HONMA GOLF LIMITED (6858.HK)

2021/22 aNNUAL results
JUNE 2022

one of the most prestigious and iconic brands in the golf industry

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ANNUAL REPORT 2021/22

01

1.

HONMA

ANNUAL REPORT 2021/22

02

#1 Premium golf brand founded in 1959, Japan60+ years of dedications towards Quality and Craftsmanshipthe only vertically integrated golf company in the worldhonma
In-house R&D andclub manufacturing••

ANNUAL REPORT 2021/22

Premium & Performance-driven
Golf Products

232 R&D personnel and skilledcraftsmen operating out of 163,000 m2
of manufacturing base in Sakata,
Japan

•
•

Advanced and sophisticated design
and manufacturing capacity, housed
under one roof•

Diversified range of products
Club portfolio focusing on superpremium and premium-performance
consumer segments
Comprehensive range of non-clubproducts including balls, apparels andaccessories

Extensive DTC +distribution network••

Presence in over 50 countries•

4,144 POS via third party retailers &wholesalers•

Fast growing E-commerce business in
China, Japan and the US

The only golf brand with 80 selfoperated stores

03

2.

PERFORMANCEOVERVIEWANNUAL REPORT 2021/22

04

HONMA Delivered record sales and profitability in FY22
despite challenges and uncertainties in a post-pandemic world
Full Year Ended 31 Mar 2022

Growth vs FY2021 (JPY Base)

Growth vs FY2020 (JPY Base)

JPY 28,971 MM / USD 249.2MM (1)+27.4%+21.8%

54.1%+3.8pp+3.2pp

EBITDA- EBITDA Margin

JPY 9,304 MM / USD 80.0MM (1)32.1%+112.5%+12.9pp+674.7%+27.1pp

Net Profit- Net Profit Margin

JPY 6,191MM / USD 53.3MM (1)21.4%+233.0%+13.2pp+JPY 6,924MM+24.4pp

JPY 10.22 / HKD 0.69 (3)+233.0%+JPY 11.43

Net Operating Cash Flow

JPY 5,916MM / USD50.9MM (1)+48.5%+959.1%Net Cash Position

JPY 7,355MM / USD 60.2MM (2)+165.3%+292.7%

Proposed Dividend

Proposed final: JPY 2.0/share
Interim declared: JPY 1.5/share
Total: JPY 3.5/share

Net Sales
Gross Profit Margin

key
financials

Reported Earnings Per ShareDividend Payout Ratio

34.2% of the Group's distributable profit
for the year ended 31 March 2022

Note(1) Exchange rate: 1 USD = 116.25 JPY

ANNUAL REPORT 2021/22(2) Exchange rate: 1 USD = 122.16 JPY(3) Exchange rate: 1 HKD = 14.90 JPY05

sales Overview

FY22 net sales: JPY 28,971 Million / USD 249 Million, +27.4%

Robust YOY sales growth across ALL markets, driven
by strong rebound of consumer demand, andsuccessful execution of HONMA’s growth strategies
leading to enhanced brand and product awareness.

%

Performanceoverview
by market

China, South Korea, Other Regions and Europe recorded historical sales, albeit
supply chain constraints and retail activities interruption caused by continued
presence of COVID-19 in different parts of the world.
Sales from South Korea grew by 7.0%, in spite of a mid-year change in the
distribution right of HONMA’s Tour World club family.

4.8 3.4

12.5

29.3

+47.1%EUROPE+38.7%

Sales: JPY 1,393 MM

china(incl. hk & macau)
Sales: JPY 7,644 MM

23.6+29.8%
japan
Sales: JPY 8,497 MM

+7.0%

+8.0%
north America
Sales: JPY 992 MM

south Korea
Sales: JPY 6,832 MM

26.4+48.7%Japan
China (Including Hong Kong and Macau)
Korea
Other Regions
EuropeNorth America

ANNUAL REPORT 2021/22

other regions
Sales: JPY 3,612 MM

06

sales Overview

FY22 net sales: JPY 28,971 Million / USD 249 Million, +27.4%• Sales from all product categories showed double
digit growth

