Consolidated results for the third Quarter Period in FY2014

Transcription

1 Consolidated results for the third Quarter Period in FY /2/7 Company Name Watami Co., Ltd. Listing: First Section of Tokyo Stock Exchange Code Number 7522 URL Representative Managing Director Yutaka Kuwabara Phone: Contact General Manager of Management Planning Division Takeshi Oda (Figures less than one million yen are rounded) 1. Consolidated results for the third quarterly period in FY2014 (2013/4/1-2013/12/31) (1)Consolidated operating results Sales Operating income Ordinary income Net profit in the period Million yen % Million yen % Million yen % Million yen % The 3rd Quarterly in , , , The 3rd Quarterly in , , , , (Reference) Comprehensive income The 3rd Quarterly in 2014: 1,227 million yen ( 53.6%), The 3rd Quarterly in 2013: 2,647 million yen (0.3%) The 3rd Quarterly in 2014 The 3rd Quarterly in 2013 Net profit per stock in the period Net profit per stock after residual security control Yen Yen Yen Yen (2)Consolidated financial status Net assets FY 2013 Million yen 130, ,680 Million yen 32,576 32,046 % Yen (Reference) Shareholders' equity The 3rd Quarterly in 2014: 32,198 million yen, FY2013: 31,688 million yen The 3rd Quarterly in 2014 Gross assets Capital adequacy ratio Capital adequacy ratio 2. Dividend status (Base date) 3rd quarter 3rd quarter Dividend per share(yen) 3rd quarter Year end Total annual FY 2013 The 3rd Quarterly in 2014 FY 2014 (Estimation) Prospect of consolidated achievement for FY 2014 (2013/4/1 2014/3/31) (Percentages represent changes compared with the previous year.) Net profit per Sales Operating income Ordinary income Net profit in the period stock in the period Million yen % Million yen % Million yen % Million yen % Yen FY , , , ,

2 1. Qualitative information relating to the quarterly results (1) Description of operating results Japan s economy seemed to recover, particularly in export-related companies, during the first three quarters of the consolidated fiscal year under review. This was due to the ongoing weak yen trend and high stock prices brought about by the government s monetary easing measures and other economic policies. Most of us, however, are still unable to feel the effects of the economic recovery because the future of overseas economic situations is uncertain, with economic malaise in developing companies, and the downturn of domestic economy is a concern as a result of the increased cost of raw materials, due to the weakening yen. Extremely severe situations have continued in our group in terms of management, with levels of consumer spending barely recovering. Within such an environment, we have expanded our activities in various business segments in order to earn the appreciation of customers, based on the Watami Group slogan, "To collect the most 'Thank You' on the planet." The results of each business segment are as follows. 1 Domestic Restaurant Business In our domestic restaurant business, we opened 16 new restaurants. On the other hand, we closed 13 restaurants, so the number of restaurants as of the end of this consolidated third quarter stands at 643. Continuing since the previous fiscal year, in an attempt to maintain the competitive edge of our restaurants, we renovated 28 restaurants, the majority of which are ZaWatami and Watamin-chi restaurants. However, due to the ongoing severe business environment, consolidated net sales for existing restaurants for this period is 93.8% year on year. As a result, net sales for the domestic restaurant business were 52,948 million yen (95.3% compared with the same period of the previous year) and segment losses were 76 million yen (profits of 2,480 million yen for the same period of the previous year).

