Gift Holdings (9279) Q1 2025 earnings summary

Executive summary

• Net sales for the three months ended January 31, 2025, rose 24.9% year-over-year to 8,504 million yen, driven by aggressive new store openings and stable customer numbers.

• Operating profit declined 14.7% year-over-year to 774 million yen due to higher costs in raw materials, labor, and investments.

• Store network expanded by 21 stores during the quarter, reaching 831 total stores, with growth in both company-owned and produced/franchise stores domestically and internationally.

• Recruitment and retention improved, with a lower retirement rate (11.9%) and substantial wage increases implemented.

• The business environment was marked by import-driven inflation, yen depreciation, and rising labor costs, but inbound tourism and consumer spending remained strong.

Financial highlights

• Gross profit increased to 5,643 million yen, with a gross margin of 66.4%, but selling, general, and administrative expenses rose to 4,868 million yen.

• Operating profit margin was 9.1%, below the annual target of 10.0%.

• Quarterly profit attributable to owners of parent fell 11.8% year-over-year to 547 million yen.

• Basic earnings per share were 27.40 yen, down from 31.12 yen in the prior year period.

• Total assets grew to 18,445 million yen, up 1,345 million yen from the previous fiscal year-end.

Outlook and guidance

• Full-year forecast for FYE October 31, 2025, remains unchanged: net sales of 36,000 million yen (+26.4%), operating profit of 3,600 million yen (+23.7%), and profit attributable to owners of parent of 2,200 million yen (+17.3%).

• Store opening plan targets a net increase of 103 stores (51 company-owned, 52 produced/franchise) to reach 913 stores by year-end.

• Dividend forecast for FYE October 2025 is 22.0 yen per share, aiming for a payout ratio of 20% or more.

• No changes were made to previously announced earnings forecasts.