'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

Long-Short Analysis on Japan, Asia and the World

LightStream Research

LightStream conducts quantitatively rigorous and data-driven analysis with a focus on Japan and Asia.

We consistently cover the Tech, Consumer and Industrial sectors, and provide ECM and Events coverage more broadly.

We supplement traditional qualitative insights from company relationships with a robust quantitative foundation that examines as much historical data as is available.
We further refine the accuracy of our insights and calls through the use of alternative data to flesh out current trends, and through a valuation framework that emphasises non-superficial peer group selection and a proper attempt to understand the metrics and changes that have driven security valuations in the past.

Thematic (Sector/Industry)

<p style="text-align: center;"><strong>• LARGE CAP RESULTS - 5th APRIL •</strong></p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/987/original/image_46394735821617656683433.png?1617656684" class="editor-image img-responsive" data-smartkarma-image-id="198987"></figure><div class="content-caption"> Source for all charts &amp; tables: Japan Analytics</div><p><strong>RESULTS</strong> - Of Friday's 23 results, only 10 scored positively; however, 73% of annual revisions were positive. Of the larger caps, <a href="https://www.smartkarma.com/entities/shimamura-co-ltd" target="_blank" data-smartkarma-citation="entities:15213:1" rel="noopener">Shimamura (8227 JP)</a> had a third-successive positive quarter, while <a href="https://www.smartkarma.com/entities/kewpie-corp" target="_blank" data-smartkarma-citation="entities:10681:1" rel="noopener">Kewpie (2809 JP)</a> and <a href="https://www.smartkarma.com/entities/adastria-co-ltd" target="_blank" data-smartkarma-citation="entities:11895:1" rel="noopener">Adastria (2685 JP)</a> had double-digit year-on-year sales declines, and drugstore <a href="https://www.smartkarma.com/entities/create-sd-holdings-co" target="_blank" data-smartkarma-citation="entities:12945:1" rel="noopener">Create SD (3148 JP)</a> saw profits decline.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/989/original/image_51513331531617657092402.png?1617657093" class="editor-image img-responsive" data-smartkarma-image-id="198989"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/990/original/image_56921939741617657150504.png?1617657151" class="editor-image img-responsive" data-smartkarma-image-id="198990"></figure><p style="text-align: center;"><strong>• LARGER CAP FORECASTS/REVISIONS - 5th APRIL • </strong></p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/991/original/image_89489650351617657220460.png?1617657221" class="editor-image img-responsive" data-smartkarma-image-id="198991"></figure><p><strong>FORECASTS/REVISIONS</strong> - Adastria offset its weak results with a bullish FY22 forecast, as did restaurant chain <a href="https://www.smartkarma.com/entities/ichibanya-co-ltd" target="_blank" data-smartkarma-citation="entities:2914:1" rel="noopener">Ichibanya (7630 JP)</a>. Shimamura's interim forecast was much more bullish than for the full year. <a href="https://www.smartkarma.com/entities/kobe-steel-ltd" target="_blank" data-smartkarma-citation="entities:209:1" rel="noopener">Kobe Steel (5406 JP)</a> revised up further into the black, while <a href="https://www.smartkarma.com/entities/jins-holdings-inc" target="_blank" data-smartkarma-citation="entities:12002:1" rel="noopener">JINS (3046 JP)</a> revised its interim and full-year sales and operating income slightly lower.</p><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/992/original/image_65197346461617657668077.png?1617657668" class="editor-image img-responsive" data-smartkarma-image-id="198992"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/198/993/original/image_33740867171617657704461.png?1617657705" class="editor-image img-responsive" data-smartkarma-image-id="198993"></figure>

• LARGE CAP RESULTS - 5th APRIL • Source for all charts &amp; tables: Japan AnalyticsRESULTS - Of Friday's 23 results, only 10 scored positively; however, 73% of annual revisions were positive. Of the larger caps, Shimamura (8227 JP) had a third-successive positive quarter, while Kewpie (2809 JP) and Adastria (2685 JP) had double-digit year-on-year sales declines, and drugstore Create SD (3148 JP) saw profits decline.• LARGER CAP FORECASTS/REVISIONS - 5th APRIL • FORECASTS/REVISIONS - Adastria offset its weak results with a bullish FY22 forecast, as did restaurant chain Ichibanya (7630 JP). Shimamura's interim forecast was much more bullish than for the full year. Kobe Steel (5406 JP) revised up further into the black, while JINS (3046 JP) revised its interim and full-year sales and operating income slightly lower.

