(REIT) Interim Summary of Financial Results for Fiscal Period Ending January 2016
REIT Securities Issuer:

Samty Residential Investment Corporation(“Samty Residential”)
3459
Tetsuro Kawamoto, Executive Director

Securities Code:
Representative:

Asset Management Company: Samty Asset Management Co., Ltd.
Representative:
Yosuke Masuda, President

Listing: Tokyo Stock Exchange

October 15, 2015

URL: http://www.samty-residential.com/en/
Inquiries: Takeshi Fujiwara
Director
Business Management Department
Phone: +81-3-5220-3841

Scheduled date of submission of semiannual report:

November 24, 2015

Preparation of supplementary interim financial results briefing materials: Yes
Holding of interim financial results briefing session:
Yes (for institutional investors and analysts)(Amounts are rounded down to the nearest million yen)1.

Status of Management and Assets for Fiscal Period Ending January 2016 (for interim period from March 16, 2015 to August 31, 2015)(1) Management Status

Interim period
ended Aug. 2015

Operating revenue
mn yen%511–

Operating income
mn yen211(% figures are the rate of period-on-period increase (decrease))
Ordinary income
Net income%
mn yen%mn yen
%
–

(136)

–

(137)

–

Net income
per unityenInterim period(2,063)
ended Aug. 2015
(Note 1) The calculation period for the interim period ended August 2015 of Samty Residential is a period of 169 days from March 16,
2015 to August 31, 2015.
(Note 2) Net income per unit is calculated by dividing net income by the daily weighted average number of investment units (66,525
units).
(Note 3) Percentage figures for operating revenue, operating income, ordinary income and net income are the rate of period-on-period
increase (decrease), but are not applicable for the interim period ended August 2015 because it is the first fiscal period.
(Note 4) In the calculation period for the interim period ended August 2015, investment unit issuance expenses and deferredorganization expenses totaling 129 million yen are recorded as one-time expenses, resulting in ordinary loss of 136 million yen
and net loss of 137 million yen.
(2) Financial Position

Interim period
ended Aug. 2015

Total assets
mn yen33,920(3) Status of Cash FlowsNet cashprovided by (used in)operating activities
mn yenInterim period
69
ended Aug. 2015

Net assets

Equity ratio

Net assets per unit

mn yen%yen

15,877

46.8

97,207

Net cashprovided by (used in)investing activities
mn yenNet cashprovided by (used in)financing activities
mn yen(32,107)33,306-1-

Cash and cash equivalents
at end of period
mn yen1,268

2.

Forecast of Management Status for Fiscal Period Ending January 2016 (from March 16, 2015 to January 31, 2016) and Fiscal PeriodEnding July 2016 (from February 1, 2016 to July 31, 2016)(% figures are the rate of period-on-period increase (decrease))

Operatingrevenue

Fiscal period
ending Jan. 2016

OperatingincomeOrdinary
incomemn yen%mn yen%mn yen

%

1,390

–

602

–

119

–

Distribution
Distribution
per unit
per unit
Distribution(including
Net income(excluding in excess of
distribution
distribution earnings
in excess ofin excess of
per unit
earnings)
earnings)
mn yen
%
yen
yen
yen
119

–

1,512

730

782

mn yen%mn yen%mn yen%mn yen
%
yen
yen
yen
Fiscal period
1,070 (23.0)
427 (28.9)
329 175.1
329 176.2
2,591
2,017
574
ending July 2016
(Reference) Forecast net income per unit for fiscal period ending January 2016: 730 yen
Forecast net income per unit for fiscal period ending July 2016:
2,017 yen
(Note 1) Distribution per unit is calculated based on the total number of investment units issued and outstanding at the end of theinterim period ended August 2015 of 163,340 units.
(Note 2) Percentage figures for operating revenue, operating income, ordinary income and net income are the rate of period-on-period
increase (decrease), but are not applicable for the fiscal period ending January 2016 because it is the first fiscal period.

*

Other
(1) Changes in Accounting Policies, Changes in Accounting Estimates and Retrospective Restatement① Changes in accounting policies accompanying amendments to accounting standards, etc.: No② Changes in accounting policies other than ①:No③ Changes in accounting estimates:
No④ Retrospective restatement:No(2) Total Number of Investment Units Issued and Outstanding① Total number of investment units issued and outstanding (including own investment units) at end of period
Interim period ended August 2015
163,340 units② Number of own investment units at end of period
Interim period ended August 2015
0 units*

Presentation of the status of implementation of interim audit procedures
At the time of disclosure of this interim summary of financial results, audit procedures for interim financial statements pursuant to
the Financial Instruments and Exchange Act have not been completed.

