Company Presentation for the Fiscal Year 2019/March

Pressance Corporation Co., Ltd.

Released in May 2019

[JPX Securities Code: 3254. T]• JPX-Nikkei Index 400 component• JPX-Nikkei Mid and Small Cap Index component

Table of Contents
I. Company Information

III. Business Strategies

Company Profile

p. 3

Area Strategies

p. 17

Corporate History

p. 4
p. 5

p. 18

Trends of Sales, Ordinary profit and Net income

Launch a new business driven by ReTech
to accelerate business growth

Trends of EPS, DPS and Stock Pricep. 6

Customer Benefits and Effects Expected from Braightp. 19

Business Outline

p. 7

Hotel Business

p. 20

Number of Units Sold by Area and Trends ofCondominium Average Prices

p. 8

Stock Business Expansion

p. 21

Expansion of Stock Business Profit

p. 22Market Position(Based on the number of units supplied in 2018)

p. 9

Cumulative Sales of Major Condominiums

p. 10

IV. Trends of Business Results and Forecasts

II. Our Strengths

Consolidated Income Statement (Summary)p. 24

Sales Results and Plan by Major Productin Condominium Sales Business

p. 25

Synergy of Our Three Competitive Advantages

p. 12

Consolidated Balance Sheet (Summary)p. 26(1) System to strengthen the salesforce

p. 13

Land Inventory (as of March 31, 2019)

p. 27(2) Sound Financial Cycle

p. 14
p. 15

p. 28

(3) Superior Products

Outlook for Achieving FY 2020/3 Sales Plan
and Outstanding Contracts (as of Apr. 1, 2019)

V. Shareholder Returns
Dividend Trends and Policy

p. 30

Objective on Share Price and Our Goal
with Prioritized Actions

p. 31

1

I. Company Information

Company Profile
Company Name

Pressance Corporation Co., Ltd.

Founded

October 1, 1997

Representative:

President and Representative Director: Shinobu Yamagishi

Location:

27th Floor Crystal Tower, 1-2-27 Shiromi, Chuo-ku, Osaka, Japan

Capital:2,404 million yen (as of March 31, 2019)

Number of Employees
as of March 31, 2019:

323 (Non-consolidated, average age: 30.4)
612 (Consolidated, average age: 32.5)

Business Outline:

Planning, development, sales and management of urban-type condominiums Planningand development of hotels

Major Products:• Studio condominium: selling a room one by one directly to an investor in real estate.
(Owners make rental contracts with residents.)• Family-type condominium: selling a room one by one directly to a family whopurchases and lives in the property.
• Condominium building sales: wholesaling all or part of a condominium building
mainly to other condominium dealers• Hotel: planning, developing, and selling hotel properties to other hotel companies(owning some of them).

End of Fiscal Year:

March

Stock Exchange
Listing:

Tokyo Stock Exchange, first section (Section Code: 3254)
JPX-Nikkei Index 400 component
JPX-Nikkei Mid and Small Cap Index component
3

Corporate History
1997
1997

October
October

1998 November
1998 December
1999

June

1999
2000
2002
2003
2005
2005
2007
2008

June
July
April
May
February
July
DecemberAugustFounded under the name Nikkei Prestige Co., Ltd.
Obtained Building Lots and Buildings Transaction Business License (License No. (1) 45679 issued by theGovernor of Osaka).
First condominium building under company brand sold: “Pressance Namba Higashi”
Founded Pressance Community Co., Ltd., (currently Pacific Co., Ltd.) for building management, insurance
agency business.
Founded Nikkei Assist Co., Ltd. (currently Pressance Jyuhan Co., Ltd.) to sell family condominiums.

2008 December
2013
October
2014
April
2014
August
2015
May
2015
August2016 September

Launched the real estate rental and management business.
First sale of an in-house developed property: “Pressance Shinsaibashi EAST”
Changed the company name to Pressance Corporation Co., Ltd.
First sale of in-house developed property in Tokai area: “Pressance Nagoyajo mae”
Opened the Nagoya Sales Center.
Promoted Nagoya Sales Center to Nagoya Branch.
Listed on the Second Section of the Tokyo Stock Exchange.
Founded Room Pro Co., Ltd. (currently Pressance Realta Co., Ltd.) to buy, sell and act as an agent for usedproperty.
Opened the Tokyo Branch.
Listed on the First Section of the Tokyo Stock Exchange.
Acquired shares of construction company TRYST Co., Ltd., making it into a subsidiary.
Founded Pressance Guarantee Co., Ltd. to deal with the rental guarantee obligation.
Founded Pressance Real Estate Co., Ltd. to conduct the real estate solution business.
Selected as a component of the “JPX Nikkei Index 400”.
Founded Prosehere Co., Ltd. to participate in real estate projects in ASEAN region and neighboring countries.

