TOKYO, Dec 5, 2014 - (ACN Newswire) - H.I.S. Co., Ltd. (TSE1: 9603), a leading travel and airline ticket agency, has announced results for the full year ended October 31, 2014. The Group achieved record results for the fourth consecutive year with consolidated net sales of 523,246 million yen, an increase of 9.1% compared with the previous fiscal year; an operating income of 15,906 million yen, an increase of 34.3% compared with the previous fiscal year; and an ordinary income of 19,016 million yen, an increase of 25.1% compared with the previous fiscal year. Net income was 9,050 million yen, an increase of 1.6% from a year earlier.
Consolidated Financial Results for the Full Year Ended October 31, 2014
Consolidated Operating Results (millions of yen)
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Full year ended October 31, 2014 % 2013 %
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Net Sales 523,246 9.1 479,478 11.1
Operating Income 15,906 34.3 11,843 4.7
Ordinary Income 19,016 25.1 15,203 12.8
Net Income 9,050 1.6 8,903 (4.6)
Net Income per Share (yen) 139.56 137.30
Net Income per Share, Diluted (yen) 137.61 --
Return on Equity (ROE) 10.8 12.1
Ordinary Income to Total Assets Ratio 7.6 7.8
Operating Income to Net Sales Ratio 3.0 2.5
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Consolidated Financial Position
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As of October 31, 2014 2013
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Total Assets 281,332 215,913
Net Assets 102,295 90,680
Shareholders' Equity Ratio (%) 31.5 36.6
Net Assets per Share (yen) 1,366.04 1,219.42
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Consolidated Cash Flows
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Full year ended October 31, 2014 2013
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Cash Flows from Operating Activities 23,701 15,360
Cash Flows from Investing Activities (12,703) (10,975)
Cash Flows from Financing Activities 37,033 16,817
Cash and Cash Equivalents at Year End 110,145 61,426
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Dividends (yen)
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Year Ended 2015 (Forecast) 2014
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22.00 18.00
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Forecasts for the Next Fiscal Year
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Interim % Full year %
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Net Sales 278,300 10.2 579,700 10.8
Operating Income 10,200 21.7 19,400 22.0
Ordinary Income 11,100 15.1 21,400 12.5
Net Income 5,000 14.7 10,600 17.1
Net Income per Share (yen) 77.10 163.46
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Note:
The Group conducted a 1:2 stock split on its common shares with the effective date of May 1, 2014. Net Income per Share and Net Assets per Share are calculated under the assumption that the stock split had been conducted at the beginning of the previous fiscal year ended October 31, 2013. The dividend forecast reflects the stock split.
During the fiscal year under review, demand for overseas travel departing Japan remained firm overall, with an expansion of international flights at Haneda Airport in Tokyo acting as a positive factor, despite concerns about the international situation and outbreaks of infectious diseases. In domestic travel, demand for leisure travel continued strong with the background of sufficient travel materials, including LCC route expansion and World heritage sites. Turning to foreign travelers visiting Japan, demand expanded with loosened visa requirements for travelers from Southeast Asian countries, and a sense of undervalue resulting from the weak yen trend. Additionally, the number of travelers from China significantly recovered. According to the Japan National Tourist Organization (JNTO), the estimated number of foreign travelers visiting Japan for the 10 months from January 2014 through October 2014 is forecast to break the record set in 2013.
Under these business conditions, the Group continues to stand on the concept of 'security' and 'safety', and strives to improve on its standards of 'service' and 'quality' in order to further gain support from our customers, and has therefore implemented a range of original measures to expand its business globally.
- Travel Business
As of the end of October 2014, the Group has a network of sales domestically in 296 branches (an increase of 22 branches from the previous fiscal year) and globally in 60 countries, 124 cities and 180 branches (an increase of 22 branches from the previous fiscal year), and continues to expand towards the goal of 1,000 branches worldwide.
