2023/2024
ANNUAL RESULTS
HONMA GOLF LIMITED (6858.HK)
Jun. 2024

ONE OF THE MOST PRESTIGIOUS AND ICONIC BRANDS IN THE GOLF INDUSTRYDISCLAIMER
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02

2023/2024 ANNUAL RESULTS

01

HONMA

02

PERFORMANCE OVERVIEW

03

BUSINESS HIGHLIGHT

04

FINANCIAL REVIEW05

OUTLOOK

06

APPENDIX

03

01

HONMA

#1 PREMIUM GOLF BRAND FOUNDED IN JAPAN IN 1959
67 YEARS OF DEDICATIONS TOWARDS QUALITY AND CRAFTSMANSHIPTHE ONLY VERTICALLY INTEGRATED GOLF COMPANY IN THE WORLD

IN-HOUSE R&D AND
CLUB MANUFACTURINGCOMPREHENSIVE CLUB AND
NON-CLUB PRODUCT PORTFOLIOEXTENSIVE DTC +DISTRIBUTION NETWORK• 200 R&D personnel and skilled craftsmen• Diversified range of premium golf products• Club portfolio focusing on super-premium and• Presence in over 50 countries• Unique omni channel, 95 self-operated

operating out of 163,000 m2 of manufacturingbase in Sakata, Japan• Advanced and sophisticated design andmanufacturing capacity, housed under one roof

2023/2024 ANNUAL RESULTS

premium-performance consumer segments• Comprehensive range of non-club products
including balls, apparels and accessories

stores overlayed with 3,713 third party
POSs• Fast growing E-commerce business in
China, Japan and the US

05

02

PERFORMANCE OVERVIEWIn FY2024, the golf industry witnessed increased market competition and adjustments in both participation and willingness to pay resulting from global
economic situations and slowdowns in certain parts of the world.
Despite unfavorable market conditions, HONMA continued to drive profitable sales growth, re-strategised its distribution channel to grow profitable sales andachieved robust bottom line growth as well as net margin improvement, reconfirming HONMA’s brand equity and resilience.

KEY FINANCIALS

Full Year Ended 31 Mar 2024

Change vs Full Year Ended 31 Mar 2023

Net Sales

JPY 26,223 MM / USD 182.6 MM (1)-11.1%(constant currency: -12.8%)

51.2%+0.4pp

EBITDA- EBITDA Margin

JPY 7,285 MM / USD 50.7 MM (1)27.8%+22.0%+7.5ppNet Profit- Net Profit Margin

JPY 4,828 MM / USD 33.6 MM (1)18.4%+48.3%+7.4pp

JPY 7.97 / 0.43 HKD (3)+48.3%Net Operating Cash Flow

JPY 5,416 MM / USD 37.7 MM (1)+47.3%Net Cash Position

JPY 9,627 MM / USD 64.0 MM (2)+41.7%

Proposed Dividend

Proposed Final: JPY 1.50 /share
Declared Interim: JPY 1.50 /share(Full Year Dividend Ratio: 37.6%)

Gross Profit Margin

Reported Earnings Per Share

Note (1) Exchange rate: 1 USD = 143.62 JPY

2023/2024 ANNUAL RESULTS(2) Exchange rate: 1 USD = 150.45 JPY(3) Exchange rate: 1 HKD = 18.35 JPY

07

PERFORMANCE OVERVIEW BY MARKETFY24 NET SALES: JPY 26,223 MM / USD 182.6 MM, -11.1% YOY (COMPARABLE -12.8%)•

The decrease in Japan and Korea was attributed to channel optimization in both markets to allow for a better focus on and service to the larger and more relevant retailers.
This has led to temporary sales decline from distributors and wholesalers yet profitability and cashflow improved.

•

China experienced a slight decline of 3.7% as the overall economy and retail market sentiment continued to experience downward pressure.

NET SALES MIX BY MARKET%

2.4%

NET SALES GROWTH BY MARKET(nominal/comparable)

