Medium-Term Targets of ¥62.5 Billion in Sales and a 7% Operating Margin for the Fiscal Year Ending February 2025

「As a result, for the current interim consolidated accounting period, the Group reported net sales of ¥25,953 million, down 4.0% year on year, an operating loss of ¥499 million, compared with an operating loss of ¥213 million in the same period of the previous year, an ordinary loss of ¥421 million, compared with an ordinary loss of ¥149 million, and an interim net loss attributable to owners of the parent of ¥555 million, compared with an interim net loss of ¥299 million.」

「For the fiscal year ending February 2028, the final year, we have set quantitative targets of net sales of ¥62.0 billion and operating profit of ¥1.3 billion (¥2.5 billion excluding the effects of the partial transfer of the head office site and reconstruction of the head office building).」

「Throughout the medium-term management plan, the Company is promoting expansion of its business domains and markets, using enhanced brand value as leverage, as well as new growth strategies and M&A. For the fiscal year ending February 2028, the final year, it has set quantitative targets of revenue of ¥70.0 billion, an operating profit margin of 7.1% and ROE of 10.7%.」

「Under these circumstances, our group is working diligently to achieve the plan for the current fiscal year, the final year of the Medium-Term Management Plan covering the fiscal years ending February 2023 through February 2025. In addition to continuing business structural reform, we are also focusing on the fundamental strengthening of product capabilities and sales capabilities.」

「For the fiscal year ending February 2024, the Company worked to optimise SCM by strengthening collaboration with key suppliers, curb excess procurement through procurement-pool operations, introduce QR processes for fast-moving products and shorten the merchandising cycle. As a result, the gross profit margin improved by 0.2 percentage points from the previous fiscal year to 62.2%.」

「The current fiscal year is the second year of the Medium-Term Management Plan announced on 14 April 2022. While continuing to work on improving the gross margin and controlling SG&A expenses, the Company completed the renewal of its e-commerce platform in September, and is also opening new physical stores and renovating existing stores. It is actively promoting sales expansion measures aimed at achieving its targets for the final year. As a result, for the cumulative third quarter of the current consolidated fiscal year, the Group reported net sales of ¥44,603 million, up 6.4% year on year, and operating income of ¥1,727 million, up 68.0%.」

「Against this backdrop, our group secured sales above expectations as customer traffic at physical stores, including our core department stores, recovered steadily with the increase in foot traffic and inbound demand, demand for occasion products rose as various events resumed, and spring/summer full-price products performed well overall, helped by the introduction of commemorative products for the 80th anniversary of our founding.」

「The current fiscal year is the second year of the medium-term management plan announced on 14 April 2022. In addition to securing revenue, the Company has continued efforts to improve its gross profit margin and control SG&A to establish a more stable earnings base, while actively investing to put the Company on a growth trajectory, including renewing its e-commerce platform, opening new stores in areas and facilities where it has not previously operated, and renovating existing stores. As a result, the Group's revenue for the cumulative first quarter of the current consolidated fiscal year was ¥15.969 billion, up 11.2% year on year, and operating profit was ¥1.035 billion, up 106.0%.」

「In the first year, the fiscal year ended February 2023, the Company secured revenue above plan as customer traffic recovered at its main sales channels, department stores and directly operated stores, and occasion wear and core cold-weather products such as coats and down jackets performed well as opportunities to go out increased. Gross profit also exceeded plan as the Company continued measures including reducing procurement costs as a percentage of revenue and strengthening inventory controls. SG&A was largely in line with plan, excluding the increase in variable costs associated with higher revenue, as the Company continued to strengthen its management structure and contain expenses, and operating profit consequently remained above plan.」

「The Company achieved operating profitability for the cumulative first quarter, substantially reduced the operating loss for the cumulative second quarter compared with the fiscal year ended February 2022, and returned to operating profitability for the cumulative third quarter. It is also progressing steadily toward achieving its full-year operating profit target.」

「The Company made a solid start in implementing the medium-term management plan announced on 14 April this year, covering the fiscal years ending February 2023 through February 2025, achieved operating profitability in the first quarter, and is now in a position where the likelihood of achieving its full-year operating profit target has increased.」

「For the fiscal year ending February 2025, the final year, the Company set numerical targets of revenue of ¥62.5 billion, a gross profit margin of 63%, an SG&A ratio of 56%, an operating profit margin of 7% and a DOE (dividend on equity) of 2%, and aims to establish a solid earnings base by continuing to drive the structural reforms implemented under the two-year “Revitalisation Plan” from the fiscal year ended February 2021 and achieving further improvements in KPIs.」