of opening the purchase center (KOMEHYO)
More than 30 purchase centers have been opened since the previous fiscal year,
and 100 purchase centers will have been opened in the three years, in places where customers pass by daily.
We are planning to increase purchase from individual customers by 3.0 billion yen per year (1.5 billion yen
during the fiscal year), targeting purchases from individual customers at 100 million yen per purchase center.
(100 million of yen)

15
30
20

257

New store openings
during the period

15
30
30

New store openings during theperiodFor stores opened in theprevious term

For stores openedin the previous
term

Existing
store

3
14

169

FY'21

FY'22

FY’23 1H 'FY'23(PLAN)(achievement) （計画）

FY'24(PLAN)
（計画）

20

Efforts to strengthen purchasing（KOMEHYO）
Five purchasing centers launched
Miyazaki Yamagataya / Meitetsu Department Store/
Keikyu Department Store / Tachikawa Takashimaya S.C. / Yagoto

36 purchase events held
• At commercial facilities and department stores considered to bereassuring, familiar and close to consumers since they are found intheir daily life
• Events may lead to launch of permanent stores.

21

Efforts to strengthen purchasing（K-BRAND OFF）
A hundred franchised purchase centers will be set up in the three-year period starting in the previous fiscal year.
We are aiming to introduce at least 20 new stores by the end of the current fiscal year.
Items purchased at franchise purchase centers are put to auction (JBA). The trade volume thus increases.
Franchise purchasing center specialty store opening plan（domestic）)
New centers in the year

Progress in openings in theyear ending March 2023

55％

An increase in bases for purchase helped increase thetrade volume in the auction.
Product
commercial
izationended March 2024

80

New centers in the year
ended March 2023
New centers in the year
ended March 2022

20

2

Generalcustomers

Generalcustomers

Purchasing

Existing store

FY2022

FY2023

Exhibit

FY2024
FC

Opened 11 FC purchasing specialty stores
FY2023-1Q

FY2023-2Q

FY2023 1H

3 store8 store11 store

Generalcustomers

Advantages of the owner ofa franchise center・Opening a center at low cost・Educational support
・Use of AI (assessing authenticity
and model numbers)
・call center

An attractive platform on
which an abundance of
items are placed for auction

Corporation

22

Product distribution (FY2023-1H KOMEHYO)
Purchasing
Purchase fromindividual customers

78％

KOMEHYO
Merchandise center

Stores/Home delivery Purchasing/Purchasing at
events/Purchasing at visited sites

41％

28％

26％

Purchase from
corporations

Sale

quality/market/distribution

5％
22％

Supplementing individual purchases mainly for the purpose ofmaintaining the attractiveness of stores

43％
Suitable for retail

Products purchased
nationwide are sent here,
and skilled appraisers
assess their authenticity
and maintain them as
needed.

The center manages
individual items, paying
attention to turnover andinventory risk,
and links online store
inventory and physicalstore inventory to provide
products to the mostappropriate buyers.

RetailStore
WEB（company,Other company,live commerce）• Not appropriate for retail(bad condition, etc.)• Expensive stock• High market price risk

57％

Corporate sales
Auction（company,Other company）
Ivent
wholesale（domestic・overseas）
Live commerce23

Continue strengthening OMO（FY2023-1H KOMEHYO）
Contact center
Customer services on smartphones
A total of 287 staff members across the country holds
smartphones exclusively for customer services todigitally communicate directly with customers.
After-sales services and customer needs are stored inform of data and notices are given about incoming goods.
That opens the way for more in-depth one-to-one
communication.

actualresults

Number of customers
that can be communicated1.1 Folds YoY
Number of sales
1.3 Folds YoY
Number of purchases 1.3 Folds YoY

Live Commerce
Chinese influencers launch live commerce sites onsocial media.
That increases frequency of live commerce events.
KOMEHYO will handle inventories for live commerce
in a bid to boost profitability of corporate sales.

