Tokyu Fudosan Holdings Corp. · TSE:3289
Tokyu Fudosan — FY2022 Q2 Earnings Presentation
83 slides from Tokyu Fudosan's earnings presentation, November 2022
Slide 1: Financial Highlights FY2022 Second Quarter
Securities Code : 3289 Financial Highlights WE ARE GREEN Create Value for the Future FY2022 Second Quarter (First Six Months) Ended September-30, 2022 @ TOKYU FUDOSAN HOLDINGS
Slide 2: Forward-looking statements
The forecasts and other forward-looking statements in this report are based on currently available information and certain assumptions determined as rational. Consequently, any statements herein do not constitute assurances regarding actual results by the Group. Actual performance may significantly
Slide 3: Contents
| Contents | * Summary of the Financial Results for FY2022 Second Quarter, ° * ° ° 4 and Forecast for FY2022 * Segment Overview cee 7 * Sustainability and DX Initiatives oes 36 ¢ Financial Capital Strategy «ess AG * Overview of the Medium-term management plan 2025 -+-+-+ 53 * Reference eee 66 © TOKY
Slide 4: Summary of the Financial Results for FY2022 Second Quarter, and Forecast
Summary of the Financial Results for FY2022 Second Quarter, and Forecast for FY2022 © TOKYU FUDOSAN HOLDINGS CORPORATION
Slide 5: Highlights
| Highlights | Topics Contents Operating profit: 45.9 billion yen (+12.4 billion yen YoY) Net income* 26.9 billion yen (+12.6 billion yen YoY) Both revenues and profit increased YoY due to an increase in the number of condominiums units for sale and strong performance in the real estate agents busin
Slide 6: FY2022 Major business environment
| FY2022 Major business environment | Topics Offices Commercial facilities Condominiums Renewable energy facilities Contents Vacancy rates and office rent have not fluctuated significantly, but intensity of rent fluctuates by area. Tight supply-demand balance is expected to continue for the time bei
Slide 7: Revision of forecast for FY2022
| Revision of forecast for the FY 2022 | Plan to increase profit from the initial forecast due to strong real estate agents business backed by brisk sales market and an increase in the number of condominiums units for sale {Operating profit) ¥billi mon +3.2 billion yen vs. initial forecast 90.0 bill
Slide 8: FY2022 Q2 Operating Results, major index
| FY2022 Q2 (First Six Months) Operating Results, major index | Operating revenue, operating profit, ordinary profit, and profit attributable to owners of parent all achieved record highs in the second quarter Q Q2 Forecast** Operating Revenue 411.8 445.0 skis) 989.0 1,005.0 44.3% (Extraordinary inc
Slide 9: FY2022 Q2 Segment performance
| FY2022 Q2 (First Six Months) Segment performance | Profits increased except in the Urban Development business segment, where gain on sales by asset declined, and asset sales progressed steadily toward Full-Year Plan (¥ billion) Comparison note Q2 Q Operating revenue 411.8 445.0 33.3 Urban Developm
Slide 10: FY2022 Q2 Analysis of segment performance
| FY2022 Q2 (First Six Months) Analysis of segment performance | +12.4 billion yen compared to FY2021 Q2, +13.9 billion yen before transfer of loss on the COVID-19 Property Management business +0.3 billion yen Wellness business +3.6 billion yen: +4.0* billion yen Tokyu Hands business (exclusion) +2.
