Treasure Factory, the Tokyo-listed secondhand goods retailer, is raising its own bar again. The company has revised its full-year consolidated operating profit forecast up to ¥5,333mn from ¥5,065mn, a 5.3% increase, and lifted its net sales forecast to ¥54,975mn from ¥54,304mn, after a first quarter that ran well ahead of its own plan.
The numbers behind the upgrade are specific. First-quarter sales rose 16.4% year-on-year and operating profit rose more than 20%, with the company's own presentation citing 116.4% and 124.0% year-on-year growth for sales and operating profit respectively. Same-store sales gross margin came in at 66.3%, up 1.3 percentage points from a year earlier.
| Metric | Previous forecast | Revised forecast | Change |
|---|---|---|---|
| Net sales | ¥54,304mn | ¥54,975mn | +1.2% |
| Operating profit | ¥5,065mn | ¥5,333mn | +5.3% |
| Net income attributable to parent | ¥3,395mn | ¥3,551mn | +4.6% |
| Annual dividend per share | ¥44.00 | ¥46.00 | +¥2.00 |
Management's explanation is unusually candid about timing risk. The company said some demand that would normally show up in the second quarter arrived early in the first, pulled forward by warm-weather sales and seasonal goods. Even accounting for that pull-forward, it expects demand to stay strong through the rest of the year, helped by a rising gross margin and selling, general and administrative expenses tracking to plan. That is the caveat worth keeping in view: the upgrade rests partly on a first quarter that may have borrowed strength from the second.
The dividend move follows the same logic. Treasure Factory increased its interim dividend forecast by ¥2 to ¥24, which lifts the projected annual dividend to ¥46 per share from a prior ¥44, a payout ratio of 30.4% against the company's standing target of "30% or more". The year-end portion of the dividend, at ¥22, is unchanged for now; management said it will revisit that figure once it has more visibility on second-half trading.
For a retailer whose core business is buying and reselling other people's used clothing, electronics and hobby goods, a 24% jump in quarterly operating profit is a meaningful data point on how far reuse demand has run in Japan, even as the company itself flags that some of that strength borrowed from the months ahead.