Intensifying competition and deteriorating performance in the beauty business, and impairment loss

「At a meeting of the Executive Committee held on 12 May 2021, we decided to transfer all shares, representing 100.0% of the issued shares, of the following consolidated subsidiaries to TBCグループ株式会社 (hereinafter, TBC). We entered into the transfer agreement on the same date and completed the transfer on 1 July 2021.」

「As we pursued business model transformation, we decided, after taking into account changes in the environment surrounding the beauty business and its future direction, to transfer all shares of the consolidated subsidiaries SWPホールディングス株式会社 and 株式会社ソシエ・ワールド effective 1 July.」

「As we pursued business structure and business model reforms, we decided to transfer the shares after taking into account changes in the environment surrounding the esthetics business and the future direction of 株式会社ソシエ・ワールド’s business.」

「In the beauty business, customer numbers gradually recovered as operations resumed in stages from the latter half of May. However, due to the resurgence of infections toward year-end, sales, including in the major esthetics and hair businesses, remained substantially below both the plan and the previous year. Although we worked to reduce personnel expenses and control advertising expenses, these measures were insufficient to offset the decline in sales, resulting in a difficult outcome.」

「Sales in the beauty business fell sharply due to the suspension of operations. Operations gradually resumed from the latter half of May, and customer numbers gradually recovered. In June alone, sales in both Japan and overseas, including Taiwan, were beginning to recover. As in the previous fiscal year, we will continue consolidating and restructuring unprofitable stores and pursuing structural reform.」

「At 株式会社ソシエ・ワールド in the beauty business, sales fell below the previous year due to intensifying competition in its core esthetics business, sluggish acquisition of new customers and the impact of COVID-19. To restore performance, the company will close unprofitable stores and pursue further cost reductions.」

「At 株式会社ソシエ・ワールド in the beauty business, the core esthetics business produced weak results as competition intensified and the company was slow to respond to diversifying customer needs. While advancing the closure and rationalization of unprofitable stores and reducing costs through expense controls, including the closure of some stores in October, the company is pursuing a fundamental transformation of its business model to reflect changes in customer needs.」

「In the beauty business, 株式会社ソシエ・ワールド’s core esthetics and hair divisions both produced weak results due in part to sluggish customer numbers. Expense controls are under way, and the company will further tighten cost controls.」

「Although 株式会社ソシエ・ワールド has been controlling expenses, both its core esthetics and hair divisions produced weak results due in part to sluggish customer numbers. Going forward, it will further tighten cost controls.」

「Sales have continued to decline due to the diversification of customer needs in the beauty sector and intensifying competition. As a recovery in performance is not expected in the near term, impairment losses on goodwill and other assets totaling ¥12.6 billion were recognized as an extraordinary loss in the current consolidated fiscal year.」