Results briefing for the six
months ended July 31, 2013
September 4, 2013

(Securities code: 7956)
President & COO Shigeru Yamashita© All rights reserved by PIGEON Corporation

Contents

 Title, Contents

1-2 Jul. 2013 Results

3 - 14

 Jan. 2014 Full Year Business Forecasts

15 - 19© All rights reserved by PIGEON Corporation

2

Jul. 2013 Results© All rights reserved by PIGEON Corporation

3

Jul. 2012 Results and Jul. 2013 Results (Consolidated)Jul. 2012(¥ millions)

AmountJul. 2013
YoY Change

AmountYoY Change

Net sales

31,207109.8 %

36,621117.3 %

Operating income

3,225154.5 %

4,814

149.3 %

3,266

158.2 %

5,161

158.0 %Net income

1,910

157.3 %

3,121

163.3 %Net assets

29,165107.0 %

36,078123.7 %

Total assets

45,541103.0 %

53,349117.1 %EPS (¥)

47.73※－77.98※163.4 %BPS (¥)

728.63※－820.97※112.7 %

Ordinary income※The Group conducted a stock split at the ratio of 2 shares for every 1 share of common shares. The effective date of the stock split was August 1, 2013. Net income
per share and net assets were calculated assuming that the stock split was performed at the beginning of the previous fiscal year ended January 31, 2013.

© All rights reserved by PIGEON Corporation

Statements of Income (Consolidated)Jul. 2012(¥ millions)

AmountJul. 2013% of Total

Amount% of Total YoY Changesummary

Net sales

31,207100.0 %

36,621100.0 %

117.3 %

Cost of sales

17,96057.6 %

20,45755.9 %

113.9 %

Gross Profit

13,24742.4 %

16,16444.1 %

122.0 % ■Main SG&A changes

Selling, General and
Administrative Expenses

10,02232.1 %

11,35031.0 %

113.3 %

Operating income

3,225

10.3 %

4,814

13.1 %

149.3 %

Total Other Income andExpenses

41

0.1 %

347

0.9 %

842.0 %

Ordinary income

3,266

10.5 %

5,161

14.1 %

158.0 %

Total Extraordinary
Income and Loss(21)(0.1 %)

(12)

0.0 %

―Less: Minority Interest in Net
Income of Consolidated
Subsidiaries

59

0.2 %

86

0.3 %

146.6 %

1,910

6.1 %

3,121

8.5 %

163.3 %Net income© All rights reserved by PIGEON Corporation

Personal expenses:＋ ¥ 494m
Advertising expenses : ＋ ¥ 221m
Delivery expenses:＋ ¥ 134m■Main changes in Total Other
Income and Expenses
Foreign exchange gains + ¥ 178m5Results by Segment (Consolidated)Jul. 2012

Jul. 2013(¥ millions)
Amount% of
Total

Gross
MarginSegment
IncomeAmount% of
Total

YoY
ChangeGross
MarginSegment
IncomeConsolidated
net sales

31,207100.0%

42.4%

3,225

36,621100.0%

117.3%

44.1%

4,814

Domestic Baby andMother Care
Business

11,954

38.3%

47.1%

1,784

12,47634.1%

104.4%

45.9%

1,628

Child-rearing
Support Services

3,159

10.1%

11.5%

83

3,289

9.0%

104.1%

11.4%

80

Health Care andNursing Care
Business

3,510

11.2%

31.0%

130

3,449

9.4%

98.3%

31.1%202

Overseas Business

12,013

38.5%

50.5%

2,697

16,85546.0%

140.3%

52.9%

4,666

570

1.8%

15.7%

74

550

1.5%

96.6%

14.4%

63

Other

※Segment income in consolidated amount (all unclassifiable operating expenses)
has been adjusted and posted as operating income in the quarterly consolidated statements of income© All rights reserved by PIGEON Corporation

6

Overseas Business Sales by Region(¥ millions)
China

Oth er Asia(e xc ept China)