1.4%-18.3%/-28.6%(2)EUROPE

9.0%
35.7%

22.8%

28.6%

SALES: JPY362M /USD 2.5 M-4.7%/-4.7%-3.7%/-6.3%
CHINA(INCL. HK&MACAU)SALES: JPY 7,508 M /USD 52.3 M-28.7%/-32.3%(3)JAPAN

SALES: JPY 9,363 M /USD 65.2 M-15.5%/-16.8%(1)-38.2%/-42.0%(2)NORTH AMERICA
SALES: JPY 633.0 M /USD 4.4 M

SOUTH KOREA

SALES: JPY 5,989 M / USD
41.7 M

OTHER REGIONSJapan

SALES: JPY 2,368 M /USD 16.5 M

China(Including Hong Kong and Macau)
Korea
Other Regions
North America
EuropeNote (1) Sales from South Korea recorded a first time decline of 15.5%, mainly due to the Group’s decision to
optimize its distribution network prior to its new products launch in the first quarter of 2024.
Note (2) North America and Europe recorded decline in sales by 38.2% and 18.3%, respectively, due tocontinued negative impacts from last year’s adjustments in distribution network; such adjustments aim tofocus on a smaller yet premier group of accounts
Note (3) Sales from Other Regions dropped by 28.7%, mainly due to unfavourable local currency depreciation
against U.S. dollar and weakened purchasing interest and power

2023/2024 ANNUAL RESULTS

08

PERFORMANCE OVERVIEW BY PRODUCT CATEGORY
FY24 NET SALES: JPY 26,223 MM / USD 182.6 MM, -11.1% YOY (COMPARABLE -12.8%)•

Although facing multiple challenges within the industry, revenue fromBERES golf clubs rose by 19.6% in Japan and revenue from BeZEAL 3 went
up by 6.0 times across different markets, reconfirming HONMA’s strong
brand equity and its ability to withstand economic challenges.

GOLF CLUBSNET SALES -15.1% TO JPY 18,257 MILLION / 127.1 USD MMGROSS MARGIN +0.9PP TO 60.3%•

net sales came down mainly due to economic instability and adjustments in
HONMA’s distribution strategies in Japan and Korea.

•

gross profit margin went up thanks to continued price management andmanufacturing cost improvements.

•

Apparel sales went up by 4.9% while gross profit margin increased 16.8PP
to 43.5% thanks to successful new product launches, as well as continued
marketing and branding campaigns to drive consumer awareness.

•

Sales from golf balls slightly decreased because of upward priceadjustment in the face of continued currency pressure.

APPARELSNET SALES MIX BY PRODUCT CATEGORIES•NET SALES +4.9% TO JPY 3,158 MILLION / 22.0 USD MMGROSS MARGIN +16.8PP TO 43.5%

%

7.2%

GOLF BALLS

11.2%

12.0%

apparel sales in mainland China up by 23.2% in spite of overall
weakening in consumer sentiments.

69.6%

Golf Clubs

NET SALES -0.2% TO JPY 2,936 MILLION / 20.4 USD MMGROSS MARGIN -5.9PP TO 23.4%

Apparels•

Golf Balls
Accessories & Other
Relateddown due to temporary impact from following upward retailprice adjustment to cope with Japanese Yen depreciation in
Japan.

ACCESSORIESNET SALES -7.8% TO JPY 1,872 MILLION / 13.0 USD MMGROSS MARGIN -7.5PP TO 19.6%•
2023/2024 ANNUAL RESULTS

primarily caused by constrained sales in Japan to protect margin.
09

PERFORMANCE OVERVIEW BY CHANNEL
FY24 NET SALES: JPY 26,223 MM / USD 182.6 MM, -11.1% YOY (COMPARABLE -12.8%)
NET SALES MIX BY CHANNEL%

DIRECT-TO-CONSUMER CHANNELSNET SALES +7.2% TO 10,952 JPY MILLION / 76.3 USD MMGROSS MARGIN +7.0PP TO 56.8%

41.8%

58.2%

95

SELF-OPERATED STORES

E-COMMERCE
Distributors
DTC Channels•••

Net +5 new locations, mainly located on prime golf courses in China
Sales from Japan +16.0%; sales from Mainland China +15.7%
Continued optimization of design, merchandising and consumer experience•••

Operating in China, Japan and the US
Total net sales +17.4%
Robust sales growth in all 4 markets: China +15.3%, Taiwan +83.0%, Japan+16.3%, US +32.3%

3rd PARTY RETAILERS AND WHOLSALERS
NET SALES -20.8% TO JPY 15,271 MILLION / US 106.3 MM
GROSS MARGIN -4.1PP TO 47.2%
3,713
3RD PARTY POSs

2023/2024 ANNUAL RESULTS•

Sales decreased primarily due to weakened economic environment in China and a
refocus of HONMA’s distribution footprint in multiple markets, esp. Korea with athird-party POSs decrease by 51.

