Yonex Co., Ltd. reported fiscal 2023 global net sales increased 43.7 percent year-over-year to ¥107.0 billion ($806.0 million), reflecting strong demand in all regions despite concerns over inflation, economic slowdown and geopolitical risks. Yen depreciation contributed to sales increases in overseas subsidiaries, which also increased in local currency terms.

  • Badminton, which represented 61.0 percent of sales at Yonex for the year, grew 50.8 percent to ¥65.3 billion ($499.3 million) in fiscal 2023.
  • Tennis, which comprised 16.3 percent of sales, increased 52.2 percent year-over-year to ¥17.5 billion ($133.8 million) for the fiscal 2023.
  • Golf only delivered 1.9 percent of sales for the year but grew 32.2 percent to ¥2.0 billion ($15.3 million) in the fiscal year.
  • The Others category, which includes Apparel and Accessories, comprised 20.3 percent of total sales in fiscal 2023. Net sales grew 22.6 percent to ¥21.7 billion ($165.9 million) in fiscal 2023.

The Japan region net sales were up 27.3 percent in yen terms year-over-year to ¥47.8 billion ($365.1 million) in fiscal 2023 and rose 22.4 percent in local currency terms. Demand from club activities recovered in badminton and soft tennis, and tennis sales, especially for racquets, reportedly continued to increase. Sales of racquets, shoes and apparel increased in each sport due to strong sales of new products. Sales to overseas distributors increased as sports activities fully resumed. The resumption of international badminton tournaments and “remarkable results” of Yonex-sponsored athletes also led to significant sales growth.

The Asia region’s net sales increased 60.4 percent in fiscal 2023 to ¥49.7 billion ($379.7 million) in yen terms and increased 37.5 percent in local currency terms. In China, interest in participating in sports and the popularity of badminton remained strong from the last fiscal year. Implementation of product trial events and competitions led to expanding the player base. COVID-19 outbreaks occurred in April/May (2Q) and December (4Q) 2022, but its impacts were limited. Yen depreciation also contributed to sales growth. Taiwan sales grew due to strong popularity of badminton on the back of the resumption of domestic tournaments and strong performances of local athletes in international competitions held in Taiwan.

North America’s net sales surged 64.6 percent to ¥5.3 billion ($40.2 million) in fiscal 2023 and grew 36.9 percent in local currency terms. The company said badminton sales grew due to the reopening of sports facilities and the restart of sports club activities. Tennis sales remained strong, although the growth rate weakened slightly from the prior fiscal year due to industry-wide inventory increases. Yen depreciation also contributed to sales growth.

Europe had the second-highest growth in yen terms as net sales increased 63.3 percent to ¥3.8 billion ($29.2 million). In local currency terms, net sales grew 53.1 percent for the fiscal year.

The Sports Facilities division, located solely in Japan, saw net sales improve 13.7 percent to ¥533 million ($0.4 million) in fiscal 2023.

Consolidated gross profit was up 37.5 percent for the year to ¥45.9 billion ($345.7 million), while gross margins slipped 190 basis points to 42.9 percent of sales.

Total SG&A expenses increased 34.5 percent to ¥35.8 billion ($270.0 million) as Yonex “stepped up” marketing activities.

The resulting consolidated operating profit increased by 49.3 percent year-over-year in yen terms to ¥10.1 billion ($75.8 million) in the 12-month period ended March 31, 2023. The company said the record-high profit was due to higher sales and a subsequent increase in gross profit, which offset the negative impacts of raw material price hikes and higher purchasing costs caused by yen depreciation. 

Japan region’s operating profit dipped 1.1 percent to ¥1.5 billion ($11.3 million). Gross margin was lower due to raw material price hikes and higher costs of imports caused by yen depreciation. Higher SG&A expenses, including advertising and personnel expenses, also contributed to the lower profit.

Asia region’s operating profit grew 77.2 percent to ¥8.8 billion ($67.4 million) in fiscal 2023. Region SG&A increased due to higher advertising expenses for marketing investments in China. The higher gross profit accompanying sales growth contributed significantly to operating profit growth.

North America’s region operating profit increased 54.3 percent in yen terms to ¥423 million ($3.2 million). An increase in gross profit due to higher sales offset the increase in SGA, including advertising and personnel expenses.

Ordinary profit was up 37.5 percent for the year to ¥10.0 billion ($75.0 million). Net profit was up 26.8 percent year-over-year to ¥7.3 billion ($55.2 million). Earnings per share increased 27.1 percent to 84.05 yen for fiscal 2023. Inventory increased nearly 60 percent at fiscal year-end to ¥18.8 billion.

Looking ahead, Yonex expects to maintain moderate growth in fiscal 2024, but gains are expected to be lower than the growth seen in fiscal 2023. The company expects to “invest aggressively” in marketing and human resources to build the foundations to achieve mid- to long-term growth.

The company sees fiscal 2024 first-half net sales reaching ¥57.0 billion, representing 13.8 percent growth for the period. Operating income is expected to decline 12.9 percent in the first half to ¥6.2 billion, or 10.9 percent of revenues. Net profit is forecasted to reach ¥4.4 billion in the fiscal first half, a 21.4 percent decline from the fiscal 2023 first half.

Full-year fiscal 2024 net sales are expected to rise 8.4 percent to ¥116.0 billion. Operating income is seen performing well in H2, driving full-year operating income up 6.3 percent for the year to ¥10.7 billion, or 9.2 percent of revenues. Net income is forecasted at ¥7.8 billion for the full year, a 6.4 percent increase over fiscal 2023 results.

Photo courtesy Yonex