第3四半期決算説明会 決算説明会資料｜投資家情報 | TSI HOLDINGS

Announcement of Financial Results for the 3rd

Announcement of Financial Results for the 3rd

Quarter

Quarter

of the Fiscal Year Ending February 28, 2013 (FY2012)

of the Fiscal Year Ending February 28, 2013 (FY2012)

2

I. Summary of Financial Results for the 3rd Quarter

I. Summary of Financial Results for the 3rd Quarter

Cumulative of the Fiscal Year Ending February 28,

Cumulative of the Fiscal Year Ending February 28,

2013 (FY2012)

2013 (FY2012)

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1. Consolidated Financial Highlights - Profit and Loss

Net Sales

137,208 million yen

, Ordinary Income 1,226 million yen

 Ordinary Income: Returned to profitability due to profit on valuation of investment securities.　

 Extraordinary Income: Accrued 2,750 million yen in profit from sales of affiliated company stocks, 454 million yen in gains from sales of fixed assets, and 496 million yen in profit on sales of investment securities.

 Extraordinary losses: Accrued 1,352 million yen loss on valuation of investment securities, 619 million yen in costs relating to the sale of the Vietnam factory, and 525 million yen in costs relating to early retirement.

(Unit:millions of yen)

Previous FY

3rd Quarter Cumulative, FY2012

Results % of Total Results % of Total Y/Y Change Y/Y

Net Sales

122,769 100.0%

137,208 100.0%

+14,438

111.8%

Gross Profit

62,716

51.1%

71,261

51.9%

+8,544

113.6%

SG&A Expenses

65,042

53.0%

71,282

52.0%

+6,239

109.6%

Operating Income

-2,325

-1.9%

-20

0.0%

+2,304

─

Ordinary Income

-3,620

-2.9%

1,226

0.9%

+4,847

─

Income Before Income

Taxes (Qtr)

-1,964

-1.6%

1,714

1.2%

+3,678

─

Net Income (Qtr)

-4,395

-3.6%

134

0.1%

+4,529

─

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 Net Sales:

Alone Decreased due to reduction in total number of stores from closing down of brand and withdrawal of unprofitable stores.

Subsidiaries Companies that merged during the previous fiscal year gave contributions through the full business year.　

 SG&A Expenses: Alone Decrease in SG&A expense rate due to withdrawal of unprofitable businesses.

 Operating Income: Decrease in SG&A expense rate and Deficits were reduced due to contribution of subsidiaries’ profit.

2. Consolidated Financial Highlights - Group (1)

TOKYO STYLE Group

(Y/Y comparison alone/by subsidiary)

(Unit:millions of yen)

Alone Subsidiaries Elimination/

others Total Alone Y/Y Subsidiaries Y/Y

Elimination/

others Total Y/Y

Sales 20,237 31,254 -3,996 47,494 17,863 88.3% 49,472 158.3% -7,366 59,968 126.3%

Gross margin 7,522 15,571 -382 22,712 6,569 87.3% 23,453 150.6% -252 29,771 131.1%

Gross margin rate 37.2% 49.8% 47.8% 36.8% -0.4pt 47.4% -2.4pt 49.6% +1.8pt SG&A 12,868 12,726 1,195 26,790 11,277 87.6% 19,198 150.9% 430 30,906 115.4%

SG&A rate 63.6% 40.7% 56.4% 63.1% -0.5pt 38.8% -1.9pt 51.5% -4.9pt Operating income -5,346 2,844 -1,577 -4,078 -4,707 ─ 4,255 149.6% -682 -1,135 ─ Ordinary income -5,670 2,707 -2,057 -5,020 -3,521 ─ 4,266 157.6% -841 -96 ─

Income Before Income

Taxes (Qtr) -6,663 2,475 -2,316 -6,504 -4,851 ─ 4,278 172.8% -800 -1,373 ─

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SANEI INTERNATIONAL GROUP

 Net Sales: Although first half sales achieved 105.3% compared with the previous quarter, third quarter sales were down to 97.1% compared to the previous quarter due to struggling performance by existing stores, and total third quarter sales were 102.4% compared to the previous quarter.

