Earnings Results Briefing for
the Third Quarter of the Fiscal YearEnding March 31, 2018
February 9 2018
KOMEHYO Co., Ltd.
Securities code: 2780 (Second Section, Tokyo and Nagoya Stock Exchanges)
Corporate Planning Department IR strategy group TEL:+81-52-249-5366
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, and opinions of KOMEHYO Co., Ltd. are forward-looking statements subject tovarious risks and uncertainties.
These statements are prepared based on assumptions of the management of KOMEHYO 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 their own discretion.

Overview of Income Statement（ Consolidated ）FY2018
1Q(‘17.4-6)

FY20182Q(‘17.7-9)

YoY

YoYNet sales

9,849

107.6％

10,913111.2％

Gross profit

2,940

115.8％

2,988

Gross profit
margin29.9%+2.2ptSG&A
expenses

2,767

OperatingincomeConsolidated

FY20183Q

FY2018

YoY９months(‘17.4-12)

YoY

13,153119.0％

33,916113.0％

116.5％

3,895

123.5％

9,824

118.9％

27.4％+1.3pt29.6％+1.1pt29.0％+1.5pt106.6％

2,700

104.8％

2,895

112.5％

8,362

108.0％

173－

288

－

1,000

172.0%

1,461

284.2%

Ordinary
income

185－

287－

999

170.1%

1,472

294.8%Net income
attributableto owners ofparent

100－

195

649.2％

667

617.5％

963

1,202.5%(Millions of yen)(‘17.10-12)

1Overview of Income Statement（ Non-consolidated ）FY2018
1Q(‘17.4-6)

FY20182Q(‘17.7-9)

YoY

YoYNet sales

8,673

107.7％

9,858

111.6％

Gross profit

2,499

116.0％

2,579

Gross profit
margin28.8%+2.0ptSG&A
expenses

2,401

OperatingincomeNonConsolidated

FY20183Q

FY2018

YoY９months(‘17.4-12)

YoY

10,894120.0％

29,427113.3％

115.6％

3,103

124.1％

8,181

118.8％

26.2％+1.0pt28.5％+1.0pt27.8％+1.3pt107.9％

2,360

104.8％

2,435113.0％

7,197

108.5％

97－

218－

668

193.6%

984

388.7%

Ordinary
income

226－

217－

666

186.6%

1,110

447.9%Net income

168－

148

604.0％

455－

772

－

(Millions of yen)(‘17.10-12)

2

Operating income decrease factor（ Consolidated ）Operatingincome(Millions of yen)

1.5Pt

Sales amountincrease

Gross profit Marketing cost
Margin increase
increase△206+493

Personal
expenses
increase△22General andadministrative
expenses
increase△388+1,071+1,461An increase in card commissions,sales commissions, etc. along withan increase in sales amount+514

FY20179months

An increase in rents of landand buildings primarily due
to stores opening

Operating income(+947)

FY20189months

3

Gross Profit Margin Trend
Improvement from a year earlier due to reinforced inventory controls

Non-consolidated

Consolidated
FY2017 Gross profit margin（％）

FY2018 Gross profit margin

3230

29.9

29.6

27.4

2828.5FY2018 Gross profit margin

3230

28.5

FY2017 Gross profit margin

（％）

28.8

2826.227.7
2628.5

26

27.5

27.5

3Q

4Q

26.8

26.1
2424

22

22

20

20

1Q

2Q

3Q

4Q

25.2

1Q

2Q

4Overview of Balance Sheet
Increase in fixed assets due to factors including
the opening of large stores. (on a year-on-year basis)

Consolidated
Cash anddeposits
3,336

Cash anddeposits
3,548

Products
11,684
Products
10,623Othercurrent
Assets4,177

Othercurrent
Assets5,185

Current
liabilities
5,201
Non-current
liabilities
2,912

Net assets
17,918(Millions of yen)

Non-consolidated

Current
liabilities
7,651

Cash anddeposits
2,132

Non-current
liabilities
2,940

Cash anddeposits
2,293
Products
9,708

Net assets
18,833Othercurrent
Assets3,711

Products
10,556Other
current
Assets4,420(Millions of yen)

Current
liabilities
6,051

Current
liabilities
3,573
Non-current
liabilities
2,806

Non-current
liabilities
2,483

Net assets
16,916

Net assets
17,587

Non-current
Assets9,013

Non-current
Assets7,895

Non-current
Assets
9,007

FY2017 3Q

FY2018 3Q

FY2017 3Q

FY2018 3Q

FY2017 3Q

FY2018 3Q

FY2017 3Q

FY2018 3Q

AssetsAssetsLiabilities andLiabilities andAssetsAssetsLiabilities andLiabilities and26,032

