FY21/2 Q3 Corporate Presentation
January2021
January 13, 2021

Ichigo (2337)© Ichigo Inc. All rights reserved.

www.ichigo.gr.jp/en

We would like to express our deepest condolences
to all those across the world affected by the Covid
pandemic, along with our wishes for the earliest andfullest possible recovery.
Take care, be safe.

© Ichigo Inc. All rights reserved.

2

Make The World
More Sustainable© Ichigo Inc. All rights reserved.

© Ichigo Inc. All rights reserved.

© Ichigo Inc. All rights reserved.

Contents
FY21/2 Q3 Earnings‒ FY21/2 Q3 Summary‒ Covid Impacts‒ Covid Countermeasures‒ Operating Profit -65.8%, EPS -71.5% (YOY)‒ Segment Earnings Details‒ FY21/2 Full-Year Forecast Revision

Powerful Value-Add Business Model Underpins Growth‒ Business Model (1) Stock + Flow Earnings‒ Business Model (2) Embedded Forward Earnings‒ Business Model (3) Value-Add Drives Durable Value Growth‒ Business Model (4) Robust Cash Generation‒ Strong Financial Base
‒ UN ESG/SDGs Financing© Ichigo Inc. All rights reserved.

Sustainable Growth as a Sustainable Infrastructure
Company‒ Sustainable Real Estate: Selective on Acquisitions & Sales‒ Sustainable Real Estate Value-Add: Focus on Tenant
Needs‒ Sustainable Real Estate Value-Add: The OneFive Hotels‒ Sustainable Real Estate Value-Add: Anime & Real Estate‒ Asset Management: Growth Support for Ichigo REITs &Ichigo Green Solar Power‒ Clean Energy: Scaling Rapidly (In-Development Plants+41%)‒ Share Buybacks‒ Ichigo J.League Shareholder Program

Appendices
Ichigo’s Sustainability Commitment (ESG)
Financial & Real Estate Data
Ichigo 2030: Ichigo as a Sustainable Infrastructure Company
Ichigo 2030: New Initiatives

6

FY21/2 Q3 Earnings© Ichigo Inc. All rights reserved.

7

FY21/2 Q3 Summary
Durable Earnings Model
Robust Stock Earnings
Stock Earnings/Fixed Expenses

197%(JPY million)

Sustainable
Real EstateCashEarnings
JPY 16.6B

Asset Management

Clean Energy

316

14,271
11,495

10,192
7,015

Cash Earnings = Gross Profit + Fixed Asset Gainson Sales + Depreciation Expenses (Non-Cash)

FY20/2
Q3

FY21/2
Q3

FY20/2
Q3

FY21/2
Q3

1,599

1,343

FY20/2
Q3

FY21/2
Q3

2,479

3,136

FY20/2
Q3

FY21/2
Q3

UN ESG/SDGs Financing

Ichigo Owners Growth

Share Buyback

First Japanese Real Estate Company to
Borrow via ESG/SDGs Syndicated Loan
Program Based on UN Principles for
Positive Impact (Amount: JPY 10.6B)

Robust Capabilities & Execution
Amidst Covid

Flexible Deployment of Share
Buybacks Based on Ichigo 2030
Vision– Q3 Acquisitions: JPY 15.6B– Q3 Sales: JPY 33.9B– Additional Residential Asset
Acquisitions in Q4– Amount: Up to JPY 1.5B
– No. of Shares: Up to 5.5 million
shares (1.2%)– Buyback Period: Jan 14, 2021 –Apr 13, 2021

© Ichigo Inc. All rights reserved.

8

Covid Impacts
Asset Management− Decrease in Ichigo Hotel (3463) AM fees
− No impact on Ichigo Office (8975) & Ichigo Green (9282)

Sustainable Real Estate− Partial recovery in hotel rental income, but not to level to receive variable rent
− Minimal impact on retail rental income, but outlook uncertain on prolonged Covid− Residential asset sales & acquisitions continue to be active

Clean Energy− No impacts, growth on track
Covid Impacts
OfficeMinimal tenant departures – focus on forward outlook

Hotel

Some improvement, but nowhere close to full recovery

RetailRecovery varying by sector, with restaurants hit the hardest

Leasing

Residential Minimal impact – steady state, decrease in tenant moves
Sales & Acquisitions© Ichigo Inc. All rights reserved.

Slowdown in office, hotel, & retail; residential continues to be active
9

Covid Countermeasures
Infection Control & Response, Communication with Tenants, ThoroughInformation Gathering, & Extensive Safety Measures for Tenants
Covid Awareness & Prevention
Promotion Poster

Asset TypeAll Asset Types

OfficeHotel
RetailResidential© Ichigo Inc. All rights reserved.

Covid Infection Countermeasures
Provide hand sanitizers ubiquitously
Cover touch surfaces with antibacterial sheets
Post awareness & prevention promotion posters
Conduct online tenant surveys to identify needs
Experiment with disinfecting & cleaning robots &allocate more personnel to cleaning and disinfecting
Install antibacterial wallpaper and flooring
Install thermal cameras for temperature checks
Limit capacity in common areas
Display hotel information using monitors instead of
paper print-outs
Provide Covid countermeasure best-practice guidelines
to all tenants
Provide free Wi-Fi at all assets to facilitate remote work

10

Operating Profit -65.8%, EPS -71.5% (YOY)
Significant Covid Impact: Stock Earnings -19.5%, Flow Earnings -71.6% YOY(JPY million)

FY20/2
Q3

FY21/2Q3

YOY

RevisedFull-Year
Forecast

Operating Profit

25,0328,551-65.8%

9,500

Recurring Profit

22,665

6,535-71.2%

6,800

Net Income

15,1414,265-71.8%

5,000

JPY 31.09

JPY 8.86-71.5%

JPY 10.41

EPS© Ichigo Inc. All rights reserved.

11

Segment Earnings Details− Asset Management: Decrease in Ichigo Hotel (3463) AM fees
− Sustainable Real Estate
Stock Earnings: Significant decrease in hotel income; limited retail impact
Flow Earnings: Little activity in sales & acquisitions other than residential− Clean Energy: Steady growth; 8 new plants online since FY20/2 Q3(JPY million)

Gross Profit

Operating Profit
Segment

Asset Management (AM)FY20/2 Q3
(9M)

1,696

FY21/2 Q3
(9M)

944

RevisedFull-Year
Forecast

YOY-44.3%

1,300

FY20/2 Q3
(9M)

2,109

FY21/2 Q3
(9M)

1,445

Earnings Drivers(Parentheses show YOY change in
Gross Profit)

YOY-31.5%

Base AM Fees 1,235 (-295)
Acquisition/Disposition Fees 22 (-380)
Ichigo Office Cash Flow Performance Fees 79 (-27)
Ichigo Green Operator Fees 33 (-2)

Sustainable Real Estate (SRE)

22,232

6,069-72.7%

6,500

26,5589,748-63.3%

Rental Income (after Depreciation) 4,779 (-4,428)[Depreciation 2,235 (+1,252)]
Gains on Sales 4,968 (-12,008)
Gains on Overseas Sales – (-373)

Clean Energy (CE)

1,131

1,621

+43.3%

1,800

1,662

2,080

+25.1%

Power Generation Revenue (after Depreciation) 2,080 (+417)[Depreciation 1,056 (+240)]

-28

-82

–

-100

–

–

–

25,0328,551-65.8%

9,500

30,33013,273-56.2%

Adjustment (including offsets ofcross-segment transactions)

Total© Ichigo Inc. All rights reserved.

12

FY21/2 Full-Year Forecast Revision
Revised Forecast: OP JPY 9.5B, EPS JPY 10.4
− Sustainable Real Estate
Stock Earnings: Rental income above top-of-range of previous forecast
Flow Earnings: Gains on sales in middle-of-range of previous forecast, withresidential asset transaction market strong and other assets weak
− Asset Management & Clean Energy: No material revisions(JPY)

FY21/2
Revised Forecast

FY21/2Previous Forecast

FY20/2(Actual)Operating Profit

9.5B

7.4 – 12.9B

27.7B

Recurring Profit

6.8B

5.0 – 10.4B

24.3B

Net Income

5.0B

3.5 – 8.0B

8.2B

EPS

10.41

7.26 – 16.60

16.89

7

7

7

5.0%

3.5 – 7.7%

8.2%

Dividend
ROE© Ichigo Inc. All rights reserved.

13

Powerful Value-Add Business Model Underpins Growth© Ichigo Inc. All rights reserved.

14

Business Model (1) Stock + Flow Earnings
Stock Earnings (Primarily Rental Income, Power Generation Revenues, Depreciation (Non-Cash), & Base AM Fees)
Flow Earnings (Primarily Gains on Value-Add Real Estate Sales )37,016
Fixed Expenses (Fixed SG&A + Interest Expenses)

33,759Cash Earnings(JPY million)

28,641

27,953
18,567
15,273

21,563

14,13920,83313,015

5,831

16,566

8,986

13,396

5,070

4,591
18,485
14,502

12,57815,001
11,495

8,805
5,846

5,069

FY15/2

18,45014,939FY16/2

6,502

FY17/2

6,371

FY18/27,071

FY19/2

7,877
5,833

FY20/2

FY21/2 Q3

7,552

FY21/2 Forecast

Note: Cash Earnings = Gross Profit + Fixed Asset Gains on Sales + Depreciation Expenses (Non-Cash)© Ichigo Inc. All rights reserved.

15

Business Model (2) Embedded Forward Earnings
Full Economic Earnings From Value-Add Exceed Accounting Earnings
Value-Add Thus Generates Significant Unrealized Gains That Are “Earnings
Bank” for Future Periods(JPY billion)

50.9
36.8

56.2

45.4

28.1

FY16/2

FY17/2

FY18/2

FY19/2

FY20/2*

Appraisal Value-Based Unrealized Gains* FY20/2 Covid writedown assets’ unrealized gains of JPY 3B treated as zero value.
© Ichigo Inc. All rights reserved.

16

Business Model (3) Value-Add Drives Durable Value Growth
Gains on Sales Consistently Exceed
Appraisal Value-Based Unrealized Gains
Appraisal Value-Based Unrealized Gains
Gains on Sales (Gross Profit)

2.8X
2.5X

4.4X
1.6X

JPY 17.1B
JPY 15.0B

1.7X

JPY 12.0B
JPY 10.5B

JPY 6.4B

JPY 5.9B

JPY 6.1B
JPY 4.9B

JPY 2.7B

FY17/2© Ichigo Inc. All rights reserved.

FY18/2

JPY 2.8B

FY19/2

FY20/2

FY21/2 Q3
17

Business Model (4) Robust Cash Generation
Economic Operating Cash Flow Exceeds Net Income(JPY billion)

3.6X

Net Income
Economic Operating Cash Flow

1.7X
1.4X

1.3X

1.2X
29.5

25.5
21.5
17.1
12.9

14.9

14.0

16.7

15.4
8.2

FY16/2
FY17/2
FY18/2
FY19/2
Note: Economic Operating Cash Flow = Cash Flows from Operations excluding net change in Real Estate and Power Plants for Sale
© Ichigo Inc. All rights reserved.

