COMPANY RESEARCH AND ANALYSIS REPORTGLOBERIDE, Inc.
7990
Tokyo Stock Exchange First Section

27-Jul.-2017
FISCO Ltd. Analyst

Fumiya Mizuno

FISCO Ltd.
http://www.fisco.co.jp

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/■ Index■Summary---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- 01■Business details and history--------------------------------------------------------------------------------------------------------------------------- 02■Performance trends------------------------------------------------------------------------------------------------------------------------------------------------- 07
1. Review of FY3/17 results.............................................................................................................................

07

2. Outlook for FY3/18.. .....................................................................................................................................

08■Outlook and strategy---------------------------------------------------------------------------------------------------------------------------------------------- 11• Medium-term business plan.. .......................................................................................................................

11■Shareholder returns------------------------------------------------------------------------------------------------------------------------------------------------- 17

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/██SummaryRoughly met goals from the medium-term business plan that lasted
through FY3/17
GLOBERIDE, Inc. <7990> (hereafter, also “the Company”) became the global leader in fishing product sales (under
the DAIWA global brand) in 1976. It has consistently led the industry since then with numerous innovations, revolutionary products based on unique technologies, and new proposals for fishing lifestyle. DAIWA is a universallyknown presence in the fishing world. GLOBERIDE also sells products for golf, tennis, and cycling sports worldwide.
It generated 73.6% of sales in Japan and 26.4% from other countries in FY3/17 and has steadily solidified positionsin the Americas, Europe, and Asia and Oceania. Growth in sales to Asia has stood out recently. GLOBERIDE
manufactures almost all of its products, except for some luxury items, in China, Vietnam, Thailand, and otheroverseas sites. Sales ratios by products are fishing, the main business, at 84.0%, golf at 6.6%, racquet sports at
8.5% and others including cycling sports at 0.9%.
The Company renamed itself from Daiwa Seiko Corporation to GLOBERIDE on October 1, 2009. It continues to
use the DAIWA brand for fishing products and is steadily growing this business. Income fluctuates with trends ineconomic activity because the Company sells products for hobbies. However, GLOBERIDE possesses a strong
brand presence, and a key point is the extent to which it can expand in areas besides fishing products. GLOBERIDE
hopes to stimulate the global market by developing innovative new products that create market opportunities.
GLOBERIDE largely realized goals of “20% increase in sales, 30% rise in profits, and 40% dividend hike” fromthe medium-term business plan that started in FY3/15 and lasted through FY3/17. It is currently preparing a new
medium-term plan that extends through FY3/21 with an aim of further advances through “higher sales, profits, anddividends.” GLOBERIDE hopes to present the full content of the plan as soon as within the year and no later thanspring 2018. It is on the verge of reaching its near-term target of ¥80,000mn after many years of patience andexpects to surpass the all-time high of ¥80,652mn, which was recorded in FY3/93, in FY3/18.
For shareholder returns, GLOBERIDE plans to increase the dividend by ¥5 from FY3/17’s ¥50 to ¥55 in FY3/18.
The target works out to a dividend payout ratio of 33.3%. GLOBERIDE also has a shareholder gift program thatis helping to expand the number of shareholders. We have a favorable view of proactive shareholder returns while
striking a balance with retained earnings to fund R&D and capital investments needed to create innovative products.
Key Points
Net sales and operating profit roughly flat in FY3/17 consolidated results
Aiming for higher operating profit and all-time high net sales in FY3/18• Steadily raised the dividend for seven straight years, targeting ¥55 in FY3/18••

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Summary㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼚㼑㼠㻌㼟㼍㼘㼑㼟㻌㼍㼚㼐㻌㼛㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻔¥㼙㼚㻕㻺㼑㼠㻌㼟㼍㼘㼑㼟㻌㻔㼘㼑㼒㼠㻌㼟㼏㼍㼘㼑㻕㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㻔㼞㼕㼓㼔㼠㻌㼟㼏㼍㼘㼑㻕㻥㻜㻘㻜㻜㻜

