Earnings Results Briefing
for the Six Months EndedSeptember 30, 2017
October 31,2017

Takara Leben Co.,Ltd.

Contents
Summary of Business Results for The Six months
Ended September 30, 2017
Key Topics for The Six months Ended September 30,2017
Plan for The Year Ended March 2018

Business outlook for The Year Ended March 2018
Appendix

・・・・・・

P１

・・・・・・

P８・・・・・・

P 17

・・・・・・

P 19

・・・・・・

P 22

Summary of Business Results for
The Six months Ended September 30, 2017

LEBEN Aoto LICELT1Highlights
The number of new condominium units delivered declined from a year ago.
・The completion of new condominiums was concentrated in the fourth quarter.

The annual plan for mega solar power generation facilities was achieved.
・The first PO by Takara Leben Infrastructure Fund in June

Net sales and each level of income were on a par with the plan.

Properties were purchased in new areas covered by new business bases.
・Sapporo Office, Osaka Branch, Fukuoka Head Office(Takara Leben West Japan)

Progress of contracts (66.5% of the annual plan, 1,600 units)
・The timing of commencement of sales at many condominiums is later than for a typicalyear.
・The gross profit margin rate forecast rose slightly.
2

Highlights by Segment
Real estate sales business

Real estate rental business

Progress made as planned
175 new condominium units recovered
41 detached houses recovered

Purchases of hotels and properties inoperation
Increase in rent revenues

Change in lifestyle  Increase in needs for compact properties

3.0 billion yen’s worth of revenue-generating real estate

Good progress in the supply of properties in regional cities

purchased in the first half (total project cost: ¥11.0 billion)

Expansion of share and establishment of a position in theProactive purchases of land for hotels

Tohoku area

Real estate management business
Steady increase in number of units undermanagement
Units under management expanded steadily.
Over 90% of the units under management were units owned
by other companies.
Replaced other companies in large-scale projects (1,100units).
The number of new contracts (units under management) inPower generation business
Power generation facilities soldFirst PO by the infrastructure fundThe full-year sales plan achieved
Acquisition of larger facilities
Purchases in the secondary market
The recognition of the infrastructure fund market increased.

the first half was 2,300.

3

Consolidated Income Statements
Six months ended
September 30,
2016

Six months ended
September 30,
2017

Net sales

37,12032,225▲13.2％

Operating profit

2,994

2,855

▲4.7％

Ordinary profit

2,457

2,523

2.7％

Net income

1,549

1,624

4.9％

（Unit : Million yen ）YOYchange(%)

Net sales
・Net sales declined 13.2% year on year due to a fall in the number of units of new condominiums delivered, despite a significant
increase in sales of mega solar power generation facilities.
Operating profits
・Operating profits were almost the same as in the previous fiscal year, reflecting an increase in profit from mega solar power
generation facilities.
Ordinary profits, net income
・Operating profits rose due to an increase in profit from equity method investment.

4

Consolidated Segment Information (Net Sales)
YOYchange(%)

Six months ended
September 30, 2016

Six months ended
September 30, 2017

Real estate sales
business

22,296

11,714▲47.5％

Real estate rental
business

2,470

2,713

9.8％

Real estate managementbusiness

1,814

2,00110.3％

Power generation
business

9,194

14,557

58.3％

Other businesses

1,344

1,238

▲7.9％

Total

37,12032,225▲13.2％（ Unit: Million yen）

Real estate sales business・The number of units of new condominiums delivered declined.
Real estate rentals business, real estate management business・Net sales rose steadily in each business due to an increase in revenue-generating real estate and a rise in the number ofunits under management.
Power generation business・Sales of power generation facilities increased.

5Consolidated Balance SheetYear ended
March 31,2017（Unit : Million yen ）Six months
ended
September
30, 2017

YOY change（Unit : Million yen ）Current assets

86,58591,997

6.3％

Cash anddeposits/cash
equivalents

29,78023,833▲20.0％

Inventory assets

49,93360,94422.0％

Real estate held
for salePowergeneration
facilities for sale
Real estate forsale underconstruction
Fixed assets
Total assets

Year ended
March 31,2017

9,658

6,989

▲27.6％

Current liabilities

50,48258,96616.8％

Notes and accounts
payable-trade12,173

4,467▲63.3％

Loans payable (shortterm borrowings andcurrent portion of longterm borrowings))

29,58845,665

54.3％

52,59959,372

12.9％

48,43954,328

12.2％

Total liabilities

103,081

118,338

14.8％

Net assets

36,79237,453

1.8％

Capital

4,819

4,819

―

139,874

155,791

11.4％

Fixed liabilities

7,885

1,596

32,39052,35753,237

139,874▲79.8％

63,749155,791

61.6％
19.7％

11.4％

Six months
ended
YOY change
September
30, 2017

Long-term borrowings

Total liabilities and net
assetsReal estate for sale under construction
・Increase due to steady acquisitions of landBorrowings (short-term, long-term)Fixed assets

