4926.T

• Mid-term Strategic Execution

  • Seaborn is in the third year of its 2024.3 - 2026.3 mid-term management plan, focusing on completing three core priorities: improving product value, improving salon value, and creating new value.
  • In the first half of the fiscal year, management prioritized three key initiatives: expanding touchpoints with new customers, upskilling employees to improve customer satisfaction, and executing strategic store renovations centered in the Tokyo metropolitan area.

• New Customer Acquisition

  • Added a shorter-length trial menu to accommodate time-constrained business customers, which increased trial bookings from this segment. Strengthened online and SNS advertising, leading to growing web-driven trial plan traffic.
  • Refreshed event booths and event staff uniforms, which improved staff motivation and increased event attendance. Increasing frequency of corporate beauty seminars as part of corporate welfare programs also expanded new customer touchpoints.
  • These efforts delivered 110.9% YoY growth in new visitor numbers and 120.6% YoY growth in new customer revenue.

• Employee Upskilling and Customer Satisfaction

  • Strengthened role-specific training for store managers, new hires, and skin counselors, including sharing on-site success, failure, and customer experience stories to improve staff performance. Expanded e-learning for flexible, repeat self-study.
  • Results: YoY repeat customer volume was 99.6% (flat) due to ongoing staff shortages, but repeat revenue hit 105.4% YoY thanks to rising average repeat purchase prices driven by improved staff skill. Royal member count currently stands at 11,730 people, on track to hit the 12,000 end-of-period target.
  • Planned next steps: Host factory visits and events for royal customers, and hold the 60th anniversary edition of Beauty Award 2025 (its long-running core industry/community event) with media invites to raise broader awareness.

• Strategic Store Renovation

  • Renovated 1 large, 3 medium, and 2 small stores focused on the Tokyo metropolitan area in H1, bringing cumulative renovations to 7 large, 11 medium, and 6 small stores to date.
  • One-year post-renovation sales are 109% of pre-renovation sales for large stores, 107% for medium stores, and 102% for small stores, proving renovations drive new and existing customer growth. Two additional large stores (Yokohama and Jiyugaoka) were already renovated in October and November H2 as planned.

• 60th Anniversary Branding

  • Seaborn entered phase 3 of its 60th anniversary branding project, with a finalized theme, logo, key color, and brand message: "Creating beauty together with customers", which expresses gratitude for its history and commitment to future customer partnership.
  • 60th anniversary commemorative products launched in October have already sold out from high customer demand. Promotional activities will center on four pillars: event promotion, SNS promotion, Beauty Award 2025, and concept pop-ups, with goals to expand new customer touchpoints and drive both salon and EC traffic. New initiatives include magazine partner collaborations for targeted outreach and the company's first-ever consumer sampling campaign.

• R&D Strategy

  • Seaborn's R&D mission is to "science skin and mind to deliver peace of mind and relaxation," focusing on addressing how psychological stress accelerates skin aging. It differentiates itself by combining stress-relieving facial treatment services with skincare products developed around mind-skin connection research, branded as "Kyoso (co-harmony) Beauty" which encompasses home + salon care co-harmony, customer + esthetician co-harmony, and skin-mind-body co-harmony.
  • Key research achievements: Confirmed that Seaborn's facial treatment increases blood oxytocin (the "happiness hormone") and raises blood flow in the left prefrontal cortex, which improves positive mood and skin health; discovered that stress hormone adrenaline increases NGF (a driver of atopic dermatitis, itching, and skin barrier damage) and developed a world-first proprietary ingredient to suppress stress-related skin damage; recently published research showing stress reduces hyaluronic acid levels while increased oxytocin raises hyaluronic acid levels; discovered that Seaborn's core product Treatment Mase changes to a lamellar structure during use, which improves massage performance and skin benefits, a very rare formulation trait among commercial cleansers.
  • R&D uses a customer co-creation model: The proprietary EPISCAN skin analysis system has accumulated over 650,000 skin data points, and the company collects 180,000 customer responses annually to inform product development and personalized recommendations.

• Sustainability

  • Donated artwork to Tochigi Prefecture (home to its production and R&D centers) via corporate hometown tax. Held family workshops for employees' children. Continued participation as a board member of the Cosme Bank Project to support single mothers via cosmetic donations.

• Full-year FY2026 March Term financial guidance is maintained unchanged from original plans: total consolidated sales of 9.123 billion yen, operating profit of 201 million yen, and an operating profit margin of 2.7%.
• Shareholder returns are maintained per original policy: an intermediate dividend of 10 yen per share has already been paid, and a year-end dividend of 10 yen per share remains planned.

All sales are broken down by sales channel (product/operational segment for Seaborn):

1. Direct stores: 4.306 billion yen in revenue, accounting for 93.4% of total consolidated revenue; growth was driven by increased new customer footfall and rising average purchase value for both new and existing customers.
2. Mail order/online sales: 136 million yen in revenue, accounting for 2.95% of total consolidated revenue.
3. Domestic agencies: 90 million yen in revenue, accounting for 1.95% of total consolidated revenue.
4. Overseas agencies: 10 million yen in revenue, accounting for 0.22% of total consolidated revenue.
5. Other (including subsidiaries): 66 million yen in revenue, accounting for 1.43% of total consolidated revenue. Subsidiary Jafmac saw recovering sales driven by new fermented beverage product launches and strengthened promotional activities.

• Ongoing staff shortages persist, which has kept repeat customer volume flat relative to last year despite rising revenue from higher average purchase values.

No question and answer section was included in the provided earnings call transcript.