Earning Presentation
for Six months ended September 30, 2023
November 13, 2023
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Financial Results for 2Q of FY 2023
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My name is Toshiyuki Furukawa, in charge of the Public & Investor Relations Department. I will provide an explanation on the financial results for the second quarter of fiscal 2023.
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Financial Results for 1H (Apr-Sep) of FY 2023
FY2022 | FY2023 | |
1H(Apr.-Sep.) | 1H(Apr.-Sep.) | |
(Unit︓billion yen) | Result | Result |
Net sales | 147.6 | 152.9 |
Operating profit | 12.3 | 13.5 |
Operating margin | 8.4% | 8.9% |
Ordinary Profit | 16.8 | 17.4 |
Profit attributable to | 12.6 | 13.3 |
owners of parent | ||
Exchange rate | ¥131/USD | ¥139/USD |
¥138/EUR | ¥152/EUR | |
YoY Change
Amount %
- 5.2 + 3.5%
- 1.1 + 9.6%
- -
- 0.6 + 3.7%
- 0.7 + 5.9%
| Net sales | Sales increased, reflecting continuing growth in the mainstay |
Watches segment | ||
| Operating | Profit increased, mainly driven by the Watches segment |
profit | 3 | |
This is the outline of the statement of income for the first half.
Net sales increased 3.5% to JPY 152.9 billion, reflecting strong performance mainly in the Watches segment.
Operating profit rose 9.6% to JPY 13.5 billion due partly to the effects of a weak yen. The operating profit margin stood at 8.9%.
Ordinary profit and profit attributable to owners of parent climbed 3.7% and 5.9% respectively, to JPY 17.4 billion and JPY 13.3 billion.
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Result by Business Segments for 1H (Apr-Sep) of FY 2023
FY2022 | FY2023 | |||||||
Net sales | 1H(Apr.-Sep.) | 1H(Apr.-Sep.) | YoY Change | |||||
(Unit︓billion yen) | Result | Result | Amount | % | ||||
Watches | 73.3 | 78.5 | + 5.1 | + 7.0% | ||||
Machine Tools | 40.9 | 41.4 | + 0.5 | + 1.3% | ||||
Devices and Components | 22.9 | 22.1 | ( 0.7 ) | ( 3.2% ) | ||||
Electronic and Other Products | 10.4 | 10.7 | + 0.3 | + 3.0% | ||||
Consolidated Total | 147.6 | 152.9 | + 5.2 | + 3.5% | ||||
Operating Profit | ||||||||
(Unit: billion yen, %:operating margin) | ||||||||
Watches | 8.8 | 10.2 | + 1.3 | + 15.9% | ||||
12.0% | 13.0% | |||||||
Machine Tools | 5.5 | 5.2 | ( 0.3 ) | ( 5.5% ) | ||||
13.5% | 12.6% | |||||||
Devices and Components | 0.0 | 0.4 | + 0.3 | + 1,708.2% | ||||
0.1% | 1.8% | |||||||
Electronic and Other Products | 0.7 | 0.6 | ( 0.0 ) | ( 9.3% ) | ||||
7.1% | 6.3% | |||||||
Eliminations or general corporate | ( 2.7 ) | ( 2.9 ) | ( 0.2 ) | - | ||||
Consolidated Total | 12.3 | 13.5 | + 1.1 | + 9.6% | ||||
8.4% | 8.9% | 4 | ||||||
This list shows financial results by business segment.
The Watches segment continued to perform strongly, achieving an 7.0% year-on-year increase in net sales and an 15.9% year-on-year increase in operating profit, or the operating margin of 13.0%.
The Machine Tools segment posted a 1.3% increase in net sales, but posted a 5.5% decrease in operating profit largely due to the impact of the higher cost of purchased materials.
Devices and Components segment recorded a dip in net sales, but profit rose slightly. Electronics and Other Products segment posted an increase in net sales.
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Financial Results for 2Q (Jul-Sep) of FY 2023
FY2022 | |
2Q(Jul.-Sep.) | |
(Unit︓billion yen) | Result |
Net sales | 76.3 |
Operating profit | 6.7 |
Operating margin | 8.9% |
Ordinary Profit | 8.2 |
Profit attributable to |
owners of parent | 5.3 |
Exchange rate | ¥137/USD |
¥140/EUR | |
FY2023
2Q(Jul.-Sep.)
Result
80.2
8.0
10.0%
9.4
7.1
¥144/USD ¥157/EUR
YoY Change
Amount %
- 3.8 + 5.1%
- 1.2 + 18.3%
- -
- 1.1 + 14.2%
- 1.7 + 32.0%
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Next, I will describe the consolidated financial results for the second quarter.
Net sales increased 5.1% to JPY 80.2 billion. Operating profit climbed 18.3% to JPY 8.0 billion, with an operating margin of 10.0%.
Ordinary profit and profit attributable to owners of parent rose 14.2% and 32.0%, respectively, to JPY 9.4 billion and JPY 7.1 billion.