Golf clubs• Sales from non-club categories climbed to 28.1%••

of total (vs 26.0% for FY21 and 20.8% for FY20)%

Performanceoverview
by product category

Net sales +23.9% to jpy 20,843 million
gross margin +6.9pp to 58.1%

golf balls

7.6

10.3
71.9

apparels

Golf Clubs
Golf Balls
Apparels
Accessories & Other Related

Continued double digit growth for the past 7 years at 38.6% CAGR
Pivoting a three product strategies targeting low, mid and high pricesegments

Net sales +71.6% to jpy 2,963 million
gross margin -10.2pp to 49.1%•

Growing brand awareness and consumer mind share throughdynamic digital campaigns•

Continued upgrade of product development, merchandise planning &retail operations

Accessories

Net sales +43.1% to jpy 2,190 million
gross margin -5pp to 34.9%••
ANNUAL REPORT 2021/22

Sales from BERES club family +41.8%, driven by the successful
activation of BERES Aizu, the latest version of the classic superpremium club family, which was launched in Dec 2021

Net sales +11.8% to jpy 2,974 million
gross margin +0.5pp to 45.5%

•
•

10.2

Robust growth across all product families

Continued extension of adjacency products
Expansion of sales and distribution network, particularly in China and
Korea
07

sales Overview

FY22 net sales: JPY 28,971 Million / USD 249 Million, +27.4%• Significant improvement in same-store-sales(SSS) of the self-operated stores• Continued channel penetration by adding 209

third party POS following the re-opening of golf
facilities and recovery of retail activities

Direct-to-Consumer channel
net sales +22.0% to jpy 7,285 million; gross margin -2.6pp to 58.4%
80
self-operated stores•+12 new locations; total number of storesremains unchanged•

Continued optimization of store design, visualdisplay and consumer experience••

Operating in China, Japan and the US%

Performanceoverview
by channel

25.1

E-Commerce

Total net sales +80.1%; net sales from China+91.4%, Japan +77.9%

74.9

3rd party retailers and wholsalers
Distributors
DTC Channels

net sales +29.4% to jpy 21,686 million; gross margin +6.3pp to 52.7%
4,144
3RD PARTY POSANNUAL REPORT 2021/22••+209 POS
Sales went up as a result of pent-up demand
and much improved retail environment,
following ease of COVID related restrictions in
multiple major markets

08

3.

BUSINESSHIGHLIGHT

ANNUAL REPORT 2021/22

09Three-Pillar
Growthstrategies

productchannelBranding and Consumer engagement

GOLF CLUBS• Strengthened focus on super premium and•Continuously upgrading HONMA’s retailpresence with primer locations, elevatedvisual design and merchandising display toprovide better consumer experiences••

Further penetration into premiumperformance segment by adding quality
retailers and POS

Upgraded 360 degree HONMA brandexperience across all of HONMA’s consumer
touch points, pursuing golfers in superpremium and premium-performancesegments••

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

Rejuvenated TEAM HONMA with younger
and uprising athletes, coaches andinfluencers•

Enhanced CRM system to better understandconsumers and nurture loyalty•

Strengthened PR activities across all
markets featuring a special episode by CNN
LIVING GOLF program during Tokyo
Olympics, showcasing HONMA’s dedication
towards premium club-making for 6 decades••

premium performance consumer segments
Enriched premium performance products
targeting golfers with 8-20 handicaps
Unique product offerings designed forsocial media savvy female golfers

non-club products• Steady advancement of ball and accessory•

ANNUAL REPORT 2021/22

businesses in premium consumer segments
Nurturing apparel business in the fast
growing Asia home markets, aiming tobroaden the reach towards a wider
spectrum of active and outdoor-inspired
populations10

super premium segment

premium performance segment

other club products
putters, country specific models,
special editions

Beres Aizu

Launched in Dec 2021

for serious golfers
handicap 0-12

Daruma Series

TW757

A.

Launched in Mar 2022

CLUB PORTFOLIO
optimized
tO FOCUS ON SUPERPREMIUM AND PREMIUMPERFORMANCE CONSUMERS
SEGMENTS

Beres Aizu Black

Launched in Dec 2021

for game improvement golfers
handicap 8-20

65th Anniversary Sakura Dance

TW-GS

Launched in Feb 2021

ANNUAL REPORT 2021/22

11

sales from golf clubs shot up by 23.9% YOY (+10.6% vs FY20) to JPY 20,843 million
Gross margin +6.9PP to 58.1% thanks to continued retail price management and manufacturing cost optimization

Beres

A.