FY20/218

Strong Financial Base
Average Interest Rate & Loan Term

Weighted Average Loan Period
Weighted Average Remaining Loan Maturity
Weighted Average Interest Rate

(Interest Rate)(Loan Term, Years)

2.5%

12
10.8 years
10.2 years
9.0 years

2.0%
8.3 years

1.5%

8.7 years

10.3 years

10.0 years

10.1 years

9.6 years
9
7.6 years

7.6 years

7.4 years

8.3 years

7.8 years

1.71%

6
1.41%
1.24%

1.04%

1.0%

0.97%

0.91%

0.90%

FY19/2

FY20/2

FY21/2 Q3

0.5%

3

0
FY15/2

FY16/2

FY17/2

FY18/2

Term Structure of Loans
Short-Term

7% (JPY 12.4B)

8% (JPY 4.9B)

10% (JPY 10.3B)

6% (JPY 6.1B)

5% (JPY 5.6B)

8% (JPY 11.3B)

9% (JPY 15.6B)

92%(JPY 53.4B)

90%(JPY 94.4B)

94%(JPY 92.2B)

95%(JPY 112.8B)

92%(JPY 132.1B)

91%(JPY 157.5B)

93%(JPY 166.0B)

FY15/2

FY16/2

FY17/2

FY18/2

FY19/2

FY20/2

FY21/2 Q3Long-Term© Ichigo Inc. All rights reserved.

19

UN ESG/SDGs Financing
First Japanese Real Estate Company to Borrow via ESG/SDGs SyndicatedLoan Program Based on UN Principles for Positive Impact (Amount: JPY
10.6B)− Unrestricted funds available for broad use across Ichigo’s businesses− Ichigo recognized for:
 Contribution to clean energy production andCO2 reduction via solar power plants nationwide
 Extending useful life of real estate Revitalizing local communities
 Robust corporate governanceStrong Financial Position
Cash Available to Acquire Assets in Any Market Turndown
ESG/SDGs Syndicated Loan Program Based on UN Principles for Positive Impact−−

SMBC loan program that finances sustainable business management
Analyzes & evaluates the environmental, social, and economic impacts of a company’s business activities© Ichigo Inc. All rights reserved.

20

Sustainable Growth as a Sustainable Infrastructure Company© Ichigo Inc. All rights reserved.

21

Sustainable Real Estate

Selective on Acquisitions and Sales
FY21/2 Acquisitions: JPY 28.8B− Ichigo Owners acquired 18 assets (JPY 15.6B, 54% of total)− Ichigo Owners continuing to execute on acquisitions (current inventory: JPY 17.7B)

FY21/2 Sales: JPY 37.9B− Ichigo Owners sold 31 assets (JPY 33.9B, 89% of total)(Including JPY 17.3B residential asset sale to global institutional investor in Q3)

FY21/2 Net Sales: JPY 9.1B

(JPY million)

Acquisitions

Sales

No. ofBook Value (A)AssetsNo. ofAssetsSale Price (B)Difference（A）-（B）

Office

1

1,664

1

701

+963

Hotel

3

8,718

–

–

+8,718Retail

1

863

2

5,252

-4,389Residential

20

16,68738

31,810-15,123

Other

5

837

2

141

+696

Total

30

28,77043

37,904-9,134

Note: Book value of asset sales is JPY 32.2 billion© Ichigo Inc. All rights reserved.

22

Sustainable Real Estate

SRE Value-Add: Focus on Tenant Needs (1)Ichigo Layout Office: Driving Higher Tenant Satisfaction & Asset Value− Reduces tenant costs & accelerates tenant move-ins− Strong design aesthetics− Flexible layout to accommodate changes in tenant staff numbers & working styles
CTN Building (Chiyoda-ku, Tokyo)
Rent Increase© Ichigo Inc. All rights reserved.

2.1X

23

Sustainable Real Estate

SRE Value-Add: Focus on Tenant Needs (2)New Restaurant Tenant at the Plaza Hotel Premier (Fukuoka)− Leased first floor to well-known restaurant despite difficult Covid environment− Build relationships of trust with tenants & customers without relying on property
management companies and brokers− Ichigo engineers supported tenant’s construction & regulation compliance− Ichigo reworked hotel floor plan to deliver restaurant’s required storage space− Lease has both step-up rent & percentage rent to decrease up-front costs &economic risk for tenant
Re-Tenanting Drives Rental Growth© Ichigo Inc. All rights reserved.

Rent Increase 2.2X

24

Sustainable Real Estate

SRE Value-Add: The OneFive Hotels
Redesigned, refurbished, & rebranded 35-year old hotel in central Hakata(Fukuoka) deploying Ichigo’s value-add capabilities and know-how−

The OneFive is a new Ichigo hotel brand with hotels focused on serving local
communities & providing high-level guest services− The OneFive Villa Fukuoka opened on February 1, 2020
Occupancy 96%, RevPAR JPY 15,800 (November 2020 actual operating results)− Deploying Propera, Ichigo’s AI-based hotel revenue management system− The OneFive Terrace Fukuoka opened on December 15, 2020
The OneFive Villa Fukuoka© Ichigo Inc. All rights reserved.

The OneFive Terrace Fukuoka

25

Sustainable Real Estate

SRE Value-Add: Anime & Real Estate
Driving Synergies Between AKIBA CULTURES ZONE Retail Asset & Ichigo
anime series VLADLOVE− Sales of VLADLOVE premium goods at Ichigo Animation’s official shop, CulZone− Live performance of VLADLOVE Ambassadors at AKIBA CULTURES Theater− Displaying panel autographed by Executive Director Oshii & Director Nishimura− Event collaborations with tenants

Real Estate x Anime Content
Synergies

AKIBA CULTURES ZONE
© Ichigo Inc. All rights reserved.

VLADLOVE Official Shop
26

Asset Management

Growth Support for Ichigo REITs & Ichigo Green Solar Power
OfficeHotel

Ichigo Office(8975)

Green Infrastructure

Ichigo Hotel(3463)

Ichigo Green(9282)

IPO

IPO

IPO

October 12, 2005

November 30, 2015

December 1, 2016

Portfolio

Portfolio

Portfolio

86 Assets JPY 206.1B

23 Hotels JPY 51.9B

15 Solar Power Plants JPY 11.4B

Dividend Yield (as of 2021/1/8)

Dividend Yield (as of 2021/1/8)

Dividend Yield (as of 2021/1/8)

5.5%

2.5%

6.0%

・ Entered FTSE Global REIT Index, a key
benchmark for global investors

・ Geographically diversified portfolio
focused on lodging-focused hotels

・ Ichigo Office & Ichigo Hotel only J-REITs
to implement no fixed fee, performancefee-only structure

・ Ichigo Office & Ichigo Hotel only J-REITs
to implement no fixed fee, performancefee-only structure

・ Solar power producer focused on driving
shareholder value via income stability andearnings growth and contributing toJapan’s self-sufficiency in clean energy

・ Driving earnings & value growth via valueadd, strategic asset acquisitions & sales,& share buybacks

・ Driving earnings & value growth via valueadd, strategic asset acquisitions & sales, &share buybacks

Ichigo Growth Support

Ichigo Growth Support

Ichigo Growth Support

Providing comprehensive coverage to Ichigo
Office assets via Ichigo’s disaster response
systemProvided subordinated debt (JPY 500M) to
support IHR’s financial base amidst Covid

Operating all plants and providing ongoing
performance guarantee© Ichigo Inc. All rights reserved.

・ Portfolio of robust assets that havesuffered no injuries or damages fromnatural disasters

27

Clean Energy

Scaling Rapidly (In-Development Plants +41%)
3 New Plants (Total 5.6MW) Online in Q3
7 New Plants (Total 21.1MW) Forecast for FY21/2 (full-year)
173.9MW(Solar 13.7MW, Wind 7.3MW)
Power Generation
136.3MW(+21%)

Ichigo Total 169.5MW
Operating Plants: 120.5MW
In-Development Plants: 48.9MW (+41%)
Ichigo Green (9282)
Operating Plants: 29.4MW

101.8MW(+88%)

157.4MW(+16%)(+10%)

Wind 7.3(Wind 7.3)

FY21/2
JPY 32.2
JPY 36.3B

FY22/2
JPY 30.7
JPY 38.9B

23.9

198.9MW(+14%)

48.9(Wind 18.3)

113.1MW(+11%)

54.2MW

Avg FIT
Ichigo Investment

25.8MW

29.4MW

FY17/2
JPY 37.3
JPY 8.4B

FY18/2
JPY 36.4
JPY 21.1B© Ichigo Inc. All rights reserved.

FY19/2
JPY 35.3
JPY 23.6B

FY20/2
JPY 34.3
JPY 30.0B

FY23/2 ~JPY 30.9
JPY 48.7B
28

Share Buybacks
Ichigo 2030: Flexible Deployment of Share Buybacks
Purpose: Grow Shareholder Value
January 2021 Buyback
Share Type
Common shares
Buyback Method
In-market purchases via securities firm
AmountJPY 1.5 billion (maximum)
Number of Shares
5,500,000 (maximum)(1.15% of shares outstanding, net of treasury shares)
Buyback Period
January 14, 2021 – April 13, 2021
Number of Shares
Purchased(% of Shares Outstanding)

Average PurchasePrice

AmountFY21/2October 15 – November 20, 2020

4,712,500(0.9%)

JPY 318

JPY 1.5 billion

FY20/2

7,081,200(1.4%)

JPY 424

JPY 3 billion

FY19/2

7,869,700(1.6%)

JPY 381

JPY 3 billion

FY18/28,436,500(1.7%)

JPY 355

JPY 3 billion© Ichigo Inc. All rights reserved.

29

Ichigo J.League Shareholder Program
Represents Two Firsts for a Shareholder Program in Japan− First Japanese company to include not just its own shareholders, but also theshareholders of the REITs and listed solar power producer that it manages, in its
shareholder program (67,000 shareholders in total)− First company to offer shareholders free tickets to every J.League game at every
J.League club (currently paused due to Covid)

Ichigo is deepening its partnership with the J.League and working tofurther Ichigo’s mission of promoting local community development.
Events & Presents− Ichigo Kids J.League Events
 Escort players onto field High-fives with players
 Other programs− J.League Merchandise Autographed jerseys from all
J.League clubs
 Ichigo original J.League towels− J.League Online Events
Ichigo J.League Shareholder Program Website Landing Page
© Ichigo Inc. All rights reserved.

30

Appendix: Ichigo’s Sustainability Commitment (ESG)© Ichigo Inc. All rights reserved.

31

Ichigo Sustainability Policy
Harmony with the Environment
Ichigo actively monitors and minimizes the environmental impact of its business operations.

Energy Conservation, CO2 Reduction, and Recycling
Ichigo seeks to contribute to a low-carbon, low-waste society by reducing energy
consumption, extending the useful life of assets, actively recycling, reducing waste
production and water consumption, and implementing green procurement measures.

Regulatory and Environmental Compliance
Ichigo complies with all environmental laws and regulations and Ichigo’s own independently
established environmental rules. Ichigo also carefully monitors and complies with all applicablechanges in laws and regulations.

Training and AwarenessIchigo promotes understanding of its Sustainability Policy and works to increase sustainability
awareness among all Ichigo employees.

Sustainability Performance Communication and Disclosure
Ichigo communicates its Sustainability Policy and Ichigo’s sustainability initiatives to society atlarge. Ichigo also obtains certifications for its sustainability activities on an ongoing basis.

© Ichigo Inc. All rights reserved.

32

Ichigo ESG – Environmental
Sustainable Real Estate

Contributing to a Low-Carbon World
Annual Power Generation 147,296,453 kWh

Preserve & Improve Real Estate to End Wasteful
Demolition

Equivalent to annual
energy consumption of
49,100 households‒ Lengthen useful life of real estate‒ Shrink environmental footprint by reducing
wasteful demolition & consumption of raw
materials, energy, & human talent in construction
LowestImpactWasteful
Demolition
HighestEfficiency
Productive Use of Idle Land for Clean Energy
Ichigo will not build power plants that require theclearing of wooded land or the altering of thelandscape in a way that increases the risk of floods,
landslides, or other water-related disasters, or thatface opposition of local residents.

