Slides
Page 1
The opinions and forecasts contained in these materials are the judgments of the Company at the time of preparation of the materials and do not guarantee the accuracy of the information therein. Actual performance and results may differ significantly due to changes in a variety of factors. Results Briefing Materials for the Fiscal Year Ended October 31, 2024 GIFT HOLDINGS INC. Securities Code 9279
Page 2
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Table of Contents 01 Financial Highlights for the Fiscal Year Ended October 31, 2024 02 Overview of Financial Results for the Fiscal Year Ended October 31, 2024 03 Consolidated Earning Forecasts for the Fiscal Year Ending October 31, 2025 04 Medium-term Business Plan (Fiscal Year Ending October 31, 2025 to Fiscal Year Ending October 31, 2027)
Page 3
01 Financial Highlights for the Fiscal Year Ended October 31, 2024
Page 4
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Financial Summary Net sales 28,472 million yen Year-on-year: +23.9% Strong-performing existing stores Monthly sales per company-owned store hit a record-high thanks to continuous store QSCA enhancement. Refurbishing to improve product quality was also implemented. Overview of financial results Ordinary profit 2,972 million yen Year-on-year: +22.6% Operating profit 2,909 million yen Year-on-year: +23.7% 3 Head office relocation Relocated head office to Shibuya to recruit human resources in a timely and appropriate manner. Leading one-time expenses because of the increase in closed days accompanying the aggressive store refurbishment. Meanwhile, existing stores show a strong performance and opening company-owned stores have also exceeded our target so we have achieved a significant increase in sales and profits. Strengthening production systems Aiming to strengthen production systems against growing demand by starting operation at a new noodle factory at the beginning of this period .
Page 5
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Financial Highlights for the Fiscal Year Ended October 31, 2024 Net sales growth 23.9% (Annual goal: 20.0%) Growth and Profitability All company-owned stores in Japan 125.2% Existing company-owned stores in Japan (Annual goal: 105.0%) 109.0% Company-owned stores 42 stores Produced & franchise stores (Annual goal: 41 stores) (Annual goal: net increase of 48 stores) 26 stores Labor cost rate 24.4% ★★訳不要★★ Hiring employees Newly hired 104 mid-career employees Hired 48 new graduates Retirement rate (Same period of the previous year: 18.3%) 15.4% Operating profit margin 10.2% 4 YoY Change in Net Sales of Company-owned Stores Stores Opened in the Period Man-hour Productivity Recruitment and Retention (Annual goal: 9.5%) Industry average* 26.6% *Source: Summary of 2023 Employment Trends Survey Results (Ministry of Health, Labour and Welfare) 110.7% Full business day Excludes refurbished stores Number of employees 643 people Net sales per man-hour 6,396 yen Company- owned stores 6,501 yen (Same period of the previous year: 6,210 yen) (Same period of the previous year: 6,497 yen) Consolidated (Same period of the previous year: 24.5%) (Same period of the previous year: 26.5%) 26.8% Company-owned stores Consolidated
Page 6
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Results vs. KPIs for the Fiscal Year Ended October 31, 2024 KPI Targets FYE Oct. 31, 2024 Results Growth 1. Net sales growth 20% or above ◯ 23.9% Profitability 2. Operating profit margin 9.5% or above ◯ 10.2% Gain on investments 3. ROA (ordinary profit to total assets) 20% or above ◯ 20.1% 4. ROE (net profit to shareholders’ equity) 20% or above ◯ 24.8% Returns to shareholders 5. Dividend payout ratio 20% or above 19.2% 5
Page 7
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Analysis of Changes in Operating Profit (4Q, 3-months) Operating profit increased 22.8% year on year in 4Q (quarterly accounting period), excluding one-time expenses, due to strong performance of existing stores. ) ) ) ) o t o erati ro it isti stores a era e usto er s e d i rease isti stores o eratio ost i rease rease i u er o usto ers at e isti stores rodu ed store usi ess or orate e e ses ther o t o erati ro it e ludi o e ti e e e ses e store o e i osts losure due to re ur ishi o t o erati ro it Before excluding one-time expenses 112.0% After excluding one-time expenses 122.8% One-time expenses (New stores/refurbishing closures) 6