In overseas travel departing Japan, the Group has taken advantage of its overseas branch network and implemented original measures, including proposals of new travel destinations such as Morocco; deployment of high value-added products such as chartered plans to enjoy popular destinations; the launch of "travel concierge", which provides personal assistance in the field; and the development of the original package "Starry sky BBQ at Hilton" which charters the hotel pool side in Hawaii and offers a barbecue or a range of entertainment.
As for sales channels, the Group launched a new "Osaka Station Hawaii branch", a specialty outlet for Hawaii, and began delivering highly-professional services, as well as opening sales branches in shopping malls with emphasis on production efficiency. As for initiatives in the area of online sales, we enabled simultaneous reservation for optional tours on our "air ticket and hotel" website. We also launched customer services by use of SNS including LINE, and strived to further improve convenience by making full use of evolving IT technology.
Our group travel activity was strong due to the increase in orders for large scale group travel, including hosting of now a regular Honolulu Road Race, overseas concert tours, and corporate incentive travels; and educational trips in each region. Our corporate travel, or business travel, was strong as well, delivering global support by taking advantage of our overseas branches.
In the domestic travel business, we continue to commit on "landing-based business" which allows us to promptly provide our customers with new information and products, only available locally. In Okinawa, we offered original products and services, including a dedicated shuttle bus and a deserted island experience. Additionally, we have extended our popular bus tours with new arrival and departure stops in Chiba, Kanagawa and Saitama prefectures among others, as well as expanding sales channels at all branches, as was previously at specialist branches in Japan. As a result of these measures, the Group continues to grow at the level exceeding that of the market in the volume of travel by major travel agencies, compiled by the Tourism Authority a year earlier.
As for foreign travelers visiting Japan, we enhanced collaboration with overseas branches in terms of product development and transmitting visitors, e.g. in receiving an increasing number of travelers from Southeast Asian countries with loosened visa requirements, including Thailand and Indonesia, and travelers from Australia for the purpose of skiing. For the Chinese market which renewed the record high in the number of travelers visiting Japan, we worked to enhance our system in receiving travelers by creating routes other than "Golden Route" and providing airport shuttle buses in order to meet varying needs.
Turning to business overseas, we have promoted operations in multi branches mainly in Southeast Asia, and increased the number of branches to 22 in Thailand, 14 in Indonesia, and 9 in Vietnam. We will further strengthen our promotional activities for local customers and raise our brand recognition. Moreover, we connected our domestic reservation website "Sumayado" with "hisgo", an online reservation website, operating in 39 countries, and strengthened our effort to promote visitors to Japan both domestically and overseas. In our inbound travel business including overseas arrangements, we are acting as wholesalers to other travel agencies, so that we can offer them the services and facilities of overseas branches, and thus strived to enhance synergistic effect through collaboration between overseas and Japanese branches in each business.
As a result of these measures, the travel business for the current fiscal year recorded net sales of 468,551 million yen, an increase of 8.6% compared with the previous fiscal year. This contributed to an increase in our share in the volume of travel by major travel agencies, compiled by the Tourism Authority. The Group recorded an operating income of 10,309 million yen, an increase of 29.6% compared with the previous fiscal year, and achieved the increases both in sales and profit.
- Theme Park Business
HUIS TEN BOSCH Co. Ltd. continues to focus on the implementation of events which are intended to appeal the attraction of the theme park and improve customer satisfaction. From a day to night, various events contributed to an increase in number of visitors, such as the "Kingdom of Flowers" including the "Tulip Festival", for which 650 varieties of tulips were planted, the most seen in Japan; the "The Kingdom of Light Series", an extravaganza of over 10 million bulbs; "The Kingdom of Music and Show" which takes place throughout the park; and the "Fireworks" in each season. In summer, such events as "The Kingdom of Game" for families and the renewal of "Fuwafuwa Land" for children at Adventure Park have been well received, beating our performance in the previous year. Moreover, we implemented "Osaka Castle 3D Mapping Super Illumination", the first measure taking place outside of the theme park, which was also very well received.
