Samty Residential Investment Corporation (3459) Summary of Financial Results for Fiscal Period Ended January 2020

(REIT) Summary of Financial Results for Fiscal Period Ended January 2020
March 13, 2020
REIT Securities Issuer:
Securities Code:
Representative:

Samty Residential Investment Corporation(“Samty Residential”)
3459
Masafumi Takahashi, Executive Director

Listing: Tokyo Stock Exchange
URL: https://www.samty‐residential.com/en/

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

Inquiries: Hidekazu Nizawa
Director and General Manager ofBusiness Management Department
Phone: +81‐3‐5220‐3841

Scheduled date of submission of securities report:
Scheduled date of commencement of distribution payout:

April 28, 2020
April 22, 2020

Preparation of supplementary financial results briefing materials:
Holding of financial results briefing session:

Yes
Yes (for institutional investors and analysts)(Amounts are rounded down to the nearest million yen)1.

Status of Management and Assets for Fiscal Period Ended January 2020 (from August 1, 2019 to January 31, 2020)(1) Management Status(% figures are the rate of period‐on‐period increase (decrease))
Operating revenue
Operating income
Ordinary income
Net income
mn yen%mn yen%mn yen%mn yen%Fiscal period
3,777
2.7
1,869
2.8
1,499
(8.8)
1,499
(8.8)
ended Jan. 2020
Fiscal period
3,677
14.3
1,818
13.2
1,645
24.5
1,644
24.5
ended July 2019
Net income
per unit
Fiscal period
ended Jan. 2020
Fiscal period
ended July 2019

Ratio of net income
to equityyen%

Ratio of ordinary income
to total assets%

Ratio of ordinary income
to operating revenue
%

2,582

3.0

1.4

39.7

3,261

3.6

1.7

44.7

(2) Distribution Status
Distribution Distribution
Total
Total
Total
Ratio ofper unit
per unit
Distribution distribution distribution(including(excluding
in excess of(including(excluding
distribution
Payoutdistribution
ratio
todistribution distribution
earnings
distribution distribution in excess ofearnings
net assets
in excess of in excess of
per unit
in excess of in excess ofearnings)
earnings)
earnings)
earnings)
yen
yen
yen
mn yenmn yenmn yen%%Fiscal period
2,877
2,530
347
1,704
1,499
205
100.0
2.7
ended Jan. 2020
Fiscal period
3,723
3,261
462
1,876
1,643
232
100.0
3.6
ended July 2019
(Note 1) The entire amount of Total distribution in excess of earnings is refund of capital contribution to unitholders applicable to
distribution reducing unitholders’ capital for tax purpose.
(Note 2) The ratios of decrease in surplus, etc. from implementing distribution in excess of earnings (refund of capital contribution tounitholders applicable to distribution reducing unitholders’ capital for tax purpose) in the fiscal period ended January 2020 andthe fiscal period ended July 2019 are 0.004 and 0.005, respectively.
(Note 3) Payout ratio is calculated by the following formula.
Total distribution (excluding distribution in excess of earnings) ÷ Net income × 100(3) Financial Position
Total assets
mn yenFiscal period
ended Jan. 2020
Fiscal period
ended July 2019

Net assets

Equity ratio

Net assets per unit

mn yen%yen

116,327

55,74947.994,076

97,15945,79047.1

90,835Samty Residential Investment Corporation (3459) Summary of Financial Results for Fiscal Period Ended January 2020
(4) Status of Cash FlowsNet cashprovided by (used in)operating activities
mn yenNet cashprovided by (used in)investing activities
mn yenNet cashprovided by (used in)financing activities
mn yen

3,002(19,467)

17,280

4,506

5,174

(5,846)

(299)

3,691

Fiscal period
ended Jan. 2020
Fiscal period
ended July 20192.

mn yenForecasts of Management Status for Fiscal Periods Ending July 2020 (from February 1, 2020 to July 31, 2020) and January 2021 (fromAugust 1, 2020 to January 31, 2021)(% figures are the rate of period‐on‐period increase (decrease))

