Pressance Corporation Co., Ltd.

【JPX Security Code: 3254.T】

Company Presentation and Financial Results forthe fiscal year ended March 2017
June, 201711

Table of Contents
I. Corporate Information
Corporate Profile
Company Name Origins
Corporate History
Corporate Philosophy
Business Outline
Changes in Number of Units Sold by Area; Property Prices
Major Condominium Sales

Page

IV. Changes in Business Results

Page

… 3
… 4
… 5
… 6
… 7
… 8
… 9

Change in Sales, Ordinary Income and Net Income
Changes in Employee Numbers
Consolidated Profit and Loss Summary
Main Sales Results in the Condominium Business
Consolidated Balance Sheet Summary
Inventory Assets
Outstanding Balance of Contracts

… 22
… 23
… 24
… 25
… 26
… 27
… 28

V. Shareholder Returns, Other Topics

Ⅱ. Our Strengths/Competitive Advantages
Condominium Supply Ranking by Area
Synergy Effects from our Three Competitive Advantages(1) Sales Skills Development System(2) Sound Financial Situation(3) Superior Products

… 11
… 12
… 13
… 14
… 15

Forecast Dividend
Shareholder Returns
Selection as JPX-Nikkei Mid
and Small Cap Index component

… 30
… 31
… 32

Ⅵ. Progress on Future Growth Strategies
Ⅲ. Business Strategies
Basic Strategies
Area Strategies
Housing Business Expansion
Changes in Sales, Operating Income in the Housing Business

… 17
… 18
… 19
… 20

1. Family Condominium Business2. Area Strategies ①
2. Area Strategies ②
2. Area Strategies ③
3. M&A Strategy
4. Hotel Business
5. Overseas Business

… 34
… 35
… 36
… 37
… 38
… 39
… 40

2

11

Ⅰ. Corporate Information

3

Corporate Profile
Trade Mark:

Pressance Corporation Co., Ltd.

Founded:

October 1, 1997

Representative:

President: Shinobu Yamagishi

Location:

27th Floor Crystal Tower, 1-2-27 Shiromi, Chuo-ku, Osaka, Japan

Capital:¥1.472 billion (as of December 2016)

Number of Employees

416 (Consolidated, average age: 33.7)(as of March 2017):

223 (Non-consolidated, average age: 30.7)

Business Outline:

Planning, development, sales, and management of single-room and family condominiums
Planning, development, and operation of hotels

End of Fiscal Year:

March 31

Stock Exchange Listing:Tokyo Stock Exchange, first section (Security Code: 3254); JPX-Nikkei Index 400

Subsidiaries:

Pressance Jyuhan Co., Ltd. : Sales of family condominiums
Pressance Community Co., Ltd. : Building management and insurance agency business for condominiums
Pressance Realta Co., Ltd. : Sales and purchase of and agency business for used houses
Tryst Co., Ltd. : Construction business
Pressance Guarantee Co., Ltd. : Rent contract debt guarantee business
Pressance Real Estate Co., Ltd. : Real estate solution and consulting business
Sanritsu Precon Co., Ltd. : Planning, design, execution, sales and management of family condominiums

43Company Name Origins

Naissance

Prestige(French word for birth)

Pressance

Identity
Valued Japanese craftsmanship that
customers can trust for decades.

&

Philosophy
Create high-quality spaces forenergetic urban lifestyles.
54

Corporate History
October 1997

Founded under the name Nikkei Prestige Co., Ltd.

October 1997

Obtained a Real Estate Brokerage License (The Governor of Osaka (1) No. 45679).

November 1998

First condominium building under company brand sold: “Pressance Nanba Higashi.”

December 1998

Founded Pressance Community Co., Ltd., (currently Pacific Co., Ltd.) for building management, insurance agency business.

June 1999

Founded Nikkei Assist Co., Ltd (currently Pressance Jyuhan Co., Ltd.) to deal with family condominiums.

June 1999

Launched the real estate rental and management business.

July 2000

First sale of an in-house developed property: “Pressance Shinsaibashi EAST.”

April 2002

Changed the company name to Pressance Corporation Co.,Ltd.