。

actualresults

Sales
1.3 folds YoY
Gross profit 1.4 folds YoY

A contact center was set up in August 2020 as a function
for the e-commerce.
It responds to inquiries on goods, how to operate andothers through voice and chat communication.
KOMEHYO seeks to build a shopping environment thatallows customers to purchase without worries on the
non-face-to-face platform and to easily obtain
information they want.

actualresults

Number of chats 1.1 folds YoY
Number of orders placed over the phone 0.7 folds YoY
Sales per customer through the contact center
1.2 folds the level without through the contact center24Technology indispensable to store operation：AI
The system has been introduced to all the KOMEHYO purchase centers, all of K-Brand Off's franchised purchase centers and someof the LINK SMILE and USED MARKET shops. It will be introduced to purchase events and to the global business. It is a technology
indispensable to removal of counterfeit goods from circulation and to growth of the KOMEHYO Holdings Group.

purchase KOMEHYO
centers LINK SMILE
USED MARKET

Assessing authenticity and model numbers ofbags, wallets, purses and small articles fromfamous brands. Supporting Hermes, Louis
Vuitton, Chanel, Gucci and Prada

Futuredevelopment plan

Improvement ofcommunication withcustomers（ Enhanced CX ）training
assessors

Franchised
purchasing
centers

Curtailment of time fortraining assessors(Shorter lead time for launch)

BRAND OFF

Support for owners(Superiority in acquisition of
new franchisees)

Purchase events

Improvement of communication with customers

GLOBAL

Prevention of the know-how drain
To be introduced to overseas stores as well25

Format of auctions among companies
KOMEHYO Auction and JBA complement each other in terms of area, date and format of the event.

Frequency of corporate auctions(K-BRAND OFF)

Jewels /watches /bags

Online auction 2 times/ month

Apparelclothing

Online auction Monthly

JBA
Kanazawa

Real auction Monthly

JBA Tokyo

Online auction Monthly

JBA
Live net

Online auction
Every Monday and Thursday

26

The First Shop of Premier Sneaker Shop WORM in a Department Store Opens
WORM KOBE, the first WORM shop in a retail facility, opened on August 30, 2022. WORM has now three
shops in Japan. The new shop can offer products to new types of customers, such as wealthy peoplebrowsing in the department store and female customers. Purchases have been favorable.

27Subsidiary SELBY Co., Ltd.
Company Profile

Business features

Company name

SELBY Co., Ltd.

Head Office

2F RT Building, 5-22-4 Ueno, Taito-ku, Tokyo

Purchase and sale of used jewelry

Representative

Shinji Ishihara•

Business content

Purchase and sale of used jewelry,
Digital business (system development, creation of websites)

EstablishedFebruary 2001•

Runs two stores that buy and sell jewelry in Okachimachi
and Ginza.
Operates an e-commerce site, Re:QUEST.

Strengthens sales and the purchase of jewelry, an
important category of products.

Outline of the consolidation
Overview

SELBY Co., Ltd. has become a wholly owned subsidiary.

Subsidiary dateAugust 17, 2022

Date of consolidation••

The balance sheets has been consolidated since the second FY2023-2Q.
The statements of income will be consolidated from FY2023-3Q.
Goodwill

Digital business

152 million yen

Sale of OMRIS, a jewelry sales management andinventory linkage system, to external customers
Digitally savvy human resources

Promotes digital transformation in the entire Groupand creates new value in the reuse tech area.

28

Plans to open stores overseas (Thailand, China)
SAHA KOMEHYO（Thailand）
Will open two stores by December 2022 and run a total of four stores. 41.

KOMEHYO SHANGHAI（China）
Will open a store by December 2022.

Aims to run five stores by the fiscal year ending March 31, 2025.

KOMEHYO Terminal21 rama3 store

KOMEHYO J-park Sriracha NIHON-MURA

KOMEHYO MOHO SHANGHAI（Opening October 20,2022 ）（ Scheduled to open on December 16 ）（ Scheduled to open in late December ）We will purchase and sell goods locally and expand business, while striving to get reuse to take root.
We aim to run a number of stores particularly in Asia.
29

Tire and Wheel
Sales of used tires and wheels increased from a year ago due to strong online sales. The operating loss was reduced significantly.

Craft

4×4 engineering service

Auto Parts Japan・The 50th anniversary renewal event was held
to increase wheels and supplies for custom
product users. The event attracted customers,
and sales per customer rose.

• Introduced an automatic washing machine toimprove the efficiency of used productoffering operations, which resulted in an
increase in sales.

・Sales of summer tires per customer andgross profit increased, reflecting price hikes atmanufacturers.