㻠㻘㻡㻜㻜㻤㻜㻘㻜㻜㻜

㻟㻘㻠㻞㻜

㻟㻘㻠㻝㻢

㻟㻘㻡㻜㻜

㻣㻜㻘㻜㻜㻜
㻢㻜㻘㻜㻜㻜

㻠㻘㻜㻜㻜
㻟㻘㻡㻜㻜

㻞㻘㻤㻞㻡

㻞㻘㻣㻠㻠

㻟㻘㻜㻜㻜

㻞㻘㻟㻜㻣

㻡㻜㻘㻜㻜㻜
㻠㻜㻘㻜㻜㻜
㻟㻜㻘㻜㻜㻜

㻔¥㼙㼚㻕㻡㻥㻘㻠㻢㻜

㻢㻣㻘㻟㻤㻟

㻞㻘㻡㻜㻜㻣㻠㻘㻝㻡㻟

㻣㻥㻘㻜㻞㻢

㻣㻥㻘㻝㻠㻞

㻤㻞㻘㻜㻜㻜

㻞㻘㻜㻜㻜
㻝㻘㻡㻜㻜

㻞㻜㻘㻜㻜㻜

㻝㻘㻜㻜㻜㻝㻜㻘㻜㻜㻜㻡㻜㻜㻜㻜㻲㼅㻟㻛㻝㻟

㻲㼅㻟㻛㻝㻠

㻲㼅㻟㻛㻝㻡

㻲㼅㻟㻛㻝㻢

㻲㼅㻟㻛㻝㻣

㻲㼅㻟㻛㻝㻤㻌㻱

Source: Prepared by FISCO from the Company's financial results██Business details and history
Started as a manufacturer of fishing reels for export, DAIWA brandcaptured the hearts of fishing fans
The Company was established in 1955. It was initially named Matsui Manufacturing and mainly manufactured fishingreels for export. It established Daiwa Seiko Corporation in Yamatocho, Nakano Ward, Tokyo in 1958, built a plant
for reel production at the site of the current headquarters in 1960, and also moved the headquarters two years
later. It launched overseas operations with the establishment of Daiwa Corporation in Los Angeles, US in 1966.
The Company revised its company name in Japanese (still Daiwa Seiko in English) in 1969 and listed shares on theSecond Section of the Tokyo Stock Exchange in 1970. It switched to the First Section in 1976.
The Company began as a specialty manufacturer of fishing products, but started to diversify by adding golf products
in Japan in 1972. It moved into tennis products in 1980 and cycling sports products in 1990. It adopted a newname as GLOBERIDE in 2009.
The Company has a corporate motto of “being a lifetime sports company that enriches life,” and its main fishingbusiness is a universally known presence in the fishing world. The brand is very highly regarded, and the Company
has captured the hearts of fishing fans by steadily advancing the concept of fishing goods by consistently delivering
innovative products to the market. The DAIWA brand mark receives robust consumer support as a symbol of “challenge, originality, and innovation.” Support for the DAIWA brand is extensive not only in Japan, but also worldwide.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Business details and history

DAIWA brand markSource: Materials supplied by the Company

In fishing products, the Company proposed an out-spool mechanism for reels ahead of the industry, and thiscreated the template of the modern spinning reel. The Company focuses on more than just reels, rods, and othercore products and offers an extensive line-up of related products including lures, strings, and other small items.
It also handles cooler boxes and rain gear and is a comprehensive supplier of fishing-related items. In Japan, theCompany covers from large chain stores to local specialty shops and “DAIWA fishing goods” is a familiar sign. Muchof product supply goes through direct sales to retailers, and this format keeps the Company in touch with consumer
needs. The Company actively pursues a variety of measures to expand the market, including cooperation in the
TV production of “The Fishing,” the most popular fishing program, and the well-known “Fishing Fool’s Diary” movie
series (seen in reruns on TV).
GLOBERIDE has five sales locations in Japan – Sapporo, Toyama, Tokyo, Osaka, and Fukuoka. Outside of Japan,
it operates Daiwa Corporation in the US and has sales offices in the UK, France, Germany, Italy, Australia, China,
Hong Kong, South Korea, Taiwan, Singapore, and Malaysia. The Company manufactures most of the products atoverseas sites, including Thailand, China, and Vietnam.
DAIWA