CLUB PORTFOLIO
optimized

product
launch•Beres Aizu was launched in Dec
2021, with a highly differentiablesophisticated designtO FOCUS ON SUPERPREMIUM AND PREMIUMPERFORMANCE CONSUMERS
SEGMENTS(cont’d)

ANNUAL REPORT 2021/22

sales
performance••

FY22 sales +41.8%•

Strong sales growth thanks to thesuccessful activation of Beres Aizu
worldwide

53.2% of club sales

Tour World•

2-proned product approach
appealing both single and double
handicappers••

TW-GS was launched in Feb 2021••

FY22 sales +1.2%•

Sales growth remained flattish
mainly due to the activation time of
TW757

OTHERS•••

Putters••

FY22 sales +17.4%•

All-time favorite to consumers who
are looking for extinguished andexquisite cosmetics

Country specific models
Special editions

TW757 was launched in Mar 2022
and already attracted great media
buzz

17.1% of club sales

29.5% of club sales

12Golf ball sales increased by 11.8% YOY (+34.8% vs FY20) to JPY 2,974 million
Gross margin +0.5PP to 45.5% despite supply chain constraint and purchase cost pressure

B.
STEADY REVENUEGROWTH IN
GOLF BALLS
across asia home markets

D1, 2-LAYER BALL

TW-X 2021, 3-LAYER BALL

HONMA X4, 4-LAYER BALL•

Sales from Japan +6.4%

golf ball sales•

Sales from South Korea +35.0%

JPY MM•

Sales from Mainland China +6.7%•

Continuously prioritizing product development to pivot sales
growth

•Dedicated sales force in Japan, China and South Korea todrive market penetration and consumer mind share

R:
G
A
C

%
6
.
8
+3

2,659

2,974

2,211

1,805
1,148
420
FY16

ANNUAL REPORT 2021/22

Beres 5 Star, 6-LAYER BALL

736

FY17

FY18

FY19

FY20

FY21

FY22

13

APPAREL sales surged 71.6% YOY (+134.5% vs FY20)
to JPY 2,963 million
Gross margin -10.2PP to 49.1 % due to inventory
provision policy alignment and clearance of 2020
inventoriesc.
continue
nurturingapparel businessacross asia home markets•

Robust sales growth primarily driven by continued improvementin product offerings and retail operation•

Successful E-commerce strategy supported by digital marketingon major social media platforms to gain consumer mind sharewith HONMA apparels•

Sales growth largely contributed by China and South Korea
business:
Sales in Mainland China +87.1%•

Fast-evolving sports market with growing mass interests in
outdoor sports•

HONMA brand apparel stores +10 to 44 in total

apparel collection consisting of 2 distinctive
product lines targeting premium performanceand fashion athletic consumer segments
premium PERFORMANCE line
Professional performance wear designed for golfers to perform perfectly on thecourse, featuring high-tech functional fabrics and 3D synchronized cutting

FASHION ATHLETIC line
Trendy athleisure wear targeting golfers and pan-golfers, featuring fashionable
and diverse designs and details

Sales in South Korea +101.5%

ANNUAL REPORT 2021/22•

Fastest growing market in woman’s sports fashion•

HONMA brand apparel stores +4 to 29 in total

14

Self-owned retail channels
act as brand experience hubs across all markets

d.
omni
distribution
footprint withelevated retailpresence

ANNUAL REPORT 2021/22••

Sales from self-owned channels +22.0%•

Same-store sales significantly improved

80 self-owned stores; 12 new stores opened while total numberof stores unchanged

Third-party retailers and wholesalers
continued to drive penetration and gain mind share••

Sales from third-party +29.4%
Number of POS increased by 209 to 4,144•+103 in the US, encouraged by the coming back of golfers
post COVID-19 and enhanced brand recognition•+47 in South Korea to fuel sales growth of the Tour Worldclub family

15E-commerce SALES rocketed up by 80.1%
Driven by- Accelerated digital marketing, in particular content
marketing efforts and full-channel approache.

