FY2016 (6/15-5/16) Interim Results Explanatory Meeting
January 15, 2016
The earnings forecasts appearing in this material are based on the business environment at the present time, andthere is the possibility that actual earnings may differ from forecasts for various reasons.
Furthermore, only inquiries in Japanese are handled.
Inquiries should be direct to Mr. Kasai or Mr. Tamura.
(045-914-8241) in the Corporate Planning Office.

1

FY2016 (6/15-5/16) Interim Results
Explanatory Meeting■1H FY2016 Consolidated Results
1. Profit and Loss Statement 2. Balance Sheet
3. Statement of Cash Flows 4. About the division of stocks■The results of the main business company
1. Profit and Loss Statement (Create SD)
2. New Store Openings
3. Sales by Segment
4. Sales5. Gross Profit
6. Prescription Operations
7. SG&A Expenses■FY2016 consolidated The second half of the efforts
1. Active investment for growth and efficiency
2. Promotion of pharmacies supporting customer health■FY2016 Forecasts (Consolidated)
1. FY2016 Forecasts (Consolidated)

2

1H FY2016
Consolidated Results(06/2015 – 11/2015)3

1. 1H FY2016 Consolidated Profit and Loss Statement
1H FY2015(consolidated)(million yen)

1H FY2016(consolidated)

Share(%)(million yen)

Share(%)

YoYchange(%)% ofprojection(%)

Net sales

104,559

100.0

113,721

100.0

108.8

101.9

Gross profit

27,33526.1

30,885

27.2

113.0

104.0

SG&A expenses

23,08522.1

24,154

21.2

104.6

98.7

Operating profit

4,250

4.1

6,731

5.9

158.4

128.9

Recurring profit

4,457

4.3

6,933

6.1

155.6

129.6

Net profit

2,750

2.6

4,502

4.0

163.7

133.2

4

2. 1H FY2016 Consolidated Balance Sheet(million yen)
May 31, 2015(consolidated)

Total assets

November 30, 2015
(consolidated)

Change88,767 92,271 +3,504

Current assets

51,51254,879+3,367

Fixed assets

37,25437,391+137

42,807 42,530-276

Total liabilities

Main
Maincauses
causesof
ofchanges
changes

Current liabilities

39,38438,993-391

Fixed liabilities

3,422

3,537+114

Total net assets

45,960 49,740 +3,780

Total liabilities andnet assets

88,767 92,271 +3,504

Total assets【Increase factor】
・Increase in cash by the increase in
net income and investment decrease+2,509million yen
・Merchandise+740 million yen
Total liabilities【Increase factor】
・Point reserve fund +90 million yen【decrease factor】
・Account payable-376 million yen
・Unpaid consumption-365million yen
Total net asset【Increase factor】
・Net profit
4,502 million yen【decrease factor】
・Dividend payment -737million yen

53. 1H FY2016 Consolidated Statement of Cash Flows(million yen)

Cash flow fromoperatingactivities
Cash flow frominvesting activities

November30, 2014

November30, 2015(consolidated)(consolidated)

Main
Maincausescausesof
ofchanges
changes

Change◆Cash flow from operating activities
・ Net profit before taxes +2,521 million yen

5,148

5,122-26

・ Corporate taxes paid

-1,205 million yen

・ Accounts payable-trade -1,156 million yen-2,979-1,874+1,105

Cash flow fromfinancing
activities-5,269-737+4,532

Change in cash
and cashequivalents-3,101

2,509+5,611

Opening balanceof cash and cash
equipments

19,335

20,268+933

Closing balance ofcash and cash
equipments

16,234

22,778+6,544・ Point reserve fund-410 million yen◆ Cash flow from investing activities
・ investment to store openings and renovation+978 million yen※ 11 new OTC stores were opened(There are fewer 8 stores than the last year)◆Cash flow from financing activities
・share buyback-4,392 million yen

64. About the division of stocks
A
A 33 forfor 11 stock
stock split
split waswas carried
carried out
out withwith
December
December 16,16, 2015
2015 asas thethe effective
effective date.
date.
EnhanceEnhanceliquidity
liquidityin
inthe
themarket
marketby
byincreasing
increasingthe
thetotal
total
numbernumberof
ofsharessharesissued
issuedAim
Aimto
toexpandexpandthe
theinvestor
investorbase
basebybylowering
loweringthe
theamountamountof
ofinvestment
investmentper
pershareshareunit
unit
The
Thedividend
dividendwas
waseffectively
effectivelyincreased
increasedby
byrevising
revisingthe
theterm-end
term-enddividend
dividendper
pershareshare(forecast)(forecast)fromfrom3535yen
yento
to1212yen
yen(a(adividend
dividendof
of36
36yen
yenbefore
beforethetheconversion.
conversion.*1/3*1/3waswasroundedroundedup).
up).