10

03

BUSINESS HIGHLIGHT

HONMA GROWTH STRATEGY: “Single brand, Multi-categories & Asia-focused”
The Group strategically focuses on the development of its home markets in Asia and the marketing of its exquisite product offerings targeting super-premium and premium-performancesegments.

the THREE PILLARs of HONMA’s GROWTH STRATEGYPRODUCTCHANNEL

BRANDING AND CONSUMER ENGAGEMENT• Combines top-notched Japanese craftsmanship• Continuously upgrading HONMA’s retail presence• Re-defining HONMA brand as a dynamic, relevant

GOLF CLUBS
with world standard innovative technologies• Strengthened focus on super-premium andpremium-performance segments• Enrichedpremium-performance
products
targeting golfers with 8-20 handicaps• Unique product offerings designed for social
media savvy female golfers

NON-CLUB PRODUCTS• Steady advancement of ball and accessory
businesses in premium consumer segments• Nurturing apparel business in the fast growing

home markets, aiming both golfers, as well as awider spectrum of active and outdoor-inspired
populations

2023/2024 ANNUAL RESULTS

with primer locations, new retail visual identity,
design concept and consumer experienceelements• Further penetration into premium-performancesegment by adding quality retailers and POSs

• Continue investing into the brand’s digital eco-system and HONMA’s private sphere, following
fundamental change in consumer behavior andbusiness environment post COVID-19

and premium golf lifestyle brand among younger
and internet-savvy golfers.

• Offering 360 degree HONMA brand experience

across all consumer touch points both offlineand online, pursuing golfers in super-premiumand premium-performance segments• Rejuvenated TEAM HONMA with younger anduprising athletes, coaches and influencers tocreate a unique community culture• Enhanced CRM system to better understandconsumers and nurture loyalty• Focused marketing and PR activities across all
markets

12

PRODUCT: Unique CLUB PORTFOLIO representing Japanese craftsmanship and innovative technology
FOCUSING ON SUPER-PREMIUM AND PREMIUM-PERFORMANCE CONSUMER SEGMENTS
SUPER-PREMIUM

PREMIUM-PERFORMANCEOTHER CLUB PRODUCTS
PUTTERS, COUNTRY SPECIFIC MODELS,
SPECIAL EDITIONSBERES 09
Launched in Feb 2024

TW767
Coming in late 2024

BeZEAL 3
Launched in Feb 2024

FOR BEGINNERS IN KOREAHANDICAP 20-25
BERES NX
Launched in Nov 2022

2023/2024 ANNUAL RESULTS

TW757
Launched in Mar 2022

SAKATA LABNAVIGATION Putters
Launched in Dec 2023

FOR SERIOUS GOLFERSHANDICAP 0-12

FOR YOUNGERFEMALE GOLFERS

13

PRODUCT: Unique CLUB PORTFOLIO representing Japanese craftsmanship and innovative technology
FOCUSING ON SUPER-PREMIUM AND PREMIUM-PERFORMANCE CONSUMER SEGMENTS•

The newly launched BERES 09 and BeZEAL 3 has achieved great success, reconfirming HONMA’s strong brand equity, and its ability to withstand economic challenges•

In FY2024, golf club sales -15.1% to JPY 18,257 million, mainly due to phase out of BERES Aizu and TW757, and third-party channels optimization•

Overall club gross margin +0.9 pp to 60.3%, primarily due to continued price management, manufacturing cost improvements and channel optimization

BERES

PRODUCT LAUNCH• BERES 09 released globally in Feb
2024

TOUR
WORLD

• 2-proned product approach designed• Country specific models, special• Next generation of Tour World to be••• 9.4% of club sales• FY24 sales -46.8% mainly due to• 36.0% of club sales• FY24 putters sales +19.6%, sales

for avid golfers with single and double
handicaps respectively
released in late 2024

SALES PERFORMANCE• 54.7% of club sales• FY24 sales -9.8%, mainly due to

BERES Aizu phase out and weak
consumer sentiment in China.
However, revenue from BERES golf
clubs in Japan +19.6% since the new
BERES 09 launched

2023/2024 ANNUAL RESULTS

OTHERS

TW757 phase out and distribution
optimization in several markets•

editions and putters
BeZEAL 3 released in Feb 2024
SAKATA LAB PUTTERS released in
Dec 2023

from BeZEAL 3 rose by 6.0 times
All-time favorite to consumers who
are looking for extinguished andexquisite cosmetics

14

PRODUCT: Continued pivoting sales growth in golf balls
UPWARD RETAIL PRICE ADJUSTMENT TO FURTHER STRENGTHEN BALL’S PRODUCT PYRAMID•

Golf ball sales declined marginally by 0.2% YOY to JPY 2,936 million; gross margin decreased by 5.9PP to 23.4% following continued currency depreciation and cost pressure.