The Federation of Electric Power Companies of Japan
Annual energy consumption per household 3,000kWh

Annual CO2 Reduction 97,215,656 kg

Environmental
Sustainability& Prosperity

Equivalent to annual
CO2 emission of
42,300 cars
Ministry of Environment
Annual CO2 emission per car c. 2,300kg(FY20/2 Actuals – Includes Ichigo Green)

Sustainable Real Estate – Environmental Certifications
Ichigo Group-Wide
CASBEE: 12 Assets

Ichigo Office (8975)
Green Star (Highest Ranking)4 years in a row

BELS: 2 Assets
DBJ Green Building: 2 Assets
Ichigo Kakyoin Building

Ichigo Hakata
Ekimae Square© Ichigo Inc. All rights reserved.

Ichigo Hakata Meiji Dori Building

33

Ichigo ESG – Social
Supporting Local Communities

Working with Tenants− Conduct tenant surveys to understand needs toimplement effective value-add− Became sole investor for Oshii Mamoru’s new
anime VLADLOVE to synergize with Ichigo’s
retail asset AKIBA CULTURES ZONE andpromote Japan’s anime culture− Support tenant sales and sales channel
expansion− Operate self-storage and laundromats to
support housekeeping− Ichigo’s Boutique Hotel THE KNOT
Creating a place for visitors, communities, andthe old and the new to come together− Miyako City, Nanbu Wholesale Market
Foster community exchanges− J.League Top Partner
Promote community development, revitalize local
economies, and renovate stadiums− TSUBASA+ AR Smartphone Game
Promote Japanese culture revitalize communities− Smart Agriculture

Make The World More Sustainable
HR & Internal Start-Ups− Ichigo University for employees’taught by specialists in their fields− Ichigo Sustainable Lab
Promotion of R&D & internal start-ups− Support for Employees
100% return rate for employees whotake maternity/paternity leave.

− Women in Leadership
Women hold 24% of management
positions© Ichigo Inc. All rights reserved.

Sports & Arts

Disaster Response− Support National & World-Class
Athletes− Support University of Miyazaki Facultyof Medicine’s Program for Children− Support community-based soccer clubs− Support artists withdisabilities− Typhoon disaster preventative
measures− Quick grasp of disaster severity− Access to disaster information− Technical support to prevent secondary
damage & maintain delivery ofessential goods− Neighborhood watch− Street cleaning and snow shoveling

Weightlifting Athlete
Hiromi Miyake

34

Ichigo ESG – Governance
Majority Independent Director Board
Underpins Strong Governance

Early Adopter of Global Best PracticeCorporate Governance Structure− Adopted Independent Director-led, committeebased governance system in 2006 to incorporate
global best practice− Exceeded legal requirements by establishingCompliance Committee in addition to Nominating,
Audit, and Compensation Committees− Nominating Committee: 5 members(3 Independent Directors)− Audit Committee: 3 members(All Independent Directors)− Compensation Committee: 5 members(3 Independent Directors)− Compliance Committee: 4 members(2 Independent Directors)− Of 9 members of Ichigo’s Board of Directors, 5
are Independent Directors− Includes former CEOs of TSE 1 Section
companies− Since FY20/2 (current)
Masatoshi Matsuzaki (former CEO of Konica
Minolta)Nobuhide Nakaido (former CEO of SCSK)− Stepped down after FY18/2
Takashi Kawamura (former CEO of Hitachi;
stepped down from Ichigo’s board in May 2017upon appointment as Chairman of TEPCO)
Kosuke Nishimoto (former CEO of Meitec;
stepped down from Ichigo’s board in May 2019
upon appointment as EVP of Misumi Group)

Strong Governance Supports Environmental & Social Contributions
Board of Directors Evaluation– Assessment of the Board by each Director, followed by collective analysis and review
 Board Composition
Evaluation Results
The Board confirmed that its deliberation
 Board Operationand decision-making processes are Board Effectivenesseffective & also received third-party Board Support Resources
confirmation with respect to this result.
 Engagement with Shareholders and Stakeholders– Third-party confirmation of the effectiveness of Ichigo’s Board Evaluation by JMA Research Institute© Ichigo Inc. All rights reserved.

35

Appendix: Financial & Real Estate Data

© Ichigo Inc. All rights reserved.

36

Significant Unrealized Gains on Balance Sheet
JPY 54.4B (Appraisal Value Basis), +0.4% vs. FY21/2 H1-end
Real Estate Directly Held by Ichigo(JPY million)

LocationBook Value as ofAppraisal NOI
November 30, 2020 (A)(B)

Cap Rate(B)/(A)

Appraisal Value(C)

Unrealized Gains(C) - (A)Tokyo

95,540

5,436

5.7%

128,015+32,474

Outside Tokyo108,633

7,200

6.6%

130,618+21,985

Total

204,173

12,636

6.2%

258,633+54,459

Notes: Excludes Ichigo Owners, Centro, and self-storage assets (book value JPY 38.73B)
FY20/2 Covid writedown assets’ unrealized gains recorded as zero

© Ichigo Inc. All rights reserved.

37

Risk-Based Balance Sheet
Mark-to-Market Consolidated Balance Sheet: JPY 395.3B(Book Value JPY 338.5B + Unrealized Gains JPY 56.7B)
Cash & Cash Equivalents

JPY 42.6B

Non-Recourse Loans &Related Liabilities

JPY 47B
Non-Recourse Loans &Related Assets

Net Consolidated Risk-Based Balance Sheet:
JPY 305.7B(Book Value JPY 248.9B + Unrealized Gains JPY 56.7B)

JPY 63.4B

Non-Recourse Loan-Related ICH Equity

Operational Loan Investments
JPY 1.3B

Operational Loan Investments
JPY 1.3B

JPY 16.4B

Operational Securities Investments
JPY 0.6B

Corporate Loans & Bonds

JPY 178.4B
Real Estate for Sale

JPY 54.7B

Debt
JPY
239B

Operational Securities Investments
JPY 0.6B

Corporate Loans & Bonds
Real Estate for Sale

JPY 54.7B

Security Deposits Received
JPY 5.1B

Other JPY 8.3B

Other JPY 8.3B
Fixed Assets

JPY 161.2B

JPY 161.2B

Securities Investments
JPY 4.9B

Unrealized Gains
JPY 56.7B

Mark-toMarket
Shareholder
Equity Ratio

35.1%

Other JPY 9.6B

Post-Tax Unrealized
Gains JPY 39.3B
Tax JPY 17.3B*

Debt
JPY
149.3B
Security Deposits Received
JPY 5.1B

Fixed Assets

Shareholder
EquityJPY 99.5B

JPY 135.8B*30.62% statutory tax rate

Securities Investments
JPY 4.9B

Shareholder
EquityJPY 99.5B

Other JPY 9.6B

Unrealized Gains
JPY 56.7B

Net Risk-Based
Shareholder
Equity Ratio

45.5%

Post-Tax Unrealized
Gains JPY 39.3B
Tax JPY 17.3B*

Note: Risk-Based Balance Sheet excludes client and non-recourse assets & liabilities and nets out Cash & Cash Equivalents.
© Ichigo Inc. All rights reserved.

38

Cash Flow Maximization
Reclassification of Sustainable Real Estate Assets to Fixed Assets toIncrease Cash Flow
Real Estate for Sale & Fixed Assets
Fixed Assets (SRE)
Real Estate for Sale (SRE)

7.2%

Fixed Asset Ratio
84.4%
30.1%

15.2%

30.9

12.8%

140.2

169.4

164.9

162.3
167.2

(JPY billion)

Maximal use ofdepreciation allowances
lowers accounting EPS &ROE, but creates value by
being cash-generative tofund growth investments

60.4
13.1
FY 16/2

24.3

29.1

FY 17/2

FY 18/2

FY 19/2

FY 20/2

Note: Excludes Ichigo Owners, Centro, and self-storage assets© Ichigo Inc. All rights reserved.

39

Robust Cash Flow Generation & Strong Earnings BaseKey Ichigo Strength: Robust Cash Generation to Fund Growth− Maximal use of non-cash depreciation allowances− Majority of cash earnings are Stock Earnings− Stock Earnings/Fixed Expenses Ratio – even amidst Covid – isconsistently c. 200%
(JPY million)
FY15/2

FY16/2

FY17/2

FY18/2

FY19/2

FY20/2

FY21/2 Q3(9M)

FY21/2
Forecast

Stock Earnings (A)8,805

12,57814,502

14,93918,48518,45011,49515,001(Depreciation)

503

731

716

967

1,632

2,507

3,292

4,494

Flow Earnings

4,591

8,986

14,13913,015

15,273

18,567

5,070

5,831

Cash Earnings

13,396

21,56328,641

27,95333,75937,016

16,566

20,833Fixed Expenses (B)

5,069

5,846

6,502

6,371

7,071

7,877

5,833

7,552

Stock Earnings/
Fixed Expenses (A/B)

174%

215%

223%

234%

261%

234%

197%

199%

Note: Cash Earnings = Gross Profit + Fixed Asset Gains on Sales + Depreciation Expenses (Non-Cash)© Ichigo Inc. All rights reserved.

40

Post-GFC Shift in Earnings Base & Financial Position
Stock Earnings/
Fixed Expenses
Coverage Ratio

FY09/2GFC

FY14/2Start of Shift Up MTP

FY20/2

vs. GFC

75%

140%

234%

3.1X

10.3 years
Loan Maturity(Weighted avg.,
corporate + non-recourse loans)

3.7X

5.6 years
2.8 years

93%% of <3 Year Loans(corporate + non-recourse loans)Interest Cost
(Weighted avg., corporate loans)© Ichigo Inc. All rights reserved.

>3 years
7%28%<3 years
28%

14%<3 years
14%<3 years
93%>3 years72%>3 years
86%

2.22%

1.96%

0.91%

-79%

-59%

41

Business Segments

Asset Management

Asset Management (AM) generates fee income via management of
Ichigo Office (8975), Ichigo Hotel (3463), and Ichigo Green (9282),
and private real estate funds.

Sustainable
Real Estate

Sustainable Real Estate (SRE) preserves and improves real estate.
Ichigo receives rental income during the period in which it carries out
its value-add, along with earning gains on sales that reflect the realestate’s higher value after the value-add is complete.

Clean Energy

Clean Energy (CE) is utility-scale solar and wind power productionthat produces clean energy and brings productive use to idle land.

Note: The Sustainable Real Estate segment was formerly called Value-Add. In keeping with its Ichigo 2030 vision, Ichigo changed thesegment name to Sustainable Real Estate in 2019 in order to put full focus on Ichigo’s commitment to preserving and improving realestate as a sustainable infrastructure company.
© Ichigo Inc. All rights reserved.

42

Consolidated Balance Sheet: Segment Breakdown(JPY million)
Cash andCash
Equivalents

Operational
Loan
Investments

Operational
Securities
Investments

Real Estatefor SalePower
Plants for
Sale

–

–

–

–

–

Sustainable Real Estate (SRE)

15,3601,324

608

54,720Clean Energy (CE)

3,509

–

–

Company-Wide Assets

31,188–

Total

50,0591,324

Segment

Asset Management (AM)© Ichigo Inc. All rights reserved.