7

The results of the MainBusiness Company81.1H FY2016 Profit and Loss Statement(Create SD)
1H FY2015(million yen)

1H FY2016
Share(%)(million yen)

Share(%)

YoY change(%)% ofprojection(%)

Net sales

103,788100.0

112,860

100.0

108.7

101.9

Gross profit

27,33326.3

30,904

27.4

113.1

104.1

SG&A expenses

23,33122.5

24,453

21.7

104.8

98.8

Operating profit

4,002

3.9

6,450

5.7

161.2

130.7

Recurring profit

4,173

4.0

6,647

5.9

159.3

131.3

Net profit

2,586

2.5

4,313

3.8

166.8

133.7

9

2. New Store Openings
1111newnewOTC
OTCstores
storesandand22ethicalethicalpharmacies
pharmacieswere
wereopened
openedNew store openings by area
Kanagawa

OTC
New stores
opened in
1H FY2016

in-store
pharmacies
dedicatedprescription drugstores

600Tokyo

Shizuoka

Chiba

Other

Total

100

200

120

100

1120

Store closing 2 were S&B , 1 was contract expiration
OTC
Total numberof stores as ofthe end of
1H FY2016

in-store
pharmacies
Rate ofpharmacy
establishment
in OTC storesdedicatedprescription
drug stores

Kanagawa

TokyoShizuoka

Chiba

OtherTotal25166781966
122433610455
110

26.3%

24.4%

18.2%

12.5%

27.8%

24.2%

17703229

Reinforcement
Reinforcementof
ofthe
thestore
storedevelopment
developmentsystemsystemwith
withaalarger
largerstaff
staffcharged
chargedwith
withdeveloping
developingstoresstores103. Sales by Segment
1H FY2015

1H FY2016

Sales(million yen)

Share(%)

YoY
change(%)

Sales(million yen)

Medical and healthproducts

23,250

22.4

109.5

25,992

23.0

111.8

(O T C)

17,037

16.4

103.3

18,104

16.0

106.3

(Prescription)

6,213

6.0

131.0

7,888

7.0

127.0

Cosmetics

15,845

15.3

102.9

16,813

14.9

106.1

Food products

39,698

38.2

113.9

43,392

38.4

109.3

Daily products

18,799

18.1

105.3

19,926

17.7

106.0

Other

6,194

6.0

105.4

6,735

6.0

108.7

Total

103,788

100.0

109.0

112,860

100.0

108.7

Share(%)

YoYchange(%)“Other” includes items such as stationery, baby products, clothing, pet products, gardening
products, and film development services.
11

4. Sales
First
Firsthalf
halftotal,
total,YoY
YoY+8.7％+8.7％ vs.
vs.Budget
Budget+1.9％+1.9％ Existing
Existingstoresstores+4.2％+4.2％YoY
YoY
・Food
・Foodproducts
productsand
andprescription
prescriptionsections
sectionsremained
remainedfirm
firmtotopushpushupup
overalloverallresults.
results.
・The・Theunit
unitprice
priceofofproducts
productsrose
roseduedueto
topricepriceperperproductproductbeing
beingcontrolledcontrolledinin
response
responseto
topricepricehikes
hikesininthe
themarket.
market.
・Revitalization
・Revitalizationof
ofexisting
existingstoresstoresby
byRenovation
Renovationand
andexpanding
expandingmerchandise
merchandise
Monthly changes in the existing store sales year-on-year

First half total (Existing stores)

(％)

108.0

106.0

105.1
104.1

104.0

104.4

The impact
from a decline
in June andJuly last year
due to the tax
hike haspersisted.