•

Sales from golf ball declined due to upward retail price adjustment, implemented to cope with Japanese Yen depreciation over the last few years. Gross profit margin continued to be underpressure.

•

Golf ball sales from SEA and China + 62.7% and + 9.4% respectively.

PRODUCT PYRAMID
Premium
Performancedriven
Value
D1, 2-LAYER BALLTOTAL GOLF BALL SALESJPY MM

R
7-YEA
1,805
736

FY17

TW-X, TW-S , 3-LAYER BALL

BERES 5 STAR, 6-LAYER BALL

JAPAN GOLF BALL SALES
.9%
1
2
+
:
C AG R

2,211

2,659

JPY MM

2,974

2,947

R
7-YEA

2,936

C

.6%
0
3
+
:
AG R

1,737

1,810

1,926

FY20

FY21

FY22

2,434

2,400

FY23

FY24

1,209

1,148

787
370

FY18

FY19

2023/2024 ANNUAL RESULTS

FY20

FY21

FY22

FY23

FY24

FY17

FY18

FY19

15

PRODUCT: Nurturing apparel business to build a leading golf lifestyle brand
APPAREL SALES +4.9% YOY TO JPY 3,158 MILLIONGROSS MARGIN +16.8 pp TO 43.5%

APPAREL COLLECTION CONSISTING OF 3 DISTINCTIVE PRODUCT LINES TARGETINGPREMIUM PERFORMANCE AND FASHION ATHLETIC CONSUMER SEGMENTS• Sales from mainland China +23.2%; sales from SEA +618.8%,
mainly due to entry into Indonesia• 3 product lines catering to the distinctive requirements ofgolfers and outdoor enthusiasts in Asia, both on-course andoff-course• Quality retail footprints with optimized store operation,

PROFESSIONAL GOLF LINE
Tour-inspired professional golf wear
featuring high-tech functional fabrics
and 3D synchronized cutting

merchandise planning and upgraded display• Continued investment into digital marketing and Ecommerce capabilities on the back of one digital eco-system• Crossover collections collaborating with trendy Japanesedesigner and iconic IP to drive brand awareness and appeal
to the younger generation

FASHION GOLF LINE
Tour-inspired professional golf wear
featuring high-tech functional fabrics
and 3D synchronized cutting

URBAN ATHLEISURE LINE
Trendy athleisure wear targeting
active and outdoor enthusiasts,
featuring fashionable and diverse
designs and details

2023/2024 ANNUAL RESULTS

16

CHANNEL: 360-degree brand experience built into new retail space and environments
DIRECT-TO-CONSUMER RETAIL CHANNELSACT AS BRAND EXPERIENCE HUBS ACROSS ALL MARKETS• Sales from self-owned channels +7.2% to JPY 10,952 million• Retail sales from Japan +16.0%; sales from mainland China +15.7%• 95 self-owned stores, net increase by 5; newly opened 17 stores, all of which are in Asia

THIRD-PARTY RETAILERS AND WHOLESALERS
FOCUS ON A SMALLER BUT PREMIER GROUP OF ACCOUNTSAND CONTINUED TO DRIVE PENETRATION• Sales from third-party -20.8%• Number of POSs declined by 4 to 3,713, esp. in Korea, with a third-party POSs
decrease by 51.

• Sales decline was primarily due to sales decrease in Japan, Korea, and China(including HK and Macau), mainly due to continued distribution footprint
optimization

2023/2024 ANNUAL RESULTS

17

CHANNEL: Further expanding digital eco-system and private sphere to boost consumer loyalty
FUELED BY UP-TO-DATE CONTENT MARKETING ON SOCIAL MEDIA AND CRM PLATFORMS
E-COMMERCE SALES GREW BY 17.4%
DRIVEN BY ACCELERATED INVESTMENT IN DIGITAL
MARKETING WITH A FULL-CHANNEL APPROACH

T-MALL FLAGSHIP STORE

US E-COMMERCE SITEWECHAT OFFICIAL ACCOUNT & STORE

JAPAN E-COMMERCE SITE

• E-commerce platforms in major markets••

China: Tmall, JD, Wechat Store, Douyin, and DU, newly opened theRED
Japan & US: self-operated E-commerce site