Fixed
AssetsIntangible
AssetsSecurities
Investments

Other
Assets

–

718

98

758

1,575

–

186,924

3,163

3,529

2,814

268,446––

29,097

191

–

1,224

34,023

–

–

–

114

124

1,323

1,797

34,548608

54,720–216,135

4,199

4,950

6,594

338,593

Total Assets

43Consolidated P&L: Segment Breakdown(JPY million)

Gross Profit
Segment

1,696

944

-44.3%

1,300

1,343

-16.0%

–

–

–

–

509

101

-80.0%––––

26,5589,748-63.3%

22,232

6,069-72.7%

6,500

Rental Income

9,208

4,779

-48.1%––––

Asset Sales

16,985

4,977-70.7%

–

–

–

–

364

-8

–

–

–

–

–

1,662

2,080

+25.1%

1,131

1,621

+43.3%

1,800

–

–

–

-28

-82

–

-100

30,33013,273-56.2%

25,0328,551-65.8%

9,500

Sustainable Real Estate (SRE)

Other Flow Earnings
Clean Energy (CE)
Adjustment (including offsets ofcross-segment transactions)
Total© Ichigo Inc. All rights reserved.

1,445

1,599

YOY
Change-31.5%

Acquisition/Disposition Fees

2,109

YOY
ChangeFY21/2 Q3Base AM Fees

FY21/2 Q3Revised
FY21/2Full-Year
Forecast

FY20/2 Q3Asset Management (AM)FY20/2 Q3Operating Profit

44

Asset Management AUM Detail

Ichigo Office(8975)

Ichigo Hotel(3463)

Ichigo Green(9282)
Private Equity
Real Estate Funds(excluding
consolidated funds)
Total(excluding
consolidated funds)

FY16/2(12M)

FY17/2(12M)

FY18/2(12M)

FY19/2(12M)

FY20/2(12M)

FY21/2 Q3(9M)

AUM (Fiscal Year End)JPY 165.1B

JPY 194.5B

JPY 196.9B

JPY 203.0B

JPY 203.2B

JPY 202.3B

Base AM Fee Gross Profit (Actual)

JPY 1,016M

JPY 1,291M

JPY 1,373M

JPY 1,426M

JPY 1,436M

JPY 1,112M

AUM (Fiscal Year End)JPY 20.4B

JPY 47.6B

JPY 50.9B

JPY 50.7B

JPY 50.8B

JPY 51.9B

JPY 30M

JPY 287M

JPY 450M

JPY461M

JPY 381M

JPY 25M

AUM (Fiscal Year End)–JPY 10.0B

JPY 11.4B

JPY 11.4B

JPY 11.4B

JPY 11.4B

Base AM Fee Gross Profit (Actual)–

JPY 11M

JPY 77M

JPY 85M

JPY 82M

JPY 64M

JPY 15.4B

JPY 6.4B

JPY 12.3B

JPY 20.6B

JPY 36.8B

JPY 36.8B

JPY 60M

JPY 27M

JPY 12M

JPY 41M

JPY 116M

JPY 102M

AUM (Fiscal Year End)JPY 200.9B

JPY 258.6B

JPY 271.7B

JPY 285.8B

JPY 302.4B

JPY 302.5B

Base AM Fee Gross Profit (Actual)

JPY 1,106M

JPY 1,617M

JPY 1,914M

JPY 2,014M

JPY 2,016M

JPY 1,305M

Base AM Fee Gross Profit (Actual)

AUM (Fiscal Year End)
Base AM Fee Gross Profit (Actual)

Ichigo Green Base AM Fee Gross Profit (Actual) includes operator fees.

© Ichigo Inc. All rights reserved.

45

Powerful Sustainable Real Estate Business Model
Significant Synergies Between Ichigo’s Sustainable Real Estate & AssetManagement Businesses
Sustainable Real Estate Business Model
Green
Infrastructure

Solar Plants
Buy

Ichigo Green(9282)
OfficeIchigo Office(8975)
Hotel

Ichigo Hotel(3463)© Ichigo Inc. All rights reserved.

Sell

Real
不動産
EstateSustainable
Value-Add
Preserve &ImproveReal
EstateThirdParty
Investors

Sell

Buy
46

Sustainable Real Estate Social SignificanceSustainable Real Estate Serving a Sustainable Society
End Wasteful Demolition and Embrace Sustainable Value-Add‒ Preserve and improve highly functional real estate‒ Lengthen useful life and improve quality of assets via Sustainable Value-Add

Wasteful
Demolition

Sustainable
Value-Add

Productive &Sustainable
Use of Key
SocialInfrastructure© Ichigo Inc. All rights reserved.

Preserve & Improve Real Estate・ Higher-Quality Tenant Services
・ Higher Functionality (Security, HVAC, etc.)
・ Upgrade Exteriors/Interiors
・ Seismic Reinforcements

HighestEfficiency
LowestImpact47

Ichigo Sustainable Real Estate Earnings Model Example
5.5% NOI Yield, JPY 2B Purchase, LTV 75%, 1.5% Interest Rate, JPY 50M
Capex, 15% Increase in NOI, 3-Year Value-Add Period
Value-Add Measures: Improved exterior, interior, & tenant services; seismic
strengthening; increased energy efficiency; new tenant leasing; etc.
NOI at Acquisition(JPY 110M NOI/year) － (JPY 22.5M interest/year) ＝ JPY 87.5M NOI/yearNOI÷ Initial Investment ＝17.5% NOI return during investment period
.

Debt
Asset

JPY1.5B

JPY
2.0B

NOI after Value-Add(JPY 126.5M NOI/year) － (JPY 22.5M interest/year) ＝ JPY 104M NOI/year
NOI ÷ Total Investment (JPY 500M + JPY 50M) ＝18.9% NOI return during
investment period.

EquityJPY 0.5B

Capital Gain
The 15% increase in NOI at an equivalent cap rate increases the exit price by
15%: JPY 2B * 115% = JPY 2.3B
JPY 2.3B – (JPY 2B + JPY 50M) = JPY 250M capital gain.

Value-Add (Capex JPY 50M )© Ichigo Inc. All rights reserved.

OutcomeJPY 550M investment generates JPY 512M over 3 years → 31.1% p.a.

48

Sustainable Real Estate: Gross Profit Margin (GPM)
Ichigo Sustainable Value-Add Supports Ongoing High GPM

FY17/2

FY18/2

FY19/2

FY20/2

FY21/2 Q3

GPM(vs. Revenue)

13.6%

33.7%

25.5%

28.3%

13.2%

GPM
(vs. Book Value)

15.8%

50.9%

34.3%

39.5%

15.2%

Revenue(JPY M)

77,50235,73358,69360,60137,904Gross Profit(JPY M)

10,562

12,05014,986

17,1584,995© Ichigo Inc. All rights reserved.

49

Ichigo-Owned Real Estate Portfolio
By Location

By Asset TypeGround Lease
Other
1%
5%
Logistics
2%

Osaka 3%

Sendai 2%

Nagoya 3%

Retail28%

Office26%

Hokkaido
7.1

Other
7%

Hokkaido
3%
Residence
12%(JPY billion)

Tokyo
Metro*
11%

Tokyo
50%
Tokyo
118.7

Fukuoka
21%

Hotel
26%

Sendai
5.9*Ex-Tokyo

By Asset Size
>JPY
10B
12%

<JPY 1B19%

JPY 5B-10B
23%
JPY 1B-5B
46%

Nagoya7.3

Fukuoka
49.7

Osaka
6.9

Tokyo
Metro
(ExTokyo)
27.2

Other
15.5

Total Ichigo-Owned Assets: JPY 238.6B
Including Ichigo-Managed AUM: JPY 541.2B* Acquisition price basis
Ichigo-Managed AUM includes JPY 11.4B Ichigo Green assets.
Total Ichigo-Owned Assets Book Value: JPY 240.8B© Ichigo Inc. All rights reserved.

50

Sustainable Real Estate Asset Breakdown (1)170 Assets, JPY 238.6 B, Forecast NOI JPY 12.6B (6.2% Yield)
No.

Asset TypeClassification

Location

AcquisitionPrice

Acquisition
Date

Building
Age

Expected

Ichigo Equity
Investment

1

NOI/Year

Forecast
EquityMultiple2

Forecast
IRR

3

1

Wholesale Market

Fixed Asset

Matsudo, Chiba

JPY 2B-3B

2005/0648 years–

JPY 1,900M

–

–

2

RetailFixed Asset

Minato-ku, Tokyo

JPY 2B-3B

2005/1051 years

JPY 136M

JPY 1,033M

–

–

3

RetailFixed Asset

Minato-ku, Tokyo>JPY 3B

2006/0335 years

JPY 165M

JPY 1,356M

–

–

4

RetailFixed Asset

Yokohama

JPY 1B-2B

2006/0915 years

JPY 60M

JPY 1,157M

–

–

5

OfficeFixed Asset

Sendai>JPY 3B

2006/10

12 years

JPY 240M

JPY 1,042M

–

–

6

OfficeFixed Asset

Fukuoka>JPY 3B

2006/12

12 years

JPY 350M

JPY 1,339M

–

–

10

RetailFixed Asset

Chiyoda-ku, Tokyo<JPY 1B

2007/06

41 years

JPY 85M

JPY 240M––

11

RetailFixed Asset

Chiyoda-ku, Tokyo<JPY 1B

2007/0639 years

JPY 125M

JPY 233M––

14

Ground Lease

Fixed Asset

Atsugi, Kanagawa

JPY 1B-2B

2011/06–

JPY 172M

JPY 147M––

15

RetailFixed Asset

Hiratsuka, Kanagawa<JPY 1B

2012/0225 years

JPY 77M

JPY 172M––

16

RetailFixed Asset

Yokohama<JPY 1B

2012/10

7 years

JPY 34M

JPY 171M––

17

RetailFixed AssetToshima-ku, Tokyo>JPY 3B

2013/03

9 years

JPY 244M

JPY 340M––

18

RetailFixed Asset

Shibuya-ku, Tokyo<JPY 1B

2013/05

34 years

JPY 57M

JPY 154M––

19

RetailFixed Asset

Chofu, Tokyo

JPY 1B-2B

2013/06

35 years

JPY 135M

JPY 310M––

21

Residential

Fixed Asset

Minato-ku, Tokyo<JPY 1B

2013/06

5 years

JPY 47M

JPY 203M––

Note: 6.2% yield excludes Ichigo Owners, Centro, and self-storage assets.
1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

51

Sustainable Real Estate Asset Breakdown (2)No.

Asset TypeClassification

Location

AcquisitionPrice

Acquisition
Date

Building
Age

Expected
1

NOI/Year

Ichigo Equity
Investment

Forecast
EquityMultiple2

Forecast
IRR

3

27

RetailFixed Asset

Tokorozawa, Saitama

JPY 1B-2B

2013/11

13 years

JPY 76M

JPY 92M––

29

Ground Lease

Fixed Asset

Fujisawa, Kanagawa

JPY 1B-2B

2014/03–

JPY 114M

JPY 273M––

30

RetailFixed Asset

Shibuya-ku, Tokyo<JPY 1B

2014/0336 years

JPY 51M

JPY 108M––

32

RetailFixed Asset

Fukuoka

JPY 1B-2B

2014/04

14 years

JPY 58M

JPY 279M––

35

RetailFixed Asset

Minato-ku, Tokyo

JPY 2B-3B

2014/05

11 years

JPY 144M

JPY 434M––

37

RetailFixed Asset

Minato-ku, Tokyo<JPY 1B

2014/0748 years

JPY 47M

JPY 77M––

39

RetailFixed Asset

Fukuoka<JPY 1B

2014/0716 years

JPY 52M

JPY 213M––

40

RetailFixed Asset

Fukuoka<JPY 1B

2014/0935 years

JPY 49M

JPY 252M

–

–

41

Hotel

Fixed Asset

Utsunomiya, Tochigi

JPY 1B-2B

2014/09

33 years

JPY 143M

JPY 400M––

42

RetailFixed Asset

Fukuoka<JPY 1B

2014/0920 years

JPY 60M

JPY 177M––

43

RetailFixed AssetOsaka

JPY 1B-2B

2014/0918 years

JPY 117M

JPY 301M––

45

RetailFixed Asset

Fukuoka

JPY 1B-2B

2014/1117 years

JPY 92M

JPY 135M––

57

Residential

Fixed Asset

Minato-ku, Tokyo

JPY 1B-2B

2014/1216 years

JPY 56M

JPY 186M––

62

RetailFixed Asset

Fukuoka<JPY 1B

2014/1216 years

JPY 41M

JPY 212M––

63

RetailFixed Asset

Meguro-ku, Tokyo

JPY 1B-2B

2014/12

14 years

JPY 85M

JPY 129M––

1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

52

Sustainable Real Estate Asset Breakdown (3)No.