29,425Net Assets

Net Assets

23,296

26,122

Net Assets

Net Assets

26,032

29,42523,296

26,122

Non-current
Assets7,583

5By Segment
The Brand Fashion Business(Millions of yen)

FY2018
1Q(‘17.4-6)

Earnings improvement progressed

FY20182Q(‘17.7-9)

YoY

BrandFashion
Tire andWheel

Net sales

8,827

107.9％

10,027

Operatingincome157－

Operatingmargin1.8％+2.3pt3.1%

Net sales

997

105.2％

Operatingincome1

OperatingmarginFY2018
3Q

YoY

YoY

FY2018９months

YoY(‘17.4-12)(‘17.10-12)

Others112.1％

11,092120.5％

29,947113.7％

315 1,631.7%

747

186.0％

1,220

319.7％+2.9pt

6.7％+2.3pt4.1％+2.7pt862

102.2％

2,038

111.9％

3,898

107.8％－△41－

239

138.2％

199

175.4％

0.1%+2.4pt△4.8％△0.3pt11.7％+2.2pt5.1％+2.0ptNet sales38

110.2％

37

107.5％

36

107.3％

112108.3％

Operatingincome15285.3％

14183.0％13211.1％

42

220.3％

Operatingmargin39.4％+24.2pt

37.5％+15.5pt

36.1％+17.8pt

37.7％+19.2pt

6

Revised FY2018 plan
Upward adjustment from the revision made in August
Consolidated(Millions of yen)

RevisedFY2018 PlanYoY

Nonconsolidated(Millions of yen)

RevisedFY2018 Plan

YoYNet sales

44,800111.6%Net sales

39,000111.8%

Operatingincome1,580

189.8%

Operatingincome1,070

212.8%

Ordinary
income1,580

193.7%

Operatingincome1,190

242.8%Net income
attributableto owners ofparent

1,020

286.7%Net income

820556.5%
7

Economic Trend
The economic environment remains on a moderate recovery path
Stock Price(yen)Department store(fine arts/jewelry/precious metals)

Net sales
YoY (%)

KOMEHYO net sales(non-consolidated)

140

24,000

Nikkei Stock Average(monthly closing price)130
22,000120
20,000

110
100
100

18,00090
16,00080

FY2018 ９months
70

14,000'16.4 56789101112 '17.1 23456789101112(Source : JAPAN DEPARTMENT STORES ASSOCIATION website)

8

Initiative①
Opening of New Stores
Large stores were opened near major railway stations
in Tokyo, Nagoya, and Osaka【Umeda store (‘17.2)】【Shinjyuku store ANNEX(‘17.5)】 【Meieki store(‘17.5)】

9Initiative②
E-commerce-induced sales“Buy Online and Pick up in Store,” connecting brick-and-mortar storeswith e-commerce sites, is on an upward trend
FY2018
1Q(‘17.4-6)

YoY

E-commerceinduced sales

1,453

E-commerceinducedsales rate

18.0％

(Millions of yen)

FY20182Q(‘17.7-9)

YoY

109.6％

1,914

128.4%

2,150

124.5％

5,518

121.4％

－

21.7％

－

19.7％

－

18.8％

－FY2018
3Q

YoY

FY2018９months

YoY(‘17.4-12)(‘17.10-12)【 Percentage of online sales by channel】【 Features of Online Request for Checking Actual Items 】①Easy: Make an application on the e-commerce site
13.4%

24.0%

KOMEHYOwebsiteBack orders②Peace of mind: You can check the item at a physical store.
③Free of charge: No charge if you do not buy it.

Others62.6%

We respond to customers’ need for “I want to see the actual item”
and “I want to decide after I try it” because it is a used item.

10

Initiative③
Purchase from Individual Customers
Purchases by individual customers have maintained an upward trend
due to advertising and publicity.
Amount ofpurchasefromindividualcustomers

FY20181Q(‘17.4-6)

Purchasing
Center

4,359

107.2％

4,617

118.3％

4,712

118.8％

13,690114.7％

Homedelivery
Purchasing

210

94.4％

218

115.4％

246

130.8％

675

112.5％

Total(Millionsof yen)

4,570

106.5％

4,836

118.2％

4,959

119.3％

14,366114.6％YoY

FY20182Q(‘17.7-9)

YoY

FY20183Q

YoY(‘17.10-12)

FY2018９months(‘17.4-12)

YoY【 LINE De Satei 】
started evaluating brand-name products in June 2016
Responding to customer need that they want to know
valuation first and are hesitant to ask for valuation onlyat stores