Page 8
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Analysis of Changes in Operating Profit (Full-year, 12-months) Operating profit increased 33.7% year on year excluding one-time expenses, due to strong performance of existing stores throughout the year. ) ) ) ) t o erati ro it isti stores a era e usto er s e d i rease isti stores o eratio ost i rease rease i u er o usto ers at e isti stores rodu ed store usi ess or orate e e ses ther t o erati ro it e ludi o e ti e e e ses e store o e i osts losure due to re ur ishi t o erati ro it One-time expenses (New stores/refurbishing closures) 7 After excluding one-time expenses 133.7% Before excluding one-time expenses 123.7%
Page 9
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Impact on Operating Profit due to Refurbishing Closures and New Store Opening • For FYE Oct. 31, 2024, a total of 23 stores have been refurbished, affecting operating profit by -147 million yen. (-98 million yen year on year ) • We are planning to refurbish 16 stores for FYE Oct. 31, 2025. Impact on operating profit Full-year -49 million yen Full-year -207 million yen 8 FYE Oct. 31, 2023 Impact on operating profit Full-year -147 million yen YoY -98 million yen Full-year -345 million yen YoY -137 million yen FYE Oct. 31, 2024 Impact on operating profit Full-year (projection) -101 million yen YoY +45 million yen Full-year (projection) -427 million yen YoY -82 million yen FYE Oct. 31, 2025 (projection) 1Q 2Q 3Q 4Q Total Number of refurbishing closure months/stores 0.9 1 5.5 5 1.7 2 3.3 5 11.3 months 13 stores Number of New Stores 8 9 7 4 28 stores 1Q 2Q 3Q 4Q Total Number of refurbishing closure months/stores 1.9 1 8.0 4 17.7 13 7.1 5 34.7 months 23 stores Number of New Stores 6 8 12 16 42 stores 1Q 2Q 3Q 4Q Total Number of refurbishing closure months/stores ------------------------- Pending ------------------------- 23.1 months 16 stores Number of New Stores ------------------------- Pending ------------------------- 52 stores *New store opening costs * * *
Page 10
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Effect of Refurbishment 9 • Operation efficiency has improved due to the new layout, and customer seating turnover rate has increased. • The improved soup quality has made a positive impact on customer traffic. Effect of refurbishment on sales Effect of refurbishment on number of customers *The difference between refurbished and non-refurbished stores after one year following the refurbishment *The difference between refurbished and non-refurbished stores after one year following the refurbishment 9.2% 6.6% 6.6% 5.3% 10.6% 1st month 2nd month 3rd month 4th month 1年後 7.2% 4.9% 4.1% 4.0% 11.3% 1st month 2nd month 3rd month 4th month 1年後 Difference in sales increase rate between refurbished and non-refurbished stores Difference in customer number increase rate between refurbished and non-refurbished stores +10.6 pt +11.3 pt After one year After one year Sales and number of customers increased due to refurbishments
Page 11
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Impact of Price Revisions Customer traffic is steady even after the price revision. There is still room to implement flexible price revisions. 10 Number of customers (year-on-year comparison) Source: Conditions for November 2023 to October 2024 in existing stores 109.8%109.3%107.9%109.8% 105.0% 99.7% 101.3%101.0% 100.0% 104.6%102.7% 97.5% 100.5% 109.9%110.1% 108.6% 112.0% 108.8% 101.6% 103.4% 105.7% 103.1%103.8%102.7% 99.3%101.6% Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov Price revision Year-on-year (compared to FYE Oct. 31, 2023) Number of customers (persons) 103.8% 105.4% Net sales (yen) 109.0% 110.7% Average customer spend (yen) 105.0% 105.0% Source: Conditions for November 2023 to October 2024 in company-owned existing stores FYE Oct. 31, 2024 Price revision Full business day Excludes refurbished stores Full business day Excludes refurbished stores Price revision during the current fiscal year • January 2024: approximately 1% • July 2024: approximately 5% Price revisions have not caused customer numbers to decline. Sales and customer numbers are both steady. FYE Oct. 31, 2025