Asset TypeClassification

Location

AcquisitionPrice

Acquisition
Date

Building
Age

Expected
1
NOI/Year

Ichigo Equity
Investment

Forecast
EquityMultiple2

Forecast
IRR

3

64

RetailFixed Asset

Shinagawa-ku, Tokyo<JPY 1B

2015/01–

JPY 26M

–

–

–

66

RetailFixed Asset

Sendai<JPY 1B

2015/0216 years

JPY 65M

JPY 8M––

68

RetailFixed Asset

Shibuya-ku, Tokyo<JPY 1B

2015/04

19 years

JPY 46M

JPY 79M

–

–

69

Hotel

Fixed AssetOsaka

JPY 2B-3B

2015/05

18 years

JPY 170M

JPY 633M––

71

RetailFixed Asset

Fujisawa, Kanagawa

JPY 1B-2B

2015/07

5 years

JPY 99M

JPY 126M

–

–

110

Hotel

Fixed Asset

Fukuoka>JPY 3B

2016/0335 years

JPY 273M

JPY 905M

–

–

111

Hotel

Fixed Asset

Yokohama

JPY 2B-3B

2016/0336 years

JPY 207M

JPY 228M

–

–

112

Hotel

Fixed Asset

Yokohama>JPY 3B

2016/0333 years

JPY 239M

JPY 354M

–

–

113

Hotel

Fixed Asset

Yokohama>JPY 3B

2016/0333 years

JPY 288M

JPY 344M

–

–

114

Hotel

Fixed Asset

Fukuoka>JPY 3B

2016/04

30 years

JPY 183M

JPY 550M

–

–

115

Hotel

Fixed AssetOsaka

JPY 2B-3B

2016/04

13 years

JPY 130M

JPY 274M

–

–

116

RetailFixed Asset

Sendai<JPY 1B

2016/04

32 years

JPY 63M

JPY 86M––

118

RetailFixed Asset

NagoyaJPY 1B-2B

2016/06

23 years

JPY 83M

JPY 102M

–

–

119

RetailFixed Asset

Shibuya-ku, Tokyo<JPY 1B

2016/06

33 years

JPY 42M

JPY 136M

–

–

120

Hotel

Fixed Asset

Shinjuku-ku, Tokyo>JPY 3B

2016/09

41 years

JPY 554M

JPY 349M––

1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

53

Sustainable Real Estate Asset Breakdown (4)No.

Asset TypeClassification

Location

AcquisitionPrice

Acquisition
Date

Building
Age

Expected
1
NOI/Year

Ichigo Equity
Investment

Forecast
EquityMultiple2

Forecast
IRR

3

121

OfficeFixed Asset

Minato-ku, Tokyo>JPY 3B

2016/1019 years

JPY 1,540M

JPY 3,450M

–

–

122

Hotel

Fixed Asset

Shima, Mie<JPY 1B

2017/01

22 years

JPY 78M

JPY 73M––

132

Residential

Fixed Asset

Minato-ku, Tokyo<JPY 1B

2017/04

17 years

JPY 51M

JPY 190M

–

–

133

Hotel

Fixed Asset

Minato-ku, Tokyo<JPY 1B

2017/04

18 years

JPY 46M

JPY 152M

–

–

134

Residential

Fixed Asset

Chuo-ku, Tokyo

JPY 1B-2B

2017/04

18 years

JPY 58M

JPY 197M

–

–

138

Hotel

Fixed Asset

Ogaki, Gifu

JPY 1B-2B

2017/05

31 years

JPY 116M

–

–

–

144

OfficeFixed Asset

Chiyoda-ku, Tokyo

JPY 1B-2B

2018/0232 years

JPY 129M

JPY 268M

–

–

145

Hotel

Fixed Asset

Fukuoka

JPY 2B-3B

2018/032 years

JPY 194M

JPY 301M

–

–

146

RetailFixed Asset

Chuo-ku, Tokyo

JPY 1B-2B

2018/08

30 years

JPY 32M

–

–

–

147

Hotel

Fixed Asset

Kyoto>JPY 3B

2018/08

2 years

JPY 327M

JPY 1,666M

–

–

148

Office (Land)

Fixed Asset

Chiyoda-ku, Tokyo<JPY 1B

2018/08–

JPY 54M

JPY 166M

–

–

149

RetailFixed Asset

Chiyoda-ku, Tokyo>JPY 3B

2018/0930 years

JPY 308M

JPY 2,269M

–

–

151

OfficeFixed Asset

Fukuoka<JPY 1B

2018/1022 years

JPY 33M

JPY 38M––

152

OfficeFixed Asset

Fukuoka

JPY 2B-3B

2019/0233 years

JPY 174M

JPY 382M

–

–

154

Residential

Fixed Asset

Kita Kyushu, Fukuoka

JPY 1B-2B

2019/03

6 years

JPY 83M

JPY 181M––

1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

54

Sustainable Real Estate Asset Breakdown (5)No.

Asset TypeClassification

Location

Expected

AcquisitionPrice

Acquisition
Date

Building
Age

NOI/Year1

Ichigo Equity
Investment

Forecast
EquityMultiple2

Forecast
IRR

3

155

OfficeFixed Asset

Shinagawa-ku, Tokyo

JPY 2B-3B

2019/0335 years

JPY 169M

JPY 616M

–

–

157

OfficeFixed Asset

Chiyoda-ku, Tokyo<JPY 1B

2019/04

37 years

JPY 52M

–

–

–

158

Other

Fixed Asset

Chuo-ku, Tokyo

JPY 1B-2B

2019/05–

JPY 12M

–

–

–

159

RetailFixed Asset

Shibuya-ku, Tokyo

JPY 2B-3B

2019/05

41 years

JPY 123M

JPY 210M

–

–

160

OfficeFixed Asset

Fukuoka

JPY 2B-3B

2019/06

23 years

JPY 129M

JPY 248M

–

–

161

Hotel

Fixed Asset

Fukuoka>JPY 3B

2019/07

26 years

JPY 368M

JPY 1,636M

–

–

162

Hotel

Fixed Asset

Fukuoka>JPY 3B

2019/0722 years

JPY 353M

JPY 1,170M

–

–

164

Hotel

Fixed Asset

Chiyoda-ku, Tokyo<JPY 1B

2020/03

12 years

JPY 61M

JPY 62M

–

–

165

Hotel

Fixed Asset

Sapporo>JPY 3B

2020/031 year

JPY 268M

JPY 700M

–

–

167

Hotel

Fixed Asset

Hiroshima>JPY 3B

2020/08

1 yearJPY 306M–––

JPY 10,640M JPY 31,215M––

70 Fixed Assets

JPY 173,719M
JPY 175,241M (Book Value)

1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

55

Sustainable Real Estate Asset Breakdown (6)No.

Asset TypeClassification

Location

Expected

AcquisitionPrice

Acquisition
Date

Building
Age

NOI/Year1

Ichigo Equity
Investment

Forecast
EquityMultiple2

Forecast
IRR

3

61

RetailOperational Loan

Shinjuku-ku, Tokyo

JPY 1B-2B

2014/1257 years

JPY 120M

JPY 57M

15.26X

51.7%

89

OfficeReal Estate for Sale

Musashino, Tokyo>JPY 3B

2015/07

31 years

JPY 131M

JPY 670M

1.72X

13.3%

92

OfficeReal Estate for Sale

Fukuoka

JPY 1B-2B

2015/07

13 years

JPY 85M

JPY 353M

1.82X

17.7%

135

Logistics

Real Estate for Sale

Narashino, Chiba

JPY 1B-2B

2017/04

29 years

JPY 114M

JPY 188M

6.18X

25.8%

136

Logistics

Real Estate for Sale

Narashino, Chiba

JPY 1B-2B

2017/04

29 years

JPY 152M

JPY 203M

8.75X

32.8%

143

RetailReal Estate for Sale

Fukuoka

JPY 1B-2B

2017/09

36 years

JPY 106M

JPY 223M

3.78X

19.9%

150

RetailReal Estate for Sale

Chuo-ku, Tokyo>JPY 3B

2018/1033 years

JPY 359M

JPY 1,161M

6.17X

24.7%

153

Hotel

Real Estate for Sale

Fukuoka<JPY 1B

2019/0227 years

JPY 110M

–

–

–

156

Logistics

Real Estate for Sale

Fukuoka

JPY 2B-3B

2019/0332 years

JPY 150M

JPY 651M

3.60X

30.0%

163

RetailReal Estate for Sale

Nagoya>JPY 3B

2019/08

23 years

JPY 479M

JPY 1,146M

3.47X

17.0%

166

RetailReal Estate for Sale

Shibuya-ku, Tokyo<JPY 1B

2020/0315 years

JPY 39M

JPY 83M

3.23X

13.5%

168

OfficeReal Estate for Sale

Koto-ku, Tokyo

JPY 1B-2B

2020/1130 years

JPY 100M

–

3.17X

53.6%

JPY 1,944M

JPY 4,734M

4.28X

25.9%

JPY 12,584M JPY 35,950M––

11 Real Estate for Sale
+ 1 Operational Loan

Subtotal 82 Assets

JPY 31,415M
JPY 31,912M (Book Value)
JPY 205,135M
JPY 207,154M (Book Value)

1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.
Forecast Equity Multiple is based on the business plan of each asset and is the sum of forecast rental income and gains on sales divided by Ichigo Investment.
3 Forecast IRR is the forecast internal rate of return based on each asset’s actual cash flow. The total Forecast Equity Multiple and Forecast IRR are for Real Estatefor Sale assets acquired from FY15/2 onward and exclude Fixed Assets.
2© Ichigo Inc. All rights reserved.

56

Sustainable Real Estate Asset Breakdown (7)Acquisition
Price

Asset TypeNo.

vs. FY21/2 Q1

NOI/Year

Ichigo Equity
Investment

Forecast
EquityMultiple

Forecast
IRR

Expected
1

A

Ichigo Owners (Office & Residential)

34 Assets

JPY 22,619M-JPY 14,015M

JPY 1,163M

JPY 7,730M

–

–

B

Centro (Primarily Office & Residential)

21 Assets

JPY 7,866M+JPY 1,038M

JPY 583M

JPY 1,931M

–

–

C

Self-Storage

33 Assets

JPY 3,022M+JPY 666M

JPY 362M

JPY 1,043M––

JPY 14,694M

JPY 46,655M––

Total 170 Assets

JPY 238,643M
JPY 240,805M (Book Value)

Assets acquired in FY21/2 Q1 (3M)

Total 13 Assets

JPY 8,050M

JPY 567M

JPY 942M––

Assets acquired in FY21/2 Q2 (3M)

Total 10 Assets

JPY 9,832M

JPY 566M

JPY 1,792M––

Assets acquired in FY21/2 Q3 (3M)

Total 7 Assets

JPY 7,398M

JPY 365M

JPY 3,392M––

Assets acquired in FY21/2 Q3 (9M)

Total 30 Assets

JPY 24,831M

JPY 1,499M

JPY 6,128M––

Assets acquired and sold in FY21/2*

Total 5 Assets

JPY 3,125M

JPY 143M

JPY 2,265M––* Acquired and sold 5 Ichigo Owners assets
1

Expected NOI/ Year is based on the business plan of each asset and is the expected NOI after value-add is completed.

