Senior Technology Analyst, Japanese Equities, LightStream Research

Scott Foster

Senior Technology Analyst, Japanese Equities

ja research

ja research is an independent research platform focused exclusively on Japanese equities. Leveraging data and graphic analysis provided by Japan Analytics, we provide insights on small and medium-sized companies that have been ignored by the sell-side as well as challenging conventional wisdom on larger companies. We also offer analyst and corporate access, the latter with translation if required. 

Equity Bottom-Up

September quarter financials were good enough to support a rebound in the share price, which dropped from ¥3,305 on October 3 to ¥2,228 on October 29, but closed at ¥2,746 on November 9 (prices adjusted for the 2-for-1 split that took effect on October 1). The results, which were announced on October 26, showed sales up 23.3% and operating profit up 18.6% year-on-year in the nine months to September; and up 22.5% and 15.2%, respectively, in 3Q. Profitability was suppressed by the cost of expansion and continued losses at overseas subsidiaries. The balance sheet continued to strengthen, with net cash rising to 11.9% of equity from 2.2% at the end of last fiscal year.In nominal terms, parent company sales were up 23.2% year-on-year in 3Q, with increases of 29.8% in July, 25.3% in August and 15.1% in September. However, when adjusted for the number of days worked, the monthly data shows a positive trend, with sales growth rising from 23.6% in July and 19.9% in August to 27.9% in September and 23.9% in 3Q as a whole. At ¥2,746, the shares are selling at 66x our EPS estimate for FY Dec-18, 43x EV/EBITDA and 6.2x sales. Our estimates for FY Dec-20 reduce these multiples to 51x, 33x and 4.6x. These and other valuation multiples are high in absolute terms, but in the middle of their recent historical ranges. Despite the company's successful business model, the share price looks vulnerable to the economic slowdown now unfolding.<div class="content-highlight">MonotaRO is the only pure-play e-commerce MRO (Maintenance, Repair and Operation) investment in the Japanese stock market. With over 10,000 SKUs (stock keeping units - i.e., individual items, including gloves, hand and power tools, hardware, painting supplies, etc.) for sale to construction companies, manufacturers, auto repair shops and other customers, the company is both driving and benefitting from the growth of Japan's B2B MRO market. Overseas subsidiaries in South Korea, Indonesia and China, which account for about 4% of consolidated sales, are not yet profitable.</div>

September quarter financials were good enough to support a rebound in the share price, which dropped from ¥3,305 on October 3 to ¥2,228 on October 29, but closed at ¥2,746 on November 9 (prices adjusted for the 2-for-1 split that took effect on October 1). The results, which were announced on October 26, showed sales up 23.3% and operating profit up 18.6% year-on-year in the nine months to September; and up 22.5% and 15.2%, respectively, in 3Q. Profitability was suppressed by the cost of expansion and continued losses at overseas subsidiaries. The balance sheet continued to strengthen, with net cash rising to 11.9% of equity from 2.2% at the end of last fiscal year.In nominal terms, parent company sales were up 23.2% year-on-year in 3Q, with increases of 29.8% in July, 25.3% in August and 15.1% in September. However, when adjusted for the number of days worked, the monthly data shows a positive trend, with sales growth rising from 23.6% in July and 19.9% in August to 27.9% in September and 23.9% in 3Q as a whole. At ¥2,746, the shares are selling at 66x our EPS estimate for FY Dec-18, 43x EV/EBITDA and 6.2x sales. Our estimates for FY Dec-20 reduce these multiples to 51x, 33x and 4.6x. These and other valuation multiples are high in absolute terms, but in the middle of their recent historical ranges. Despite the company's successful business model, the share price looks vulnerable to the economic slowdown now unfolding.MonotaRO is the only pure-play e-commerce MRO (Maintenance, Repair and Operation) investment in the Japanese stock market. With over 10,000 SKUs (stock keeping units - i.e., individual items, including gloves, hand and power tools, hardware, painting supplies, etc.) for sale to construction companies, manufacturers, auto repair shops and other customers, the company is both driving and benefitting from the growth of Japan's B2B MRO market. Overseas subsidiaries in South Korea, Indonesia and China, which account for about 4% of consolidated sales, are not yet profitable.