renewede-commerce
strategies
supported by up-todate social media andcrm platforms

ANNUAL REPORT 2021/22•

E-commerce platforms in major markets• China: Tmall, JD, Douyin and DU (得物)••• Japan & US: self-operated E-commerce site
E-commerce sales grew significantly, led by China+91.4% and Japan +77.9%
Actively pursuing an E-commerce growth strategy• Dedicated E-commerce team and marketing
resources• Social media campaigns to generate traffic to
E-commerce pages• Livestream (直播) sales campaign launchedon E-commerce platforms• Search engine optimization and in store visual
updates• Full channel CRM system to upgrade loyalty
program and improve consumer experiencesUS
e-commerce site
tmall
flagship store

livestream

japan
e-commerce site16

driving brand awarenessacross all markets

F.
Re-defining HONMA

Dynamic,
Modern,GlobalANNUAL REPORT 2021/22

customer events
3,739 events, +22.5% yoy
43,644 participants, +14.2% YOY•

Customer events are important customer touch points
for HONMA•

These events were mainly held on golf courses withdedicated fitters•

Integrated brand experience and retail activities
targeting consumers in super premium and premium
performance segments•

Key to the continued enhancement of HONMA’s brandand product awareness and consumer impression

17

upgraded digital communication throughRelaunched Global Website &All-channel social media accounts•

Frequently rolling out digital marketing content on HONMA’s
global website as well as social platforms including Instagram,
Facebook, Wechat, Weibo, etc•

Content collaboration with pros, influencers and celebrities
both on tour and on digital platforms

F.
Re-defining HONMA

Dynamic,
Modern,Global(cont’d)

ANNUAL REPORT 2021/22• To convey consistent brand image and enhance brandawareness across all markets• To recruit and engage with younger and internet-savvy
consumer• To generate traffic from digital platform to offline retailstores• To own the entire consumer experience and data18

Sponsoring TEAM HONMA players
11 players on team HONMA
as at 31 mar, 2o22

F.

2 Korea Ladies

Professional Golf (JLPGA)

Professional Golf (KLPGA)

1 korea pga (kpga)

Team HONMA winning championship in Professional Tours•

Renewed pro-sponsoring strategies to recruit
additional young and uprising athletes in Asia withvisible social media followers•

To further enhance HONMA’s tour presence in Asia withperformance-driven audience, especially younger andavid golfers amid the promising trend of golf
development in Asia

Re-defining HONMA

Dynamic,
Modern,Global8 Japan Ladies

Team HONMA in marketing and customer activities(cont’d)

ANNUAL REPORT 2021/22

19

Li yifeng named as honma’s brand ambassador
in The 65th anniversary campaign•

F.
Re-defining HONMA

Dynamic,
Modern,Global(cont’d)

ANNUAL REPORT 2021/22•

Renowned actor Li Yifeng named as HONMA’s brandambassador on 20 May 2022
On the same day, HONMA launched a nationwide campaign
for the 65th anniversary ‘SAKURA DANCE’ club set in China,
which is designed for younger and social media active female
golfers

The new partnership aims to• Further promote the spirit of golf to a wider audience• Broaden the brand's reach to younger and internet-savvy
sports enthusiasts• Fuel the brand’s digital marketing to the next level
Related marketing contents became viral and achieved
unprecedented public exposure• Achieved more than 720 million impression across various
social media platforms• Generated more than 2 million visits to HONMA’s Tmall and
JD flagship store on the same day of the announcement

20

Other brand PR & Media exposure•

To communicate and reinforce HONMA’s brand image being
premium, performance-driven, dynamic and modern throughomni channels from golf magazines and TVCs, to golf
simulator ads and celebrity show virtual ads•

In September 2021, HONMA was featured by CNN Living Golf
at in its Tokyo Olympics episode, showcasing HONMA’s
dedication towards craftsmanship in premium club-making
for more than 60 years

F.
Re-defining HONMA

Dynamic,
Modern,Global(cont’d)

ANNUAL REPORT 2021/22

21

4.

FINANCIALREVIEW

ANNUAL REPORT 2021/22

22

NET SALES

Gross Profit & GROSS Margin
4+27.