Operatingrevenue

OperatingincomeOrdinary
incomeDistribution
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

mn yen% mn yen% mn yen
Fiscal period
3,791
0.4
1,705
(8.8) 1,370(8.7) 1,369(8.7)
ending July 2020
Fiscal period
3,739(1.4) 1,697(0.5) 1,517
10.7
1,516
10.8
ending Jan. 2021
(Reference) Forecast net income per unit for fiscal period ending July 2020: 2,310 yen.
Forecast net income per unit for fiscal period ending January 2021: 2,558 yen.
*

Cash and cash equivalents
at end of period

2,701

2,310

391

2,909

2,558

351

Other
(1) Changes in Accounting Policies, Changes in Accounting Estimates and Retrospective Restatement① Changes in accounting policies accompanying amendments to accounting standards, etc.: NoNo② Changes in accoun ng policies other than ①:③ 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
Fiscal period ended January 2020
592,600 units
Fiscal period ended July 2019504,100 units② Number of own investment units at end of period
Fiscal period ended January 2020
Fiscal period ended July 2019

0 units
0 units*Summary of financial results are exempt from audit by a certified public accountant or an auditing firm.
*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.

Samty Residential Investment Corporation (3459) Summary of Financial Results for Fiscal Period Ended January 2020
Assumptions Underlying Forecasts of Management Status for Fiscal Period Ending July 2020 and for Fiscal Period Ending January 2021
Item
Fiscal period

Managed assets

Operatingrevenue

OperatingexpensesNon‐operating
revenue

Non‐operating
expenses

Interest‐bearing
liabilities

Investment units

Distribution
per unit(excluding
distribution
in excess ofearnings)

Assumption
・ Fiscal period ending July 2020 (from February 1, 2020 to July 31, 2020) (182 days)
・ Fiscal period ending January 2021 (from August 1, 2020 to January 31, 2021) (184 days)
・ For the fiscal period ending July 2020, it is assumed that Samty Residential will continue to own 118 properties
for real estate/trust beneficiary interests in real estate which it owns as of today through the end of the fiscal
period ending July 2020, and that no other properties will be newly acquired or disposed.
・ For the fiscal period ending January 2021, it is assumed that Samty Residential will continue to own 118
properties for real estate/trust beneficiary interests in real estate which it owns as of today through the end of
the fiscal period ending January 2021, and that no other property will be newly acquired or disposed.
・ In practice, change may arise due to acquisition of new properties or disposition of owned properties, etc.
・ Real estate rent revenue is calculated on the basis of historical data (or the past results disclosed by the previous
owners, etc. for the periods for which Samty Residential does not have past results) and by taking into accountthe status of leasing.
・ Operating revenue is based on the assumption that there will be no accrual of gain or loss on the sale of realestate or other 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 forwhich 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 (excluding depreciation) is assumed to be 2,985 million yen for the fiscal period ending July
2020 and 2,976 million yen for the fiscal period ending January 2021.
・ The property taxes and city planning taxes, etc. to be recorded as expenses are assumed to be 233 million yen
for the fiscal period ending July 2020 and 233 million yen for the fiscal period ending January 2021.
・ Depreciation is calculated using the straight‐line method and is assumed to be 773 million yen for the period
ending July 2020 and 770 million yen for the period ending January 2021.
・ Repair expenses for buildings are assumed to be 147 million yen for the period ending July 2020 and 116 million
yen for the period ending January 2021, 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 increasedor additional repair expenses may arise due to unpredictable factors.
・ In the fiscal period ending January 2021, since the provision for adjustment of the amount of tax deductions fortaxable purchase in case of significant changes in the proportion of taxable revenues as defined in Article 33 of
the Consumption Tax Act will be applicable, non‐operating revenue of 150 million yen is assumed to be posted.
・ As for amortized expenses for issuance of investment units, 9 million yen in the fiscal period ending July 2020
and 10 million yen in the fiscal period ending January 2021 are assumed.
・ As for amortized expenses for issuance of investment corporation bonds, 5 million yen in the fiscal period ending
July 2020 and 2 million yen in the fiscal period ending January 2021 are assumed.
・ Interest expenses and other borrowing related expenses are assumed to be 319 million yen for the fiscal period
ending July 2020 and 317 million yen for the fiscal period ending January 2021.
・ The balance of Samty Residential’s interest‐bearing debt as of the date of this document is outstanding loans of
56,985 million yen and outstanding investment corporation bonds of 2,000 million yen.
・ It is assumed that the entire amount of 3,000 million yen in loans maturing in the fiscal period ending July 2020
will be refinanced.
・ It is assumed that the entire amount of 5,600 million yen in loans maturing in the fiscal period ending January
2021 will be refinanced in the fiscal period ending July 2020. In addition, it is assumed that the entire amount of
1,000 million yen in investment corporation bonds maturing in the fiscal period ending January 2021 will be
redeemed by the maturity date.
・ Based on the assumptions above, the balance of interest‐bearing debt at the end of the fiscal period ending July
2020 is assumed to be outstanding loans of 56,985 million yen and outstanding investment corporation bondsof 2,000 million yen, and the balance of interest‐bearing debt at the end of the fiscal period ending January 2021
is assumed to be outstanding loans of 56,985 million yen and outstanding investment corporation bonds of 1,000
million yen.
・ The total number of investment units issued and outstanding is assumed to be 592,600 units, which is the figure
as of today.
・ In addition to the above, it is assumed that there will be no change in the number of investment units due toissuance of new investment units, etc. through the end of the fiscal period ending July 2020 and through theend of the fiscal period ending January 2021.
・ 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.