Slide 11: Interest-bearing debt by segment
Short-term borrowings Real Estate Agents CP 20.0 1% Current portion of 44.8 3% 63.4 bonds payable Real Estate Agents 31.8 8% Current portion of Property Management 20.0 1% 3% long-term borrowings Property Management & Operation 29.2 93.9 6% & Operation 168.0 4% 14% Strategic Investment 58.5 5%
Slide 12: Market value appraisal for leased properties
| Market value appraisal for leased properties (As of March 31, 2022) | Unrealized profit of leased properties increased thanks to the firm real estate market FY2020 FY2021 F (¥ ion) mparison Remarks Mar-2021 Mar-2022 Carrying Value 838.3 764.0 (74.3) CMarket value at the end of the fiscal year is c
Slide 13: Summary of Cash flow and Investment Plan
| Summary of Cash flow and Investment Plan | Non-current assets to be invested mainly in Kudan-Kaikan Terrace and renewable energy facilities, and inventories to be invested mainly in rental housing and logistics facilities, etc. FY2021 FY2022 P Main factors for changes [41.1 billion yen of profit b
Slide 14: FY2022 Performance forecasts, major index
| FY2022 Performance forecasts, major index | Upward revision of earnings forecast. Expected to achieve record highs for operating revenues, operating profit, ordinary profit, and net income for the full year (¥ billion, FY2021 eet Comp: el , |Compai note Forecast’ Operating Revenue 989.0 1,005.0 16
Slide 15: FY2022 Segment performance forecast
| FY2022 Segment performance forecast | Real estate transaction market remains brisk 2 | comparison | Comparison FY: ) (¥ billion) FY2021 Forecast | (FY2021) note Operating revenue 989.0} 1,005.0 16.0 5.0 Urban Development 325.8 348.0 22.2 13.0 Strategic Investment 67.0 75.0 8.0 (8.0) Property Manag
Slide 16: FY2022 Earnings forecasts and analysis of segment performance
| FY2022 Earnings forecasts and analysis of segment performance | +11.2 billion yen compared to FY2021, +12.7 billion yen before transfer of loss on the COVID-19 + Property Management business +2.6 billion yen + Wellness business +5.8 billion yen: +6.2* billion yen + Tokyu Hands business (exclusion)
Slide 17: Segment Overview
Segment Overview © TOKYU FUDOSAN HOLDINGS CORPORATION 17 nnn nnn nnncccccncnnnncnnnnnnnnnnnnnnnnnnnnneneneeeeeeee ener errr eee eee
Slide 18: Urban Development FY2022 Q2
| Urban Development @ FY2022 Q2 (First Six Months) | 2Q: increase in revenues but decrease in profit FY2022 forecast: expect to increase revenues but decreased in profit due to decrease in «Breakdown of revenues in Urban Development) [ubillion) number of residential units for sale, etc., despite inc
Slide 19: Urban Development Vacancy Rate and Rent
| Urban Development @ Vacancy Rate and Rent | As of September 30, 2022, Vacancy rate 2.7% Average office rent 28,360 yen (Month/Tsubo). (Office buildings and Commercial facilities) If the KUDAN-KAIKAN TERRACE which was completed in July, is excluded, the vacancy rate was remained at a low of 0.9%. V
Slide 20: Major projects schedule
FY2021 FY2022 FY2023 After FY2024 Or Before Jingumae 6-chome Block Redevelopment Project
Slide 21: Major projects (Greater Shibuya area)
| Urban Development @ Major projects (Greater Shibuya area) | Several projects are ongoing in the Greater Shibuya area © Redevelopment Project © Commercial facility © Office building © Properties owned by Activia Properties Inc. © Propertiesjoint capital investment with Norges Bank Redevelopment Pro
Slide 22: Major project: KUDAN-KAIKAN TERRACE
| Urban Development © Major project ~ KUDAN-KAIKAN TERRACE ~ | A workplace with "unique features" that combines history and state-of-the-art technology A facility where history and cutting-edge technology are integrated. Embodying the concept of “retro-modernism in bloom along the waterfront Partial
Slide 23: Initiatives in COVID-19 (GREEN WORK STYLE)
| Urban Development © Initiatives in COVID-19 (GREEN WORK STYLE) | Provide tenants with a one-stop service that leverages the Group's business domain to meet diverse office needs Multiple workplaces Environmental Initiatives Provide multiple and flexible workplaces to suit diverse work styles Suppor
Slide 24: Condominium index
| Urban Development @ Condominium index | Contract ratio at the end of second quarter was 90% BRANZ «Major upcoming projects) Deli Nai Unit eg No. of units sold ir 2,194 1,296 (QZ: 196) Fv2023 | HARUM! FLAG 4,145| ‘Average price per unit (million yen) 60 64 70 (Q2: 72) BRANZ Tower Osaka-hommachi 302
Slide 25: Strategic Investment FY2022 Q2
| Strategic Investment @ FY2022 Q2 (First Six Months) | 2Q: Increases both in revenues and profit FY2022 forecast: Increase in revenues but decrease in profit due to deterioration of overseas business, despite increase in asset sales | FY2021 | FY2022 «Breakdown of revenues in Infrastructure & indus
Slide 26: Strategic Investment Renewable energy business