Source: Materials supplied by the Company

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Business details and history

In the golf business, meanwhile, the Company delivers two popular brands – ONOFF that proposes products forrefined golfing with reliable quality and FOURTEEN known for superior golf philosophy and excellent performance.
GLOBERIDE does not strive aggressively for higher sales in this business and instead focuses on selling high-end
products and services to customers with emphasis on brands by building membership organizations and conducting
a fitting service that provides clubs best suited to individual customers. It also has contracts with professionals suchas Shingo Katayama, Ryuji Imada, Ji-hee Lee, and Akane Iijima. Success by these top professionals attests to theexcellent reliability of club performance and enhance the brand image.
GLOBERIDE is the sales distributor for PRINCE in Japan for tennis and other racquet sports. It proposes a tennis
lifestyle for adults that covers activities both on and off the court and has carefully cultivated the brand for racquets
as well as tennis wear and other related products. GLOBERIDE handles a wide range of products beyond tennis,
including badminton that attracted interest with strong performances by Japanese athletes in the Olympics andsquash. GLOBERIDE promotes CORRATEC, FOCUS, and BOTTECCHIA brands for cycling sports. It has also
recently launched D-VEC, a new apparel brand that combines functionality and fashion. We expect further new
proposals as a “lifetime sports company.”
ONOFF

Source: Materials supplied by the Company

FOURTEEN

Source: Materials supplied by the Company

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Business details and history

PRINCE

Source: Materials supplied by the Company

CORRATEC

Source: Materials supplied by the Company

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.

27-Jul.-2017

7990 Tokyo Stock Exchange First Section

http://www.globeride.jp/ir/

Business details and history

HistoryYear

Main events

1955

Started manufacturing fishing reels (mainly for export) (Company name: Matsui Manufacturing)

1958

Established Daiwa Seiko Corporation in Nakano, Tokyo

1960

Built a reel manufacturing plant where the headquarters is currently located1962Started domestic reel sales and moved headquarters to the current location

1964

Built a rod manufacturing plant

1966

Established Daiwa Corporation in Los Angeles, US

1969

Changed the Company name in Japanese

1970

Built the Hiroshima and Tochigi plants as domestic manufacturing sites (consolidated at the headquarters in 2000)
Listed shares on the Second Section of the Tokyo Stock Exchange

1971

Established Daiwa Seiko (Taiwan) Co., Ltd. in Kaohsiung, Taiwan (liquidated in 2007)
Established Daiwa Golf Inc. at the current location (absorbed by headquarters in 1995)

1972

Started domestic sales of gold products

1973

Established Daiwa Whitehall Pty. Limited in Sydney, Australia (now Daiwa (Australia) Pty. Ltd.)

1976

Listed shares on the First Section of the Tokyo Stock Exchange

1977

Established Daiwa Sports Limited in Wishaw, Scotland, UK

1980

Acquired Fishing Nakamura Inc. (now, World Sports Co., Ltd.), a Fukuoka-based fishing goods retailer, as a subsidiaryEntered the tennis business
Established Nasu Daiwa Corporation to manufacture and sell fishing goods in Kurobane, Nasu, Tochigi

1984

Established Daiwa France S.A. (now, Daiwa France S.A.S.) in Rouen, France
Established Daiwa Sogo Services Corporation (now Desco Inc.), which handles welfare services, at the current location

1985

Acquired Ooyagi Shoten Inc. (now, World Sports Co., Ltd.), a Tokyo-based fishing goods retailers, as a subsidiary

1990

Established Daiwa-Cormoran Sportartikel Vertrieb GmbH in the suburbs of Munich, Germany
Entered the cycling sports business