Samty Residential Investment Corporation (3459) Summary of Financial Results for Fiscal Period Ended January 2020
Item

Distribution
in excess ofearnings
per unit

Other

Assumption
・ 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 the asset management company’s internal regulations.
・ 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 periods ending July 2020and January 2021, 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 to respond to such opportunities
flexibly. On the other hand, in consideration of such factors as Samty Residential’s financial conditions and theprospect of its ability to refinance interest‐bearing liabilities, Samty Residential considers itself not to be in aposition in the said fiscal periods to allocate funds preferentially for reinforcing its financial base through suchmeasures as reducing interest‐bearing liabilities. While depreciation for the acquired assets is anticipated to be
773million yen for the fiscal period ending July 2020 and 770 million yen for the fiscal period ending January
2021, 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 described in the building condition survey reports will
be only 114 million yen (Estimate is 114 million yen for the fiscal period ending July 2020 and 114 million yen for
the fiscal period ending January 2021). Accordingly, Samty Residential expects to have residual free cash floweven after making certain reserves from the cash and deposits on hand equivalent to the depreciation amountat the end of each fiscal period as reserves for capital expenditures (CAPEX) to maintain the building functions,etc., as funds equivalent to the estimated amount of working capital, etc. and as reserves in preparation forinvestments that should contribute to increasing portfolio earning power as stated above.
・ Considering the above, Samty Residential believes as of today that it is appropriate to implement distribution inexcess of earnings for the fiscal periods ending July 2020 and January 2021 and anticipates 231 million yen and
208 million yen as total distribution in excess of earnings for each fiscal period. Such distribution in excess ofearnings is calculated by taking into account the level of the payout ratio (the ratio of total cash distribution,
including distribution in excess of earnings, to net income and depreciation combined), and the payout ratio will
be 74.7% and 75.4%, respectively. In addition, the total distribution in excess of earnings will be equivalent to30.0% and 27.0% of the depreciation expected to accrue in the respective fiscal periods.
・ Regarding the basic policy for cash management and the like for distribution in excess of earnings, please refer
to “Part 1 Fund information, 1. Fund status, 2. Investment policy” in the securities report filed on October 30,
2019.
・ 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 real estatemarket conditions, etc.