HULIC CO., LTD. April 25, 2024
FY2024 1Q (January - March) IR Presentation
Code
3003
2 Table of Contents
Page
03
Page
13
Appendix
FY2024 1Q Consolidated Performance Summary | Page | |
Executive Summary | 3 | 21 |
Financial Highlights | 4 | |
Income Statement | 5 | |
Segment Performance | 6 | |
Balance Sheets | 7 | |
Funding | 8 | |
Financial KPIs | 9 | |
Key Metrics / Shareholder Return | 10 | Page |
Quantitative Plan for FY2024 | 11 | 29 |
Planned Acquisitions FY2024 | 12 |
Priority Challenge (1) in MT Management Plan
Create a high-quality leasing portfolio and maintain / enhance the flexible earnings structure
Restructuring to High Quality Leasing Portfolio | 14 | |
Vacancy Rate & Rent History | 15 | |
Portfolio Distribution Pictures | 16-17 | |
Investment in Real Estate | 18 | |
CRE Business | 19 | |
Page | ||
Real Estate for Sale | 20 | |
40 | ||
Macro Environment | 45-47 | |
Corporate Value Improvement / Financial strategy | 48-49 | |
Corporate Profile | 50-61 | |
Priority Challenge (2) in MT Management Plan
Expand pipelines for development / reconstruction and Value-added projects, diversify exits to ensure profitability
Ongoing Projects | 22-25 |
Bank Branch Reconstruction | 26 |
Investment in Ginza Area | 27 |
Value Added Business | 28 |
Priority Challenge (3) in MT Management Plan
Promote new businesses to diversify revenue source
Initiatives for New Business Development | 30 |
Data Center | 31 |
Logistics Center | 32 |
Other Next Generation Assets | 33-34 |
Tourism-related Business | 35 |
Senior-related Business | 36 |
Flexible Office, Rental Office Business | 37 |
Education Business for Children | 38 |
Tender Offer, etc. for Riso Kyoiku | 39 |
Priority Challenge (5) in MT Management Plan
Continue to promote the sustainable management to address environmental issues and human capital development, etc.
Initiatives for Sustainability | 41-43 |
3 Executive Summary
Strategic reduction in real estate sales. Significant progress on 1Q investments
- 1Q ordinary profit lap: JPY21.2 bn, % of progress: 14.7% (against annual forecast of JPY144.0 bn)
- Reduced sales of real estate in 1Q strategically so as to maximize FY2024 earnings
- Sales of real estate are planned to be accelerated in / after 2Q
- Invested amount in 1Q: over JPY180.0 bn (gross amount)
- Accumulated investments mainly in large-scale CRE (Corporate Real Estate)
- Additional approx. JPY160.0 bn (gross) are almost confirmed for 2Q onward in FY2024
- Hotels / Ryokans segment (subsidiaries) outperformed our internal plan (+JPY0.5 bn)
- Expansion of Children Education Business
- On 8 April, announced TOB and subsequent subscription of new shares through a third- party allotment in Riso Kyoiku Co., Ltd. (4714 TSE Prime listed)
4 Financial Highlights (Consolidated)
Another record profit forecast for FY2024, 17th consecutive year of profit growth
Operating Revenue
(Billion yen) | 523.4 | ||||||||||||
500.0 | |||||||||||||
447.0 | 446.3 | (TBA) | |||||||||||
400.0 | |||||||||||||
357.2 | 339.6 | ||||||||||||
300.0 | |||||||||||||
200.0 | |||||||||||||
100.0 | |||||||||||||
112.5 | |||||||||||||
107.5 | |||||||||||||
0.0 | |||||||||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 | ||||||||
Ordinary Profit (Recurring Profit)
(Billion yen)
160.0 | 137.4 | (144.0) | ||||
140.0 | 123.2 | |||||
109.5 | ||||||
120.0 | 95.6 | |||||
100.0 | 84.6 | |||||
80.0 | ||||||
60.0 | ||||||
40.0 | ||||||
20.0 | 31.7 | 21.2 | ||||
0.0 | ||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 |
Operating Profit
(Billion yen)