1995

Established Daiwa Seiko (Thailand) Co., Ltd. in Bangkok, Thailand

2002

Established Daiwa Seiko Limited in Taichung, Taiwan

2004

Established Daiwa Seiko (Hong Kong) Co., Ltd. in Hong Kong

2005

Established Daiwa Seiko (South Korea) Co., Ltd. in the suburbs of Seoul (Korea).
Acquired Casting Limited., a Tokyo-based fishing goods retailers, as a subsidiary
Established Zhongshan Daiwa Sporting Goods Limited in China
Established Daiwa Vietnam Limited in Da Nang, Vietnam

2008

Acquired Windsor Corporation, a Kanagawa-based sports goods retailer, as a subsidiary
Acquired Fourteen Co., Ltd., a Gunma-based company which manufactures and sells golf clubs, as a subsidiary
Spun off the fishing goods after-service business and established Sports Life Planets, Inc.

2009

Changed the Company name to Globeride, Inc.
Retained DAIWA as the brand name for the fishing business2012

Established Singapore Daiwa Pte. Ltd. in Singapore

2013

Established Dongguan Daiwa Sporting Goods Limited in China
Acquired Daiwa Logistics Services Inc. (now, LOGISPO.Inc), a Tokyo-based warehouse logistics firm, as a subsidiary

2014

Established Daiwa Italy S.r.l in Italy

2016

Established Daiwa Sports (M) SDN.BHD. in Malaysia

Source: Prepared by FISCO from the Company's website

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/██Performance trends
Net sales and operating profit roughly flat in FY3/17 consolidated
results
1. Review of FY3/17 results
GLOBERIDE reported FY3/17 results on May 12, 2017 of flat sales and operating profit with ¥79,142mn in net
sales (up 0.1% YoY), ¥3,416mn in operating income (down 0.1%), ¥2,447mn in ordinary income (down 15.2%), and¥2,184mn in net income attributable to owners of the parent (up 31.6%).
Consumption sentiment remains weak in Japan, and this creates a difficult environment for GLOBERIDE’s productsthat are not daily essentials. However, the Company has been steadily increasing sales in fishing, golf, and racquet
sports by delivering innovative products that capture the interest of people who enjoy these sports.
In fishing, the Japanese fishing market is still only growing at a moderate pace, but GLOBERIDE sales increased
3.5%, outpacing the market average of 1.7%, as its products gained wider support from consumers. While
GLOBERIDE faced tough conditions in 1H because of the impact of inclement weather from August, sales picked
up in 2017 with support from fishing shows and other events in January and February and stimulation of the market
mainly with new products.
Golf sales missed the year-ago level, despite healthy activity for flagship brands, such as ONOFF. Racquet sportsbusiness slowed due to the “Nishikori effect” coming to a full circle that had fueled a tennis boom and shrinkage
of inbound demand.
In overseas business, fishing sales expanded at a healthy pace. While the outdoors market in the US and Europe
is not that vibrant, GLOBERIDE’s efforts to strengthen overseas capabilities in the past few years delivered results.
The Asian market was upbeat as well thanks to rising incomes. Sales rose 15% in the Americas, 8% in Europe, and
13% in Asia and Oceania YoY. However, yen appreciation during the period led to a 2% decline in sales on a yenbasis, despite an 11% gain on a local-currency basis. Golf sales, meanwhile, were sluggish because of reduced
buying in Korea, the main export market. Looking at total global sales, robust domestic fishing offset the decline
in overseas sales.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.

27-Jul.-2017

7990 Tokyo Stock Exchange First Section

http://www.globeride.jp/ir/

Performance trends㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼟㼍㼘㼑㼟㻌㼎㼥㻌㼞㼑㼓㼕㼛㼚
㻶㼍㼜㼍㼚