102.0

Exceptional
demandbrought about
by dengue
fever in
Septemberlast year

・Sale+4.2％ YoY
・Unit price of the customer +1.8％ YoY

105.4

103.4

102.6

100.0
1Q
Existing stores +4.6％ YoY

2Q
Existing stores +3.8％ YoY

98.0
Jun.

Jul.

Aug.

Sep.

Oct.

Nov.

12

4. Sales
Renovation of existing stores
Renovation
Renovationofof2020storesstores・・Revision
Revisionofoffloor
floorspace
spaceallocation
allocationfor
forfood,food,cosmetics
cosmeticsand
anddailydailyproducts
products
・・Expanded
Expandedintroduction
introductionof
ofmeatmeat（（Expanded⇒257
Expandedintroduction
introductionof
ofmeatmeat⇒
257stores
stores1H
1HFY2016FY2016））
・・Change
Changeininmerchandise
merchandiseat
aturban-styleurban-stylestoresstoresDispensing pharmacy
Dispensing
Dispensingexisting
existingstore
store+20.5%+20.5% YoY
YoY
・・Sales
Salesatatdispensing
dispensingpharmacies,
pharmacies,which
whichhave
havebeen
beenopened
openedaggressively
aggressivelyfor
forthethepast
pastthree
threeyears,years,have
havestayed
stayedfirm
firmtotoboostboostoverall
overallsales.
sales.

13

5. Gross profit
GrossGrossprofit
profitmargin
margin27.4％
27.4％
YoY
YoYchangechange+1.1pt+1.1pt vs.
vs.Budget
Budgetchangechange+0.6pt+0.6ptDeployment strengthening of
the nuclear category goods
・Securing・Securingprofits
profitsin
inaagrossgrossmargin
marginmix
mixby
bydeploying
deployingaacombination
combinationof
ofprice-appeal
price-appealandandvalue-appeal
value-appealproducts
products
・Promoting
・Promotingsalessalesby
bydeploying
deployingseasonalseasonalproducts
productsbefore
beforethetheseason
seasonactuallyactuallystarts
starts・Improvement
・Improvementin
inprofits
profitsby
bysettingsettingprices
pricestotomeetmeetmarket
marketprices
pricesSales ratio of dispensing department rises
・Prescription
・Prescriptionsector
sectorwith
withhigh
highprofitability
profitabilitystayed
stayedsteadysteady⇒A⇒Ariseriseininits
itspercentage
percentagein
insalessalespushed
pushedthe
thegrossgrossprofit
profitmarginmarginupward.
upward.
14

6. Prescription Section
1H FY2016(million yen)

Net sales
Gross profit

7,888
3,165

Share(%)

100.0

YoY
change(%)

127.0

Existing
ExistingstoresstorescomparisonscomparisonsSales+20.5%
Salesyear-on-yearyear-on-year+20.5%
Prescription
Prescriptionyear-on-yearyear-on-year +12.9%+12.9%
Sales in prescription operations and the number ofLine graph:prescriptions issued
Number of prescriptions issued(unit: 10,000)

Bar graph: Sales(unit : hundred million yen)

200

40.1

191

123.9
180

180

158

160

・Promotion
・Promotionof
ofgenericgenericproductproductusage
usage
Usage
Usagerate
rateisis61.3%
61.3%(quantity(quantitybasis)
basis)
・Promotion
・Promotionofofmedication
medicationguidance
guidance
bybyvisit
visitCollaboration
Collaboration
withwith7070nursing
nursingfacilities
facilities(demandfrom5new(demand from 5 newfacilitiesfacilities))

160

125

140

140

106

120
100

200

120

92

168

100

137
80

80
104

60

82

60

68

40

40
FY2012FY2013

FY2014FY2015FY2016（projection）

15

7. SG&A Expenses
FirstFirsthalf
halftotal,
total,YoY
YoY+4.8％+4.8％ vs.
vs.Budget
Budget-1.2％-1.2％
Operating within the plan by making efforts to reduce various costs
Utilities expenses vs. Budget -10.5％
・Curbing electricity consumption by shifting store lighting to LED andtaking power-saving measures in stores・ A reduction in fuel adjustment cost unit price due to falling oil prices
Personnel expenses vs. Budget -0.5％