• Actively pursuing an E-commerce growth strategy on open and private

platforms• Dedicated E-commerce team and marketing resources• Social media campaigns generating traffic to online stores• Search engine optimization and in store visual updates• Full channel CRM system to upgrade loyalty program and improve
consumer experiences• Livestream sales campaign to attract internet-savvy consumers in
China

2023/2024 ANNUAL RESULTS

18

MAKETING: Re-defining HONMA as a dynamic, relevant and premium golf lifestyle brand
CONTINUOUSLY DRIVE BRAND AWARENESS ACROSS ALL MARKETSDIGITALIZED CONTENT MARKETING THROUGH RELAUNCHED GLOBALWEBSITE & SOCIAL MEDIA PLATFORMS RELEVANT TO EACH MARKET• Frequently updating digital marketing content on HONMA’s global website aswell as social platforms, such as Instagram, Facebook, Wechat, Weibo, etc• Content collaboration with pros, influencers and celebrities on various digitalplatforms• To convey consistent brand image and enhance brand awareness acrossall markets• To recruit and engage with younger and internet-savvy consumer• To generate traffic from digital platform to offline retail stores• To own the entire consumer experience and data

2023/2024 ANNUAL RESULTS

19

MAKETING: Re-defining HONMA as a dynamic, relevant and premium golf lifestyle brand
CONTINUOUSLY DRIVE BRAND AWARENESS ACROSS ALL MARKETSCUSTOMER EVENTS
3,564 EVENTS, 53,230 PARTICIPANTS• Customer events are important customer touch points for HONMA• These events were mainly held on golf courses with dedicatedfitters• Brand experience integrating and retail activities targeting
consumers in super-premium and premium-performance segments• Key to the continued enhancement of HONMA’s brand and productawareness and consumer engagements

2023/2024 ANNUAL RESULTS

20

MAKETING: Re-defining HONMA as a dynamic, relevant and premium golf lifestyle brand
CONTINUOUSLY DRIVE BRAND AWARENESS ACROSS ALL MARKETSSPONSORING 6 PROFESSIONAL PLAYERS PLUS A WIDE NETWORK OF
HONMA BRAND AMBASSADORS AND COACHESTEAM HONMA WINNING CHAMPIONSHIP IN PROFESSIONAL TOURS• Renewed endorsement strategy to recruit younger and uprising athletes

in Asia with visible social media followings, so as to address andengage with the performance-driven audience, especially younger andavid golfers amid the promising trend of golf development in Asia

TEAM HONMA IN MARKETING AND CUSTOMER ACTIVITIES

2023/2024 ANNUAL RESULTS

21

MAKETING: Re-defining HONMA as a dynamic, relevant and premium golf lifestyle brand
CONTINUOUSLY DRIVE BRAND AWARENESS ACROSS ALL MARKETSOTHER BRAND PR & MEDIA EXPOSURE• Actively reinforcing HONMA’s brand image through continued media exposure and collaboration with brand ambassadors and social celebrities.

2023/2024 ANNUAL RESULTS

22

04

FINANCIAL REVIEWResilient performance and improvements under a challenging environment
NET SALESGROSS PROFIT & GROSS MARGIN

JPY MM

JPY MM- 11.1%
29,49528,971

15,686

26,22322,735

14,98813,433

11,44550.3%

FY2021-10.4%FY2022

FY2023

FY2024FY2021

54.1%

FY2022Gross Profit

Net Sales

EBITDA+0.4pp
50.8%

51.2%

FY2023

FY2024Gross Margin

NET PROFIT

JPY MM

JPY MM+22.0%

9,304
4,475

5,974

19.3%
19.7%
FY2021

20.3%
FY2022
EBITDA

2023/2024 ANNUAL RESULTS

7,285

FY2023
EBITDA Margin

3,256
8.2%

p
+7.5p

32.1%

6,191

27.8%

1,859

FY2024FY2021

21.4%

3%
+48.

4,828

+7.4pp

18.4%

11.0%

FY2022

FY2023

Net Profit

Net Profit Margin

FY202424

Continued OPEX optimization to resource to win
TO ENHANCE AS WELL AS TO MITIGATE NEGATIVE IMPACT FROM GLOBAL ECONOMIC UNCERTAINTY
SG&A EXPENSES BRIDGE

