Tokyo Lifestyle Co., Ltd. Q4 FY2024 earnings call

• Achieved success in newly-launched luxury products and expansion in key markets like Japan, Hong Kong, US, and Canada.
• Strategic expansion into North America with new subsidiaries and stores contributed to revenue growth.
• Strengthened wholesale and franchise store network to mitigate online sales volatility.
• Intend to open 10 additional directly operated physical stores in Hong Kong and 50 new franchise stores in various regions over the next three years.
• Strive to improve profitability by saving operating expenditure and transforming some directly operated physical stores into franchise stores.
• Continue expanding product offering by cooperating with beauty products and other suppliers to develop new private label products.

In fiscal year 2024, total revenue surged by 50.3% to $195.7 million. Revenue from directly operated physical stores was up by 28.8% to $15 million. Revenue from franchise stores and wholesale customers was up by 23.7% to $117 million. Gross profit was $23.4 million with a gross margin of 11.9%. Operating expenses were down by 38.4% to $17.6 million. Net income increased to $7.5 million from a net loss of $8 million in fiscal year 2023. Basic and diluted earnings per share was $0.2 compared to a loss per share of $0.22 in fiscal year 2023.

• Intend to open 10 directly operated physical stores in Hong Kong and 50 franchise stores in the U.S., Canada, Australia, New Zealand, the UK, Singapore, Malaysia, Thailand, and Taiwan over the next three years.
• Strive to improve profitability through cost savings and transforming directly operated stores to franchises.
• Continue expanding product offering by collaborating with suppliers for private label products.

• Forward-looking statements involve known and unknown risks and uncertainties.
• Decline in demand for Japanese beauty products in the China market affected sales of beauty products to wholesale customers.