MARUI CO., LTD.

FINANCIAL REVIEW
OPERATING RESULTS BY BUSINESS SEGMENT
Merchandising
In the eight-month fiscal period under review, ended
September 30, 2003, Japan’s retail industry continued to be
characterized by harsh business conditions. While certain
sectors of the Japanese economy showed signs of recovery,
as in the previous fiscal year consumer spending remained
lackluster due to anxiety over job security and personal
income. Also, the retail industry was adversely affected by
an unseasonably cool summer followed by hot weather.
In this business environment, Marui strengthened its
competitiveness by remodeling existing stores to reflect the
distinctive regional characteristics of each store’s location.
Those efforts included a full remodeling of our store in
Kokubunji, Tokyo. In addition, the Company sought to
enhance store efficiency by significantly downsizing electric
appliance sales areas with a view to eventual withdrawal
from its electric appliance operations. Further, aiming to
strengthen product lineups and the operation of food
division sales areas, the Company established Marui
Seasoning Co., Ltd., in May 2003. This new subsidiary is
responsible for the management of food sales areas and
related personnel at Marui stores.
As a result of these initiatives, the merchandising segment
posted operating revenues of ¥273.7 billion and operating
income of ¥5.4 billion.
With regard to store openings, in October 2003 we
opened Kobe Marui—our first store in the Kansai region.
Moreover, plans call for the opening of Marui’s largest-ever
store, in Kitasenju in north Tokyo, in February 2004; a
second Kansai region store in autumn 2006, in Nanba, Osaka;
and a store in the Yurakucho district of central Tokyo in 2007.
Sales Breakdown by Merchandise Category
Billions of yen (% of total)
2003/9* 2003/1 2002/1 2001/1
Women’s apparel.................................................. ¥ 94.9 (34.7) ¥150.5 (33.9) ¥145.6 (32.8) ¥139.5 (32.1)
Men’s apparel and sporting goods ....................... 49.3 (18.0) 87.3 (19.7) 90.9 (20.5) 90.7 (20.9)
Luxury and accessory goods ............................... 87.1 (31.8) 141.3 (31.8) 147.9 (33.4) 144.3 (33.2)
Furniture and household appliances................... 15.1 (5.5) 24.7 (5.5) 26.0 (5.9) 28.6 (6.6)
Foodstuffs and restaurant sales ........................... 27.2 (10.0) 40.2 (9.1) 33.0 (7.4) 31.2 (7.2)
Total ................................................................. ¥273.6 (100.0) ¥444.0 (100.0) ¥443.4 (100.0) ¥434.3 (100.0)
* Eight months ended September 30, 2003.
Credit and Consumer Services
In credit and consumer services operations, Marui steadily
expanded its network of Zero First branches and grew Akai
Card membership. Thanks to a consistently prudent credit
management policy, we maintained a sound default rate of
2.1% in our mainstay consumer loan business despite the
deterioration of conditions in the consumer loan market in
recent years. Outstanding loans at the end of the fiscal
period rose 3.1% from January 31, 2003, to ¥217.2 billion,
while interest income on consumer loans for the period
totaled ¥36.6 billion. As a result, credit and consumer
services operating revenues were ¥43.9 billion and operating
income was ¥8.9 billion.
Other
The other segment—mainly comprising the operations of
subsidiaries—recorded operating revenues from outside
customers of ¥35.8 billion and operating income of ¥4.0
billion.
Total Operating Revenues
Sales Breakdown by Merchandise Category
Composition of Customer Base
by Age and Gender
(Billion ¥)
600
500
400
300
200
100
0
’00/1 ’01/1 ’02/1 ’03/1’03/9* ’05/3**
(Estimated)
572
(%)
5.5
31.8
10.0
34.7
18.0
Women’s Apparel
Men’s Apparel and
Sporting Goods
Luxury and Accessory
Goods
Furniture and Household
Appliances
Foodstuffs and Restaurant
Sales
(%)
6.9 6.2
15.3
20.4
79.6
71.6
Women
Men
10s~20s
30s
40s
50s
* Eight months ended September 30, 2003
** Full year ending March 31, 2005
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