North Am erica

Middle East

OtherLocal currency basis: +122.0%

967

9,265

J ul2013

2,950

2,567

16,855
1,104

Local currency basis: +119.6%

801
6,195

J ul2012

2,318

12,013

1,789
907

0

4,000

8,000

12,00016,000※ Currency rates (July 2013): US$1 = ¥95.72; 1 yuan = ¥15.49; (July 2012): US$1 = ¥79.77; 1 yuan = ¥12.64© All rights reserved by PIGEON Corporation7

Key Priorities for Year to Jan. 2014
■ Domestic Baby and Mother Care Business- Steady growth and expansion of large merchandise business by launching new products- Establishment of new category“Pigeon for over 18 months old” series and “women's wellness” category■ Child-rearing Support Services- Realize further improvements in child-rearing quality and efficient business management■ Health Care and Nursing Care Business- Reconstruct business organization and improve the profitability; reinforce sales activities forthe facilities route- Realize the strategy for growth with the main products as the key■ Overseas Business- China :Launch the products of new category
Achieve further reinforcement of the brand power by increasing intensive promotion
hospitals, etc.
- Europe and America: Launching new products and steady growth of the brands (mOmma, etc.)- Market expansion: Growth of the market share in India, Malaysia, South Korea and entry newmarket.

© All rights reserved by PIGEON Corporation

8

Domestic Baby and Mother Care Business / Child-rearing Support Services■ Domestic Baby and Mother Care Business[New products for babies released in the first half of the year]“Bonyu Jikkan ”Baby Bottles with design, “UV Baby Series”, etc.
[New products in the "women’s wellness" category released in the first half of the year]“Gel Toothpaste ", "Mouthwash" "Oral Tablet"[Large merchandise business]
Stroller "Mahalo"[Direct communication]20 maternity events with participation of about 1,400 people■ Child-rearing Support Services[New additions of facilities managed]
2 national hospital organizations and 3 child-care facilities in businessestablishments -> Total 189 facilities
Main products to be launched during the Autumn of 2013(second half of the year)

Market Share by Product (Jul. 2013)

nts

Un

derw
ea

rdetergee

wipe

arbyBaSkinc

Babyfoodag
Mdsag
Mpa

ri lizer

eastyBrsteleter
debottBabybottniplelebott

bott

Bab

BabyBabyplegentsles100.0%
90.0%
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0%

Baby wips

Supplement for pergnant
women (folic acid, ironand Calcium )Manual BreastPump※Source: POS Nationwide Drugstore Growth Estimates, INTAGE Inc. (monthly data)© All rights reserved by PIGEON Corporation

9

Health Care and Nursing Care Business■Health Care and Nursing Care Business

Habinurse

Recoup・ Focus on Pigeon Tahira (agent for distribution to healthcare facilities)
・ Walking aid products: wheelchair sales are strong
・ “Kaori Kakumei" sales are strong
・ The users of the Pigeon Manaka day service increase smoothly

・ New products renewed: “Walking Support Shoes”
・ Expanding sales through catalog mail orders and TV shopping

Recoup " Burden Reducing Supporter"© All rights reserved by PIGEON Corporation

Habinurse "Kaori Kakumei“(Deodorant)

Pigeon Manaka day service "Sansan"

10Overseas Business■Overseas Business

China・Successfully continued to release into the market new products and sales are also progressing favorably
・Production output is increasing in two production facilities due to business expansion, making contributions
to the profits
・Our awareness program related to caring for breastfed infants conducted jointly with our Sanitation department
is continually being implemented
・Strong efforts are made on promotion activities (such as holding events offering hand-on experience inchildcare,others)

Europe and America

・Restructuring of personnel affairs and efforts to strengthen marketing activities bore fruit with business resultson the upward trend
・Focus on penetration of “mOmma” brand