Total "number of Satei“ : about 60,000(‘17.12)

11Initiative④
Enhancement of purchases :LS Kamakuradai store
Establishment of Purchasing Center—Enhancement of purchases from individual customers【LINK SMILE Kamakuradai store】(‘18.2.9)
The third store after
USED MARKET Inazawa store(‘17.4)、
LINK SMILE Uedayama store(‘17.7)
More convenient for customers
by installing a purchase counterin a suburban store【USED MARKET Inazawa store】(‘17.4)【LINK SMILE Uedayama store】(‘17.7)

12

Initiative⑤
Challenge to The C-to-C Business
The C-to-C Business: Free market app “KANTE”【Free market app “KANTE”】
Service started in November 2017

Free market app specializing in brand-name products
Providing purchasers with a sense of assurance
through judgment of authenticity

Nurturing a healthy culture of reuse【Characteristics of functions】
POINT１

POINT２

POINT３

Follow theguidelines:
Take a photo ofyour item andselect the
information insequence. By
simply enteringsome basic
information,
you can put
your item up
for sale

You can start
the purchasing
procedure by
simply pushinga button.
Proceed withyour tradefollowing theguidelines.
Then all you
have to do is to
wait for yourpurchase toarrive!

With“KOMEHYO
Appraisal” byexperienced
experts, youcan trade highpriced brands
with peace ofmind

13

Subsidiary①
KOMEHYO Auction
Expand sales channels of used products, reinforce procurement
and collect industry information
FY2018 ９months

Trade volumeJewelry
WatchesBags

13,300

Clothing

260(Millions of yen)

【State of the tournament】

YoY

114.3％

116.5%

No. of member
companies810※70 companies
increased this term

【Preview venue】

14

Subsidiary②
KOMEHYO HONG KONG
Strengthen purchases of used products in Japanfor exploring overseas sales channels
Net sales(Millions of yen)

FY2018 ９months

962

YoY
161.2％【Hong Kong Jewelry show】

15Subsidiary③
Craft、Auto Parts Japan
Sale of tires, wheels, and vehicle parts
FY2018９months(‘17.4-12)【EURO STYLE Craft】
Net sales(Millions of yen)

YoY

Tires/wheels

3,371

111.7％

Parts

455

87.2％

Others

71

94.6％

3,898

107.8％

Segment total

Opened in Craft Nagoya Dome West store
2F in September 2017
Support customization focusing on euro
compact car【URBAN OFF CRAFT】
Opened in Craft Nakagawa store 2F
in October 2017
Proposing customization such as “Lift upsuspension” for Cross Country Style
４×４ and Urban SUV

16Subsidiary④
Eve Corporation、Ark marketing japan
We converted e-commerce apparel and shoe-care stores
into subsidiaries in December 2017
Company
name

Eve Corporation Co.,Ltd.

Ark marketing japan Co.,Ltd.

EstablishedMay 2010

August 2013

Head Office
CapitalJiyugaoka, Meguro ku Tokyo
9 million yen

1 million yen

1.Wholesale and retail of imported apparel,bags, and accessories;
Operation of mail-order sites “Mike MUSEUM”
2.Purchase and sales of shoes, etc.
Operation of mail-order sites “WORM TOKYO”
Operation of the store of “WORM TOKYO”

1.Sales of shoe-care goods, shoe
maintenance service, etc.
Operation of mail-order site “SHOESMASTER”

Businessactivities【Example of handled goods】【The store of WORM TOKYO】
Representative

President, Representative Director : Masaki Miwa (KOMEHYO Co., Ltd. Director)

17Reference Information①
Store Type
26 stores

5 stores

Large-scale
Sales/Purchase ※Ladies casualclothing, bags,
accessories

Nagoya Store，Meieki Store,
Shinjuku Store/ANNEX，Ginza Store，Umeda Store

Sales/Purchase

Jewelry, precious metals,
watches, bags, clothing , etc.

6storesMid-scale3 stores

Opening stores in large major cities

Sales/Purchase3stores

Sales/Purchase ※clothing in the low
price range, bags,
accessories

Small-scale
Opening stores in major cities

Sales/Purchase10stores（※

Some stores only as for the sale）

Purchasing Center
Opening stores in major cities

Purchase only

7stores

Total 34 stores（‘17.12）
18

Reference Information②
Shareholder return
Dividend changes
Dividend(yen)Payout ratio(％)

Fiscal year-end dividend

40Interim dividend

Payout ratio

92.4

Forecast 100
903530
30

8070

2560
2050

1536.240

29.31053023.016.013.224.816.615.519.415.002010FY2007 FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 FY201819