As a result, the Group recorded net sales of 26,233 million yen, an increase of 27.7% compared with the previous fiscal year; and an operating income of 7,718 million yen, an increase of 53.9% compared with the previous fiscal year. Starting from August 1, 2014, LAGUNA TEN BOSCH succeeded and operates three "LAGUNA GAMAGORI" businesses in Gamagori, Aichi prefecture.
- Hotel Business
The Group strived to deploy the original value-added services and improve customer satisfaction. For instance, at the Guam Reef & Olive Spa Resort, we opened a private beach; and in the Watermark Hotel Nagasaki, we enhanced popular travel packages which come with souvenirs unique to Hokkaido. Consequently, the Group achieved a surplus, with net sales of 5,413 million yen, an increase of 20.9% compared with the previous fiscal year and an operating income of 260 million yen, compared with an operating loss of 118 million yen a year earlier. The Group also plans to open a new hotel in Bali, Indonesia in the summer of 2015.
- Transportation Business
ASIA ATLANTIC AIRLINES CO., LTD., an international charter carrier, began operation on a route from Suvarnabhumi Airport, Bangkok to Narita International Airport in August, 2013, and launched a direct flight to Cambodia during the Golden week this year. Despite our effort to improve safety and on-time performance, the prolonged political unrest in Thailand hurt our business and the Group recorded net sales of 3,255 million yen, and an operating loss of 1,792 million yen, compared with an operating loss of 1,065 million yen a year earlier.
- Kyushu Sanko Group
KYUSHU INDUSTRIAL TRANSPORTATION Group worked to provide customer orientated services and dedicate to the regional development, by implementing a new vehicle complete with safety equipment in response to a new eco-friendly emission standard, and launching a multi-display "Aso Super Ring" facility, in conjunction with the largest topographical model in Japan. As a result, the Group recorded net sales of 25,175 million yen, a decrease of 0.4% compared with the previous fiscal year and an operating income of 1,259 million yen, a decrease of 9.7% compared with the previous fiscal year, due to the surge in fuel prices, among others.
Forecast for the Next Full Year Ending October 2015
The global economic environment will likely remain uncertain, and there are factors which could affect the travel business, including the changing currency landscape and the global spread of infectious diseases. However, the travel business gradually takes an upturn, with an expansion of international flights at Haneda Airport in Tokyo and an increase in number of foreign travelers from Southeast Asian countries and China, among others. On the other hand, the competition surrounding the travel market gets fiercer, with direct sales, evolving global online travel agencies, and emerging companies which offer a new travel-related service with the advancement of technology, so it is ever more important to keep a close eye on market trends.
Under these business conditions, we will strive to improve our performance by leveraging our local network we have established, providing new services ahead of time in the global market, creating new value, and providing further customer satisfaction and safety.
HUIS TEN BOSCH Co. Ltd. focuses on events of only one or No. 1 value, and further evolves the "Kingdom of Flowers", "The Kingdom of Light Series", "The Kingdom of Music and Show" and "The Kingdom of Game" so that we can beat the expectation of our customers, who have visited the theme park before. Moreover, we plan to launch "The Kingdom of Health" and meet the needs of our health conscious customers. Furthermore, we will open "Smart Hotel" of the World's highest productivity standard, and continue to take up new challenges in businesses other than theme park, including the development of service robots.
About H.I.S. Co., Ltd.
H.I.S. Co., Ltd. was founded in 1980 and pioneered the Japanese discount airline ticket industry. Today the H.I.S. Group is comprised of 95 subsidiaries and 11 affiliated companies around the world, and has become a leader in the Japanese travel industry. For more information, please visit http://www.his.co.jp/english/ .
Contact:
H.I.S. Co., Ltd.
Satoshi Umemoto
Corporate Planning Division
Tel: +81-3-5908-2070
Email: umemoto.satoshi@his-world.com
Topic: Earnings
Source: H.I.S. Co., Ltd.
Sectors: Travel & Tourism
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