Kusuri No Aoki Holdings (3549) Q4 2024 earnings summary

Executive summary

• Revenue rose 15.3% year-over-year to ¥436,875 million, with operating profit up 21.4% to ¥18,569 million and recurring profit up 5.1% to ¥20,101 million.

• Net income attributable to shareholders was ¥12,307 million, a slight decrease of 0.2% year-over-year, impacted by a one-time stock compensation expense of ¥6,810 million.

• Excluding stock compensation, adjusted operating profit was ¥25,379 million (+65.9%), recurring profit ¥26,911 million (+40.7%), and net income ¥19,117 million (+55.1%).

• Store network expanded to 953 locations, including 936 drugstores (594 with pharmacies), 6 pharmacy-only stores, and 11 supermarkets.

• Product sales growth was led by food (+24.5%), life (+10.1%), beauty (+8.7%), and health (+2.7%) segments.

Financial highlights

• Gross margin was 27.0% (¥118,090 million gross profit on ¥436,875 million sales).

• Operating margin improved to 4.3%, recurring margin to 4.6%, and net margin to 2.8%.

• Total assets increased to ¥303,453 million (+¥29,152 million YoY), with equity at ¥117,420 million and equity ratio at 36.4%.

• Cash and equivalents at year-end were ¥48,974 million, up from ¥42,870 million.

• Operating cash flow was ¥26,864 million, investment cash flow was -¥21,104 million, and financing cash flow was ¥344 million.

Outlook and guidance

• FY2025 guidance: revenue ¥485,000 million (+11.0%), operating profit ¥25,107 million (+35.2%), recurring profit ¥25,607 million (+27.4%), net income ¥18,107 million (+47.1%).

• Adjusted for stock compensation, FY2025 net income is forecast at ¥18,500 million (-3.2% YoY).

• Plans for 70 new drugstore openings and 70 new pharmacy openings, with continued focus on food and pharmacy integration.