Telco/Internet specialist

Kirk Boodry

Redex Research

Equity Bottom-Up

<ul>
<li>Results for Q2 were better than we expected as B2B sales growth remained robust whilst cost savings on the consumer side boosted margins</li>
<li>A rather robust decline in revenue for Lohaco is the only negative that stands out but this was partially anticipated whilst the corresponding cost savings are a boon</li>
<li>An 11% increase in operating profit for Q2 offsets weakness from the previous report and puts the company on track to meet guidance for full-year growth</li>
</ul>


Results for Q2 were better than we expected as B2B sales growth remained robust whilst cost savings on the consumer side boosted margins
A rather robust decline in revenue for Lohaco is the only negative that stands out but this was partially anticipated whilst the corresponding cost savings are a boon
An 11% increase in operating profit for Q2 offsets weakness from the previous report and puts the company on track to meet guidance for full-year growth


Askul Q2 23 Results Reaction: B2B Growth and B2C Cost Savings Drive Solid Quarter

Expert on Japan Retail and Consumer Markets, JapanConsuming

Michael Causton

Expert on Japan Retail and Consumer Markets

Real Insight on Japanese Consumer Markets

JapanConsuming

JapanConsuming is a specialist research firm producing intelligence on Japanese retail and consumer markets. Founded in 2000, JapanConsuming has become the leading provider of insights on Japanese retailers and consumer trends to retailers, brands, government agencies and investors. As well as a highly regarded monthly report on the market, JapanConsuming produces in-depth reports on retail sectors, seminars on key trends and telephone consulting to investors on trends and retailers.

JapanConsuming was founded by Michael Causton and Roy Larke. 

<ul>
<li>Quick (Q)-commerce continues to grow, with rapid home delivery providing a new level of convenience to meet demand from busy, urban consumers.  </li>
<li>Z Holdings’ team of Yahoo, Askul and Demae-can have run what is now called Yahoo Mart since 2020 which has opened its first three retail stores, a new omnichannel model.</li>
<li>Given the data analysis and supply chain power of its backers, these stores could quickly become a thorn in the side of the big convenience store chains.</li>
</ul>


Quick (Q)-commerce continues to grow, with rapid home delivery providing a new level of convenience to meet demand from busy, urban consumers.  
Z Holdings’ team of Yahoo, Askul and Demae-can have run what is now called Yahoo Mart since 2020 which has opened its first three retail stores, a new omnichannel model.
Given the data analysis and supply chain power of its backers, these stores could quickly become a thorn in the side of the big convenience store chains.


Yahoo Mart's Q-Conbini Stores: A Potential Competitor to the Big 3 CVS?

Thematic (Sector/Industry)

<ul>
<li>The Japan telecom and Internet companies in our coverage universe held ¥1,253bn in public equities as of Q2(Sep) largely built through capital alliances tied to business collaboration</li>
<li>NTT has the largest portfolio at c. ¥958bn (7% of market cap) followed by KDDI. Toyota (¥354bn) and JTower (three strategic telcos) are the largest and most widely held </li>
<li>The P&amp;L impact of valuation changes in Q2 should be muted. We have included tables for all the companies in our coverage</li>
</ul>


The Japan telecom and Internet companies in our coverage universe held ¥1,253bn in public equities as of Q2(Sep) largely built through capital alliances tied to business collaboration
NTT has the largest portfolio at c. ¥958bn (7% of market cap) followed by KDDI. Toyota (¥354bn) and JTower (three strategic telcos) are the largest and most widely held 
The P&amp;L impact of valuation changes in Q2 should be muted. We have included tables for all the companies in our coverage


Japan Telecoms/Internet - A Quick Look at Public Equity Portfolios

<ul>
<li>
<a href="https://www.smartkarma.com/entities/askul-corp" target="_blank" data-smartkarma-citation="entities:16807:1" rel="noopener">Askul Corp (2678 JP)</a> posted the best revenue growth in six quarters as both B2B and consumer product sales accelerated</li>
<li>The corresponding operating income decline of 10% is less welcome but that includes a front-loading of planned growth investments and full year guidance of 1% growth is unchanged</li>
<li>We are tagging this insight as bearish as headlines of a 10% OP decline might not be as well received as the top-line story </li>
</ul>



Askul Corp (2678 JP) posted the best revenue growth in six quarters as both B2B and consumer product sales accelerated
The corresponding operating income decline of 10% is less welcome but that includes a front-loading of planned growth investments and full year guidance of 1% growth is unchanged
We are tagging this insight as bearish as headlines of a 10% OP decline might not be as well received as the top-line story 


Askul Q1 23 Results Reaction: Solid Revenue but OP Down on Front-Loaded Investments

<ul>
<li>Askul posted Q4 results that were largely in-line and issued FY23 targets that are robust for revenue growth (+6%) but accompanied by upfront investment</li>
<li>Management also announced it would prepare subsidiary AlphaPurchase for a public listing although the timing has not been determined</li>
<li>The miss on profitability guidance is not ideal but the acceleration of top-line growth is attractive</li>
</ul>


Askul posted Q4 results that were largely in-line and issued FY23 targets that are robust for revenue growth (+6%) but accompanied by upfront investment
Management also announced it would prepare subsidiary AlphaPurchase for a public listing although the timing has not been determined
The miss on profitability guidance is not ideal but the acceleration of top-line growth is attractive


Askul Corp - Q4 22 Results Reaction: Mixed as Growth Looks Appealing but Profits Light

Japan

ASKUL Corporation sells office equipment products to medium and small sized business offices via the Internet and facsimiles.  The Company provides next day delivery services throughout Japan.

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Askul Corp (2678 JP)

Askul Q2 23 Results Reaction: B2B Growth and B2C Cost Savings Drive Solid Quarter

A solid Q2 puts Askul back on track for full-year growth in operating profit driven by high single-digit growth in B2B eCommerce

Kirk Boodry

Yahoo Mart's Q-Conbini Stores: A Potential Competitor to the Big 3 CVS?

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Kirk Boodry

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Askul posted the best revenue growth in six quarters but one-time growth investments drove corresponding OP down 10%. The good news is the rest of...

Kirk Boodry

Askul Corp - Q4 22 Results Reaction: Mixed as Growth Looks Appealing but Profits Light

Askul is forecasting 6% top-line growth for the coming year, in line with mid-term plans, but like parent Z Holdings, investment to drive its FY25...

Kirk Boodry

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