JPY MM

23,787

visibleimprovements
in All Financial
Metrics
thanks to the
exuberant demand andthe successful
execution of growthstrategies

JPY MM.0+37

28,971

22,735

12,118FY2020

FY2021

FY2022

FY2020+3.8pp

FY2021

15,68654.1%

FY2022Gross Profit

EBITDA%

11,44550.3%

Gross Margin

net profit

JPY MM

+1

4,379
1,201
FY2020EBITDAANNUAL REPORT 2021/22

%

19.3%

.5
2
1

%

pp
+12.9

9,304

JPY MM

3
2
+

1,859

32.1%

8.2%

FY2020

FY2021
FY2021

FY2022
EBITDA Margin

-732

%
0
.
3

pp
2
.
3
+1

6,191
21.4%

FY2022-8.9%
Net Profit

Net Profit Margin23

SG&A Expenses

SG&A Expenses Breakdown

JPY MM

AS % OF SALES

131

103

-133

Effective
efficiency
improvement
initiatives

1.6%

-361

5.4%

4.3%

2.4%
3.0%

9.8%

+0.2%

10,1493.2%
7.2%

10,173
9.8%

8.2%

De

nta
lF
ees

Se
llin
gE

Oth
er

Re

fits
ne

Be
Em
plo
yee

pre
A&
PE
cia
tio
xp
en
no
ses
f ri
gh
t-o
f-u
se
Ad
a ss
mi
ets
nis
tra
tiv
eE
xp
en
ses

13.8%

FY2021

ANNUAL REPORT 2021/22

-57

35.1%

xp
en
se

to fuel growth aswell as to mitigate thenegative impact fromCOVID and supply chain
disruption

44.6%

340

FY2022

FY2021
Employee Benefits
Depreciation of Right-of-Use Assets

11.2%

FY2022Other Selling Expenses
Administrative Expenses

A&P Expenses
Rental Fees

24

Coherent
policies onstrong cash
liquidity andhealthy capital
structure
To ensure steady andsustainable growthamidst uncertain
macro environment

Net Operating Cash Flow

cash on hand

JPY MM

JPY MM

%
5
.
8
+4

5,916

3,983

10,473

10,772

FY2020

FY2021%
14,455559
FY2020

FY2021

FY2022

FY2022

Interest-bearing Liabilities

Interest-bearing Liabilities / Total Equity

JPY MM

%

-4.1%
8,600

FY2020ANNUAL REPORT 2021/22

.2
+34

8,026

FY20217,700

FY202240.4%

FY202037.6%

FY202130.4%

FY202225

Receivables Turnover Days (1)Payables Turnover Days (2)Inventory Turnover Days (2)

DAYS

DAYS

DAYS

139
69
112

Strengthened
Working Capital
Efficiency
Post COVID-19-44 days314-21 days293-11 days

268

63
58
219
172

195

68

FY2020

FY2021

FY2022

FY2020

FY2021

FY2022

25

30

34

71

65

63

FY2020

FY2021

FY2022

Raw MaterialWork in Process

Finished Goods

Note(1) Turnover days are calculated using the average of the opening, mid year and closing balance of the relevant periods(2) Turnover days are calculated using the average of the opening and closing balance of the relevant periods.

ANNUAL REPORT 2021/22

26

5.

outlook

ANNUAL REPORT 2021/22

27

outlookchallenges

We expect sales growth momentum to continue into FY2023, fueled by multiple productactivations in both clubs and non-club categories, continued marketing investment andretail operation improvement.

The golf industry will continue toface multiple challenges in FY2023,
includingIn the mid- to long- term, HONMA will continue executing its growth strategies to build aworld-leading golf lifestyle company, leveraging its unique brand legacy, innovativetechnologies and exquisite Japanese craftsmanship, and expanding distribution network.

•

supply chain challenges under
inflation pressure•

sustained outbreak of COVID-19
which may continue to cause
market turbulence anduncertainties.

We intend to continue pursuing the following in the years ahead:outlooka) To further increase and regain HONMA’s market share in Asia home markets bymaintaining its leading position in the super-premium segment while making solid
inroads into the fast growing premium-performance segment.
b) To continue driving ball, apparel and accessories businesses across Asia markets tocapture the growing opportunities in the non-club categories of these regions.
c) To pivot growth in North America and Europe based on the updated product and DTC
distribution strategies.
d) To continue leveraging HONMA’s unique legacy in R&D capabilities to develop productsthat cater for latest market trends.

