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During the nine months ended December 31, 2023, the Japanese economy proceeded with the normalization of
economic activities, backed by the lifting of restrictions on activities following the reclassification
of COVID-19’s category to Class 5 under the Act on the Prevention of Infectious Diseases and Medical
Care for Patients with Infectious Diseases. Yet, the future outlook remains uncertain due to concerns
that would depress consumer sentiment, such as rising energy costs and raw materials prices, foreign
exchange rate fluctuations, and rising prices resulting from the foregoing factors.
In the auto parts and accessories industry, in which the Company operates, there was a recovery in
demand for driving, including travel and homecoming visits, leading to steady sales of expendable auto
parts such as tires, oil, and batteries. However, sales of winter season products such as studless tires
were sluggish due to a warm winter throughout Japan.
In this environment, the Group proceeded with the expansion of sales of tires and other expendable auto
parts, which is one of our management strategies, and the enhancement of installation/maintenance
services and maintenance service options. In addition, as a new initiative, the Group started handling
the Rakuten Point Card in September 2023, aiming to improve customer convenience and satisfaction, and
acquire new customers.
In terms of store development, the Group worked to improve the efficiency of management resources,
including relocating stores to sites with favorable conditions, amalgamating stores to improve profits,
and changing business types within the Group.
During the nine months ended December 31, 2023, net sales amounted to 113,554 million yen (100.7%
year-on-year, or up 737 million yen), and gross profit was 48,436 million yen (100.4% year-on-year, or
up 178 million yen), only slightly higher than the previous corresponding period. This was due to steady
sales of expendable auto parts such as tires, oil, and batteries, and an increase in wage earnings
associated with vehicle inspection, while demand related to motorcycles, which had been strong during
the COVID-19 pandemic, declined, resulting in sluggish sales of motorcycle parts, and a warm winter led
to sluggish sales of winter season products.
Selling, general and administrative expenses exceeded the previous corresponding period, amounting to
36,470 million yen (103.1% year-on-year, or up 1,113 million yen), primarily owing to an increase in
depreciation associated with capital investment, such as for new store openings, and an increase in
store operations costs, such as personnel costs.
As a result, operating profit was 11,966 million yen (92.8% year-on-year, or down 935 million yen),
ordinary profit was 13,190 million yen (96.1% year-on-year, or down 529 million yen), and profit
attributable to owners of parent was 8,976 million yen (96.4% year-on-year, or down 339 million
yen).
Movement restrictions have been lifted, and economic activities are returning to normal. The future
outlook, however, remains uncertain due to factors such as rising prices caused by increases in the
prices of energy and raw materials and foreign exchange rate fluctuations. Nevertheless, given these
circumstances, the Group will continue to facilitate further reinforcement of its business foundations
to increase earnings by stepping up efforts, including the expansion of the automotive parts sales
business, which is the main source of the Group’s earnings.
We look forward to your continued warm support and guidance.
February 2024
Message from the President
Yasuo Horie
Representative Director
During the nine months ended December 31, 2023, the Japanese economy proceeded with the normalization
of
economic activities, backed by the lifting of restrictions on activities following the
reclassification
of COVID-19’s category to Class 5 under the Act on the Prevention of Infectious Diseases and Medical
Care for Patients with Infectious Diseases. Yet, the future outlook remains uncertain due to concerns
that would depress consumer sentiment, such as rising energy costs and raw materials prices, foreign
exchange rate fluctuations, and rising prices resulting from the foregoing factors.
In the auto parts and accessories industry, in which the Company operates, there was a recovery in
demand for driving, including travel and homecoming visits, leading to steady sales of expendable auto
parts such as tires, oil, and batteries. However, sales of winter season products such as studless
tires
were sluggish due to a warm winter throughout Japan.
In this environment, the Group proceeded with the expansion of sales of tires and other expendable
auto
parts, which is one of our management strategies, and the enhancement of installation/maintenance
services and maintenance service options. In addition, as a new initiative, the Group started handling
the Rakuten Point Card in September 2023, aiming to improve customer convenience and satisfaction, and
acquire new customers.
In terms of store development, the Group worked to improve the efficiency of management resources,
including relocating stores to sites with favorable conditions, amalgamating stores to improve
profits,
and changing business types within the Group.
During the nine months ended December 31, 2023, net sales amounted to 113,554 million yen (100.7%
year-on-year, or up 737 million yen), and gross profit was 48,436 million yen (100.4% year-on-year, or
up 178 million yen), only slightly higher than the previous corresponding period. This was due to
steady
sales of expendable auto parts such as tires, oil, and batteries, and an increase in wage earnings
associated with vehicle inspection, while demand related to motorcycles, which had been strong during
the COVID-19 pandemic, declined, resulting in sluggish sales of motorcycle parts, and a warm winter
led
to sluggish sales of winter season products.
Selling, general and administrative expenses exceeded the previous corresponding period, amounting to
36,470 million yen (103.1% year-on-year, or up 1,113 million yen), primarily owing to an increase in
depreciation associated with capital investment, such as for new store openings, and an increase in
store operations costs, such as personnel costs.
As a result, operating profit was 11,966 million yen (92.8% year-on-year, or down 935 million yen),
ordinary profit was 13,190 million yen (96.1% year-on-year, or down 529 million yen), and profit
attributable to owners of parent was 8,976 million yen (96.4% year-on-year, or down 339 million
yen).
Movement restrictions have been lifted, and economic activities are returning to normal. The future
outlook, however, remains uncertain due to factors such as rising prices caused by increases in the
prices of energy and raw materials and foreign exchange rate fluctuations. Nevertheless, given these
circumstances, the Group will continue to facilitate further reinforcement of its business foundations
to increase earnings by stepping up efforts, including the expansion of the automotive parts sales
business, which is the main source of the Group’s earnings.
We look forward to your continued warm support and guidance.
February 2024