㻔¥㼙㼚㻕

㻭㼙㼑㼞㼕㼏㼍㼟

㻱㼡㼞㼛㼜㼑

㻭㼟㼕㼍㻌㼍㼚㼐㻌㻻㼏㼑㼍㼚㼕㼍㻤㻜㻘㻜㻜㻜

㻡㻘㻠㻠㻢㻣㻜㻘㻜㻜㻜
㻢㻜㻘㻜㻜㻜
㻡㻜㻘㻜㻜㻜

㻤㻘㻝㻠㻝

㻤㻘㻝㻜㻠

㻥㻘㻜㻜㻥
㻠㻘㻝㻞㻝

㻤㻘㻠㻞㻠
㻠㻘㻟㻞㻤

㻠㻘㻟㻣㻥
㻣㻘㻜㻝㻟
㻟㻘㻤㻞㻠

㻥㻘㻞㻢㻟
㻠㻘㻝㻤㻝

㻡㻞㻘㻝㻢㻡

㻡㻡㻘㻞㻢㻝

㻡㻣㻘㻣㻡㻟

㻡㻤㻘㻞㻤㻠

㻠㻣㻘㻥㻡㻜

㻲㼅㻟㻛㻝㻟

㻲㼅㻟㻛㻝㻠

㻲㼅㻟㻛㻝㻡

㻲㼅㻟㻛㻝㻢

㻲㼅㻟㻛㻝㻣

㻟㻘㻜㻥㻤
㻡㻘㻟㻠㻞
㻟㻘㻜㻢㻤

㻠㻜㻘㻜㻜㻜
㻟㻜㻘㻜㻜㻜
㻞㻜㻘㻜㻜㻜
㻝㻜㻘㻜㻜㻜
㻜

Source: Prepared by FISCO from the Company's financial resultsIn earnings, while yen appreciation lowered raw material costs and other expenses, the strong-yen shift weakened
non-operating income. GLOBERIDE booked a ¥258mn forex loss. There was also an impact from booking ¥329mn inlawsuit-related costs as non-operating expenses. Lawsuit-related costs increased from ¥90mn in FY3/17. However,these costs take the initiative in dealing with patent infringement issues and other areas and can be viewed as a
type of investment.
Capital investments totaled ¥2,714mn as GLOBERIDE invested in the upper ¥2bn range for a fourth straight year.
It had invested in the ¥1,200-1,300mn range through FY3/13. Aggressive investments in the past three years wererelated to boosting the output capacity of fishing-related products to enable realization of the ¥80,000mn sales goalfrom the “Medium-Term Plan 2016” started in FY3/15.

Aiming for higher operating profit and all-time high net sales in
FY3/18
2. Outlook for FY3/18
GLOBERIDE guides for ¥82,000mn in net sales (+3.6% YoY), ¥3,500mn in operating profit (+2.4%), ¥3,000mn inrecurring profit (+22.6%), and ¥1,900mn in net profit attributable to owners of the parent (-13.0%) in FY3/18. Thisoutlook targets all-time high net sales, exceeding the current record of ¥80,652mn.
The Company intends to pursue sales growth in the mainstay fishing goods business at a faster pace than themarket in Japan by continuing to release innovative products. Its plan focuses on drawing customers to retail storesby aggressively stimulating the market through events, sales promotions, and other efforts.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Performance trends

DAIWA’s waterproofing and durability technologies

Source: Materials supplied by the Company

Response to the growing EC market is a key point. While real-world stores, which handle products, are likely tocontinue as the main channel for supplies, reels, fishing rods, and other higher-priced items are shifting to Internet
sales and GLOBERIDE needs to bolster its support for the EC market. EC business involves sales through distributors, and World Sports, Co., Ltd., a subsidiary that handles retail business, is building omni-channel operations.
In overseas business, while forex trends are an uncertainty, we expect sales to expand on a local-currency basis.
GLOBERIDE intends to continue appealing to customers interested in high value-added products, mainly in China
where sales expanded by over 30% in FY3/17.
For golf business, GLOBERIDE focuses on steady sales growth with provision of high-end products and services to“fan” customers while carefully preserving its brands. It utilizes test hitting opportunities and other events as member
perks for ONOFF, FOURTEEN, and other fan clubs to improve brand value and also highlight product features.
Increase in golf sales volume generally overlaps with the timing of new product releases. We expect rebound in
FY3/18 sales due to rollouts of new products for ONOFF LADY this summer and the ONOFF Red Series in spring2018. GLOBERIDE seeks to bolster sales in racquet sports, despite headwind in the income environment fromdecline in the player population, by continuing to strengthen the PRINCE brand.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Performance trends

ONOFF LADY

Source: Materials supplied by the Company

PRINCE

Source: Materials supplied by the Company

The Company plans to continue increasing upfront investment expense, though it expects a rise in operating income
with sales and cost reduction offsetting the expense. It assumes about ¥3,000mn in capital investments for the year.