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Result by Business Segments for 2Q (Jul-Sep) of FY 2023
FY2022 | FY2023 | |||||||
Net sales | 2Q(Jul.-Sep.) | 2Q(Jul.-Sep.) | YoY Change | |||||
(Unit︓billion yen) | Result | Result | Amount | % | ||||
Watches | 38.2 | 41.4 | + 3.1 | + 8.4% | ||||
Machine Tools | 20.9 | 21.9 | + 0.9 | + 4.6% | ||||
Devices and Components | 11.9 | 11.3 | ( 0.6 ) | ( 5.2% ) | ||||
Electronic and Other Products | 5.2 | 5.5 | + 0.3 | + 6.6% | ||||
Consolidated Total | 76.3 | 80.2 | + 3.8 | + 5.1% | ||||
Operating Profit | ||||||||
(Unit: billion yen, %:operating margin) | ||||||||
Watches | 4.8 | 5.6 | + 0.8 | + 16.8% | ||||
12.7% | 13.7% | |||||||
Machine Tools | 2.8 | 2.8 | + 0.0 | + 2.0% | ||||
13.5% | 13.1% | |||||||
Devices and Components | 0.0 | 0.3 | + 0.2 | + 385.6% | ||||
0.6% | 3.1% | |||||||
Electronic and Other Products | 0.3 | 0.5 | + 0.1 | + 32.4% | ||||
7.6% | 9.4% | |||||||
Eliminations or general corporate | ( 1.3 ) | ( 1.4 ) | + 0.0 | - | ||||
Consolidated Total | 6.7 | 8.0 | ( 1.2 ) | + 18.3% | ||||
8.9% | 10.0% | 6 | ||||||
Results by business segment for the second quarter are shown here.
All segments achieved growth in net sales and in operating income.
I will provide an overview of each business in the next slide.
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Watches (Operating Performance)
2Q (Jul-Sep)
| Finished watch | A trend toward recovery was seen in the domestic market. Additionally, sales increased as the |
sales | European market remained brisk. | |
| Movement sales | Sales increased due to solid sales of mechanical movements despite sluggish growth of analog |
quartz movements | ||
Net sales (billion yen) | Operating profit (billion yen) | |
■ FY2022 ■ FY2023 | ■ FY2022 ■ FY2023 |
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Slide 8>7 shows the results for the Watches segment.
In finished watches sales, the domestic market trended toward recovery and the European market continued to perform strongly. As a result, net sales increased.
In sales of movements, analog quartz movements did not grow as expected. Even so, net sales increased because mechanical movements remained firm.
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Watches Net sales growth rate by region
* The rate of change in total sales of CITIZEN brand watches and BULOVA | |
Rate of change year on year | |
brand watches only for North America. For other regions, the rate of change | |
only in sales of CITIZEN brand watches. | |
* Rate of change based on local currency |
Sales remained at the year-ago level in Japan and
Asia (except China).
The strong performances of North America and Europe contributed to a rise in overall sales, offsetting a significant decline in China.
| Japan | Attesa and Promaster led the overall business. In addition, inbound demand continued to recover. |
| China | Consumer confidence continued to be weak. |
| Asia (except China) | Inbound demand was firm in Singapore, among other countries, but sales in Hong Kong were sluggish. |
| America | The attitude of jewelry chains, department stores and others was clearly cautious, but e-commerce |
performed strongly. | ||
| Europe | Italy maintained their strong performance, and the number of new dealers rose in France. |
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Next, I would like to talk about year-on-year changes in net sales by region on a local currency basis.
The chart on the left shows year-on-year changes for the second quarter alone.
The red bar shows Japan, where net sales increased because core brands such as ATTESA led the overall business and inbound demand continued to trend toward recovery.
Light yellow is China, where net sales decreased slightly due to continued weak consumer confidence.
In Asia, shown in light green, net sales fell due to weak performance in Hong Kong in particular, despite strong inbound demand in Singapore, among other countries.
In North America, the region indicated by the light blue bar, jewelry chains, department stores and others showed a cautious attitude toward purchases. Still, net sales increased due to strong e-commerce sales.
Europe, indicated by the light purple bar, recorded an increase in net sales due to a continued rise in sales in France, coupled with the strong performance maintained in Italy, among other countries.
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Watches: Premium brands
Launched a limited-edition model watch with a washi (traditional Japanese paper) face featuring platinum leaves falling like snow.
- Incorporates highly accurate solar power-basedeco-drive movements that have a variation of +/- 5 seconds per year.
- The model with a Tosa washi face decorated with platinum leaves will be sold in limited quantities.
Release date: November 2023 | |
Recommended retail price: 451,000 yen (tax included) | |
Quantity: 500 units worldwide | 9 |
Next, I would like to introduce our new premium brand products.
We launched a new model in The CITIZEN line this month. The model, which will be sold in limited quantities, is equipped with a highly accurate solar power-basedeco-drive movement, which has a variation of +/- 5 seconds per year, and a new platinum leaf- decorated version of the well-receivedTosa-Washipaper-inspired face.
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Watches: Enhancement of global model collections
The TSUYOSA collection gaining popularity for its rich color options.
- A popular model known overseas for its TSUYOSA Collection nickname.
- Mechanical watches whose neat design appeals thanks to their vividly colored faces featuring combination with simple and basic hands.
Recommended retail price: 63,800 yen - 66,000 yen (tax included)
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This slide shows a group of mechanical watches nicknamed the TSUYOSA Collection. They are hero products that have achieved the largest sales quantities among the CITIZEN-branded global models this year.
These watches were initially sold under the TSUYOSA nickname in France and gained popularity quickly in Europe. Subsequently, we launched them in North America and started to sell them in Japan as well in September.
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Citizen Watch Co. Ltd. published this content on 20 November 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 November 2023 02:53:08 UTC.