Establishing an earnings base from the upfront investment stage

「As a result, EBITDA was ¥1,748.925 million, up 28.7% year on year, operating profit was ¥1,470.208 million, up 45.7%, ordinary profit was ¥1,598.164 million, up 46.1%, and net income attributable to owners of the parent was ¥931.004 million, up 62.4%.」

「As a result, EBITDA was ¥3,063.906 million, up 33.9% year on year, operating income was ¥2,403.672 million, up 56.6%, and ordinary income was ¥2,561.694 million, up 65.2%. Net income attributable to owners of the parent was ¥1,570.933 million, up 178.0%, partly because the extraordinary loss recognized in the previous year declined.」

「Despite higher M&A-related expenses, fixed costs fell 13.4% year on year to ¥2,816.849 million during the interim consolidated fiscal period, mainly due to operating efficiencies from consolidating headquarters and warehouses. As a result, EBITDA was ¥1,359.166 million, up 53.6% year on year, operating income was ¥1,009.050 million, up 96.4%, and ordinary income was ¥1,093.758 million, up 114.3%.」

「Fixed costs increased 70.7% year on year to ¥6,110.866 million during the consolidated fiscal year due to the M&A. This was mainly attributable to higher goodwill, costs incurred in consolidating warehouses and headquarters to improve group operating efficiency, and upfront collaboration advertising expenses at RBKJ. The Company believes costs can be controlled at a manageable level through the early realization of integration benefits. As a result, EBITDA was ¥2,288.746 million, up 21.8% year on year, operating income was ¥1,535.039 million, down 8.9%, and ordinary income was ¥1,551.117 million, down 9.0%.」

「Fixed costs increased 121.2% year on year to ¥3,825.296 million during the interim consolidated fiscal period due to the M&A. This was mainly attributable to higher goodwill, costs incurred in consolidating warehouses and headquarters to improve group operating efficiency, and upfront collaboration advertising expenses at RBKJ. The Company believes costs can be controlled at a manageable level through the early realization of integration benefits. As a result, EBITDA was ¥884.672 million, down 1.1% year on year, operating income was ¥513.777 million, down 35.6%, and ordinary income was ¥510.462 million, down 36.5%.」

「Operating income fell 10.4% year on year to ¥482.571 million and ordinary income fell 7.7% to ¥502.016 million, resulting in lower earnings. EBITDA, however, increased 11.4% to ¥651.689 million.」

「As a result, driven by the Reebok business during the fiscal year, gross merchandise value was ¥25,914.970 million, up 9.7% year on year. Revenue was ¥13,356.170 million, up 27.6%. EBITDA was ¥1,878.733 million, up 60.6%, operating income was ¥1,685.233 million, up 70.0%, and ordinary income was ¥1,705.344 million, up 76.9%, resulting in higher earnings despite the impact of higher warehouse rent.」

「As a result, driven by the Reebok business during the cumulative third quarter, gross merchandise value was ¥19,742.225 million, up 15.6% year on year. Revenue was ¥10,234.378 million, up 40.9%, and gross profit was ¥7,854.850 million, up 28.6%. To assess underlying growth and profitability, the Group focuses on gross profit after variable costs, an indicator calculated by subtracting variable costs from gross profit, defined as gross merchandise value multiplied by the gross profit-after-variable-costs margin. This measure came to ¥4,233.056 million, up 43.0% year on year, driven by higher gross merchandise value, more efficient logistics flows and web advertising, lower fees and the smooth launch of the Reebok business. As a result, EBITDA was ¥1,715.117 million, up 87.3%, operating income was ¥1,570.702 million, up 99.9%, and ordinary income was ¥1,583.177 million, up 109.1%, resulting in higher earnings despite the impact of higher warehouse rent.」

「As a result, driven by the Reebok business during the cumulative second quarter, gross merchandise value was ¥12,877.843 million, up 19.8% from ¥10,748.471 million in the cumulative second quarter of the previous fiscal year. Revenue was ¥6,584.284 million, up 48.0% from ¥4,450.272 million. EBITDA was ¥894.539 million, compared with ¥492.572 million, operating income was ¥798.205 million, compared with ¥407.582 million, and ordinary income was ¥804.126 million, compared with ¥378.015 million, resulting in higher earnings despite the impact of higher warehouse rent.」

