Materials for Supplementary Explanation

Transcription

1 Materials for Supplementary Explanation Golf Digest Online Inc. (Securities Code: 3319)

2 Note to this material Plans, forecasts and strategies, etc. of the Company contained in this material include potential risks and uncertainties, except for elements that have already been fixed, and do not guarantee their contents. Potential risks and uncertainties include, but are not limited to, economic conditions centered on consumer spending trends, trends in the golf market, which is the main business domain of the GDO Group, and the overall Internet market, competition in the market and the rapid innovation of technologies, etc. Because consolidated financial statements for FY2013 are not prepared, nonconsolidated financial results are used for the financial results for FY2013. The unauthorized copying of this material and the data therein is not permitted. 2

3 Overview 3

4 Company Profile Company Name Golf Digest Online Inc. (GDO) URL: Date of Establishment May 1, 2000 Listed on the Tokyo Stock Exchange Mothers Market on April 1, 2004 Listed on the Second Section of the Tokyo Stock Exchange on May 1, 2015 Listed on the First Section of the Tokyo Stock Exchange on September 7, 2015 (Securities Code: 3319) President and CEO Nobuya Ishizaka Head Office Higashi-Gotanda, Shinagawa-ku, Tokyo Capital 1,458 million Employees (Consolidated) 544 *Including part-time employees (As of the end of December 2017) 4

5 Service of GDO group GDO Total golf platform Golf media Events Golf course booking Database Golf lessons Custom club fitting Other offline channels Sales of Golf equipment Stores 5

6 Build an ecosystem for golf and provide it with full support. Golfers in Japan: Approx. 5.5 million people Online Offline Online channel: Monthly average number of visitors* 5.87 million (up 9% year on year) GolfTEC by GDO Golf Garage Number of golfers booked on GDO Competitions /events hosted Total app downloads 1.90 million (up 46% year on year) Number of likes on Facebook 1.31 million (up 5% year on year) Offline channel: Monthly average number of users 540,000 (up 15% year on year) *Sum of monthly average numbers of unique users of PCs and mobile devices Enjoy golf (Results in FY2017) 6

7 GDO Club Members (millions of people) Approx. 60% of golfers in Japan are GDO Club Members As of December million people 7

8 User Profile GDO users: Characterized by business influence and high purchasing power as an individual. (As of the end of December 2017) Gender ratio Age group 86% of users are males Average age 49, 30s 50s 3/4 Annual income Average golf score -Intermediate level with an average score in the 90 range 31% -Many golfers aim to achieve the 80 range on a stable basis. Occupation - 2 million 2 million- 4 million- 6 million- 8 million- 10 million- 15 million- 20 million - 10 million or more 24%, 8 million or more 40% -Company executives + Management level employees + Self-employed 32% -Many users have business influence. 8

9 Environment Surrounding GDO 9

10 Golf course booking Booking on GDO is possible at around 90% of golf courses in Japan Changes in the number of golf courses in Japan and the number of golf courses bookable on GDO Number of golf courses Number of golf courses around the world 1st USA 15,047 courses 2nd Canada 2,295 courses 3rd Japan 2,290 courses *Prepared by GDO based on Golf around the world 2017 (Royal and Ancient Golf Club of Saint Andrews (R&A)). *Source: Changes in the Number of Golf Courses and Users based on Taxation Status of Golf Facility Taxes (November 2017) (Nihon Gorufujo Keieisha Kyokai) 10

11 Golf course booking The total number of golf course users remains flat, but GDO users are increasing. Percentage of golf course users comprised of GDO users 2003: 0.6% 2016: 6.2% Changes in the total number of golf course users in Japan and the number of GDO users Total number of golf course users in Japan (millions people) Number of GDO users (millions people) *Source: Changes in the Number of Golf Courses and Users based on Taxation Status of Golf Facility Taxes (November 2017) (Nihon Gorufujo Keieisha Kyokai) 11

12 Golf becomes more familiar due to lower green fees. Changes in green fees and the annual number of plays Green fees (yen) Number of plays per golfer (times) *Source: Green fees are prepared by GDO based on net sales and total users in Survey of Selected Service Industries (Golf Courses) of the Ministry of Economy, Trade and Industry. Number of plays is based on Leisure White Paper (Japan Productivity Center). 12

