|
Japan
|
| |
8000
|
| |
Not Applicable
|
|
|
(State or other jurisdiction of
incorporation or organization) |
| |
(Primary Standard Industrial
Classification Code Number) |
| |
(I.R.S. Employer
Identification Number) |
|
|
Barbara A. Jones
Greenberg Traurig, LLP 1840 Century Park East, Suite 1900 Los Angeles, CA 90067 Tel: (310) 586-7773 Fax: (310) 586-0273 |
| |
Koji Ishikawa
Greenberg Traurig Tokyo Law Offices Meiji Yasuda Seimei Building, 14F 2-1-1 Marunouchi, Chiyoda-ku Tokyo 100-0005, Japan Tel: +81(0)3-4510-2200 Fax: +81(0)3-4510-2201 |
| |
Barry Grossman
Sarah Williams Matthew Bernstein Ellenoff Grossman & Schole LLP 1345 Avenue of the Americas New York, New York 10105 Tel: (212) 370-1300 Fax: (212) 370-7889 |
|
| | |
Page
|
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| | | | F-1 | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted
EBITDA margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | ||||||||||||||||||||||||||||||
Consolidated Statement of Income Information:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues: | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Relaxation Salons
|
| | | $ | 19,006 | | | | | ¥ | 2,110,561 | | | | | ¥ | 1,344,503 | | | | | $ | 29,860 | | | | | ¥ | 3,315,947 | | | | | ¥ | 3,864,656 | | |
Digital Preventative Healthcare
|
| | | | 152 | | | | | | 16,918 | | | | | | 11,774 | | | | | | 231 | | | | | | 25,670 | | | | | | 43,608 | | |
Total revenue
|
| | | | 19,158 | | | | | | 2,127,479 | | | | | | 1,356,277 | | | | | | 30,091 | | | | | | 3,341,617 | | | | | | 3,908,264 | | |
Cost of revenues and operating expenses:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues
|
| | | | 15,929 | | | | | | 1,768,907 | | | | | | 1,269,220 | | | | | | 26,228 | | | | | | 2,912,667 | | | | | | 2,957,506 | | |
Selling, general and administrative expenses
|
| | | | 7,571 | | | | | | 840,760 | | | | | | 521,364 | | | | | | 9,622 | | | | | | 1,068,537 | | | | | | 871,862 | | |
Impairment loss on long-lived assets
|
| | | | — | | | | | | — | | | | | | — | | | | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | |
Total cost of revenues and
operating expenses |
| | | | 23,500 | | | | | | 2,609,667 | | | | | | 1,790,584 | | | | | | 36,809 | | | | | | 4,087,705 | | | | | | 3,873,914 | | |
Operating (loss) income
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | | | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | |
Other income (expenses): | | | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Dividend income
|
| | | | — | | | | | | 2 | | | | | | 2 | | | | | | — | | | | | | 2 | | | | | | 2 | | |
Interest income
|
| | | | 4 | | | | | | 506 | | | | | | 674 | | | | | | 12 | | | | | | 1,332 | | | | | | 1,336 | | |
Interest expense
|
| | | | (60) | | | | | | (6,683) | | | | | | (6,076) | | | | | | (119) | | | | | | (13,234) | | | | | | (13,591) | | |
Gain from bargain
purchases |
| | | | 9 | | | | | | 1,014 | | | | | | 1,624 | | | | | | — | | | | | | — | | | | | | 6,487 | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted
EBITDA margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | ||||||||||||||||||||||||||||||
Government subsidies and other, net
|
| | | | 187 | | | | | | 20,798 | | | | | | 14,142 | | | | | | 1,182 | | | | | | 131,299 | | | | | | 4,153 | | |
Total other income (expenses)
|
| | | | 140 | | | | | | 15,637 | | | | | | 10,366 | | | | | | 1,075 | | | | | | 119,399 | | | | | | (1,613) | | |
Income tax expense
(benefit) |
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | | | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings of investment
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 559 | | |
Net (loss) income
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Adjusted EBITDA(1)
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | | | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | |
Adjusted EBITDA
margin(2) |
| | | | (13.7)% | | | | | | (13.7)% | | | | | | (27.6)% | | | | | | (16.3)% | | | | | | (16.3)% | | | | | | 3.6% | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted EBITDA
margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
Reconciliation of non-GAAP measures:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net (loss) income
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Dividend income and interest income
|
| | | | (4) | | | | | | (508) | | | | | | (676) | | | | | | (12) | | | | | | (1,334) | | | | | | (1,338) | | |
Interest expense
|
| | | | 60 | | | | | | 6,683 | | | | | | 6,076 | | | | | | 119 | | | | | | 13,234 | | | | | | 13,591 | | |
Gain from bargain purchases
|
| | | | (9) | | | | | | (1,014) | | | | | | (1,624) | | | | | | — | | | | | | — | | | | | | (6,487) | | |
Government subsidies and other, net
|
| | | | (187) | | | | | | (20,798) | | | | | | (14,142) | | | | | | (1,182) | | | | | | (131,299) | | | | | | (4,153) | | |
Income tax expense
|
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | | | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings of investment
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (559) | | |
Operating (loss) income
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | | | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | |
Depreciation and amortization
|
| | | | 357 | | | | | | 39,631 | | | | | | 33,105 | | | | | | 561 | | | | | | 62,290 | | | | | | 46,174 | | |
Losses on sales of directly-operated salons to franchises
|
| | | | — | | | | | | 49 | | | | | | 65 | | | | | | — | | | | | | — | | | | | | 9,600 | | |
Losses on disposal of property and
equipment, net and other intangible assets, net |
| | | | 18 | | | | | | 1,967 | | | | | | 26,913 | | | | | | 304 | | | | | | 33,841 | | | | | | 4,631 | | |
Stock compensation expense*
|
| | | | 1,341 | | | | | | 148,940 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Impairment loss on long-lived assets
|
| | | | — | | | | | | — | | | | | | — | | | | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | |
Adjusted EBITDA
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | | | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | |
Adjusted EBITDA margin
|
| | | | (13.7)% | | | | | | (13.7)% | | | | | | (27.6)% | | | | | | (16.3)% | | | | | | (16.3)% | | | | | | 3.6% | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||
| | |
2021
|
| |
2020
|
| |
2020
|
| |
2019
|
| ||||||||||||
Other Operating Data: | | | | | | | | | | | | | | | | | | | | | | | | | |
Number of Salons
|
| | | | 313 | | | | | | 289 | | | | | | 290 | | | | | | 283 | | |
Sales per Customer(3)
|
| | | ¥ | 6,350 | | | | | ¥ | 6,234 | | | | | ¥ | 6,486 | | | | | ¥ | 6,064 | | |
Repeat Ratio(4)
|
| | | | 81.2% | | | | | | 81.2% | | | | | | 82.6% | | | | | | 81.7% | | |
Operation Ratio(5)
|
| | | | 48.6% | | | | | | 40.8% | | | | | | 48.2% | | | | | | 50.4% | | |
| | |
As of June 30,
|
| |
As of December 31,
|
| ||||||||||||||||||
(in thousands)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||
| | |
(unaudited)
|
| | | | ||||||||||||||||||
Consolidated Balance Sheet Information: | | | | | | | | | | | | | | | | | | | | | | | | | |
Total assets
|
| | | ¥ | 5,200,016 | | | | | ¥ | 4,097,971 | | | | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | |
Total liabilities
|
| | | | 4,993,947 | | | | | | 3,940,884 | | | | | | 5,222,209 | | | | | | 4,157,407 | | |
Equity
|
| | | | | | | | | | | | | | | ||||||||||
Common stock, no par value;
19,899,999 shares authorized; 4,975,000 shares issued and 4,882,500 shares outstanding at June 30, 2021; 9,999,999 shares authorized; 4,915,000 shares issued and 4,822,500 shares outstanding at December 31, 2020 |
| | | | 1,223,134 | | | | | | 595,000 | | | | | | 1,179,313 | | | | | | 595,000 | | |
Class A common stock, no par value
|
| | | | 100 | | | | | | 100 | | | | | | 100 | | | | | | 100 | | |
Treasury stock, at cost — 92,500 common shares
|
| | | | (3,000) | | | | | | (3,000) | | | | | | (3,000) | | | | | | (3,000) | | |
Additional paid-in capital
|
| | | | 1,210,907 | | | | | | 713,267 | | | | | | 1,018,146 | | | | | | 713,267 | | |
Accumulated deficit
|
| | | | (2,225,072) | | | | | | (1,148,280) | | | | | | (1,703,302) | | | | | | (705,309) | | |
Total equity
|
| | | | 206,069 | | | | | | 157,087 | | | | | | 491,257 | | | | | | 600,058 | | |
Total Liabilities and Equity
|
| | | ¥ | 5,200,016 | | | | | ¥ | 4,097,971 | | | | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | |
(thousands, except share amounts)
|
| |
As of June 30, 2021
|
| |||||||||
|
Actual
|
| |
Pro Forma(1)
|
| ||||||||
Cash and cash equivalents(2)
|
| | | $ | 3,196 | | | | | $ | 7,934 | | |
Debt
|
| | | $ | 6,800 | | | | | $ | 6,800 | | |
Shareholders’ equity: | | | | | | | | | | | | | |
Common stock, no par value; 19,899,999 shares authorized; 4,975,000 shares
issued and 4,882,500 shares outstanding, actual; 19,899,999 shares authorized; 5,775,000 shares issued and 5,682,500 shares outstanding, pro forma |
| | | | 11,014 | | | | | | 13,351 | | |
Class A Shares, no par value−1 share authorized, 1 share issued and
outstanding, actual; 1 share authorized; 1 share issued and outstanding, pro forma |
| | | | 1 | | | | | | 1 | | |
Additional paid-in capital
|
| | | | 10,905 | | | | | | 13,241 | | |
Accumulated deficit
|
| | | | (20,037) | | | | | | (19,973) | | |
Treasury stock, at cost
|
| | | | (27) | | | | | | (27) | | |
Total shareholders’ equity
|
| | | | 1,856 | | | | | | 6,593 | | |
Total capitalization
|
| | | $ | 8,656 | | | | | $ | 13,393 | | |
|
Assumed public offering price per ADS
|
| | | | | | | | | $ | 6.94 | | |
|
Net tangible book value per common share before this offering (as of June 30, 2021)
|
| | | $ | (0.78) | | | | | | | | |
|
Increase in net tangible book value per ADS attributable to purchasers in this offering
|
| | | $ | 0.95 | | | | | | | | |
|
Pro forma net tangible book value per ADS immediately after this offering
|
| | | | | | | | | $ | 0.17 | | |
|
Dilution in pro forma net tangible book value per ADS to purchasers in this offering
|
| | | | | | | | | $ | 6.77 | | |
| | |
Common Shares
|
| |
Total Consideration
|
| ||||||||||||||||||||||||
|
Number
|
| |
Percent
|
| |
Amount
|
| |
Percent
|
| |
Weighted
Average Price Per Share |
| |||||||||||||||||
Existing shareholders
|
| | | | 4,882,500 | | | | | | 86% | | | | | $ | 23,631,418 | | | | | | 81% | | | | | $ | 4.84 | | |
Purchasers in this offering
|
| | | | 800,000 | | | | | | 14% | | | | | $ | 5,552,000 | | | | | | 19% | | | | | $ | 6.94 | | |
Total
|
| | | | 5,682,500 | | | | | | 100% | | | | | $ | 29,183,418 | | | | | | 100% | | | | | $ | 5.14 | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted EBITDA
margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |||||||||||||||
Consolidated Statement of Income Information:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues:
|
| | | | | | | | | | | | | | | | | | | | | | |||||||||||||||
Relaxation Salons
|
| | | $ | 19,006 | | | | | ¥ | 2,110,561 | | | | | ¥ | 1,344,503 | | | | | $ | 29,860 | | | | | ¥ | 3,315,947 | | | | | ¥ | 3,864,656 | | |
Digital Preventative Healthcare
|
| | | | 152 | | | | | | 16,918 | | | | | | 11,774 | | | | | | 231 | | | | | | 25,670 | | | | | | 43,608 | | |
Total revenue
|
| | | | 19,158 | | | | | | 2,127,479 | | | | | | 1,356,277 | | | | | | 30,091 | | | | | | 3,341,617 | | | | | | 3,908,264 | | |
Cost of revenues and operating
expenses: |
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues
|
| | | | 15,929 | | | | | | 1,768,907 | | | | | | 1,269,220 | | | | | | 26,228 | | | | | | 2,912,667 | | | | | | 2,957,507 | | |
Selling, general and administrative expenses
|
| | | | 7,571 | | | | | | 840,760 | | | | | | 521,364 | | | | | | 9,622 | | | | | | 1,068,537 | | | | | | 871,862 | | |
Impairment loss on long-lived assets
|
| | | | — | | | | | | — | | | | | | — | | | | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | |
Total cost of revenues and operating expenses
|
| | | | 23,500 | | | | | | 2,609,667 | | | | | | 1,790,584 | | | | | | 36,809 | | | | | | 4,087,705 | | | | | | 3,873,914 | | |
Operating (loss) income
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | | | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | |
Other income (expenses): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Dividend income
|
| | | | — | | | | | | 2 | | | | | | 2 | | | | | | — | | | | | | 2 | | | | | | 2 | | |
Interest income
|
| | | | 4 | | | | | | 506 | | | | | | 674 | | | | | | 12 | | | | | | 1,332 | | | | | | 1,336 | | |
Interest expense
|
| | | | (60) | | | | | | (6,683) | | | | | | (6,076) | | | | | | (119) | | | | | | (13,234) | | | | | | (13,591) | | |
Gain from bargain purchases
|
| | | | 9 | | | | | | 1,014 | | | | | | 1,624 | | | | | | — | | | | | | — | | | | | | 6,487 | | |
Government subsidies and other, net
|
| | | | 187 | | | | | | 20,798 | | | | | | 14,142 | | | | | | 1,182 | | | | | | 131,299 | | | | | | 4,153 | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted EBITDA
margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |||||||||||||||
Total other income (expenses)
|
| | | | 140 | | | | | | 15,637 | | | | | | 10,366 | | | | | | 1,075 | | | | | | 119,399 | | | | | | (1,613) | | |
Income tax expense (benefit)
|
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | | | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings of investment
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 559 | | |
Net (loss) income
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Adjusted EBITDA(1)
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | | | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | |
Adjusted EBITDA margin(2)
|
| |
(13.7)%
|
| |
(13.7)%
|
| |
(27.6)%
|
| |
(16.3)%
|
| |
(16.3)%
|
| |
3.6%
|
|
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
(in thousands, except Adjusted EBITDA
margin) |
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |||||||||||||||
Reconciliation of non-GAAP measures:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Net (loss) income
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Dividend income and interest income
|
| | | | (4) | | | | | | (508) | | | | | | (676) | | | | | | (12) | | | | | | (1,334) | | | | | | (1,338) | | |
Interest expense
|
| | | | 60 | | | | | | 6,683 | | | | | | 6,076 | | | | | | 119 | | | | | | 13,234 | | | | | | 13,591 | | |
Gain from bargain purchases
|
| | | | (9) | | | | | | (1,014) | | | | | | (1,624) | | | | | | — | | | | | | — | | | | | | (6,487) | | |
Government subsidies and other, net
|
| | | | (187) | | | | | | (20,798) | | | | | | (14,142) | | | | | | (1,182) | | | | | | (131,299) | | | | | | (4,153) | | |
Income tax expense
|
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | | | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings of investment
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (559) | | |
Operating (loss) income
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | | | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | |
Depreciation and amortization
|
| | | | 357 | | | | | | 39,631 | | | | | | 33,105 | | | | | | 561 | | | | | | 62,290 | | | | | | 46,174 | | |
Losses on sales of directly-operated
salons to franchises |
| | | | — | | | | | | 49 | | | | | | 65 | | | | | | — | | | | | | — | | | | | | 9,600 | | |
Losses on disposal of property and
equipment, net and other intangible assets, net |
| | | | 18 | | | | | | 1,967 | | | | | | 26,913 | | | | | | 304 | | | | | | 33,841 | | | | | | 4,631 | | |
Stock compensation expense*
|
| | | | 1,341 | | | | | | 148,940 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Impairment loss on long-lived assets
|
| | | | — | | | | | | — | | | | | | — | | | | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | |
Adjusted EBITDA
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | | | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | |
Adjusted EBITDA margin
|
| |
(13.7)%
|
| |
(13.7)%
|
| |
(27.6)%
|
| |
(16.3)%
|
| |
(16.3)%
|
| |
3.6%
|
|
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||
| | |
2021
|
| |
2020
|
| |
2020
|
| |
2019
|
|
Other Operating Data: | | | | | | | | | | | | | |
Number of Salons
|
| |
313
|
| |
289
|
| |
290
|
| |
283
|
|
Sales per Customer(3)
|
| |
¥6,350
|
| |
¥6,234
|
| |
¥6,486
|
| |
¥6,064
|
|
Repeat Ratio(4)
|
| |
81.2%
|
| |
81.2%
|
| |
82.6%
|
| |
81.7%
|
|
Operation Ratio(5)
|
| |
48.6%
|
| |
40.8%
|
| |
48.2%
|
| |
50.4%
|
|
| | |
As of June 30,
|
| |
As of December 31,
|
| | ||||||||||||||||||||
(in thousands)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020(¥)
|
| |
2019(¥)
|
| | ||||||||||||||
| | |
(unaudited)
|
| | | | | | | | | | | | | | |||||||||||
Consolidated Balance Sheet Information: | | | | | | | | | | | | | | | | | | | | |||||||||
Total assets
|
| | | ¥ | 5,200,016 | | | | | ¥ | 4,097,971 | | | | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | | | ||
Total liabilities
|
| | | | 4,993,947 | | | | | | 3,940,884 | | | | | | 5,222,209 | | | | | | 4,157,407 | | | | ||
Equity
|
| | | | | | | | | | | | | | | | | | | | | | | | | | ||
Common stock, no par value; 19,899,999
shares authorized; 4,975,000 shares issued and 4,882,500 shares outstanding at June 30, 2021; 9,999,999 shares authorized; 4,915,000 shares issued and 4,822,500 shares outstanding at December 31, 2020 |
| | | | 1,223,134 | | | | | | 595,000 | | | | | | 1,179,313 | | | | | | 595,000 | | | | ||
Class A common stock, no par value
|
| | | | 100 | | | | | | 100 | | | | | | 100 | | | | | | 100 | | | | ||
Treasury stock, at cost — 92,500 common shares
|
| | | | (3,000) | | | | | | (3,000) | | | | | | (3,000) | | | | | | (3,000) | | | | ||
Additional paid-in capital
|
| | | | 1,210,907 | | | | | | 713,267 | | | | | | 1,018,146 | | | | | | 713,267 | | | | ||
Accumulated deficit
|
| | | | (2,225,072) | | | | | | (1,148,280) | | | | | | (1,703,302) | | | | | | (705,309) | | | | ||
Total equity
|
| | | | 206,069 | | | | | | 157,087 | | | | | | 491,257 | | | | | | 600,058 | | | | ||
Total Liabilities and Equity
|
| | | ¥ | 5,200,016 | | | | | ¥ | 4,097,971 | | | | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | | |
| | |
Number
of Salons |
| |
Number
of Salons with Data |
| |
Total
Customers Served |
| |
Sales Per
Customer |
| |
Repeat
Ratio |
| |
Operation
Ratio |
| ||||||||||||||||||
Jan-20
|
| | | | 286 | | | | | | 222 | | | | | | 64,914 | | | | | | JPY6,164 | | | | | | 81.8% | | | | | | 46.7% | | |
Feb-20
|
| | | | 286 | | | | | | 222 | | | | | | 61,307 | | | | | | JPY6,235 | | | | | | 83.3% | | | | | | 45.5% | | |
Mar-20
|
| | | | 288 | | | | | | 222 | | | | | | 52,612 | | | | | | JPY6,313 | | | | | | 85.0% | | | | | | 38.9% | | |
Apr-20
|
| | | | 290 | | | | | | 224 | | | | | | 13,381 | | | | | | JPY6,209 | | | | | | 88.0% | | | | | | 19.7% | | |
May-20
|
| | | | 289 | | | | | | 222 | | | | | | 19,451 | | | | | | JPY6,244 | | | | | | 84.5% | | | | | | 29.0% | | |
Jun-20
|
| | | | 289 | | | | | | 221 | | | | | | 51,686 | | | | | | JPY6,234 | | | | | | 81.2% | | | | | | 40.8% | | |
Jul-20
|
| | | | 288 | | | | | | 221 | | | | | | 60,964 | | | | | | JPY6,276 | | | | | | 80.6% | | | | | | 43.3% | | |
Aug-20
|
| | | | 284 | | | | | | 221 | | | | | | 66,464 | | | | | | JPY6,351 | | | | | | 80.4% | | | | | | 47.5% | | |
Sep-20
|
| | | | 284 | | | | | | 221 | | | | | | 64,809 | | | | | | JPY6,245 | | | | | | 80.2% | | | | | | 48.1% | | |
Oct-20
|
| | | | 291 | | | | | | 221 | | | | | | 65,820 | | | | | | JPY6,269 | | | | | | 80.3% | | | | | | 47.0% | | |
Nov-20
|
| | | | 291 | | | | | | 220 | | | | | | 63,993 | | | | | | JPY6,312 | | | | | | 80.7% | | | | | | 47.6% | | |
Dec-20
|
| | | | 290 | | | | | | 221 | | | | | | 64,649 | | | | | | JPY6,486 | | | | | | 82.6% | | | | | | 48.2% | | |
Jan-21
|
| | | | 302 | | | | | | 218 | | | | | | 56,557 | | | | | | JPY6,443 | | | | | | 84.0% | | | | | | 44.6% | | |
Feb-21
|
| | | | 302 | | | | | | 218 | | | | | | 56,370 | | | | | | JPY6,443 | | | | | | 83.0% | | | | | | 47.6% | | |
Mar-21
|
| | | | 303 | | | | | | 217 | | | | | | 62,441 | | | | | | JPY6,352 | | | | | | 81.9% | | | | | | 47.0% | | |
Apr-21
|
| | | | 301 | | | | | | 219 | | | | | | 63,682 | | | | | | JPY6,250 | | | | | | 81.4% | | | | | | 46.3% | | |
May-21
|
| | | | 313 | | | | | | 212 | | | | | | 66,604 | | | | | | JPY6,370 | | | | | | 80.6% | | | | | | 48.7% | | |
Jun-21
|
| | | | 313 | | | | | | 219 | | | | | | 68,069 | | | | | | JPY6,350 | | | | | | 81.2% | | | | | | 48.6% | | |
Jul-21
|
| | | | 314 | | | | | | 220 | | | | | | 70,912 | | | | | | JPY6,498 | | | | | | 81.0% | | | | | | 48.1% | | |
Aug-21
|
| | | | 315 | | | | | | 221 | | | | | | 66,323 | | | | | | JPY6,592 | | | | | | 81.3% | | | | | | 46.5% | | |
Sep-21
|
| | | | 316 | | | | | | 221 | | | | | | 65,130 | | | | | | JPY6,428 | | | | | | 82.0% | | | | | | 46.7% | | |
Oct-21
|
| | | | 316 | | | | | | 221 | | | | | | 68,608 | | | | | | JPY6,486 | | | | | | 83.3% | | | | | | 48.9% | | |
Nov-21
|
| | | | 316 | | | | | | 221 | | | | | | 65,569 | | | | | | JPY6,466 | | | | | | 81.9% | | | | | | 47.7% | | |
Dec-21 | | | | | 312 | | | | | | 221 | | | | | | 71,173 | | | | | | JPY6,634 | | | | | | 81.7% | | | | | | 50.5% | | |
(in thousands, except change % data and
Adjusted EBITDA margin ) |
| |
Six months ended June 30,
|
| |
Change (2021 vs 2020)
|
| ||||||||||||||||||||||||||||||
Consolidated Statement of Income Information:
|
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
$
|
| |
¥
|
| |
%
|
| ||||||||||||||||||
| | |
(unaudited)
|
| | | | | | | | | | | | | | | | | | | |||||||||||||||
Revenues:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Relaxation Salons
|
| | | $ | 19,006 | | | | | ¥ | 2,110,561 | | | | | ¥ | 1,344,503 | | | | | $ | 6,898 | | | | | ¥ | 766,058 | | | | | | 57.0% | | |
Digital Preventative Healthcare
|
| | | | 152 | | | | | | 16,918 | | | | | | 11,774 | | | | | | 47 | | | | | | 5,144 | | | | | | 43.7% | | |
Total revenue
|
| | | | 19,158 | | | | | | 2,127,479 | | | | | | 1,356,277 | | | | | | 6,945 | | | | | | 771,202 | | | | | | 56.9% | | |
Cost of revenues and operating expenses:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues
|
| | | | 15,929 | | | | | | 1,768,907 | | | | | | 1,269,220 | | | | | | 4,500 | | | | | | 499,687 | | | | | | 39.4% | | |
Selling, general and administrative expenses
|
| | | | 7,571 | | | | | | 840,760 | | | | | | 521,364 | | | | | | 2,876 | | | | | | 319,396 | | | | | | 61.3% | | |
Total cost of revenues and operating expenses
|
| | | | 23,500 | | | | | | 2,609,667 | | | | | | 1,790,584 | | | | | | 7,376 | | | | | | 819,083 | | | | | | 45.7% | | |
Operating loss
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | | | | $ | (431) | | | | | ¥ | (47,881) | | | | | | 11.0% | | |
Other income (expenses): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Dividend income
|
| | | | — | | | | | | 2 | | | | | | 2 | | | | | | — | | | | | | — | | | | | | —% | | |
Interest income
|
| | | | 4 | | | | | | 506 | | | | | | 674 | | | | | | (2) | | | | | | (168) | | | | | | (24.9)% | | |
Interest expense
|
| | | | (60) | | | | | | (6,683) | | | | | | (6,076) | | | | | | (5) | | | | | | (607) | | | | | | 10.0% | | |
Gain from bargain purchases
|
| | | | 9 | | | | | | 1,014 | | | | | | 1,624 | | | | | | (6) | | | | | | (610) | | | | | | (37.6)% | | |
Government subsidies and
other, net |
| | | | 187 | | | | | | 20,798 | | | | | | 14,142 | | | | | | 60 | | | | | | 6,656 | | | | | | 47.1% | | |
Total other income (expenses)
|
| | | | 140 | | | | | | 15,637 | | | | | | 10,366 | | | | | | 47 | | | | | | 5,271 | | | | | | 50.8% | | |
Income tax expense
|
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | | | | | 326 | | | | | | 36,189 | | | | | | 190.2% | | |
Net loss
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (710) | | | | | ¥ | (78,799) | | | | | | 17.8% | | |
Adjusted EBITDA(1)
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | | | | $ | 744 | | | | | ¥ | 82,574 | | | | | | (22.1)% | | |
Adjusted EBITDA margin(2)
|
| | | | (13.7)% | | | | | | (13.7)% | | | | | | (27.6)% | | | | | | — | | | | | | — | | | | | | 13.9pt | | |
Reconciliation of non-GAAP measures:
|
| |
Six months ended June 30,
|
| |||||||||||||||
(in thousands, except Adjusted EBITDA margin)
|
| |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |||||||||