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http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Performance trends

On the financial front, however, interest-bearing debt increased in the past three years because of ramp-up in capital
investments. Inventories are growing along with rising sales. GLOBERIDE wants to reinforce equity to lift the equity
ratio further from the current 27.7% level. Yet we do not see any issues with the current financial position from thestandpoint of repayment capacity if the Company generates profits as planned.
Past results and forecasts(¥mn)
FY3/15

FY3/16

FY3/17

FY3/18 (E)Net sales

74,15379,026

79,14282,000

YoY

10.0%

6.6%

0.1%

3.6%

2,825

3,420

3,416

3,500

22.5%

21.1%

-0.1%

2.4%

2.918

2,885

2,447

3,000

66.7%

-1.1%

-15.2%

22.6%

1,603

1,659

2,184

1,900

YoY

-44.3%

3.5%

31.6%

-13.0%EPS (¥)

13.94

144.39190.08165.36

Dividend (¥)

4.00

45.00

50.00

55.00

Operating income
YoY
Ordinary income
YoY
Net income attributable to owners of the parent

Note: Conducted a reverse stock split of 10 shares to one share on October 1, 2015; post-split EPS and dividend from FY3/16
Source: Prepared by FISCO from the Company's financial results██Outlook and strategy
Currently formulating a new medium-term business plan that lasts
through FY3/21• Medium-term business plan
GLOBERIDE finished the medium-term business plan lasting through FY3/17 that had final-year goals of ¥80,000mn
in consolidated sales (+18% versus FY3/14), ¥3bn in consolidated operating profit (+30%), and a ¥50 dividend(effectively a ¥15 dividend hike). While sales slightly missed the goal due to the impact of yen appreciation onconversion of overseas value to a yen basis, operating profit reached the goal one year ahead of time and ultimately
overshot by ¥416mn.
Additionally, GLOBERIDE is currently preparing a new medium-term business plan that lasts through FY3/21 withaims of further growth and improved corporate value by sustaining “proactive management.” It has not presented
plan content at this stage, but wants to announce it as soon as within the year and no later than spring 2018.
The new plan will continue the three measures from the previous medium-term plan of pursuing supply capacity for
products with market advantages, stimulating and improving the domestic market, and taking actions in overseas
markets. The final fiscal year is FY3/21 and targets the Tokyo Olympics and Paralympics year. We expect a reasonably healthy environment given the prospect of heightened sports excitement in Japan.

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COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Outlook and strategy

While the domestic market is likely to pick up, we think overseas business will remain the primary source of growth
opportunity. Income levels should be rising in Asia, and these gains are likely to broaden demand for products
related to fishing for leisure. We forecast continuation of a growth trajectory over the next three years thanks to thisaddition to market development room.
While GLOBERIDE is currently preparing the specific sales goal, we think it might target consolidated net sales inthe ¥90,000mn range, judging from 20% sales growth in the previous plan. It hopes to expand top-line sales withfishing as the main driver and is also considering wider peripheral businesses. New investments are part of thereview, including M&A as a possible approach.
GLOBERIDE positions FY3/18 as a preparatory stage prior to embarking on the medium-term business plan and will
actively invest in people and products. This stance explains the prospect of a lower growth rate for operating profit
than sales in FY3/18. GLOBERIDE plans to invest in new product molds and other areas during FY3/18.
Plan formulation also has strong awareness of “post-Olympics” from 2020. GLOBERIDE is likely to move quickly instrengthening the overseas foundation and establishing capabilities to generate profits in these markets in order tosustain a growth trajectory even if domestic demand subsequently weakens.
(1) Fishing product business
Aging is affecting the fishing population in Japan, and the overall trend is moving downward. This environment
raises concern about the future similar to other consumption goods.
GLOBERIDE is addressing the situation by proposing a different type of fishing than in the past and hopes toincrease sales by creating a new market. We think GLOBERIDE is capable of pursuing this strategy because of its
strength of steadily launching innovative products that cannot be produced by rivals. The Company also conducts
activities to raise awareness among young people, such as the Daiwa Young Fishing Club (D.Y.F.C.) started 40
years ago, and takes an aggressive stance to market development.
DAIWA’s technologies

