Message to investors

GMO Pepabo, Inc.  Representative Director and CEO

We would like to extend our best wishes to all our shareholders. We are very grateful for their continued support and understanding.

Our operating results for the fiscal year ended in December 31, 2022 showed positive strength, attributable to the effect of price revision in Lolipop! On the other hand, impacted by changing consumption trends, such as a recovery in offline consumption in tandem with resumed economic activities, gross merchandise values of SUZURI and minne were lower than the previous year. In FREENANCE in the Financial Support Business, the amount of purchases of invoices expanded dramatically.

In terms of profitability, expenses for promotion activities rose due to investment in TV commercials for SUZURI.

As a result, consolidated net sales increased 6.7% year on year, to 10,500 million yen, while operating profit declined 16.5% year on year, to 730 million yen, in the fiscal year ended December 31, 2022.

In the fiscal year ending December 31, 2023, we anticipate impacts from changing consumption trends, electricity rate hikes due to soaring prices of resources and energy, and increasing costs due to rising prices such as server procurement cost. Accordingly, we implemented price revisions in Lolipop! and MuuMuu Domain to respond to the cost increase. For Color Me Shop, we will aim to attract high-end stores by offering premium plans.

Moreover, in order to deal with changing consumption trends in the non-recurring revenue business segment, we will seek to foray into new fields in minne through the creation of minne College and the launch of internal advertising, and in SUZURI by starting to handle digital content.

In FREENANCE in the Financial Support Business, we anticipate continued growth in the amount of purchases of invoices.

Given the above, we now have targets in net sales of 11,000 million yen (up 5.1% year on year) and operating profit of 850 million yen (up 17.1%) on a consolidated basis for the fiscal year ending December 31, 2023.

Finally, we would like to ask our shareholders for their continued support and guidance, as we will strive to achieve sustained growth and increase corporate value, so that our shareholders can invest in us with a sense of security.

*The above year-on-year comparisons are calculated based on retroactively adjusted figures for the fiscal year ended December 31, 2021, by applying the Accounting Standard for Revenue Recognition (ASBJ Statement No. 29, March 31, 2020), etc.

GMO Pepabo, Inc.
Representative Director and CEO
Kentaro Sato