Consolidated Financial Results for the Second Quarterof the Fiscal Year Ending March 31, 2023
November 10, 2022 released

Company name:
Stock listing:Code number:
URL:
Representative:
Inquiries:

Sun Frontier Fudousan Co., Ltd.
Tokyo Stock Exchange Prime Section
8934
https://www.sunfrt.co.jp
Seiichi Saito, President
Takeshi Hirahara, Executive Officer, General Manager of Corporate Planning Department(Phone: +81-3-5521-1301)
Scheduled date of quarterly securities report submission: November 11, 2022
Scheduled date of dividend payment commencement: December 6, 2022
Supplemental materials for the financial results: Yes
Presentation to explain for the financial results: Yes (For institutional investors and analysts)*Amounts are rounded down to millions of yen.
1.

Consolidated Performance in the Second Quarter of the Fiscal Year Ending March 31, 2023

(1)

Consolidated Operating Results(“¥” indicates millions of yen, percentage figures indicate year-on-year changes.)

Net Sales

Operating Profit

Ordinary Profit¥8,044¥8,035-13.5%¥5,368-8.4%

FY2022/3 2Q¥45,32640.9%¥9,40065.9%¥9,285(Note) Comprehensive income: FY2023/3 2Q: 5,943 millions of yen (-2.3%)(Note) Comprehensive income: FY2022/3 2Q: 6,082 millions of yen (80.4%)
Net Income per Share
Fully Diluted(Yen)
Net income per Share
(Yen)

72.5%

¥5,86269.4

FY2023/3 2Q¥35,333-22.0%-14.4%FY2023/3 2Q

110.44110.34FY2022/3 2Q

120.37120.26Net Income(2) Consolidated Financial Position

Total Assets

Net Assets

Equity Ratio (%)

FY2023/3 2Q¥139,681¥79,16254.3%

FY2022/3¥136,512¥74,452

52.2%(Reference) Total Equity: FY2023/3 2Q: 75,864 millions of yen(Reference) Total Equity: FY2022/3 : 71,282 millions of yen
2.

Cash Dividends
Cash Dividends per Share (yen)
2nd quarter end
3rd quarter end
Yearend
FY2022/3
21.00
23.00
FY2023/3
23.00
FY2023/3 (Forecast)
23.00(Note) Changes from the latest released dividend forecast: No.
1st quarter end

3.

Annual Total
44.00
46.00

Forecast for Consolidated Financial Results for FY2023/3 (April 1, 2022 to March 31, 2023)(“¥” indicates millions of yen, percentage figures indicate year-on-year changes.)

Net Sales

Operating Profit

Ordinary Profit

FY2023/3 ¥84,000
17.9% ¥13,300
9.7%(Note) Changes from the latest released forecast: No.

¥12,800-1

4.8%

Profit Attributable to Owners

EPS

of Parent(yen)¥8,30011.9%

170.76

※ Notes(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in changing
scope of consolidation): None
New companies: Excluded companies: (2) Adaption of special accounting practices in the preparation of quarterly consolidated financial statements
None(3) Changes in accounting policies, estimates and retrospective restatement
1) Changes in accounting policies due to changes in accounting standard:
2) Changes in accounting policies other than 1) above:3) Changes in accounting estimates:
4) Retrospective restatement:
None

Yes
None
None

(4) Number of outstanding shares (common stock)1) Number of outstanding shares at the end
FY2023/3 2Qof the period (including treasury stock):

48,755,500
shares

FY2022/3

48,755,500
shares2) Number of shares of treasury stock at the
FY2023/3 2Q
end of the period:

164,980shares

FY2022/3

56,644
shares

48,606,722
48,698,856
FY2022/3 2Q
sharesshares(Note) The number of treasury shares at the end of the second quarter of the fiscal year ending March 31, 2023
includes the 143,800 treasury shares acquired based on the resolution of the Board of Directors held on May 13,
2022, after deducting the 35,464 treasury shares disposed of as renumeration of restricted stock on July 21, 2022.
3) Average number of shares for the period: FY2023/3 2Q※ This Summary of Consolidated Financial Results is not subject to review processes under the Financial
Instruments and Exchange Act.
※ Explanation for appropriate use of forecast and other special matters
Earnings per share in the forecast of consolidated financial results for FY2023/3 is calculated based on the
average number of shares for the period 48,606,722 shares.
Forward-looking statements, such as forecast of consolidated financial performance, stated in this document
are based on information currently possessed by the Company as well as certain assumptions deemed rational. It
does not mean that the Company assurances that the contents mentioned in these forward-looking statements will
ever materialize. Actual financial performance may be significantly different from such expectations due tovarious factors. For further information on assumptions used in forecasts, please see Page 7, 1. (3) ForwardLooking Statements such as Consolidated Earnings Forecasts.