160.0 | 146.1 | (153.0) | ||||
126.1 | ||||||
140.0 | 114.5 | |||||
120.0 | ||||||
100.5 | ||||||
100.0 | 88.3 | |||||
80.0 | ||||||
60.0 | ||||||
40.0 | ||||||
20.0 | 34.1 | 23.7 | ||||
0.0 | ||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 |
Profit attributable to Owners of Parent
(Billion yen)
100.0 | 94.6 | (98.0) | ||||
80.0 | 69.5 | 79.1 | ||||
58.8 | 63.6 | |||||
60.0 | ||||||
40.0 | ||||||
20.0 | 22.0 | |||||
15.8 | ||||||
0.0 | ||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 |
5 FY2024 1Q Income Statement (Consolidated)
1Q revenue and profit were lower since real estate sales are planned mainly in / after 2Q
FY23/12 | FY24/12 | Change (%) | ||
(Million yen) | 1Q | 1Q | ||
Operating Revenue | 112,561 | 107,593 | -4,968 | (-4.4%) |
Operating Gross Profit | 47,767 | 39,292 | -8,475 | |
SGA Expenses | 13,576 | 15,563 | 1,986 | |
Operating Profit | 34,190 | 23,728 | -10,461 | (-30.5%) |
Non-operating Income | 816 | 1,033 | 217 | |
Non-operating Expenses | 3,234 | 3,520 | 285 |
Major factors for changes
Real Estate Business | -7.7 bn |
Hotels / Ryokans | +3.4 bn |
Real Estate Business | -0.1 bn |
Hotels / Ryokans | +1.8 bn |
Real Estate Business -11.1 bn
Hotels / Ryokans | +0.8 bn |
Ordinary Profit | 31,772 | 21,241 | -10,530 | (-33.1%) | |||
(Recurring Profit) | |||||||
Gain on sale of investment | |||||||
Extraordinary Income | 777 | 3,511 | 2,733 | ||||
securities | +3.3 bn | ||||||
Extraordinary Losses | 274 | 1,325 | 1,051 | ||||
Total Income Taxes | 10,276 | 7,483 | -2,793 | Loss on reconstructions of | |||
buildings | +1.2 bn | ||||||
Profit attributable to | 22,009 | 15,858 | -6,150 | (-27.9%) | |||
Owners of Parent | |||||||
6 FY2024 1Q Segment Performance (Consolidated)
Reduced sales of real estate for sale strategically.
Hotels / Ryokans segment significantly outperformed our internal plan
(Million yen)
Operating Revenue
FY23/12
1Q
112,561
FY24/12
1Q
107,593
Change
-4,968
Major factors for changes
Existing / acquired / completed
Real Estate | 102,259 | 94,502 | -7,756 | |
Leasing / Management Revenue, etc. | 23,859 | 25,582 | 1,722 | |
Sales Revenue | 78,399 | 68,920 | -9,479 | |
Insurance Agency (subsidiary) | 1,046 | 1,070 | 24 | |
Hotels / Ryokans (subsidiaries) | 9,774 | 13,198 | 3,424 | |
Others | 1,592 | 1,510 | -81 | |
Elimination / Corporate | -2,110 | -2,689 | -578 | |
Operating Profit | 34,190 | 23,728 | -10,461 | |
Real Estate | 37,139 | 26,007 | -11,132 | |
Leasing / Management Profit, etc. | (39%) 14,465 | （52％）13,626 | -838 | |
Sales Profit | (61%) 22,674 | （48％）12,380 | -10,293 | |
Insurance Agency (subsidiary) | 432 | 444 | 11 | |
Hotels / Ryokans (subsidiaries) | 29 | 844 | 815 | |
Others | 152 | 115 | -37 | |
Elimination / Corporate | -3,564 | -3,683 | -119 | |
properties | +2.9 bn |
Transfer to real estate for sale | |
-2.0 bn | |
Others | +0.8 bn |
Existing / acquired / completed
properties+1.6 bn Transfer to real estate for sale
-1.2 bn
Others (Change in accounting*, etc.)
-1.2 bn
*Change in accounting treatment for development land rents for projects developed on land leased from third parties
Recovery in occupancy rate / ADR +0.8 bn
Note: Leasing / management revenue / profit, etc. is the amount subtracting sales revenue / profit from total real estate operating revenue / profit
Note: Percentage numbers in brackets: ratios of leasing / management profit, etc. and sales profit in real estate business
7 FY2024 1Q Balance Sheets (Consolidated)
PP&E and investment securities increased, reflecting large CRE* investments, etc.