| Strategic Investment @ Renewable energy business | The number of operating properties has increased, and it has grown to make a stable contribution to earnings Projects acquired Portfolio Properties in operation: 67 (solar: 62, wind power: 4, biomass: 1) © solarpowerplantin operation Hokkaido [x P
Slide 27: Expansion of renewable energy business
| Strategic Investment @ Expansion of renewable energy business Further expansion is planned through the solid execution of projects for which decisions have already been made and the acquisition of new non-FIT projects such as wind power generation and PPA projects Investment amount and operating p
Slide 28: Strategic Investment Logistics facilities business
| Strategic Investment @ Logistics facilities business | IJUILOGI'Q Development projects are sequentially put into operation. Revolving type business accelerated. Projects acquired (As of September30, 2022) Major projects Properties in operation: 5 Projects under development: 13 Investment progress
Slide 29: Strategic Investment Overseas operations
| Strategic Investment © Overseas operations | 18 projects are in progress in the United States 425 Park Avenue NewYork Office RedevelopmentProject 47 stories above ground with 2 basements Completed in January 2021 by Seattle(6) J Portland(2) e e| Bay Area(4) Washington DC(1)_ J - @ Los Angeles(1) e
Slide 30: Property Management & Operation FY2022 Q2
| Property Management & Operation @ FY2022 Q2 (First Six Months) | 2Q: Decrease in revenues but profit increase FY2022 forecast: Decrease in revenues but increase in profit due to recovery from the impact(Breakdown of revenues in of Covid19, despite the exclusion of Tokyu Hands from consolidation no
Slide 31: Property Management & Operation Stock of properties
| Property Management & Operation @ Stock of properties | Condominium Management Stock Trends Major properties under management m Under comprehensive management m Under facility management 800,000 Y 600,000 Yj 400,000 523,059 200,000 Z 19/3 21/3 23/3 Plan Total units 831,684 829,533 839,891 831,603
Slide 32: Main projects and Operation status
| Property Management & Operation @ Main projects and Operation status | Promote diverse developments such as Harvest Club, a membership resort for some of the hotels operated by other companies, and condominiums, etc. ROKU KYOTO, LXR Hotels & Resorts Tokyu Harvest Club Kyoto Tokyu Harvest Club VIAL
Slide 33: Real Estate Agents FY2022 Q2
| Real Estate Agents @ FY2022 Q2 (First Six Months) | 2Q: Increases in both revenues and profit FY2022 forecast: Increases in both revenues and profit, (Breakdown in revenues of Real mainly in the real estate agents business against the backdrop of brisk real estate sales market estate sales agent b
Slide 34: Performance indicators in sales agent
| Real Estate Agents @ Performance indicators in sales agent | FY2022 Q2 Wholesale Highlights Rate of change YoY No. of transactions 14,196 535 14,731 ORetail (units) 43.7% (1.7)% 4+3,5% + Both the number of transactions and amount of transactions increased from - FY2021 02. Amount of transactions 6
Slide 35: Changes in properties under management
| Real Estate Agents @ Changes in properties under management | Rental housing Management Stock Trends 120 110 100 ‘go B 80 ZZ 19/3 20/3 21/3 22/3 22/9 23/3 Plan (Units: thousand] 93 99 107 117 121 127 Greescdnetsedyen) +6 +6 +8 +10 | +4 +10 Student condominiums, etc. Management Stock Trends 56 52 4
Slide 36: Sustainability and DX Initiatives
Sustainability and DX Initiatives © TOKYU FUDOSAN HOLDINGS CORPORATION 36 nnn nnn nnncccccncnnnncnnnnnnnnnnnnnnnnnnnnneneneeeeeeee ener errr eee eee
Slide 37: Materiality and KPI
| Materiality and KPI | We will aim to achieve non-financial KPI based on materialities + Customer satisfaction level* 95% 90% or more 90% or more 100cases or more (10, fe ap Create a variety of COZ lifestyles 100cases or more Create communities — . Measures to revitalize communities 21cases and lif
Slide 38: Topics (Sustainability)
| Topics (Sustainability) | We resolve social issues through our business activities. ats Accelerating decarbonization efforts in the residential business Environment Anew slogan for the BRANZ condominiums-Environmental progress, starting with homes. The following initiatives will be introduced in B
Slide 39: Initiatives to realize a decarbonized society
| Initiatives to realize a decarbonized society | ot Environment Promote various initiatives to achieve SBT 1.5°C target for FY2030, and CDP Climate Change A list selected International Agreement concn Paris Agreements PARIS 2015 Keep the increase in temperature to well below +2°C IN CHATE CHINES CO
Slide 40: GX League endorsement
₂ ₂ ₂ Tokyu Land Corporation endorses the basic concept and participates in the preparation for the full-scale operation of GX League.