-2

Accompanying Materials
Contents
1. Qualitative information regarding consolidated performance for the first six months ................................. 4(1) Business Performance.......................................................................................................................... 4(2) Consolidated Financial Position .......................................................................................................... 7(3) Forward-Looking Statements such as Consolidated Earnings Forecasts ............................................ 7
2．Quarterly Consolidated Financial Statements and Key Notes .................................................................... 8(1) Consolidated Balance Sheet ................................................................................................................ 8(2) Consolidated Statements of Income and Comprehensive Income ..................................................... 10(3) Notes to Consolidated Financial Statements ..................................................................................... 12(Notes to Assumption of Going Concern) ............................................................................................... 12(Notes on Significant Changes in the Amount of Shareholders’ Equity) ................................................ 12(Change of Accounting Policies)............................................................................................................. 13(Additional Information) ......................................................................................................................... 13(Segment Information, etc.)..................................................................................................................... 14(Revenue Recognition) ............................................................................................................................ 15(Significant Subsequent Events) ............................................................................................................. 15-3

1. Qualitative information regarding consolidated performance for the first six months(1) Business Performance
Matters concerning the future in this document are those judged by Sun Frontier as of the end of the second
quarter of the fiscal year ending March 31, 2023.
During the six months ended September 30, 2022, the Japanese economy showed signs of recovery, particularlyin personal consumption and capital investment, as restrictions on economic and social activities eased further
while people shifted towards coexisting with COVID-19. As for the global economy, there are concerns about
stagflation stemming from the economic slowdown caused by the prospect for the prolonged Ukraine issue andinflation and interest rate hikes in various countries.
In the real estate market, the average rent for September in the Tokyo Business District (5 wards of Central
Tokyo: Chiyoda, Chuo, Minato, Shinjuku, and Shibuya) was 20,156 yen (unit price per tsubo), down for the
26th consecutive month (total 2,858 yen / approximately 12%). The average vacancy rate for the same monthmostly remained flat at 6.49% according to a survey by a private research institution, and the overall officemarket remained weak. Meanwhile in the real estate investment market, although institutional investors’ demandremains high overall, the outlook remains unpredictable due to the global monetary tightening phase.
During the six months ended September 30, 2022, in the Group’s core business, the Real Estate Revitalization
Business, sales of relatively large-scale properties decreased compared to the same period of the previous year.
However, the number of units sold was the same year-on-year and we continued to promote sales of real estatewith high profitability and high-quality this period. The Real Estate Service Business continued to show stableperformance. In the Hotel Operation Business, which has been greatly affected by the pandemic of COVID-19,
sales continued to recover as demand kept increasing due to the easing of restrictions on economic and social
activities. In October, the "Nationwide Travel Subsidy Program" was launched to promote domestic tourism andthe restriction on individual travel of foreign tourists was lifted. The business environment is expected to
improve further.
As a result, net sales amounted to 35,333 million yen (down 22.0% YoY), operating profit amounted to 8,044
million yen (down 14.4% YoY), ordinary profit amounted to 8,035 million yen (down 13.5% YoY), and profit
attributable to owners of parent amounted to 5,368 million yen (down 8.4% YoY).
The results of each segment are as follows.
(Real Estate Revitalization Business)
In the Real Estate Revitalization Business, we are engaged in (i) Replanning Business and (ii) Rental Building
Business.
(i) In the Replanning Business, we are performing all processes in-house, from purchasing buildings toplanning value improvements, tenant placement, sales and after-sales support. Sales in the current
consolidated fiscal year were steady due to strong investor enthusiasm. As for purchases, the Group
proactively selects properties while monitoring the impact of macroeconomic fluctuations on the real estatemarket and interest rate trends. In commercialization, we aim to create offices that fit a hybrid working
style and are sought-after even in the new normal, while anticipating changes in urban areas, offices andwork styles. Through coordination with the leasing brokerage division, the Group promoted the attractionof tenants even during the COVID-19 pandemic and finished real estate products with high occupancy rates
and high added value, thereby selling products that meet the expectations of a wide range of clients in Japanand overseas. In the Real Estate Revitalization Business in New York, U.S., we sold one commercialized
property in order to meet the needs of our clients who wish to diversify their asset portfolios. Also, as small-4