*

Explanation of the appropriate use of the forecast of management status, and other matters of special note
The management status outlook and other forward-looking statements contained in this document are based on information
currently available to and certain assumptions deemed reasonable by Samty Residential, and actual management status, etc. may
differ materially due to various factors. In addition, the forecast is not a guarantee of the amount of distributions.
The first fiscal period of Samty Residential is from March 16, 2015 to January 31, 2016, but an interim settlement of accounts is
conducted because the fiscal period exceeds nine months. Please note that subsequent fiscal periods of Samty Residential end on
the last day of January and the last day of July.

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Samty Residential Investment Corporation (3459) Interim Summary of Financial Results for Fiscal Period Ending January 2016
Assumptions Underlying Forecast of Management Status for Fiscal Period Ending January 2016 and Fiscal Period Ending July 2016
Item
Fiscal period

Assumption
・ Fiscal period ending January 2016 (from March 16, 2015 to January 31, 2016) (322 days)
・ Fiscal period ending July 2016 (from February 1, 2016 to July 31, 2016) (182 days)・Managed assets

・・Operatingrevenue・・・Operatingexpenses・・・

Non-operating
expenses

Borrowings

Fiscal period ending January 2016 and fiscal period ending July 2016: It is assumed that Samty Residential willcontinue to own the trust beneficiary interests in real estate for 28 properties it owns and the trust beneficiaryinterests in real estate for 1 property it acquired on October 1, 2015 (S-FORT Gakuenmae) for a total of trust
beneficiary interests in real estate for 29 properties (the “already acquired assets and additionally acquired
asset”) through the end of the fiscal period ending July 2016, and that no other property will be newly
acquired.
In practice, change may arise due to acquisition of new properties or disposition of owned properties, etc.
Real estate rent revenue from the already acquired assets and additionally acquired asset is calculated bytaking into account the information provided from the previous owners, etc. of the respective properties, thelease agreements concluded, the market trends and other factors.
Operating revenue is based on the assumption that there will be no accrual of gain or loss on sales of realestate properties.
Expenses related to the rent business, which are the principal operating expenses, are calculated on the basisof past results of Samty Residential (or the past results disclosed by the previous owners, etc. for the periods
for which Samty Residential does not have past results), taking into account the fluctuation factors of
expenses.
Real estate rent income (excluding gain on sales of real estate properties) after deducting expenses related to
the rent business (including depreciation) is assumed to be 807 million yen for the fiscal period ending January
2016 and 569 million yen for the fiscal period ending July 2016.
In general practice, the property taxes and city planning taxes, etc. levied on transactions of real estate
properties are settled at the time of acquisition by prorating for the period with the previous owner. However,as Samty Residential includes the amount equivalent to such settlement in the acquisition costs for theproperty, the amount is not recorded as expenses.
Depreciation is calculated using the straight line method, and is assumed to be 365 million yen for the fiscal
period ending January 2016 and 268 million yen for the fiscal period ending July 2016.
Repair expenses for buildings are assumed to be 12 million yen for the fiscal period ending January 2016 and 9
million yen for the fiscal period ending July 2016, based on the medium- to long-term repair plans prepared by
the asset management company. However, the amounts could differ significantly from the assumed figures, as
increased or additional repair expenses may arise due to unpredictable factors.

・ Non-operating expenses are assumed to be 482 million yen for the fiscal period ending January 2016. The
amount is assumed to include 352 million yen as interest expenses and other borrowing-related expenses, aswell as one-time expenses in the fiscal period ending January 2016 comprising 70 million yen as expenses forestablishing Samty Residential and 58 million yen as expenses related to the issuance, listing and public
offering of new investment units.
・ For the fiscal period ending July 2016, 98 million yen is assumed as interest expenses and other borrowingrelated expenses.
・Total interest-bearing liabilities are assumed to be 17,812 million yen at the end of the fiscal period ending
January 2016 and 16,462 million yen at the end of the fiscal period ending July 2016.

The total number of investment units issued and outstanding is assumed to be 163,340 units, which is thefigure as of today.
・ It is assumed that there will be no change in the number of investment units due to issuance of new
investment units, etc. through the end of the fiscal period ending January 2016 and the end of the fiscal period
ending July 2016.

・
Investment units-3-

Samty Residential Investment Corporation (3459) Interim Summary of Financial Results for Fiscal Period Ending January 2016
Item

Assumption

Distribution
per unit(excluding
distribution
in excess ofearnings)

・ Distribution per unit (excluding distribution in excess of earnings) is calculated on the assumption that theamount of earnings is distributed pursuant to the cash distribution method stipulated in Samty Residential’s
Articles of Incorporation.
・ There is the possibility that the distribution per unit (excluding distribution in excess of earnings) may vary due
to various factors, including changes of managed assets, variation in real estate rental revenue in accordancewith changes of tenants, and occurrence of unpredicted repairs.

