What this is
How Sanrio’s operating margin collapsed and recovered: 27.3% in the year to March 2014, 3.8% by March 2020, back to 27.0% by March 2024.
How it’s built
- Operating profit over sales from Sanrio’s filed results for each year.
- From 2014 to 2020 sales fell 28.2%, and 87% of the lost sales came out of operating profit (¥18.9bn of ¥21.7bn).
- Hello Kitty’s share of gross profit fell from 75.7% to 30.4% over the decade.
What we assumed
- The year to March 2020 is used as the low point.It ends before the pandemic, so the fall is not a COVID effect; the year to March 2021 (−8%) is left out.
- Hello Kitty’s 2019 share is read from a pie chart.Read off the chart layout, so only moderately certain.
Sanity check
This shows the downside of a character-licensing business: costs barely fall when sales do. It is a reference case, not evidence about Pokémon.
Where it comes from
Our calculation from other figures in the trainer’s notes.
Show the working
- To year to March 2020 sales change, year to March 2014: -28.2%
- To year to March 2020 decremental margin, year to March 2014: 87%
- 21,019/77,009 = 27.3%
- 6,904/62,695 = 11.0%
- 2,106/55,261 = 3.8%
- 26,952/99,981 = 27.0%
- 55,261/77,009-1 = -28.2%
- (21,019-2,106)/(77,009-55,261) = 18,913/21,748 = 87.0% of lost sales came out of operating profit