© Ichigo Inc. All rights reserved.

57

Ichigo Solar Power Plant Portfolio, Total 198.9MW
Ichigo Solar Power Plants (In-Development)

Ichigo Solar Power Plants (Operating)

Ichigo Tokushima Higashi-Okinosu

Shikoku

Panel
Output(MW)
2.52

JPY 40Aug 2013

Ichigo Komagane Akaho Minami

Chubu

Panel
Output(MW)
0.74

JPY 14

Aug 2021

Ichigo Fuchu Jogecho Yano

Chugoku

0.99

JPY 40Mar 2014

Ichigo Komagane Akaho Kita

Chubu

0.39

JPY 14

Aug 2021

Ichigo Yubetsu Barou

Hokkaido

0.80

JPY 40

Apr 2014

Ichigo Chiba Wakaba-ku Omiyacho Nishi

Kanto

0.74

JPY 14

Aug 2021

Kanto

0.67

JPY 40

Apr 2014

Ichigo Chiba Wakaba-ku Omiyacho Higashi

Kanto

0.74

JPY 14

Aug 2021

Ichigo Kijo Takajo

Kyushu0.89

JPY 40

Apr 2014

Ichigo Tatsunomachi Sawasoko

Chubu

0.74

JPY 14

Aug 2021

Ichigo Betsukai Kawakamicho

Hokkaido

0.88

JPY 40

Oct 2014

Ichigo Kasaoka Idachiike

Chugoku

2.66

JPY 18

Oct 2021

Ichigo Toyokoro Sasadamachi

Hokkaido

0.60

JPY 40

Oct 2014

Ichigo Sera Shimotsuda

Chugoku

2.93

JPY 18

Jan 2022

Ichigo Higashi-Hiroshima Saijocho Taguchi

Chugoku

2.72

JPY 40Jan 2015

Ichigo Obu Yoshidamachi

Chubu

1.10

JPY 18

Jan 2022

Ichigo Akkeshi Shirahama

Hokkaido

0.80

JPY 40Mar 2015

Ichigo Kobe Pompuike

Kansai

2.47

JPY 18

Jan 2022

Ichigo Hamanaka Bokujo Tsurunokotai

Tohoku2.31

JPY 36

Dec 2015

Ichigo Ueda Yoshidaike

Chubu

1.01

JPY 18Feb 2022

Solar Power Plant

Ichigo Maebashi Naegashima

Area

FIT
(Pre-tax)

Operation
Start Date

Solar Power Plant

Area

FIT
(Pre-tax)

Operation
Start Date

Ichigo Yonago Izumi

Chugoku

2.61

JPY 40Jan 2016

Ichigo Miyakonojo Takazakicho Tsumagirishima

Kyushu2.96

JPY 32

Feb 2022

Ichigo Kasaoka Takumicho

Chugoku

1.11

JPY 32

Mar 2016

Ichigo Ebino Suenaga

Kyushu13.99

JPY 40Jan 2024

Ichigo Toki Oroshicho

Chubu

1.39

JPY 36

Jun 2016

Total (In-Development)

12 Plants 30.5MW

Total (Operating & In-Development)

48 Plants 151.1MW

Ichigo Toride Shimotakai Kita

Kanto

1.03

JPY 32

Jul 2016

Ichigo Toride Shimotakai Minami

Kanto

0.54

JPY 32

Jul 2016

Ichigo Hamanaka Bokujo Kajibayashi

Tohoku2.31

JPY 36

Oct 2016

Ichigo Sera Tsukuchi

Chugoku

2.54

JPY 32

Feb 2017

Ichigo Sera Aomizu

Chugoku

2.87

JPY 32Aug 2017

Ichigo Showamura Ogose

Kanto

43.34

JPY 36

Sep 2017

Ichigo Memuro Nishi-Shikari

Hokkaido

1.32

JPY 40Feb 2018

Ichigo Kure Yasuuracho Nakahata

Chugoku

2.90

JPY 36

Mar 2018

Ichigo Tsu

Chubu

2.94

JPY 24

Mar 2018

Ichigo Kasaoka Iwanoike

Chugoku

2.64

JPY 24

Mar 2018

Ichigo Toki Tsurusatocho Kakino

Chubu

1.31

JPY 24

Apr 2018

Ichigo Itoshima Iwara

Kyushu1.48

JPY 36

Jan 2019

Ichigo Sakahogi Fukagaya

Chubu

2.89

JPY 21

May 2019

Ichigo Sennan Kitsuneike

Kansai

2.86

JPY 21

Jul 2019

Ichigo Minakami Aramaki

Kanto

12.02

JPY 36

Jan 2020

Ichigo Takashima Kutsuki

Kansai

3.74

JPY 32

Jan 2020

Ichigo Toki Tsurusatocho Kakino Higashi

Chubu

1.67

JPY 21

Feb 2020

Ichigo Hitachiomiya

Kanto

2.99

JPY 24

Mar 2020

Ichigo Hokota Aoyagi

Kanto

2.48

JPY 24

Apr 2020

Ichigo Kasaoka Osakaike

Chugoku

2.66

JPY 21

Apr 2020

Ichigo Minokamo Hachiyacho Kamihachiya

Chubu

1.29

JPY 18

Sep 2020

Ichigo Seto Jokojicho

Chubu

1.45

JPY 18

Oct 2020

Ichigo Toride Shimotakai Nishi
Total (Operating)

Kanto
2.84
JPY 1836 Plants 120.6MW

Jan 2021© Ichigo Inc. All rights reserved.

Ichigo Wind Power Plants
Wind Power Plant
Ichigo Yonezawa Itaya
Ichigo Takashinoyama
Ichigo Onjuku Iwawada Nishi
Ichigo Onjuku Iwawada Higashi
Total

Panel
FIT
Output(Pre-tax)(MW)
Tohoku7.39
JPY 22
Tohoku6.99
JPY 21
Kanto
1.99
JPY 22
Kanto
1.99
JPY 224 Plants 18.3MW
Area

Operation
Start Date
Feb 2021
Dec 2023
Dec 2024
Dec 2024

Ichigo Green (9282)
Area

Panel
Output(MW)

FIT(Pre-tax)

Ichigo Total: 198.9MW

Hokkaido
Kanto
Chubu

9.14
1.33
1.80

JPY 40JPY 40
JPY 32

Chugoku3.60

JPY 36, JPY 40

Shikoku

3.67

JPY 36, JPY 40

KyushuOkinawa
Total

1.44
8.44
29.4

JPY 36
JPY 40

Solar Power Plants: 151.1MW(Operating/In-Development)
Wind Power Plants: 18.3MW
Ichigo Green (9282)
Solar Power Plants: 29.4MW
58

Ichigo-Owned Solar Power Plant Details
Total Operating and In-Development Ichigo-Owned Solar Power Plants: 48 Plants (151.1MW)
By Feed-In Tariff

By Customer(Electric Power Utility Co)
Shikoku
2%

Hokkaido3%

JPY 14
2%

Tohoku3%

JPY 21
7%

Kyushu
13%
TEPCO
44%

Kansai6%

By Years in Operation

JPY 1810%>5 years
In Development 10%

JPY 4019%20%

JPY 248%<1 year10%

JPY 32
10%

Chubu
11%

JPY 3644%

1-3 years
23%

Chugoku18%

By Solar Intensity

By Output

2-10MW(In-Development)
7%

3-5 years
37%

C(In-Development)
2%

>10MW
(InDevelopment)
9%

<2MW
12%

<2MW
(In-Development)
4%
2-10MW
31%
>10MW
37%

A
(In-Development)
4%

Panel Output and FIT by Customer
Area

B(In-Development)
14%
A
45%

C
8%
B
27%

TEPCO
Chugoku
KyushuChubu
KansaiTohokuHokkaido
Shikoku
Total

OperatingFIT
Panel(Pre-tax)
Output
(JPY)
(MW)
66.0
18 – 40
21.1
21 – 40
2.4
36 – 40
13.0
18 – 36
6.6
21 – 32
4.6
36
4.4
40
2.5
40
120.6

Solar Intensity Rank
A: ≥4.00 B: ≥3.75, <4.00
Unit: kWh/m2 per day© Ichigo Inc. All rights reserved.

C: ≥3.50, <3.75

In-Development
FIT
Panel
(Pre-tax)
Output
(JPY)
(MW)
1.5
14
5.6
18
17.0
32 – 40
4.0
14 – 18
2.5
18
–
–
–
–
–
–
30.5
D: <3.559

Reference: Japan’s Feed-In Tariff (FIT)
What is a FIT?
‒ A policy mechanism to encourage investment in renewable energies by
guaranteeing a fixed purchase price for electricity over a 20-year contract period‒ The fixed price for new contracts is adjusted every year, but locked in forthe duration of the contract period
Wind Power FIT

Solar Power FIT
Contract Date

FIT

Guarantee
PeriodContract Date

FIT

Guarantee
PeriodFY2012

JPY 4020 years

FY2017 (4/1~9/30)

JPY 2220 years

FY2013

JPY 3620 years

FY2017 (10/1~3/31)

JPY 2120 years

FY2014

JPY 3220 years

FY2018JPY 2020 years

FY2015 (4/1~6/30)

JPY 2920 years

FY2019JPY 1920 years

FY2015 (7/1~3/31)

JPY 2720 years

FY2020

JPY 1820 years

FY2016

JPY 2420 years

FY2017

JPY 21 1

20 years

FY2018JPY 18 1

20 years

FY2019JPY 14 2

20 years

FY2020

JPY 13 3
JPY 12 4

20 years

1 FIT for >2MW non-residential solar power production determined via auction process
2 FIT for >0.5MW non-residential solar power production determined via auction process
3 FIT for 0.01 to 0.05MW non-residential solar power production

FIT for >0.5MW non-residential solar power production determined via auction process
4 FIT for 0.05 to 0.25MW non-residential solar power production

Source: METI, Agency for Natural Resources and Energy© Ichigo Inc. All rights reserved.

FIT for >0.5MW non-residential solar power production determined via auction process60Consolidated Balance Sheet: Assets(JPY million)

FY17/2
AssetsCurrent Assets
Cash and cash equivalents
Trade notes and accounts receivable
Operational loan investments
Operational securities investments
Real estate for sale
Deferred tax assets
Other
Less: allowance for doubtful accounts
Total Current Assets
Fixed Assets
Property, Plant, and Equipment
Buildings and structures (net)
Solar power plant equipment (net)Land
Other (net)Total Property, Plant, and Equipment
Intangible Assets
Goodwill
Leasehold rights
Other
Total Intangible Assets
Investments and Other Assets
Securities investments
Long-term loans receivable
Deferred tax assets
Other
Less: allowance for doubtful accounts
Total Investments and Other Assets
Total Fixed Assets
Total Assets© Ichigo Inc. All rights reserved.