MonotaRO (3064 JP): Good September Results, Valuations Still High

'Quantamental' Japan Specialist, LightStream Research

Campbell Gunn

'Quantamental' Japan Specialist

Quantitative Analysis

THE J 'NIFTY-FIFTY' - In our insight posted on July 1st <a href="https://www.smartkarma.com/insights/japan-most-overbought-most-oversold-the-relative-price-score" target="_blank" data-smartkarma-citation="insights:21149">Japan: Most Overbought &amp; Most Oversold - The Relative Price Score</a>, we highlighted the emergence of a momentum-driven concentration in a small number of over-priced growth stocks which we dubbed "Japan's Nifty-Fifty". At that time, this group of stocks - many of which are widely held in foreign investor portfolios - had produced a one-year performance of 60%, substantially outperforming all benchmarks. As we then observed,    
<blockquote>
For portfolio managers willing to go along for this ride, the result has been a career-defining period of relative glory while value-orientated peers have suffered another year in the performance 'doghouse’. The last chapter of this tale requires no spoiler alert. Currently, twenty-eight of our fifty have negative of flat earnings momentum and eighteen have seen a decline in Relative Price Score in the last month. We look for further downside ahead in earnings and price momentum.
</blockquote>
LAST CHAPTER? - Whether or not we have reached the final chapter of this particular tale, recent months have not been kind to this 'strategy'. The simple average has declined by 20% over both one and three months compared to declines in the market composite of 12% and 10%, respectively. Over one year, the outperformance has declined from 54% to 18%. Certainly, momentum growth stocks have always been a feature of the Japanese market, and many could now well bounce hard with any market recovery. However, when earnings momentum turns down or negative, as it has done recently for <a href="https://www.smartkarma.com/entities/18379" target="_blank" data-smartkarma-citation="entities:18379:1">ZOZO Inc (3092 JP)</a>, <a href="https://www.smartkarma.com/entities/15441" target="_blank" data-smartkarma-citation="entities:15441:1">Monotaro (3064 JP)</a> and <a href="https://www.smartkarma.com/entities/15017" target="_blank" data-smartkarma-citation="entities:15017:1">Misumi (9962 JP)</a>, the lack of valuation support can result in short, sharp price shocks that can nullify months of relative out-performance in a few trading sessions.
TOO MUCH OF A GOOD THING - As with the US 'FAANGs, in the end, all things must pass. The chart below shows the one-year progression of the 50 companies measured by Relative Price Score which plots the relative performance of all companies on the same scale. The 4.0 'Overbought' line is the first percentile of observations for all currently-listed companies since 1990.
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/068/256/original/2018-10-30_20-59-41.png?1540900797" class="editor-image img-responsive" data-smartkarma-image-id="68256"></figure>
<div class="content-caption">Source: Japan Analytics</div>
THE JULY 2018 'NIFTY-FIFTY' - The July 2018 'portfolio' in the table below has data as of that date. The average one-year performance was +60%, the average Price Score was 4.09 - just above the 'Overbought' line - while the average PER was 60x and PBR 8.43. The average Results Score was 8 out of a maximum of 30 and the average change from the previous quarter was -1. Only three companies, <a href="https://www.smartkarma.com/entities/1273" target="_blank" data-smartkarma-citation="entities:1273:1">OBIC (4684 JP)</a>, <a href="https://www.smartkarma.com/entities/985" target="_blank" data-smartkarma-citation="entities:985:1">Mcdonald's Japan (2702 JP)</a> and <a href="https://www.smartkarma.com/entities/7431" target="_blank" data-smartkarma-citation="entities:7431:1">Outsourcing (2427 JP)</a>, were not 'Fully Priced'.
<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/068/315/original/2018-10-31_10-06-20.png?1540948009" class="editor-image img-responsive" data-smartkarma-image-id="68315"></figure>
<div style="text-align: left;" class="content-caption">The J Nifty Fifty - July 2018 companies are presented in descending order of Market Capitalisation. The selection criteria were: market capitalisation higher than ¥183b, Relative Price Score of over 2.5, PE ratio of over 30 and PBR of over 3. "FP" means Fully Priced - a company that ranked in both the top 20% in terms of PER and PBR.  Price Score and Results Score are as defined in earlier insights.</div>
In the next section, we provide an updated performance review of the July selection, as well as updating the Nifty-Fifty to reflect current data.