lot real estate for specified joint real estate ventures, the Company sold (in three phases) a newly built
medical and educational mall. In the Replanning Business, including the property in New York, 14 buildings
were sold, the same year-on-year. However, sales of relatively large-scale properties owned over the
medium to long term decreased year-on-year. As a result, although year-on-year net sales and profits
decreased, compared to all previous first six months, the period under review marked the fourth highest
level in terms of net sales and profits for the segment.
(ii) In the Rental Building Business, to build a stable revenue base as a “stock business”, the Group will aim toincrease rent income over the medium to long term by utilizing the operational capabilities accumulated in
the real estate service division while increasing the number of rental buildings in the Replanning Business.
Compared with the same period of the previous year, net sales and profit decreased due to a decline in rent
income from short-term ownership properties.
As a result, net sales in the Real Estate Revitalization Business as a whole amounted to 26,255 million yen(down 29.9% YoY) and segment profit amounted to 9,181 million yen (down 17.6% YoY).

(Real Estate Service Business)
In the Real Estate Service Business, we are engaged in (i) Property Management Business, (ii) Building
Maintenance Business, (iii) Sales Brokerage Business, (iv) Leasing Brokerage Business, (v) Conference Room
Rental Business, and (iv) Rent Guarantee Business.
Each of these operating divisions is developing its businesses in the area of small- to medium-sized officebuildings in central Tokyo by gathering their expertise and working together. This is also the foundation forgenerating high profitability in the Replanning Business by creating added value through a chain reaction ofexpertise cultivated through originality and ingenuity in the field.
(i) In the Property Management Business, the Company has achieved high-occupancy and high-profitability
building management by raising the satisfaction level of tenants through attentive property management,
working with the leasing brokerage division to attract tenants, and working to revise the conditions forappropriate rents. As a result of growth in the number of managing buildings, both net sales and profits
increased year-on-year.
End of
September 2020