・Increases in purchases and the borrowing of fixed assets

・Proactive purchases of revenue-generating real estate6

Consolidated Balance Sheet（Details）
Breakdown of property, plant and equipment
Residence
レジデンス

Office, retail
オフィス・店舗

Infrastru

Hotel
ホテル

インフラ
cture

4,863

9,536

Total

Other
その他

（ Unit: Million yen）

18,86910,725

3,154￥47,146M

Year ended March
2017年3月期
31, 2017

Six months ended
2017年9月末
September
30,2017￥56,445M
18,342

Breakdown of borrowings
Real estate sales
不動産販売事業
business（ Unit: Million yen）37,747

15,655

Real estate

9,861

Power

賃貸事業
rental

発電事業
generation

businessbusiness

27,756

11,048

9,858

2,729

その他事業
Other businesses

Total

3,176

Year ended March
2017年3月期
31, 2017￥79,727M

Six months ended
2017年9月末
September
30,2017￥101,664M
51,92232,811

12,6064,325
7

Key Topics for The Six months
Ended September 30, 2017

LEBEN Kitaayase REVANCE

8

Key Topics Acceleration of Nationwide Operations
Based on Information andCommunications of Japan of the
Ministry of Internal Affairs andCommunications

Demographics of Japan(10 thousand people)
14歳以下人口14 years old

16,00015～64歳人口
15 to 64or younger

Bases of Takara Leben

Takara Leben
Sapporo Office

65歳以上人口65 years old
or olderyears old

12,000

Takara Leben
Hokuriku Office

8,000
4,000

Takara Leben
West Japan
2060年
2060

2055年
2055

2050年
2050

2040年
2040
2045年
2045

2035年
2035

2030年
2030

2025年
2025

2020
2020年

2015
2015年

2005
2005年

2010年
2010

2000年
2000

1995年
1995

1990
1990年

1985年
1995

1980年
1980

1975
1975年

1970
1970年

1965年
1965

1960
1960年

1955
1955年

1950
1950年

0

Takara Leben
TohokuTakara Leben

Takara Leben
Osaka Branch(year)■Aging population, increase in single-personhouseholds and double-income households
 Increase in people choosing not to live indetached houses due to the aging society

Re-tap into demand in the market inaccordance with changes in lifestyles

 Increase in demand for compact properties
due to an increase in single-person households
and double-income households

Expanding supply areas by establishing new bases
9Key Topics

Purchases in New Locations

Hokkaido
Kita 1-jo Nishi, Chuo-ku, Sapporo

Hiroshima

Kita 14-jo Higashi, Higashi-ku, Sapporo

Tenmacho, Nishi-ku, Hiroshima
Otemachi, Naka-ku, HiroshimaKonancho, Fukuyama

Kyoto
Kurumayacho-dori, Nakagyo-ku, Kyoto

EhimeMochidamachi, Matsuyama

Gojo-dori Horikawa-nishi, Shimogyo-ku,
Kyoto

Kitafujiwaramachi, Matsuyama

Gojohashi-higashi, Higashiyama-ku,
Kyoto

Okaido, Matsuyama

Nishishichijo-nishi, Shimogyo-ku, Kyoto

Nagasaki
Tonoocho, Sasebo

Osaka
Eirakuso, Toyonaka
Tennoji-ku, Osaka

10

Key Topics New Entry into Renewal Resale Business・Rising prices of new condominiums
・A significant decline in the supply of units insuburban areas
・Increasing double-income householdsExpansion of the market for used condominiums whose
locations have value
The number of used condominium contracts exceeding
the number of new condominium contracts
Change in consumer attitudes(Change in attitude of shying away from used housing)

Business model
Takara Leben
Purchasing rental properties for families*They can be bought at a lower price thanvacant units.
*For actual users, not for investment

Owning as rental properties until tenants move out

AllianceplannedPlanning to form an alliancewith a company having strong
expertise in renewal andresale business

Renovated after tenants move out
Sold

Short-term target: sales of ¥3.5bn

Long-term target: sales of ¥8.0bn

Changes in lifestyles and values Increasing demand in the used
Changes in lifestyles and values condominium market
condominium market
11Key Topics

Development of Investments
Kyoto
Imperial
PalaceDeveloping an accommodation facility,through conversion, in Kyoto