• Introduced an automatic washing machine toimprove the efficiency of used productoffering operations, which resulted in an
increase in sales.

•

Introduced an automatic washing machine toimprove the efficiency of used product offering
operations, which resulted in an increase in sales•

Active participation in offline events led toacquisition of orders.

•Country suspensions for the new Mitsubishi Delica
D:5 and other models sold well.

30

目次
１．Overview of Financial Results for First Six Monthsof the Fiscal Year Ending March 31, 2023
２．Initiatives for First Six Months of the Fiscal YearEnding March 31, 2023
３．Reference Information (Company Profile, etc.)

31Corporate Profile
Company name

Komehyo Holdings Co., Ltd.

EstablishedMay 1979

Head Office

3-25-31 Osu, Naka-ku, Nagoya

Representative
Capital※Transition to holding company system in October 2020

President, Representative Director: Takuji Ishihara
1,803 million yen

No. ofemployees

Consolidated: 1,049 Non-consolidated: 25 (As of September 2022)

Business
activities

Management planning, business operation support, administration and others for the
corporate group engaging in the Brand-Fashion Business and the Tire-Wheel Business

Fiscal year-end
Stock

March
Second Section, Tokyo and Nagoya Stock Exchanges(Securities code: 2780; Unit: 100 shares)32

Corporate History●Acquired Eve Corporation Co.,Ltd.
●Established KOMEHYO SHANGHANI LIMITED●Established Auto Parts KOMEHYO(currently AUTO PARTS JAPAN)●Established KOMEHYO HONG KONG LIMITED● Acquired CRAFT Co., Ltd.
●Established KOMEHYO Auction●Opened KOMEHYO Shoten,
a 5-tsubo used clothing store, in Osu, Nagoya

1979

1987

1996

2000

2003

2004

2011

2012

2013

2017

2018

●Transition to a holding
company structure●Opened the second
store in Bangkok,
Thailand

2019

2020

2022

●Opened KOMEHYO Ginza Store●Acquired Shellman Co.,Ltd.
●Listed on the second section of the Tokyo●Established SAHA
and Nagoya stock exchanges
KOMEHYO COMPANY● Listed on JASDAQ
LIMITED● Established
KOMEHYO Co., Ltd.

●Expanded into Kansai(KOMEHYO Shinsaibashi Store)●Started online sales●Expanded into Tokyo(KOMEHYO Purchasing Center Dogenzaka)● Changed the Japanese spelling of
its name from 米兵 to コメ兵●75th ANNIVERASARY●Shift to the Standard
Market of the Tokyo
Stock Exchange andto the Main Market of●Acquired Four by four engineering service the Nagoya Stock
Co.,Ltd
Exchange●Retail store KOMEHYO opened in Bangkok, ●Acquired SELBY Co., Ltd.

Thailand●Acquired K-BRAND OFF Co., Ltd
and two overseas subsidiaries

33

Mission
Komehyo Holdings is necessary for a sustainable recycling society.
It acts as a relay point in the connection of “people,” “things,” and “society.”
We will strive to connect “good quality" and "value" to the future.

We respect people for making products, thank people for providing
products for use by other people, and make people who reuse suchproducts happy, and by doing so, create an empathy-based recycling
society.
We develop a concept of environmentally and sociallyconscious recycling into a culture.

We listen and empathize with what others say.
We value the importance of talking.
We take action proactively.
We are not afraid of creating change.
34

From reuse to relay use
We will inherit that "value".

Maintenance, remake, editing, connection with people.
"Relay youth" is not just a downcycle of the value of things,
but an upcycle of increasing the value, even though it isreused.
As values for a sustainable future society spread, we willcontribute to the formation of a sustainable society by
respecting producers and users and relaying their "feelings".

35

KOMEHYO HD Group materiality (important issue)
Work on four tasks of purchase, sales, appraisal, and restoration to realize the circulation of value throughenvironmentally and socially conscious recycling, in pursuit of both promotion and growth of reuse and value
improvement of used goods.