End of
September 2021

End of
September 2022

Number ofManaging Buildings

403 buildings

403 buildings

444 buildings

Occupancy Rate

96.8%

91.6%

91.9%

(ii) In the Building Maintenance Business, under the slogan "Make Tokyo the Most Beautiful City in the World,"
we provide comprehensive building maintenance services, including inspections to maintain and manage
buildings, cleaning to maintain beauty and comfortable spaces, and renovation work. The Group is promoting
collaboration with the property management division with its strength in high-rise cleaning of exterior
windows and walls using swings, waterproofing work and exterior wall renovation work. As the number of
new managing properties increased, both net sales and profits increased year-on-year.
(iii) In the Sales Brokerage Business, as part of our real estate consulting services, we are responding quickly torequests for consultation from clients of other divisions such as the Property Management Business andLeasing Brokerage Business. The office building business division has worked together to support building
owners manage their buildings and succeeded in concluding sales brokerage contracts based on the trust it-5has built up. As sales brokerage towards investors in Japan and abroad were strong, both net sales and profits
increased year-on-year.
(iv) In the Leasing Brokerage Business, we have developed a service network based in 10 sites, mainly in central
Tokyo, which functions as a window for consultation close to the local building owners. Also, weare reflecting the needs and changes of tenants quickly acquired at the leasing site in research and proposals
for optimal use of office space. Through this product planning in the Replanning Business, we are creating a
new sense of value from our clients’ perspective. Both net sales and profits increased year-on-year as thenumber of contracts concluded went up.
(v) In the Conference Room Rental Business, we have been able to capture continuous use and the demands of
new customer segments by providing services that respond to the changing times and thoroughly
implementing flexible proposal sales to meet clients’ needs through close ties with local communities.
Demand for corporate training and seminars continued to recover as restrictions on economic and social
activities eased further. As a result, net sales increased year-on-year, and while a temporary increase was seen
in expenses associated with the opening of new conference rooms, profits also increased.
(vi) In the Rent Guarantee Business, when rent arrears occur, we provide services tailored to building owners not
only with rent guarantee, but also support until the lease is surrendered, easing the sense of burden in building
management. Consultations from building owners increased due to the increase of vacant rooms and tenantcredit concerns, caused by the outbreak of COVID-19. As a result, the number of new guarantees handledincreased, and both net sales and profits increased year-on-year.
As a result of the above, net sales in the Real Estate Service Business as a whole amounted to 4,367 million yen(up 15.6% YoY) and segment profit amounted to 2,551 million yen (up 19.8% YoY).
(Hotel and Tourism Business)
In the Hotel and Tourism Business, we are engaged in (i) Hotel Development Business and (ii) Hotel Operation
Business.
(i) In the Hotel Development Business, while we recorded sales of certain lots of the condominium hotel“HIYORI OCEAN RESORT OKINAWA” in the same period of the previous year, we did not have any salesof properties in the current period, and both net sales and profits decreased year-on-year. Of the three hotels
whose sale was announced at the end of August, two were delivered at the end of October. Net sales andprofits associated with this transaction will be recorded in the 9 months ending December 31, 2022. The
impact of this transaction on the Company's consolidated financial results has been incorporated into theforecast for consolidated financial results for the fiscal year ending March 31, 2023 announced in the“Consolidated Financial Results for the Fiscal Year Ended March 31, 2022” dated May 13, 2022.
(ii) In the Hotel Operation Business, “Shijo Kawaramachi Onsen Sora Niwa Terrace Kyoto” and “Shijo
Kawaramachi Onsen Bettei Kamogawa” opened in June, and we operate a total of 22 hotels (2,612 rooms)
as of November 10th. Demand for domestic tourism has been further recovering due to the easing ofrestrictions on economic and social activities. Also, the occupancy rate and room unit prices are continuing
to rise. As a result, net sales increased and the amount of loss decreased year-on-year.
As a result of the above, net sales in the Hotel and Tourism Business as a whole amounted to 4,553 million yen(up 37.9% YoY) and the segment loss amounted to 334 million yen (compared with segment loss of 970 million
yen in the same period of the previous fiscal year).

-6(Other Business)
In Other Business, we are engaged in (i) Overseas Development Business and (ii) Construction Business.
(i) In the Overseas Development Business, we have expanded into Southeast Asian countries where growth isexpected. We are developing real estate mainly for condominiums and houses using Japanese advanced
construction technology and are focusing on providing Asian people with a firsthand experience of Japanesequality. In the current period, although we had sales such as condominium management revenue in Vietnam,
sales decreased year on year in reaction to the sales of properties in Vietnam and Indonesia which wasrecorded in the same period of the previous fiscal year, and a loss was recorded due to a loss on valuation of
inventories in Indonesia.
(ii) In the Construction Business, the Group is engaged in renewal planning, repair and reform, interior finishingwork and telecommunications work for commercial buildings. Compared with the same period of theprevious fiscal year, sales for the current period dropped due to a decrease in construction on hand led by
fewer orders received. However, profits increased as the number of telecommunications works with highgross profit margin increased.
As a result of the above, net sales in the Other Business amounted to 620 million yen (down 40.9% YoY) andthe segment profit amounted to 86 million yen (up 0.2% YoY).
(2) Consolidated Financial Position
Total assets as of September 30, 2022 amounted to 139,681 million yen (up 2.3% YoY), liabilities amounted to60,518 million yen (down 2.5% YoY) and net assets amounted to 79,162 million yen (up 6.3% YoY).
The increase in total assets was mainly due to an increase of 6,040 million yen in cash and deposits and anincrease of 17,353 million yen in real estate for sale, despite a decrease of 17,677 million yen in real estate forsale in process, a decrease of 1,166 million yen in buildings under property, plant and equipment, and a decreaseof 2,434 million yen in land.
The main factors for the decrease in liabilities were a decrease of 1,710 million yen in current portion of longterm borrowings, a decrease of 726 million yen in income taxes payable and a decrease of 756 million yen in
long-term borrowings, despite an increase of 1,062 million yen in accounts payable - trade.
The increase in net assets was mainly due to the recording of 5,368 million yen in profit attributable to ownersof parent, despite the payment of 1,121 million yen in year-end dividends.
Equity ratio increased 2.1 percentage points to 54.3%.
(3) Forward-Looking Statements such as Consolidated Earnings Forecasts
As for the results for the fiscal year ending March 31, 2023, there are no changes to the forecast figuresannounced on May 13, 2022.