2016
2017

Selected as a component of the “JPX-Nikkei Mid and Small Cap Index”.
Selected as a Loan Margin Trading Issues.

DecemberJanuary4

Trends of Sales, Ordinary Profit and Net Income

Achieved record-high sales and income for 9 consecutive years+ Maintained high profitability(million yen)
160,000

140,000(million yen)

160,580

Sales
Ordinary Profit

35,00030,000134,059

Net Income
25,000120,000

26,531

101,083
100,000

80,00020,00078,990

September 2008

65,641

Lehman Brothers
Collapse

51,75560,00040,00020,000031,884 31,880 34,086
5,468
2,814

36,99812,06542,3499,329 10,264

7,464

4,711

5,326

2,641

2,975 4,096

5,351

6,286

7,758

13,7989,194

19,85818,296

15,414
13,757

15,00010,00010,5265,000

0FY2009/3 FY2010/3 FY2011/3 FY2012/3 FY2013/3 FY2014/3 FY2015/3 FY2016/3 FY2017/3 FY2018/3 FY2019/3
The Liberal Democratic
Party in power

The Democratic Party of Japanin power

The Liberal Democratic Partyin power5

Trends of EPS, DPS and Stock Price
Stable Profit Growth  Increasing Total Dividend Amount + Rising Stock Price• Continuous and Moderate Upward Trend in Stock Prices

Continuous EPS & DPS growth• Dropped since Sep. 2018 due to external factors.

1,377 JPY as of Friday, Mar. 29, 2019
2,000 JPY

EPS
DPS

¥296.43

4 for 1 stock split 2016/10¥232.58
1,500 JPY

¥178.99¥126.27¥40.50¥152.31¥29.40¥21.15¥12.50Mid-term¥17.501,000 JPY

Year-end¥23.00¥15.00500 JPY

FY '15

FY '16

FY '17

FY '18FY '19

‘15/1

‘16/1

‘17/1

‘18/1

‘19/1

Note: The company carried out a 4-for-1 stock split of common shares effective October 1, 2016. The stock split is factored into the figures
shown in the above graphs.

6

Business Outline
Major Products

Business Areas

StudioCondosHiroshima(1R/F)

Mixed

Hakata(1R/F)

Family-type
Condos

Kobe

Kyoto

Tokyo

(1R/F)(1R/F)(F)

Okinawa

Osaka

Nagoya(F)(1R/F)(1R/F)

Product Features
Type

Area per unit

Floor plan

FeaturesStudio Condos

Approx. 20-50 m2

Studio to 1LDK• Urban area
• Within 5 minutes by footfrom major railway station

Convenient locations(near universities, colleges, companies,
commercial facilities, etc.)

Family-type
CondosApprox. 50-100 m2

1LDK to 4LDKGood environment

Mixed

Approx. 20-100 m2• Urban, suburb area
• Within 10 minutes by footfrom major railway station• Urban, suburb area
• Within 5 minutes by footfrom major railway station

Studio to 4LDK

Selection Criteria(elementary and junior high school district,near companies, commercial facilities, etc.)

Criteria similar to those for studio condos
above

7

Number of Units Sold by Area and Trends of Condominium Average Prices
Number of Units Sold by Area and Type
HotelsCondominium building
Family-type Condos
Studio Condos

5,122(81.3%)

Trends of Condominium Average Prices

Unit: units

Family-type Condos

Unit: million yen

Studio Condos

Total condo units sold: 6,301

980

38.00

37.23

31.68

31.23

32.40

15.71

16.08

17.10

17.21

18.20

FY2015/3

FY2016/3

FY2017/3

FY2018/3

FY2019/3(19.1%)

825(16.1%)

1,605(31.3%)

1,175(18.6%)

55 (4.7%)
1,712(33.4%)

469 (39.9%)651

4(0.1%)(55.4%)