SG&A EXPENSES BREAKDOWN
AS % OF SALESJPY MM+2.9pp11,020
-250

-283

131

264
-289

10,547-472023/2024 ANNUAL RESULTS

4
202
FY

es
l Fe
nta
Re

De
rig prechtof- iation
use
o
ass f
e ts

es
ens
E xp
min

Ad

Oth
er S
Exp elle n s in g
es

s
nse
xpe
PE

A&

Em
p
ben loyee
efit
s

FY

202

3

-4.3%

37.4%

40.3%
2.7%

2.0%
3.6%

5.0%

4.8%

5.2%

7.3%

7.2%

8.4%

8.4%

11.2%

11.7%

FY2023

FY2024

Employee Benefits

Other Selling Expenses

Advertising & Promotion Expenses

General & Administrative Expenses

Depreciation of Right-of-Use Assets

Rental Fees

25

Healthy balance sheet and strong operating cashflow
NET OPERATING CASH FLOWJPY MM

CASH and CASH EQUIVALENTS

JPY MM

8.7%
1
+
:
R
G
A
C
6-YEAR
%
+47.3

5,916
3,983

FY2021+18.0%
5,416

FY2023

FY2024INTEREST-BEARING LIABILITIES

7,700
7,290

FY2021

FY2022

FY2023

FY2024INTEREST-BEARING LIABILITIES / TOTAL EQUITY%

JPY MM

8,026

14,085

16,617

10,772

3,676

FY2022

14,455

-4.1%

37.6%

30.4%

28.0%

24.4%

FY2022

FY2023

FY2024

6,990

FY20212023/2024 ANNUAL RESULTS

FY2022

FY2023

FY2024FY2021

26

Continuously improving working capital efficiency

RECEIVABLES TURNOVER DAYS (1)DAYS

PAYABLES TURNOVER DAYS (1)INVENTORY TURNOVER DAYS (1)

DAYS

DAYS

+22 days

68

54

321

299

-1 day
53

293

58
47

-13 days
209

243

38

21

63

52

56

FY2022

FY2023

FY2024

WIP

Finished Goods

195
34

34

FY2022

FY2023

FY2024FY2022

FY2023

FY2024

Raw Materials

Note(1) Turnover days are calculated using the average of the opening and closing balance of the relevant periods

2023/2024 ANNUAL RESULTS

27

05

OUTLOOKOUTLOOKFOR THE YEARS AHEAD

CHALLENGES

HONMA will continue executing its growth strategies to build a world-leading golf lifestylecompany, leveraging its unique brand legacy, innovative technologies and exquisite
Japanese craftsmanship, and optimized distribution network.

The golf industry will continue to face multiple challenges in
the near future, including

We intend to continue pursuing the following in the years ahead:a) Sustainably improve and transform HONMA brand value into customer loyalty.
b) Continuously increase the Group’s market share in home markets by maintaining its
leading position in the super-premium segment while making solid inroads into the fastgrowing premium-performance segment.
c) Nurturing complementary non-club product lines to provide customers with a complete
golf lifestyle experience.
d) Anchoring sustainable growth in North America and Europe based on the updated
product and distribution strategy.
e) Continue product innovation and development to cater for latest market trends.

2023/2024 ANNUAL RESULTS• more intense competition as retailers were struggling

with higher than expected inventories and sluggish
consumer demand• sustained global economic and geo-politial uncertainties• supply chain challenges as a result of labour shortageand increase of raw material priceIn face of such challenges, the Group is confident in its
ability to mitigate the adverse impacts of such uncertainties
and will seize every possible opportunity to preserve cash, tooptimize its operational efficiencies in order to foster a solid
foundation for the mid- and long-term development withrespect to its brand, products, distribution channel,
employees and supply chain.

29

06

APPENDIXBUSINESS REVIEW BY MARKET
HOME MARKET JAPANSTEADY AND QUALITY GROWTH IN MULTIPLE PRODUCTCATEGORIES FOLLOWING FURTHER MARKET REOPENING% of Total Sales

2.4%

1.4%

9.0%

Japan

35.7%

MARKET

•
•
•
•

Korea

2nd largest golf equipment market in the world
Total golf product market size approximates to USD 1.7 billion in 2021 (1)2,200 golf facilities, representing half of the total facilities in Asia (1)In 2022, 8.1 million 9 & 18 hole golfers (know as on-course golf players),
around 6.4% of total population in Japan (2)China(Including Hong Kong and Macau)
Other Regions

28.6%

North America
Europe22.8%

FY24 FULL YEAR PERFORMANCE HIGHLIGHT
NET SALES -4.7% GROSS PROFIT MARGIN +5.8PP• Golf club sales -4.5% due to optimization of distribution networks, while

NET SALESJPY MM

9,822

9,363

•

BERES club family sales +19.6% thanks to successful activation of
BERES 09. Sales of putters +97.7% thanks to new products launch
Sales from self-operated stores +16.0%