 Operating Income: Although profits increased in the first half, profits decreased due to a third quarter decrease in gross profit margin and increased SG&A expenses.

3. Consolidated Financial Highlights - Group (2)

(Unit:millions of yen)

Previous FY

3rd Quarter Cumulative, FY2012

Results % of Total Results % of Total Y/Y

Change Y/Y

Sales

75,389 100.0%

77,196 100.0%

+1,806

102.4%

Gross Profit

40,007

53.1%

41,490

53.7%

+1,483

103.7%

SG&A Expenses

38,270

50.8%

39,959

51.8%

+1,688

104.4%

Operating Income

1,736

2.3%

1,531

2.0%

-204

88.2%

Ordinary Income

1,533

2.0%

1,819

2.4%

+285

118.6%

Income Before Income

Taxes (Qtr)

648

0.9%

3,583

4.6%

+2,935

552.9%

Net Income (Qtr)

-170

-0.2%

4,111

5.3%

+4,281

─

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II. Progress of the Mid

II. Progress of the Mid

-

-

term Management Plan

term Management Plan

4. A general Schedule of the Mid-term Management plan

FY2011

Structural reform without sanctuary

Structural reform without sanctuary

Sales：147.8

Operating income：-6.9 Operating income rate：-4.6%

Sales：220

Operating income：5

Operating income rate：2.3％

R

y

Continuous growth

Continuous growth

(2) Improving profitability

FY2012

(The present FY)

FY2013

FY2014

Target 2.

A M

M

Sales：188

Operating income：-0.5 Operating income rate：-0.3%

●

Results

●

the Mid-term

management plan

Target 1.

R P

(1) Reforming cost structure

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●

Forecasts

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5. Core Strategies of the Mid-term Management Plan (1)

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(1) Reforming cost structure

1st Quarter

2nd Quarter

3rd Quarter

4th Quarter

Close low-yielder/unprofitable stores.…Close approx. 297 unprofitable stores of TOKYO STYLE.

Withdraw from unprofitable business…Close four brands of TOKYO STYLE.

Reform the organization of TOKYO STYLE into divisions of each brand business.　

→Clarification of profit responsibility

Sale and closure of some factories

Ｉmplementation of

early retirement support system Cost structure Advertising expenses/Logistics costs/General expenses Discontinuation of branch system at TOKYO STYLE

※Estimated cost reduction accompanying implementation of structural reforms

: y

R

FY FY

FY2013 and later (Full year conversion)

P y y y Personnel costs

─ -500 C Personnel costs -814 -1,953

Staffing structure streamlining due to downsizing Personnel costs -89 -293 Perform a part of the outsourced activities of logistics in-house. Logistics costs -40 -112

Reduce advertising expenses Advertising expenses _{-400 -600}

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6. Core Strategies of the Mid-term Management Plan (2)

(2) Improving profitability

 Consolidate HR, accounting, administration, and system divisions that TOKYO STYLE and SANEI INTERNATIONAL have separately into the Administrative Headquarters of TSI HOLDINGS.

 Establish the Store Development Dept. and Web Business Strategy Preparation Office within the Business Headquarters of TSI HOLDINGS →Consolidate the functions of TOKYO STYLE and SANEI INTERNATIONAL together.

(3) Strengthening group management capabilities

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 Start "Planet Blue World" from spring/summer 2013, which is a store business for casual-style fashion.

 Starting a new type of business of “PEARLY GATES , a golf casual brand, from spring/summer 2013.

1) Development of new business

 Aggressive investments on large-market brands such as "nano・universe,” “NATURAL BEAUTY BASIC,” etc.

 Continue to sell investment securities and unused assets aggressively, and secure the funds for pursuing the Company’s growth strategy for its core business at an accelerated pace while using the funds for repaying debt.