Kansai area

Tokai/Chukyo area

Tokyo Metropolitan
area◼ Focus on Kansai, Tokai and Chukyo areas*Condominium building sales: wholesaling all or part of acondominium building mainly to other condominium dealers◼ Cost saving by large volume  Pricing Advantage◼ Core customers  Persons with Avg Salary8Market Position (Based on the number of units supplied in 2018)
The number of units supplied to the market in 2018 (Jan. 1 to Dec. 31 in 2018)
Tabulated by the Company based on the data provided by Real Estate Economic Institute Co., LTD.
RegionKansai

Chukyo/Tokai

Total

Ranked No. 1 for 9
consecutive years

Ranked No. 1 for 7
consecutive years

Ranked No. 2 for 2
consecutive years

Number of our supply

4,133 units

1,019 units

5,267 units

Cumulative number ofsupply20,958 units

5,115 units

80,256 units

19.7%

19.9%

6.6%

Our Ranking

Market share *Top 5ranking andsupplied
units

No. 1

Pressance
Corporation

4,133 units

Pressance
Corporation

1,019 units

Sumitomo Realty
Develop

7,377 units

No. 2

Nihon Eslead

2,401 units

Nomura Real
Estate425 units

Pressance
Corporation

5,267 units

No. 3

Nissho Estem

1,053 units Daikyo

270 units

Nomura Real
Estate5,224 units

No. 4

Hankyu Hanshin
Properties

966 units Shizuoka Railway

253 units

Mitsubishi Jisho
Residence

3,614 units

No. 5

Kintetsu Real
Estate734 units Takara Leben

228 units

Mitsui Fudosan
Residential

3,198 units* Calculated by the Company based on the data provided by Real Estate Economic Institute Co., Ltd.
9

Cumulative Sales of Major Condominiums
Osaka
319 buildings 21,402 units
Aichi
169 buildings 10,575 units
Kyoto
76 buildings 3,792 units
Hyogo
72 buildings 5,436 units
Shiga
10 buildings 1,508 units
Okinawa
20 buildings 1,073 unitsTokyo
16 buildings
931 units
Hiroshima
5 buildings
410 units
Others20 buildings 1,525 units
Total
707 buildings 46,652 units(Note) The numbers of buildings and units are accumulated figures from
November 1998 to March 31, 2019.

Pressance Umeda Kita All(Osaka City/Studio Condominium)

Pressance Grand Izumi(Nagoya City/Family-type
Condominium)

Pressance Loger
Kobe Port Island(Kobe City/Family-type
Condominium)

Pressance Legend
Sakaisuji-Honmachi Tower(Osaka City/Family-type
Condominium)

10II. Our Strengths

Synergy of Our Three Competitive Advantages(1)
System tostrengthen thesalesforce

Higher asset
valuesFewer finishedgoods inventory

(2)
Sound
Financial
Cycle

(3)
Superior
Products

Advantageous and prompt
procurement
12(1) System to strengthen the salesforce

Basic Sales Policy

To sell out all condos upon the completion of construction

Mechanism to strengthen salesforce
New hires grow quickly by man-toman training with his/her manager• As soon as new employees find the slights bit of demand frompotential customer, they quickly pass the baton over to the managers.
• Managers then complete all the task to close the deal, showing sales
method and customer handling skills to the new employees.
• New employees can learn how to successfully close deals andexperience lots of “Success Experiences” in a short period of time,
exercising the same procedures and skills. As a result of this , newemployees can quickly be independent.

All sales persons focus on the sales
for one property for a certain period.
 Promoting competition within theorganization• Intense competition between sales personnel who fully understandthe features of self-developed properties.

Transparent evaluation system withrewarding incentives
 Maintaining high motivation• ESOP and stock option that allow employees to own treasury stocks.

• Competition under equal condition among rivals at the same level ofsales skills.
• Competition between the team of a new hire and a manager versus
senior colleagues.

• Wage rise and promotion twice a year, regardless of career in thecompany or age.

Strong salesforce  Early capital recovery and sales growth driven by quick sellout13

(2) Sound Financial Cycle
Inventory Assets (consolidated)

Outstanding Borrowings andOutstanding Orders + Cash

(Unit: million yen)
Real estate for sale(Finished goods inventory)
Real estate for sale in process(under construction)

225,302

Return on Equity (ROE)(Unit: million yen)
Outstanding borrowings(including corporate bonds)

228,515

22.1%

Outstanding orders + Cash

180,461

149,815

122,17420.8%

171,915

19.4%
18.9%

99,71788,37619.2%

178,087
142,494

4,173

14,324FY'16/3

11,275FY'17/3

FY'18/3

9,603
FY'19/3• Increase in-process inventory every

term for future sales and profits• Minimal inventory of finished goods

56,706

101,101

FY'16/3

FY'17/3

FY'18/3

FY'19/3• Enough outstanding orders to repay borrowings• Early repayment of project loans• Good relationships with financial institutions

