FANCL Group Financial Results Briefing...Status of inbound sales (Direct stores) Though some impact...
Transcript of FANCL Group Financial Results Briefing...Status of inbound sales (Direct stores) Though some impact...
For the period April 1, 2018 to December 31, 2018
FANCL Group Financial Results Briefing
January 30, 2019
Financial Highlights
Results by segment
Direct Store Inbound sales (estimated)Sales breakdown (9-month period)
Results by cosmetics brand
FANCL 42,708 +12.6%(Domestic+13.0%、Overseas+8.3%)
ATTENIR 8,806 +3.8%
boscia 2,052 -11.5%
Nutritional supplements 33,855 +26.0%(Domestic+25.3%、Overseas+38.1%)
(Unit: 100 million yen)
3©2018 FANCL CORPORATION All Rights Reserved
(Millions of yen)
Nine-monthperiod of FY to
March 2018
Nine-monthperiod of FY to
March 2019Change YoY
Q3 of FY to March 2018
(10-12)
Q3 of FY to March 2019
(10-12)Change YoY
Sales 81,592 93,316 +14.4% 29,734 33,028 +11.1%
Cosmetics 49,387 54,108 +9.6% 17,963 19,107 +6.4%
Nutritional supplements 26,867 33,855 +26.0% 9,818 11,877 +21.0%
Other 5,337 5,352 +0.3% 1,953 2,043 +4.6%HatsugaGenmai 1,726 1,563 (9.4%) 605 568 (6.1%)
Kale Juice 1,993 1,998 +0.3% 707 727 +2.8%
Operating income 7,035 10,664 +51.6% 3,298 3,581 +8.6%
Ordinary income 7,190 10,604 +47.5% 3,347 3,432 +2.5%
Net income 4,839 7,285 +50.5% 2,354 2,435 +3.4%
11 10 11 14 18 20 23 2640 33 35
17/1Q 17/3Q 18/1Q 18/3Q 19/1Q 19/3Q
©2018 FANCL CORPORATION All Rights Reserved 4
Advertisingcosts
Personnel costs
Other fixed costs
Othervariable costs
Increase in gross profit
due to growth in sales
Improvementin cost-of-sales
ratio
Salespromotions
costs
FY2018Nine-month periodOperating income
FY2019Nine-month periodOperating income
Fixed costsVariable costs
Positive factors Negative factors
(Millions of yen)
Nine-month period results
Analysis of change in Operating income
359
7,035
10,664
98
8,341
2,3141,009
314813
11/1~7週 12/1~7週 1/1~7週
前期 今期Last FY
©2018 FANCL CORPORATION All Rights Reserved 5
Status of inbound sales (Direct stores)
Though some impact seen from new China e-commerce laws, sales continue to trend strongly
Inbound sales by quarter
Full-year plan ¥13.8bn(previous year: ¥8.7bn)
18 2023
26
40
33 3530
1Q 2Q 3Q 4Q
前期 今期
Average weekly sales (YoY)
(+5 compared to plan)
Nov. 2018 Dec. Jan. 2019
Almost no last minute demand seen
Impacted new e-commerce laws,
stricter airport inspections
+48% YoY(Nov., Dec.)
Last FYThis FY
This FY
+19% YoY(through to third week of Jan.)
Last FY
(Ref.) Existing customer trends (YoY)
*Existing customers who have made a purchase in the past 4 months(12-month moving average)
6©2018 FANCL CORPORATION All Rights Reserved
2016 2017 2018
Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec. Mar. Jun. Sep. Dec.
FANCL Cosmetics
Online and
catalogue102% 106% 107% 106% 105% 103% 101% 101% 102% 104% 104% 104%
Direct store 96% 100% 101% 102% 102% 102% 101% 100% 100% 101% 105% 110%
Supplements
Online and
catalogue115% 123% 129% 133% 130% 123% 116% 109% 105% 103% 102% 103%
Direct store 101% 102% 102% 103% 102% 103% 105% 105% 106% 106% 108% 111%
Attenir 98% 106% 113% 122% 125% 125% 125% 122% 121% 118% 112% 108%
Cosmetics Business
©2018 FANCL CORPORATION All Rights Reserved 8
FANCL Cosmetics
■Skincare line renewal
・Moist Refine, Enrich
■WRINKLE CREAM (launched Oct. 2018)
Made a strong start as product capable of
providing an immediate feeling of
skin resilience
Promotions centered around sampling
Sep. 2018
Spring 2019 (Feb., Mar.)
・Whitening line
A unique approach focused on results of
research on the mechanism of skin
spots. For moisture-rich and clear skin
Sales Q3 (YoY) +8%Compared to last renewal +16%
White Force to also be renewed simultaneouslyEnhancing internal and external beauty offerings
Versus plan
Sales 128%
Sampling mainly targeting existing
customers
Q3 Q4Launch large-scale monitor campaign.