3 2 Caregiving Business In our caregiving business, 9 facilities were newly opened and the total number of residents in all facilities exceeded 6,200. We have a total of 101 facilities at the end of this consolidated third quarter. Moreover, giving first priority to the residents satisfaction, we are constantly trying to improve our caregiving service by upgrading meals, making efforts for four major zeros (zero diapers, zero tube feeding, zero special baths and zero wheelchairs) and enhancing various activities with the goal of reinforcing the Watami brand. However, it remained new resident number falls below expectations, regarding the occupancy rate for existing facilities was 85.4% at the end of this consolidated third quarter. Net sales for the caregiving business were 26,404 million yen (105.7% compared with the same period of the previous year) and segment profits were 3,027 million yen (79.3% compared with the same period of the previous year). 3 Home-Meals Business In our home-meals business, 96 sales outlets were newly opened, so the number of our sales outlets as of the end of this consolidated third quarter stands at 527. In an elderly person food delivery to home market, it becomes sales share No.1 and has a large number of customers support it. However, as a great number of competitors have joined the home-meals market, we are forced to fiercely compete for customers. The number of cooked meals delivered per weekday as of the last week of December was 271,000, an increase of only 18,000 compared with the same period of the previous year. Net sales for the home-meals business came in at 32,914 million yen (113.7% compared with the same period of the previous year) and segment profits were 2,765 million yen (127.0% compared with the same period of the previous year). 4 Other Businesses (including overseas restaurant, agricultural and environmental businesses) In our overseas restaurant business, we opened 15 new restaurants. On the other hand, we closed 2 restaurants, so the number of restaurants as of the end of this consolidated third quarter stands at 94. We will continue to make efforts to expand our restaurant development, including franchising, and to establish new business models such as Watei and Kitchen J.

4 In our agricultural business, we are continuously making efforts to increase the added values of agricultural products by developing menus, as well as through incorporation of the manufacturing and processing sections for streamlining. In our environmental business, we are trying to further strengthen our efforts for reduction of environmental loads through our environmental improvement business, including garbage composting and other recycling services, and our renewable energy business based on wind-power generation. Net sales for other businesses (including the overseas restaurant, agricultural and environmental businesses) were 10,880 million yen (144.7% compared with the same period of the previous year) and segment profits were 250 million yen (112.1% compared with the same period of the previous year). As a result of the above measures, the consolidated net sales of the corporate group for the first three quarters of the consolidated fiscal year were 123,147 million yen (an increase of 5.2% compared to the same period last year), the operating income was 4,085 million yen (a decrease of 40.3% compared to the same period last year), the ordinary income was 3,511 million yen (a decrease of 40.6% compared to the same period last year) and the net income was 957 million yen (a decrease of 63.9% compared to the same period last year). (2) Description of financial positions The total assets as of the end of this consolidated third quarter were 130,197 million yen, an increase of 5,517 million yen from the end of the previous consolidated fiscal year (hereinafter referred to as the end of the previous year ). The current assets were 18,415 million yen (decreased by 915 million yen from the end of the previous year) and the fixed assets were 111,781 million yen (increased by 6,433 million yen from the end of the previous year). Of all the fixed assets, the tangible fixed assets were 74,017 million yen (increased by 5,082 million yen from the end of the previous year), primarily due to the addition of lease assets in connection with establishment of new caregiving facilities and the purchase of fixtures for restaurants. The intangible fixed assets were 8,044 million yen (decreased by 77 million yen from the end of the previous year), due to amortization of goodwill and other factors. Investments and other assets were 29,719 million yen (increased by 1,428 million yen from the end of the previous year) mainly due to the increase of security deposits offered in connection with establishment of new caregiving facilities and opened new restaurants.

5 The total liabilities as of the end of this consolidated third quarter were 97,620 million yen, an increase of 4,986 million yen from the end of the previous year. The current liabilities were 30,144 million yen (decreased by 2,831 million yen from the end of the previous year), primarily due to a decrease of short-term loans payable and a decrease notes and accounts payable, and the fixed liabilities were 67,476 million yen (increased by 7,817 million yen from the end of the previous year), mainly due to an increase in long-term loans payable and an increase Long-term lease deposited. Of all the liabilities, the interest-bearing liabilities (the sum of the current portion of bonds, short-term loans payable, long-term loans payable and lease obligations) were 64,909 million yen (increased by 8,024 million yen from the end of the previous year). Net assets as of the end of this consolidated third quarter were 32,576 million yen, an increase of 530 million yen from the end of the previous year, primarily due to an increase in retained earnings. (3) Description of future prediction information, including the consolidated performance forecast We have not modified our consolidated performance forecast announced in the Notice of Adjustment of Our Performance Forecast on October 25, 2013.

