results for the second quarter ended september 30, 2019 · 2019. 12. 6. · nantong branch (jiangsu...
TRANSCRIPT
September 12, 2019
Takashige Negishi
President and Representative Director
Yakult Honsha Co., Ltd.
Results for the second quarter
ended September 30, 2019
Future management outlook
Result(exchange-rate
effects)
Initial forecast(announced May 14)
Compared to
initial forecast
Result in previous
yearYear-on-year
Net sales
201.9
{(2.8)}
211.0 95.7% 203.5 99.2%
Operating
profit
23.7
{(0.5)}
25.5 93.1% 23.7 99.7%
Ordinary profit
30.3
{(0.6)}
31.5 96.2% 29.5 102.7%
Profit attributable
to owners of parent
20.6
{(0.5)}
20.0 103.3% 21.3 96.9%
(Figure 1)
(billion yen)
Consolidated financial results (Apr. – Sep. 2019)
Exchange-rate effects are year-on-year values
Amended forecast(exchange rate
effects)
Initial forecast(announced May 14)
Compared to
initial forecast
Result in previous
yearYear-on-year
Net sales409.0
{(4.7)}
420.0 97.4% 407.0 100.5%
Operating profit
46.0
{(1.2)}
48.5 94.8% 45.8 100.3%
Ordinary profit58.0
{(1.4)}
59.5 97.5% 57.1 101.5%
Profit attributable
to owners of parent
39.0
{(1.1)}
36.5 106.8% 34.9 111.6%
Basic earnings
per Share 243.46 yen 227.80 yen217.89
yen
Full-year forecast (consolidated) for year ending March 31, 2020
Exchange-rate effects are values compared to the initial forecast
(Figure 2)
(billion yen)
Country
Marketing Population
(Th. people)
Sales Result Jan. ~ Sep. 2019(bottles per day)
Y o Y(%)
Sales / Marketing pop. (%)
CountryMarketing Population
(Th. people)
Sales Result Jan. ~ Sep. 2019(bottles per day)
Y o Y(%)
Sales / Marketing pop. (%)
Hong Kong 8,180 534,842 96.4 6.54 Brazil 101,290 1,562,390 92.7 1.54
Singapore 5,610 228,144 99.1 4.07 Mexico 94,955 3,876,721 100.3 4.08
Indonesia 200,000 6,204,472 108.3 3.10 USA 327,490 376,606 112.2 0.11
Australia 24,500 252,194 102.3 1.03 Americas Total 523,735 5,815,717 98.8 1.11
Malaysia 24,000 358,793 104.0 1.49 Netherlands 17,285 160,077 94.1 0.93
Vietnam 64,200 517,485 143.4 0.81 Belgium 46,897 77,380 102.0 0.16
India 130,000 245,428 111.9 0.19 UK 70,897 193,703 96.4 0.27
Middle East 20,005 18,409 111.5 0.09 Germany 82,430 73,994 93.0 0.09
Myanmar 5,160 2,138 --- 0.04 Austria 8,747 9,708 80.3 0.11
Guangzhou 84,490 3,063,696 102.3 3.63 Italy 61,000 93,797 95.4 0.15
Shanghai 24,000 594,609 89.5 2.48 Europe Total 287,256 608,659 95.5 0.21
Beijing 30,530 457,867 100.1 1.50 (Consolidated Total) 2,024,796 22,942,734 102.9 1.13
China 593,130 4,040,281 102.2 0.68 Taiwan 23,151 706,367 93.5 3.05
China Total 732,150 8,156,453 101.1 1.11 Thailand 66,410 2,200,766 96.1 3.31
Asia/Oceania
Consolidated Total1,213,805 16,518,358 104.7 1.36 Korea 51,650 3,156,310 94.3 6.11
Philippines 91,400 3,221,358 104.2 3.52
(Equity method Total) 232,611 9,284,801 97.9 3.99
Total 2,257,407 32,227,535 101.4 1.43
Countries and Regions Information (Figure 3)
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
2002 2004 2006 2008 2010 2012 2014 2016 2018
The Progression of the Daily Sales of Dairy Products in China Thousands bottles per Day
International Business (China1)
• Spending slump in response to
Sino-America trade issues
• Introduction of competing
products by local dairy companies
• Expansion of e-commerce
Regional Developments
• Marketing Population: 730 mil.• Daily Average bottle sales: 8 mil.• Population Ratio:1%
(1 consumer per 100 people)*The developed market of Guanzhouhas a pop. ratio of 3%