Net loss
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | |
Dividend income and interest income
|
| | | | (4) | | | | | | (508) | | | | | | (676) | | |
Interest expense
|
| | | | 60 | | | | | | 6,683 | | | | | | 6,076 | | |
Gain from bargain purchases
|
| | | | (9) | | | | | | (1,014) | | | | | | (1,624) | | |
Government subsidies and other, net
|
| | | | (187) | | | | | | (20,798) | | | | | | (14,142) | | |
Income tax expense
|
| | | | 497 | | | | | | 55,219 | | | | | | 19,030 | | |
Operating loss
|
| | | $ | (4,342) | | | | | ¥ | (482,188) | | | | | ¥ | (434,307) | | |
Depreciation and amortization
|
| | | | 357 | | | | | | 39,631 | | | | | | 33,105 | | |
Losses on sales of directly-operated salons to franchises
|
| | | | — | | | | | | 49 | | | | | | 65 | | |
Losses on disposal of property and equipment, net and other intangible
assets, net |
| | | | 18 | | | | | | 1,967 | | | | | | 26,913 | | |
Stock compensation expense*
|
| | | | 1,341 | | | | | | 148,940 | | | | | | — | | |
Adjusted EBITDA
|
| | | $ | (2,626) | | | | | ¥ | (291,601) | | | | | ¥ | (374,224) | | |
Adjusted EBITDA margin(2)
|
| | | | (13.7)% | | | | | | (13.7)% | | | | | | (27.6)% | | |
| | |
2020
|
| |
2021
|
| ||||||||||||||||||||||||||||||||||||||||||||||||
| | |
Number of
Salons |
| |
Total
Customers Served |
| |
Sales Per
Customer(3) |
| |
Repeat
Ratio |
| |
Operation
Ratio |
| |
Number of
Salons |
| |
Total
Customers Served |
| |
Sales Per
Customer(3) |
| |
Repeat
Ratio |
| |
Operation
Ratio |
| ||||||||||||||||||||||||
January
|
| | | | 286 | | | | | | 64,914 | | | |
JPY 6,164
|
| | | | 81.8% | | | | | | 46.7% | | | | | | 302 | | | | | | 56,557 | | | |
JPY 6,443
|
| | | | 84.0% | | | | | | 44.6% | | |
February
|
| | | | 286 | | | | | | 61,307 | | | |
JPY 6,235
|
| | | | 83.3% | | | | | | 45.5% | | | | | | 302 | | | | | | 56,370 | | | |
JPY 6,443
|
| | | | 83.0% | | | | | | 47.6% | | |
March
|
| | | | 288 | | | | | | 52,612 | | | |
JPY 6,313
|
| | | | 85.0% | | | | | | 38.9% | | | | | | 303 | | | | | | 62,441 | | | |
JPY6,352
|
| | | | 81.9% | | | | | | 47.0% | | |
April
|
| | | | 290 | | | | | | 13,381 | | | |
JPY 6,209
|
| | | | 88.0% | | | | | | 19.7% | | | | | | 301 | | | | | | 63,682 | | | |
JPY 6,250
|
| | | | 81.4% | | | | | | 46.3% | | |
May
|
| | | | 289 | | | | | | 19,451 | | | |
JPY 6,244
|
| | | | 84.5% | | | | | | 29.0% | | | | | | 313 | | | | | | 66,604 | | | |
JPY 6,370
|
| | | | 80.6% | | | | | | 48.7% | | |
June
|
| | | | 289 | | | | | | 51,686 | | | |
JPY 6,234
|
| | | | 81.2% | | | | | | 40.8% | | | | | | 313 | | | | | | 68,069 | | | |
JPY 6,350
|
| | | | 81.2% | | | | | | 48.6% | | |
(in thousands, except change % data and
Adjusted EBITDA margin) Consolidated Statement of Income Information: |
| |
Year ended December 31,
|
| |
Change (2020 vs 2019)
|
| ||||||||||||||||||||||||||||||
|
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| |
$
|
| |
¥
|
| |
%
|
| ||||||||||||||||||||
Revenues: | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Relaxation Salons
|
| | | $ | 29,860 | | | | | ¥ | 3,315,947 | | | | | ¥ | 3,864,656 | | | | | $ | (4,941) | | | | | ¥ | (548,709) | | | | | | (14.2)% | | |
Digital Preventative Healthcare
|
| | | | 231 | | | | | | 25,670 | | | | | | 43,608 | | | | | | (162) | | | | | | (17,938) | | | | | | (41.1)% | | |
Total revenue
|
| | | | 30,091 | | | | | | 3,341,617 | | | | | | 3,908,264 | | | | | | (5,103) | | | | | | (566,647) | | | | | | (14.5)% | | |
Cost of revenues and operating expenses:
|
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Cost of revenues
|
| | | | 26,228 | | | | | | 2,912,667 | | | | | | 2,957,506 | | | | | | (404) | | | | | | (44,839) | | | | | | (1.5)% | | |
Selling, general and administrative expenses
|
| | | | 9,622 | | | | | | 1,068,537 | | | | | | 871,862 | | | | | | 1,771 | | | | | | 196,675 | | | | | | 22.6% | | |
Impairment loss on long-lived assets
|
| | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | | | | | 558 | | | | | | 61,955 | | | | | | 139.1% | | |
Total cost of revenues and operating expenses
|
| | | | 36,809 | | | | | | 4,087,705 | | | | | | 3,873,914 | | | | | | 1,925 | | | | | | 213,791 | | | | | | 5.5% | | |
Operating (loss) income
|
| | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | | | | $ | (7,028) | | | | | ¥ | (780,438) | | | | | | (2272.0)% | | |
Other income (expenses): | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
Dividend income
|
| | | | — | | | | | | 2 | | | | | | 2 | | | | | | — | | | | | | — | | | | | | 0.0% | | |
Interest income
|
| | | | 12 | | | | | | 1,332 | | | | | | 1,336 | | | | | | — | | | | | | (4) | | | | | | (0.3)% | | |
Interest expense
|
| | | | (119) | | | | | | (13,234) | | | | | | (13,591) | | | | | | 3 | | | | | | 357 | | | | | | (2.6)% | | |
Gain from bargain purchases
|
| | | | — | | | | | | — | | | | | | 6,487 | | | | | | (58) | | | | | | (6,487) | | | | | | (100.0)% | | |
Government subsidies and other, net
|
| | | | 1,182 | | | | | | 131,299 | | | | | | 4,153 | | | | | | 1,145 | | | | | | 127,146 | | | | | | 3061.5% | | |
Total other income
(expenses) |
| | | | 1,075 | | | | | | 119,399 | | | | | | (1,613) | | | | | | 1,090 | | | | | | 121,012 | | | | | | (7502.3)% | | |
Income tax (benefit) expense
|
| | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | | | | | (932) | | | | | | (103,480) | | | | | | (648.3)% | | |
(in thousands, except change % data and
Adjusted EBITDA margin) Consolidated Statement of Income Information: |
| |
Year ended December 31,
|
| |
Change (2020 vs 2019)
|
| ||||||||||||||||||||||||||||||
|
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| |
$
|
| |
¥
|
| |
%
|
| ||||||||||||||||||||
Equity in earnings (loss) of investment
|
| | | | — | | | | | | — | | | | | | 559 | | | | | | (5) | | | | | | (559) | | | | | | (100.0)% | | |
Net (loss) income
|
| | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | | | | $ | (5,011) | | | | | ¥ | (556,505) | | | | | | (3210.3)% | | |
Adjusted EBITDA(1)
|
| | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | | | | $ | (6,148) | | | | | ¥ | (682,757) | | | | | | (490.1)% | | |
Adjusted EBITDA margin(2)
|
| | | | (16.3)% | | | | | | (16.3)% | | | | | | 3.6% | | | | | | — | | | | | | — | | | | | | (19.9)pt | | |
Reconciliation of non-GAAP measures:
(in thousands, except Adjusted EBITDA margin) |
| |
Year ended December 31,
|
| |||||||||||||||
|
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| |||||||||||
Net (loss) income
|
| | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Dividend income and interest income
|
| | | | (12) | | | | | | (1,334) | | | | | | (1,338) | | |
Interest expense
|
| | | | 119 | | | | | | 13,234 | | | | | | 13,591 | | |
Gain from bargain purchases
|
| | | | — | | | | | | — | | | | | | (6,487) | | |
Government subsidies and other, net
|
| | | | (1,182) | | | | | | (131,299) | | | | | | (4,153) | | |
Income tax expense
|
| | | | (788) | | | | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings (loss) of investment
|
| | | | — | | | | | | — | | | | | | (559) | | |
Operating income
|
| | | $ | (6,718) | | | | | ¥ | (746,088) | | | | | ¥ | 34,350 | | |
Depreciation and amortization
|
| | | | 561 | | | | | | 62,290 | | | | | | 46,174 | | |
Losses on sales of directly-operated salons to franchises
|
| | | | — | | | | | | — | | | | | | 9,600 | | |
Losses on disposal of property and equipment, net and other intangible
assets, net |
| | | | 304 | | | | | | 33,841 | | | | | | 4,631 | | |
Impairment loss on long-lived assets
|
| | | | 959 | | | | | | 106,501 | | | | | | 44,546 | | |
Adjusted EBITDA
|
| | | $ | (4,894) | | | | | ¥ | (543,456) | | | | | ¥ | 139,301 | | |
Adjusted EBITDA margin(2)
|
| | | | (16.3)% | | | | | | (16.3)% | | | | | | 3.6% | | |
| | |
Year ended December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Number of Salons
|
| | | | 290 | | | | | | 283 | | |
Sales per Customer(3)
|
| | | ¥ | 6,486 | | | | | ¥ | 6,064 | | |
Repeat Ratio(4)
|
| | | | 82.6% | | | | | | 81.7% | | |
Operation Ratio(5)
|
| | | | 48.2% | | | | | | 50.4% | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
| | |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
Net (loss) income attributable to shareholders
|
| | | $ | (4,699) | | | | | ¥ | (521,770) | | | | | ¥ | (442,971) | | | | | $ | (4,855) | | | | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Net cash (used in) provided by operating activities
|
| | | | (3,136) | | | | | | (348,266) | | | | | | (374,861) | | | | | | (3,299) | | | | | | (366,420) | | | | | | 7,870 | | |
Net cash used in investing activities
|
| | | | (3,694) | | | | | | (410,250) | | | | | | (57,255) | | | | | | (1,257) | | | | | | (139,599) | | | | | | (37,931) | | |
Net cash (used in) provided by financing activities
|
| | | | (2,938) | | | | | | (326,267) | | | | | | 143,555 | | | | | | 12,896 | | | | | | 1,432,131 | | | | | | 331,994 | | |
Net change of cash and cash equivalents during the period
|
| | | | (9,768) | | | | | | (1,084,783) | | | | | | (288,561) | | | | | | 8,340 | | | | | | 926,112 | | | | | | 301,933 | | |
| | |
Six months ended June 30,
|
| |
Year ended December 31,
|
| ||||||||||||||||||||||||||||||
| | |
2021($)
|
| |
2021(¥)
|
| |
2020(¥)
|
| |
2020($)
|
| |
2020(¥)
|
| |
2019(¥)
|
| ||||||||||||||||||
Cash and cash equivalents at beginning of period
|
| | | | 12,965 | | | | | | 1,439,733 | | | | | | 513,621 | | | | | | 4,625 | | | | | | 513,621 | | | | | | 211,688 | | |
Cash and cash equivalents at end of period
|
| | | $ | 3,197 | | | | | ¥ | 354,950 | | | | | ¥ | 225,060 | | | | | $ | 12,965 | | | | | ¥ | 1,439,733 | | | | | ¥ | 513,621 | | |
|
(in thousands JPY)
|
| |
Payments due by period:
|
| |||||||||||||||||||||
|
Total
|
| |
Less than 1 year
|
| |
1−3 years
|
| |
More than 3 years
|
| ||||||||||||||
Debt obligations
|
| | | | 755,159 | | | | | | 181,884 | | | | | | 119,799 | | | | | | 453,476 | | |
Operating lease obligations
|
| | | | 1,840,331 | | | | | | 752,770 | | | | | | 765,946 | | | | | | 321,615 | | |
Other obligations
|
| | | | 9,721 | | | | | | 2,005 | | | | | | 4,010 | | | | | | 3,706 | | |
Total
|
| | | | 2,605,211 | | | | | | 936,659 | | | | | | 889,755 | | | | | | 778,797 | | |
Name
|
| |
Age
|
| |
Position(s) with our Company
|
|
Kouji Eguchi | | |
48
|
| | Chief Executive Officer and Representative Director | |
Fumitoshi Fujiwara | | |
56
|
| | Chief Financial Officer and Director | |
Akira Nojima | | |
57
|
| | Independent Director | |
Tomoya Ogawa | | |
45
|
| | Independent Director | |
Tsukasa Karyu* | | |
66
|
| | Corporate Auditor | |
Osamu Sato* | | |
61
|
| | Corporate Auditor | |
Minekazu Shimada* | | |
65
|
| | Corporate Auditor | |
(in thousands, except stock options and number of persons in category)
Category of directors and corporate auditors |
| |
Total amount
of remuneration |
| |
Base compensation
|
| |
Number of
persons in category |
| |||||||||
Executive directors(1)
|
| | | ¥ | 61,366 | | | | | ¥ | 61,366 | | | | | | 3 | | |
Outside directors(2)
|
| | | | — | | | | | | — | | | | | | 2 | | |
Full-time corporate auditor(3)
|
| | | ¥ | 4,800 | | | | | ¥ | 4,800 | | | | | | 1 | | |
Outside corporate auditors(4)
|
| | | ¥ | 1,200 | | | | | ¥ | 1,200 | | | | | | 2 | | |
Name of Issuance
|
| |
Issuance Date
|
| |
Expiration Date
|
| |
Exercise Price
(per share) |
| |
Number of
Common Shares Granted |
| ||||||||||||
Fifth Series
|
| | | | 12/24/2015 | | | | | | 12/21/2025 | | | | | ¥ | 400 | | | | | | 285,500 | | |
Seventh Series
|
| | | | 12/22/2016 | | | | | | 12/21/2026 | | | | | ¥ | 2,000 | | | | | | 174,000 | | |
Eighth Series
|
| | | | 10/30/2020 | | | | | | 9/30/2026 | | | | | ¥ | 2,000 | | | | | | 150,000 | | |
Ninth Series(1)
|
| | | | 10/30/2020 | | | | | | 9/30/2024 | | | | | ¥ | 128 | | | | | | 300,000 | | |
Name
|
| |
Grant Date
|
| |
Beginning of
Exercise Period |
| |
End of
Exercise Period |
| |
Exercise
Price (per share) |
| |
Total
Number of Stock Options Granted |
| |
Total Number
of Common Shares Underlying Stock Options |
| ||||||||||||||||||
Tomoya Ogawa
|