(Million yen) | 23/12 | 24/3 | Change | |||
Current Assets | 372,973 | 395,700 | 22,726 | |||
Cash and deposits | 82,878 | 129,090 | 46,212 | |||
Real estate for sale | 263,089 | 231,426 | -31,663 | |||
Real estate for sale in process | 2,871 | 10,442 | 7,570 | |||
Assets | Non-current Assets | 2,105,731 | 2,269,459 | 163,728 | ||
Property, Plant and | 1,617,405 | 1,744,026 | 126,620 | |||
Equipment | ||||||
Investment Securities | 328,463 | 367,723 | 39,259 | |||
Marketable Securities | 143,173 | 160,519 | 17,346 | |||
Shareholdings/Investments | ||||||
185,290 | 207,203 | 21,913 | ||||
of Affiliated Companies, etc. | ||||||
Total | 2,480,472 | 2,666,929 | 186,456 | |||
Assets | Liabilities | 1,711,172 | 1,890,207 | 179,035 | ||
Borrowings | 1,034,029 | 1,098,503 | 64,473 | |||
Corporate Bonds | 411,000 | 523,985 | 112,985 | |||
Net | Deferred Tax Liabilities | 73,210 | 78,406 | 5,195 | ||
Net Assets | 769,300 | 776,721 | 7,421 | |||
& | ||||||
Liabilities | Shareholders' Equity | 706,794 | 701,953 | -4,841 | ||
Valuation Difference on | 58,943 | 70,061 | 11,118 | |||
Available-for-sale Securities | ||||||
Total | 2,480,472 | 2,666,929 | 186,456 | |||
Major factors for changes
Land・Buildings | +125.3 bn |
Acquisitions, completions +142.7 bn
Transfer | -14.5 bn |
Others | -2.9 bn |
MTM valuation | +16.0 bn |
Real estate investment through | |
SPC | +26.7 bn |
Commercial paper | +100.0 bn |
Quarterly net income | +15.8 bn |
Dividends paid | -20.6 bn |
(*) Corporate Real Estate
8 Funding
Favorable funding conditions continued. Funding is basically long-termfixed-rate base
External Rating
Instant Borrowing Capacity
(As of Mar. 31, 2024） | （Billion yen） |
JCR rating | AA－ / Stable | ||
Corporate Bonds | |||
(*) Sustainability Linked Bonds | |||
Coupon rate JPY |
OD limit | (outstanding balance) |
CP issue limit (outstanding balance)
Added SB limit / issued
154.0 ( - )
200.0 (100.0)
300.0 | (116.0) / 424.0 |
Date | (%) | (bn) | Tenor (year) | |
Apr. 24, 2014 | 5th Straight | 0.949 | 10.0 | 10 |
Oct. 22, 2018 | 6th Straight | 0.494 | 20.0 | 10 |
Jun. 25, 2019 | 7th Straight | 0.20 | 20.0 | 5 |
〃 | 8th Straight | 0.30 | 20.0 | 7 |
〃 | 9th Straight | 0.40 | 15.0 | 10 |
Jul. 2, 2020 | 2nd Hybrid | 1.28 | 120.0 | 35 (NC5) |
〃 | 3rd Hybrid | 1.40 | 40.0 | 37 (NC7) |
〃 | 4th Hybrid | 1.56 | 40.0 | 40 (NC10) |
Oct. 15, 2020 | 10th Straight (*) | 0.44 | 10.0 | 10 |
Oct. 19, 2022 | 5th Hybrid | 1.435 | 46.0 | 35 (NC5) |
〃 | 6th Hybrid | 1.849 | 30.0 | 40 (NC10) |
Apr. 13, 2023 | 11th Straight | 0.320 | 40.0 | 3 |
Feb. 29, 2024 | 12th Straight | 0.610 | 13.0 | 5 |
Average Funding Cost & Long-term Borrowing Ratio
Long-term borrowing ratio average interest rate (*)
（％） | （％） | |||||||||||||
100 | 1.00 | |||||||||||||
95 | ||||||||||||||
98.2 | 99.9 | 99.9 | 99.9 | 99.8 | 93.7 | |||||||||
90 | 0.90 | |||||||||||||
85 | ||||||||||||||
80 | 0.80 | |||||||||||||
75 | ||||||||||||||
70 | 0.70 | |||||||||||||
0.60 | ||||||||||||||
65 | 0.55 | 0.56 | 0.56 | 0.57 | 0.58 | |||||||||
60 | 0.60 | |||||||||||||
55 | ||||||||||||||
50 | 0.50 | |||||||||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/3 | |||||||||
(*) Average interest rate including hybrid finance is the following:
2019/12 | 2020/12 | 2021/12 | 2022/12 | 2023/12 | 2024/3 |
0.60% | 0.72% | 0.71% | 0.77% | 0.80% | 0.77% |
9 Financial KPIs
Maintaining financial discipline (pursuing both soundness and efficiency)
Safety and Efficiency
Equity | Equity ratio (*) | ROE | ||||
Financial Discipline
Total interest-bearing debt |
Net debt to equity ratio (*) |
(Billion yen) 800.0
700.0
36.8 37.1 37.9
32.7
30.0
35.4
（％） | (Billion yen) | Net debt to EBITDA ratio (*) | (times) | ||||
12.0 | |||||||
40.0 | 1,600.0 | ||||||
10.1 | 9.9 | ||||||
35.0 | 1,400.0 | ||||||
9.0 | 10.0 | ||||||
8.5 |
600.0
500.0
400.0
300.0
200.0
100.0
0.0
765.6 771.7
459.0 486.4 637.7 686.7
13.6 | 13.4 | 12.3 | 11.9 | 13.0 | ||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/3 |
30.0 | 1,200.0 | |||||||||||||||||
7.6 | 8.0 | |||||||||||||||||
25.0 | 1,000.0 | |||||||||||||||||
1,146.0 | 1,360.1 | 1,440.9 | 1,622.4 | |||||||||||||||
20.0 | 800.0 | 1,394.4 | 1,445.0 | 6.0 | ||||||||||||||
15.0 | 600.0 | 4.0 | ||||||||||||||||
10.0 | 400.0 | |||||||||||||||||
2.0 | 1.7 | 1.5 | ||||||||||||||||
1.3 | 1.3 | 1.3 | 2.0 | |||||||||||||||
200.0 | ||||||||||||||||||
5.0 | ||||||||||||||||||
0.0 | 0.0 | 0.0 | ||||||||||||||||
19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/3 | |||||||||||||
-
・50% of hybrid finance in FY2018 (75 bn=JPY150 bn x 50%) was calculated as nominal equity (Since Dec. 2018 to Dec. 2022） ・50% of hybrid finance in FY2020 (100 bn=JPY200 bn x 50%) was calculated as nominal equity（Since Dec. 2020)
・50% of hybrid finance in FY2022/2023 (75 bn=JPY150 bn x 50%) was calculated as nominal equity (Since Mar. 2023)
10 Key Metrics / Shareholder Return
Plan for 16 consecutive years of dividend increases for FY2024 by increasing EPS
EPS (Net income per share)
(Yen) | ||||||||||||
140.00 | 124.36 | 128.78 | ||||||||||
120.00 | ||||||||||||
88.93 | 95.23 | 101.09 | 104.00 | |||||||||
100.00 | ||||||||||||
80.00 75.18
60.00 | ||||||
40.00 | ||||||
20.00 | ||||||
0.00 | ||||||
18/12 | 19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 |
(plan) |
BPS (Book value per share)
(Yen)
1,200.00 | ||||||||
902.70 | 1,006.191,014.19 | |||||||
1,000.00 | ||||||||
800.00 | 728.31 | 836.89 | ||||||
608.49 | 687.01 | |||||||
600.00 | ||||||||
400.00 | ||||||||
200.00 | ||||||||
0.00
18/12 | 19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/3 |
Dividend History | Payout ratio guidance during |
the mid-term plan (2023-2025) |
: 40% or higher
(Yen per Share)
60.00 | 45.0% | |||||||
40.3%40.2% 40.3% | ||||||||
38.5% | 40.0% | |||||||
37.8% | ||||||||
50.00 | 33.9% | 35.4% | ||||||
35.0% | ||||||||
32.0% 32.6% | ||||||||
52.00 | ||||||||
40.00 | 50.00 | 30.0% | ||||||
42.00 | ||||||||
39.00 | 25.0% | |||||||
30.00 | ||||||||
36.00 | ||||||||
20.0% | ||||||||
31.50 | ||||||||
20.00 | 25.50 | 15.0% | ||||||
21.00 | ||||||||
17.00 | 10.0% | |||||||
10.00 | ||||||||
5.0% | ||||||||
0.00 | 0.0% | |||||||
16/12 | 17/12 | 18/12 | 19/12 | 20/12 | 21/12 | 22/12 | 23/12 | 24/12 |
(plan) |
Annual Dividend (Left axis) | Payout ratio (Right axis) | |
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Disclaimer
Hulic Co. Ltd. published this content on 26 April 2024 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 26 April 2024 14:36:29 UTC.