 Borrowing on favorable terms

FY'15/3 FY'16/3 FY'17/3 FY'18/3 FY'19/3• Over 10% growth in net income fornine consecutive FYs• Share buybacks during FY 2016/3• Maintain high ROE• Continuous and substantial profit

growth generates upward trend

Positive financial cycle generated by active procurement, solid sales and favorable borrowing terms
14(3) Superior Products
Location

Price

Convenience:
From major railway station in the center of cities and surrounding area,• Studio Condos: within 5 minutes by foot• Family-type Condos : within 10 minutes by footHigh Cost PerformanceReasonable selling price

Facilities
High value-added: focusing on luxury, comfortability and functionality
LuxuryComfortability• CATV (Up to 159 channels)• Sound proof window T-2• Sound insulation flooring
Functionality• Prefabricated bath with a bathroom laundry dryer• Gas hot water floor heater• Auto light sensor

High asset value and high brand value for a long period of time15

III. Business Strategies

Area Strategies

Dominant strategy
We advance our business activities, focusing on certain areas
Cumulative number of Pressance-brandcondominiums supplied

Effects by Dominant strategy(from the foundation to March 31, 2019)

Kinki area
480 buildings,
32,439 units

Tokai/Chukyo area

179 buildings,
11,239 units

Okinawa area
20 buildings,
1,073 units(1) Acquiring the information of selling lands ona priority basis and intensively, we canpurchase lands much more than competitors.
(2) Maximize the cost-effectiveness of advertisingexpenses by focusing media promotion (TVcommercials, etc.) on limited areas.
(3) Customers can see the real supply condos,
which increase brand recognition and trustfrom customers.

Due to our large market share, competitors face difficult circumstances
to newly enter and compete.
17

Launch a new business driven by ReTech to accelerate business growth
Our ReTech

Image of sales growth(Note) The figure has been prepared for referential purposes only.
Actual time and amount are not taken into consideration.

Sales
Website for property for investment,

Utilizing AI and Technology

Sales generated by ReTech“Braight”

Our track record of a large
number of transactions(707 buildings, 46,652 units)

Additional sales revenues contribute tomed- and long-term performance growth

Sales from existing
businesses

Big data for real estatetransactions(About 60 million transactions)Time
Present

2021/3The new ReTech-driven business will generate additional sales on top of sales
from existing businesses (forecast figures).
Sales targets
for the new ReTech-driven business

FY 2022/3

FY 2023/3

FY 2024/3

10,800 million yen

16,560 million yen

24,480 million yen
18

Customer Benefits and Effects Expected from Braight
Braight Content

Customer Benefits

Lab

Offers news andcolumns on a wide
range of topics

Simulator

AI simulate values& revenue forecasts
of properties

ArrivalInformation about
our new properties
for saleVintage

Information about
our used properties
for sale

Owner
App

Asset management
app for owners

Customers can get information
anytime they want at their own pace.

Customers can visualize real estatevalues: Customers can grasp fairmarket price values via AI simulation.

Expected effects on our performance

Increase in the number of potential
customers, including digital natives

Increase in sales of
New and used properties

Customers can easily recognize highmarket value of our properties.

Use of information systems ensuressmooth communication andcustomer services.

Enhancement of customer service
and operational efficiency

Personalized buyer support, face-to-face and/or by phone
Increased sales + Reduced cost = Accelerated performance growth
Enhanced brand power via synergy between Pressance and Braight = Enhanced corporate value
19Hotel Business
A total of 23 hotels, including 9 delivered, 12 under development, 1 company-owned, and 1 for renovation
Hotel operating pattern [Due to changes of plans, it may be changed in terms of the patterns (A or B), the number of units and completion time.]
A: To be sold to hotel business companies (specific buyers/candidates)
22 properties
B: To be owned by Pressance, and its operation will be outsourced to a hotel operating company
1 property
Address