Slide 41: Disclosure by governance, strategy, risk management, indicators
• • • ✓ • • • • • • ✓ • • • • • • • • ✓ • • • ✓ • • Disclosure broken down into governance, strategy, risk management, and indicators and targets
Slide 42: Corporate Governance
| Corporate Governance | SF Governance Establish a governance system that contributes to ensuring sound and transparent management and strengthening the system for implementing the long-term management policy «Corporate Governance Structure) <System of Remuneration for Officers) Improved linkage bet
Slide 43: External evaluations
❬ ❭ ●Selected - Not selected / No evaluation
Slide 44: Roadmap for Value Creation through DX
| Roadmap for Value Creation through Dx | Se Dx By 2025, the group will promote labor-saving operations and the sophistication of customer contact, aiming for discontinuous and exponential growth by 2030 GROUP VISION 2030 Create value for the future 2021 2025 2030 Resilience phase Discontinuous and
Slide 45: DX Initiatives
| DX Initiatives | Sy ox Business process and CX reforms are underway Digital twinning of entire condominium By entering into a strategic partnership with Accenture and utilizing their Computer Generated Imagery (CGI), we will create and improve the CX of digital twins for BRANZ properties, and in t
Slide 46: Financial Capital Strategy
Financial Capital Strategy © TOKYU FUDOSAN HOLDINGS CORPORATION 46 nnn nnn nnncccccncnnnncnnnnnnnnnnnnnnnnnnnnneneneeeeeeee ener errr eee eee
Slide 47: Asset breakdown by segment
〈Asset breakdown by segment 〉 Rreal Estate Agents 202.1 Property Management & Human capital Operation utilization 405.8 608.0 Urban Total assets Development （Before adjustments） 1,595.3 2,746.6 Asset utilization Strategic 2,138.7 Investment 543.3 * Figures in parentheses are ROA of Asset-utilizing b
Slide 48: ROA and ROE
Companywide/ Excluding amortization
Slide 49: Financial Capital Strategy
| Financial Capital Strategy @ | Tere = Maintain financial discipline by executing hybrid financing and taking other steps mica Net assets mam Equity mam Interest-bearing Debt ites ; [billion] —e-Debt Equity ratiio -e- Debt/EBITDA ratio 30.0% 1,400 “tongtem A(sab a 1,200 Y 1,000 ? ' ] 12.0x . Pert N
Slide 50: Dividends
[Yen] [Yen] * Dividends before interim dividends for the fiscal year ended March 2014 are those paid by Tokyu Land Corporation.