13 Golf equipment market in Japan (billion yen) Golf retail The golf equipment market is shrinking, but sales of GDO are increasing. Percentage of golf equipment market comprised of EC market 2003: 1.8% 2016: 12.5% Changes in the golf equipment market in Japan and net sales of golf equipment of GDO The golf equipment market has an overwhelming size comprising approx. 20% of the sports equipment market Net sales of golf equipment of GDO (billion yen) Sales ranking of golf equipment retailers in Japan 1st 2nd 3rd 4th Company A (sports volume retailer) Company B (sports volume retailer) Company C (golf volume retailer) Company D (golf volume retailer) 73.5 bil bil bil bil. 5th GDO 14.8 bil. Golf equipment EC market (excluding store sales) Net sales 1st *Source: Leisure White Paper (Japan Productivity Center) 13

14 Major Businesses 14

15 Sales of Golf Equipment (Online Sales/Store Sales) Strengths of GDO One of the world s largest with the most extensive selection of goods Differentiated information power Provision of high-quality services Number of items dealt with Approx. 100,000 new items and approx. 40,000 used items Number of brands dealt with: Approx. 370 brands in Japan and overseas Major services Online sales of golf equipment Purchase/sales of used golf equipment (Online/offline: 5 Golf Garage stores in Kanto) GDO Golf Shop Golf Garage store Stores also opened on the following websites: Yahoo! Shopping, Yahoo! Auction Amazon.co.jp, Rakuten Ichiba, and LOHACO (opened on September, 2017) 15

16 Sales of Golf Equipment Percentage of consolidated net sales Approx. 70% Results in FY2017 Percentage of consolidated gross profit Approx. 40% Results in FY2017 YoY changes in the amount of orders received *Market: Golf equipment market (golf clubs, balls, accessories) Year-on-year changes in the market size estimated based on actual sales of actual stores of major dealers dealing with major golf equipment nationwide calculated by GfK LifeStyle Tracking Japan. 16

17 Golf Course Bookings Strengths of GDO One of Japan s largest and most extensive information volumes Commercialization power taking potential demand in advance Provision of high-quality services Number of partner golf courses 2,000 courses or more (Including Overseas: Hawaii, Guam, American mainland, Singapore, Thailand, Malaysia, Australia, etc) Major services -Domestic- Golf course booking (Internet/phone/app) GDO Premium Club Hosting of competitions and events Sales of a web booking system for golf courses -Overseas- Overseas golf course booking (Internet) Sales of a web booking system for overseas golf courses 17

18 Golf Course Bookings Percentage of consolidated net sales Approx. 25% Results in FY2017 Percentage of consolidated gross profit Approx. 50% Results in FY2017 Changes in golfers booked on GDO (players) (YoY) *Market: Source: Ministry of Economy, Trade and Industry Survey of Selected Service Industries. Comparison of total golf course players of eight prefectures (Hokkaido, Miyagi, Tokyo, Aichi, Osaka, Hiroshima, Kagawa and Fukuoka) 18

19 Golf Media Strengths of GDO Overwhelming information volume and high-quality content Distinctiveness and swiftness of news Response to diverse devices Viewer rate in the golf category No.1 in Japan Major services Golf media (news, BRUDER, club information) Internet advertising/marketing service Mobile services (free/pay-per-use services) GDO Card Strategic alliance partners PGA tour (USA), European tour, Asian tour, the Golf Digest in the USA 19

20 Broadening of Golfer Population GolfTEC by GDO (Subsidiary) Strengths of GolfTEC by GDO Differentiated lesson method Provision of high-quality services Realization of experience-based store Lesson studio of GolfTEC by GDO Systems and know-how of GolfTECH Intellectual Property, LLC *, the USA s leading golf lesson chain, have been exclusively introduced in Japan in alliance with this company. Club fitting service Stores GolfTEC by GDO Roppongi, Ebisu, Ginza, Kanda, Ikebukuro, Ginza ANNEX, Yokohama Sakuragicho, Shinjuku, Osaka Umeda, Nagoya(opened on February, 2018) (stores: 8 stores in Kanto, 1 store in Kansai and 1 stores in Chubu) Major services Swing diagnosis Complete golf lessons Sales of GDO s custom club fitting Lesson approach that visualizes improvement *GolfTEC Intellectual Property, LLC Head office: Denver, Colorado, USA Established: 1995 Bases: More than 175 bases across the USA and bases in Canada and South Korea Remarks: Has a share of 25% or more of the golf lesson market in the USA. 20