Operating pattern

Nearest Railway Station

FY 2018 ended
in March

1
2

Inari, Naniwa-ku, Osaka-city
Motomachi, Naniwa-ku, Osaka-city

Delivered Apr. '17
Delivered Oct. '17

JR Namba
JR Namba

FY 2019 ended
in March

1
2
3
4
5
6
7

Minamisemba, Chuo-ku, Osaka-city
Hiranomachi, Chuo-ku, Osaka-city
Nishimiyahara, Yodogawa-ku, Osaka-city
Shikitsuhigashi, Naniwa-ku, Osaka-city
Tenjinyamacho, Nakagyo-ku, Kyoto-city
Gojo-Omiya-dori, Shimogyo-ku, Kyoto-city
Goko-dori, Chuo-ku, Kobe-city

Delivered Apr. '18
Delivered Apr. '18
Delivered Jul. '18
Delivered Jul. '18
Delivered Sep. '18
Delivered Sep. '18
Delivered Sep. '18

Shinsaibashi on Subway Midosuji Line
Kitahama on Subway Sakaisuji Line
JR Shin-Osaka
Daikokucho on Subway Midosuji Line
Shijo on Subway Karasuma Line
Ohmiya on Hankyu Kyoto Line
JR Sannomiya

FY 2020 endingin March

1
2
3
4
5
6
7

Nakadori 3chome, Akita-city *Noboricho, Naka-ku, Hiroshima-city
Minamihonmachi, Chuo-ku, Osaka-city
Aburanokoji-dori, Shimogyo-ku, Kyoto-city
Kamikawabatamachi, Hakata-ku, Fukuoka-city
Nishikujozaocho, Minami-ku, Kyoto-city
Oicho, Nakagyo-ku, Kyoto-city

FY 2021 endingin March

1
2
3
4
5
6
7

Yasaka-dori, Higashiyama-ku, Kyoto-city,
Onoecho, Naka-ku, Yokohama-city
Nishi 2chome, Naha-city
Motomachi 2chome, Naniwa-ku, Osaka-city
Sennichimae, Chuo-ku, Osaka-city
Tenyamachi, Hakata-ku, Fukuoka-city
Toganocho, Kita-ku, Osaka-city* renovation

B (Will deliver f rom FY 2021/3)
A
A
A
A
A
A
A (Completed FY 2019/3)
A
A
A
A
A
A

Akita on Akita-Shinkansen, JR Uetsu-honsen
Ebisucho on Hiroshima Dentetsu
Hommachi on Subway Midosuji Line
Gojo on Subway Karasuma Line
Nakasukawabata on Subway Hakozaki Line
JR Kyoto
Marutamachi on Subway Karasuma Line
Kiyomizugojo on Keihan Line
JR Kannai
Asahibashi on Yui RailJR Namba
Namba on Subway Midosuji, Nankai Line
Gofukumachi on Subway Hakozaki Line
Higashi Umeda on Subway Tanimachi Line# of rooms

72
111
124
116
120
300
63
122
135
234
126
174
166
204
120
12
7
277
240
300
182
180
117
20

Stock Business Expansion(1) Expansion of the rental property
management business
Reduce owners’ rental property management
burdens and secure profitability for owners
maintaining high occupancy rates.

(1) Number of rental properties managed(#of units)(2) Number of company-owned properties(# of units)
17,632(3) Number of buildings managed(# of buildings)

14,478(2) Expansion of the condominium rental
business (company-owned condos)
Own superior rental properties such as studiocondominiums

19,038

12,204
10,858
9,699

1,133

8,781

1,186 1,196(3) Expansion of the building managementbusiness
650

Maintain the asset value of property for a long
period of time through finely-tuned
management by expert staff

527

532
268
139

168

197

241

282

395

450

FY'13/3 FY'14/3 FY'15/3 FY'16/3 FY'17/3 FY'18/3 FY'19/3

Secure stable sources of income(Source)

Number of rental properties managed and number of company-owned
properties: Pressance Corporation Co., Ltd.
Number of buildings managed: Pressance Community Co., Ltd.

21

Expansion of Stock Business Profit
Flow Business

Stock BusinessStudio condo sales

Rental property management

Family-type Condo sales

Buildings maintenance management

Condominium building

Property insurance agency

Hotel development & sales

Internal/external repair works on buildings

Expand the number of condo sales

Stock Business Sales and Profit
will be automaticallyaccumulated and increased.