• Retail based market development
YearFUTURE
• Enlargement of newly entered sales
areas
• Development of existing sales areas
• Enhancement of the home delivery
channel
Mid – Long Term Business Growth
Jan.-Sep.2019
(Figure 4)
54.6% 50.9%
7.9% 7.6%
32.5% 34.5%
4.0% 5.8%
0%
20%
40%
60%
80%
100%
Jan.-Sep.2018 Jan.-Sep.2019
E-Commerce
Other
Independent Store
CVS
Hypermarket /Supermarket
Answering Regional Developments (China2)
• Increase presence in “Independent Stores”
• Look to develop new sales channels in schools and hospitals etc. as part of “Other”
E-Commerce : 1.0% 1.3%• Introduction of an IT System
Creating New Relationships with Customers
Market Share Breakdown in the Retail Channel Efforts in the Home Delivery Channel
・Introducing electric bicycles, to reduce physical labor
• Reducing the load and optimization- Accepting orders through SNS (WeChat)- Increasing convenience for customers through cashless payments
Regarding the fall in Hypermarket/Supermarket Share
• The “E-Commerce” section is growing, but as chilled products are a limiting factor, we will develop with the few companies which can guarantee both price and chilled distribution.Paying close attention to the local developments, and reacting flexibly
(Figure 5)
Marketing population
Branches started sales in Jun. 2019:Lanzhou Branch (Gansu Province)Nantong Branch (Jiangsu Province)Shaoxing Branch (Zhejiang Province)
Marketing pop. at end of Jun. 2019 732.15 million
Marketing population
Marketing pop. at end of Dec. 2018 718.24 million
13.91 million increase
Mid-Long Term Initiatives
Lanzhou Branch
The Wuxi 2nd Plant Building due to commence operations in April, 2022
Our strategic dominance within the coastal area’s sales points continues, as we continue to build our meticulous sales network
Nantong Branch
Shaoxing Branch
Open multiple sales bases every year to continue to enlarge and develop the market
Production network (million bottles/day)
Plant nameNo. of bottles
producedYakult
YakultLight
Guangzhou No. 1 Plant 1.6 1.6 0
Guangzhou No. 2 Plant 2.0 1.6 0.4
Shanghai Plant 1.7 1.7 0
Tianjin Plant 3.5 2.7 0.8
Wuxi Plant 2.2 1.4 0.8
Foshan Plant (March) 1.6 0.4 1.2
Wuxi Plant 2nd plant building (June)
1.6 1.6 0
Total 14.2 11.0 3.2
(As of end of Sep. 2019)
(Figure 6)
International Business (Myanmar)
Manufacturing and selling of Yakult in Myanmar began on August 1, 2019
Yakult Myanmar Co., Ltd.
Thilawa Special Economic Zone, Yangon, Myanmar
Yangon Laos
Cambodia• Sales region: Yangon and the surrounding area
(to be expanded in response to sales
performance)
• Sales channels: Home delivery with Yakult Ladies
Retail through supermarkets and
other stores
• Bottle sales target: 18,530 bottles per day
(average sales Aug. – Dec. 2019)
(Figure 7)
International Business (The Americas)
<Mexico>• Thanks to meticulous market development, the
sustained increase in bottle sales continues.
• We reduce the losses in sales and profits caused by inflation through annual price revisions.(A price increase of 6% in home delivery and 5.4% in retail stores was introduced in Feb. 2019)
Hawaii
Alaska
5,751 5,789 5,820 5,816
0
1,000
2,000
3,000
4,000
5,000
6,000
Jan. - Dec.2016
Jan. - Dec.2017
Jan. - Dec.2018
Jan. - Sep.2019
The Progression of the Daily Sales of Dairy Products in the Americas
USA Brazil Mexico(Thousands of bottles/day)
Mexico is the driving force behind the stable revenue base of the Americas.