Purchase Making reuse a common practice in society
Promotion and growth of reuse
Sales

Purchase

Restoration

Appraisal

Sales

Developing the reuse market further

Appraisal

Pursuing fair sustainability
Value improvement of used goods

Restoration

Restoring value with our unique technical capabilities

Value Chain for RELAY USE

36

A value chain where value circulates through relay use
Developing the reuse market further

Making reuse a common practice in society

Contributing to the development of the reuse market by proposing quality
items, taking advantage of the diversity of new items, unused items, items
for reuse, and others

Making it a common practice to sell goods which will no longer be used
Promoting education and creating opportunities for breaking away from thesocial structure of mass production for mass consumption● Revitalizing the reuse market through BtoB auctions● Initiatives to ensure that recycling of goods creates new value and leads to happiness● Providing unique value● Strengthening measures to drive KAITORI GO (creating opportunities through cross-industrial
collaboration)● Disseminating the reuse culture to other countries to deliver quality● Improving engagement

used goods to the world● Disseminating the culture of handing down goods from person to person, from Japan to the world● Introducing environmentally friendly shopping bags

● Creating an environment where goods can be purchased casually without worry● Expanding the reuse customer base in Japan and overseas● Cooperating with related government ministries and agencies and related organizations

Sales

Purchases

Restoration

Evaluation

Restoring value with our unique technical capabilities
Creating new value by understanding the intrinsic value of goods andapplying expertise that has been accumulated internally over many years 。
● Manufacturing and discovering distinct, attractive products● Next vintage, vintage, and antique products● Repair/restoration of fashion items, bags, watches, and jewelry● Product lineup for offering good quality from all over the world● Improving product knowledge● Developing the standard of product quality of Japan in other countries

Pursuing fair sustainability
Creating a sound reuse market, where anyone can have a sense of
security, with the Komehyo Holdings Group's skills to determine the value● Promoting reuse technologies (use of AI for assessing authenticity and model numbers)● Eliminating counterfeit goods from the reuse market● Working together with partners (business partners, franchised store owners, and auction members)● Efforts to ensure fair purchase prices and sales prices● Awareness-raising activities to prevent trouble or damage related to reuse , such as coercive buying● Developing appraisers with a unique curriculum

37Corporate governance system

The Group's management efficiency
and business performance are aimed
at respecting the interests of not only
shareholders, but also employees,
customers, business partners, creditors,
local communities, and other people
who have great influences andinterests. We are working onstrengthening corporate governancewith an emphasis on improvement andcompliance as the most importantmanagement issue.

38Officer system

Skills matrix

Name

Takuji Ishihara

Toshio Sawada

Yuya Yamauchi

Masaru Hirauchi

Yoshiko Nakahara

Kazutoshi Torita

Momoko Murase

Miyuki Minamiru

Title

President andRepresentative Director

Managing Director

Director

Outside Director

Outside Director

Director(Audit and Supervisory
Committee Member)

Outside Director(Audit and Supervisory
Committee Member)

Outside Director(Audit and Supervisory
Committee Member)

Corporate management

〇

〇

〇

〇

Management strategy andplanning

〇

〇

〇

〇

〇

〇

Marketing〇〇〇Experience and knowledge
in the industry

〇

〇

〇

〇

Business development andinnovation〇

Global
IT・DX

〇
〇

〇

〇

〇

〇

〇

Finance・Accounting〇〇

Legal・Risk Management〇

governance
ESG・Sustainable〇

Qualifications, etc.

MBA

〇

〇

〇

CPA
Tax accountant

Lawyer〇Small business doctor

39

Business system diagrampurchase

Sales

Home delivery
Purchasing

WEB

Purchasing at
eventsAuctionPurchasing at
visited sites

New and used goods business

Used goods businessStoresGeneral customers, etc.

General customers, etc.

StoresUsed goods businessAuctions by other companies

40Medium-term management target (until FY2025)
FY2023 *1(Millions of yen)

1H

FY2024 *2

FY2025 *2*3

Full year

Full year

Full year

Net sales

38,50082,50085,000100,000

Operating income

1,550

4,350

4,400

5,500

Operating profit
margin

4.0％

5.3％

5.2%

5.5%

Ordinary income

1,430

4,350

4,400

5,500

Net income
attributableto owners of parent

1,000

2,830

2,850

3,450

*1 Earnings forecast revised on August 8, 2022
*2 A rolling forecast will be provided in May 2024.
*3 It is expected that retail sales will increase as inbound demand returns in the fiscal year ending March 2025.

41

Sales plan
Will revise forecasts in May 2023.

(Millions of yen)
Revised results
forecasts inAugust 2022.