Page 12
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Existing Company-owned Domestic Stores: Average Net Sales per Store Average monthly sales per company-owned domestic store continue to advance and expand thanks to initiatives to continuously improve store QSCA. *Hit a record-high most recently in August 2024 FYE Oct. 31, 2020 FYE Oct. 31, 2021 FYE Oct. 31, 2022 FYE Oct. 31, 2023 FYE Oct. 31, 2024 ■ Existing stores: Average net sales by month 146% Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. 11
Page 13
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Progress of Human Resource Recruitment Measures We have been actively recruiting human resources to achieve the medium -term business plan. Implemented Planned initiatives ✓ Recruitment website update ✓ Promote cast to regular employees ✓ Recruit overseas ✓ Increased wage levels in January 2024 ✓ Head office relocated in June 2024 ▲ Promoting cast to regular employees (President seminar) • Consider further increasing wage levels Results 21 peopleFYE Oct. 31, 2024 cumulative total Planned April 2025 8 people • Create a human resources development program for overseas • Implement diverse recruitment methods 12
Page 14
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Brand Other Number of stores as of October 31, 2024 2 1 3 10 9 Change compared to end of the previous fiscal year - - - +7 +4 Brand Number of stores as of October 31, 2024 153 39 20 6 4 Change compared to end of the previous fiscal year +22 +6 +10 - - Overseas Status of Stores (Company-owned Stores + Franchise Stores / Breakdown of Change by Brand) 13 *The number of franchise stores has been added to the number of stores from the third quarter of the fiscal year ended October 31, 2024. Overseas A elerated also or the o e i o “BUTA AMA” a d “GA S ABURAD ” stores
Page 15
02 Overview of Financial Results for the Fiscal Year Ended October 31, 2024
Page 16
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Statements of Income FYE Oct. 31, 2023 FYE Oct. 31, 2024 Compared to plan (Unit: Millions of yen) Amount Percentage to sales Amount Percentage to sales Year-on-year % change Full-year plan after upward revision Level of achievement Net sales 22,982 - 28,472 - +23.9% 28,500 99.9% Cost of sales 7,409 32.2% 9,145 32.1% +23.4% - - Gross profit 15,572 67.8% 19,327 67.9% +24.1% - - Selling, general and administrative expenses 13,220 57.5% 16,417 57.7% +24.2% - - Operating profit 2,352 10.2% 2,909 10.2% +23.7% 3,000 97.0% Ordinary profit 2,424 10.5% 2,972 10.4% +22.6% 3,060 97.1% Quarterly profit attributable to owners of parent 1,597 6.9% 1,875 6.6% +17.4% 1,960 95.7% 15
Page 17
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Achievement Rates vs. Full-year Plan 95.7% 97.1% 97.0% 99.9% 当期純利 益 経常利益 営業利益 売上高 (27,600 million yen) (2,700 million yen) 16 (2,740 million yen) (1,750 million yen) Although we were slightly short of the revised plan, we securely achieved the previous forecast. 107.2% 108.5% 107.8% 103.2% Net sales Operating profit Ordinary profit Profit 28,500 million yen 3,000 million yen 3,060 million yen 1,960 million yen Upwardly revised plan (plan before revision) 100.0%
Page 18
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. 161 188 227 10 9 9 511 538 554 10 20 As of Oct. 31, 2022As of Oct. 31, 2023As of Oct. 31, 2024 Open up Stores 682 +65 stores compared to the end of the previous fiscal year Produced stores Company- owned stores Produced stores Company- owned stores Produced stores Company- owned stores As of Oct. 31, 2023 As of Oct. 31, 2024 745 10 stores 20 stores Produced stores Total number of stores 745 stores 810 stores 188 stores 227 storesCompany- owned stores 810 17 Outsourced stores Outsourced stores Outsourced stores9 stores 9 storesOutsourced stores Franchise stores 538 stores 554 stores Franchise stores Franchise stores
