Financial Results Overview
for Year Ended
March 31, 2024
Japan Asia Investment Co., Ltd.
(JAIC) (TSE 8518)
Announcement date : May. 15, 2024
Financial Results Overview for Year end of FY Mar. 2024 | © Japan Asia Investment Co., Ltd. 2024 | - 1 - |
Contents
1 | Summary | P3 |
2 | Results for the current fiscal year (year-on-year) | P4 |
3 | Review of the Medium-Term Management Plan | P8 |
4 | Result forecast | P12 |
5 | Appendix | P15 |
The figures in this document are based on consolidated financial statements prepared in accordance with the previous accounting standards.
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1. Summary
- Results for the current fiscal year (year-on-year)
- Operating revenue decreased to ¥ ９６４ million (down, 68.0 %).
- Net loss attributable to owners of parent was ¥ (1,５７４) million (widened, ¥1,３０５ million).
- Operating revenue decreased due to sluggish sales of private equity investments and project-oriented investments. Valuation losses from portfolio companies in Greater China widened the deficit.
- Review of the Medium-Term Management Plan
- Investment balance of financial investments decreased, but asset replacement was not completed
- Investment assets in group homes for people with disabilities increased
- Invested in new projects to diversify investment projects, but the contribution to profits is still small
- Sold two of strategic investment companies. On the other hand, some strategic investment companies experienced a significant deterioration in their performance.
- Unable to achieve numerical targets and in the red for 2 consecutive years
- Result Forecast
- Operating revenue is expected to ¥1,600～2,650 million and net profit attributable to owners of parent is expected to ¥250～950 million.
- Expecting to make a profit at the lower end through project sales, and aiming to reach the upper end through proceeds from the sale of unlisted stocks
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2. Results for the current fiscal year
Outline of results | P5 |
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2. Results for the current fiscal year - Outline of results - I/S
(million yen) | FY 2023 | FY 2024 | Change |
Operating revenue | 3,017 | 964 | (68.0%) |
Operating cost | 2,056 | 1,392 | (32.3%) |
Operating gross profit | 961 | (427) | - |
SG&A expenses | 1,147 | 1,094 | (4.6%) |
Operating income | (185) | (1,522) | - |
Ordinary income | (224) | (1,569) | - |
Profit attributable to owners of | (269) | (1,574) | - |
parent | |||
- Factors for decreased operating revenue and widened deficit
- Private equity investment
Although sales of listed stocks progressed, there was no sale of unlisted stocks with relatively large investment amounts.
Due to the liquidation of funds in Greater China, valuation losses and provisions are recorded for stocks whose expected recovery amount has decreased.
- Project-orientedinvestment
Gains from sales decreased; only one mega solar project was sold during the current fiscal year (Number of sales: 5 in the previous fiscal year, 1 in the current fiscal year)
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2. Results for the current fiscal year - Outline of results - B/S
(million yen) | FY 2023 | FY 2024 | Change | fluctuation factors |
(billion yen) | ||||
Total assets | 13,413 | 10,438 | (22.2%) | |
repayments of loan (0.8), | ||||
Cash and deposits | 2,464 | 1,750 | (28.9%) | execution of investments & loans |
(1.8), expenses etc.(0.7), | ||||
collection +2.6 | ||||
Project oriented investment securities & loans | execution of investments & loans | |||
after deducting allowance for possible | 6,053 | 5,248 | (13.3%) | +1.5, distribution & collection |
investment loss | (2.1), interests income/loss(0.2) | |||
Strategic investment securities in partner | ||||
companies after deducting allowance for | 782 | 913 | 16.7% | execution of investments +0.13 |
possible investment loss | ||||
Financial investment securities after | execution of investments +0.3, | |||
distribution & | ||||
deducting allowance for possible investment | 3,301 | 2,090 | (36.7%) | |
collection (0.6), unrealized gain | ||||
loss | ||||
(0.3), write-off & allowance (0.6) | ||||
Loans payable | 5,142 | 4,314 | (16.1%) | repayments of loan (0.8) |
Total shareholders' equity | 7,518 | 5,633 | (25.1%) | loss (1.5), unrealized gain (0.3) |
- Total assets decreased mainly due to investment collection, provision and writ-off of financial investments.