-7

2．Quarterly Consolidated Financial Statements and Key Notes(1) Consolidated Balance Sheet(Unit: million yen)
As of March 31, 2022
AssetsCurrent assets
Cash and time deposits
Notes, accounts receivable, and contract
assetsReal estate for sale
Real estate for sale in process
Costs of uncompleted construction
contracts
Supplies
Other
Allowance for doubtful accounts
Total current assets
Non-current assets
Property, plant and equipment
Buildings (net amount)
Land
Other (net amount)
Total property, plant and equipment
Intangible assets
Goodwill
Other
Total intangible assets
Investments and other assets
Guarantee deposits
Deferred tax assets
Other
Allowance for doubtful accounts
Total investments and other assets
Total non-current assets
Total assets-8

As of September 30, 2022

30,05336,093945

1,342

14,22262,934

31,57645,256

100

236

83
2,603
(21)
110,920

85
3,044
(9)
117,625

7,876
10,046872
18,796

6,710
7,612
819
15,142

408
164
572

375
282
658

4,726
1,036
460
(0)
6,222
25,591
136,512

4,940
1,036
278
(0)
6,255
22,056
139,681

(Unit: million yen)
As of March 31, 2022
Liabilities
Current liabilities
Accounts payable - trade
Short-term borrowings
Current portion of long-term borrowings
Income taxes payable
Provision for bonuses
Provision for bonuses for directors (andother officers)
Provision for fulfillment of guarantees
Other
Total current liabilities
Non-current liabilities
Long-term borrowings
Retirement benefit liability
Provision for share-based remuneration
Other
Total non-current liabilities
Total liabilities
Net Assets
Shareholders' equity
Share capital
Capital surplus
Retained Earnings
Treasury shares
Total shareholders' equity
Accumulated other comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Total accumulated other comprehensive
incomeShare acquisition rights
Non-controlling interests
Total net assets
Total liabilities and net assets-9

As of September 30, 2022

1,345
30
6,874
3,528
191

2,407
77
5,163
2,802
215

73

35

39
4,126
16,21035
4,456
15,194

44,1696
68
1,605
45,84962,06043,4135
76
1,828
45,32460,518

11,965
6,445
52,917(67)
71,26011,965
6,445
57,164(180)
75,394

3

2

19

467

22

470

30
3,139
74,452
136,51230
3,267
79,162
139,681(2) Consolidated Statements of Income and Comprehensive Income
Consolidated Statement of Income(Unit: million yen)
For the six months ended
September 30, 2021

For the six months ended
September 30, 2022

45,32632,337
12,9883,587
9,400

35,33323,534
11,798
3,753
8,044

16
1
98
44
161

23
179
43
24
271

211
65
276
9,285

241
39
281
8,035

0
-

－
101

122
122

－
101

254
0
254
9,154
3,301
(6)
3,295
5,858
(3)
5,862

22
－
－
22
8,114
2,478
172
2,650
5,464
95
5,368

Net sales
Cost of sales
Gross profit
Selling, general and administrative expenses
Operating profit
Non-operating income
Interest and dividend income
Foreign exchange gains
Subsidy income
Other
Total non-operating income
Non-operating expenses
Interest expenses
Other
Total non-operating expenses
Ordinary profit
Extraordinary income
Gain on sales of non-current assets
Gain on sale of shares of subsidiaries andassociates
Gain on bargain purchaseTotal extraordinary income
Extraordinary loss
Impairment loss
Settlement money
Other
Total extraordinary losses
Profit before income taxes
Income taxes - current
Income taxes - deferred
Total income taxes
ProfitProfit attributable to non-controlling interests
Profit attributable to owners of parent-10

Consolidated Statement of Comprehensive Income(Unit: million yen)
For the six months ended
September 30, 2021

For the six months ended
September 30, 2022

5,858

5,464

0

(0)

223
223
6,082

480
479
5,943

6,074
7

5,816
127

ProfitOther comprehensive income
Valuation difference on available-for-salesecurities
Foreign currency translation adjustment
Total other comprehensive income
Comprehensive income
Comprehensive income attributable to
Owners of parent
Non-controlling interests-11(3) Notes to Consolidated Financial Statements(Notes to Assumption of Going Concern)
Not applicable.
(Notes on Significant Changes in the Amount of Shareholders’ Equity)
I For FY2022/3 2Q (April 1, 2021 to September 30, 2021)
1. Dividend paid
Resolution