🇯🇵 JAPAN • Results & Revisions 04/​05 - Shimamura & JINS

<div><p style="text-align: center;"><strong>• BEST &amp; WORST •</strong></p></div><div>
<p>Our best and worst pair from Monday's announcements is <a href="https://www.smartkarma.com/entities/weathernews-inc" target="_blank" data-smartkarma-citation="entities:16991:1" rel="noopener">Weathernews (4825 JP)</a> and <a href="https://www.smartkarma.com/entities/coca-cola-bottlers-japan" target="_blank" data-smartkarma-citation="entities:20051:1" rel="noopener">Coca Cola Bottlers Japan (2579 JP)</a>. </p>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/489/original/2020-10-06_05-34-42.png?1601930214" class="editor-image img-responsive" data-smartkarma-image-id="163489"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/163/490/original/2020-10-06_05-35-26.png?1601930263" class="editor-image img-responsive" data-smartkarma-image-id="163490"></figure><div class="content-caption">Source for all charts &amp; tables: Japan Analytics</div>
<div><p>DAILY STATS</p></div>
<hr>
<div><p style="text-align: center;"><strong>12 Quarterly Results</strong></p></div>
<div><ul style="list-style-type: disc;">
<li><p><strong>Results Score:</strong> 33% Positive / 8% Neutral / 58% Negative</p></li>
<li><p><strong>Average Results Score Change:</strong> -2.0 points</p></li>
<li><p><strong>Average % Change in Revenue:</strong> -12.5% Quarter YoY / -5.1% Rolling TTM YoY </p></li>
<li><p><strong>Average Operating Profit Margin Change:</strong> -3.3ppt</p></li>
<li><p><strong>Percentage Making Quarterly Losses:</strong> 25%</p></li>
</ul></div>
<hr>
<div><p style="text-align: center;"><strong>10 Annual • 5 Interim Forecasts/Revisions</strong></p></div>
<div><ul style="list-style-type: disc;">
<li><p><strong>Annual Forecast/Revision Score:</strong> 50% Positive /20% Neutral / 30% Negative</p></li>
<li><p><strong>Interim Forecast/Revision Score Change:</strong> 20% Positive / 0% Neutral / 80% Negative</p></li>
<li><p><strong>Average Forecast/Revision Score Change:</strong> -5.1 point</p></li>
</ul></div>
</div>

• BEST &amp; WORST •
Our best and worst pair from Monday's announcements is Weathernews (4825 JP) and Coca Cola Bottlers Japan (2579 JP). 
Source for all charts &amp; tables: Japan Analytics
DAILY STATS

12 Quarterly Results

Results Score: 33% Positive / 8% Neutral / 58% Negative
Average Results Score Change: -2.0 points
Average % Change in Revenue: -12.5% Quarter YoY / -5.1% Rolling TTM YoY 
Average Operating Profit Margin Change: -3.3ppt
Percentage Making Quarterly Losses: 25%


10 Annual • 5 Interim Forecasts/Revisions

Annual Forecast/Revision Score: 50% Positive /20% Neutral / 30% Negative
Interim Forecast/Revision Score Change: 20% Positive / 0% Neutral / 80% Negative
Average Forecast/Revision Score Change: -5.1 point



🇯🇵 JAPAN • Results & Revisions - 10/​​​​​​05 Fuji, Weathernews, Create SD, Daikin, Coca Cola Japan

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. 