2) Expansion of core brands

3) Effective utilization of assets

1) Concentration of management functions at TSI HOLDINGS

2) Unification of production management functions

 Consolidate and promote rationalization of the production and logistics divisions of TOKYO STYLE and SANEI INTERNATIONAL into TSI HOLDINGS subsidiary, TSI Production Network.

3) Introduce tax consolidation system

 Consolidate the corporate taxes for 16 domestic wholly-owned subsidiaries from 2014 payment → In addition to the merits of integrated taxation, promotion of streamlining of

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III. Policies of Financial Results for the 4th Quarter

III. Policies of Financial Results for the 4th Quarter

Cumulative of the Fiscal Year Ending February 28,

Cumulative of the Fiscal Year Ending February 28,

2013 (FY2012)

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7. Policies of Financial Results for the 4th Quarters

(1) Business policies



F

quarter (Dec.

–

Feb.) is the selling period for autumn and winter products



While minimizing sale discount rates, strive to sell autumn and winter products

(2) Financial policies



Continue to sell investment securities and idle assets by making a decision at appropriate

timing, secure cash reserves to accelerate growth strategy for this business and appropriate

toward repayment of debts.

Effective utilization of assets

2012 December Revenue of Directly Managed Stores (vs. Last Year)



All Stores

　：

95.9

％　　　

Existing Stores

　：

97.6

％

Secure gross profit



Promote group company integration, dissolution, and 100% acquisition of ownership.

Adjustment of group management

Reference

：

Performance plan by group for 2013 ending February

(Unit:millions of yen)

Previous FY 2013 ending February

Results % of Total Plan % of Total Y/Y Change Y/Y

Sales 172,511 100.0% 188,000 100.0% +15,488 109.0%

Operating income -5,902 -3.4% -500 -0.3% +5,402 ─

Ordinary income -11,393 -6.6% 0 0.0% +11,393 ─

Current net income _{-26,983 -15.6% -1,960 -1.0% +25,023} ─

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IV. Reference Data

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8. Net Sales per Brand

(Unit:millions of yen)

Brand Name FY 2012 3rd Quarter_Cumulative % of Total Y/Y

1 nano

・

universe

13,571

9.9%

138.5%

2 NATURAL BEAUTY BASIC

10,673

7.8%

106.1%

3 ROSE BUD

6,869

5.0%

─

4 MARGARET HOWELL

6,557

4.8%

111.7%

5 Apuweiser-riche

4,809

3.5%

─

6 HUMAN WOMAN

4,268

3.1%

96.1%

7 FREE'S SHOP

4,239

3.1%

94.8%

8 & by P&D

4,098

3.0%

104.6%

9 kate spade new york

4,021

2.9%

106.1%

10 PEARLY GATES

3,907

2.8%

113.1%

Others

74,190

54.1%

─

Total

137,208

100.0%

─

* The net sales of ROSE BUD is the consolidated net sales of ROSE BUD CO., Ltd. And Elephant Co., Ltd.

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9. Net Sales per Sales Channel

(Unit:millions of yen) FY 2012 3rd Quarter, Cumulative

TOKYO STYLE GROUP

SANEI INTER NATIONAL

GROUP Consolidates

Sales Channel

Department store

22,492 37.5%

23,404 30.3%

─

45,897

33.5%

21,876 36.5%

41,184 53.4%

─

63,061

46.0%

EC

6,469 10.8%

3,002

3.9%

─

9,471

6.9%

Overseas

_3,292

_5.5%

_2,420

_3.1%

─

5,713

4.2%

Others*

5,837

9.7%

7,184

9.3%

42

13,064

9.5%

Total

59,968

100.0%

77,196

100.0%

42

137,208 100.0%

TSI(Non-consolidated)

Eliminations

Commercial facilities*1

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

In this document, our company's forecast is premised on judgments and presumptions made