THE J 'NIFTY-FIFTY' - In our insight posted on July 1st Japan: Most Overbought &amp; Most Oversold - The Relative Price Score, we highlighted the emergence of a momentum-driven concentration in a small number of over-priced growth stocks which we dubbed "Japan's Nifty-Fifty". At that time, this group of stocks - many of which are widely held in foreign investor portfolios - had produced a one-year performance of 60%, substantially outperforming all benchmarks. As we then observed,    

For portfolio managers willing to go along for this ride, the result has been a career-defining period of relative glory while value-orientated peers have suffered another year in the performance 'doghouse’. The last chapter of this tale requires no spoiler alert. Currently, twenty-eight of our fifty have negative of flat earnings momentum and eighteen have seen a decline in Relative Price Score in the last month. We look for further downside ahead in earnings and price momentum.

LAST CHAPTER? - Whether or not we have reached the final chapter of this particular tale, recent months have not been kind to this 'strategy'. The simple average has declined by 20% over both one and three months compared to declines in the market composite of 12% and 10%, respectively. Over one year, the outperformance has declined from 54% to 18%. Certainly, momentum growth stocks have always been a feature of the Japanese market, and many could now well bounce hard with any market recovery. However, when earnings momentum turns down or negative, as it has done recently for ZOZO Inc (3092 JP), Monotaro (3064 JP) and Misumi (9962 JP), the lack of valuation support can result in short, sharp price shocks that can nullify months of relative out-performance in a few trading sessions.
TOO MUCH OF A GOOD THING - As with the US 'FAANGs, in the end, all things must pass. The chart below shows the one-year progression of the 50 companies measured by Relative Price Score which plots the relative performance of all companies on the same scale. The 4.0 'Overbought' line is the first percentile of observations for all currently-listed companies since 1990.

Source: Japan Analytics
THE JULY 2018 'NIFTY-FIFTY' - The July 2018 'portfolio' in the table below has data as of that date. The average one-year performance was +60%, the average Price Score was 4.09 - just above the 'Overbought' line - while the average PER was 60x and PBR 8.43. The average Results Score was 8 out of a maximum of 30 and the average change from the previous quarter was -1. Only three companies, OBIC (4684 JP), Mcdonald's Japan (2702 JP) and Outsourcing (2427 JP), were not 'Fully Priced'.

The J Nifty Fifty - July 2018 companies are presented in descending order of Market Capitalisation. The selection criteria were: market capitalisation higher than ¥183b, Relative Price Score of over 2.5, PE ratio of over 30 and PBR of over 3. "FP" means Fully Priced - a company that ranked in both the top 20% in terms of PER and PBR.  Price Score and Results Score are as defined in earlier insights.
In the next section, we provide an updated performance review of the July selection, as well as updating the Nifty-Fifty to reflect current data.

Japan: The Demise of The "J Nifty-Fifty"?

Management continued to invest in expansion while top line growth slowed, contributing to accelerating profit declines in 2Q, a substantial reduction in full-year FY Mar-19 guidance, and the collapse of the share price. Monthly consolidated sales growth declined from 11.7% year-on-year in July to 1.2% in September, with Factory Automation down from 5.1% to -2.9%, Die Components down from 6.0% to -3.4%, and VONA down from 20.7% to 7.2%. Last April and May, Factory Automation was also growing at rates close to 20%.Consolidated operating profit was down 22.7% year-on-year on a 5.9% increase in sales in the three months to September, compared with a 9.9% decline in operating profit on a 12.7% increase in sales in 1Q. In the Factory Automation segment, sales growth dropped from 16.0% in 1Q to 0.9% in 2Q, while the year-on-year change in operating profit went from 7.3% to -21.5%. VONA operating profit was down 43.1% year-on-year in 2Q, but appears to be stabilizing at about 4% of sales. Die Component profit was also fairly stable.1H operating profit was 20% short of guidance and full-year operating profit guidance was cut by 13%, but this implies a 20% sequential rebound in operating profit in 2H. That, in our estimation, seems unlikely.At ¥2,162 (Monday, October 29 closing price), the shares are down 29% since late September and selling at 24x management's new EPS guidance for FY Mar-19. But sales and profit trends appear to put this estimate at risk. October sales data should be available by November 20.