Nijo-jocastle

・Location
Nushiyacho, Kurumayamachi-dori Oshikojisagaru, Nakagyo-ku, Kyoto, Kyoto Prefecture・Transportation
A minute walk from Karasuma Oike station on thesubway Karasuma Line and Tozai LineKarasuma
Oike station・Facility
11 floors and 72 guest rooms
Kyotostation

Planned to be opened in December 2017
■Act on National Strategic Special Zones
coming into force
Deregulation and tax breaks in special zones■Demand from inbound tourists and thenumber of tourists will increase.
Chronic shortage of accommodation facilities

Business
opportunities to be
expanded

Promote investments proactively
12Key Topics

Development of Investments

Expansion of the hotel business

Locations of planned hotels

・Acquisition of Dormy Inn Matsuyama
The first hotel in the hotel business isplanned to be opened in Matsuyama,
Ehime in the second half of this year.

Kyoto, Kyoto
Matsuyama,
Ehime

Morioka,
Iwate
Mito, Ibaraki

Fukuoka,
Fukuoka

Nagoya, Aichi

Dormy Inn Matsuyama

Continue to develop hotels nationwide
13Key Topics Sale of Facilities to the Infrastructure FundFirst PO of Takara Leben
Infrastructure Fund
Number of facilities soldSevenElectricity sold

30.94 MW

Value of deal

¥12,607 million

Sales per MW¥407 million

Gross margin¥4,670 million

Gross margin per MW¥150 million

Gross margin ratio

37.1%

LS Hokota Power Plant

Number of facilities: 18 Power generating capacity: 50MW
Acquisition value: ¥21.6 billion
Stable earnings and scale expansion through continued sales
14Key Topics

Conclusion of a Commitment Line Contract
for Investing in Infrastructure BusinessOverview
Counterparties

17 financial institutions

Commitment
periodOne year

Borrowing
period36 months maximum

Secured or
unsecured

Unsecured,unguaranteed

Interest rate

TIBOR + 0.5%
(annual rate)

LS Nasu Nakagawa Power Plant

Set a ¥10.0 billion commitment line for proactive
infrastructure investment.
Secure funds  Accelerate acquisitions of facilities and development
15

Key Topics

Development of Overseas BusinessChange in organization
Overseas Business Preparation
Office(direct control of the President)

UpgradedOverseas Business
Promotion OfficeTarget: Vietnam
Comprehensive business operations, notlimited to real estate sales businessPlan to open an office in Hanoi, thecapital, in January 2018
Start specific operations

Reorganization for full-scale entry
16Plan for The Year Ended March
2018

LEBEN Hachiouji GRANDSAGE

17

Plan for Second-halfReal estate sales business

Real estate rental business

Plan to recover 1,425 units of new
condominiums
Pursue a higher gross margin ratio

Acquire and develop land
proactively
The first hotel in the hotelbusiness will open in the second
half.

Promote purchases at new bases
Increase the gross margin ratio

Promote purchases at new bases

Promote purchases in the renewal resale businessAccelerate the replacement of assets

Establish a short detached houses recovery cycle

Diversify exits

Real estate management business

Power generation business

Increase the number of units undermanagement steadily, aiming for
50,000
Expand the number of rental units
under management

Accelerate the acquisition anddevelopment of power generation
facilities
Promote purchases using the commitment line

Acquire new properties of other companies andLook for other types of renewable energy

replace other companies in management ofPromote acquisitions from the secondary market

properties

Increase the recognition of the infrastructure fundExpand fees deriving from property management

market18

Business outlook for The Year
Ended March 2018

LEBEN Kawasaki Oda 1Cyome19

Full-year Consolidated Results Forecast

Six months ended
September 30, 2016
（Actual）

Six months ended
September 30, 2017
（Forecast）

YOY
change(%)

103,599

110,000

6.2％

Operating profit

10,34910,5501.9％

Ordinary profit

9,496

9,500

0.0％

Net income

6,107

6,300

3.1％

（Unit : Million yen ）Net sales

Results are on a par with the plan, and the forecast remains unchanged.

20

Shareholder Returns
Dividend per share（Unit : yen）

20.0

1 half
中間配当金
stdividends

Year-end
期末配当金

dividends

15.0
10.0

5.0
0.0

10.0

10.0

4.0

5.0

5.0

Year ended
2016年3月期
March 2016

Year ended
2017年3月期
March 2017

9.0
3.5
1.5
Year ended
2014年3月期
March 2014

4.0
2.0
Year ended2015年3月期
March 2015

Year ended
2018年3月期（予定）
March 2018（Forecast）

Payout ratio（Unit : ％）4030

20100Year ended
2014年3月期
March 2014

（単位：％）

Year ended
2015年3月期
March 2015

Year ended
2016年3月期
March 2016

Year ended
2017年3月期
March 2017

Year ended（予定）
2018年3月期
March 2018
（Forecast）

Continue to return profits to shareholders actively

（予定）

21

Appendix

ＬＰ TsuruseⅠ

22

Appendix
Operations of major Group companies
Takara Leben Tohoku■Increasing the value of revenue-generating■Ranked No. 1 in the supply of units

properties

in Tohoku for two consecutive years2015: 178 units
2016: 241 units■Development in new regional cities(including Koriyama, Yonezawa, Aizu,and Aomori)All properties in Koriyama were sold in amonth.

