In today’s briefing:
- Tokyo Gas (9531 JP) Mega Buyback Announced
- Skylark Holdings: A Big Upgrade to Guidance Could Be on The Horizon
- Isetan-Mitsukoshi: ¥300 Billion from Just One Store
- SoftBank Group (9884 JP) – Revolut’s Impending Valuation Write-Down?
- CyberAgent: Growth Avenues Seem Limited and Further Downside to Consensus
Tokyo Gas (9531 JP) Mega Buyback Announced
- Five days ago, Tokyo Gas (9531 JP) announced a revision to earnings for the year to 31 March 2023. Today they reported results, and announced March 2024 guidance.
- The company also announced a buyback programme to spend up to ¥113 billion to repurchase up to 53mm shares (12.2% of TSO). ¥113 billion is a very specific number.
- With the price where it is, ¥113bn is “only” 9.6% of shares out but this is very interesting indeed.
Skylark Holdings: A Big Upgrade to Guidance Could Be on The Horizon
- The removal of COVID-19 testing requirements for Chinese tourists is expected to increase tourist arrivals from the Greater China region.
- In addition, consensus estimates for Skylark Co Ltd (3197 JP) are increasing due to the company’s faster-than-expected same-store sales recovery.
- Skylark’s annual operating profit could reach ¥20bn if revenues return to pre-COVID levels, which is significantly higher than consensus of ¥5.2bn and guidance of ¥6.0bn.
Isetan-Mitsukoshi: ¥300 Billion from Just One Store
- Isetan Shinjuku has always outperformed competitors by a large distance but the store’s management is intent on widening this gap further.
- The key will be a focus on premium customers with ever more granular data sets to personalise marketing. 68% of sales now come from cardholders, compared to 50% in 2018.
- While dependence on just a few stores makes Isetan Mitsukoshi Holdings Ltd (3099 JP) vulnerable to downturns – such as the loss of tourist traffic – these stores are also resilient.
SoftBank Group (9884 JP) – Revolut’s Impending Valuation Write-Down?
- We have already questioned SoftBank’s private company valuation marks; a Schroders trust recently announced a 46% valuation cut in its Revolut investment, acquired at the July 2021 funding round
- SVF2 acquired 5% of Revolut, also in July 2021; third party valuation providers indicate that the Revolut USD valuation has fallen by at least 50% in 2022
- July 2021 was Revolut’s most recent funding round, implying that Softbank may yet need to mark down its valuation; this could also apply to the funds’ other private companies
CyberAgent: Growth Avenues Seem Limited and Further Downside to Consensus
- CA reported 2QFY09/2023 results today. Revenue increased 2.4% YoY to ¥195.6bn (vs consensus ¥191.0bn) while operating profit declined 27.0% YoY to ¥18.8bn (vs consensus ¥18.0bn).
- The viewership for AbemaTV has fallen back to pre-FIFA levels and revenue growth from AbemaTV has been on a declining trend.
- CA didn’t release any gaming titles despite mentioning about 3 for 2022. The company has mentioned about 2 titles for FY09/2023 and the segment seems struggling with producing hit titles.
💡 Before it’s here, it’s on Smartkarma
Sign Up for Free
The Smartkarma Preview Pass is your entry to the Independent Investment Research Network
- ✓ Unlimited Research Summaries
- ✓ Personalised Alerts
- ✓ Custom Watchlists
- ✓ Company Data and News
- ✓ Events & Webinars
