Quarterly results

Cumulative		FY03/21				FY03/22				FY03/22		FY03/22
(JPYmn)		Q1	Q1–Q2	Q1–Q3	Q1–Q4	Q1	Q1–Q2	Q1–Q3	Q1–Q4	% of Est.	1H Est.	% of Est.	FY Est.
Sales		48,642	97,389	150,119	200,682	51,991				50.0%	104,000	24.4%	213,000
	YoY	11.1%	10.7%	11.4%	10.6%	6.9%					6.8%		6.1%
Gross profit		20,932	42,055	64,941	86,989	22,473
	YoY	10.7%	10.6%	11.5%	10.7%	7.4%
	Gross profit margin	43.0%	43.2%	43.3%	43.3%	43.2%
SG&A expenses		15,853	32,372	48,833	65,720	17,207
	YoY	6.1%	8.2%	7.8%	7.8%	8.5%
	SG&A ratio	32.6%	33.2%	32.5%	32.7%	33.1%
Operating profit		5,078	9,683	16,108	21,269	5,265				50.1%	10,500	23.9%	22,000
	YoY	28.2%	19.4%	24.3%	20.8%	3.7%					8.4%		3.4%
	Operating profit margin	10.4%	9.9%	10.7%	10.6%	10.1%					10.1%		10.3%
Recurring profit		5,129	9,731	16,166	21,357	5,279				50.3%	10,500	24.0%	22,000
	YoY	28.8%	19.7%	24.1%	20.8%	2.9%					7.9%		3.0%
	Recurring profit margin	10.5%	10.0%	10.8%	10.6%	10.2%					10.1%		10.3%
Net income		3,486	6,602	10,967	14,726	3,526				50.4%	7,000	23.5%	15,000
	YoY	30.5%	20.8%	25.0%	22.0%	1.1%					6.0%		1.9%
	Net margin	7.2%	6.8%	7.3%	7.3%	6.8%					6.7%		7.0%
Quarterly		FY03/21				FY03/22
(JPYmn)		Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Sales		48,642	48,747	52,730	50,563	51,991
	YoY	11.1%	10.3%	12.8%	8.1%	6.9%
Gross profit		20,932	21,123	22,886	22,048	22,473
	YoY	10.7%	10.5%	13.1%	8.7%	7.4%
	Gross profit margin	43.0%	43.3%	43.4%	43.6%	43.2%
SG&A expenses		15,853	16,519	16,461	16,887	17,207
	YoY	6.1%	10.3%	7.1%	7.9%	8.5%
	SG&A ratio	32.6%	33.9%	31.2%	33.4%	33.1%
Operating profit		5,078	4,605	6,425	5,161	5,265
	YoY	28.2%	11.1%	32.3%	11.2%	3.7%
	Operating profit margin	10.4%	9.4%	12.2%	10.2%	10.1%
Recurring profit		5,129	4,602	6,435	5,191	5,279
	YoY	28.8%	10.9%	31.4%	11.5%	2.9%
	Recurring profit margin	10.5%	9.4%	12.2%	10.3%	10.2%
Net income		3,486	3,116	4,365	3,759	3,526
	YoY	30.5%	11.6%	31.8%	14.0%	1.1%
	Net margin	7.2%	6.4%	8.3%	7.4%	6.8%

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

Sales by segment

Cumulative			FY03/21				FY03/22
(JPYmn)			Q1	Q1–Q2	Q1–Q3	Q1–Q4	Q1	Q1–Q2	Q1–Q3	Q1–Q4
Sales			48,642	97,389	150,119	200,682	51,991
	YoY		11.1%	10.7%	11.4%	10.6%	6.9%
	Directly managed stores		47,772	95,812	147,678	197,508	51,192
		YoY	10.9%	10.7%	11.5%	10.7%	7.2%
		% of total	98.2%	98.4%	98.4%	98.4%	98.5%
	Franchised stores		647	1,198	1,781	2,289	538
		YoY	20.3%	15.0%	12.8%	8.6%	-16.8%
		% of total	1.3%	1.2%	1.2%	1.1%	1.0%
	Other		222	378	658	884	261
		YoY	43.2%	-0.8%	-4.4%	-13.8%	17.6%
		% of total	0.5%	0.4%	0.4%	0.4%	0.5%
Quarterly			FY03/21				FY03/22
(JPYmn)			Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Sales			48,642	48,747	52,730	50,563	51,991
	YoY		11.1%	10.3%	12.8%	8.1%	6.9%
	Directly managed stores		47,772	48,040	51,866	49,830	51,192
		YoY	10.9%	10.5%	13.0%	8.6%	7.2%
		% of total	98.2%	98.5%	98.4%	98.6%	98.5%
	Franchised stores		647	551	583	508	538
		YoY	20.3%	9.3%	8.6%	-3.8%	-16.8%
		% of total	1.3%	1.1%	1.1%	1.0%	1.0%
	Other		222	156	280	226	261
		YoY	43.2%	-31.0%	-8.8%	-33.1%	17.6%
		% of total	0.5%	0.3%	0.5%	0.4%	0.5%

