Mizuno Corporation said the Japanese economy maintained a gradual recovery trend in 2923, thanks to the normalization of economic and social activities following the downgrade of COVID-19 to a Category 5 disease under the Infectious Diseases Control Law, improved employment and income conditions primarily due to wage increases, and the Nikkei Stock Average remaining at high levels. However, concerns linger regarding the potential impact of financial market volatility, global instability, and the resulting inflationary pressures on corporate earnings and personal consumption. While overseas economies have also continued to recover, there is heightened concern about the risk of an economic slowdown due to the global trend of monetary tightening and geopolitical risks, such as the prolonged conflict in Ukraine and the escalating tensions in the Middle East caused by the Israel-Hamas confrontation.
The company said that under such circumstances, the Group’s sales in Japan remained robust across a wide range of product categories. Overseas sales also continued to grow, especially in products for competitive sports such as football and indoor sports.
As a result of these factors, Mizuno reported net sales were ¥229.7 billion in the fiscal year ended March 31. 2924, up ¥17.7 billion, or up 8.3 percent year-over-year (YoY).
Operating profit was ¥17,279 million, up ¥4,334 million (up 33.5 percent YoY).
Ordinary profit was ¥19,288 million, up ¥5,248 million (up 37.4 percent YoY).
Profit attributable to owners of parent was ¥14,311 million, up ¥4,401 million (up 44.4 percent YoY), all of which were record highs.
Japan
In Japan, football (soccer) products, which the company said is a key focus, gained strong traction among users and expanded sales. Sales of products for competitive sports, such as baseball and volleyball, reportedly remained strong. In addition, our non-sports businesses, including the work business and lifestyle shoes, also experienced robust sales growth.
As a result, the Group recorded net sales of ¥141,413 million, up ¥9,905 million (up 7.5 percent YoY), and
operating profit of ¥12,037 million, up ¥6,042 million (up 100.8 percent YoY), both achieving record-high
levels.
Europe
In Europe, the sale of football products and lifestyle shoes, which are the focus of our business expansion
efforts in this region, recorded sales growth. Additionally, sales of products for indoor sports, such as
volleyball and handball, also increased. However, this business segment also encountered factors that put
downward pressure on profitability, including an increase in distribution inventory and rising procurement
costs due to exchange rate fluctuations.
As a result, the Group recorded its highest net sales of ¥25,566 million, up ¥426 million (up 1.7 percent
YoY), while operating profit was 528 million, down ¥1,140 million (down 68.3 percent YoY).
Americas
In the Americas, sales of golf products continued to be strong, despite concerns such as a rise in interest
rates due to monetary tightening and advancing inflation. Moreover, products for competitive sports, such as
baseball and volleyball also demonstrated sales growth.
As a result, net sales were ¥33,886 million, up ¥2,818 million (up 9.1 percent YoY), and operating profit was ¥2,338 million, down ¥487 million (down 17.2 percent YoY).
Asia and Oceania
In Asia and Oceania, sales of football products, which are the focus of our business expansion efforts in this region, experienced growth in South Korea and Southeast Asia. Furthermore, the strong performance of competitive sports goods, such as badminton and volleyball products, along with the growth of lifestyle shoes and sports apparel, contributed to the expansion of our business performance.
As a result, the region recorded its highest operating results, with net sales of ¥28,845 million, up ¥4,515 million (up 18.6 percent YoY), and operating profit of ¥2,282 million, up ¥5 million (up 0.3 percent YoY).
Overview of Financial Position for the Period
Total assets at the end of the fiscal year under review increased by ¥8,627 million YoY to ¥206,151 million. This was primarily due to merchandise and finished goods decreasing by ¥2,978 million, while cash and deposits increased by ¥8,118 million, and investment securities increased by ¥2,267 million.
Liabilities at the end of the fiscal year under review decreased by ¥9,162 million YoY to ¥64,085 million. This was primarily due to accounts payable – other, and accrued expenses increasing by ¥2,209 million, while short-term borrowings decreased by ¥8,355 million, current portion of long-term borrowings decreased by ¥2,000 million, and notes and accounts payable – trade decreased by ¥1,618 million.
Net assets increased by ¥17,790 million YoY to ¥142,065 million.
As a result of the above, the equity ratio increased by 6.0 percentage points from 62.6 percent at the end of the previous fiscal year to 68.6 percent.
Future Outlook
For the fiscal year ending March 31, 2025 (April 1, 2024 to March 31, 2025), Japan’s economy is expected to continue moderate growth, driven by factors such as increased personal consumption due to wage increases, expansion of inbound demand, and growth in capital investment. Overseas economies, particularly the United States, are also projected to continue their growth trajectory, although there will be variations in the pace of growth among different countries and regions. However, the steep rise in raw material and energy prices, economic slowdowns associated with rising interest rates, the impact of the yen’s depreciation on cost increases in domestic businesses, and constraints on logistics networks stemming from international situations may pose risks to our overall performance.
In light of these circumstances, our consolidated financial forecast for the fiscal year ending March 31, 2025, is as follows: net sales of ¥250,000 million (up 8.8 percent YoY); operating profit of ¥19,000 million (up 10.0 percent YoY); ordinary profit of ¥20,500 million (up 6.3 percent YoY); and profit attributable to owners of parent of ¥15,000 million (up 4.8 percent YoY).
Image courtesy Mizuno