Management continued to invest in expansion while top line growth slowed, contributing to accelerating profit declines in 2Q, a substantial reduction in full-year FY Mar-19 guidance, and the collapse of the share price. Monthly consolidated sales growth declined from 11.7% year-on-year in July to 1.2% in September, with Factory Automation down from 5.1% to -2.9%, Die Components down from 6.0% to -3.4%, and VONA down from 20.7% to 7.2%. Last April and May, Factory Automation was also growing at rates close to 20%.Consolidated operating profit was down 22.7% year-on-year on a 5.9% increase in sales in the three months to September, compared with a 9.9% decline in operating profit on a 12.7% increase in sales in 1Q. In the Factory Automation segment, sales growth dropped from 16.0% in 1Q to 0.9% in 2Q, while the year-on-year change in operating profit went from 7.3% to -21.5%. VONA operating profit was down 43.1% year-on-year in 2Q, but appears to be stabilizing at about 4% of sales. Die Component profit was also fairly stable.1H operating profit was 20% short of guidance and full-year operating profit guidance was cut by 13%, but this implies a 20% sequential rebound in operating profit in 2H. That, in our estimation, seems unlikely.At ¥2,162 (Monday, October 29 closing price), the shares are down 29% since late September and selling at 24x management's new EPS guidance for FY Mar-19. But sales and profit trends appear to put this estimate at risk. October sales data should be available by November 20. 

Misumi Group (9962 JP): Expansion Plan Undercut by Weak Demand

Thematic (Sector/Industry)

<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/061/034/original/2018-08-16_19-07-34.png?1534672507" class="editor-image img-responsive" data-smartkarma-image-id="61034"></figure><div class="content-caption">Source: Japan Analytics</div>A GOOD QUARTER - The Composite Results Score has now declined for seven months in a row and is implying a slowing of the upward momentum in earnings.  However, the score has only declined by 31 basis points since last quarter showing a degree of 'stability' seen only in 2011 in recent years.  The aggregate Forecast/Revision score has also continued to decline and is now lower for the fourth straight month. As would be expected, this score is a reliable leading indicator for the Results Score and suggests further weakening in the rate of earnings growth in the months ahead.  Neither score is, as yet, suggesting a decline in earnings before the end of the fiscal year.YEN CORRELATION WEAKENING - This quarter's earnings' stability was surprising given the relative strength of the Yen compared to a year ago. In the past and even as recently as 2016, a 5 per cent year-on-year decline has resulted in negative Results Scores. The year-on-year change in now positive so any negative impact will dissipate over the next two quarters.MARKET FOLLOWS MOMENTUM LOWER - The All Market Composite peaked on 23rd January and has since fallen by 11% despite a continuation of the Bank of Japan's ETF purchasing programme. Weakening earnings momentum and the overvaluation of many of the leading stocks, as in our '<a href="https://www.smartkarma.com/insights/japan-most-overbought-most-oversold-the-relative-price-score" target="_blank" data-smartkarma-citation="insights:21149">Nifty 50</a>' portfolio, have been contributing factors. With prospects for a much weaker Yen limited by the current trade negotiations between Japan and the United States, and with global growth slowing, we expect both Results and Revision Scores to trend lower, but to end the fiscal year in positive territory. Historically, the market has not risen during periods when both the Results and Forecast/Revision Scores have been trending down.<div class="content-highlight">MARKET RECOMMENDATION - Within a global portfolio, we would market-weight Japanese equities with a bias towards domestic sectors and not hedge the currency exposure.</div>SECTOR RESULTS SCORES -The good news is that only one sector, (Multi-Industry - 75% of which is <a href="https://www.smartkarma.com/entities/359" target="_blank" data-smartkarma-citation="entities:359:1">Japan Post [6178 JP</a>]) has a negative score - and its score is less negative than last quarter. Both the Media and Consumer Services sectors' scores turned positive and each increased by more than two points.  On the other hand, over half of our 29 sectors saw declining scores, although the number was lower than last quarter.  The top sectors in terms of quarter-on-quarter change were Energy, Consumer Services, Media, Information Technology and Other Commercial Products while the laggards were Non-Bank Finance, Chemicals, Construction, Machinery and Utilities. SECTOR REVISION SCORES - Five sectors have negative Forecast/Revision Scores with Utilities now joining Media, Multi-Industry, Autos and Banks from last quarter. The highest scores are in the Energy, Technology Hardware, Electrical Equipment, Retail and Information Technology sectors. Improvements of greater than one point were seen in Energy, Media and Machinery while Food, Beverages &amp; Tobacco, Chemicals, Utilities, Other Materials and Technology Hardware all lost more than one point. Overall eighteen sectors saw declines.REVISION V. RESULTS SCORES - The difference between the Results and Revision Scores is a good indicator of corporate expectations compared with the trailing-twelve-month reality. In some cases (e.g. Restaurants) the 'optimism' is due to a failure to revise forecasts in the light of weaker results. In others, such as Telecommunications, there is scope for upward revisions in the coming quarters.<div class="content-highlight">
THE OPTIMISTS
Restaurants • Other Materials • Electrical Equipment • Technology Hardware • Retail
THE PESSIMISTS
Banks • Autos • Telecommunications • Utilities • Media • Chemicals
</div>SECTOR PERFORMANCE - Over the last three months, our Japan Market Composite declined by 5.8%. Only four sectors saw an increase in value led by Telecommunications, Energy, Commercial Services and Information Technology. The largest declines were in the Building Materials, Metals, Real Estate Construction and Machinery sectors. Nine sectors are now negative over one year led by Building Materials, Metals and Food, Beverages &amp; Tobacco and only eight are up in double-digits led by Services and Information Technology. For the time being, Domestic Non-Manufacturing sectors 'rules the roost' and Domestic Cyclical sectors have taken over from Global Cyclicals in the 'doghouse'.'.<div class="content-highlight">
SECTOR RECOMMENDATIONS
Our most-preferred sectors are currently Energy, Healthcare, Telecommunications, Other Commercial Products and Information Technology.
Least-preferred sectors are Metals, Chemicals, Machinery, Autos, Construction, Real Estate, Building Materials, Food Beverages &amp; Tobacco and Utilities.
</div>TOP 5 LARGER PEER GROUPS - The top five Peer Groups capitalised at over ¥1 trillion are Machine Tools &amp; Presses, PC &amp; Computer Peripherals, Oil &amp; Gas Refining &amp; Marketing, Telecom Distribution Services and Sporting &amp; Outdoor Goods. The top twenty larger Peer Groups have gained 16% over one year but have declined by 4% on average the last three months.BOTTOM 5 LARGER PEER GROUPS - The bottom five Peer Groups capitalised at over ¥1 trillion are Audio/Visual Content, LCD/LED Materials &amp; Equipment, Electrical Engineering, General Contractors and Real Estate - Leasing. The bottom twenty larger Peer Groups have lost 2% over one year and 9% over the last three months. Only Security Services and Tobacco have risen since May.<figure class="editor-figure mceNonEditable"><img src="https://static-prod.smartkarma.com/images/media/000/061/038/original/2018-08-19_19-33-03.png?1534674804" class="editor-image img-responsive" data-smartkarma-image-id="61038"></figure>