「As a result, driven by the Reebok business during the cumulative first quarter, gross merchandise value was ¥6,767.671 million, up 21.5% from ¥5,571.444 million in the cumulative first quarter of the previous fiscal year. Revenue was ¥3,423.822 million, up 48.9% from ¥2,300.133 million. EBITDA was ¥585.155 million, compared with ¥392.813 million, operating income was ¥538.502 million, compared with ¥350.462 million, and ordinary income was ¥543.650 million, compared with ¥350.726 million, resulting in higher earnings despite the impact of higher warehouse rent.」

「As a result, supported by solid growth in the EC marketplace and platform businesses and the launch of the Reebok business within the brand business, gross merchandise value was ¥23,629.586 million, up 11.4% from ¥21,217.663 million in the previous fiscal year. Revenue was ¥10,464.483 million, up 6.0% from ¥9,875.834 million. EBITDA was ¥1,169.494 million, compared with ¥1,037.962 million, operating income was ¥991.248 million, compared with ¥883.688 million, and ordinary income was ¥963.944 million, compared with ¥852.539 million, resulting in higher earnings despite the impact of higher warehouse rent.」

「Gross profit after variable costs came to ¥2,960.572 million, up 18.5% from ¥2,498.373 million in the cumulative third quarter of the previous fiscal year, driven by higher gross merchandise value, more efficient logistics flows and web advertising, lower fees and the smooth launch of the Reebok business. As a result, EBITDA was ¥915.469 million, compared with ¥816.942 million, operating income was ¥785.670 million, compared with ¥710.257 million, and ordinary income was ¥756.987 million, compared with ¥713.064 million, resulting in higher earnings despite the impact of higher warehouse rent.」

「Gross profit after variable costs was ¥1,744.142 million, up 11.4% year on year, driven by higher gross merchandise value and the suppression of variable costs through more efficient logistics flows and web advertising, as well as lower fees.」

「On the cost side, rent increased due to investment in the new warehouse from the previous fiscal year, but costs were controlled through effective advertising allocation, logistics efficiencies and lower fees. As a result, SG&A expenses were ¥1,651.548 million, EBITDA was ¥392.813 million, up 13.3% year on year, operating income was ¥350.462 million, up 9.7%, ordinary income was ¥350.726 million, up 9.0%, and quarterly net income was ¥367.577 million, up 54.3%.」

「Investment in the new warehouse resulted in SG&A expenses of ¥6,987.671 million, compared with ¥6,269.400 million in the previous fiscal year, EBITDA of ¥1,037.962 million, compared with ¥1,553.635 million, operating income of ¥883.688 million, compared with ¥1,438.397 million, ordinary income of ¥852.539 million, compared with ¥1,448.830 million, and net income of ¥604.516 million, compared with net income attributable to owners of the parent of ¥1,250.045 million in the previous fiscal year.」

「Revenue was ¥7,277.131 million, compared with ¥7,512.543 million in the cumulative third quarter of the previous fiscal year, as the sales mix of D2C-branded products, for which sales prices of products such as YouTuber Hikaru's ReZARD are recognized as revenue, declined. On the cost side, warehouse relocation costs incurred in the cumulative third quarter of the previous fiscal year were eliminated, but rent expenses increased following the partial start of operations at the second warehouse in May 2021. SG&A expenses were ¥5,184.140 million, EBITDA was ¥816.942 million, compared with ¥1,210.059 million in the cumulative third quarter of the previous fiscal year, operating income was ¥710.257 million, compared with ¥1,135.320 million, ordinary income was ¥713.064 million, compared with ¥1,140.744 million, and quarterly net income was ¥540.600 million, compared with quarterly net income attributable to owners of the parent of ¥836.540 million.」