Type of shares

Total dividends(million yen)

Dividends per share(yen)

Record date

Effective date

Source ofdividends

Annual General
Meeting ofCommon shares
2,047
42.00 March 31, 2021 June 23, 2021 Retained earnings
Shareholders,June 22, 2021
Note: The total amount of dividends decided at the Annual General Meeting of Shareholders on June 22, 2021 includes dividends of2 million yen for the Company's shares held by the trust account of the Employee Stock Ownership Plan (J-ESOP).

2. Dividends for which the record date is during FY2022/3 2Q and the effective date is after the last day of
FY2022/3 2Q
Resolution

Type of shares

Board ofDirectors,
November 9,
2021

Common shares

Total dividends(million yen)

1,023

Dividends per share
(yen)

21.00

Record date

Effective date

Source ofdividends

September 30,
December 7, 2021 Retained earnings
2021

II For FY2023/3 2Q (April 1, 2022 to September 30, 2022)
1. Dividend paid
Resolution

Type of shares

Total dividends(million yen)

Dividends per share(yen)

Record date

Effective date

Source ofdividends

Annual General
Meeting ofCommon shares
1,121
23.00 March 31, 2022 June 22, 2022 Retained earnings
Shareholders,June 21, 2022
Note: The total amount of dividends decided at the Annual General Meeting of Shareholders on June 21, 2022 includes dividends of 1
million yen for the Company's shares held by the trust account of the Employee Stock Ownership Plan (J-ESOP).

2. Dividends for which the record date is during FY2023/3 2Q and the effective date is after the last day of
FY2023/3 2Q
Resolution

Type of shares

Board ofDirectors,
November 10,
2022

Common shares

Total dividends(million yen)

1,118

Dividends per share
(yen)

23.00

Record date

Effective date

Source ofdividends

September 30,
December 6, 2022 Retained earnings
2022

3. Significant changes in shareholders' equity
Based on the resolution of Board of Directors meeting held on May 13, 2022, the Company purchased
143,800 treasury shares. The Company also disposed of 35,464 treasury shares with a due date of July 21,
2022 as a remuneration of restricted shares. As a result, treasury shares increased by 112 million yen during
the 6 months ended September 30, 2022, and stands at 180 million yen as of the end of the period.

-12(Change of Accounting Policies)“Implementation Guidance on Accounting Standard for Fair Value Measurement” (ASBJ Guidance No. 31, June17, 2021, hereinafter referred to as “Fair Value Measurement Implementation Guidance”) has been applied fromthe beginning of the first quarter of the fiscal year, and in accordance with the transitional treatment set forth inParagraph 27-2 of the Fair Value Measurement Implementation Guidance, the new accounting policies stipulated
in the Fair Value Measurement Implementation Guidance will be applied into the future.
The application of this accounting standard has no impact on the consolidated financial statements for the period
under review.
(Additional Information)
1. Accounting Estimates for the Impact of the Spread of COVID-19 Infections
There have been no material changes to assumptions regarding the impact of the spread of COVID-19
infections described in the “Significant Accounting Estimates” in the Annual Securities Report for the previous
fiscal year.
2. Transactions of Delivering the Company’s Own Shares to Employees etc. through Trusts
The Company conducts transactions to deliver its own shares through trust for the purpose of employee welfare.
(i) Overview of transaction
The plan provides the Company's shares to employees of the Company who meet certain requirements basedon the share benefit regulations established by the Company in advance.
The Company will grant points to employees who satisfy certain conditions at the end of the fiscal year, andwhen they acquire the right to receive benefits, the Company shares corresponding to the granted points will
be delivered. The shares to be granted to employees are acquired in the future with the money set in trust inadvance and managed separately as trust assets.
The total amount method is applied to the Employee Stock Ownership Plan (J-ESOP) in accordance with the“Practical Solution on Transactions of Delivering the Company’s Own Shares to Employees etc. throughTrusts” (ASBJ PITF No. 30, March 26, 2015).
(ii) Own shares remaining in the trust
The book value of the Company's shares remaining in the trust (excluding the amount of incidental expenses)
is included in net assets. The book value and number of shares of the treasury shares as of September 30,
2022 were 67 million yen and 56,500 shares.
3. Accounting Treatment and Disclosure with the Application of the Group Tax Sharing System
The Company and certain consolidated domestic subsidiaries shifted from the consolidated taxation system tothe group tax sharing system effective from the first quarter of the fiscal year ending March 31, 2023.
Accordingly, the accounting treatment and disclosure of corporate tax, local corporate tax and tax effectaccounting are based on the “Treatment of the Accounting and Disclosure under the Group Tax Sharing System”(ASBJ PITF No. 42, August 12, 2021, hereinafter “PITF No. 42”). Based on Paragraph 32 (1) of PITF No. 42,
there is deemed to be no effect on the consolidated financial statements for the period under review due to thechange in accounting policies resulting from the application of PITF No. 42.