Rental revenue on owned condos

Sales and Operating Profit (Stock Business)
Sales of stock biz
Operating profit of stock biz(Unit: million yen)
5,535
4,607

September 2008
Lehman Brothers
Collapse

3,244

3,786

2,580

1,546

1,672

1,834

701

954

1,211

1,278

648

808

836

1,524

FY'11/3

FY'12/3

FY'13/3

FY'14/3

FY'15/3

FY'16/3

FY'17/3

FY'18/3

1,101
414

1,251

1,482

452

FY'09/3

FY'10/3

1,752

FY'19/3
22

IV. Trends of Business Results and Forecasts

Consolidated Income Statement (Summary)• 10% or more year-on-year increase in sales and profits for 9 consecutive years. Sales and profits hit record highs(Operating profit in FY 2019/3 increased by 33.2% year on year)• Plan to continuously achieve year-on-year operating profit growth of 10% or more, one of our targets
FY 2018/March
Results
AmountsA

FY 2019/March
Results
Amounts
YoY (%)B
B/A

FY 2020/March
Plan
Amounts
Ratio
YoY (%)
to salesC
C/B[Units: million yen]
FY 2021/March
Plan
Amounts
Ratio
YoY (%)
to sales
D
D/C

Sales

134,059 160,580 119.8% 209,219 100.0% 130.3% 250,960 100.0% 120.0%

Cost of Goods Sold

99,575 116,378 116.9% 154,940

74.1% 133.1% 190,355

75.9% 122.9%

Gross Margin

34,484

44,201 128.2%

54,278

25.9% 122.8%

60,604

24.1% 111.7%

SG & A expenses

14,121

17,082 121.0%

21,746

10.4% 127.3%

24,1699.6% 111.1%

Operating Profit

20,362

27,118 133.2%

32,531

15.5% 120.0%

36,434

14.5% 112.0%

Ordinary Profit

19,85826,531 133.6%

31,429

15.0% 118.5%

35,108

14.0% 111.7%

13,757

18,296 133.0%

21,520

10.3% 117.6%

23,984

9.6% 111.4%

Net Income
attribute to shareholdersof parent company

FY 2019/3 Results: • Sales were up by 26,520 million yen from FY 2018/3 due to strong sales.
• Operating profit was up by 6,756 million yen as a 9,717 million yen increase ingross margin offset 2,961 million yen increase in SG & A expenses.
Sales and profits will continuously increase in FY 2020/3 and FY 2021/3.

24

Sales Results and Plan by Major Product in Condominium Sales Business
FY 2018/March
Results
AmountNo. of(¥ million)
units
A

YoY
(%)

FY 2019/March
Results
AmountNo. of(¥ million)
units
B

YoY
(%)
B/A

FY 2020/March
Plan
AmountYoY(¥ million)
(%)
C
C/B

FY 2021/March
Plan
AmountYoY(¥ million)
(%)
D
D/C

70,765

Studio Condos

1,726

29,707

91.5% 2,363

43,011 144.8%

70,901 164.8%

Family-Type Condos

1,860

71,156 141.0% 2,078

77,375 108.7%

74,757

Condo Building Sales *1,246

19,318 161.4%

880

12,45964.5%

24,715 198.4%

29,238 118.3%

2,744

980

17,625642.3%

18,292 103.8%

17,888183

Hotel Sales

NA

99.8%

96.6% 120,037 160.6%

97.8%

5,015 122,926 129.6% 6,301 150,472 122.4% 188,666 125.4% 237,928 126.1%

Total

FY 2019/3 results: Sales were up due to strong sales.
On a year-on-year basis, sales increased by 1,286 units and 27,546 million yen.
•Studio condos:

Sales to increase by 637 units and 13,304 million yen•

Family-type condos:

Sales to increase by 218 units and 6,218 million yen•

Condominium building sales: Sales to decrease by 366 units and 6,858 million yen•

Hotel sales:

Sales to increase by 5 buildings (797 rooms) and 14,881 million yen

FY 2020/3 plan: Growing sales of studio condos will drive sales and earnings up.
FY 2021/3 plan: Growing sales of family-type condos will drive sales and earnings up.
* Condominium building sales: wholesaling all or part of a condominium building mainly to other condominium dealers25

Consolidated Balance Sheet (Summary)(million yen)

Current Assets
real estate for salereal estate for sale in process
Non-current Assets
Total Assets
Current Liabilities
short-term liabilities with interest
Non-current Liabilities
long-term liabilities with interest
Total Liabilities
Total Net Assets
Total Liabilities and Net Assets

As of March 31, 2017

As of March 31, 2018

Results(million yen)

Results(million yen)

171,810
14,324
122,174
13,497
185,307049,43825,41076,25375,691
125,691
59,615
185,307