Strengthen new customer
acquisitions
Price: ¥3,456 (incl. tax)
©2018 FANCL CORPORATION All Rights Reserved 9
/
Attenir boscia
① New expansions *as of Dec. 2018
US
・Expansion to over 1,000 stores including Ulta, Nordstrom, etc. ・Store opening in Amazon’s Luxury Beauty Category
Europe, Near and Middle East
・Launch of sales to Sephora - 240 stores in Europe and 25 stores in Near and Middle East・Launch of sales to 220 Boots UK stores
Full moisture care linePrima Moist
An evolved form of Inner Beauty Clock skincareLaunch: January 21, 2019
Aging care lineDress Lift
Launch of cross-border e-commerce targeting China
November 2018
Test launch(wholesale sales to
store operators)
From next FY onward
Open own flagship store
Struggling sales to Sephora North America Revising sales plan for this fiscal year
Expecting to return to growth trajectory next fiscal year
×② Expansion of number of items handled
Health Business
©2018 FANCL CORPORATION All Rights Reserved
Naishi Support - Foods with Function Claims
Retention rate(Online and catalogue sales)
TV ad
11
■Major growth through expansion to wholesale channel and active promotion
high
Low
CalolimitEnkin
Naishi Support
Periodic delivery service sales rate
(Online and catalogue sales)
Apr. 2018 Dec. 2018
7 times
60%
Drugstore POS results
High sales results in line with Calolimit
Calolimit
Enkin
18/12
Naishi SupportTV ad
No. of periodic delivery service
customers
18/04 18/07 18/10
Sales
©2018 FANCL CORPORATION All Rights Reserved 12
Cross-border e-commerce targeting China
Line-up of around 40 itemsParticularly strong sales of
Age-Bracket Based Supplements
Successfully launched cross-border e-commerce targeting China on October 30 at Tmall Global
Exhibition booth at the 1st China International Import Expo (CIIE)
Introducing cross-border e-commerce and products
The FANCL booth
Promotion of the FANCL brandand cross-border e-commerce
Future plans
Roll out expansion to JD Worldwide / Kaola.com / Red / WeChatMall
Channel
Launch of new member services in April 2019
©2018 FANCL CORPORATION All Rights Reserved 14
Online and catalogue / Direct store channels
Direct store: New FANCL Shops
Effect of store renovations
・ Light user customer groups +119%
Opening stores in carefully selected high quality locations, and promoting upgrades of existing stores into ‘New FANCL Shops’ with enhanced
internal and external beauty offerings
Online and catalogue: New CRM strategy
No. of customers(Compared with before the previous medium-term management plan)
・Overall +34%Acquired many customers through
advertising-led growth strategy.Plan to intensify development of middle/heavy
user customer groups.
Aim for CRM which creates FANCL fans through preferential treatment and tokens of
appreciation
Evolve point
services
Special gifts
Free shipping for orders over 10,000 yen
NEW NEW
・ Domestic sales (YoY) +5%(compared with non-renovated stores)
[Example proposals]・ BC beauty concentrate + collagen ・ Mutenka FDR + Aller Support
Enhancement of internal and
external beauty offerings
Full year outlook
Full-year outlook to March 2019
16©2018 FANCL CORPORATION All Rights Reserved
(Millions of yen)FY to March 2018 FY to March 2019 Change YoY
Sales 109,019 122,000 +11.9%
Cosmetics 66,048 71,350 +8.0%
Nutritional supplements 35,933 43,700 +21.6%
Other 7,037 6,950 (1.2%)HatsugaGenmai 2,248 2,000 (11.1%)
Kale Juice 2,615 2,650 +1.3%
Operating income 8,448 12,200 +44.4%
Ordinary income 8,650 12,300 +42.2%
Net income 6,191 8,400 +35.7%
Sales breakdown (full year)
Results forecasts by cosmetics brand
FANCL 56,320 +10.2(Domestic+10.8%,Overseas+5.1%)
ATTENIR 11,720 +6.1%
boscia 2,600 -16.6%
Nutritional supplements 43,700 +21.6%(Domestic+21.4%,Overseas+24.8%)
【Assumptions behind the plan】
Inbound sales:13.8bn(The previous fiscal year 8.7bn)
©2018 FANCL CORPORATION All Rights Reserved 17
125
8,448
12,200
399
9,219
2,6151,030
1,160935
Fixed costsVariable costs
Positive factors Negative factors
(Millions of yen)
Plan
Advertisingcosts
Personnel costs
Other fixed costs
Othervariable
costs
Increase in gross profit
due to growth in sales
Improvementin cost-of-sales
ratio
Salespromotions
costs
Full-year outlook: Analysis of change in operating income
FY to March2018
FY to March2019
VISION2030-Make the world healthier and more beautiful-
©2019 FANCL CORPORATION All Rights Reserved 18
2nd Medium-Term Management Plan「ACTION 2020」 ~Creating the future~
ALL‐FANCL,ONE‐FANCL ~NEXT FANCL~
November,2018Free cakes gifted to all personnel
to commemorate record high monthly sales
FY2019~2021 FY2022~2031
VISION2030
Maintain growthtrajectory, raise
profitability. Establish a robust
platform for overseas growth
2nd Medium-Term PlanACTION 2020 Strong growth of
overseas businessTargeting 25% overseas
sales ratio in FY2031
3rd Medium-Term Plan and beyond