The 6 states first entered
2016 expansion (19 states)2017 expansion from November (4 states)
2017 expansion from June (6 states)
2019 expansion from July (15 states)
<USA>• Sales began originally and were developed in 6
States in the South West (which are now a growth driver for the whole market)
• We used the know-how we cultivated in those 6 states to develop sales in other areas
• With sales starting in 15 eastern states in July 2019, we have incrementally expanded our sales area to the entire country
(Figure 8)
Pharmaceutical Business
Initial Projection Revised Forecast Difference
Campto 900 900 0
Elplat 10,400 11,500 1,100
Others 6,200 6,600 400
Sales (combined) 17,500 19,000 1,500
Operating profit (loss) (1,400) (1,000) 400
Ongoing Initiatives・ Alliances with other companies
- Signed promotion agreement for liposomal irinotecan with Nihon Servier Co., Ltd. in Oct.
・ Continued launch of new generic drugs- Capecitabine and Gefitinib launched in June
・ Roll out products in-licensed from other companies - Signed exclusive licensing agreement with Verastem Oncology for development and
commercialization of duvelisib in Japan in June 2018
Background to revised forecasts・ Drug price revision
- The drug price reduction in October 2019 was 12%, larger than the 7% we expected
・ Elplat- Successful provision of information via MRs allowed us to revise our initial sales projections upwards
- Rate of replacement with generic drugs was 51.3% at end of Sept. (50.6% at end of June)
(Figure 9)
Yakult concentrated its R&D and technological capabilities to realize 100 billion L. casei strain Shirota in each bottle. The
resulting fermented milk drink has the highest concentration and number of probiotic bacteria of any product in Yakult’s history
Yakult’s first product labelled as a “Food with Function Claims”・ Improves sleep quality and Relieves stress in situations that cause temporary mental stress
・ Effective in improving the gut environment by L. casei strain Shirota
※ Recommended retail price: 130 yen / bottle, 910 yen / 1 pack (7 bottle / 1 pack) (Exclusive of tax)
※ Launch in Ibaraki Prefecture, Tochigi Prefecture, Gunma Prefecture, Saitama Prefecture, Chiba
Prefecture, Tokyo Prefecture, and Kanagawa Prefecture
※ Sales channel: Home delivery channel by Yakult lady, etc.
New product for release
Yakult 1000
(Figure 10)
Yakult 400 W
New product for release
The “Yakult 400” Brand Product, with the appeal of “Synbiotics”*
• 1 bottle (80ml) contains 40 billion Lactobacillus casei strain Shirota, which reach the gut alive
• Each bottle contains 5.0g of the companies own unique “galacto-oligosaccharide” ingredient, which increases the
bifidobacteria in the gut
• The well loved taste of Yakult with an added sense of refreshment and healthfulness, making continued drinking a
pleasure
*“Synbiotics” are made of a combination of “Probiotics”; the microorganisms which work to improve the gut, such as Lactobacillus and
bifidobacterium, and “Prebiotics”; those ingredients which help to increase the helpful bacteria.
※Recommended retail price: 100 yen / bottle, 700 yen / 1 pack (7 bottle / 1 pack) (Exclusive of tax)
※Launch in Kyushu region
※Sales channel: Home delivery channel by Yakult Lady
(Figure 11)
Current initiatives (Home delivery channel)
Extend educational provision
Create a more productive home delivery system Online ordering for home delivery
Enhance employee benefits
• Enhance welfare provisionfor Yakult Ladies (set up health line, caregiving & financial planning advisory services, etc.)
Online paying-in system Mobile devices
• Boosted communication skills & impart knowledge
• Share success stories & nurtured sense of togetherness
• National introduction from Sept. 2018• Supports cashless payment (credit card) • Can collect deliveries even when out during
the day• Availability of home delivery exclusive
products
Improve work setup
Yakult Delivery Net
(Figure 12)
Statements contained in these materials with respect to Yakult's
plans, forecasts and other statements that are not historical facts
are forward-looking statements that involve risks and
uncertainties that could cause actual results to differ
substantially from expectations.
The information contained in these materials is not intended as a
solicitation for investment. Furthermore, Yakult does not
guarantee the accuracy of the contents of these materials. Yakult
and the provider of these materials disclaim any responsibility
for any loss or damage that should arise from the use of this
information.
CAUTIONARY STATEMENT