「On the cost side, warehouse relocation costs incurred in the cumulative second quarter of the previous fiscal year were eliminated, but rent expenses increased following the partial start of operations at the second warehouse in May 2021. As a result, SG&A expenses were ¥3,319.959 million, EBITDA was ¥466.521 million, compared with ¥677.111 million in the cumulative second quarter of the previous fiscal year, operating income was ¥406.884 million, compared with ¥630.646 million, ordinary income was ¥409.098 million, compared with ¥638.803 million, and quarterly net income was ¥306.323 million, compared with ¥438.301 million.」

「On the cost side, rent expenses increased following the partial start of operations at the second warehouse in May 2021. However, SG&A expenses were ¥1,627.095 million as warehouse relocation costs incurred in the cumulative first quarter of the previous fiscal year were eliminated. EBITDA was ¥346.655 million, compared with ¥169.845 million in the cumulative first quarter of the previous fiscal year; operating income was ¥319.551 million, compared with operating income of ¥145.370 million; ordinary income was ¥321.905 million, compared with ordinary income of ¥143.240 million; and net income was ¥238.167 million, compared with quarterly net income attributable to owners of the parent of ¥88.476 million.」

「SG&A expenses were ¥6,269.400 million, EBITDA was ¥1,553.635 million, up 1,812.8% from the previous fiscal year, operating income was ¥1,438.397 million, compared with an operating loss of ¥83.494 million in the previous fiscal year, ordinary income was ¥1,448.830 million, compared with an ordinary loss of ¥77.982 million in the previous fiscal year, and net income attributable to owners of the parent was ¥1,250.045 million, compared with a net loss attributable to owners of the parent of ¥256.324 million in the previous fiscal year.」

「In addition to curbing television advertising, on which the Company had spent aggressively through the previous fiscal year to raise awareness, SG&A expenses were reduced through the optimization of web advertising, warehouse logistics operations through measures such as the introduction of automated receiving lanes, and a review of shipping-fee revenue and other items. SG&A expenses were ¥4,623.683 million, EBITDA was ¥1,210.059 million, operating income was ¥1,135.320 million, ordinary income was ¥1,140.744 million, and net income attributable to owners of the parent was ¥836.540 million.」

「In addition to curbing television commercials, on which the company had spent aggressively through the previous consolidated fiscal year to improve brand awareness, the company improved the efficiency of web advertising undertaken during the previous consolidated fiscal year, improved logistics warehouse operations through the introduction of automated receiving lanes, and reviewed shipping fee and other service income. As a result, selling, general and administrative expenses were ¥2,985,968 thousand, EBITDA was ¥677,111 thousand, compared with negative ¥254,955 thousand in the prior-year period, operating income was ¥630,646 thousand, compared with an operating loss of ¥330,963 thousand, ordinary income was ¥638,803 thousand, compared with an ordinary loss of ¥354,364 thousand, and quarterly net income attributable to owners of the parent was ¥438,301 thousand, compared with a quarterly net loss attributable to owners of the parent of ¥354,790 thousand.」

「Gross merchandise volume after returns was ¥18,251,384 thousand, up 29.5% from the previous consolidated fiscal year, and net sales were ¥8,576,462 thousand, up 27.8%. Meanwhile, due to aggressive spending through the first half of the fiscal year on advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥6,519,984 thousand, resulting in EBITDA of ¥81,222 thousand and an operating loss of ¥83,494 thousand, compared with an operating loss of ¥980,049 thousand in the previous consolidated fiscal year.」

「As a result, gross merchandise volume after returns was ¥13,820,188 thousand, up 34.5% year on year, and net sales were ¥6,357,824 thousand, up 31.7%. Meanwhile, due to aggressive spending through the first half of the fiscal year on advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥5,186,696 thousand, resulting in EBITDA of negative ¥70,604 thousand, an operating loss of ¥189,835 thousand, compared with an operating loss of ¥646,626 thousand in the prior-year period, an ordinary loss of ¥207,384 thousand, compared with an ordinary loss of ¥530,597 thousand, and a quarterly net loss attributable to owners of the parent of ¥208,434 thousand, compared with a net loss attributable to owners of the parent of ¥136,424 thousand.」