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

Sales by product category

Cumulative			FY03/21				FY03/22
(JPYmn)			Q1	Q1–Q2	Q1–Q3	Q1–Q4	Q1	Q1–Q2	Q1–Q3	Q1–Q4
Sales			48,642	97,389	150,119	200,682	51,991
	YoY		11.1%	10.7%	11.4%	10.6%	6.9%
	Sundries		47,738	95,797	147,614	197,024	51,364
		YoY	10.9%	10.7%	11.4%	10.7%	7.6%
		% of total	98.1%	98.4%	98.3%	98.2%	98.8%
	Foods and snacks		889	1,526	2,386	3,487	575
		YoY	23.5%	12.6%	8.7%	3.8%	-35.3%
		% of total	1.8%	1.6%	1.6%	1.7%	1.1%
	Other		14	64	119	170	52
		YoY	-17.6%	42.2%	95.1%	123.7%	271.4%
		% of total	0.0%	0.1%	0.1%	0.1%	0.1%
Quarterly			FY03/21				FY03/22
(JPYmn)			Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Sales			48,642	48,747	52,730	50,563	51,991
	YoY		11.1%	10.3%	12.8%	8.1%	6.9%
	Sundries		47,738	48,059	51,817	49,410	51,364
		YoY	10.9%	10.4%	12.9%	8.4%	7.6%
		% of total	98.1%	98.6%	98.3%	97.7%	98.8%
	Foods and snacks		889	637	860	1,101	575
		YoY	23.5%	0.3%	2.3%	-5.4%	-35.3%
		% of total	1.8%	1.3%	1.6%	2.2%	1.1%
	Other		14	50	55	51	52
		YoY	-17.6%	78.6%	243.8%	240.0%	271.4%
		% of total	0.0%	0.1%	0.1%	0.1%	0.1%

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

Comparable store sales at directly managed stores

Cumulative		FY03/21				FY03/22
		Q1	Q1–Q2	Q1–Q3	Q1–Q4	Q1	Q1–Q2	Q1–Q3	Q1–Q4
Comparable-store sales (directly managed)		5.00%	4.00%	4.50%	3.70%	-0.60%
	Customer count	-0.60%	0.30%	1.20%	0.50%	2.20%
	Customer spend	5.60%	3.70%	3.30%	3.20%	-2.70%

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

Store openings and closures

Cumulative		FY03/21				FY03/22
(stores)		Q1	Q1–Q2	Q1–Q3	Q1–Q4	Q1	Q1–Q2	Q1–Q3	Q1–Q4
Net increase in directly managed stores		23	55	93	109	28
	Openings	32	69	110	141	39
	Closures	9	14	17	32	11
Net increase in franchise stores		-	-	-	-1	-1
	Openings	-	-	-	-	-
	Closures	-	-	-	1	1
Quarterly		FY03/21				FY03/22
(stores)		Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Net increase in directly managed stores		23	32	38	16	28
	Openings	32	37	41	31	39
	Closures	9	5	3	15	11
Net increase in franchise stores		-	-	-	-1	-1
	Openings	-	-	-	-	-
	Closures	-	-	-	1	1

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

Number of stores

		FY03/21				FY03/22
(stores)		Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Directly managed stores		1,656	1,688	1,726	1,742	1,770
	YoY	6.2%	6.7%	7.1%	6.7%	6.9%
	Color the Days	-	1,230	-	1,295	-
	Other than Color the Days	-	458	-	447	-
Franchised stores		46	46	46	45	44

Source: Shared Research based on company data
Note: Figures may differ from company data due to differences in rounding methods.