82,500100,000
85,00071,14857,51050,96040,212

43,19945,90350,72345,497
40,134FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025

42

Operating Profit Plan
7.5

Operating Income
Margin (%)

7.2
6.1

5.2

3.6

5.3

Will revise forecasts in May 2023.

0.5

1.2

Revised results
forecasts inAugust 2022.

4,350
3,129

5.5

3.7

2.1

2,999

5.2

Operating Income(Millions of yen)

5,500
4,400

3,714

2,789
1,625

832

1,860
297

590

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025

43

Ordinary income/Net income Plan

Net income
attributableto owners ofparentOrdinary
income4,350(Millions of yen)Will revise forecasts in May 2023.

5,500

4,400

3,772
3,450
2,988

1,834

3,162
2,830

2,742

2,850

2,259

2,040
1,696

1,610

1,073

815

1,826
1,009
431△ 595

355
9 △ 234

FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023 FY2024 FY2025
Revised results
forecasts inAugust 2022.

44

Shareholder return
The annual dividend forecast is revised upwards from 44 yen to 50 yen per share, in considerationof the projected income level and others for the fiscal year ending March 31, 2023.
Aiming to increase dividends consistently in line with the status of profit and cash flow.
Payout ratio(%)

92.4
36.2

24.8

29.3

23.0

16.6

15.5

15.0

(planned)

30.6 34.7

19.4

15.5

Fiscal year-end dividendInterim dividend

5
7

7
5

7
7

8
8

10
9

19.4

25
15

15

15

16

15

14

11

14

15

15

15

16

20

8
16

8
8

25
12

FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 FY2023

45

Medium-term management plan:
Continuous business expansion through investments in growth businesses and human resource development

Brand Fashion
BtoC

BtoB

Oversea

１．Achieving growth with existing core businesses
２．Achieving growth with businesses that contribute to the distributionof used goods to revitalize the market
３．Achieving growth with businesses that contribute to market growth
and the formation of a sound market

Tire/Wheel
１．Strengthening profitability

メーカー

２．Strengthening product development
３．Making attempts at businesses and items with affinity
1次流通

2次流通

46

Growth in the brand reuse market image

Important investment items
・Human resource recruitment anddevelopment
・Stores (openings/reorganization)・IT (reuse technologies)
・Marketing
・Sustainability

Supporting managementfoundations
・Organizational development
・HR development③Businesses that contribute to distribution②Businesses that contribute to market growth①Core business

Achieving growth by
expanding networks withcustomers, such aspurchasing and selling
goods in Japan and othercountries

Increasing the grossmerchandise value(GMV) with businesses
linked with corebusinesses, such as
operation of BtoB
auctions

Businesses based on
support for or cooperation
with users and business
operators in the reusemarket provided andmade by using our own
assets, which lead to the
expansion of the reusemarket of brand goods

Tactics options
・M＆A
・Capital alliance・Business alliances

47

Medium-term Management Plan : Brand・Fashion
Gaining more influence in the reuse market by making maximum use of the Group's assets
１．Achieving growth with existing core businesses＝Domestic＝・Increasing the number of purchasing channels(continuing to open purchase centers and strengthening alliances)
・Creating seamless customer touch points by using
digital technologies and improving the customer experience value through the reorganization of stores
・Improving the value of used goods by means of upcycling＝Overseas＝・Strengthening purchase and sales through the opening of new stores at each base, etc.
・Developing new bases
・Building a network for the distribution of products among overseas bases

48

Medium-term Management Plan : Brand・Fashion
Gaining more influence in the reuse market by making maximum use of the Group's assets

２．Achieving growth with businesses that contribute to the distribution of used goods to revitalize the market
・Auctioning more items through franchise development(openings of 100 purchase centers by franchised stores)

・Providing reuse technologies, expertise, and market information to member companies
・Acquiring new member companies in Japan and other countries by using digital technologies

３．Achieving growth with businesses that contribute to market growth in Japan and overseas and the formation of a soundreuse market
・Supporting the growth of reuse-related businesses with SaaS・Supporting new entrant companies, etc. by using human resources and training systems
・Business cooperation using databases (customer data and product data)49

Medium-term Management Plan : Tire・Wheel
Expanding the business by strengthening profitability and investing in growth drivers
１．Strengthening profitability through collaboration among the three companies
・Strengthening and opening specialty stores developed according to customer preference・Strengthening the sale and purchase of used tires and wheels and controlling their inventory

・Improving productivity and strengthening expertise through investment in human resources

２．Investing in product development
・Planning and manufacturing wheels and automobile parts by taking advantage of brand power・Stepping up efforts to supply products to overseas markets

・Maintaining and increasing brand power in Japan and overseas

３．Approaching businesses and items with affinity
・Used cars
・Automotive supplies
・Car camping supplies

50

Store development in the Ginza area
Ginza is an important area for strengthening retail sales.
Expand stores as a group and expand contact points with customers.