| | | | 12/24/2015 | | | | | | 12/22/2017 | | | | | | 12/21/2025 | | | | | ¥ | 400 | | | | | | 25(1) | | | | | | 12,500 | | |
Kouji Eguchi
|
| | | | 10/30/2020 | | | | | | 10/1/2021 | | | | | | 9/30/2026 | | | | | ¥ | 2,000 | | | | | | 150,000(2) | | | | | | 150,000 | | |
Fumitoshi Fujiwara
|
| | | | 10/30/2020 | | | |
(3)
|
| | | | 9/30/2024 | | | | | ¥ | 128 | | | | | | 40,000(2) | | | | | | 40,000 | | |
| | |
Common Shares
Beneficially Owned immediately prior to the consummation of this offering(1) |
| |
Common Shares
beneficially owned immediately after the consummation of this offering(1) |
| ||||||||||||||||||
Name of Beneficial Owner
|
| |
Shares
|
| |
Percentage
|
| |
Shares
|
| |
Percentage
|
| ||||||||||||
Named Executive Officers, Directors, and Corporate Auditors: | | | | ||||||||||||||||||||||
Kouji Eguchi(2)
|
| | | | 2,034,960 | | | | | | 39.20% | | | | | | 2,034,960 | | | | | | 33.97% | | |
Fumitoshi Fujiwara
|
| | | | 40,000 | | | | | | * | | | | | | 40,000 | | | | | | * | | |
Akira Nojima
|
| | | | — | | | | | | * | | | | | | — | | | | | | * | | |
Tomoya Ogawa(3)
|
| | | | 41,000 | | | | | | * | | | | | | 41,000 | | | | | | * | | |
Minekazu Shimada
|
| | | | — | | | | | | * | | | | | | — | | | | | | * | | |
Tsukasa Karyu
|
| | | | — | | | | | | * | | | | | | — | | | | | | * | | |
Osamu Sato
|
| | | | 17,500 | | | | | | * | | | | | | 17,500 | | | | | | * | | |
All named executive officers, directors, and corporate auditors as a group (seven persons)
|
| | | | 2,133,460 | | | | | | 41.10% | | | | | | 2,133,460 | | | | | | 35.61% | | |
5% or more Shareholders: | | | | | | | | | | | | | | | | | | | | | | | | | |
Kouji Eguchi(2)
|
| | | | 2,034,960 | | | | | | 39.20% | | | | | | 2,034,960 | | | | | | 33.97% | | |
|
Persons depositing or withdrawing common
shares or ADS holders must pay: |
| |
For:
|
|
| $5.00 (or less) per 100 ADSs (or portion of 100 ADSs) | | | Issuance of ADSs, including issuances resulting from a distribution of shares or rights or other property Cancellation of ADSs for the purpose of withdrawal, including if the deposit agreement terminates | |
| $.05 (or less) per ADS | | | Any cash distribution to ADS holders | |
| A fee equivalent to the fee that would be payable if securities distributed to you had been common shares and the common shares had been deposited for issuance of ADSs | | | Distribution of securities distributed to holders of deposited securities (including rights) that are distributed by the depositary to ADS holders | |
| $.05 (or less) per ADS per calendar year | | | Depositary services | |
| Registration or transfer fees | | | Transfer and registration of shares on our share register to or from the name of the depositary or its agent when you deposit or withdraw shares | |
| Expenses of the depositary | | | Cable (including SWIFT) and facsimile transmissions (when expressly provided in the deposit agreement) Converting foreign currency to U.S. dollars | |
| Taxes and other governmental charges the depositary or the custodian has to pay on any ADSs or common shares underlying ADSs, such as stock transfer taxes, stamp duty or withholding taxes | | | As necessary | |
| Any charges incurred by the depositary or its agents for servicing the deposited securities | | | As necessary | |
Name
|
| |
Number
of ADSs |
| |||
Maxim Group LLC
|
| | | | • | | |
• | | | | | • | | |
• | | | | | • | | |
• | | | | | • | | |
Total
|
| | | | 800,000 | | |
Underwriting Discounts and Commissions
|
| |
With no exercise of
the option to purchase additional ADSs |
| |
With full exercise
of the option to purchase additional ADSs |
|
Per ADS
|
| |
US$•
|
| |
US$•
|
|
Total
|
| |
US$•
|
| |
US$•
|
|
Description
|
| |
Amount
|
| |||
U.S. Securities and Exchange Commission registration fee
|
| | | $ | 572 | | |
Financial Industry Regulatory Authority filing fee
|
| | | | 1,425 | | |
Accounting fees and expenses
|
| | | | 137,196 | | |
Legal fees and expenses
|
| | | | 248,200 | | |
Roadshow expenses
|
| | | | 55,126 | | |
Printing expenses
|
| | | | 46,425 | | |
Total
|
| | | $ | 488,944 | | |
| | | | | F-2 | | | |
| | | | | F-3 | | | |
| | | | | F-4 | | | |
| | | | | F-5 | | | |
| | | | | F-6 | | | |
| | | | | F-7 | | | |
| | | | | F-9 | | |
| | | | | F-45 | | | |
| | | | | F-46 | | | |
| | | | | F-47 | | | |
| | | | | F-48 | | | |
| | | | | F-50 | | |
| | |
December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
ASSETS | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | ¥ | 1,439,733 | | | | | ¥ | 513,621 | | |
Time deposits
|
| | | | 32,524 | | | | | | 38,520 | | |
Accounts receivable-trade, net
|
| | | | 148,540 | | | | | | 337,048 | | |
Accounts receivable-other
|
| | | | 411,278 | | | | | | 428,278 | | |
Due from shareholder
|
| | | | ― | | | | | | 8,266 | | |
Inventories
|
| | | | 7,956 | | | | | | 5,511 | | |
Prepaid expenses and other current assets
|
| | | | 47,193 | | | | | | 47,485 | | |
Total current assets
|
| | | | 2,087,224 | | | | | | 1,378,729 | | |
Property and equipment, net
|
| | | | 235,930 | | | | | | 168,955 | | |
Goodwill
|
| | | | 150,720 | | | | | | 78,282 | | |
Other intangible assets, net
|
| | | | 97,615 | | | | | | 77,638 | | |
Investments
|
| | | | 500 | | | | | | 14,044 | | |
Long-term accounts receivable-other, net
|
| | | | 116,942 | | | | | | 106,208 | | |
Right-of-use asset – operating lease, net
|
| | | | 1,578,828 | | | | | | 1,829,968 | | |
Lease and guarantee deposits
|
| | | | 710,636 | | | | | | 769,104 | | |
Deferred tax assets, net
|
| | | | 655,591 | | | | | | 222,505 | | |
Deferred offering costs
|
| | | | ― | | | | | | 57,509 | | |
Other assets
|
| | | | 79,480 | | | | | | 54,523 | | |
Total assets
|
| | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | ¥ | 67,016 | | | | | ¥ | 122,590 | | |
Accrued expenses
|
| | | | 889,112 | | | | | | 447,974 | | |
Short-term borrowings and current portion of long-term borrowings
|
| | | | 242,281 | | | | | | 371,570 | | |
Accrued income taxes
|
| | | | 43,198 | | | | | | 17,834 | | |
Contract liability (current)
|
| | | | 172,063 | | | | | | ― | | |
Advances received
|
| | | | 461,665 | | | | | | 483,124 | | |
Short-term lease liability
|
| | | | 658,320 | | | | | | 704,024 | | |
Other current liabilities
|
| | | | 118,933 | | | | | | 115,573 | | |
Total current liabilities
|
| | | | 2,652,588 | | | | | | 2,262,689 | | |
Long-term borrowings – net of current portion
|
| | | | 668,380 | | | | | | 150,531 | | |
Deposit received
|
| | | | 375,463 | | | | | | 474,388 | | |
Long-term contract liability – net of current portion
|
| | | | 333,978 | | | | | | ― | | |
Long-term lease liability – net of current portion
|
| | | | 992,892 | | | | | | 1,136,799 | | |
Asset retirement obligation
|
| | | | 191,192 | | | | | | 127,411 | | |
Other liabilities
|
| | | | 7,716 | | | | | | 5,589 | | |
Total liabilities
|
| | | | 5,222,209 | | | | | | 4,157,407 | | |
COMMITMENTS AND CONTINGENCIES (NOTE 18) | | | | | | | | | | | | | |
SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | |
Common stock, no par value; 9,999,999 shares authorized; 4,915,000 shares issued and 4,822,500 shares outstanding at December 31, 2020; 4,115,000 shares issued and 4,022,500 shares outstanding at December 31, 2019
|
| | | | 1,179,313 | | | | | | 595,000 | | |
Class A common stock, no par value; 1 share authorized; 1 share issued and 1 share outstanding at
December 31, 2020 and 2019 |
| | | | 100 | | | | | | 100 | | |
Treasury stock, at cost- 92,500 common shares at December 31, 2020 and 2019
|
| | | | (3,000) | | | | | | (3,000) | | |
Additional paid-in capital
|
| | | | 1,018,146 | | | | | | 713,267 | | |
Accumulated deficit
|
| | | | (1,703,302) | | | | | | (705,309) | | |
Total shareholders’ equity
|
| | | | 491,257 | | | | | | 600,058 | | |
Total liabilities and shareholders’ equity
|
| | | ¥ | 5,713,466 | | | | | ¥ | 4,757,465 | | |
| | |
Years Ended December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Revenues: | | | | | | | | | | | | | |
Revenue from directly-operated salons
|
| | | ¥ | 2,026,806 | | | | | ¥ | 2,031,155 | | |
Franchise revenue
|
| | | | 1,289,141 | | | | | | 1,833,501 | | |
Other revenues
|
| | | | 25,670 | | | | | | 43,608 | | |
Total revenues
|
| | | | 3,341,617 | | | | | | 3,908,264 | | |
Cost of revenues and operating expenses: | | | | | | | | | | | | | |
Cost of revenue from directly-operated salons
|
| | | | 2,149,843 | | | | | | 1,912,893 | | |
Cost of franchise revenue
|
| | | | 745,102 | | | | | | 1,019,956 | | |
Cost of other revenues
|
| | | | 17,722 | | | | | | 24,657 | | |
Selling, general and administrative expenses
|
| | | | 1,068,537 | | | | | | 871,862 | | |
Impairment loss on long-lived assets
|
| | | | 106,501 | | | | | | 44,546 | | |
Total cost of revenues and operating expenses
|
| | | | 4,087,705 | | | | | | 3,873,914 | | |
Operating (loss) income
|
| | | | (746,088) | | | | | | 34,350 | | |
Other income (expense): | | | | | | | | | | | | | |
Dividend income
|
| | | | 2 | | | | | | 2 | | |
Interest income
|
| | | | 1,332 | | | | | | 1,336 | | |
Interest expense
|
| | | | (13,234) | | | | | | (13,591) | | |
Gain from bargain purchases
|
| | | | ― | | | | | | 6,487 | | |
Subsidies
|
| | | | 111,581 | | | | | | ― | | |
Other, net
|
| | | | 19,718 | | | | | | 4,153 | | |
Total other income (expense)
|
| | | | 119,399 | | | | | | (1,613) | | |
(Loss) income before income tax (benefit) expense and equity in earnings of investment
|
| | | | (626,689) | | | | | | 32,737 | | |
Income tax (benefit) expense
|
| | | | (87,519) | | | | | | 15,961 | | |
Equity in earnings of investment
|
| | | | ― | | | | | | 559 | | |
Net (loss) income
|
| | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Net (loss) earnings per share | | | | | | | | | | | | | |
Basic
|
| | | ¥ | (133.97) | | | | | ¥ | 4.63 | | |
Diluted
|
| | | ¥ | (133.97) | | | | | ¥ | 4.06 | | |
Weighted average shares outstanding | | | | | | | | | | | | | |
Basic
|
| | | | 4,024,692 | | | | | | 3,747,296 | | |
Diluted
|
| | | | 4,024,692 | | | | | | 4,272,302 | | |
| | |
Years Ended December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Net (loss) income
|
| | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Foreign currency translation adjustments, net of tax
|
| | | | ― | | | | | | 278 | | |
Comprehensive (loss) income
|
| | | ¥ | (539,170) | | | | | ¥ | 17,613 | | |
| | |
Common stock
|
| |
Class A
common stock |
| |
Treasury stock
|
| |
Additional
paid-in capital |
| |
Accumulated
other comprehensive income (loss) |
| |
Accumulated
deficit |
| |
Total
|
| |||||||||||||||||||||||||||||||||||||||
|
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| ||||||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2018
|
| | | | 3,765,000 | | | | | ¥ | 245,000 | | | | | | 1 | | | | | ¥ | 100 | | | | | | 92,500 | | | | | ¥ | (3,000) | | | | | ¥ | 363,267 | | | | | ¥ | (278) | | | | | ¥ | (722,644) | | | | | ¥ | (117,555) | | |
Issuance of common shares for cash
|
| | | | 350,000 | | | | | | 350,000 | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | 350,000 | | | | | | ― | | | | | | ― | | | | | | 700,000 | | |
Net income
|
| | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | 17,335 | | | | | | 17,335 | | |
Foreign currency translation adjustments
|
| | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | 278 | | | | | | ― | | | | | | 278 | | |
Balance, December 31, 2019
|
| | | | 4,115,000 | | | | | | 595,000 | | | | | | 1 | | | | | | 100 | | | | | | 92,500 | | | | | | (3,000) | | | | | | 713,267 | | | | | | ― | | | | | | (705,309) | | | | | | 600,058 | | |
Cumulative effect of adoption of ASC 606 (Note 1)
|
| | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | (458,823) | | | | | | (458,823) | | |
Issuance of common stock upon initial public offering, net of offering costs and tax (Note 1)
|
| | | | 800,000 | | | | | | 584,313 | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | 304,879 | | | | | | ― | | | | | | ― | | | | | | 889,192 | | |
Net loss
|
| | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | ― | | | | | | (539,170) | | | | | | (539,170) | | |
Balance, December 31, 2020
|