-4.7%

Note
FY20232023/2024 ANNUAL RESULTS

FY2024(1) Source: 2021 Yano’s White Paper on Golf Industry, Japan(2) Source: The R&A Global Golf Participation Report 2023

31

BUSINESS REVIEW BY MARKET
HOME MARKET KOREAONGOING CHANNEL OPTIMIZATION FOR
BETTER PREPARATION ON PREMIUNPERFORMANCE SEGMENT EXPANSION% of Total Sales

2.4%

MARKET• Fast growing and under-penetrated market• 3rd largest golf market in the world with USD 3.9 billion golf apparel sales

1.4%

9.0%

Japan

35.7%

Korea
China(Including Hong Kong and Macau)•

Other Regions

28.6%

and USD 1.1 billion golf equipment sales in 2022. In addition, Korean
golfers spend more per capita on their golf equipment and apparel thanany other country.(1).
In 2022, 5.4 million of 9&18 hole golfers (know as on-course golf
players), around 10.4% of total population in Korea (2)North America
Europe22.8%

FY24 FULL YEAR PERFORMANCE HIGHLIGHT
NET SALES -15.5%

NET SALESJPY MM• Sales decrease was mainly due to the optimization of distribution
7,089
5,989

•

network, which has led to a temporary decline in sales from wholesales
BeZEAL club sales increased more than 1000 times, boosted bysuccessful launch of BeZEAL 3 in early 2024

-15.5%Note
FY20232023/2024 ANNUAL RESULTS

FY2024(1) Source : Golf Datatech & Yano Research, 2023 World Golf Report(2) Source: The R&A Global Golf Participation Report 2023

32

BUSINESS REVIEW BY MARKET
HOME MARKET CHINA (INCL. HK & MACAU)MEANINGFULAPPAREL AND E-COMMERCE GROWTH ALBEITWEAKENED CONSUMER SENTIMENT
2.4%% of Total Sales

1.4%

9.0%

• Dynamic market with an exciting uptrend in outdoor sports• Emerging and fast growing golf industry• 478 golf courses, expanding indoor facilities, around 1 million core golf
•

Japan
Korea

35.7%

MARKET

population(1)Solid and growing demand in active wear and fashion-athletic apparel

China(Including Hong Kong and Macau)
Other Regions

28.6%

North America
Europe22.8%

FY24 FULL YEAR PERFORMANCE HIGHLIGHT
NET SALES -3.7% GROSS PROFIT MARGIN +3.4PP• Golf club sales -15.8% under the economic slowdown and weakened

NET SALESJPY MM

7,564

-3.2%
FY2023

FY2024Mainland China
2023/2024 ANNUAL RESULTS

•
•
•

7,322

260
210
160
110
60

231

186

consumer sentiment while gross profit margin +12.1PP
Sales from self-operated stores +15.7% (mainland China)
Apparel sales +23.2% (mainland China) and gross margin reached 62.0%‘Flagship Store Plan’ – iconic stores set up as brand showroom at prime
locations in the first tier cities with upgraded visual display-19.4%FY2023

FY2024Note(1) Source : Forward Golf White Paper Report 2020

Hong Kong/ Macau
33

BUSINESS REVIEW BY MARKETNEW MARKET NORTH AMERICABUILDING A UNIQUE DIRECT-TO-CUSTOMERDISTRIBUTION MODEL TO CAPTURE SUPERPREMIUM AND PREMIUM-PERFORMANCE SEGMENT% of Total Sales

2.4%

1.4%

9.0%

Japan

35.7%

Korea
China(Including Hong Kong and Macau)
Other Regions

28.6%

North America
Europe22.8%

MARKET• Largest golf market in the world with USD 7.7 billion golf retail sales,•

accounting for 38.6% of the global golf economy, and USD 5.3 billion golf
equipment sales in 2022 (1)25 million on-course golf participants and 27.9 million off-course
participants (driving ranges, Topgolf venues, indoor simulators, golf inschool programs, etc.) in 2022(2)FY24 FULL YEAR PERFORMANCE HIGHLIGHT
NET SALES -38.2%• POS -1 to 344 in total• Sales decline following the ongoing adjustment in distribution network in

NET SALESJPY MM

the US; such adjustment aims to shift the focus of operation on a smaller
yet premier group of accounts

565
335-38.2%Note
FY20232023/2024 ANNUAL RESULTS

FY2024(1) Source : Golf Datatech & Yano Research, 2023 World Golf Report(2) National Golf Foundation (2017-2022). Golf Participation in the U.S., 2023 edition. Jupiter. FL