February 15, 2022 KOMEHYO GINZA CLOSEDKOMEHYO銀座店(仮)●●Tiffany

Feb 18-Aug 28 KOMEHYO GINZA LIMITED CLOSEDKOMEHYO GINZA PLUS

●LOUIS VUITTON●松屋銀座

KOMEHYO
GINZAPLUS Former
BRAND OFF
BRAND OFF ●GINZA store
GINZA
●
●
●Shellman GINZA MITSUKOSHI store● Former
KOMEHYO GINZA store
SELBY Ginza
Boutique●

September 1

KOMEHYO GINZA PLUS open

October 8

BRAND OFF GINZA store open

January 2023

● KOMEHYOGINZA LIMITEDKOMEHYO GINZA store
Scheduled to open●
シェルマン
銀座・バーニーズNY店●GINZA SIX ●Shellman GINZA store

BRAND OFF GINZA Store51

Human capital management（KOMEHYO）
In the business model of environmentally and socially conscious recycling, humans play a wide range of roles(knowledge, skills, expertise, speed, relationship with customers, etc.), making it important to take initiatives todevelop and retain human resources.

Sale

Purchase

Reproduction

Evaluation

52

Human capital management（KOMEHYO）
Groupwide training of personnel for the next generation

Education of assessors by a team dedicated toeducation

KOMEHYO provide opportunities for groupwide training aimed at developing
management personnel and executives for the next generation.
It continues training of staff to display their individual capabilities to thefullest degree.
It carries out organizational development directly linked to business
operations to ensure effective human capital management.

KOMEHYO focuses its efforts on education of assessors and sales staff.
The education team has systematized various knowledge and skills
involved in communication with customers.
The system will stably develop assessors requisite to store launch and help
shorten the lead time for it.

53

Human resources retention rate
Employee turnover rate has been low, which means that the employee retention rate has been high.
This enables to accumulate expertise, laying a foundation for stable growth.

General regular workers(except part-time workers)(Ministry of Health,Laver and Welfare)Turnover rate(KOMEHYO)
Turnover rate(GROUP)
12.9
11.3

11.7

12.4
11.5

12.2

11.8

11.4

11.6

11.3

11.4

10.7

8.8
7.6
5.0

5.8

5.8

5.2

3.6

4.5

3.2

3.9

4.6
3.0

3.7

4.0

FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY2018 FY2019 FY2020 FY2021 FY2022

54

Sales shares by segment and by sales channel (FY2022)
By segment

Brand/fashion businessby operating company

Tire and Wheel

Real estate leasing

Other

6.1%

0.5%

10.1%

By sales channel

Retail43.3%

K-BRAND OFF
Consolidated sales
71,148 million yen

14.8%

Brand and fashion businessamount of sales

66,688 million yen(FY2022.3)(FY2022.3)

Brand Fashion

KOMEHYO

93.4%

75.1%

Corporate

Komehyo Sales

sales 50,088 million yen

56.7%(FY2022.3)

EC related sales
46.6% of retail55

IR contact

IR・PR Department
Phone：+81-52-249-5366
E-mail：ir@komehyo.co.jp
Note:This document is an English translation of a document prepared in Japanese.
Statements in this document that are not historical facts; statements concerning current plans, forecasts, strategies, andopinions of KOMEHYO Co., Ltd. are forward-looking statements subject to various risks and uncertainties.
These statements are prepared based on assumptions of the management of Komehyo Holdings Co.,Ltd. using currently
available information.
Actual results may differ significantly from forecasts due to a variety of factors; therefore, investors should not place
undue reliance upon them.
In addition, this document is not intended to solicit investments. Investors should make investment decisions at theirown discretion.

56