<p>At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of financial results for FY2019-20.</p>
<p>Even with the crisis, results were generally better than for FY2018 – although there are big variations by sector.</p>
<p>Those differences are more or less what we’ve come to expect, with traditional formats like department stores continuing to struggle, while those formats that have adopted modern management are doing well.</p>
<p>The following is an in-depth review of Japan's retail sector, providing:</p>
<ul>
<li>An overview of consumer demand and retail performance</li>
<li>Format by format reviews showing growth and profit performance across all the main formats: convenience stores, supermarkets, GMS, consumer electronics, drugstores, homecentres, department stores, apparel, home and other specialty  formats.</li>
<li>Rankings:
<ul>
<li>Market share and size by sector/format</li>
<li>By sales for all retailers with sales over ¥250 billion</li>
<li>By gross and operating margins, split by format and category.</li>
</ul>
</li>
</ul>
<p>As this is an in-depth insight, the review is split into two parts to make it easier to read.  This is Part II which provides snapshot reviews of each format/sector. <a href="https://www.smartkarma.com/insights/the-japan-retail-review-winners-and-losers-in-japanese-retailing-part-i" target="_blank" rel="noopener">Part I, which provides a quick overview of all retailing, can be read here</a>.</p>

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of financial results for FY2019-20.
Even with the crisis, results were generally better than for FY2018 – although there are big variations by sector.
Those differences are more or less what we’ve come to expect, with traditional formats like department stores continuing to struggle, while those formats that have adopted modern management are doing well.
The following is an in-depth review of Japan's retail sector, providing:

An overview of consumer demand and retail performance
Format by format reviews showing growth and profit performance across all the main formats: convenience stores, supermarkets, GMS, consumer electronics, drugstores, homecentres, department stores, apparel, home and other specialty  formats.
Rankings:

Market share and size by sector/format
By sales for all retailers with sales over ¥250 billion
By gross and operating margins, split by format and category.



As this is an in-depth insight, the review is split into two parts to make it easier to read.  This is Part II which provides snapshot reviews of each format/sector. Part I, which provides a quick overview of all retailing, can be read here.

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

<div>
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/145/930/original/2020-07-14_08-06-05.png?1594681580" class="editor-image img-responsive" data-smartkarma-image-id="145930"></figure><figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/145/928/original/2020-07-14_07-58-53.png?1594681168" class="editor-image img-responsive" data-smartkarma-image-id="145928"></figure><div class="content-caption">Source • Japan Analytics</div>
<p><strong><a href="https://www.smartkarma.com/entities/create-sd-holdings-co" target="_blank" data-smartkarma-citation="entities:12945:1" rel="noopener">Create SD (3148 JP)</a> -</strong> Of the larger-cap companies reporting yesterday, drugstore Create SD had the best overall Results Score, although the company is forecasting lower profits and operating margins for the current year. The zero market-implied long-term growth rate is overly conservative, and the shares have yet to reach a new Relative Price Score high, suggesting further upside.   </p>
<p style="text-align: center;"><strong>DAILY STATS</strong></p>
</div><hr><div><p style="text-align: center;"><strong>51 Quarterly Results</strong></p></div><div><ul>
<li>
<strong>Results Score:</strong> 14 Positive / 3 Neutral / 34 Negative</li>
<li>
<strong>Average Results Score Change:</strong> -4.7</li>
<li>
<strong>Average % Change in Revenue:</strong> -14.9% Quarter YoY / -2.2% Rolling TTM YoY</li>
<li>
<strong>Average Operating Profit Margin Change:</strong> -1.6ppt</li>
<li>
<strong>Percentage Making Quarterly Losses:</strong> 37%</li>
</ul></div><hr><div><p style="text-align: center;"><br><strong>22 Annual • 8 Interim Forecasts/Revisions</strong></p></div><div><ul>
<li>
<strong>Annual Forecast/Revision Score:</strong> 5 Positive / 3 Neutral / 14 Negative</li>
<li>
<strong>Interim Forecast/Revision Score Change:</strong> 4 Positive / 0 Neutral / 4 Negative</li>
<li>
<strong>Average Forecast/Revision Score Change: </strong>-7.7</li>
</ul></div>