In face of such challenges, HONMA
will continue to take active actions
to optimize cost efficiency,
maximize liquidity and protect its
employees’ health, in order to fostera solid foundation for the mid- andlong-term development.

e) To further nurture and transform HONMA brand value into customer loyalty.

ANNUAL REPORT 2021/22

28

6.

appendix

ANNUAL REPORT 2021/22

29

strong rebound following successful
new product activation as consumer
demand recovered
4.8 3.4%
12.5

Appendix I

Business
Reviewby Market

29.3

•
•

2nd largest golf equipment market in the world•

2,290 golf facilities, representing half of the total facilities in
Asia (2)••Around 12 million golf population (3)23.6

Total golf product market size approximates to USD 2 billion in
2021 (1)

Hideki Matsuyama’s win in the US Masters Championship in Apr
2021 is seen to be a boost for Japan’s golf market

26.4

Japan
Korea
EuropeChina (Incl. HK and Macau)
Other Regions
North America

HOME MARKET

Japan

marketnet sales
8,497

JPY MM

FULL year performance review••

Golf club sales +35.5%, golf accessories sales +72.4%•

Strong rebound in sales following the rejuvenation of retail
activities and successful activation of Beres Aizu

6,545

Sales from third party distributors +38.3%, from self-owned
channels +17.1%+29.8%FY2021

FY2022Note(1) 2021 Yano’s White Paper on Golf Industry, Japan(2) 2018 Yano’s White Paper on Golf Industry, Japan(3) Frost & Sullivan

ANNUAL REPORT 2021/22

30

Robust growth driven by successful
growth strategies and unprecedented
increase in demand
4.8 3.4%

Appendix I

Business
Reviewby Market

12.5(incl. HK & Macau)•

Evolving sports market with growing interests in outdoor
activities•••

Emerging and fast growing golf market

29.3

Solid and growing demand in active wear and fashion-athletic
apparel

Japan
Korea
Europe

26.4

FULL year performance review

China (Incl. HK and Macau)
Other Regions
North America

mainland china• Golf club sales +28.1%, apparel sales +87.1%• Strong growth momentum remains as demand surged on theback of the recent golf market development•

net sales
7,501

JPY MM

5,335+40.6%FY2021

FY2022Mainland China

ANNUAL REPORT 2021/22

478 golf courses, around 1 million golf population (1)

23.6

HOME MARKET

chinamarket177

FY2021

Apparel sales accounted for 26.7% of total sales in the
Mainland (20.1% for FY21). Sales amount increased by 2.5
times in the past 4 years following the Group’s announcement
to relaunch its brand apparel business in 2018-19.3%

143

FY2022

HK / Macau

Note(1) Source : Forward Golf White Paper Report 202031

Resilient growth albeit change indistribution right of tour world club
family4.8 3.4%••

Fast growing and under-penetrated market•

6.3 million of golf population, close to 15% of total population in
Korea (1)

12.5

Appendix I

Business
Reviewby Market

market

29.3

23.6
26.4

Japan
Korea
EuropeChina (Incl. HK and Macau)
Other Regions
North America

FULL year performance review••

Club sales +1.5%, ball sales +35.0%, apparel sales +101.5%•

Solid growth in non-club product categories led by dedicatedsales force and marketing resources

HOME MARKET

korea

3rd largest golf equipment market in the world with USD 650
million equipment sales in 2018 (1)net sales
JPY MM

6,383

6,832

Mid-year change in the distribution right of Tour World club
family. The new Tour World growth strategy aims to largely
enhance product awareness and extend sales network for TourWorld in Korea market.