6 2. (Summary) The 3rd Quarterly FY2014 (1) (Summary) The 3rd Quarterly FY2014 Balance Sheet (Millions of Yen) FY2013 The 3rd Quarterly in 2014 (Assets) Current assets Cash and deposits 9,004 8,584 Accounts receivable 4,193 4,347 Merchandise and Finished goods Material in process Raw materials Other 5,023 4,267 Allowance for doubtful accounts 7 11 Total current assets 19,331 18,415 Noncurrent assets Property, plant and equipment Buildings and accompanying facilities 20,394 20,869 Lease assets 45,540 49,429 Other 3,000 3,718 Total property, plant and equipment 68,935 74,017 Intangible assets Good will 7,226 6,754 Other 895 1,289 Total intangible assets 8,121 8,044 Investment and other assets Guarantee deposits Other Allowance for doubtful accounts Total Investment and other assets Total noncurrent assets Total assets 22,303 22,738 6,191 7, ,291 29, , , , ,197

7 (Millions of Yen) FY2013 The 3rd Quarterly in 2014 (Liabilities) Current Liabilities Notes and accounts payable 4,633 4,469 Short-term loans payable 6,550 6,122 Lease obligations 3,670 3,984 Income taxes payable 1, Provision for bonuses Provision for sales promotion expenses Provision for cancellation of short term facility lease contract Other Total current liabilities 15,609 14,516 32,975 30,144 Noncurrent liabilities Long-term loans payable 2,867 7,090 Lease obligations 43,596 47,710 Long-term lease deposited 9,382 8,367 Asset retirement obligations 2,052 2,153 Other 1,759 2,153 Total noncurrent liabilities 59,658 67,476 Total liabilities (Net assets) Shareholders' equity Capital stock Capital surplus Retained earnings Treasury stock Total shareholder's equity Valuation and translation adjustments Valuation difference on availablefor-sale securities Foreign currency translation adjustment Total Valuation and translation adjustments Subscription rights to shares Total Net assets Total Liabilities and net assets 92,634 97,620 4,410 4,410 5,002 5,002 25,211 25,556 2,848 2,953 31,775 32, ,046 32, , ,197

8 (2)(Summary) The 3rd quarterly in FY2014 Profit and Loss Statements (Millions of Yen) The 3rd Quarterly in 2013 The 3rd Quarterly in 2014 Net sales Cost of sales Gross profit Selling, general and 116, ,147 52,632 57,843 64,364 65,304 administrative expenses 57,512 61,218 Operating income 6,851 4,085 Non-operating income Interest income Rent income on facilities Subsidy income Miscellaneous income Non-operating expenses Interest expenses 1,428 1,557 Rent expenses on facilities Equity in loss of affiliates - 69 Miscellaneous loss Ordinary income Extraordinary loss Loss on retirement of noncurrent assets Loss from termination on leasing contracts Loss on cancellation of leasehold contracts Impairment loss Income before income taxes Income taxes Income taxes-deferred Net income 5,916 3, ,887 2,760 1,957 1, ,

