In the first quarter of the current consolidated fiscal year (November 1, 2017 to January 31, 2018), corporate earnings and capital expenditures increased as monetary easing continued in Japan. There was also a slow recovery in consumer spending as Japan’s labor market strengthened.Overseas, there are uncertainties about the economy even though economic growth is continuing at a slow pace. Political events in the United States, geopolitical risk and the effects of movements in financial and capital markets are all responsible for this uncertainty. As a result, outlook for the Japanese economy remained unclear.
In the wedding industry, the number of weddings in Japan in 2017 was 607,000 (Ministry of Health, Labour and Welfare, 2017 Annual Estimate of Vital Statistics), down 14,000 from 2016. Although the number of weddings and receptions is decreasing slowly as the prime wedding age population declines, the guest house wedding market is still generally healthy.
Differentiating wedding services from those of competitors by using distinctive wedding styles and services is becoming increasingly difficult. During the first quarter of the fiscal year, we took many actions in line with the IKK Group’s philosophy of “touching our customers’ hearts.” There were internal and external employee training activities to give our people the personal strengths and customer interaction skills needed to provide personalized wedding services. In addition, we used our own sales support system to analyze operating data and used many initiatives at wedding facilities to attract more customers.
To capture a larger share of Japan’s wedding market, we are working on building an infrastructure capable of quickly meeting the increasingly diverse needs and expectations of customers and using an introduction system for maintaining a cycle in which we receive new customer referrals from current customers. All these actions are aimed at sales and earnings growth.
First quarter net sales decreased 1.7% from one year earlier to 4,139 million yen, operating profit decreased 85.3% to 55 million yen, ordinary profit decreased 83.5% to 62 million yen, and profit attributable to owners of parent decreased 87.6% to 31 million yen.
A fundamental management objective at IKK Group is for our corporation to become indispensable to local communities through the contributions we make to society with our style of corporate management based on our management philosophy, “To touch our customers' hearts!” We are also aware that strengthening the growth potential and excellence of our company while increasing corporate value and longevity are among the challenges we face as management.
At IKK Group, we take seriously our mission and responsibility as a public institution of society and are determined to be a leading company in the wedding industry as we continue to share and test our corporate philosophy. Toward that end, we ask our shareholders and investors for their continued guidance and encouragement.
March 2, 2018