Source: Materials supplied by the Company

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12 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Outlook and strategy

Daiwa Young Fishing Club

Source: Materials supplied by the Company

Yet overseas markets are the primary opportunity for driving future growth. Asia, which is already exhibiting robust
growth, offers clear potential. For example, particularly strong demand for the Company’s high-end products
exists in China from the segment with large incomes even though these items cost a few times more than normal
prices. The fishing style is also changing from simple fishing, mainly for crucian carp and koi carp, to fishing usinglures and reels. Inquiries for high-end products handled by GLOBERIDE are likely to strengthen as income levels
climb in Southeast Asia and other regions.
US and European markets have matured and largely fluctuate with trends in economic activity, but GLOBERIDE still
has substantial room to expand its share. The Company plans to use a strategy of acquiring share by bolstering
the line-up of products that meet regional characteristics.
Fishing show in Italy

Source: Materials supplied by the Company

We encourage readers to review our complete legal statement on “Disclaimer” page.

13 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Outlook and strategy(2) Golf products business
While GLOBERIDE aims to increase its global market share in fishing business, it is not trying to compete forvolume with DUNLOP SPORTS CO. LTD. <7825>, Bridgestone Corporation <5108>, and other firms in the golf
business. Instead it utilizes a strategy of calibration to its position in the industry.
The Company seeks differentiation from other manufacturers and provides high-end products and services tocustomers who are fans of these products with emphasis on nurturing ONOFF, FOURTEEN, and other brands.
Specifically, following on from FOURTEEN, which has a fan club with more than 10,000 members, the ONOFF
brand has started to build a membership organization and enhanced services for brand customers. It promotes
measures that boost customer satisfaction. FOURTEEN follows a strategy of supplying the “best fourteen clubs”
to golfers in order to accumulate sales.
The membership organization holds test-hitting events exclusive to members. These activities put emphasis onfans and pursue steady improvement of brand value and stable sales growth.
CLUB ONOFF membership organization

Source: Materials supplied by the Company

Fourteen Classic golf competition organized by FOURTEEN

Source: Materials supplied by the Company

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14 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Outlook and strategy(3) Racquet sports business
GLOBERIDE utilizes a strategy that nurtures a brand in the tennis business too, similar to golf products. It serves
as the sales agency for PRINCE in Japan. PRINCE triggered a boom with “oversized racquets” and fueled a
revolution in the tennis playing style in the 1970s. This brand has continued to deliver innovations in racquet
technology and actively engages in product creation and promotions that propose an enjoyable tennis life for
adults both on and off the court.
Enjoying adult tennis life off the court

Source: Materials supplied by the Company

Windsor Corporation, a subsidiary running a retail business, is a well-known specialty racquet shop in Japan. It
has a broad range of sales connections that extends from students to adults and also other racquet sport players,
mainly in the Kanto area, and aims to expand sales going forward.

We encourage readers to review our complete legal statement on “Disclaimer” page.

15 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/

Outlook and strategy

Windsor Racquet Shop - Shibuya

Source: Materials supplied by the Company(4) Apparel
Apparel business offers opportunity in the new medium-term plan. GLOBERIDE mainly supplied fishing apparelup to now and is launching an independent apparel brand for the first time. It is developing the D-VEC brandreleased in 2017 as an urban fashion line that combines technology and functionality cultivated over many years
for DAIWA fishing apparel with fashion sense from a dedicated design team.
D-VEC items, which can be worn comfortably even in a harsh fishing natural environment, comprise an extensiveline-up of not only outerwear, but also T-shirts, shorts, shoes, umbrellas, and eyewear. GLOBERIDE opened theEC site and a shop in Harajuku, Tokyo on March 25, 2017. It is proposing sports apparel that makes life fuller inaccordance with the corporate ideal of being a “lifetime sports company” and hopes to enhance corporate value.
D-VEC

Source: The Company's website

We encourage readers to review our complete legal statement on “Disclaimer” page.