Page 19
03 Consolidated Earning Forecasts for the Fiscal Year Ending October 31, 2025
Page 20
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Consolidated Earning Forecasts for the Fiscal Year Ending October 31, 2025 Plan significant increases in net sales and operating profit by steadily implementing the medium-term business plan. FYE Oct. 31, 2024 Results FYE Oct. 31, 2025 Forecast Change (%) Amount Percentage to sales Amount Percentage to sales Net sales 28,472 - 36,000 - +26.4% Operating profit 2,909 10.2% 3,600 10.0% +23.7% Ordinary profit 2,972 10.4% 3,620 10.1% +21.8% Profit attributable to owners of parent 1,875 6.6% 2,200 6.1% +17.3% (Unit: Millions of yen) 19
Page 21
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Assumptions Behind Forecast for the Fiscal Year Ending October 31, 2025 Company-owned stores 105.0% (Number of customers 100.7%, average customer spend 104.3%) Company-owned stores 50 stores in Japan 2 overseas stores Net increase of 51 stores Franchise & produced stores 40 stores in Japan 12 stores overseas Net increase of 52 stores 20 Existing stores sales Store opening plan Produced stores 105.0%
Page 22
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. 58 89 114 140 161 188 227 278 6 6 8 10 10 9 9 9 351 367 410 468 511 548 574 626 Franchise & produced stores Outsourced stores Company-owned stores Store Opening Plan Company-owned stores: +51 stores Produced & franchise stores: +52 stores stores913 682 415 Plan for +103 stores year on year 462 2018 2025 (Plan) Number of stores as of Oct. 31, 2025 (plan) 532 745 618 21 Number of stores 810 913
Page 23
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. 6.25 5.0 10.0 6.0 7.5 9.0 11.0 1.25 7.5 9.0 9.0 11.0 7.5 5.0 10.0 13.5 16.5 18.0 22.0 FYE Oct. 31, 2019 FYE Oct. 31, 2020 FYE Oct. 31, 2021 FYE Oct. 31, 2022 FYE Oct. 31, 2023 FYE Oct. 31, 2024 FYE Oct. 31, 2025 Forecast Returns to Shareholders Consecutive increase in dividend accompanying expanded performance. For FYE October 31, 2025, at this point both interim and year-end will be 11.0 yen each, with annual dividend of 22.0 yen planned. Aiming for a payout ratio of 20.0% or more. Commemorative dividend Interim dividend 22 Year-end Dividend payout ratio Dividend amount (Unit: Yen, per-share basis) 28.0% 88.0% 18.5% 17.5% 20.6% 19.2% 20.0% Note: We implemented stock splits on March 19, 2020, and August 1, 2023, wherein our common shares were split with a ratio of 1:2. The dividend figures per share in this briefing material have therefore been calculated retroactively based on the stock splits.
Page 24
04 Medium-term Business Plan (Fiscal Year Ending October 31, 2025 to Fiscal Year Ending October 31, 2027)
Page 25
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. FYE Oct. 31, 2024 FYE Oct. 31, 2025 to FYE Oct. 31, 2027 Medium to Long-term Target Medium to Long-term Target We are ai i to e a “ o a y that a ser e the est ra e i the orld” as a ediu to long-term target by growing the organic business in Japan and aggressively expanding our business overseas. Ai i to e a “ o a y that can serve the best ra e i the orld” Net sales: 28.4 billion yen Operating profit: 2.9 billion yen Number of stores: 810 24 FYE Oct. 31, 2024 Also grow our overseas business as a revenue source. Business in Japan Overseas business Strengthen overseas business based on stable growth of our business in Japan. Net sales: 52.0 billion yen Operating profit: 5.2 billion yen Number of stores: 1,156 FYE Oct. 31, 2027
Page 26
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Invest Overseas Expansion Invest revenue and experience earned from business in Japan into overseas business in an effective manner. Business in Japan Overseas business Cash and Expertise acquired from business in Japan. Steadily promote overseas expansion ❶Establish a model for thriving stores ❷Expand horizontally to various location types ❸Accelerate store openings 25 and more...
