Investing in Japan: Geo Holdings' financial results for FY 2019

-

At-home consumption increased but market contraction dragged down profits


Geo Holdings Corporation, located in Aichi prefecture, provides DVD rental service and second hand merchandises including used smartphones. The company has recently been expanding used smartphone business taking advantage of a related law revision in October 2019 which is expected to expand used smart phone market. 
Geo Holdings announced its consolidated financial results for FY 2019

 On May 11, Geo Holdings Corporation announced its consolidated financial results for the fiscal year ending March 2020. Although sales increased 4.3% year on year to 305 billion yen, operating income fell by 36% to 10 billion yen, ordinary income decreased 38.9% to 10.7 billion yen and net income was down 62.7% to 3.8 billion yen. 
Geo Holdings announced its consolidated financial results for FY 2019

 Demand from at-home consumption grew due to the spread of new coronavirus infections, but the contraction of the rental market for DVDs and videos gave negative impacts on its profits. In addition, as sales of downloaded game software expanded, Geo Holdings’ sales of new game consoles and software at actual stores were sluggish. 

 On the other hand, sales at existing second-hand stores such as “2nd Street” were firm against the backdrop of second-hand market expansion in Japan.

Geo aims to grow in the second-hand market


Regarding the future forecast, the company expects downward trend to continue in rental merchandise market. Because of that, the company’s sales for the fiscal year ending March 2021 will fall 1.7% year on year to 300 billion yen, operating income will decrease 40.1% to 6.0 billion yen, and net income is forecasted to be 3.2 billion yen, falling 16.8%. 

 As for future business development, Geo aims to enhance sales of used smartphones and online transactions while continuing to expand number of its second-hand stores such as “2nd Street” both in Japan and overseas in order to capture growing demand for reuse and online businesses. 

 Right now, Geo Holdings Corporation faces severe business environment, but the company accumulated enough financial assets during recent profitable time to ride through present rough situation. With a recent correction in the Japanese stock market, Geo Holdings Corporation’s stock price may look fairly attractive to value seeking investors.


Geo Holdings announced its consolidated financial results for FY 2019

Comments

Post a Comment

Popular posts from this blog

Food and Drinks: Kaiten-sushi serves fresh and high quality of seafood

-
Image
Conveyor belt sushi , also known as Kaiten-sushi is a semi-self-service type, inexpensive sushi restaurant where small plates bringing various types of sushi on them are continuously circulated on chain conveyors installed along the seats.  Fresh and well-made sushi can be enjoyed for relatively cheap prices there. Plates typically come with one or two sushi pieces each and customers pick up plates they like. Customers can also place orders through a touch screen at each table when sushi they like is not available on conveyor belts.  Those Sushi are usually served on plates with several colors showing their prices ranging from 100 yen to around 500 yen. Some restaurants set the same price for all plates. The lowest price for a plate is usually 100 yen. That is why Kaiten-sushi is often called "100 yen sushi" and very popular among Japanese. Customers are given their bills from a staff who counts plates when they finish eating. Kaiten-sushi has grown thanks to technologie...
Read more

Investing in Japan: Menicon, a leading Japanese contact lens manufacturer, aims overseas market expansion

-
Image
Menicon secured profit growth amid COVID-19 disruptions Menicon Co., Ltd. is a leading contact lens manufacturer in Japan founded in 1951, headquartered in Nagoya. It consistently develops, manufactures and sells contact lenses and related products in-house. To date, Menicon has developed various types of contact lenses such as hard lenses, soft lenses, disposables (disposable), lenses for astigmatism and bifocal lenses. It has the No. 1 market share for hard lenses and the No. 2 market for soft lenses in Japan.  As for the recent consolidated financial results, Menicon announced that net income for the fiscal year ended March 31, 2020 was 4 billion yen, up 14% from the previous year. While the sales and profits of most Japanese companies fell sharply due to the spread of new coronavirus infections, Menicon increased its sales by 4.5% from the previous year to 84.5 billion yen, a record high for the fifth consecutive year since listing of its stock. On the other hand, the earning...
Read more

Investing in Japan: Toyota shows its strength shrugging off pandemic damage and semiconductor shortage

-
Image
COVID-19 cases rise in Japan amid state of emergency, Tokyo Olympics and Paralympics to be downsized The Japanese government has decided to add three prefectures to its state of emergency as coronavirus cases continue to rise.   Prime Minister Yoshihide Suga said on May 14 that he decided to expand a COVID-19 state of emergency covering Tokyo and other areas to three more prefectures as infections continue to surge ahead of the Summer Olympics.  Starting on May 15, it will cover Hokkaido, Okayama and Hiroshima in an effort to curb infections and ease the strain on medical systems. The government will also designate three more prefectures as areas where intensive virus measures should be taken which is often called “Manbou”, acronym in Japanese for quasi-emergency to contain the virus.  Daily new cases have been on the rise nationwide in recent weeks reaching more than 6,000 for the fourth straight day as of May 14. The recent spike in new cases forces the organizers of ...
Read more