- Cash and deposits decreased due to repayments of loan and execution of investments & loans.
- Loans payable decreased due to repayments in accordance with agreement.
- Total shareholders' equity decreased due to loss and a decrease of unrealized gains.
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2. Results for the current fiscal year - Outline of results - C/F
(JPY million) | FY 2023 |
Operating cash flow | 157 |
Investing cash flow | 0 |
Financing cash flow | (806) |
Change in net cash flow | (635) |
Cash & cash equivalents at end of period | 1,762 |
FY 2024
456
(2)
(828)
(365)
1,396
- Operating cash flow increased year-on-year. Distribution from investment funds increased and payment for investment funds decreased.
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3. Review of the Medium-Term Management Plan
Review for 3 fiscal years from FY 2022 to FY 2024 P9
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3. Review of the Medium-Term Management Plan - Business Policy
Business policy
- Secure profits and funds by selling existing financial investment assets
- Increase the balance of project investment based on the new investment policy/Diversify investment target projects
Initiatives/Results/Current status
- Liquidated financial investment assets as early as possible and reduced the investment balance, however, asset replacement was not completed due to delays in IPOs and trade sales.
- The amount collected was lower than expected, and both profits and funds were insufficient.
- Business performance of some large-scale investees has worsened, resulting in provisions. Valuation losses and provisions are still factors causing downtune in our business performance.
- In Greater China, posting all losses on fund investment assets ahead of schedule due to the liquidation of investment funds.
- Investment in distribution centers took longer than expected to develop new projects, so the increase in investment balance was also lower than expected.
- Investment assets in group homes for people with disabilities increased due to significant progress in new transactions with regional financial institutions.
- Invested in new projects to diversify our investment targets, but the contribution to profits is still small and investments remain sporadic.
- Establish a hands-on investment style through collaboration in project investment and increase capital gains from strategic investees
- Two of our strategic investment companies achieved IPO and M&A.
- Some strategic investment companies experienced a significant deterioration in their performance.
- Some sales of shares in strategic investment companies did not proceed as planned.
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3. Review of the Medium-Term Management Plan - Action Plan
Action Plan | Initiatives/Results/Current status |
Private equity
investment
Renewable
energy
Distribution
center
(logistics
warehouse)
Smart
agriculture (vegetable factory)
Healthcare
(group home for disabled people)
Healthcare (facility for the elderly)
- Originate 3 new investment funds
- Increase investments in rooftop solar power generation project in Vietnam and biogas project in Japan.
- Sell mega solar projects in Japan after the completion to post gain on sale.
- Increase investments as a priority area.
- Invest in early stages of projects and achieve high returns by attracting later stage investors looking for middle-risk
- Support to develop customer base such as major convenience store and expand business size by constructing additional plant up to No.4
- Invest in 50 projects by originating funds from major banks and leasing companies
- Continue to invest in carefully selected projects
- AJ Capital, one of affiliated companies, has originated 2 investment funds.
- The second fund for business succession support has expanded its size to 5.1 billion yen and completed its origination.
- Rooftop solar power generation project in Vietnam has not been realized due to travel restrictions with COVID19.
- Invested in solar power generation systems with storage batteries on the rooftops of domestic logistics facilities.
- Domestic biogas power generation is taking time to become profitable, so additional investment has not been realized.
- Invested in NON-FIT type biomass power generation in Mie Prefecture
- 5 domestic mega solar plants have been completed and 4 have been sold.
- Invested in 4 new projects and sold 3 projects.
- It took longer than expected to develop new projects, and the increase in investment balance was also lower than expected.
- Expanding sales channels mainly to major restaurant companies.
- Expanding the business scale by expanding the Sasayama factory and acquiring the Yabu factory through a strategic investment company
- Sales at the Sasayama factory have increased, and will reach a monthly profit in the near future
- Investment asset balance increased due to significant progress in new transactions with regional financial institutions
- Invested in 24 buildings including investments from funds (28 buildings in total)
- Realizing a scheme to acquire multiple buildings at once through collaboration with construction companies
- No new investment was executed, but 1 existing investment project was sold and high profitability was achieved
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