Page 27
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Basic Strategy - Aspirations and Approach 26 billion yen 52.0Net sales billion yen 5.2Operating profit Expansion of business and strengthening of structure Targets to be achieved in FYE October 31, 2027 Promotion of digital transformation (DX)
Page 28
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. KPIs Raise operating profit margin by 0.5 points from the target for FYE Oct. 31, 2024. KPI Targets Growth 1. Net sales growth 20% or above Profitability 2. Operating profit margin 10.0% or above Gain on investments 3. ROE (net profit) 20% or above Returns to shareholders 4. Dividend payout ratio 20% or above 27
Page 29
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Store openings in population concentration areas and areas with high ramen consumption Open stores in regional areas Aim to maximize profit margin Relationship Between Store Opening Strategy and Sales, Profit and Profit Margin By opening company-owned stores in areas with concentrated population that have large markets, and opening produced stores in regional areas, we aim to maximize net sales and profit and also maintain profit margin. Company-owned stores Aim to maximize net sales and profit Franchise & produced stores Strengthening store openings 28 1.57 billion yen 2.35 billion yen 2.91 billion yen 3.60 billion yen 0 0 550 1100 FYE Oct. 31, 2022 Results FYE Oct. 31, 2023 Results FYE Oct. 31, 2024 Results FYE Oct. 31, 2025 Plan 9.2% 10.5% 10.2% 10.0% ■ Number of company-owned stores ■ Number of produced stores Operating profit Operating profit margin Sales ratio Percentage of stores (company-owned stores and produced stores), sales ratio, and the amount of profit and profit margin Maintaining operating profit margin 83.1% 16.9% 16.4% 15.8% 83.6% 84.2% 85.7% 14.3%
Page 30
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Medium-term Business Plan (FYE October 31, 2025 to FYE October 31, 2027) / Quantitative Plan 2023 2024 2025 2026 2027 Net sales 22.9 28.5 36.0 43.0 52.0 (billion yen) (billion yen) (billion yen) (billion yen) (billion yen) Operating profit 2.35 2.90 3.6 4.3 5.2 (billion yen) (billion yen) (billion yen) (billion yen) (billion yen) JapanTotal number of stores 726 stores 783 stores 873 stores 973 stores 1,083 stores Company-owned stores 194 stores 232 stores 282 stores 342 stores 412 stores Franchise & produced stores 532 stores 551 stores 591 stores 631 stores 671 stores Overseas Total number of stores 19 stores 27 stores 40 stores 54 stores 73 stores Company-owned stores 3 stores 4 stores 5 stores 5 stores 5 stores Franchise & produced stores 16 stores 23 stores 35 stores 49 stores 68 stores TotalTotal number of stores 745 stores 810 stores 913 stores 1,027 stores 1,156 stores Company-owned stores 197 stores 236 stores 287 stores 347 stores 417 stores Franchise & produced stores 548 stores 574 stores 626 stores 680 stores 739 stores 29 Created a new three-year plan using the rolling method. Aiming for operating profit of over 5 billion yen in 2027. *For FYE October 31, 2026 and 2027, planned figures assume that existing store sales is 100% YoY.
Page 31
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Variance Against the Previously Announced Medium-term Business Plan Upwardly revised from the previous announcement, backed by the achievement of the store opening plan and strong existing stores. 22.9 27.6 33.2 40.0 2023 2024 2025 2026 28.4 36.0 43.0 52.0 2024 2025 2026 2027 2.35 2.7 3.2 3.8 2023 2024 2025 2026 2.9 3.6 4.3 5.2 2024 2025 2026 2027 Net sales Operating profit(billion yen) (billion yen) FYE Oct. 31, 2025 to FYE Oct. 31, 2027 FYE Oct. 31, 2025 to FYE Oct. 31, 2027 FYE Oct. 31, 2024 to FYE Oct. 31, 2026 FYE Oct. 31, 2024 to FYE Oct. 31, 2026 [Last year’s announcement] [New announcement] Upwardly revised Upwardly revised 30 [New announcement] [Last year’s announcement]
Page 32
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Medium-term Business Plan Key themes Overview of initiatives Expansion of existing business (1) Quality enhancement at each store (2) Improvements in store operation Recruitment (3) Strengthening recruitment capability (4) Measures to reduce turnover (5) Improvement of education system (6) Reexamination of store operation system Strengthening of ability to open stores (7) Advancement of opening business development stores (8) Development of M&A and new business types Overseas expansion (9) Establishing an overseas promotion system (10) Recruitment and training of overseas human resources (11) Establishment of ingredient supply system overseas Strengthening of manufacturing system (12) Reduction of manufacturing costs (13) Enhancement of manufacturing quality (14) Enhancement of in-house production ratio (15) Creation of stable supply systems (by area) Strengthening of purchasing and logistics systems (16) Optimization of logistics costs (17) Stockout risk control (18) Improvement of distribution frequency and distribution quality (year-round next-day delivery) (19) Establishment of a scheme for automated ordering (20) Improved quality and reduced costs of ingredients by scaling up purchasing DX (21) Improvement of customer convenience (22) Reduction of internal man hours and development of a secure work environment (23) Stronger data integration Sustainability (24) Promotion and disclosure of sustainability management 31 NEW NEW NEW PICK UP PICK UP
Page 33