16 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.
7990 Tokyo Stock Exchange First Section

27-Jul.-2017
http://www.globeride.jp/ir/██Shareholder returns
Steadily raised the dividend each fiscal year, targeting ¥55 in FY3/18
GLOBERIDE plans to pay an annual dividend of ¥50 per share in FY3/17. The FY3/16 dividend was unusual at ¥27
for the year (essentially ¥45) because of the reverse stock split from 10 ordinary shares to one share conducted on
October 1, 2015. The FY3/17 dividend hence works out to an effective increase of ¥5 or 11.1%.
GLOBERIDE pays shareholder returns while striking a balance with retained earnings that reflects proactive R&D
and capital investments to develop innovative products. However, it has adhered to a positive stance towardshareholder returns with steady dividend increases each fiscal year even in recent years of ramped-up capital
investments. GLOBERIDE will boost the dividend payout ratio to 33.3% (from FY3/17’s 26.3%) if it pays a ¥55 in
FY3/18 as planned.
Additionally, the Company has adopted a shareholder gift program that distributes original QUO cards based on
the number of shares owned and the years of ownership. It explains that this program contributed to an increasein shareholders of roughly 10%.
2017 shareholder incentive QUO card design

Source: Materials supplied by the Company

We encourage readers to review our complete legal statement on “Disclaimer” page.

17 18

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
http://www.fisco.co.jp

GLOBERIDE, Inc.

27-Jul.-2017

7990 Tokyo Stock Exchange First Section

http://www.globeride.jp/ir/

Shareholder returns

㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼐㼕㼢㼕㼐㼑㼚㼐㻌㼜㼑㼞㻌㼟㼔㼍㼞㼑㻌㼍㼚㼐㻌㼐㼕㼢㼕㼐㼑㼚㼐㻌㼜㼍㼥㼛㼡㼠㻌㼞㼍㼠㼕㼛㻔¥㻕㻰㼕㼢㼕㼐㼑㼚㼐㻌㼜㼑㼞㻌㼟㼔㼍㼞㼑㻌㻔㼘㼑㼒㼠㻌㼟㼏㼍㼘㼑㻕㻰㼕㼢㼕㼐㼑㼚㼐㻌㼜㼍㼥㼛㼡㼠㻌㼞㼍㼠㼕㼛㻌㻔㼞㼕㼓㼔㼠㻌㼟㼏㼍㼘㼑㻕

㻟㻟㻚㻟

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㻟㻝㻚㻞
㻞㻤㻚㻣

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㻟㻢㻚㻜
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㻞㻢㻚㻟

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㻟㻜㻚㻜

（㻑）

㻞㻠㻚㻜

㻝㻠㻚㻜
㻟㻡㻚㻜

㻠㻜㻚㻜

㻠㻡㻚㻜

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㻡㻡㻚㻜

㻝㻤㻚㻜
㻝㻞㻚㻜

㻝㻜㻚㻜

㻢㻚㻜

㻜㻚㻜

㻜㻚㻜
㻲㼅㻟㻛㻝㻠

㻲㼅㻟㻛㻝㻡

㻲㼅㻟㻛㻝㻢

㻲㼅㻟㻛㻝㻣

㻲㼅㻟㻛㻝㻤㻌㻱

Note: GLOBERIDE conducted a reverse split that allocated one share per 10 existing shares of ordinary stock on October 1,
2015. Values in this diagram have been adjusted retroactively for years prior to FY3/16.
Source: Prepared by FISCO from the Company's financial results

We encourage readers to review our complete legal statement on “Disclaimer” page.

18 18

Disclaimer
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