ONWARD Holdings (8016) Q3 2024 earnings summary

Executive summary

• 9M FY2024 net sales rose 8.4% to ¥141,383m; operating profit increased 124.8% to ¥9,700m and parent-attributable profit rose 111.0% to ¥5,746m.

• Mainstay-brand sales, OMO store improvements and supply-chain streamlining supported growth and higher operating margins.

Financial highlights

• Gross profit was ¥80,274m versus ¥72,625m; SG&A was ¥70,573m versus ¥68,309m, rising more slowly than sales.

• Recurring profit increased 92.7% to ¥9,055m; EBITDA rose 61.1% to ¥13,282m.

• Nine-month gross margin was 56.8%, up 1.1 percentage points; operating margin was 6.9%, up 3.6 points.

• Comprehensive income was ¥4,662m versus ¥9,849m, reflecting other comprehensive income of -¥1,289m versus ¥7,197m.

Outlook and guidance

• FY2024 forecast: sales ¥189,211m, operating profit ¥11,022m and recurring profit ¥10,012m; forecasts were unchanged from the prior outlook.

• Parent-attributable profit forecast rose ¥449m, or 8.2%, to ¥5,911m, as stronger expected taxable income supports deferred tax asset recognition and lower tax expense.

• FY2024 EBITDA forecast was ¥16,100m, up 55.2%; basic EPS forecast was ¥43.55 versus ¥40.25 previously.

• Full-year dividend forecast increased to ¥18 per share from ¥17; the prior fiscal-year dividend was ¥12 per share.