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Medium-term Business Plan ■ Strengthening recruitment capability ✓Measure effect of relocating head office, strengthen employee conversions, strengthen foreigner recruitment 32 PICK UP Recruitment Initiatives to secure human resources ■ Measures to reduce turnover ✓Wage increases, improve in-store working environment, improve overtime system ■ Improvement of education system ✓Establish education system for foreigners in particular ■ Reexamination of store operation system ✓Examine number of employees per store
Page 34
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Medium-term Business Plan Improvement of distribution frequency and distribution quality (year-round next-day delivery) 33 PICK UP Strengthening of purchasing and logistics systems To also improve distribution efficiency accompanying store expansion Expand the number of stores Increase purchasing volume Improve distribution efficiency Improve purchasing conditions Reduce distribution costs Improve distribution quality at less cost • Improve cost performance • Maintain and improve quality by increasing the distribution frequency • Improve operation at stores with limited stocking space
Page 35
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Management Initiatives That Consider the Capital Cost Maintain high ROE for the current capital cost of around 6%, and aim to o trol the shareholders’ equity ost 7.1 5.2 6.2 5.5 7.4 7.1 18.0% 3.6% 29.8% 32.2% 26.2% 24.8% The o a y’s R a d BR tre ds ROE (%) PBR (multiplicative) FYE Oct. 31, 2019 FYE Oct. 31, 2020 FYE Oct. 31, 2021 FYE Oct. 31, 2022 FYE Oct. 31, 2023 FYE Oct. 31, 2024 Shareholders’ equity osts ased o the o a y’s PBR and ROE ROE - Expected growth rate = PBR Capital cost - Expected growth rate ROE - Expected growth rate + Expected growth rate = Capital cost PBR ROE PBR Expected growth rate 24.8% 7.1 times 2 to 3% Various assumptions ROE Use FYE Oct. 31, 2024 average Expected growth rate Assume 2 to 3% from the long-term economic growth rate and the Company’s individual growth rate Risk free rate Refer to the standard 10-year Japanese bond yield Stocks β Refer to our Sensitivity of the Company’s share price to volatility of TOPIX Shareholders’ equity osts ased o A M Risk free rate + Stocks β × (Risk premium – Expected growth rate) = Capital cost Capital cost 3.4 to 4.3% 34 Capital cost 5.2 to 6.0% Risk free rate Risk premium Sto ks β Expected growth rate 0.95% 5% 0.97 2 to 3% Assu ed shareholders’ equity ost 6.0%
Page 36
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Management Initiatives That Consider the Capital Cost Create proper understanding of the business situation through appropriate information disclosure to investors and constructive dialogue, and aim to achieve improved corporate value by providing management with feedback from the dialogue contents. 35 Dialogue situation Feedback to Board of Directors about dialogue contents Individual meetings for analysts and institutional investors 298 times Of which are Japanese investors 231 times Of which are overseas investors 67 times Results Briefing for analysts and institutional investors 2 times, interim and year-end Main responders President & Representative Director Director & Corporate Planning Office Manager Foreign language support • Simultaneous disclosure in English and Japanese of the Results Briefing Materials • Increased scope of disclosure in English text Enhanced disclosure contents • Newly establish sustainability website, provide a wealth of descriptive content • Restructure company website • Create documents for new investors Reflect dialogue contents
Page 37
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Information for the IR Website, QA Station and IR News Distribution Service Other investor relations (IR) materials are available on our English IR website: https://www.gift-group.co.jp/english/ 36 IR website The IR news distribution service delivers IR information e-mails to those registered for the service. IR news distribution service https://www.magicalir.net/9279/mail/index.php Machida Shoten For details of our main brand Machida shoten, please refer to the following website: https://us.machidashoten.com
Page 38
Copyright 2024 GIFT HOLDINGS INC. All Rights Reserved. Disclaimer Notice concerning forward-looking statements ◼The materials and information provided in this announcement include so-called “forward-looking statements.” These are based on assumptions associated with current projections, forecasts and risks and include uncertainty of causing results that substantially differ from these statements. These risks and uncertainties include general domestic and international economic conditions such as general industry and market conditions, interest rates and foreign exchange fluctuations. ◼The Company has no obligation to update or revise the “forward-looking statements” contained in this announcement if new information arises or future events occur. ◼The Company may not necessarily revise announcements on forecasts that have already been made regardless of the occurrence of future events except in cases required under disclosure rules. ◼Information on companies other than the Company is based on publicly available information. ◼This document is neither a solicitation for the application of acquisition of securities nor a solicitation for the application of sale or application of purchase (“solicitation”), is not for solicitation and is not the basis for any contract or obligation. 37