HULIC CO., LTD. April 25, 2024 Company Name: Hulic Co., Ltd.
(3003JP TSE Prime) President: Takaya MAEDA
Contact: naruse.mayumi@hulic.co.jp
Financial Information for the First Quarter of FY2024 (January～March)
【SUMMARY】
- Summary of FY2024Q1 Performance Results
Executive Summary
Reduced sales of real estate in Q1 strategically so as to maximize FY2024 earnings.
- Aim to maximize leasing income, sales of real estate are planned in / after Q2 based on our forecast that the transaction market will continue to be stable and robust for the rest of 2024.
- FY2024 guidance is unchanged. Aim to achieve another year of record high profit and dividend per share.
- Made an excellent start on investment / acquisition, invested more than JPY180 Bn (gross amount) in Q1. In addition, we have a long list of investments for Q2 onward amounting approx. JPY160 Bn (gross). (cumulative investment in FY2024 will be approx. JPY340 Bn).
- Hotels / Ryokans segment (subsidiaries) continued to outweigh our internal target.
- Announced TOB and subsequent subscription of new shares through a third-party allotment in Riso Kyoiku Co., Ltd. (4714 TSE Prime listed) in order to further expand children education business.
(JPY Billion) | |||||||
FY2024Q1 | FY2023Q1 | Change | %Change | FY2023 | FY2024 Guidance | ||
Operating Revenue | 107.5 | 112.5 | -4.9 | -4.4% | 446.3 | - | |
Operating Profit | 23.7 | 34.1 | -10.4 | -30.5% | 146.1 | 153.0 | |
Ordinary Profit | 21.2 | 31.7 | -10.5 | -33.1% | 137.4 | 144.0 | |
Net Income | 15.8 | 22.0 | -6.1 | -27.9% | 94.6 | 98.0 | |
Annual dividend per share | na | na | 50.00 yen | 52.00 yen | |||
II. Major KPIs
(Japanese Yen) | ||||
2021/12 | 2022/12 | 2023/12 | 2024/3 | |
NIKKEI Index | 28,792 | 26,095 | 33,464 | 40,369 |
HULIC share price (close) | 1,092.00 | 1,040.00 | 1,476.50 | 1,571.50 |
Market capitalization | 838.6 Bn | 798.6 Bn | 1,133.8 Bn | 1,206.7 Bn |
Payout ratio | 38.5% | 40.3% | 40.2% | na |
EPS | 101.09 | 104.00 | 124.36 | na |
BPS | 836.89 | 902.70 | 1,006.19 | 1,014.19 |
Net Assets | 638.3 Bn | 687.1 Bn | 769.3 Bn | 776.7 Bn |
Unrealized value of real estate | 364.6 Bn | 375.8 Bn | 384.9 Bn | na |
- Key notes
Real estate business
The transaction market in Japan will continue to be active throughout 2024, supported primarily by ample liquidity provided by the financial institutions and BOJ's monetary easing policy. We
prioritized maximizing FY2024 earnings and significantly reduced sales of real estate in Q1 so that we can increase leasing income.
As a result, sales revenue and sales profit decreased by JPY9.4 Bn and JPY10.2 Bn YoY, respectively that led to declines of each profit line.
On the investment front, we acquired an aggregate of over JPY180 Bn of diversified assets including office, retail, logistic facility, laboratory, nursing home, etc. The need of companies to make effective use of their real estate assets is gathering momentum in Japan and we are making most of these opportunities.
Hotels / Ryokans (subsidiaries)
There is a room to further increase ADR on the back of strong travel demand from domestic and inbound tourists.
Riso Kyoiku, children education business
The aim is to purchase 51% of Riso Kyoiku Co., Ltd. shares and to make it our consolidated subsidiary. The maximum amount of TOB is approx. JPY12.6 Bn. Furthermore, we will subscribe a JPY3.4 Bn of its new shares if TOB is consummated.
Funding
We continue to fund with favorable terms. Average funding rate was unchanged in Q1. Financings are basically on long-term fixed rate basis.
Outlook for FY2024 Q2 onward
Macro environment
- Interest rates: a sharp rise is unlikely despite BOJ ending negative interest rate policy. BOJ will continue monetary easing.
- Real estate transaction market: continues to be solid.
- Liquidity: proactive lending attitude of financial institutions remains unchanged.
- Funding: limited impacts of BOJ ending negative interest rate policy due to long-term fixed- rate financing.
- Construction cost hikes: minor P/L impacts (i.e., depreciation and operating profits) as the land price proportion is relatively higher in project costs.
Focus of business
- Portfolio restructuring: continue to focus on investment / acquisition.
- Development: plan of developing over 100 properties is unchanged. 94 projects are in progress.
- Creating new businesses: continue to focus in targeted fields with high growth potential by employing M&As, business collaboration and alliance.
END
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Hulic Co. Ltd. published this content on 25 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 25 April 2024 06:52:12 UTC.