Slide 51: Debt and financing composition
70% 50% 50.0 billion/18％ 10.0 billion/5%
Slide 52: The Group's ESG Bonds to Date
| The Group's ESG Bonds to Date | Sustainability-Linked Bond (October 2021) Term 10-year Issue Amount 10 billion yen Interest rate 0.300% per annum (Pricing Date: October 5, 2021) SPTs SPT1: Reduce greenhouse gas emissions by 46.2% by FY2030 SPT2: Achieve carbon-negative status by FY2025 On the matu
Slide 53: Overview of the Medium-term management plan 2025
Overview of the Medium-term management plan 2025 © TOKYU FUDOSAN HOLDINGS CORPORATION 53 nnn nnn nnncccccncnnnncnnnnnnnnnnnnnnnnnnnnneneneeeeeeee ener errr eee eee
Slide 54: © TOKYU FUDOSAN HOLDINGS CORPORATION
© TOKYU FUDOSAN HOLDINGS CORPORATION 54
Slide 55: Strengths of our Group: Assets and Human capital
strengths of our Group Assets Human strengths of our Group capital • • • • • • © TOKYU FUDOSAN HOLDINGS CORPORATION 55
Slide 56: © TOKYU FUDOSAN HOLDINGS CORPORATION
× • • • • • • • • • © TOKYU FUDOSAN HOLDINGS CORPORATION 56
Slide 57: Medium-term management plan
× Medium-term management plan • • • • © TOKYU FUDOSAN HOLDINGS CORPORATION 57
Slide 58: Medium-term plan targets
*1: Detailed targets are stated on p. 37. *2: Tokyu Cosmos Members Club questionnaire *3: Scope 1 & 2 under SBT certification *4: Profit attributable to owners of parent © TOKYU FUDOSAN HOLDINGS CORPORATION 58
Slide 59: Profit targets
¥ 65.0 billion ¥ 37.0 billion © TOKYU FUDOSAN HOLDINGS CORPORATION 59
Slide 60: Investment plan (net investment amount)
• • • • (net investment amount)*2 • • • • • • • • © TOKYU FUDOSAN HOLDINGS CORPORATION 60
Slide 61: Financial indicators and targets
53.1% 34.8% 35.0% 29.8% 27.3% 24.1% 25.4% 25.1% 25.1% 18.0 19.2% 17.0 16.0 16.0 15.5 14.5 13.0 12.0 10.0 8.0 © TOKYU FUDOSAN HOLDINGS CORPORATION 61
Slide 62: © TOKYU FUDOSAN HOLDINGS CORPORATION
© TOKYU FUDOSAN HOLDINGS CORPORATION 62
Slide 63: © TOKYU FUDOSAN HOLDINGS CORPORATION
• • • • • © TOKYU FUDOSAN HOLDINGS CORPORATION 63
Slide 64: © TOKYU FUDOSAN HOLDINGS CORPORATION
© TOKYU FUDOSAN HOLDINGS CORPORATION 64
Slide 65: © TOKYU FUDOSAN HOLDINGS CORPORATION
© TOKYU FUDOSAN HOLDINGS CORPORATION 65
Slide 66: Reference
Reference © TOKYU FUDOSAN HOLDINGS CORPORATION 66 SESS
Slide 67: Operating profit, Net income, ROE, ROA
Operating profit Net income ROE(%) ROA(%)
Slide 68: Segment classification
Urban Development(～2020) Property Management Wellness Tokyu Hands Innovation business Real-Estate Agents Residential
Slide 69: Process for Value Creation
| Process for Value Creation | We create unique and original business models by tackling social issues, and achieve sustainable growth by linking the value created to stakeholder sati: ~< Create value for the future SUSTAINABLE, DEVELOPMENT | GOALS Engagement themes Confronting social issues (materi
Slide 70: From the 2019 Integrated Report
* From the 2019 Integrated Report
Slide 71: Basic Policy for Increasing Shareholder Value and Corporate Value
| Basic Policy for Increasing Shareholder Value and Corporate Value | We will aim to enhance shareholder value and corporate value by realizing efficiency-conscious profit growth under an optimum financial capital structure Asset Control Liability and Equity Control fficient Improvement of Existing
Slide 72: Office vacancy and rent trends by ward
12.0 150.0 Chiyoda-ku Chiyoda-ku 10.0 140.0 Chuo-ku Chuo-ku Minato-ku Minato-ku 8.14 130.0 130.7 8.0 7.77 Shinjyuku-ku Shinjyuku-ku Shibuya-ku 122.7 Shibuya-ku 120.0 121.5 6.0 5.90 4.85 114.9 4.0 110.0 113.9 4.28 2.0 100.0 0.0 90.0 12/1 14/1 16/1 18/1 20/1 22/1 12/1 14/1 16/1 18/1 20/1 22/1 2,160 1,