(Reference) Can Do quarterly results

Store count			May 2020	Aug 2020	Nov 2020	Feb 2021	May 2021	Aug 2021	Nov 2021	Feb 2022
Store count			1,044	1,046	1,065	1,079	1,128
	YoY		2.8%	1.2%	1.4%	2.8%	8.0%
	Directly managed stores		710	705	710	711	719
		YoY	0.7%	-1.7%	-1.7%	-1.1%	1.3%
		Net increase	-9	-14	-9	-8	8
		Openings	5	9	16	16	13
		Closures	14	23	25	25	5
Cumulative (JPYmn)			Mar–May/20	Mar–Aug/20	Mar–Nov/20	Mar/20–Feb/21	Mar-May/21	Mar-Aug/21	Mar-Nov/21	Mar/21-Feb/22
Sales			18,122	36,336	54,302	73,141	18,514
	YoY		0.8%	2.1%	1.4%	1.2%	2.2%
Gross profit			6,881	13,855	20,757	27,970	7,051
	YoY		-0.4%	0.9%	0.4%	0.2%	2.5%
	Gross profit margin		38.0%	38.1%	38.2%	38.2%	38.1%
SG&A expenses			6,473	12,962	19,682	26,267	6,635
	YoY		-0.5%	-1.4%	-1.4%	-1.7%	2.5%
	SG&A ratio		35.7%	35.7%	36.2%	35.9%	35.8%
Operating profit			408	893	1,075	1,702	417
	YoY		1.7%	53.2%	48.7%	41.1%	2.2%
	Operating profit margin		2.3%	2.5%	2.0%	2.3%	2.3%
Quarterly (JPYmn)			Mar–May/20	Jun–Aug/20	Sep–Nov/20	Dec/20–Feb/21	Mar-May/21	Jun-Aug/21	Sep-Nov/21	Dec/21-Feb22
Sales			18,122	18,214	17,966	18,839	18,514
	YoY		0.8%	3.4%	0.0%	0.6%	2.2%
Gross profit			6,881	6,974	6,902	7,213	7,051
	YoY		-0.4%	2.2%	-0.7%	-0.4%	2.5%
	Gross profit margin		38.0%	38.3%	38.4%	38.3%	38.1%
SG&A expenses			6,473	6,489	6,720	6,585	6,635
	YoY		-0.5%	-2.3%	-1.3%	-2.6%	2.5%
	SG&A ratio		35.7%	35.6%	37.4%	35.0%	35.8%
Operating profit			408	485	182	627	417
	YoY		1.7%	166.5%	30.0%	29.8%	2.2%
	Operating profit margin		2.3%	2.7%	1.0%	3.3%	2.3%

Source: Shared Research based on Can Do materials
Note: Figures may differ from company data due to differences in rounding methods.
Note: In order to enable comparisons with the company’s results, cumulative results are calculated based on the sum of quarterly results of three-month periods from March to February of the following year.

(Reference) Watts quarterly results

Store count			May 2020	Aug 2020	Nov 2020	Feb 2021	May 2021	Aug 2021	Nov 2021	Feb 2022
Store count			1,234	1,240	1,269	1,293	1,330
	YoY		3.0%	4.0%	4.4%	5.6%	7.8%
	Directly managed stores		1,208	1,215	1,244	1,268	1,307
		YoY	3.3%	4.4%	4.6%	5.8%	8.2%
		Net increase	10	17	46	70	39
		Openings	28	57	99	131	49
		Closures	18	40	53	61	12
Cumulative (JPYmn)			Mar–May/20	Mar–Aug/20	Mar–Nov/20	Mar/20–Feb/21	Mar-May/21	Mar-Aug/21	Mar-Nov/21	Mar/21-Feb/22
Sales			13,628	26,813	39,507	52,432	12,730
	YoY		5.0%	4.1%	2.7%	1.4%	-6.6%
Gross profit			5,172	10,315	15,229	20,197	4,893
	YoY		5.9%	5.9%	4.8%	2.8%	-5.4%
	Gross profit margin		37.9%	38.5%	38.5%	38.5%	38.4%
SG&A expenses			4,718	9,333	13,755	18,129	4,522
	YoY		0.5%	-0.6%	-1.6%	-2.0%	-4.2%
	SG&A ratio		34.6%	34.8%	34.8%	34.6%	35.5%
Operating profit			454	982	1,474	2,068	371
	YoY		141.4%	180.4%	164.5%	81.9%	-18.3%
	Operating profit margin		3.3%	3.7%	3.7%	3.9%	2.9%
Quarterly (JPYmn)			Mar–May/20	Jun–Aug/20	Sep–Nov/20	Dec/20–Feb/21	Mar-May/21	Jun-Aug/21	Sep-Nov/21	Dec/21-Feb22
Sales			13,628	13,185	12,693	12,925	12,730
	YoY		5.0%	3.2%	-0.1%	-2.7%	-6.6%
Gross profit			5,172	5,143	4,913	4,968	4,893
	YoY		5.9%	5.8%	2.5%	-2.7%	-5.4%
	Gross profit margin		37.9%	39.0%	38.7%	38.4%	38.4%
SG&A expenses			4,718	4,614	4,422	4,374	4,522
	YoY		0.5%	-1.8%	-3.6%	-3.4%	-4.2%
	SG&A ratio		34.6%	35.0%	34.8%	33.8%	35.5%
Operating profit			454	529	491	594	371
	YoY		141.4%	225.6%	137.4%	2.5%	-18.3%
	Operating profit margin		3.3%	4.0%	3.9%	4.6%	2.9%

Source: Shared Research based on Watts materials
Note: Figures may differ from company data due to differences in rounding methods.
Note: In order to enable comparisons with the company’s results, cumulative results are calculated based on the sum of quarterly results of three-month periods from March to February of the following year.