Source • Japan Analytics
Create SD (3148 JP) - Of the larger-cap companies reporting yesterday, drugstore Create SD had the best overall Results Score, although the company is forecasting lower profits and operating margins for the current year. The zero market-implied long-term growth rate is overly conservative, and the shares have yet to reach a new Relative Price Score high, suggesting further upside.   
DAILY STATS
51 Quarterly Results

Results Score: 14 Positive / 3 Neutral / 34 Negative

Average Results Score Change: -4.7

Average % Change in Revenue: -14.9% Quarter YoY / -2.2% Rolling TTM YoY

Average Operating Profit Margin Change: -1.6ppt

Percentage Making Quarterly Losses: 37%
 22 Annual • 8 Interim Forecasts/Revisions

Annual Forecast/Revision Score: 5 Positive / 3 Neutral / 14 Negative

Interim Forecast/Revision Score Change: 4 Positive / 0 Neutral / 4 Negative

Average Forecast/Revision Score Change: -7.7


🇯🇵 JAPAN • Results & Revisions 13th July

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/126/826/original/File%202020-04-06%2014%2031%2044.jpeg?1586211571" class="editor-image img-responsive" data-smartkarma-image-id="126826"></figure><div class="content-caption">Source • Financial Times</div><p><strong>ABE ROLLS THE DICE</strong> - Japan's solution to the recent alarming rise in COVID-19 infections is to adopt a middle way between those adopted by Sweden and the lockdown countries. The full details will emerge later today but will include constraints on social gatherings in certain major cities as well as a stimulus package equivalent to 20% of GDP. In a tacit acknowledgement that Japanese non-consumer facing businesses cannot function from home, companies will be requested to comply with the principle of 'stay-at-home' as much as possible; however, public transportation systems will operate as usual with no reduction in capacity. The measures will be in place until the end of the extended Golden Week holiday period that ends on 6th March. In effect, Japan will be in semi-social-distancing mode for the next three weeks. After that, should the R0 be below 1, Japan reverts to business-as-usual.</p><p><strong>BIFURCATION</strong> - The implications of these policies for the market should be considered positive and when combined with the stimulus package reduced the risk of a two-stage decline as noted in our market update <a href="https://www.smartkarma.com/insights/japan-market-update-5th-april-2020-overshoot" target="_blank" data-smartkarma-citation="insights:38114" rel="noopener"> Overshoot</a>. Domestically-orientated non-consumer facing businesses are relatively well-placed in this post-COVID world. Globally-exposed businesses will still suffer, and some will be dependent on government support to survive. We would look to add to oversold stocks in the former group while waiting for selling or shorting opportunities as sentiment towards the latter recovers before the inevitable comprise in earnings. Accordingly, this Insight is BULLISH.</p><p>In the <strong>DETAIL</strong> below, we shall review the Revision and Results announced yesterday. The following quotation is a good summation of the philosophy behind "The Japan Experiment':-</p><blockquote><p><strong>"The Japanese system is a set of equations optimizing for minimal pressure for institutional change by maximising leadership wiggle room, subject to the constraint of providing the entire populace a minimally acceptable quality of life for a rich nation." - Richard Hostetter </strong></p></blockquote>