-13

(Segment Information, etc.)
I For FY 2022/3 2Q (April 1, 2021 to September 30, 2021)
1. Information on net sales and profit for each reportable segment(Unit: million yen)
Reportable segment
Real Estate Real Estate
Revitalization
ServiceBusiness
Business
Net sales
Revenue fromcontracts withcustomers
Other revenue(Note 2)
Net sales to externalcustomers
Internal sales ortransfers between
segments

Hotel andTourism
Business

Subtotal

Other(Note 1)

Total

35,391

3,250

3,244

41,886

1,046

42,933

2,074

262

56

2,393

-

2,393

37,465

3,512

3,300

44,2791,046

45,326

6

264

-

271

3

275

Subtotal

37,472

3,777

3,300

44,5501,050

45,601

Segment profit (loss)

11,138

2,130

(970)

12,29786

12,384

Notes:1. The “Other” segment is a business segment that is not included in the reportable segment and includes the Overseas
Development Business, Construction Business, etc.
2. Other income is rental income, etc., based on ASBJ No. 13 “Accounting Standard for Lease Transactions”.

2. The difference between the total amount of the report segment's profit or loss and the amount recorded in theConsolidated Statement of Income and the main content of the difference (matters related to the difference
adjustment)(Unit: million yen)
ProfitAmountReportable segment total

12,297

Profit in the “Other” category

86

Elimination of intersegment transactions(0)

Corporate expenses (Note)(3,098)

Ordinary profit in the consolidated statement of income

9,285

Note: Corporate expenses are mainly general and administrative expenses not attributable to the reportable segment.

3. Information on impairment loss or goodwill of fixed assets for each reportable segment
Not applicable.

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II For FY2023/3 2Q (April 1, 2022 to September 30, 2022)
1. Information on net sales and profit for each reportable segment(Unit: million yen)
Reportable segment
Real Estate Real Estate
Revitalization
ServiceBusiness
Business
Net sales
Revenue fromcontracts withcustomers
Other revenue(Note 2)
Net sales toexternal customers
Internal sales ortransfers between
segments

Hotel andTourism
Business

Subtotal

Other(Note 1)

Total

24,925

3,285

4,472

32,682618

33,301

1,319

647

64

2,032

-

2,032

26,245

3,933

4,536

34,714618

35,333

10

433

17

461

1

463

Total

26,255

4,367

4,553

35,176620

35,797

Segment profit (loss)

9,181

2,551

(334)

11,39786

11,484

Notes: 1. The “Other” segment is a business segment that is not included in the reportable segment and includes the Overseas
Development Business, Construction Business, etc.
2. Other income is rental income, etc., based on ASBJ No. 13 “Accounting Standard for Lease Transactions”.

2. The difference between the total amount of the report segment's profit or loss and the amount recorded in theConsolidated Statement of Income and the main content of the difference (matters related to the difference
adjustment)(Unit: million yen)
ProfitAmountReportable segment total

11,397

Profit in the “Other” category

86

Elimination of intersegment transactions(12)

Corporate expenses (Note)(3,437)

Ordinary profit in the consolidated statement of income

8,035

Note: Corporate expenses are mainly general and administrative expenses not attributable to the reportable segment.

3. Information on impairment loss or goodwill of fixed assets for each reportable segment
Not applicable.
(Revenue Recognition)
Breakdown of revenue from contracts with customers is as stated in the “Notes to Consolidated Financial
Statements (Segment Information, etc.)”.
(Significant Subsequent Events)
Not applicable.

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