・Overtime and reduction of by reviewing and review of staffing of work
Building expenses
Restrained any increase in construction costs by reviewing store
specifications and competitive bidding to cope with the rise inconstruction materials and labor costs
16

FY2016 consolidated The
second half of the efforts

171. Active investment for growth and efficiency
ActivationActivationof
ofexisting
existingstoresstoresExpansion of assortment
・Expansion
・Expansionof
ofmeatmeatandandfruit
fruitandandvegetable
vegetableassortment
assortment
・・Enhancement
Enhancementof
offrozenfrozenfoods
foodsandanddailydailydelivereddeliveredgoods
goodsassortment
assortment
・・Refurbishing
Refurbishinglarge
largestoresstoreswith
withananemphasis
emphasison
onfoodfood・・Introduction
Introductionof
ofsundrysundrygoods
goodsthatthathave
havenot
notbeenbeen
dealt
dealtwithwithbefore
beforeRenewal of fixtures and equipment
・・Renewal
Renewalof
ofLED
LEDlighting
lightingand
andfurniturefurnitureof
ofcosmetics
cosmetics
department
department
・・Review
Reviewof
offurniture
furniturespecification
specificationof
ofdaily
dailynecessities
necessities
department
department
18

1. Active investment for growth and efficiency
Renovation of the store equipment
・・Making
Makingadditional
additionalinvestment
investmentto
toshift
shiftstore
storelighting
lightingto
toLED
LED
・・Increase
Increasein
inworkworkefficiency
efficiencydue
dueto
tothe
theexpansion
expansionof
offixtures
fixtures・・Maintenance
Maintenanceofof store
storeinterior
interiorandandsignage,
signage,parking
parkinglot
lotStore renovation and capital investment of pharmacy
・・Efficiency
Efficiencyup
upby
byinvestment
investmentof
ofdispensing
dispensingequipment
equipment
・・Expansion
Expansionof
ofexisting
existingpharmacy
pharmacy
・・New
Newinstallation
installationof
ofin-homein-homebases
basesandanddispensing
dispensingtraining
training
centers
centers19

2. Promotion of pharmacies supporting
customer health
Personal pharmacies
・Development
・Developmentof
ofhumanhumanresources,resources,improvement
improvementofoftraining
trainingcontent
content
・・Improvement
Improvementof
ofoperations
operationsby
byinvestment
investmentin
inequipment
equipment
・・Strengthening
Strengtheningcooperationcooperationwith
withlocal
localmedical
medical・・Strengthening
Strengtheningmedication
medicationguidelines
guidelinesby
byvisits
visitstotoindividual
individualhomes
homes・・Upgrading
Upgradingthe
thecontent
contentof
ofhealth
healthconsultation
consultationmeetings
meetings
andandconducting
conductingaapilot
pilotintroduction
introductionof
ofbloodbloodtests
tests

University Hospital before the pharmacy
・Opening
・Openingdispensing
dispensingpharmacies
pharmacieswith
withaasterilesterilepreparation
preparation
room,room,also
alsocapable
capableof
ofrendering
renderingin-homein-homeservices
services
・Expansion
・Expansionand
andimprovementimprovementof
ofvenues
venuesforforclinicalclinicaleducation
educationforforpharmacists
pharmacists20

FY2016 Forecasts(Consolidated)

21

FY2016 Forecasts (Consolidated)
FY2015(consolidated results)(million yen)

Share(%)

FY2016(consolidated projection)(million yen)

Share(%)

YoY
Change (%)

Net sales

213,918100.0

227,300

100.0

106.3

Gross profit

57,51626.9

61,000

26.8

106.1

SG&A expenses

46,78721.9

49,860

21.9

106.6

Operating profit

10,728

5.0

11,1404.9

103.8

Recurring profit

10,982

5.1

5.0

103.8

Net profit

6,5613.1

11,400
7,030

3.1

107.1

Full-year
Full-yearforecast
forecastwill
willnotnotbe
bechangedchangedat
atthisthistime.
time.
The
Thewatching
watchingfuture
futureperformance
performancetrends,
trends,ififititis
isdetermined
determinednecessary
necessarytotocorrect
correctthethepromptly
promptlydisclose.
disclose.
22