Source: Japan AnalyticsA GOOD QUARTER - The Composite Results Score has now declined for seven months in a row and is implying a slowing of the upward momentum in earnings.  However, the score has only declined by 31 basis points since last quarter showing a degree of 'stability' seen only in 2011 in recent years.  The aggregate Forecast/Revision score has also continued to decline and is now lower for the fourth straight month. As would be expected, this score is a reliable leading indicator for the Results Score and suggests further weakening in the rate of earnings growth in the months ahead.  Neither score is, as yet, suggesting a decline in earnings before the end of the fiscal year.YEN CORRELATION WEAKENING - This quarter's earnings' stability was surprising given the relative strength of the Yen compared to a year ago. In the past and even as recently as 2016, a 5 per cent year-on-year decline has resulted in negative Results Scores. The year-on-year change in now positive so any negative impact will dissipate over the next two quarters.MARKET FOLLOWS MOMENTUM LOWER - The All Market Composite peaked on 23rd January and has since fallen by 11% despite a continuation of the Bank of Japan's ETF purchasing programme. Weakening earnings momentum and the overvaluation of many of the leading stocks, as in our 'Nifty 50' portfolio, have been contributing factors. With prospects for a much weaker Yen limited by the current trade negotiations between Japan and the United States, and with global growth slowing, we expect both Results and Revision Scores to trend lower, but to end the fiscal year in positive territory. Historically, the market has not risen during periods when both the Results and Forecast/Revision Scores have been trending down.MARKET RECOMMENDATION - Within a global portfolio, we would market-weight Japanese equities with a bias towards domestic sectors and not hedge the currency exposure.SECTOR RESULTS SCORES -The good news is that only one sector, (Multi-Industry - 75% of which is Japan Post [6178 JP]) has a negative score - and its score is less negative than last quarter. Both the Media and Consumer Services sectors' scores turned positive and each increased by more than two points.  On the other hand, over half of our 29 sectors saw declining scores, although the number was lower than last quarter.  The top sectors in terms of quarter-on-quarter change were Energy, Consumer Services, Media, Information Technology and Other Commercial Products while the laggards were Non-Bank Finance, Chemicals, Construction, Machinery and Utilities. SECTOR REVISION SCORES - Five sectors have negative Forecast/Revision Scores with Utilities now joining Media, Multi-Industry, Autos and Banks from last quarter. The highest scores are in the Energy, Technology Hardware, Electrical Equipment, Retail and Information Technology sectors. Improvements of greater than one point were seen in Energy, Media and Machinery while Food, Beverages &amp; Tobacco, Chemicals, Utilities, Other Materials and Technology Hardware all lost more than one point. Overall eighteen sectors saw declines.REVISION V. RESULTS SCORES - The difference between the Results and Revision Scores is a good indicator of corporate expectations compared with the trailing-twelve-month reality. In some cases (e.g. Restaurants) the 'optimism' is due to a failure to revise forecasts in the light of weaker results. In others, such as Telecommunications, there is scope for upward revisions in the coming quarters.
THE OPTIMISTS
Restaurants • Other Materials • Electrical Equipment • Technology Hardware • Retail
THE PESSIMISTS
Banks • Autos • Telecommunications • Utilities • Media • Chemicals
SECTOR PERFORMANCE - Over the last three months, our Japan Market Composite declined by 5.8%. Only four sectors saw an increase in value led by Telecommunications, Energy, Commercial Services and Information Technology. The largest declines were in the Building Materials, Metals, Real Estate Construction and Machinery sectors. Nine sectors are now negative over one year led by Building Materials, Metals and Food, Beverages &amp; Tobacco and only eight are up in double-digits led by Services and Information Technology. For the time being, Domestic Non-Manufacturing sectors 'rules the roost' and Domestic Cyclical sectors have taken over from Global Cyclicals in the 'doghouse'.'.
SECTOR RECOMMENDATIONS
Our most-preferred sectors are currently Energy, Healthcare, Telecommunications, Other Commercial Products and Information Technology.
Least-preferred sectors are Metals, Chemicals, Machinery, Autos, Construction, Real Estate, Building Materials, Food Beverages &amp; Tobacco and Utilities.
TOP 5 LARGER PEER GROUPS - The top five Peer Groups capitalised at over ¥1 trillion are Machine Tools &amp; Presses, PC &amp; Computer Peripherals, Oil &amp; Gas Refining &amp; Marketing, Telecom Distribution Services and Sporting &amp; Outdoor Goods. The top twenty larger Peer Groups have gained 16% over one year but have declined by 4% on average the last three months.BOTTOM 5 LARGER PEER GROUPS - The bottom five Peer Groups capitalised at over ¥1 trillion are Audio/Visual Content, LCD/LED Materials &amp; Equipment, Electrical Engineering, General Contractors and Real Estate - Leasing. The bottom twenty larger Peer Groups have lost 2% over one year and 9% over the last three months. Only Security Services and Tobacco have risen since May.