34

BUSINESS REVIEW BY MARKETNEW MARKET EUROPE
IMPROVED MARGIN FOLLOWING CHANNEL
ADJUSTMENT% of Total Sales

2.4%

MARKET• Mature but fragmented golf market• England, Austria, Germany, France and Sweden in total accounts foraround 12% of the world’s golf equipment sales, which approximates to
USD 1 billion (1)

1.4%

9.0%

Japan

35.7%

Korea
China(Including Hong Kong and Macau)
Other Regions

28.6%

North America
Europe22.8%

FY24 FULL YEAR PERFORMANCE HIGHLIGHT
NET SALES -18.3% GROSS PROFIT MARGIN +12.4PP• POS +94 to 129 in total• Sales decline due to the negative impact from the change to the

NET SALESJPY MM•

443
362

distribution model implemented last year
Number of POS came back to a well-shaped 129 with a smaller but
premier group of retail partners to pursue both sturdy growth andprofitability in the region-18.3%Note
FY20232023/2024 ANNUAL RESULTS

FY2024(1) Source : KGPA, Korea Golf Association 201735

CONSOLIDATED P&L
For the twelve months ended 31 March
2024
JPY

2023
%

YoY Change

JPY

%

%

(In thousands, except for percentages and per share data)
Consolidated Statement of Profit or Loss
100.0
-48.8

29,494,999

100.0

Cost of sales

26,222,857-12,790,169-14,506,744

-49.2

-11.1
-11.8

Gross profit

13,432,688

51.2-14,988,255

50.8

-10.4

Other income and gains

2,673,958

10.2

515,365

1.7

418.8

Selling and distribution expenses-9,180,750-35.0-9,607,191

-32.6

-4.4

Administrative expenses-1,389,752-5.3-1,381,057

-4.7

0.6

23,3300.1-31,923-0.1-173.1Other (expenses)/income, net-227,851-0.9-279,053

-0.9

-18.3

Finance costs-190,436-0.7-124,990

-0.4

52.4

Finance income

11,128Less than 0.1%

13,463

Less than 0.1%

-17.3

Profit before tax

5,152,315

19.6

4,092,869

13.9

25.9

Income tax expense-324,187-1.2-837,264

-2.8

-61.3

Net profit

4,828,128

18.4

3,255,605

11.0

48.3

Revenue

Reversal of/(Provision for) impairment losses on financial assets

Earnings per share attributable to ordinary equity holders of the parent
7.97

Basic and diluted

5.38

48.1

Non-IFRS Financial Measures
Operating Profit

2,706,208

10.3

3,856,557

13.1

-29.8

Net Operating Profit

2,726,336

10.4

2,922,546

9.9

-6.7

Note
2023/2024 ANNUAL RESULTS(1) Operating profit is derived from profit before tax by (i) subtracting other income and gains, and (ii) adding other expenses.
(2) Net operating profit is derived from net profit by (i) subtracting other income and gains, (ii) adding other expenses and (iii) adding impact on tax related to items (i) and (ii) above.

36

CONSOLIDATED BALANCE SHEET

Financial Position as at
2024.3.31

2023.3.31

JPY

JPY

(In thousands, except for percentages and per share data)
Consolidated Statement of Financial Position
AssetsNon-current assets

8,894,695

8,208,542

Current assets

33,650,502

32,158,818

Total Assets

42,545,197

40,367,360

Non-current Liabilities

2,190,133

2,201,905

Current Liabilities

11,682,684

12,134,527

Total Liabilities

13,872,817

14,336,432

Net current assets

21,967,818

20,024,291

Total assets less current liabilities

30,862,513

28,232,833

Net Assets

28,672,380

26,030,928

Total Equity

28,672,380

26,030,928

Liabilities

2023/2024 ANNUAL RESULTS

37

CONSOLIDATED CASH FLOWSFor the twelve months ended 31 March
2024

2023

JPY

JPY

(In thousands, except for percentages and per share data)
Cash and cash equivalents at the beginning of year

14,084,742

14,454,554

Net cash flows generated from operating activities

5,416,118

3,675,831

Net cash (used in) investing activities-583,388-570,757

Net cash flows (used in) financing activities-3,563,984-3,644,436

Net increase in cash and cash equivalents

1,268,746-539,327

Net effect of foreign exchange rate changes

1,263,597

169,550

Cash and cash equivalents at the end of year

16,617,120

14,084,742

2023/2024 ANNUAL RESULTS

38

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