New markets

・ India: continued efforts to strengthen distribution system, increase the number of shops selling the Group’s
products, and installation of Pigeon Corners
・Korea: To strengthen the structure for business expansion already achieved last year, a sales branch was
reorganized into a local corporation

China: new disposable diapers© All rights reserved by PIGEON Corporation

China: an event offering hand-on
experience in childcare

India: Pigeon Corner11

Reference: Balance Sheet Highlights (Consolidated)
Jan. 13
AmountAmountJul. 13(¥ millions)YoY Change(Amount)

YoY Change(%)

Cash and time deposit

10,574

9,086(1,487)

85.9 ％Notes and accounts
receivable

10,54012,840＋ 2,299

121.8 ％

Inventories

6,776

7,983＋ 1,206

117.8 ％

Notes and accounts payable

3,864

4,728＋ 864

122.4 ％

Borrowings

3,620

3,447(173)95.2 ％Net assets

32,36536,078＋ 3,712111.5 ％

Total assets

48,53853,349＋ 4,811109.9 ％

Equity ratio

65.3%

66.1%

－＋ 0.9 pt■ Notes and accounts receivable:■ Inventories:© All rights reserved by PIGEON Corporation

Increase due to business expansion

12Reference: Cash Flows(¥ millions)
1,810(2,360)

10,574(1,731)
1,883 (1,104)792

9,086(830)
64

7,293

7,306
Acquisition of PPE: ¥(2,310) m(Jul. 12: ¥(997) m)

Income before income taxes: ¥5,149 m(Jul. 12: ¥3,244 m)
Decrease (increase) in trade receivables: ¥(1,397) m(Jul. 12: ¥(1,139) m)

Loan income/repayments: ¥ (254) m(Jul. 12: ¥(87) m)
Payment of cash dividends: ¥(1,418) m(Jul. 12: ¥(880) m)

Jul. 2012
Balance at Operating
Beginning Activities

7,293

1,883

Jul. 2013

Investing
Activities

Financing Translation/Valu Balance
Activities ation Gain (Loss) at End(1,104)(830)© All rights reserved by PIGEON Corporation

64

7,306

Balance at Operating
Beginning Activities

10,574

1,810

InvestingActivities(2,360)Financing Translation/Valu
Activities ation Gain (Loss)(1,731)

792

Balanceat End

9,086

13

Reference: Investment-Related Indicators(Consolidated)(¥ millions)Jan. 2013

Jan. 2014

Interim(Result)

Full Year(Result)

Interim(Result)

Full Year(Plan)

Capital expenditures ※1872

1,868

2,092

4,517

Depreciation(tangible fixed assets)

681

1,426733

1,632

Research and development ※2766

1,620

820

1,771

※1 Refers to purchase of tangible fixed assets, excluding construction in progress※2 Refers to total R&D expenditures, including personnel-related© All rights reserved by PIGEON Corporation

14

Jan. 2014 Full Year Business Forecasts© All rights reserved by PIGEON Corporation

15

Jan. 2013 Results and Jan. 2014 Forecast (Consolidated)
Jan. 2013(¥ millions)

AmountJan. 2014 (Revised Forecast)% of Total

YoY Change

65,075100.0%

110.0%

7,086

10.9%

7,389

Net income% of Total

YoY Change

76,600100.0%

117.7%

140.5%

9,000

11.7%

127.0%

11.4%

150.3%

9,300

12.1%125.9%

4,573

7.0%

143.7%

5,600

7.3%

122.4%Net assets

32,365－115.9%

37,283－115.2%

Total assets

48,538－110.9%

54,760－112.8%EPS (¥)

114.26※－－139.90※－122.4%BPS (¥)

791.24※－－912.64※－115.3%

ROA

16.0%

－

－

18.0%

－－

ROE

15.5%

－

－

16.4%

－

－

Net sales
OperatingincomeOrdinary
incomeAmount※ ROA = Ordinary income ÷ Total assets; ROE = Net income ÷ Equity (in both cases, denominators are averaged between beginning and year-end figures)※The Group conducted a stock split at the ratio of 2 shares for every 1 share of common shares. The effective date of the stock split was August 1, 2013. Net income per share and net
assets were calculated assuming that the stock split was performed at the beginning of the previous fiscal year ended January 31, 2013.