「Meanwhile, due to continued aggressive spending on advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥3,572,676 thousand, resulting in EBITDA of negative ¥254,955 thousand, an operating loss of ¥330,963 thousand, an ordinary loss of ¥354,364 thousand and a quarterly net loss attributable to owners of the parent of ¥354,790 thousand.」

「Meanwhile, due to continued aggressive spending on advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥1,909,752 thousand, resulting in an operating loss of ¥170,090 thousand, an ordinary loss of ¥182,328 thousand and a quarterly net loss attributable to owners of the parent of ¥185,266 thousand.」

「Meanwhile, due to increased advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥6,152,007 thousand, resulting in an operating loss of ¥980,005 thousand. In addition, the recognition of ¥109,000 thousand in brokerage fees and other expenses related to stock investments as non-operating income resulted in an ordinary loss of ¥862,691 thousand and a net loss attributable to owners of the parent of ¥464,405 thousand.」

「Meanwhile, due to increased advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥4,554,073 thousand, resulting in an operating loss of ¥646,582 thousand. In addition, the recognition of ¥109,000 thousand in brokerage fees and other expenses related to stock investments as non-operating income resulted in an ordinary loss of ¥530,552 thousand.」

「Meanwhile, due to increased advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥2,745,942 thousand, up 96.5% year on year, resulting in an operating loss of ¥424,412 thousand, compared with operating income of ¥62,565 thousand in the prior-year period. In addition, the recognition of ¥109,000 thousand in brokerage fees and other expenses related to stock investments as non-operating income resulted in an ordinary loss of ¥315,891 thousand, compared with ordinary income of ¥49,792 thousand in the prior-year period.」

「Meanwhile, due to increased advertising expenses, including TV commercials, aimed at improving brand awareness, selling, general and administrative expenses were ¥1,372,834 thousand, up 87.6% year on year, resulting in an operating loss of ¥231,828 thousand, compared with operating income of ¥38,523 thousand in the prior-year period.」

「Gross merchandise volume after returns was ¥9,495,271 thousand, up 18.4% year on year, and net sales were ¥3,972,058 thousand, up 37.3%. Selling, general and administrative expenses were ¥2,961,962 thousand, up 31.9%, while operating income was ¥326,514 thousand, up 68.9%, and ordinary income was ¥312,910 thousand, up 59.8%. However, the recognition of ¥103,119 thousand in adjustment to income taxes due to the reversal of deferred tax assets resulted in net income of ¥175,346 thousand, down 41.3%.」

「As a result, gross merchandise volume, including platform services, before returns was ¥8,909,157 thousand, up 18.0% year on year, and net sales were ¥2,810,762 thousand, up 37.6%. Meanwhile, temporary expenses of ¥70,639 thousand, including relocation costs, were incurred in connection with the logistics warehouse relocation carried out in March 2017. As a result, operating income was ¥202,718 thousand, up 28.1% year on year, and ordinary income was ¥190,368 thousand, up 19.8%.」

「As a result, gross merchandise volume, including platform services, before returns was ¥5,757,923 thousand, and net sales were ¥1,761,106 thousand. Meanwhile, temporary expenses of ¥70,639 thousand, including relocation costs, were incurred in connection with the logistics warehouse relocation carried out in March 2017. As a result, operating income was ¥62,565 thousand and ordinary income was ¥49,792 thousand. In addition, a gain on an extraordinary item of ¥15,422 thousand arose from the acquisition of fixed assets accompanying the transfer of the MANGO Harajuku store, resulting in quarterly net income of ¥53,059 thousand.」

「As a result, gross merchandise volume, including platform services, before returns was ¥2,924,472 thousand, and net sales were ¥892,351 thousand. Meanwhile, temporary expenses of ¥70,639 thousand, including relocation costs, were incurred in connection with the logistics warehouse relocation carried out in March 2017. As a result, operating income was ¥38,523 thousand and ordinary income was ¥25,714 thousand. In addition, a gain on an extraordinary item of ¥15,422 thousand arose from the acquisition of fixed assets accompanying the transfer of the MANGO Harajuku store, resulting in quarterly net income of ¥47,550 thousand.」

「We continue to believe that securing and retaining talented personnel is important as we expand the business and establish a profit base.」