9 (3)(Summary) The 3rd quarterly in FY2014 Consolidated Cash Flow Statements (Millions of Yen) The 3rd Quarterly in 2013 The 3rd Quarterly in 2014 Net cash provided by (used in) operating activities Income before income taxes 4,887 2,760 Depreciation and amortization 5,458 6,654 Impairment loss Amortization of goodwill Increase (decrease) in provision for bonuses Increase (decrease) in provision for sales promotion expenses Interest and dividends income Interest expenses 1,428 1,557 Loss on retirement of noncurrent assets Loss from termination on leasing contracts 23 7 Loss on cancellation of leasehold contracts 35 - Decrease (increase) in notes and accounts receivable Decrease (increase) in inventories Decrease (increase) in other accounts receivable Increase of purchase liabilities Increase (decrease) in accounts payable Increase (decrease) in accrued expenses Increase (decrease) in accrued consumption tax Increase (decrease) in guarantee deposits of the care received 1, Other Subtotal 15,992 10,847 Interest and dividends income received Interest expenses paid 1,422 1,556 Income taxes paid 3,532 3,312 Refund of Income taxes 574 1,187 Net cash provided by (used in) operating activities 11,624 7,177 Net cash provided by (used in) investing activities Purchase of property, plant and equipment 5,820 4,536 Payments for guarantee deposits 1,545 1,337 Proceeds from collection of guarantee deposits Payments of loans receivable Collection of loans receivable 7 7 Proceeds from time deposits Payments for trust deposits 1, Proceeds from trust deposits Other Net cash provided by (used in) investing activities 8,147 6,284

10 (Millions of Yen) The 3rd Quarterly in 2013 The 3rd Quarterly in 2014 Net cash provided by (used in) financing activities Increase in short-term loans payable 3,227 7,121 Decrease in short-term loans payable 713 6,300 Proceeds from long-term loans payable 457 6,366 Repayment of long-term loans payable 3,726 3,556 Redemption of bonds Proceeds from disposal of treasury stock Purchase of treasury stock Repayments of finance lease obligations 2,334 3,031 Cash dividends paid Cash flow from financial activities 4, Effect of exchange rate change on cash and cash equivalents Net increase (decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of period 10,306 9,004 Increase (Decrease) in cash and cash equivalents upon change of fiscal term of consolidated subsidiary Cash and cash equivalents at the end of period 9,716 8,584

11 (4) Notes to ongoing concern assumption Not applicable (5)Business Segment Information Operating Segments The 3rd Quarterly in 2013 (Millions of Yen) Restaurant business Nursing care business Food Catering Business for Elderly People Subtotal Other Subtotal Corporate & elimination Total Net sales: Customers 55,559 24,978 28, ,482 7, , ,996 intersegment 1, ,571 2,378 3,949 3,949 - Total 57,130 24,978 28, ,053 9, ,945 3, ,996 Segment profit 2,480 3,816 2,177 8, ,697 1,846 6,851 (Note) 1. "Other" include business segments that are not classified in the reported segments, such as overseas restaurant business, agriculture business, and environmental improvement and maintenance business. 2. Amounts in the column "Corporate & elimination" of (\1,846) million represents (\503) million of goodwill amortization and (\1,356) million yen of corporate expenses that were not allocated to the reported segments. Corporate expenses are mainly associated with Group wide administrative activities. 3. Segment profits or losses are adjusted with the operating profit in the quarterly consolidated financial statement. The 3rd Quarterly in 2014 (Millions of Yen) Restaurant business Nursing care business Food Catering Business for Elderly People Subtotal Other Subtotal Corporate & elimination Total Net sales: Customers 52,948 26,404 32, ,267 10, , ,147 intersegment 1, ,770 1,443 3,213 3,213 - Total 54,718 26,404 32, ,037 12, ,361 3, ,147 Segment profit or loss 76 3,027 2,765 5, ,967 1,881 4,085 (Note) 1. "Other" include business segments that are not classified in the reported segments, such as overseas restaurant business, agriculture business, and environmental improvement business. 2. Amounts in the column "Corporate & elimination" of (\1,881) million represents (\471) million of goodwill amortization and (\1,393) million yen of corporate expenses that were not allocated to the reported segments. Corporate expenses are mainly associated with Group wide administrative activities. 3. Segment profits is adjusted with the operating profit in the quarterly consolidated financial statement.