Japan: Results & Revision Scores Summer 2018 Update - Market Composite, Sectors & Peer Groups

<ul>
<li>VONA sales were up 19.0% year-on-year in the three months to June, but the segment's operating profit dropped by 49.2% due to the cost of overseas expansion. This led to a 9.9% decline in total consolidated operating profit and a 5.0% decline in net profit.</li>
<li>Misumi's e-commerce MRO business continues to lag that of MonotaRO (3064 JP). </li>
<li>Factory Automation segment profit was up 7.3%, but on a 16.0% increase in sales. Die Components profit was up  3.1% on a 1.1% decline in sales.</li>
<li>Guidance, which is…</li>
</ul>


VONA sales were up 19.0% year-on-year in the three months to June, but the segment's operating profit dropped by 49.2% due to the cost of overseas expansion. This led to a 9.9% decline in total consolidated operating profit and a 5.0% decline in net profit.
Misumi's e-commerce MRO business continues to lag that of MonotaRO (3064 JP). 
Factory Automation segment profit was up 7.3%, but on a 16.0% increase in sales. Die Components profit was up  3.1% on a 1.1% decline in sales.
Guidance, which is…


Misumi Group (9962 JP): VONA Drags Down Profits

Japan

MISUMI Group Inc. distributes precision machinery parts by mail order. The products include a variety of components such as press die, plastic mold, automated machinery, pc & network, and wiring.  The Company also sells supplies for factories, hospitals, and restaurants and semi-conductors by mail order.

Price Gauge
52-week Range	0.00 - 0.00
Market Cap (USDm)	0.00
P/E	0.00
Dividend (Yield)	0.00

Misumi Group (9962 JP)

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