Slide 73: Office portfolio by area and completed year
〈Area〉 〈Completed year〉 Metropolitan 4districts After 2011 727 thousand ㎡（91%） 45 buildings 397 thousand ㎡（50%） 11 buildings Kansai 1% -1980 2% 11 [1] 17 [6] Other metropolitan area 1% 1981-1990 10% 7 [1] 77 [9] Chiyoda-ku 1991-1995 5% 39 [8] Other Tokyo districts 18% 7% 145 [7] 1996-2000 2% 56 [5]
Slide 74: Business development addressing social issues (Diverse work styles)
| Business development addressing social issues (Diverse work styles) | Developing workspaces leveraging the Group's diverse assets City center City center — Suburban area Local Area Flexible office Workcation Center Office QUICK » xa7u# Individual workplace . Hotel Harvest QUICK solo NW NewWork Wor
Slide 75: Commercial facilities features
| Commercial facilities features | Developing commercial facilities in convenient areas, primarily in the Tokyo metropolitan area and the Kansai area (Features of our commercial facilities) Locations that are commercially busy and TOKYU OLAZA Q2 plaza convenient in terms of transportation Other Area
Slide 76: Transition in total floor area and AUM in Urban Development
| Transition in total floor area and AUM in Urban Development Segment | Promote expansion of assets involved {Total floor area) Thousand ni 2,000 =m Commercial facilities § Office buildings 1,648 1617 as7g 1 1,500 1,000 500 19/3 20/3, 21/3. 22/3 22/9 <AUM) ¥billion Private REITs, etc. 1,647.2 1,671.
Slide 77: Condominiums for Sale Market
| Condominiums for Sale Market | The number of units supplied remains stable at a low level. Average price remains high <New condominiums sold in the Tokyo metropolitan area and average price) [Number of units] [¥ thousand] 100,000 70,000 Number of units sold ===Avarege price 62.600 80,000 60,000 60
Slide 78: Major office buildings
| Major office buildings | Own 52 buildings mainly in 4 central wards of Tokyo No. of A : 7" space Shibuya Dogenzaka Tokyu 1983 13 Unosawa Tokyu 1984 15 Shibuya Shin-Minamiguchi 2000 7 Ebisu Business Tower 2003 23 Shibuya-ku 20 Shibuya Square 2004 13 Shibuya Minami Tokyu 2005 20 Shibuya Place 2009 4
Slide 79: Major commercial facilities
| Major commercial facilities | The Group operates 24 locations in the Tokyo area and 7 locations in Kansai and other regions No. of Major properties : [Commercial facilities] rot Tokyu Plaza Kamata 1968 Tokyu Plaza Akasaka 1969 Shibuya BE AM 1992 eA “ DECKS Tokyo Beach 1997 Tokyu Plaza Akasaka Nort
Slide 80: Major renewable energy facilities
| Major renewable energy facilities | The Group is advancing businesses through 73 solar power generation projects, 10 wind power generation projects and 2 biomass power generation projects Business Plantname Suzuran Kushirocho Kushiro-gun Kushiro-cho, Hokkai-do ReENE Tomakomai Tomakomai-shi, Hokkai
Slide 81: Major operating facilities
| Major operating facilities | The Group operates 65 hotels, 8,885 rooms Nu Num Name of facilities facilit rooms |Teteshina Hakone Myojindai Urabandai Grandeco Kyoto Takagamine Katsuura Madarao Nasu VIALA annex Kyoto Takagamine Hamanako Tateshina Annex. Kyu Karuizawa Annex Nasu Retreat Tokyu Harvest
Slide 82: Past performance (financial)
| Past performance (financial) | (¥ million) rts | rz | rvzns | rvzoie | _rzon7_ | rvzone_ | rraoi9 | x2020_ | F¥2021_| Operating revenue 714,067 773,149 815,479 808,503 866,126 901,884] 963,198 907,735 989,049 Operating profit Ordinary profit | _ Net profit* Total assets 1,789,822| 1,973,801] 1,984
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Tokyu Fudosan Holdings — FY2022 Q2 Earnings Presentation on 6ix