FY18/2

FY19/2

FY20/2

FY21/2 H1

FY21/2 Q3

vs. FY21/2 H1

47,678
913
1,324
1,433
167,805
516
3,125
-453
222,344

45,510
1,097
1,324
2
180,789
342
2,643
-28
231,681

50,225
1,344
1,324
1,218
161,322–2,156-2
217,590

41,067
2,308
1,324
902
68,290–3,721-6
117,60846,083
1,366
1,324
617
62,357–3,625-23
115,352

50,059
1,508
1,324
608
54,720–2,383-25
110,579+3,976+142–-9-7,637–-1,242-2-4,773

7,375
7,246
18,627
12,40245,654

10,60019,773
26,993
1,190
58,55820,33819,05849,924
5,655
94,97655,05023,425
122,114
5,607
206,198

60,992
24,114125,012
5,816
215,936

60,68824,180125,0216,244
216,135

-304
+66
+9
+428
+199

1,864
62
29
1,956

1,600
135
233
1,968

1,346
316
331
1,993

1,090
687
705
2,482

1,022
1,269
842
3,134

995
1,269
1,934
4,199

-27
–
+1,092+1,065

1,426
10
339
1,820
-92
3,504
51,115
273,459

2,184
10
68
2,132
-91
4,303
64,831
296,512

2,455
10
177
2,231
-91
4,782
101,752
319,343

4,321
510
568
2,128
-91
7,436
216,118
333,726

4,423
10
616
2,282
-91
7,240
226,311
341,664

4,950
10
598
2,211
-91
7,679
228,013338,593

+527
–
-18
-71
–
+439
+1,702-3,071

61

Consolidated Balance Sheet: Liabilities & Net Assets(JPY million)

FY17/2
Liabilities
Current Liabilities
Trade notes and accounts payable
Short-term loans
Short-term non-recourse loans
Bonds (due within one year)
Long-term loans (due within one year)
Long-term non-recourse loans (due within one
Income taxes payable
Deferred tax liabilities
Accrued bonuses
Other current liabilities
Total Current Liabilities
Long-Term Liabilities
Bonds
Non-recourse bonds
Long-term loans
Long-term non-recourse loans
Deferred tax liabilities
Long-term security deposits received
Other long-term liabilities
Total Long-Term Liabilities
Total Liabilities
Net Assets
Shareholders’ Equity
CapitalCapital reserve
Retained earnings
Treasury shares
Total Shareholders’ Equity
Accumulated Other Comprehensive Income
Valuation gains (losses) on other securities
Deferred gains (losses) on long-term interest rate
Foreign currency translation adjustment
Total Accumulated Other Comprehensive Income
Stock Options
Minority Interests
Total Net Assets
Total Liabilities and Net Assets© Ichigo Inc. All rights reserved.

FY18/2

FY19/2

FY20/2

FY21/2 H1

FY21/2 Q3

vs. FY21/2 H1

110
805
611
112
5,209
6,825
1,655
62
36
4,119
19,548

–
1,042
–
112
4,449
3,921
1,609
494
34
4,652
16,316

–
3,275
–
112
7,881
1,666
3,760
–
31
5,178
21,905

–
3,086
–
274
12,277
1,178
2,416
–
33
5,013
24,280

–
5,713
–
274
6,547
1,350
1,038
–
217
3,836
18,978

–
5,472
–
274
6,671
1,350
452
–
407
4,914
19,543

–
-241
–
–
+124
–
-586
–
+190
+1,078
+565

632
100
91,60468,319
1,147
8,038
624
170,467
190,015520–
112,366
63,588
1,744
8,492
758
187,470
203,787

538–
131,569
51,068
2,164
8,292
946
194,579
216,484

6,082–
151,483
39,156
1,890
8,118
1,107
207,838
232,119

6,015–
163,466
41,737
1,853
7,955
914
221,942240,9215,974–
160,035
41,624
1,853
7,836
934
218,260
237,803-41–-3,431
-113
–
-119
+20
-3,682-3,11826,65011,05642,840-15
80,532

26,723
11,11354,324-2,99589,16526,820
11,207
66,730-5,98898,76926,885
11,272
71,505-8,988100,674

26,886
11,272
70,911-8,988100,081

26,886
11,272
72,398-10,488
100,068––+1,487-1,500
-13

117
-365
55
-192
491
2,612
83,443
273,459

543
-372
–
171
666
2,722
92,725296,512

386
-408
–
-21
827
3,283
102,859
319,343

158
-397
–
-239
988
184
101,607
333,726

-128
-416
–
-545
1,023
183
100,742
341,664

-86
-403
–
-490
1,028
182
100,789
338,593

+42
+13
–
+55
+5
-1
+47
-3,07162

Consolidated P&L(JPY million)
FY17/2(12M)
Revenue
Cost of Goods Sold
Gross Profit
SG&A
Operating Profit
Non-Operating Income
Interest income
Dividend income
Mark-to-market gains on long-term interest
rate hedges
Other
Total Non-Operating Income
Non-Operating Expenses
Interest expenses
Mark-to-market losses on long-term interest
rate hedges
Debt financing-related fees
Other
Total Non-Operating Expenses
Recurring Profit
Extraordinary Gains
Gains on sales of securities investments
Gains on sales of shares in affiliates
Gains on sales of subsidiary shares
Other
Total Extraordinary Gains
Extraordinary Losses
Loss on disposal of fixed assets
Valuation losses on securities investments
Office move expenses
Impairment loss
Earthquake-related damages
Covid-19 writedown of real estate for sale
Other
Total Extraordinary Losses
Pre-Tax Income
Income Taxes
Pre-Minority Interest Net Income
Income Attributable to Minority Interests
Net Income© Ichigo Inc. All rights reserved.

FY18/2(12M)

FY19/2(12M)

FY20/2(12M)

FY21/2 Q3(9M)

FY20/2 Q3(9M)

FY21/2Full-Year
Forecast(Revised)

Change(YOY)

vs.
Forecast

109,253
81,32727,925
5,025
22,90057,84630,86026,986
5,067
21,91983,54051,41332,126
5,847
26,27987,36052,851
34,5096,787
27,721

55,18841,915
13,273
4,721
8,551

78,15347,82330,3305,298
25,032-22,965-5,908-17,057-577-16,481

–
–
–
–
9,500

–
–
–
–
90.0%

–
85

3
57

3
68

8
78

12
75

4
74

+8
+1

–
–

–
–

–

–

5

–

158

53

+105

–

–

32
118

100
161

70
147

62
150

43
290

29
162

+14
+128

–
–

–
–

2,278

2,249

2,328

2,293

1,752

1,734

+18

–

–

53

270

491

336

55

55

–

–

–

-254
+14
-223
-16,130

–
–
–
6,800

–
–
–
96.1%

714
217
3,263
19,755

207
168
2,895
19,185

327
203
3,350
23,076

538
307
3,476
24,395

268
229
2,306
6,535

522
215
2,529
22,665

2,466
–
–
–
2,466

–
1,221
–
41
1,263

2
–
–
–
2

11
–
169
35
215

–
–
–
–
–

11
－
169
35
215

-11
–
-169
-35
-215

–
–
–
–
–

–
–
–
–
–

–
–
31
1,090
244
–
224
1,590
20,6305,436
15,194299
14,894

11
–
–
327
–
–
–
339
20,1095,923
14,185167
14,018

–
–
–
–
–
–
–
–
23,0797,333
15,746373
15,373

27
229
–
319
–
7,487
–
8,065
16,545
7,406
9,139
938
8,201

–
114
–
–
–
–
1
116
6,418
2,149
4,269
3
4,265

27
–
–
–
–
–
–
27
22,853
6,775
16,077936
15,141

-27
+114
–
–
–
–
–
+89
-16,435-4,626-11,808-933-10,876

–
–
–
–
–
–
–
–
–
–
–
–
5,000

–
–
–
–
–
–
–
–
–
–
–
–
85.3%

63

Consolidated Cash Flows from Operations(JPY million)
FY17/2 (12M)
Cash Flows from Operations
Pre-tax income
Depreciation
Share-based compensation expenses
Amortization of goodwill
Increase (decrease) in accrued bonuses
Increase (decrease) in allowance for doubtful accounts
Interest and dividend income
Interest expense
Losses (gains) on sales of subsidiary shares
Losses (gains) on sales of shares in affiliates
Losses (gains) on sales of securities investments
Impairment loss
Valuation losses on securities investments
Decrease (increase) in trading notes and receivables
Decrease (increase) in operational securities investments
Decrease (increase) in real estate for sale
Covid-19 writedown of real estate for sale
Decrease (increase) in power plant for sale
Valuation losses on SPC capital contributions
Decrease (increase) in advances paid
Decrease (increase) in accounts receivable
Increase (decrease) in accounts payable
Increase (decrease) in accrued expenses
Increase (decrease) in advances received
Increase (decrease) in security deposits received
Other
Sub-TotalInterest and dividend income received
Interest expenses paid
Income taxes paid and refunded
Net Cash from (Used for) Operations© Ichigo Inc. All rights reserved.

20,630
778
223
141
23
-3
-85
1,303
–
–
-2,466
1,090
–
-367
2,727
-6,303
–
7,251
16
-190
-193
204
92
-49
-667
1,304
25,46085-1,146-2,852
21,547

FY18/2 (12M)
20,109
1,015
215
111
32
-355
-61
2,249
–
-1,221
–
327
–
-468
1,663
-8,112
–
996
–
871
-10
573
-47
30
125
585
18,62861-2,231-5,854
10,603

FY19/2 (12M)
23,079
1,696
213
254
-3
-26
-71
2,328
–
–
-2
–
–
-247
3,509
-3,163
–
–
–
-333
-399
-332
25
269
-264
1,887
28,42071-2,118-4,61021,762

FY20/2 (12M)
16,545
2,630
194
174
2
4
-86
2,293
-169
–
-11
319
229
-903
11,682-17,447
7,487
–
–
16
29
201
-36
-285
-169
600
23,30486-2,068-9,43011,892

FY21/2 Q3 (9M)
6,418
3,432
41
94
374
19
-88
1,752
–
–
–
–
114
799
325
13,585
–
–
3
238
-10
-972
188
–
-280
735
26,77388-1,563-4,05821,23964

Consolidated Cash Flows from Investments & Financing(JPY million)
FY17/2 (12M)
Cash Flows from Investments
Payments into time deposits
Proceeds from withdrawal from time deposits
Payments for securities investments
Proceeds from sales of securities investments
Proceeds from redemptions of securities investments
Acquisitions of property, plant, and equipment
Acquisitions of intangible assets
Payments of SPC capital contributions
Redemptions of SPC capital contributions
Payments of security deposits
Acquisitions of subsidiary shares resulting in change ofconsolidation scope
Sales of subsidiary shares resulting in change ofconsolidation scope
Acquisitions of consolidated subsidiary
Other
Net Cash from (Used for ) Investments
Cash Flows from Financing
Net increase (decrease) in short-term loans
Net increase (decrease) in short-term non-recourse loans
Proceeds from bond issuance
Repayment of maturing bond principal to bondholders
Redemption of non-recourse bonds
Proceeds from long-term loans
Repayment of long-term loans
Proceeds from long-term non-recourse loans
Repayment of long-term non-recourse loans
Proceeds from employee exercise of stock options
Share buyback
Proceeds from minority interests
Payments to minority interests
Sales of subsidiary shares resulting in no change ofconsolidation scope
Dividends paid to minority interests
Dividends paid
Net Cash from (Used for ) Financing© Ichigo Inc. All rights reserved.