Distribution
in excess ofearnings
per unit

・ Distribution in excess of earnings per unit is calculated pursuant to the cash distribution method stipulated in
Samty Residential’s Articles of Incorporation as well as its internal regulations.
・ As of today, Samty Residential believes that no significant deterioration is likely to take place for the current
external economic environment, the real estate market conditions and Samty Residential’s financial conditions.
・ Samty Residential anticipates that there will be ample opportunities, etc. to acquire new properties asinvestments that should contribute to increasing portfolio earnings power in the fiscal period ending January
2016 and the fiscal period ending July 2016, although part of the real estate transaction market appears to be
overheated. Accordingly, it is highly necessary to reserve certain amounts of funds to make it possible torespond to such opportunities flexibly. On the other hand, in consideration of such factors as Samty
Residential’s financial conditions and the prospect of its ability to refinance the borrowings, Samty Residentialconsiders itself to not be in a position in the said two fiscal periods to allocate funds preferentially forreinforcing its financial base through such measures as reducing interest-bearing liabilities. While depreciation
for the already acquired assets and additionally acquired asset (29 properties in total) is anticipated to be 365
million yen for the fiscal period ending January 2016 and 268 million yen for the fiscal period ending July 2016,
the six-month average of the sum total of the estimated urgent repair expenses, estimated short-term repair
expenses and estimated long-term repair expenses for the said 29 properties described in the building
condition survey reports will be only 29 million yen (estimated to be 33 million yen for the fiscal period ending
January 2016 and 24 million yen for the fiscal period ending July 2016). Accordingly, Samty Residential expects
to have residual free cash flow even after making certain reserves from the cash and deposits on handequivalent to the depreciation amount at the end of each fiscal period as reserves for capital expenditures tomaintain the building functions, etc., as funds equivalent to the estimated amount of working capital, etc. andas reserves in preparation for investments that should contribute to increasing portfolio earnings power asstated above.
・ Considering the above, Samty Residential believes as of today that it is appropriate to implement distribution
in excess of earnings for the fiscal period ending January 2016 and the fiscal period ending July 2016, andanticipates 127 million yen and 93 million yen, respectively, as total distribution in excess of earnings (Note 1).
In this case, the total distribution in excess of earnings will be equivalent to 35.0% and 35.0%, respectively, ofthe depreciation expected to accrue in each fiscal period, and the payout ratio (Note 2) is anticipated to be
51.0% and 70.8%, respectively.
(Note 1) Distribution in excess of earnings shall be implemented only when the total continuous appraisal value of the real estate
properties owned by Samty Residential at the end of the relevant fiscal period is greater than the total book value of theowned real estate properties plus total reserves for the planned construction work amount (capital expenditures) of therepair and renewal expenses scheduled for the next fiscal period as well as other planned reserves. If these requirements
are not satisfied, therefore, Samty Residential will not implement distribution in excess of earnings for the 1st fiscal period
ending January 2016 and the 2nd fiscal period ending July 2016 despite the above forecast.
Moreover, if any significant deterioration or other changes newly occur in the external economic environment, the realestate market conditions or Samty Residential’s financial conditions, etc., the policy as of today to implement distribution inexcess of earnings for the 1st fiscal period ending January 2016 and the 2nd fiscal period ending July 2016 as part of the
cash management may be changed and, despite the above forecast, distribution in excess of earnings may not be
implemented for the 1st fiscal period ending January 2016 and the 2nd fiscal period ending July 2016. In addition, Samty
Residential believes as of today that it is appropriate to implement distribution in excess of earnings for the 1st fiscal period
ending January 2016 and the 2nd fiscal period ending July 2016 to the extent of the payout ratio (Note 2) not surpassing
around 70% and targeting the amount equivalent to 35% of depreciation in the relevant fiscal period. However, such an
amount or percentage may be reviewed if there newly arises a major change in the revenue and expense structure of theportfolio due to significant additions of new assets, etc. or important changes take place in the financial environment andthe real estate investment trust market conditions, etc. As a result, the amount of distribution in excess of earnings for the
1st fiscal period ending January 2016 and the 2nd fiscal period ending July 2016 as anticipated above may be changed.
(Note 2) “Payout ratio” represents the ratio of total cash distribution, including distribution in excess of earnings, to net income anddepreciation combined.

Other・ It is assumed that there will be no revision to laws and regulations, tax system, accounting standards,
regulations applying to publicly listed companies and rules of The Investment Trusts Association, Japan, etc.
that will impact the aforementioned forecast figures.
・ It is also assumed that there will be no unexpected material changes in general economic trends and realestate market conditions, etc.

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