| | | | 4,915,000 | | | | | ¥ | 1,179,313 | | | | | | 1 | | | | | ¥ | 100 | | | | | | 92,500 | | | | | ¥ | (3,000) | | | | | ¥ | 1,018,146 | | | | | ¥ | ― | | | | | ¥ | (1,703,302) | | | | | ¥ | 491,257 | | |
| | |
Years Ended December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Cash flows from operating activities: | | | | | | | | | | | | | |
Net (loss) income
|
| | | ¥ | (539,170) | | | | | ¥ | 17,335 | | |
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:
|
| | | | | | | | | | | | |
Depreciation and amortization
|
| | | | 62,290 | | | | | | 46,174 | | |
Losses on sales of directly-operated salons to franchisees
|
| | | | ― | | | | | | 9,600 | | |
Allowance for doubtful accounts
|
| | | | (11,376) | | | | | | 271 | | |
Impairment loss on investments
|
| | | | 10,544 | | | | | | ― | | |
Losses on disposal of property and equipment, net and other intangible assets,
net |
| | | | 33,841 | | | | | | 4,631 | | |
Impairment loss on long-lived assets
|
| | | | 106,501 | | | | | | 44,546 | | |
Gain from bargain purchases
|
| | | | ― | | | | | | (6,487) | | |
Deferred income tax (benefit) expense
|
| | | | (107,264) | | | | | | 5,739 | | |
Other non-cash (gains) expense – net
|
| | | | 1,903 | | | | | | (895) | | |
Changes in operating assets and liabilities:
|
| | | | | | | | | | | | |
Accounts receivable-trade, net
|
| | | | 189,143 | | | | | | (66,877) | | |
Accounts receivable-other
|
| | | | (48,031) | | | | | | (36,190) | | |
Inventories
|
| | | | (2,445) | | | | | | 892 | | |
Prepaid expenses and other current assets
|
| | | | (8,167) | | | | | | (39,698) | | |
Lease and guarantee deposits
|
| | | | 58,468 | | | | | | (14,163) | | |
Accounts payable
|
| | | | (55,574) | | | | | | (18,729) | | |
Accrued expenses
|
| | | | 206,706 | | | | | | 116,856 | | |
Accrued income taxes
|
| | | | 25,364 | | | | | | 4,200 | | |
Contract liability
|
| | | | (160,595) | | | | | | ― | | |
Advances received
|
| | | | (15,322) | | | | | | (39,177) | | |
Other current liabilities
|
| | | | (3,389) | | | | | | 10,226 | | |
Deposit received
|
| | | | (98,925) | | | | | | (20,871) | | |
Other assets and other liabilities – net
|
| | | | (10,922) | | | | | | (9,513) | | |
Net cash (used in) provided by operating activities
|
| | | | (366,420) | | | | | | 7,870 | | |
Cash flows from investing activities: | | | | | | | | | | | | | |
Purchases of time deposits
|
| | | | (26,703) | | | | | | (37,900) | | |
Proceeds from maturities of time deposits
|
| | | | 10,000 | | | | | | 6,000 | | |
Proceeds from sale of investments
|
| | | | 53,000 | | | | | | ― | | |
Acquisition of investment securities
|
| | | | ― | | | | | | (13,544) | | |
Acquisition of property and equipment
|
| | | | (73,556) | | | | | | (7,406) | | |
Proceeds from sale of property and equipment
|
| | | | 3,227 | | | | | | 5,000 | | |
Cost additions to internal use software
|
| | | | (30,569) | | | | | | (12,068) | | |
Acquisition of businesses – net of cash acquired
|
| | | | (99,195) | | | | | | (3,201) | | |
Proceeds from due from shareholder
|
| | | | 8,267 | | | | | | 8,412 | | |
Payment received on short-term loans receivable
|
| | | | 900 | | | | | | 450 | | |
Payment received on long-term accounts receivable-other, net
|
| | | | 15,030 | | | | | | 16,326 | | |
Net cash used in investing activities
|
| | | ¥ | (139,599) | | | | | ¥ | (37,931) | | |
| | |
Years Ended December 31,
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Cash flows from financing activities: | | | | | | | | | | | | | |
Proceeds from issuance of common stock in initial public offering – net of underwriting discounts and commissions
|
| | | ¥ | 1,168,627 | | | | | ¥ | ― | | |
Proceeds from issuance of common stock
|
| | | | ― | | | | | | 700,000 | | |
Net repayment of short-term borrowings
|
| | | | (180,000) | | | | | | ― | | |
Proceeds from long-term borrowings
|
| | | | 775,000 | | | | | | ― | | |
Repayment of long-term borrowings
|
| | | | (206,440) | | | | | | (234,411) | | |
Payment of installment payables related to business acquisitions
|
| | | | (33,949) | | | | | | (82,812) | | |
Payment of deferred offering costs
|
| | | | (97,857) | | | | | | (43,283) | | |
Repayment of corporate bonds
|
| | | | ― | | | | | | (7,500) | | |
Proceeds from issuance of stock options
|
| | | | 6,750 | | | | | | ― | | |
Net cash provided by financing activities
|
| | | | 1,432,131 | | | | | | 331,994 | | |
Net increase in cash and cash equivalents
|
| | | | 926,112 | | | | | | 301,933 | | |
Cash and cash equivalents at beginning of year
|
| | | | 513,621 | | | | | | 211,688 | | |
Cash and cash equivalents at end of year
|
| | | ¥ | 1,439,733 | | | | | ¥ | 513,621 | | |
Supplemental disclosure of cash flow information: | | | | | | | | | | | | | |
Cash paid during the year for:
|
| | | | | | | | | | | | |
Interest
|
| | | ¥ | 10,219 | | | | | ¥ | 11,872 | | |
Income taxes
|
| | | | 7,005 | | | | | | 24,344 | | |
Non-cash investing and financing activities:
|
| | | | | | | | | | | | |
Right-of-use assets obtained in exchange for lease liabilities
|
| | | | 604,703 | | | | | | 749,008 | | |
Purchases of property and equipment included in accrued expenses
|
| | | | 29,244 | | | | | | ― | | |
Purchases of intangible assets included in accrued expenses
|
| | | | 1,535 | | | | | | 3,321 | | |
Payables related to acquisition of businesses included in accrued expenses
|
| | | | 1,667 | | | | | | 48,901 | | |
Deferred offering costs included in accrued expenses
|
| | | | 261,619 | | | | | | 14,226 | | |
| | |
Number of
Relaxation Salons |
| |||||||||
| | | 2020 | | | | | | 2019 | | | ||
Directly-operated
|
| | | | 150 | | | | | | 107 | | |
Franchised
|
| | | | 140 | | | | | | 176 | | |
Total
|
| | | | 290 | | | | | | 283 | | |
|
Leasehold improvements
|
| |
Lesser of 15 years or the remaining lease term
|
|
|
Vehicles
|
| | 6 years | |
|
Tools, furniture and fixtures
|
| | 2-10 years | |
| | |
Thousands of Yen
|
| |||||||||||||||
|
As reported on
December 31, 2019 |
| |
Effect of
adoption of ASC 606 |
| |
As adjusted on
December 31, 2019 |
| |||||||||||
Assets: | | | | | | | | | | | | | | | | | | | |
Deferred tax assets, net
|
| | | | 222,505 | | | | | | 202,496 | | | | | | 425,001 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | |
Accrued expenses
|
| | | | 447,974 | | | | | | 820 | | | | | | 448,794 | | |
Contract liability (current)
|
| | | | ― | | | | | | 201,559 | | | | | | 201,559 | | |
Advances received
|
| | | | 483,124 | | | | | | (6,137) | | | | | | 476,987 | | |
Long-term contract liability – net of current portion
|
| | | | ― | | | | | | 465,077 | | | | | | 465,077 | | |
Shareholders’ equity: | | | | | | | | | | | | | | | | | | | |
Accumulated deficit
|
| | | ¥ | (705,309) | | | | | ¥ | (458,823) | | | | | ¥ | (1,164,132) | | |
| | |
Thousands of Yen
|
| |||||||||||||||
As of December 31, 2020
|
| |
As reported
|
| |
Adjusted
amount |
| |
Balances
without adoption |
| |||||||||
Assets: | | | | | | | | | | | | | | | | | | | |
Deferred tax assets, net
|
| | | ¥ | 655,591 | | | | | ¥ | (135,345) | | | | | ¥ | 520,246 | | |
Liabilities: | | | | | | | | | | | | | | | | | | | |
Accrued expenses
|
| | | | 889,112 | | | | | | (600) | | | | | | 888,512 | | |
Contract liability (current)
|
| | | | 172,063 | | | | | | (172,063) | | | | | | ― | | |
Advances received
|
| | | | 461,665 | | | | | | 26 | | | | | | 461,691 | | |
Long-term contract liability – net of current portion
|
| | | | 333,978 | | | | | | (333,978) | | | | | | ― | | |
Shareholders’ equity (deficit): | | | | | | | | | | | | | | | | | | | |
Accumulated deficit
|
| | | ¥ | (1,703,302) | | | | | ¥ | 371,270 | | | | | ¥ | (1,332,032) | | |
| | |
Thousands of Yen
|
| |||||||||||||||
Year ended December 31, 2020
|
| |
As reported
|
| |
Adjusted
amount |
| |
Balances
without adoption |
| |||||||||
Revenues
|
| | | ¥ | 3,341,617 | | | | | ¥ | (154,702) | | | | | ¥ | 3,186,915 | | |
Operating loss
|
| | | | (746,088) | | | | | | (154,702) | | | | | | (900,790) | | |
Loss before income tax
|
| | | | (626,689) | | | | | | (154,702) | | | | | | (781,391) | | |
Income tax benefit
|
| | | | (87,519) | | | | | | (67,151) | | | | | | (154,670) | | |
Net loss
|
| | | ¥ | (539,170) | | | | | ¥ | (87,551) | | | | | ¥ | (626,721) | | |
| | |
Thousands of Yen
|
| |||||||||||||||
Year ended December 31, 2020
|
| |
As reported
|
| |
Adjusted
amount |
| |
Balances
without adoption |
| |||||||||
Cash flows from operating activities: | | | | | | | | | | | | | | | | | | | |
Net loss
|
| | | ¥ | (539,170) | | | | | ¥ | (87,551) | | | | | ¥ | (626,721) | | |
Adjustments to reconcile net loss to net cash used in operating activities:
|
| | | | | | | | | | | | | | | | | | |
Deferred income tax expense
|
| | | | (107,264) | | | | | | (67,151) | | | | | | (174,415) | | |
Changes in operating assets and liabilities:
|
| | | | | | | | | | | | | | | | | | |
Accrued expenses
|
| | | | 206,706 | | | | | | 220 | | | | | | 206,926 | | |
Contract liability
|
| | | | (160,595) | | | | | | 160,595 | | | | | | ― | | |
Advances received
|
| | | | (15,322) | | | | | | (6,113) | | | | | | (21,435) | | |
Net cash used in operating activities
|
| | | ¥ | (366,420) | | | | | ¥ | ― | | | | | ¥ | (366,420) | | |
| | |
Thousands of Yen
|
| |||||||||
|
Fair value of assets/liabilities
|
| |||||||||||
|
2020
|
| |
2019
|
| ||||||||
Property and equipment – net
|
| | | ¥ | 51,005 | | | | | ¥ | 27,567 | | |
Goodwill
|
| | | | 72,438 | | | | | | 22,156 | | |
Intangible assets
|
| | | | 12,690 | | | | | | 6,519 | | |
Total assets acquired
|
| | | | 136,133 | | | | | | 56,242 | | |
Asset retirement obligation
|
| | | | (49,217) | | | | | | (25,942) | | |
Total liabilities assumed
|
| | | | (49,217) | | | | | | (25,942) | | |
Net assets assumed
|
| | | | 86,916 | | | | | | 30,300 | | |
Fair value of the consideration transferred
|
| | | | 86,916 | | | | | | 23,813 | | |
Gain from bargain purchases
|
| | | ¥ | ― | | | | | ¥ | 6,487 | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Leasehold improvements
|
| | | ¥ | 272,756 | | | | | ¥ | 215,524 | | |
Vehicles
|
| | | | 9,548 | | | | | | 7,786 | | |
Tools, furniture and fixtures
|
| | | | 37,480 | | | | | | 19,755 | | |
Total
|
| | | | 319,784 | | | | | | 243,065 | | |
Accumulated depreciation and amortization
|
| | | | (83,854) | | | | | | (74,110) | | |
| | | | ¥ | 235,930 | | | | | ¥ | 168,955 | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Intangible assets subject to amortization: | | | | | | | | | | | | | |
Software for internal use
|
| | | ¥ | 84,152 | | | | | ¥ | 54,710 | | |
Reacquired franchise rights
|
| | | | 17,973 | | | | | | 9,802 | | |
Other
|
| | | | 750 | | | | | | 10,750 | | |
Total
|
| | | | 102,875 | | | | | | 75,262 | | |
Accumulated amortization
|
| | | | (44,330) | | | | | | (36,694) | | |
Net carrying amount
|
| | | | 58,545 | | | | | | 38,568 | | |
Intangible assets not subject to amortization: | | | | | | | | | | | | | |
Trademark
|
| | | | 38,922 | | | | | | 38,922 | | |
Goodwill
|
| | | | 150,720 | | | | | | 78,282 | | |
Telephone rights
|
| | | | 148 | | | | | | 148 | | |
Total
|
| | | | 189,790 | | | | | | 117,352 | | |
Total intangible assets
|
| | | ¥ | 248,335 | | | | | ¥ | 155,920 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021
|
| | | ¥ | 24,019 | | |
2022
|
| | | | 17,857 | | |
2023
|
| | | | 9,540 | | |
2024
|
| | | | 6,034 | | |
2025
|
| | | | 957 | | |
Thereafter
|
| | | | 138 | | |
Total
|
| | | ¥ | 58,545 | | |
| | |
Thousands of Yen
|
| |||
Balance at December 31, 2018 | | | | | | | |
Goodwill
|
| | | ¥ | 63,955 | | |
Acquisitions of relaxation salons*
|
| | | | 22,156 | | |
Sales of directly-operated salons to franchisees, and disposal of relaxation salon
|
| | | | (7,829) | | |
Balance at December 31, 2019 | | | | | | | |
Goodwill
|
| | | | 78,282 | | |
Acquisitions of relaxation salons*
|
| | | | 72,438 | | |
Balance at December 31, 2020
|
| | | | | | |
Goodwill
|
| | | ¥ | 150,720 | | |
| | |
Carrying amount
|
| | | | ||||||||||||||||||
|
Thousands of Yen
|
| |
Ownership
|
| ||||||||||||||||||||
|
2020
|
| |
2019
|
| |
2020
|
| |
2019
|
| ||||||||||||||
Matrix Industries, Inc.