Composition
ratio

92.7%
7.7%
65.9%
7.3%
100.0%
0
26.7%
13.7%
41.1%
40.8%
67.8%
32.2%
100.0%

227,161
11,275
180,461
18,237245,399
067,53740,473
102,689
102,021
170,226
75,172
245,399

Composition
ratio

92.6%
4.6%
73.5%
7.4%
100.0%
0
27.5%
16.5%
41.8%
41.6%
69.4%
30.6%
100.0%

As of March 31, 2019
Results(million yen)

280,591
9,603
225,30221,350301,942
082,91654,467
124,407
123,619
207,323
94,618301,942

Composition
ratio

Changes(million yen)

53,4303.2% ▲ 1,672
74.6% 44,840
7.1%
3,112
100.0% 56,543
0027.5% 15,379
18.0% 13,994
41.2% 21,717
40.9% 21,597
68.7% 37,096
31.3% 19,446
100.0% 56,543
92.9%

We adopted the Partial Amendments to Accounting Standard for Tax Effect Accounting, etc. beginning in the fiscal year ended March 31, 2019.
These changes have been applied retroactively to the figures for current and fixed assets as of March 31, 2018.

Results as of March 31, 2019 (major year-on-year changes)
Current Assets:
Real estate for sale down by 1,672 million yen, real estate for sale in progress up by 44,840 million yen
Non-current Assets:
Rental properties (net) up by 1,315 million yen(newly owned 5 properties, transferred 3 properties to real estate for sale)
Liabilities:
Borrowings from banks up by 38,492 million yen
Shareholders’ Net Assets:
Recorded net income of 18,296 million yen* Details of land inventory (figures in the red frame) are provided on the next page.

26

Land Inventory (as of March 31, 2019)
Breakdown of the number in the red frame on
the previous page

Amount(million yen)

Real Estate for Sale

9,603
2,653
2
6,947
225,302
159,300
20,50045,500Land Cost for Condominium Biz A
Other Land Cost
Construction Cost

Real Estate for Sale in Process
Land Cost for Condominium Biz B
Other Land Cost
Construction Cost

Land Cost for Condominium Biz A + B
Studio Condominium
Family-type Condominium
Condominium Building Sales
Hotel Sales

Land inventories of condominium business(million yen)
134,210102,055 106,172'17/9'17/12

161,954
141,727

116,662 119,255

'18/3

'18/6

'18/9

'18/12'19/3

Amount(million yen)Units161,954

24,62554,25575,767
18,881
13,04911,159 Equivalent to the sales volume for about next 3 years
8,074 Equivalent to the sales volume for about next 3 years
3,699 Procured the lands for scheduled delivery up to March 2021
1,693 Procured the lands for scheduled delivery up to March 2021

Volume of procured land compared with sales plans✓ Land Inventory includes the land procured and registered as the company properties.
(In addition to the figures above, there are 55 buildings with 4,027 units for which land purchase and sale agreements have been signed but payments
have not been made. These include 3,070 studio condo units and 957 family-type condo units.)✓ The sum of land cost for the condominium business (included in inventory total) of A + B of 161,954 million yen is obtained by aggregating realestate for sale (9,603 million yen) and real estate for sale in process (225,302 million yen), minus other land cost (2 million yen + 20,500 million yen =20,503 million yen) and construction cost (6,947 million yen + 45,500 million yen = 52,448 million yen), recoded in the balance sheet for FY 2019/3.
* Other land cost includes land acquisition-related costs for real estate to be owned, land to be sold, and housing sales operations.

27

Outlook for Achieving FY 2020/3 Sales Plan and Outstanding Contracts (as of Apr. 1, 2019)
As of the beginning of FY 2020/3, already achieved 73.3% of this fiscal year’s sales target for condominium sales
as well as other housing and real estate sales business
Outstanding Orders as April 1, 2019
Total Outstanding Orders
A + B as of Apr. 1, 2019
Units

StudioFamily-type
Condo Bldg. Sales
Hotel Sales
Other housing and realestate sales business

Total

2,238
2,123
1,904
1,054
19
7,338

Amount(¥ million)

Breakdown by delivery timing
During FY 2020/3 A
Units
Amount(¥ million)

From FY 2021/3 B
Units
Amount(¥ million)

44,142 2,238
77,588 1,503
29,428 1,318
25,708664

44,142
55,713
21,347
16,242

0
620
586
390

0
21,875
8,080
9,466

9,657

9,657

0

0

147,102 1,596

39,422

19

186,525 5,742

FY 2020/3 Progress on Outstanding Orders as April 1, 2019
Outstanding Orders
Scheduled Delivery
During FY 2020/3