(Reference) Comparable store sales

Source: Shared Research based on data obtained from the companies displayed
*YoY changes in comparable store sales are calculated based on comparisons with corresponding simple three-month averages from the previous financial year.

(Reference) OPM

Source: Shared Research based on each company’s data
Note: Accounting periods between the company and Can Do and Watts vary by one month. For example, OPM from March–May at Can Do and Watts has been displayed alongside OPM at the company from April–June.

(Reference) Average sales and service wages in Tokyo, Osaka, and Nagoya areas

(JPY)		Apr-Jun/20	Jul-Sep/20	Oct-Dec/20	Jan-Mar/21	Apr-Jun/21
Sales and services		1,040	1,054	1,064	1,053	1,059
	YoY	-0.3%	0.4%	-0.4%	-1.1%	1.9%
All categories		1,078	1,086	1,093	1,090	1,091
	YoY	2.6%	2.3%	1.0%	0.8%	1.2%

Source: Shared Research based on Recruit Jobs Co., Ltd. “Survey of Average Wages for Part-time Workers at Time of Recruitment”

Q1 FY03/22 results

Sales: JPY52.0bn (+6.9% YoY)
Operating profit: JPY5.3bn (+3.7% YoY)
Recurring profit: JPY5.3bn (+2.9% YoY)
Net income: JPY3.5bn (+1.1% YoY)

Initiatives

Under the theme “strengthening the ability to adapt to a new kind of daily life,” the company has worked to

Following its opening of a satellite office in Osaka during FY03/21, the company launched a Tokyo satellite office in Q1 FY03/22 with the goals of strengthening product development systems, expanding its customer base, and collecting information. The company has assigned staff from its merchandise division to this new satellite office.

Strengthen relationships with corporate partners that can lead to multiple-store projects and focus store openings in new areas;

Improve efficiency throughout the company through enhanced system utilization. New introductions of self-checkout registers have been delayed due to the end-of-production of the initially selected hardware and time required to select next-generation models. However, the company is optimistic that it can resume introduction of these registers beginning in July 2021. At the 62 stores in which the company has already introduced these registers, it is implementing measures aimed at increasing their rate of usage, including expansion in the range of compatible payment cards.

Store openings and closures, store count, and comparable store sales at directly managed stores

Seria is moving forward with store openings and closures, while monitoring profitability. In Q1 FY03/22, the company opened 39 directly managed stores (32 in FY03/21) and closed 11 directly managed stores (9 in FY03/21) and one franchised store (zero in FY03/21). As of end-Q1 FY03/22, Seria had 1,770 directly managed stores (1,656 at end-FY03/21) and 44 franchised stores (46 at end-FY03/20), totaling 1,814 stores (1,702 at end-Q1 FY03/21).

Comparable stores sales at directly managed stores fell 0.6% YoY. The company reported YoY growth in sales thanks to the cancellation of a state of emergency declared in response to the COVID-19 pandemic in Q1 F03/21. Performance was commensurate with the expectations related to the company’s full-year FY03/22 forecast.

Performance

Sales came to JPY52.0bn (+6.9% YoY).

Sales at directly managed stores were JPY51.2bn (+7.2% YoY). Directly managed stores accounted for 98.5% of total sales (+0.3pp YoY). Franchised store sales were JPY538mn (-16.8% YoY), accounting for 1.0% of total sales (-0.3pp YoY).

By sales category, sales of sundries came to JPY51.4bn (+7.6% YoY), making up 98.8% of total sales (+0.7pp YoY). Sales of foods and snacks were JPY575mn (-35.3% YoY), accounting for 1.1% of total sales (-0.7pp YoY).

Gross profit was JPY22.5bn (+7.4% YoY), with GPM at 43.2% (+0.2pp YoY). The increase in overall GPM was due to a rise in the share of sales associated with sundries, which have a relatively high GPM.

SG&A expenses were JPY17.2bn (+8.5% YoY). The SG&A expense ratio rose 0.5pp YoY to 33.1% mainly due to lower comparable store sales YoY.

As a result, operating profit totaled JPY5.3bn (+3.7% YoY), recurring profit JPY5.3bn (+2.9% YoY), and net income JPY3.5bn (+1.1% YoY).

Seria 2782