|
| | | ¥ | ― | | | | | ¥ | 5,544 | | | | | | 0.09% | | | | | | 14.3% | | |
Kabushiki Kaisha ReRaKu WEST
|
| | | | ― | | | | | | 3,000 | | | | | | ― | | | | | | 16.6% | | |
Other
|
| | | | 500 | | | | | | 5,500 | | | | | | ― | | | | | | ― | | |
Total
|
| | | ¥ | 500 | | | | | ¥ | 14,044 | | | | | | | | | | | | | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Unsecured bank loans (Due through 2035 with weighted average interest rates of 1.33% as of December 31, 2020, due through 2025 with weighted average interest rates of 1.74% as of December 31 2019)
|
| | | ¥ | 910,661 | | | | | ¥ | 342,101 | | |
Current portion of long-term borrowings
|
| | | | (242,281) | | | | | | (191,570) | | |
Total long-term borrowings
|
| | | ¥ | 668,380 | | | | | ¥ | 150,531 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021
|
| | | ¥ | 242,281 | | |
2022
|
| | | | 123,460 | | |
2023
|
| | | | 62,628 | | |
2024
|
| | | | 60,252 | | |
2025
|
| | | | 59,550 | | |
2026 and thereafter
|
| | | | 362,490 | | |
Total
|
| | | ¥ | 910,661 | | |
| | |
Thousands of Yen
|
| |||||||||
| | |
2020
|
| |
2019
|
| ||||||
Beginning balance
|
| | | ¥ | 127,411 | | | | | ¥ | 119,519 | | |
Liabilities incurred
|
| | | | 80,056 | | | | | | 63,623 | | |
Liabilities settled
|
| | | | (16,870) | | | | | | (55,954) | | |
Accretion expense
|
| | | | 595 | | | | | | 223 | | |
Ending balance
|
| | | ¥ | 191,192 | | | | | ¥ | 127,411 | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Fixed lease cost(a)
|
| | | ¥ | 748,230 | | | | | ¥ | 851,555 | | |
Variable lease cost(b)
|
| | | | 24,484 | | | | | | 30,901 | | |
Short-term cost
|
| | | | 11,669 | | | | | | 10,979 | | |
Total
|
| | | ¥ | 784,383 | | | | | ¥ | 893,435 | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Cash paid for amounts included in the measurement of lease liabilities: | | | | | | | | | | | | | |
Operating cash flows
|
| | | ¥ | 797,623 | | | | | ¥ | 375,270 | | |
Right-of-use assets obtained in exchange for lease liabilities
|
| | | | 604,703 | | | | | | 749,008 | | |
Weighted average remaining lease term (in years)
|
| | | | 2.8 | | | | | | 3.3 | | |
Weighted average discount rate
|
| | | | 1.45% | | | | | | 1.45% | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021
|
| | | ¥ | 667,823 | | |
2022
|
| | | | 493,800 | | |
2023
|
| | | | 246,751 | | |
2024
|
| | | | 122,654 | | |
2025
|
| | | | 70,448 | | |
2026 and thereafter
|
| | | | 98,245 | | |
Total
|
| | | | 1,699,721 | | |
Less: Interest component
|
| | | | (48,509) | | |
Present value of minimum lease payments
|
| | | ¥ | 1,651,212 | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Fixed sublease income
|
| | | ¥ | 478,225 | | | | | ¥ | 580,074 | | |
Variable sublease income
|
| | | | 14,146 | | | | | | 27,606 | | |
Total
|
| | | ¥ | 492,371 | | | | | ¥ | 607,680 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021
|
| | | ¥ | 376,993 | | |
2022
|
| | | | 276,765 | | |
2023
|
| | | | 152,356 | | |
2024
|
| | | | 66,450 | | |
2025
|
| | | | 33,728 | | |
2026 and thereafter
|
| | | | 20,488 | | |
Total
|
| | | ¥ | 926,780 | | |
| | |
Year ended
December 31, 2020 |
| |||
Expected term of option (in years)
|
| | | | 2 – 3 | | |
Expected volatility
|
| | | | 58.21 – 65.93% | | |
Expected dividend yield
|
| | | | —% | | |
Risk-free interest rate
|
| | | | 0.17 – 0.19% | | |
| | | | | | | | |
Yen
|
| |
Years
|
| |
Thousands of Yen
|
| |||||||||
| | |
Number of
shares |
| |
Weighted-average
exercise price |
| |
Weighted-average
remaining contractual term |
| |
Aggregate
intrinsic value |
| ||||||||||||
Outstanding at December 31, 2018
|
| | | | 549,500 | | | | | ¥ | 1,552 | | | | | | 7.6 | | | | | ¥ | ― | | |
Forfeited/Expired
|
| | | | (30,000) | | | | | | 800 | | | | | | | | | | | | | | |
Outstanding at December 31, 2019
|
| | | | 519,500 | | | | | | 1,595 | | | | | | 6.7 | | | | | | ― | | |
Exercisable at December 31, 2019
|
| | | | 519,500 | | | | | | 1,595 | | | | | | 6.7 | | | | | | ― | | |
Granted
|
| | | | 450,000 | | | | | | 752 | | | | | | ― | | | | | | | | |
Forfeited/Expired
|
| | | | (290,000) | | | | | | 1,903 | | | | | | | | | | | | | | |
Outstanding at December 31, 2020
|
| | | | 679,500 | | | | | | 905 | | | | | | 4.3 | | | | | | 531,518 | | |
Exercisable at December 31, 2020
|
| | | | 229,500 | | | | | ¥ | 1,205 | | | | | | 5.4 | | | | | ¥ | 123,891 | | |
| | |
Thousands of Yen
|
| |||||||||||||||||||||
| | |
Relaxation
Salon |
| |
Digital
Preventative Healthcare |
| |
Corporate
and elimination |
| |
Consolidated
|
| ||||||||||||
Year ended December 31, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues
|
| | | ¥ | 3,315,947 | | | | | ¥ | 25,670 | | | | | ¥ | ― | | | | | ¥ | 3,341,617 | | |
Operating income (loss)
|
| | | | (140,866) | | | | | | (66,100) | | | | | | (539,122) | | | | | | (746,088) | | |
Depreciation and amortization
|
| | | | 32,261 | | | | | | 8,007 | | | | | | 22,022 | | | | | | 62,290 | | |
Total assets
|
| | | | 3,096,094 | | | | | | 34,247 | | | | | | 2,583,125 | | | | | | 5,713,466 | | |
Year ended December 31, 2019 | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues
|
| | | ¥ | 3,864,656 | | | | | ¥ | 43,608 | | | | | ¥ | ― | | | | | ¥ | 3,908,264 | | |
Operating income (loss)
|
| | | | 279,439 | | | | | | (43,056) | | | | | | (202,033) | | | | | | 34,350 | | |
Depreciation and amortization
|
| | | | 34,025 | | | | | | 4,764 | | | | | | 7,385 | | | | | | 46,174 | | |
Total assets
|
| | | | 3,346,739 | | | | | | 29,565 | | | | | | 1,381,161 | | | | | | 4,757,465 | | |
| | |
Thousands of Yen
|
| |
Thousands of Yen
|
| ||||||||||||||||||
|
2020
|
| |
2019
|
| ||||||||||||||||||||
|
Domestic
|
| |
Total
|
| |
Domestic
|
| |
Total
|
| ||||||||||||||
(Loss) income before income taxes
|
| | | ¥ | (626,689) | | | | | ¥ | (626,689) | | | | | ¥ | 32,737 | | | | | ¥ | 32,737 | | |
Income taxes | | | | | | | | | | | | | | | | | | | | | | | | | |
Current
|
| | | | 19,745 | | | | | | 19,745 | | | | | | 10,222 | | | | | | 10,222 | | |
Deferred
|
| | | | (107,264) | | | | | | (107,264) | | | | | | 5,739 | | | | | | 5,739 | | |
Total
|
| | | ¥ | (87,519) | | | | | ¥ | (87,519) | | | | | ¥ | 15,961 | | | | | ¥ | 15,961 | | |
| | |
2020
|
| |
2019
|
| ||||||
Statutory tax rate
|
| | | | 30.6% | | | | | | 30.6% | | |
Increases (reductions) in taxes due to:
|
| | | | | | | | | | | | |
Change in valuation allowance
|
| | | | (13.2) | | | | | | (10.2) | | |
Nondeductible expenses
|
| | | | (0.3) | | | | | | 3.2 | | |
Inhabitant tax-per capita*
|
| | | | (3.2) | | | | | | 24.5 | | |
Other-net
|
| | | | 0.1 | | | | | | 0.7 | | |
Effective income tax rate
|
| | | | 14.0% | | | | | | 48.8% | | |
| | |
Thousands of Yen
|
| |||||||||
|
2020
|
| |
2019
|
| ||||||||
Deferred tax assets: | | | | | | | | | | | | | |
Accounts receivable-trade
|
| | | ¥ | 13,485 | | | | | ¥ | 13,485 | | |
Provision for bad debt
|
| | | | 41,700 | | | | | | 50,271 | | |
Goodwill
|
| | | | ― | | | | | | 1,135 | | |
Other prepaid expenses – currently not deductible
|
| | | | ― | | | | | | 54,235 | | |
Contract liability
|
| | | | 154,950 | | | | | | ― | | |
Asset retirement obligation
|
| | | | 58,543 | | | | | | 39,013 | | |
Operating lease liability
|
| | | | 505,601 | | | | | | 563,660 | | |
Operating loss carryforwards
|
| | | | 484,040 | | | | | | 95,490 | | |
Other
|
| | | | 60,392 | | | | | | 51,485 | | |
Gross deferred tax assets
|
| | | | 1,318,711 | | | | | | 868,774 | | |
Valuation allowance
|
| | | | (125,376) | | | | | | (42,395) | | |
Total deferred tax assets
|
| | | | 1,193,335 | | | | | | 826,379 | | |
Deferred tax liabilities: | | | | | | | | | | | | | |
Property and equipment
|
| | | | (32,433) | | | | | | (18,141) | | |
Goodwill
|
| | | | (4,073) | | | | | | | | |
Intangible assets
|
| | | | (15,285) | | | | | | (6,485) | | |
Right-of-use asset – operating lease
|
| | | | (483,437) | | | | | | (560,336) | | |
Deferred offering costs
|
| | | | ― | | | | | | (17,609) | | |
Advances received
|
| | | | (1,311) | | | | | | (1,303) | | |
Other
|
| | | | (1,205) | | | | | | ― | | |
Total deferred tax liabilities
|
| | | | (537,744) | | | | | | (603,874) | | |
Net deferred tax assets
|
| | | ¥ | 655,591 | | | | | ¥ | 222,505 | | |
| | |
Operating loss
carryforwards |
| |||
| | |
(Thousands of Yen)
|
| |||
Years ending December 31: | | | | | | | |
Between 2021 and 2024
|
| | | ¥ | 75,596 | | |
Between 2025 and 2028
|
| | | | 132,439 | | |
2029 and thereafter
|
| | | | 1,372,760 | | |
Total
|
| | | ¥ | 1,580,795 | | |
| | |
Thousands of Yen
|
| |||||||||||||||
Revenue Stream*
|
| |
Relaxation Salon
|
| |
Digital
Preventative Healthcare |
| |
Consolidated
|
| |||||||||
Year ended December 31, 2020 | | | | | | | | | | | | | | | | | | | |
Revenue from directly-operated salons
|
| | | ¥ | 2,026,806 | | | | | ¥ | ― | | | | | ¥ | 2,026,806 | | |
Franchise fees
|
| | | | 175,445 | | | | | | ― | | | | | | 175,445 | | |
Royalty income
|
| | | | 179,745 | | | | | | ― | | | | | | 179,745 | | |
Staffing service revenue
|
| | | | 254,282 | | | | | | ― | | | | | | 254,282 | | |
Sublease revenue
|
| | | | 492,371 | | | | | | ― | | | | | | 492,371 | | |
Other franchise revenues
|
| | | | 187,298 | | | | | | ― | | | | | | 187,298 | | |
Other revenues
|
| | | | ― | | | | | | 25,670 | | | | | | 25,670 | | |
Total revenues
|
| | | ¥ | 3,315,947 | | | | | ¥ | 25,670 | | | | | ¥ | 3,341,617 | | |
| | |
Thousands of Yen
|
| | | | |||||||||
| | |
As of
December 31, 2020 |
| |
As of
December 31, 2019 (as adjusted- Note 1) |
| |
Balance sheet classification
|
| ||||||
Receivables
|
| | | ¥ | 148,540 | | | | | ¥ | 337,048 | | | | Accounts receivable-trade, net | |
Contract liabilities: | | | | | | | | | | | | | | | | |
Current
|
| | | | 172,063 | | | | | | 201,559 | | | | Contract liability (current) | |
Long-term
|
| | | | 333,978 | | | | | | 465,077 | | | |
Long-term contract liability – net
of current portion |
|
Total
|
| | | ¥ | 506,041 | | | | | ¥ | 666,636 | | | | | |
| | |
Thousands of Yen
Contract liabilities |
| |||
Balance at December 31, 2019 as adjusted (Note 1)
|
| | | ¥ | 666,636 | | |
Revenues recognized during 2020 which were included in the contract liabilities balance at
December 31, 2019 |
| | | | (203,970) | | |
Remaining amounts at December 31, 2020 which were newly recognized as contract liabilities during 2020
|
| | | | 43,375 | | |
Balance at December 31, 2020
|
| | | ¥ | 506,041 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021
|
| | | ¥ | 172,063 | | |
2022
|
| | | | 90,313 | | |
2023
|
| | | | 88,310 | | |
2024
|
| | | | 79,168 | | |
2025
|
| | | | 53,558 | | |
2026 and thereafter
|
| | | | 34,730 | | |
Total
|
| | | ¥ | 518,142 | | |
| | |
Thousands of Yen
|
| |||||||||||||||
| | |
Before Tax
Amount |
| |
Tax
(Expense) Benefit |
| |
Net of Tax
Amount |
| |||||||||
Year ended December 31, 2019 | | | | | | | | | | | | | | | | | | | |
Foreign currency translation adjustments
|
| | | | | | | | | | | | | | | | | | |
Amount arising during the period
|
| | | ¥ | ― | | | | | ¥ | ― | | | | | ¥ | ― | | |
Reclassification adjustments for gains and losses realized in net income
|
| | | | 400 | | | | | | (122) | | | | | | 278 | | |
Other comprehensive income (loss)
|
| | | ¥ | 400 | | | | | ¥ | (122) | | | | | ¥ | 278 | | |
| | |
Thousands of Yen
|
| |||
|
Foreign currency
translation adjustments |
| |||||
Balance at December 31, 2018
|
| | | ¥ | (278) | | |
Other comprehensive income (loss) before reclassifications
|
| | | | ― | | |
Amounts reclassified from accumulated other comprehensive income (loss)
|
| | | | 278 | | |
Net change during the year
|
| | | | 278 | | |
Balance at December 31, 2019
|
| | | ¥ | ― | | |
| | |
Thousands of Yen
|
| |
Affected line items
in consolidated statements of (loss) income |
| |||||||||
|
2020
|
| |
2019
|
| |||||||||||
Foreign currency translation adjustments
|
| | | ¥ | ― | | | | | ¥ | 400 | | | | Other – net | |
| | | | | ― | | | | | | (122) | | | |
Income tax (benefit) expense
|
|
| | | | | ― | | | | | | 278 | | | | Net (loss) income | |
Total amount reclassified, net of tax
|
| | | ¥ | ― | | | | | ¥ | 278 | | | | | |
| | |
2020
|
| |
2019
|
| ||||||||||||||||||
| | |
Common
|
| |
Class A
|
| |
Common
|
| |
Class A
|
| ||||||||||||
| | |
(Yen)
|
| |
(Yen)
|
| ||||||||||||||||||
Income (Numerator) | | | | | | | | | | | | | | | | | | | | | | | | | |
Net (loss) income attributable to shareholders of the Company
|
| | ¥(539,170) | | | | | ― | | | | | ¥ | 17,335 | | | | | | ― | | | |||
Shares (Denominator) | | |
(Number of shares)
|
| |
(Number of shares)
|
| ||||||||||||||||||
Weighted average common shares outstanding
|
| | | | 4,024,692 | | | | | | 1 | | | | | | 3,747,295 | | | | | | 1 | | |
Effect of dilutive instruments: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stock options
|
| | | | ― | | | | | | ― | | | | | | 525,007 | | | | | | ― | | |
Weighted average common shares for diluted
computation |
| | | | 4,024,692 | | | | | | 1 | | | | | | 4,272,302 | | | | | | 1 | | |
(Loss) earnings per common share attributable to shareholders of the Company