21 Mid-Term Strategic Plan 21

22 History until 2015 Mid-term strategic plan ( ) 3 years to enhance the growth base Thorough operation of specialized business/ regrowth Sept. 2015: Market change to the 1st Section of the TSE Completion of Tricycle business model Full renewal of IT/management base May 2000: Established April 2004: Listed on the TSE Mothers Change of book closing month Net sales Operating profit Jul.-Dec. 22

23 Achieved targets in the previous mid-term strategic plan ( ). Thorough operation of specialized business/regrowth Thoroughly specializing in the golf category Selection and concentration of management resources Establishment of the financial base Building a structure for specializing in the golf category Return to growth path Market change to the 1st Section of the TSE(restration of financial health) Net sales 13.5 bil bil bil. Up 20% or more from bil. (Up 29% from 2013) 800 mil. or more 820 mil. Operating profit 50 mil mil. 290 mil

24 2016: Business Development Policy Second business development stage: Rebuild GDO with concerted efforts. GDO NEXT from Scratch Existing businesses Overwhelmingly strengthen them with concerted efforts. Accelerate growth with synergy effect. Accelerate growth with synergy effect. New businesses Utilization of customer assets x Alliance Overseas businesses Challenge of the USA/Asia 24

25 Strategic Policies of the Mid-Term Strategic Plan ( ) What is GDO NEXT from Scratch? GDO NEXT = The second business development stage commenced in from Scratch = Zero-based restart + Awareness of the professional level of a scratch golfer Japan s environment will be significantly affected by the low birthrate and aging population if this situation continues. The golf market also appears to be readily influenced by this (the central layer of golfers are in their 50s to 70s, and the central layer of GDO Club Members are in their 40s to 50s). However, GDO will maintain high growth for the next three years for three reasons: (1) Rising physical strength age (2) Diversified styles for enjoying golf (3) Further penetration of Internet services Scratch : Newly creating from zero. from Scratch = from the beginning from zero : It also means a golfer with a zero handicap. 25

26 Numerical Targets in the Mid-Term Strategic Plan ( ) Net sales: Double-digit average annual growth rate or more Operating profit: More than 2 billion in the final year Dividend yield: Maintain 20% Double-digit average annual growth rate or more Net sales 18.0 bil bil bil. More than 2.0 bil. Operating profit 0.82 bil. 0.9 bil bil

27 Earnings Forecast for FY2018 Theme for FY2018: Challenge Take on the challenge of maximizing the value we provide seriously Take on the challenge of increasing the level of customer satisfaction without compromise Results in FY2017 Forecast for FY2018 Net Sales 21,574 25,000 Operating profit 1,214 1,350 Ordinary profit 1,225 1,350 Profit attributable to owners of parent Sales growth YoY (Million yen) +3,425 (116%) +135 (111%) +124 (110%) +142 (120%) Dividends per share

28 Medium- to Long-Term Vision of GDO from 2020 Mission of GDO 28

29 Shareholder Returns 29

30 Dividend Policy Basic policy for distribution of profits Proactively return profits to shareholders while giving consideration to a balance between business performance and internal reserves. Dividends Dividends paid in FY per share(dividends ratio 23.2%) (Interim dividend 4.0, Year-end dividend 5.0) Dividends expected in FY per share(dividends ratio 20.4%) (Interim dividend 4.0, Year-end dividend 5.5) 30

31 Financial Information 31

32 Financial Highlights: Consolidated Net Sales (Million yen) YoY 114% YoY 113% YoY 107% YoY 112% 32

33 Financial Highlights: Consolidated Gross Profit (Million yen) 33

34 Financial Highlights: Selling, General and Administrative Expenses (Million yen) 34

35 Financial Highlights: Consolidated Operating Profit (Million yen) 35

36 Financial Highlights: Consolidated Ordinary Profit (Million yen) 36

37 Financial Highlights: Profit Attributable to Owners of Parent (Million yen) 37

38 Financial Highlights: Net Income Per Share (Yen) *GDO conducted a 100-for-one stock split on July 1, 2013, and net income per share or net loss per share is calculated on the assumption that the stock split was conducted at the beginning of

39