Leben Hayama THE MASTER(Koriyama)

Yamagata Tokamachi Building

Takara Leben West Japan■Promoting purchases■First property supplied in the■Developing the hotel

by opening a base in Fukuoka

area covered by West Japanbusiness(Matsuyama, Ehime)

Takara Leben West Japan
Fukuoka Head Office

Takara Leben West Japan
Matsuyama OfficeLeben Matsuyama Ichibancho
THE TOWER

Dormy Inn Matsuyama

23Appendix
Operations of major Group companies
Nikko Takara Corporation■Focusing on purchases of land in■Establishing a short-term

the Tokyo area, especially inrecovery cycle to supplement

central Tokyo

the condominium businessSelling

Plan to sell・Nerima・Suginami
・Setagaya
・Yoga

・Setagaya
・Kichijoji
・Chofu,etc.

■Promoting effective use of land

LP Yoga The Terrace

LP Suginami Shimoigusa

Making proposals to land owners, such as building apartmentbuildings for rent in idle land

Leben Community
Units undermanagement■Building strong relationships withmanagement associations

Takara Leben
タカラレーベン50,000

Property management contract retention
rate: 99.7%

Properties of

他社物件
othercompanies

management companies
The percentage of properties ofother companies has risen.
43.7% (September 30, 2017)

other companies

50%
48%

40,00046%

30,000■Consulting with other

Percentage ofproperties of
他社比率

44%
20,00042%

10,00040%

0(Number of units)

38%
March 20142014年3月期

March 2015
2015年3月期

March 20162016年3月期

March 20172017年3月期

September2017
2017年9月末

24Appendix
Condominiums inTokyo area

Based on data of Real Estate Economic Institute
Number of units sold(left-hand scale)(Number of units)

Average sales price(right-hand scale)

販売戸数（左軸）

70,000(Million yen)

平均販売価格（右軸）6,000

60,0005,500

50,0005,000

40,0004,500

30,0004,000

20,000

3,500

2007
2007年

2008
2008年

2009
2009年

2010
2010年

2011
2011年

2012
2012年

2013
2013年

2014
2014年

2015
2015年

2016
2016年
（year）

Current situation of the market and outlook
Fall in units
supplied

Rise in building
cost

Rise in sales
priceMore emphasis on
customer perspective

Will remain
highGood location:Will rise
No particularfeatures:Will fall

Diversificationof options

OutlookWill notincreasesignificantly25

Appendix
Hokkaido

Land lots for condominiums by area

128
Hokuriku
412

TohokuTakara Leben Sapporo Office

873

Kinki
Tokyo area

54
Chugoku,
Shikoku

Takara Leben
Hokuriku Office

Takara Leben
Tohoku300

Northern Kanto
1,114

Kyusyu,Okinawa
39

2,670

Koshinetsu
Takara Leben
Osaka Branch
Takara Leben West Japan

Takara Leben

222
Tokai
266

Having land for approx. 6,000 units of condominiums in each area
26

Appendix
Power generating capacity ofmega solar power generation facilities(MW)

Capacity
発電規模50Sold
売却済み

Nut sold
未売却

32

Target for year
ending March 2020Being開発中developed

To be

今後の仕入purchased

43200MW75

Break down by FIT rate per MW

3% 9％

Obtain a commitment line of ¥10 billion¥4040円Look for other types of renewable¥3636円¥3232円Obtain a high FIT license earlyenergy88%27

Points for Attention and Enquiries Relating to These Materials

For inquiries:
IR Office, General Planning Division

TEL: 03-6551-2130
FAX: 03-6551-2139
E-mail: irinfo@leben.co.jp
These materials were prepared for the purpose of providing information regarding business performance for the year ended
September 30, 2017, and do not constitute a solicitation for investment in securities issued by Takara Leben Co., Ltd. Thesematerials were prepared based on data available as of September 30, 2017. These materials, as well as answers, projections,estimates, and other information provided in the subsequent question and answer session are based on Takara Leben's best
judgment at the time of the preparation of these materials, and do not constitute a guarantee or promise that anything contained
herein will be realized or achieved, nor do they provide any guarantees or promises with regard to the accuracy or completeness ofthe information contained herein. The content of these materials is subject to change without prior notice.