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Basic
|
| | ¥(133.97) | | | | ¥ | (133.97) | | | | | ¥ | 4.63 | | | | | ¥ | 4.63 | | | |||
Diluted
|
| | ¥(133.97) | | | | ¥ | (133.97) | | | | | ¥ | 4.06 | | | | | ¥ | 4.06 | | |
| | |
Thousands of Yen
|
| |||||||||||||||||||||
|
2020
|
| |
2019
|
| ||||||||||||||||||||
|
Carrying
amount |
| |
Estimated
fair value |
| |
Carrying
amount |
| |
Estimated
fair value |
| ||||||||||||||
Long-term borrowings – net of current portion
|
| | | ¥ | (668,380) | | | | | ¥ | (644,499) | | | | | ¥ | (150,531) | | | | | ¥ | (145,600) | | |
| | |
Thousands of Yen
|
| |||||||||||||||||||||
|
Level 1
|
| |
Level 2
|
| |
Level 3
|
| |
Impairment
loss |
| ||||||||||||||
Year ended December 31, 2020 | | | | | | | | | | | | | | | | | | | | | | | | | |
Assets
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Leasehold improvements
|
| | | ¥ | ― | | | | | ¥ | ― | | | | | ¥ | 213,314 | | | | | ¥ | 36,512 | | |
Right-of-use asset – operating lease
|
| | | | ― | | | | | | ― | | | | | | 1,578,828 | | | | | | 69,989 | | |
Total
|
| | | ¥ | ― | | | | | ¥ | ― | | | | | ¥ | 1,792,142 | | | | | ¥ | 106,501 | | |
Year ended December 31, 2019 | | | | | | | | | | | | | | | | | | | | | | | | | |
Assets
|
| | | | | | | | | | | | | | | | | | | | | | | | |
Leasehold improvements
|
| | | ¥ | ― | | | | | ¥ | ― | | | | | ¥ | 161,330 | | | | | ¥ | 9,825 | | |
Right-of-use asset – operating lease
|
| | | | ― | | | | | | ― | | | | | | 1,829,968 | | | | | | 34,721 | | |
Total
|
| | | ¥ | ― | | | | | ¥ | ― | | | | | ¥ | 1,991,298 | | | | | ¥ | 44,546 | | |
| | | | | F-45 | | | |
| | | | | F-46 | | | |
| | | | | F-47 | | | |
| | | | | F-48 | | | |
| | | | | F-50 | | |
| | |
June 30,
2021 |
| |
December 31,
2020 |
| ||||||
| | | | | (Unaudited) | | | | | | | | |
ASSETS | | | | | | | | | | | | | |
Current assets: | | | | | | | | | | | | | |
Cash and cash equivalents
|
| | | ¥ | 354,950 | | | | | ¥ | 1,439,733 | | |
Accounts receivable-trade, net of allowances of ¥5,484 and ¥4,426, respectively
|
| | | | 89,416 | | | | | | 148,540 | | |
Accounts receivable-other
|
| | | | 305,851 | | | | | | 411,278 | | |
Inventories
|
| | | | 10,904 | | | | | | 7,956 | | |
Prepaid expenses and other current assets
|
| | | | 111,057 | | | | | | 79,717 | | |
Total current assets
|
| | | | 872,178 | | | | | | 2,087,224 | | |
Property and equipment, net
|
| | | | 330,692 | | | | | | 235,930 | | |
Goodwill
|
| | | | 535,246 | | | | | | 150,720 | | |
Other intangible assets, net
|
| | | | 91,036 | | | | | | 97,615 | | |
Investments
|
| | | | 53,020 | | | | | | 500 | | |
Long-term accounts receivable-other, net of allowances of ¥125,939 and ¥131,759, respectively
|
| | | | 115,247 | | | | | | 116,942 | | |
Right-of-use asset – operating lease, net
|
| | | | 1,709,722 | | | | | | 1,578,828 | | |
Lease and guarantee deposits
|
| | | | 784,796 | | | | | | 710,636 | | |
Deferred tax assets, net
|
| | | | 613,311 | | | | | | 655,591 | | |
Other assets
|
| | | | 94,768 | | | | | | 79,480 | | |
Total assets
|
| | | ¥ | 5,200,016 | | | | | ¥ | 5,713,466 | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | | | | | | |
Current liabilities: | | | | | | | | | | | | | |
Accounts payable
|
| | | ¥ | 62,244 | | | | | ¥ | 67,016 | | |
Accrued expenses
|
| | | | 814,390 | | | | | | 889,112 | | |
Current portion of long-term borrowings
|
| | | | 181,884 | | | | | | 242,281 | | |
Accrued income taxes
|
| | | | 13,211 | | | | | | 43,198 | | |
Contract liability (current)
|
| | | | 92,988 | | | | | | 172,063 | | |
Advances received
|
| | | | 438,482 | | | | | | 461,665 | | |
Short-term lease liability
|
| | | | 702,685 | | | | | | 658,320 | | |
Other current liabilities
|
| | | | 141,550 | | | | | | 118,933 | | |
Total current liabilities
|
| | | | 2,447,434 | | | | | | 2,652,588 | | |
Long-term borrowings – net of current portion
|
| | | | 573,275 | | | | | | 668,380 | | |
Deposit received
|
| | | | 340,525 | | | | | | 375,463 | | |
Long-term contract liability – net of current portion
|
| | | | 297,523 | | | | | | 333,978 | | |
Long-term lease liability – net of current portion
|
| | | | 1,059,530 | | | | | | 992,892 | | |
Asset retirement obligation
|
| | | | 256,967 | | | | | | 191,192 | | |
Other liabilities
|
| | | | 18,693 | | | | | | 7,716 | | |
Total liabilities
|
| | | | 4,993,947 | | | | | | 5,222,209 | | |
COMMITMENTS AND CONTINGENCIES (NOTE 12) | | | | | | | | | | | | | |
SHAREHOLDERS’ EQUITY: | | | | | | | | | | | | | |
Common stock, no par value; 19,899,999 shares authorized; 4,975,000 shares issued and 4,882,500
shares outstanding at June 30, 2021; 9,999,999 shares authorized; 4,915,000 shares issued and 4,822,500 shares outstanding at December 31, 2020 |
| | | | 1,223,134 | | | | | | 1,179,313 | | |
Class A common stock, no par value; 1 share authorized; 1 share issued and 1 share outstanding at June 30, 2021 and December 31, 2020
|
| | | | 100 | | | | | | 100 | | |
Treasury stock, at cost- 92,500 common shares at June 30, 2021 and December 31, 2020
|
| | | | (3,000) | | | | | | (3,000) | | |
Additional paid-in capital
|
| | | | 1,210,907 | | | | | | 1,018,146 | | |
Accumulated deficit
|
| | | | (2,225,072) | | | | | | (1,703,302) | | |
Total shareholders’ equity
|
| | | | 206,069 | | | | | | 491,257 | | |
Total liabilities and shareholders’ equity
|
| | | ¥ | 5,200,016 | | | | | ¥ | 5,713,466 | | |
| | |
Six months ended June 30,
|
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Revenues: | | | | | | | | | | | | | |
Revenue from directly-operated salons
|
| | | ¥ | 1,421,413 | | | | | ¥ | 751,267 | | |
Franchise revenue
|
| | | | 689,148 | | | | | | 593,236 | | |
Other revenues
|
| | | | 16,918 | | | | | | 11,774 | | |
Total revenues
|
| | | | 2,127,479 | | | | | | 1,356,277 | | |
Cost of revenues and operating expenses: | | | | | | | | | | | | | |
Cost of revenue from directly-operated salons
|
| | | | 1,415,685 | | | | | | 866,297 | | |
Cost of franchise revenue
|
| | | | 335,458 | | | | | | 394,906 | | |
Cost of other revenues
|
| | | | 17,764 | | | | | | 8,017 | | |
Selling, general and administrative expenses
|
| | | | 840,760 | | | | | | 521,364 | | |
Total cost of revenues and operating expenses
|
| | | | 2,609,667 | | | | | | 1,790,584 | | |
Operating loss
|
| | | | (482,188) | | | | | | (434,307) | | |
Other income: | | | | | | | | | | | | | |
Dividend income
|
| | | | 2 | | | | | | 2 | | |
Interest income
|
| | | | 506 | | | | | | 674 | | |
Interest expense
|
| | | | (6,683) | | | | | | (6,076) | | |
Gain from bargain purchases
|
| | | | 1,014 | | | | | | 1,624 | | |
Government subsidies
|
| | | | 1,065 | | | | | | 12,230 | | |
Other, net
|
| | | | 19,733 | | | | | | 1,912 | | |
Total other income
|
| | | | 15,637 | | | | | | 10,366 | | |
Loss before income tax expense
|
| | | | (466,551) | | | | | | (423,941) | | |
Income tax expense
|
| | | | 55,219 | | | | | | 19,030 | | |
Net loss
|
| | | ¥ | (521,770) | | | | | ¥ | (442,971) | | |
Net loss per share | | | | | | | | | | | | | |
Basic
|
| | | ¥ | (107.09) | | | | | ¥ | (110.12) | | |
Diluted
|
| | | ¥ | (107.09) | | | | | ¥ | (110.12) | | |
Weighted average shares outstanding | | | | | | | | | | | | | |
Basic
|
| | | | 4,872,224 | | | | | | 4,022,501 | | |
Diluted
|
| | | | 4,872,224 | | | | | | 4,022,501 | | |
| | |
Common stock
|
| |
Class A common stock
|
| |
Treasury stock
|
| |
Additional
paid-in capital |
| |
Accumulated
deficit |
| |
Total
|
| | | | ||||||||||||||||||||||||||||||||||||
|
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| |
Shares
|
| |
Amount
|
| | ||||||||||||||||||||||||||||||||||||||||
Balance, December 31, 2020
|
| | | | 4,915,000 | | | | | ¥ | 1,179,313 | | | | | | 1 | | | | | ¥ | 100 | | | | | | 92,500 | | | | | ¥ | (3,000) | | | | | ¥ | 1,018,146 | | | | | ¥ | (1,703,302) | | | | | ¥ | 491,257 | | | | ||
Issuance of common stock for
exercise of over-allotment, net of issuance costs |
| | | | 60,000 | | | | | | 43,821 | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 43,821 | | | | | | — | | | | | | 87,642 | | | | ||
Net loss
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | (521,770) | | | | | | (521,770) | | | | ||
Stock-based compensation
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | — | | | | | | 148,940 | | | | | | — | | | | | | 148,940 | | | | ||
Balance, June 30, 2021
|
| | | | 4,975,000 | | | | | ¥ | 1,223,134 | | | | | | 1 | | | | | ¥ | 100 | | | | | | 92,500 | | | | | ¥ | (3,000) | | | | | ¥ | 1,210,907 | | | | | ¥ | (2,225,072) | | | | | ¥ | 206,069 | | | |
| | |
Six months ended
June 30, |
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Cash flows from operating activities: | | | | | | | | | | | | | |
Net loss
|
| | | ¥ | (521,770) | | | | | ¥ | (442,971) | | |
Adjustments to reconcile net loss to net cash used in by operating activities:
|
| | | | | | | | | | | | |
Depreciation and amortization
|
| | | | 39,631 | | | | | | 33,105 | | |
Losses on sales of directly-operated salons to franchisees
|
| | | | 49 | | | | | | 65 | | |
Allowance for doubtful accounts
|
| | | | (4,860) | | | | | | (5,295) | | |
Stock-based compensation
|
| | | | 148,940 | | | | | | — | | |
Losses on disposal of property and equipment, net and other intangible assets, net
|
| | | | 1,967 | | | | | | 26,913 | | |
Gain from bargain purchases
|
| | | | (1,014) | | | | | | (1,624) | | |
Deferred income tax expense
|
| | | | 42,280 | | | | | | 11,046 | | |
Other non-cash gains – net
|
| | | | 847 | | | | | | 121 | | |
Changes in operating assets and liabilities:
|
| | | | | | | | | | | | |
Accounts receivable-trade, net
|
| | | | 72,839 | | | | | | 192,093 | | |
Accounts receivable-other
|
| | | | 108,981 | | | | | | 89,518 | | |
Inventories
|
| | | | (50) | | | | | | (369) | | |
Prepaid expenses and other current assets
|
| | | | (35,395) | | | | | | (37,422) | | |
Lease and guarantee deposits
|
| | | | (16,902) | | | | | | 84,323 | | |
Accounts payable
|
| | | | (8,303) | | | | | | (52,394) | | |
Accrued expenses
|
| | | | 106,131 | | | | | | (62,280) | | |
Accrued income taxes
|
| | | | (30,267) | | | | | | 3,105 | | |
Contract liability
|
| | | | (115,531) | | | | | | — | | |
Advances received
|
| | | | (96,535) | | | | | | (124,828) | | |
Other current liabilities
|
| | | | 597 | | | | | | (23,476) | | |
Deposit received
|
| | | | (34,938) | | | | | | (66,195) | | |
Other assets and other liabilities – net
|
| | | | (4,963) | | | | | | 1,704 | | |
Net cash used in operating activities
|
| | | | (348,266) | | | | | | (374,861) | | |
Cash flows from investing activities: | | | | | | | | | | | | | |
Purchases of time deposits
|
| | | | (13,201) | | | | | | (13,500) | | |
Proceeds from maturities of time deposits
|
| | | | — | | | | | | 10,000 | | |
Proceeds from sale of affiliated company securities
|
| | | | — | | | | | | 50,000 | | |
Acquisition of investment securities
|
| | | | (52,520) | | | | | | — | | |
Acquisition of property and equipment
|
| | | | (41,370) | | | | | | (70,803) | | |
Proceeds from sale of property and equipment
|
| | | | — | | | | | | 3,227 | | |
Cost additions to internal use software
|
| | | | (7,631) | | | | | | (9,492) | | |
Acquisition of businesses – net of cash acquired
|
| | | | (300,843) | | | | | | (42,393) | | |
Proceeds from due from shareholder
|
| | | | — | | | | | | 7,966 | | |
Payment received on short-term loans receivable
|
| | | | 225 | | | | | | 225 | | |
Payment received on long-term accounts receivable-other, net
|
| | | | 5,090 | | | | | | 7,515 | | |
Net cash used in investing activities
|
| | | ¥ | (410,250) | | | | | ¥ | (57,255) | | |
| | |
Six months ended June 30,
|
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Cash flows from financing activities: | | | | | | | | | | | | | |
Proceeds from issuance of common stock for exercise of over-allotment, net of
issuance costs |
| | | ¥ | 87,642 | | | | | ¥ | — | | |
Proceeds from long-term borrowings
|
| | | | — | | | | | | 330,000 | | |
Repayment of long-term borrowings
|
| | | | (155,502) | | | | | | (114,657) | | |
Payment of installment payables related to business acquisitions
|
| | | | (2,520) | | | | | | (30,199) | | |
Payment of deferred offering costs
|
| | | | (255,887) | | | | | | (41,589) | | |
Net cash (used in) provided by financing activities
|
| | | | (326,267) | | | | | | 143,555 | | |
Net decrease in cash and cash equivalents
|
| | | | (1,084,783) | | | | | | (288,561) | | |
Cash and cash equivalents at beginning of period
|
| | | | 1,439,733 | | | | | | 513,621 | | |
Cash and cash equivalents at end of period
|
| | | ¥ | 354,950 | | | | | ¥ | 225,060 | | |
Supplemental disclosure of cash flow information: | | | | | | | | | | | | | |
Cash paid during the period for:
|
| | | | | | | | | | | | |
Interest
|
| | | ¥ | 6,733 | | | | | ¥ | 4,896 | | |
Income taxes
|
| | | | 43,199 | | | | | | 4,953 | | |
Non-cash investing and financing activities:
|
| | | | | | | | | | | | |
Right-of-use assets obtained in exchange for lease liabilities
|
| | | | 490,342 | | | | | | 189,240 | | |
Purchases of property and equipment included in accrued expenses