+7.0%

FY2021

ANNUAL REPORT 2021/22

FY2022Note(1) Source : KGPA, Korea Golf Association 201732

Effective awareness elevation andcontinued POS increase

market••4.8 3.4%

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

12.5
29.3

Appendix I

Business
Reviewby Market

23.6

Japan
Korea
Europe

26.4

FULL year performance review

China (Incl. HK and Macau)
Other Regions
North America•••

Club sales +56.5%, Beres +121.8%
POS +24 to 615 in total
Enhanced brand awareness and product recognition with bothsuper-premium and performance-driven club segments

NEW MARKET

EUROPEnet sales
JPY MM

1,393

947
+47.1

FY2021

ANNUAL REPORT 2021/22

FY2022Note(1) Source : KGPA, Korea Golf Association 201733

building a unique direct-to-customer
distribution model to capture superpremium and premium performance segment
3.4

%

4.8

Appendix I

Business
Reviewby Market

12.5
29.3

•

Largest golf market in the world with 53% of the global golf
retail sales (1)•2018 golf equipment sales approximates to USD 4.3 billion by
forecast (1)••Around 24 million golf participants (1)Double-digit YOY increase in national rounds played and newparticipation at all time high after market re-opening in 2H FY21

23.6
26.4

Japan
Korea
EuropeChina (Incl. HK and Macau)
Other Regions
North America

NEW MARKET

North
America

marketnet sales
JPY MM

919

FULL year performance review•••

Golf club sales +7.2%; Beres +75.4%
POS +103 to 337 in total;
Enhanced brand and product awareness through Direct-toConsumer (DTC) distribution strategy

992

+8.0%

FY2021

ANNUAL REPORT 2021/22

FY2022Note(1) Source : Golf DataTech’s 2018 research report34For the twelve months ended 31 March
2022
JPY

2021
%

JPY

%

YoY Change%(In thousands, except for percentages and per share data)
Consolidated Statement of Profit or Loss

Consolidated
P&L

Revenue

28,971,099

100.0

22,735,119

100.0

27.4

Cost of sales-13,285,472-45.9-11,289,914

-49.7

17.7

Gross profit

15,685,627

54.1

11,445,205

50.3

37.0

Other income and gains

2,192,521

7.6

1,538,719

6.8

42.5

Selling and distribution expenses-9,316,156-32.2-8,930,887

-39.3

4.3

Administrative expenses-857,037-3.0-1,217,804

-5.4

-29.6

Other (expenses)/income, net-89,021-0.3-351,232

-1.5

-74.7

Finance costs-66,414-0.2-76,225

-0.3

-12.9

Finance income

10,771

0.0

12,5310.1-14.0

Profit before tax

7,560,291

26.1

2,420,307

10.6

212.4

Income tax expense-1,369,103-4.7-561,201

-2.5

144.0

Net profit

6,191,188

21.4

1,859,106

8.2

233.0

Earnings per share attributable to ordinary equity holders of the parent
Basic and diluted

10.22

3.07

232.9%

Non-IFRS Financial Measures
Operating Profit

5,456,791

18.8

1,232,820

5.4

342.6

Net Operating Profit

4,329,498

14.9

759,751

3.3

469.9

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

ANNUAL REPORT 2021/22

35

As at 31 March
2022

2021
JPY

JPY

(In thousands, except for percentages and per share data)
Consolidated Statement of Financial Position
AssetsConsolidatedbalance sheet

ANNUAL REPORT 2021/22

Non-current assets

8,132,717

8,862,108

Current assets

33,294,755

30,354,928

Total Assets

41,427,472

39,217,036

Non-current Liabilities

2,543,336

2,355,906

Current Liabilities

13,531,534

6,363,274

Total Liabilities

16,074,870

8,719,180

Net current assets

19,763,221

23,991,654

Total assets less current liabilities

27,895,938

32,853,762

Net Assets

25,352,602

30,497,856

Total Equity

25,352,602

21,321,136

Liabilities

36

For the twelve months ended 31 March
2022

2021
JPY

Consolidated
cash flows

ANNUAL REPORT 2021/22

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

10,771,897

10,472,793

Net cash flows generated from operating activities

5,916,455

3,982,846

Net cash (used in) investing activities-157,081-571,489

Net cash flows (used in) financing activities-3,336,429-3,403,448

Net increase in cash and cash equivalents

2,422,945

7,909

Net effect of foreign exchange rate changes

1,259,712

291,195

Cash and cash equivalents at the end of year

14,454,554

10,771,897

37

For more inquires, please contact

ir@honma.hk