© All rights reserved by PIGEON Corporation

16

Results and Forecast by Segment (Consolidated)
Jan. 2013

Jan. 2014 (Revised Forecast)(¥ millions)
Amount

% of
Total

Gross
MarginSegment
IncomeAmount

% of
Total

YoY
ChangeGross
MarginSegment
IncomeConsolidatednet sales

65,075100.0%

42.7%7,086

76,600100.0%

117.7%

42.9%

9,000

Domestic Baby andMother Care
Business

23,882

36.7%

46.8%

3,379

24,95632.6%

104.5%

45.6%

3,595

Child-rearing
Support Services

6,388

9.8%

11.4%

182

6,434

8.4%

100.7%

11.7%

202

Health Care andNursing Care
Business

6,699

10.3%

30.6%

212

7,000

9.1%

104.5%

30.7%

375

Overseas Business

26,964

41.4%

50.6%

6,387

37,25748.6%

138.2%

50.4%

9,315

Other

1,140

1.8%

15.2%

141

950

1.2%

83.3%

15.6%

118

※Segment income in consolidated amount (all unclassifiable operating expenses)
has been adjusted and posted as operating income in the consolidated statements of income※Assumed exchange rates of Overseas Business: US$1 = ¥92.00 ; 1 yuan = ¥14.80© All rights reserved by PIGEON Corporation

17

Full Fiscal Year Overseas Sales by Region(¥ millions)
Ch in aOth e r Asia(e xc e pt Ch in a)

No r t h Am e r ic a

OtherMiddle East1,872
J an2014(R ev i s edF oreca s t)

21,973

6,544

4,737

37,2572,129

1,878
J an2013( R es ul t)

14,112

26,964

5,243 3,6682,062

0

10,00020,00030,00040,000※ [Currency rates] Jan. 2014 (assumed): US$1 = ¥92.00; 1 yuan = ¥14.80; Jan. 2013: US$1 = ¥79.80; 1 yuan = ¥12.66© All rights reserved by PIGEON Corporation18

Shareholder Return and Investment-Related Indicators[Shareholder return indicators under Fourth Medium-TermBusiness Plan]
・ Adopt flexible approach to upgrading shareholder return(incl. through share buybacks), targeting continued total
shareholder return ratio of 50% or higher
Dividend Status

Dividend per share(yen)Payout ratio

Jan. 2011 (Result)Jan. 2012 (Result)Jan. 2013 (Result)Jan. 2014 (Forecast)InterimYear-EndInterimYear-EndInterimYear-EndInterimYear-End

4444444444716637(74)

60.1%

55.3%

50.3%

※50.0%※The Group conducted a stock split at the ratio of 2 shares for every 1 share of common shares. The effective date of the stock split was August 1, 2013.
The stock split is reflected in the amount of the listed year-end annual dividends for the year ending January 31, 2014 (forecast).

© All rights reserved by PIGEON Corporation

19Corporate Overview
PIGEON CORPORATIONHead office4-4, Nihonbashi-Hisamatsucho, Chuo-ku,
Tokyo
103-8480, Japan
Tel: +81-3-3661-4200+81-3-3661-4188 (Investor Relations)Fax:+81-3-3661-4320
E-mail address
InvestorRelations＠pigeon.com

URL http://www.pigeon.co.jp /http://english.pigeon.co.jp/
In this document, statements other than historical facts related to plans, forecasts,
and strategies are based on information available at the time of writing.
The Corporation cannot provide guarantees or commitments for these forwardlooking statements.
Due to various factors, actual results may differ significantly from those anticipatedin this document.

© All rights reserved by PIGEON Corporation20