|
| | | | 2,670 | | | | | | 9,548 | | |
Purchases of intangible assets included in accrued expenses
|
| | | | 2,325 | | | | | | — | | |
Payables related to acquisition of businesses included in accrued expenses
|
| | | | — | | | | | | 60,902 | | |
Deferred offering costs included in accrued expenses
|
| | | | — | | | | | | 26,476 | | |
| | |
Number of
Relaxation Salons |
| |||||||||
|
As of June 30,
2021 |
| |
As of December 31,
2020 |
| ||||||||
Directly-operated
|
| | | | 188 | | | | | | 150 | | |
Franchised
|
| | | | 125 | | | | | | 140 | | |
Total
|
| | | | 313 | | | | | | 290 | | |
| | |
Thousands of Yen
Fair value of assets/liabilities |
| |||
Cash and cash equivalents
|
| | | ¥ | 7,824 | | |
Accounts receivable, net
|
| | | | 18,228 | | |
Inventories
|
| | | | 2,898 | | |
Prepaid expenses and other current assets
|
| | | | 14,989 | | |
Property and equipment – net
|
| | | | 50,673 | | |
Goodwill
|
| | | | 218,138 | | |
Right-of-use asset-operating lease, net
|
| | | | 153,269 | | |
Other long-term assets
|
| | | | 57,323 | | |
Total assets acquired
|
| | | | 523,342 | | |
Accounts payable
|
| | | | (3,531) | | |
Accrued expenses
|
| | | | (97,279) | | |
Advances received
|
| | | | (73,353) | | |
Other current liabilities
|
| | | | (21,995) | | |
Lease liability
|
| | | | (151,197) | | |
Asset retirement obligation
|
| | | | (25,060) | | |
Other liabilities
|
| | | | (10,230) | | |
Total liabilities assumed
|
| | | | (382,645) | | |
Net assets assumed
|
| | | | 140,697 | | |
Fair value of the consideration transferred
|
| | | ¥ | 140,697 | | |
| | |
Thousands of Yen
|
| |||
Balance at December 31, 2020
|
| | | ¥ | 150,720 | | |
Acquisition of SAWAN’s shares
|
| | | | 218,138 | | |
Acquisitions of relaxation salons
|
| | | | 166,388 | | |
Balance at June 30, 2021
|
| | | ¥ | 535,246 | | |
| | |
Thousands of Yen
|
| |||||||||
| | |
As of
June 30, 2021 |
| |
As of
December 31, 2020 |
| ||||||
Bank loans (Due through 2035 with weighted average interest rates of 1.05% as of June 30, 2021, due through 2035 with weighted average interest rates of 1.33% as of December 31 2020)
|
| | | ¥ | 755,159 | | | | | ¥ | 910,661 | | |
Current portion of long-term borrowings
|
| | | | (181,884) | | | | | | (242,281) | | |
Total long-term borrowings
|
| | | ¥ | 573,275 | | | | | ¥ | 668,380 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021 (remainder)
|
| | | ¥ | 86,779 | | |
2022
|
| | | | 123,460 | | |
2023
|
| | | | 62,628 | | |
2024
|
| | | | 60,252 | | |
2025
|
| | | | 59,370 | | |
2026 and thereafter
|
| | | | 362,670 | | |
Total
|
| | | ¥ | 755,159 | | |
| | |
Thousands of Yen
|
| |||||||||
| | |
Six Months Ended June 30,
|
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Fixed lease cost(a)
|
| | | ¥ | 386,992 | | | | | ¥ | 372,769 | | |
Variable lease cost(b)
|
| | | | 13,789 | | | | | | 7,476 | | |
Short-term cost
|
| | | | 18,170 | | | | | | 4,458 | | |
Total
|
| | | ¥ | 418,951 | | | | | ¥ | 384,703 | | |
| | |
Thousands of Yen
|
| |||||||||
| | |
Six Months Ended June 30,
|
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Cash paid for amounts included in the measurement of lease liabilities: | | | | | | | | | | | | | |
Operating cash flows
|
| | | ¥ | 391,650 | | | | | ¥ | 99,758 | | |
Right-of-use assets obtained in exchange for lease liabilities
|
| | | | 490,342 | | | | | | 189,240 | | |
Weighted average remaining lease term (in years)
|
| | | | 2.9 | | | | | | 3.1 | | |
Weighted average discount rate
|
| | | | 1.45% | | | | | | 1.45% | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021 (remainder)
|
| | | ¥ | 430,043 | | |
2022
|
| | | | 620,210 | | |
2023
|
| | | | 363,730 | | |
2024
|
| | | | 183,145 | | |
2025
|
| | | | 110,723 | | |
2026 and thereafter
|
| | | | 132,480 | | |
Total
|
| | | | 1,840,331 | | |
Less: Interest component
|
| | | | (78,116) | | |
Present value of minimum lease payments
|
| | | ¥ | 1,762,215 | | |
| | |
Thousands of Yen
|
| |||||||||
| | |
Six Months Ended June 30,
|
| |||||||||
| | |
2021
|
| |
2020
|
| ||||||
Fixed sublease income
|
| | | ¥ | 217,083 | | | | | ¥ | 260,194 | | |
Variable sublease income
|
| | | | 7,961 | | | | | | 5,674 | | |
Total
|
| | | ¥ | 225,044 | | | | | ¥ | 265,868 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021 (remainder)
|
| | | ¥ | 178,798 | | |
2022
|
| | | | 313,207 | | |
2023
|
| | | | 198,400 | | |
2024
|
| | | | 82,997 | | |
2025
|
| | | | 43,103 | | |
2026 and thereafter
|
| | | | 28,198 | | |
Total
|
| | | ¥ | 844,703 | | |
| | |
Thousands of Yen
|
| |||||||||||||||||||||
| | |
Relaxation
Salon |
| |
Digital
Preventative Healthcare |
| |
Corporate
and elimination |
| |
Consolidated
|
| ||||||||||||
Six months ended June 30, 2021 (ASC 606) | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues
|
| | | ¥ | 2,110,561 | | | | | ¥ | 16,918 | | | | | ¥ | — | | | | | ¥ | 2,127,479 | | |
Operating income (loss)
|
| | | | 93,852 | | | | | | (65,004) | | | | | | (511,036) | | | | | | (482,188) | | |
Depreciation and amortization
|
| | | | 25,345 | | | | | | 4,201 | | | | | | 10,085 | | | | | | 39,631 | | |
Six months ended June 30, 2020 (ASC 605) | | | | | | | | | | | | | | | | | | | | | | | | | |
Revenues
|
| | | ¥ | 1,344,503 | | | | | ¥ | 11,774 | | | | | ¥ | — | | | | | ¥ | 1,356,277 | | |
Operating loss
|
| | | | (166,200) | | | | | | (21,016) | | | | | | (247,091) | | | | | | (434,307) | | |
Depreciation and amortization
|
| | | | 14,453 | | | | | | 3,771 | | | | | | 14,881 | | | | | | 33,105 | | |
| | |
Thousands of Yen
|
| |||||||||||||||
Revenue Stream*
|
| |
Relaxation
Salon |
| |
Digital
Preventative Healthcare |
| |
Consolidated
|
| |||||||||
Six months ended June 30, 2021 | | | | | | | | | | | | | | | | | | | |
Revenue from directly-operated salons
|
| | | ¥ | 1,421,413 | | | | | ¥ | — | | | | | ¥ | 1,421,413 | | |
Franchise fees
|
| | | | 125,513 | | | | | | — | | | | | | 125,513 | | |
Royalty income
|
| | | | 99,534 | | | | | | — | | | | | | 99,534 | | |
Staffing service revenue
|
| | | | 126,734 | | | | | | — | | | | | | 126,734 | | |
Sublease revenue
|
| | | | 225,044 | | | | | | — | | | | | | 225,044 | | |
Other franchise revenues
|
| | | | 112,323 | | | | | | — | | | | | | 112,323 | | |
Other revenues
|
| | | | — | | | | | | 16,918 | | | | | | 16,918 | | |
Total revenues
|
| | | ¥ | 2,110,561 | | | | | ¥ | 16,918 | | | | | ¥ | 2,127,479 | | |
| | |
Thousands of Yen
|
| |
Balance sheet classification
|
| |||||||||
| | |
As of
June 30, 2021 |
| |
As of
December 31, 2020 |
| |||||||||
Receivables
|
| | | ¥ | 89,416 | | | | | ¥ | 148,540 | | | | Accounts receivable-trade, net | |
Contract liabilities: | | | | | | | | | | | | | | | | |
Current
|
| | | | 92,988 | | | | | | 172,063 | | | | Contract liability (current) | |
Long-term
|
| | | | 297,523 | | | | | | 333,978 | | | |
Long-term contract liability – net of current portion
|
|
Total
|
| | | ¥ | 390,511 | | | | | ¥ | 506,041 | | | | | |
| | |
Thousands of Yen
|
| |||
| | |
Contract liabilities
|
| |||
Balance at December 31, 2020
|
| | | ¥ | 506,041 | | |
Revenues recognized during 2021 which were included in the contract liabilities balance at December 31, 2020
|
| | | | (131,269) | | |
Remaining amounts at June 30, 2021 which were newly recognized as contract liabilities during 2021
|
| | | | 15,739 | | |
Balance at June 30, 2021
|
| | | ¥ | 390,511 | | |
| | |
Thousands of Yen
|
| |||
Year ending December 31: | | | | | | | |
2021 (remainder)
|
| | | ¥ | 45,307 | | |
2022
|
| | | | 92,083 | | |
2023
|
| | | | 90,272 | | |
2024
|
| | | | 81,855 | | |
2025
|
| | | | 53,551 | | |
2026 and thereafter
|
| | | | 27,443 | | |
Total
|
| | | ¥ | 390,511 | | |
| | |
Six Months Ended June 30,
|
| |||||||||||||||||||||
| | |
2021
|
| |
2020
|
| ||||||||||||||||||
| | |
Common
|
| |
Class A
|
| |
Common
|
| |
Class A
|
| ||||||||||||
| | |
(Thousands of Yen)
|
| |
(Thousands of Yen)
|
| ||||||||||||||||||
Loss (Numerator) | | | | | | | | | | | | | | | | | | | | | | | | | |
Net loss attributable to shareholders of the Company
|
| | | ¥ | (521,770) | | | | | | — | | | | | ¥ | (442,971) | | | | | | — | | |
| | |
(Number of shares)
|
| |
(Number of shares)
|
| ||||||||||||||||||
Shares (Denominator) | | | | | | ||||||||||||||||||||
Weighted average common shares outstanding
|
| | | | 4,872,224 | | | | | | 1 | | | | | | 4,022,500 | | | | | | 1 | | |
Effect of dilutive instruments: | | | | | | | | | | | | | | | | | | | | | | | | | |
Stock options
|
| | | | — | | | | | | — | | | | | | — | | | | | | — | | |
Weighted average common shares for diluted computation
|
| | | | 4,872,224 | | | | | | 1 | | | | | | 4,022,500 | | | | | | 1 | | |
| | |
(Yen)
|
| |
(Yen)
|
| ||||||||||||||||||
Loss per common share attributable to shareholders of the Company
|
| | | | | ||||||||||||||||||||
Basic
|
| | | ¥ | (107.09) | | | | | ¥ | (107.09) | | | | | ¥ | (110.12) | | | | | ¥ | (110.12) | | |
Diluted
|
| | | ¥ | (107.09) | | | | | ¥ | (107.09) | | | | | ¥ | (110.12) | | | | | ¥ | (110.12) | | |
| | |
Thousands of Yen
|
| |||||||||||||||||||||
| | |
As of June 30, 2021
|
| |
As of December 31, 2020
|
| ||||||||||||||||||
| | |
Carrying
amount |
| |
Estimated fair
value |
| |
Carrying
amount |
| |
Estimated fair
value |
| ||||||||||||
Long-term borrowings — net of current portion
|
| | | ¥ | (573,275) | | | | | ¥ | (554,257) | | | | | ¥ | (668,380) | | | | | ¥ | (644,499) | | |
Exhibit
Number |
| |
Description
|
|
1.1** | | | | |
3.1** | | | | |
4.1* | | | | |
4.2* | | | | |
5.1** | | | | |
10.1* | | | | |
10.2+* | | | | |
21.1** | | | | |
23.1 | | | | |
23.2** | | | | |
24.1** | | | | |
107 | | | |
|
Signature
|
| |
Title
|
| |
Date
|
| | ||
|
/s/ Kouji Eguchi
Kouji Eguchi
|
| |
Chief Executive Officer and Representative Director
(Principal Executive Officer) |
| |
February 24, 2022
|
| | ||
|
/s/ Fumitoshi Fujiwara
Fumitoshi Fujiwara
|
| |
Chief Financial Officer and Director (Principal Financial and Accounting Officer)
|
| |
February 24, 2022
|
| | ||
|
*
Akira Nojima
|
| | Independent Director | | |
February 24, 2022
|
| | ||
|
*
Tomoya Ogawa
|
| | Independent Director | | |
February 24, 2022
|
| | | |
|
*By:
/s/ Fumitoshi Fujiwara
Fumitoshi Fujiwara
Attorney-in-fact |
| | | |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
We hereby consent to the inclusion in this Amendment No. 1 to Registration Statement (No. 333-262766) of MEDIROM Healthcare Technologies Inc. on Form F-1 of our report dated May 17, 2021 with respect to our audits of the consolidated financial statements of MEDIROM Healthcare Technologies Inc. as of, and for the years ended, December 31, 2020 and 2019, which includes an emphasis of matter paragraph as to significant uncertainty related to the future outcome from the outbreak associated with the COVID-19 pandemic, appearing in the Prospectus, which is part of the Amendment No. 1 to Registration Statement. We also consent to the reference to our firm under the heading “Experts” in such prospectus.
Our report refers to the adoption of new method of accounting for revenues and certain contract costs as of January 1, 2020.
/s/ BAKER TILLY US, LLP
Irvine, California
February 24, 2022
Baker Tilly US, LLP, trading as Baker Tilly, is a member of the global network of Baker Tilly International Ltd., the members of which are separate and independent legal entities. © 2020 Baker Tilly US, LLP
Exhibit 107
Calculation of Filing Fee Tables
FORM F-1/A
(Form Type)
MEDIROM HEALTHCARE TECHNOLOGIES INC.
(Exact Name of Registrant as Specified in its Charter)
Table 1: Newly Registered and Carry Forward Securities
Security Type | Security Class Title | Fee Calculation or Carry Forward Rule | Amount Registered | Proposed Maximum Offering Price Per Unit | Maximum Aggregate Offering Price | Fee Rate | Amount of Registration Fee | |||||||||||||||||||||
Fees to Be Paid | - | - | - | - | - | - | - | - | ||||||||||||||||||||
Fees Previously Paid | Equity | Common Shares, no par value(1) | 457 | (c) | 920,000 | (2) | $ | 6.71 | (3) | $ | 6,168,600.00 | (3) | 0.0000927 | $ | 571.83 | |||||||||||||
Carry Forward Securities | - | - | - | - | - | - | - | - | ||||||||||||||||||||
Total Offering Amounts | $ | 6,168,600.00 | (3) | $ | 571.83 | |||||||||||||||||||||||
Total Fees Previously Paid | 571.83 | |||||||||||||||||||||||||||
Total Fee Offsets | - | |||||||||||||||||||||||||||
Net Fee Due | $ | 0.00 |
(1) American Depositary Shares (which we refer to as “ADSs”) issuable upon deposit of the common shares registered hereby have been registered pursuant to a separate Registration Statement on Form F-6 (File No. 333-251170), which was declared effective on December 28, 2020. Each ADS represents one common share.
(2) Includes 120,000 common shares represented by ADSs, which the underwriters have an option to purchase.
(3) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) under the Securities Act of 1933, as amended, based on the average of the high and low prices of shares of ADSs as reported on The Nasdaq Capital Market on February 10, 2022.
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