FY18/2 (12M)

FY19/2 (12M)

FY20/2 (12M)

FY21/2 Q3 (9M)

-6,100
201
-300
6,136
–
-11,719
-1
-63
–
-5

-6
–
-140
–
–
-4,796
-83
-28
–
-36

-118
1,060
-539
32
–
-15,440
-425
-6
32
-16

-113
5,033
-2,361
111–-11,244
-562
-2
–
-34

-7
–
-547
10
–
-13,777
-742
-3
15
–

-93

-2,619

–

–

–

–

2,096

–

–

–

–
11
-11,933–-32-5,645–-181-15,602-187-902-10,263–-21-15,075-1,383
532
785
-56
–
55,674-61,22130,850-15,400
137––-2,000

-306
-611
–
-112
-100
32,660-13,402
3,518-22,366
110-2,999
–
–

2,232
–
129
-112
–
43,062-20,352
3,500-18,473143-2,999
90
–

426
–
5,828
-193
–
49,957-26,475
5,300-17,701
95-2,999–-1,276

2,386
–
70
-177
–
48,777-45,829
3,300
-659
1
-1,499
–
–

–

–

100

–

–

-39
-1,501
6,377–-2,513-6,124–-2,9724,346-8-3,4169,537-5-3,2983,063

65

Ichigo 2030: Ichigo as a Sustainable Infrastructure Company© Ichigo Inc. All rights reserved.

66

Go for Growth
Grow & Expand Ichigo’s Core Businesses into New Areas, Creating New
Earnings Streams and Increasing Both Earnings and Earnings Stability
Sustainability

Infrastructure

Sustainability is integral to the health anddevelopment of people, society, and the environment.

Ichigo has a direct and critically important role inpreserving and improving the social infrastructure that
supports the quality of people’s lives.

Ichigo’s current core business of preserving andimproving real estate is a highly sustainable businessmodel that combines high efficiency with low
environmental impact.
Under Ichigo 2030, Ichigo will continue its longstanding commitment to sustainability whiledeveloping new technologies to extend the lives ofkey social infrastructure beyond 100 years.

By expanding its current real estate and clean energy
businesses into other infrastructure areas, Ichigo will
integrate the “hard” physical elements and “soft”
service elements of infrastructure to serve broadclient needs.
Critical to success will be unifying Ichigo’s
Sustainable Value-Add and IT capabilities. Ichigo will
work to deliver first-in-class and best-in-classsolutions to drive significant value for clients andsociety across a diverse set of infrastructures. Being
one of many is not enough. Ichigo needs to lead.

Ichigo as a Sustainable Infrastructure Company© Ichigo Inc. All rights reserved.

67

Go Beyond Real Estate to Address Significant Needs

AssetsResidential
Office

Needs

Live
Work

Nursing Care

Responding
to Diverse
Needs

Child Care

Education

Senior Business

Tourism

RetailBuy, Dine

Medical Care
Agriculture

Hotel

Stay, Travel

Solar Power
Plant

Power Lives &Businesses

StadiumEntertainment,
Recreation, & Health© Ichigo Inc. All rights reserved.

Entertainment
Public WorksSportsCultureOther
Energy68

KPI Targets
1. High Capital Efficiency− FY20/2~FY30/2 Average ROE >15%
 Increase long-term ROE by driving higher capital efficiency and earnings stability
 Via high ROE, grow long-term EPS as a key driver of shareholder value− FY20/2~FY30/2 Continuous JPX-Nikkei 400 Index Inclusion Target 11 consecutive years of inclusion

2. High Cash Flow Generation− FY20/2~FY30/2 Continuous Economic Operating Cash Flow > Net Income
 Ichigo’s robust cash flows fund both growth investments and shareholder returns
 Target 11 consecutive years of EOCF > NI

3. High Earnings Stability− FY30/2 Stock Earnings Ratio >60%
 Raise Stock Earnings ratio from FY19/2’s 53%
 Concurrently increase and diversify Flow Earnings, which are currently centered on
Sustainable Real Estate Gains on Sales

Note: Economic Operating Cash Flow = Cash Flows from Operations excluding net investment in Real Estate and Power Plants for Sale
© Ichigo Inc. All rights reserved.

69

Shareholder Return Policy
Ichigo Dividend Policy: Growth, Certainty, and Stability− Progressive Dividend Policy
 Ichigo’s progressive dividend policy underscores our commitment todriving continued organic earnings and dividend growth forshareholders. Under this policy, the dividend is maintained or raised
every year (but not cut), providing shareholders with the security of adurable dividend.
− DOE (Dividend on Equity) Payout Ratio of >3%
 Stable and growing dividend unaffected by short-term earnings volatility− Flexible Deployment of Share Buybacks (New)Dividend growth via
DOE > 3% Policy

 Conduct share buybacks to optimize capital
structure and drive shareholder value

9 Consecutive Years of
Dividend Growth
JPY 5

JPY 6

JPY 7

JPY 7

JPY 7

FY19/2

FY20/2

FY21/2(Forecast)

JPY 3
JPY 1*

JPY 1.1 JPY 1.3

FY13/2
FY14/2
FY15/2* Adjusted to reflect 200:1 stock split© Ichigo Inc. All rights reserved.

FY16/2

FY17/2

FY18/270

Ichigo 2030: New Initiatives© Ichigo Inc. All rights reserved.

71

Real Estate x Sports

Top Partner of J.League, Japan’s Professional Soccer League
Partner with J.League to Promote Community Development, Revitalize Local
Economies, and Help People Enjoy Fuller and Healthier Lives
J.League’s 100-Year Vision:
Promote Sports Development

Ichigo’s Mission:Serve Important Social Needs

J.League’s mission is to establish sports clubs rooted in local
communities, cooperating with local residents, businesses, andmunicipalities to promote community development

Ichigo believes that companies exist to serve society, andseeks to contribute to local communities as a sustainableinfrastructure company

Ichigo’s role as the only real estate company that is a J.League Top Partner:– Renovate and upgrade stadiums and help local governments find solutions for the rising costs ofoperating stadiums– Work to build stronger and healthier communities in cooperation with local residents, businesses, andmunicipalities©J.LEAGUE© Ichigo Inc. All rights reserved.

72

Real Estate x IT x Tourism

PROPERA: Ichigo's AI Hotel Revenue Management System− Maximizes Hotel Revenues and Increases Labor Productivity− Solves Issues Faced by Hotels and Supports Competitiveness− Developed PROPERA-Lite* Tailored to Hotels’ Needs* Provides limited information on pricing levels

Number of Lodging Facilities
in Japan

50,000

Number of Hotel Booking
System Users

Revenue Managers- Determine prices based on guest room
reservations and market research- Reflect prices in hotel booking
system

10,000Issues Faced by Lodging Facilities
Managing Check-in/Check-out and Revenue-

Managing Multiple Reservation Sites

Lack of revenue managers
Dependent on managers’ know-how
Differences in skill levels
Labor-intensive

Hotel
Booking System

Core Hotel System

From People to AI
Reservation
Information

Optimal Pricing
Information onreservations andsales conditions

Actual Sales Information

PROPERABusiness Alliance withTEMAIRAZU used by hotel
reservation sites such as
Booking.com

Lead time between installing algorithm leveraging Ichigo know-how
and system implementation is shortest in the industry© Ichigo Inc. All rights reserved.

73

Real Estate x Tourism

Hakata Hotels: Hotel Operations
Hotel Operator in Kyushu/Yamaguchi Region
Seeing Inbound Tourism Growth– Started operations at 3 hotels on June 1, 2019and currently operates 13 hotels

PROPERA Deployment– Generating 10 to 40% revenue increases p.a.
– Sales of PROPERA to non-Ichigo hotel
operators expected to drive Ichigo non-asset
revenue stream
Ichigo’s Hotel Il Palazzo in Fukuoka was the first building outside theU.S. to win an American Institute of Architects Honor Award in 1991

Responding
to Diverse
Nursing Care
Needs

Child Care
Education

Senior Business

The Hakata Hotels logo features hakata-ori woven silk textiles that are a local Fukuoka
craft, including the koukou shima weaving pattern in which a thick vertical line issurrounded by thin vertical lines. The thin lines represent children, and the thick lines
parents, expressing the sense of care shown within families. The multiple colors reflect
Ichigo’s values of respect for diversity. The values represented in the logo are also
resonant with Ichigo’s philosophy of Ichigo Ichie, literally meaning “One lifetime, one
encounter.”AgricultureEntertainment

Public WorksSportsCulture© Ichigo Inc. All rights reserved.

Tourism

Medical Care

EnergyOther

74

Real Estate x Entertainment x Culture x Tourism

Ichigo Animation: Anime + Real Estate Synergies
Production of New Anime Series VLADLOVE Written & Directed by Mamoru
Oshii, with Co-Director Junji Nishimura– Established Ichigo Animation in April 2019
– Introducing tenant collaboration initiatives that go beyond typical owner/tenant,hands-off leasing relationships– Collaborating across multiple industries to drive new synergies with Ichigo’s existing
businesses

New Earnings via Anime Content Streaming & Sales of DVDs, CDs, and Goods
Promote Ichigo’s AKIBA CULTURES ZONE (ACZ) as Global Anime Landmark– Increase ACZ’s value by integrating anime content & events(anime, dance, music, entertainment, retail, tourism, etc.)
 Anime-related events and sales of goods at ACZ will drive
both customer traffic & higher earnings

Responding
to Diverse
Nursing Care
Needs

Child Care
Education

Senior Business

Tourism

Medical Care×
© Ichigo Inc. All rights reserved.

AKIBA CULTURES ZONE

Public WorksSportsCulture©2020 Mamoru Oshii/Ichigo Animation

AgricultureEntertainment

EnergyOther

75

Real Estate x IT x Entertainment x Sports x Tourism

TSUBASA+: Real-World Augmented Reality (AR) Game
Investing in TSUBASA+, an AR Game that Uses Smartphone GPS
Japanese soccer manga, Captain Tsubasa, with avatars of worldclass soccer players

Game Features

Integrates real-world stadiums around the world
Users can play on-line with professional soccer players
Global launch started in September 2020
Royalties on sales

Business
Opportunity

Development by MIRAIRE Inc.

Build virtual stadiums at Ichigo assets to drive customer traffic &activity
Increase value of Ichigo assets, collaborate with hotels and retailers,promote community development, & support sports

Responding
to Diverse
Nursing Care
Needs

Child Care
Education

Senior Business

Tourism

Medical Care

AgricultureEntertainment

Public WorksSportsDevelopment by MIRAIRE Inc.
© Ichigo Inc. All rights reserved.

CultureEnergyOther

76

Website Renewal
Website Overhaul to Improve Usability & Site Content
Smartphone Version

Added New Sustainable Value-Add Examples & ESG Initiatives www.ichigo.gr.jp/en© Ichigo Inc. All rights reserved.

77

These materials were prepared to explain Ichigo’s businesses and are not for the purpose of soliciting investment inmarketable securities issued by Ichigo. Ichigo does not guarantee the accuracy of the figures, information, estimates, orother statements included herein, and accepts no responsibility for damages or losses arising through the use of the
figures, information, estimates, or other statements contained herein.
These materials are based upon information available as of the publication date, and may contain forward-looking
statements pertaining to Ichigo’s expectations, targets, plans, and strategies. Such forward-looking statements are notfacts, but are the result of management’s judgment based on information currently available. Actual operating results ordevelopments concerning Ichigo may differ substantially from those indicated by forward-looking statements. The
information enclosed is subject to revision without prior notice.
This document is a translation. If there is any discrepancy between the Japanese version and the English translation,
the Japanese version shall prevail.

Make The World
More Sustainable

Contact:
Ichigo (TSE First Section 2337)
Investor Relations
TEL: +81-3-3502-4818
E-mail： ir@ichigo.gr.jp
www.ichigo.gr.jp/en
Ichigo is Japan’s first zero-carbon listed real estate company.
We are taking responsibility for our environmental footprint by offsetting ourcarbon emissions and investing in low-carbon technologies such as solar energy.

© Ichigo Inc. All rights reserved.

78