Units

StudioFamily-type
Condo Bldg. Sales
Hotel Sales
Other housing and real estate sales business
Total

2,238
1,503
1,318
664
19
5,742

Amount A(¥ million)
44,142
55,713
21,347
16,242
9,657
147,102

As of the beginning of FY 2020/3(April 1, 2019),
orders of 147,102 million yen to besales for FY2020/3 have been alreadyreceived and secured up to73.3%
of the sales plan of 200,702
million yen for FY 2020/3 incondo sales, other real estate andresidential houses business
Note:

The amount of outstanding orders is thesum of sales contract completed forAmount C Progression properties with the following status.
• Buildings mainly under construction(¥ million) Rate A/C
and not to be delivered yet
70,901
62.3%• Completed sales contracts
74,75774.5%• Uncompleted transfer of property
24,715
86.4%(before buyers’ registration)
18,29288.8%
Normally, outstanding orders are
12,03580.2% transferred to sales when properties are
200,70273.3% completed and delivered to customers.

Sales Plan for FY 2020/3

28

V. Shareholder Returns

Dividend Trends and Policy➢ Annual dividend per share

FY 2019/3: 40.5 yen (up 11.1 yen, payout ratio of 13.7%)  FY 2020/3: 52.0 yen (up 11.5 yen, payout ratio of 15.0%)➢ Dividend policy (Medium-term Business Plan announced on May 10, 2018)• Increase retained earnings for dividends by expanding operating profit by 10% or greater every year
• Dividend payout ratio: Gradually increase to 20% by the end of FY 2023/3• Annual total dividend amount: Increase by 15% or greater year on year
Annual dividendRecord date

Dividend
Dividend
Total
growth rate dividend
payout(million yen)
YoY
ratio

2Q

Year-end

Total

FY 2020(Forecast)¥26.00¥26.00¥52.00

28.4%

NA

15.0%

FY 2019¥17.50¥23.00¥40.50

37.8%

2,524

13.7%

FY 2018¥12.50¥16.90¥29.40

39.0%

1,762

12.6%

FY 2017¥8.75¥12.40¥21.15

41.0%

1,250

11.8%

FY 2016¥0.00¥15.00¥15.00

20.0%

882

9.8%

Note: The company carried out a 4-for-1 stock split of common shares effective
October 1, 2016.
The stock split is factored into the figures shown above.

¥346.67

EPS
DPS¥296.43¥232.58¥52.00¥178.99¥152.31¥40.50¥29.40¥21.15Year-end¥26.00¥15.00

FY '16

FY '17

Mid-term¥26.00

FY '18FY '19FY '20
Forecast

Shareholder benefit plan and criteria for perks (partially revised from FY 2020/3)
FY 2019/3(To be delivered in theend of June 2019)

100 shares or more andless than 400 shares
400 shares or more

VJA Gift Cardequivalent to 2,000 yen
VJA Gift Cardequivalent to 5,000 yen

FY 2020/3(To be delivered in theend of June 2020)

400 shares or
more

VJA Gift Cardequivalent to 5,000 yen
30

Objective on Share Price and Our Goal with Prioritized Actions

High ROE, Low PER
Trends of PER, ROE andDividendratio payout ratio
PER
ROEpayout
Dividend(Times)

● ROE

25

20

19.4%

*

19.2%

Dividend
Payout Ratio

20.8%

25%

22.1%

13.7%

10

7.5

10% or more growth of operating profit
every year

15%

10%

7.0

Prioritized
Action
(2)

15.0%

9.8%

5

×

6.9

5%

4.6
0

=

11.8%

12.6%

Increase dividend payout ratio
continuously to 20% by FY 2023/3

◆ PER

20%

15

Prioritized
Action(1)

Our Goal

Expect the Increase of
Stock Price Valuation ( ≒ PER)0%
FY'16/3 FY'17/3 FY'18/3 FY'19/3 FY'20/3
Forecast

31

Pressance Corporation Co., Ltd.

(Note) Prospective numbers listed in the earnings outlook and other materials are basedon information available at the time the documents were released and in large partcontain uncertain factors. The actual results may be different depending onchanges in business.
<For inquiries, contact>
IR Section of Business Planning Dept., PressanceCorporation Co., Ltd.
TEL: 06-4793-1650 (main) FAX: 06-4793-1651
E-mail: psc@pressance.co.jp