Source • Financial TimesABE ROLLS THE DICE - Japan's solution to the recent alarming rise in COVID-19 infections is to adopt a middle way between those adopted by Sweden and the lockdown countries. The full details will emerge later today but will include constraints on social gatherings in certain major cities as well as a stimulus package equivalent to 20% of GDP. In a tacit acknowledgement that Japanese non-consumer facing businesses cannot function from home, companies will be requested to comply with the principle of 'stay-at-home' as much as possible; however, public transportation systems will operate as usual with no reduction in capacity. The measures will be in place until the end of the extended Golden Week holiday period that ends on 6th March. In effect, Japan will be in semi-social-distancing mode for the next three weeks. After that, should the R0 be below 1, Japan reverts to business-as-usual.BIFURCATION - The implications of these policies for the market should be considered positive and when combined with the stimulus package reduced the risk of a two-stage decline as noted in our market update  Overshoot. Domestically-orientated non-consumer facing businesses are relatively well-placed in this post-COVID world. Globally-exposed businesses will still suffer, and some will be dependent on government support to survive. We would look to add to oversold stocks in the former group while waiting for selling or shorting opportunities as sentiment towards the latter recovers before the inevitable comprise in earnings. Accordingly, this Insight is BULLISH.In the DETAIL below, we shall review the Revision and Results announced yesterday. The following quotation is a good summation of the philosophy behind "The Japan Experiment':-"The Japanese system is a set of equations optimizing for minimal pressure for institutional change by maximising leadership wiggle room, subject to the constraint of providing the entire populace a minimally acceptable quality of life for a rich nation." - Richard Hostetter 

🇯🇵 JAPAN • Revisions & Results Update 6th April - The Japanese Experiment

Japan

CREATE SD HOLDINGS Co Ltd operates a chain of drug stores based in Kanagawa. The Company sells medical supplies, cosmetics, foodstuff, baby products and daily goods. CREATE SD HOLDINGS also sells prescription medicine.

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Create Sd Holdings Co (3148 JP)

🇯🇵 JAPAN • Results & Revisions 04/05 - Shimamura & JINS

RESULTS - Of Friday's 23 results, only 10 scored positively; however, 73% of annual revisions were positive. Of the larger caps, Shimamura (8227...

Campbell Gunn

🇯🇵 JAPAN • Results & Revisions - 10/05 Fuji, Weathernews, Create SD, Daikin, Coca Cola Japan

• BEST & WORST • Our best and worst pair is home centre Shimachu (8184 JP) for whom a rumoured bid from peer DCM has emerged and diaper...

Campbell Gunn

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of...

Michael Causton

🇯🇵 JAPAN • Results & Revisions 13th July

Create SD (3148 JP) - Of the larger-cap companies reporting yesterday, drugstore Create SD had the best overall Results Score, although the...

Campbell Gunn

🇯🇵 JAPAN • Revisions & Results Update 6th April - The Japanese Experiment

ABE ROLLS THE DICE - Japan's solution to the recent alarming rise in COVID-19 infections is to adopt a middle way between those adopted by Sweden...

Campbell Gunn

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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🇯🇵 JAPAN • Results & Revisions 04/​05 - Shimamura & JINS

RESULTS - Of Friday's 23 results, only 10 scored positively; however, 73% of annual revisions were positive. Of the larger caps, Shimamura (8227...

Campbell Gunn

🇯🇵 JAPAN • Results & Revisions - 10/​​​​​​05 Fuji, Weathernews, Create SD, Daikin, Coca Cola Japan

• BEST & WORST • Our best and worst pair is home centre Shimachu (8184 JP) for whom a rumoured bid from peer DCM has emerged and diaper...

Campbell Gunn

Japan Retail Review 2019-20 Part II: A Sector by Sector Review of Winners and Losers

At least until the Covid-19 crisis hit Japan in January, the majority of retailers were gearing up to announce yet another really good year of...

Michael Causton

🇯🇵 JAPAN • Results & Revisions 13th July

Create SD (3148 JP) - Of the larger-cap companies reporting yesterday, drugstore Create SD had the best overall Results Score, although the...

Campbell Gunn

🇯🇵 JAPAN • Revisions & Results Update 6th April - The Japanese Experiment

ABE ROLLS THE DICE - Japan's solution to the recent alarming rise in COVID-19 infections is to adopt a middle way between those adopted by Sweden...

Campbell Gunn

🇯🇵 JAPAN • Results & Revisions 04/05 - Shimamura & JINS

🇯🇵 JAPAN • Results & Revisions - 10/05 Fuji, Weathernews, Create SD, Daikin, Coca Cola Japan