May 2003

First Tokai area sale of in-house developed property: “Pressance Nagoyajo mae.”February 2005

Opened the Nagoya Sales Center.

July 2005

Changed status of the Nagoya Sales Center to the Nagoya Branch.

December 2007

Listed on the Second Section of the Tokyo Stock Exchange.

August 2008

Founded Room Pro Co., Ltd (currently Pressance Realta Co., Ltd.) to buy, sell and act as an agent for used property.

December 2008

Opened the Tokyo Branch.

October 2013

Listed on the First Section of the Tokyo Stock Exchange.

April 2014

Invested in and acquired shares of construction company TRYST Co., Ltd., making it into a subsidiary.

August 2014

Founded Pressance Guarantee Co., Ltd. To deal with the provision of debt guarantee for rental contracts.

May 2015

Founded Pressance Real Estate Co., Ltd in the real estate solution business .

August 2015

Selected as a component of the “JPX Nikkei Index 400” .

September 2016

Founded PROSEHRE Co., Ltd. to participate in real estate projects in ASEAN region and neighboring countries.

December 2016

Selected as a component of the JPX-Nikkei Mid and Small Cap Index

January 2017

Selected as a component of Loan Margin Trading Issues

65

Corporate Philosophy“Light Up One Corner”
Saicho, a Buddhist monk who founded the Tendai sect, taught that to“light up one corner” is to try one’s best in our own place and shine alight around ourselves by working for others. He said that if we all
strived to do this, eventually we would create a bright society andrealize peace and happiness for people around the world.

With the spirit of “Light up your corner”, all Pressance employees
perform their duties to the best of their ability and strive for thesustainable development of the company. We focus on our social
mission and actively do our work while keeping in mind governance,compliance, fair practice and environmental friendliness.
7

6

Business Outline

Business Areas

Major Products

Single-Room
Condominium

Hiroshima

Osaka

Kyoto

Kobe

(1R・F)(1R・F)(1R・F)(1R・F)

Hakata(1R・F)(F)

Mixed

Okinawa Nagoya Tokyo(F)(1R・F)(F)

Family Type
Condominium

Type

Area
per unit

Floor plan

Single-Room

20 ～ 50㎡

Single-room ～ 1LDKFamily50～100㎡

Mixed

20～100㎡

1LDK ～ 4LDKSingle-room ～ 4LDK

Features•Urban area
•Five minutes on foot frommajor railway station• Urban, suburban• Within 10 minutes by footfrom major railway station• Urban and suburb are both
• Within 5 minutes by foot frommajor railway station

Selection Criteria
Convenient locations (near universities, colleges, companies,
commercial facilities, etc.)
Good atmosphere (elementary and junior high school district,near companies and commercial facilities, etc.)
Closer to single–room criteria above.

8
7

Changes in Number of Units Sold by Area; Property Prices
Condo units sold: 4,336

FY 2017（Number of units; percentages by area)
3,500

2,987 units

Condominiums sold by building
Family type condominiums
Single-room condominiums(68.9%)

3,000

864
2,500

/29%

Condominium sold by Building:
The method of wholesale to sell
a condominium building to a realestate agency.

(29%)

2,000

769

1,190 units

/26%
(26%)

1,500
1,000

(27.4%)（Number of units; percentages by area)
2,500

538

95 units/45%(4.5%)
Tokai/Chukyo Area

0
Kinki Area

FY 2015

condominiums sold by building(66.6%)

Family type condominiums

401

2,000

Single-room condominiums

/19%
1,500

862
/40%

842 units(26.3%)

340/40%(2.2%)

64 units

500(1.5%)
Okinawa Area

Condominiums sold by building
Family type condominiums
Single-room condominiums(67.2%)
193/11%51 units

501 /59%

177 units(5.5%)(1.6%)

0Tokyo
Metropolitan Area

Condo units sold: 2,487
1,671 units

865
/41%
Kinki Area

Tokai/Chukyo Area Tokyo Metropolitan
Area

Okinawa Area

/34%

Average price per unit
Single-room condominiums
Family type condominiums（Number of units; percentages by area)

1,500

2,128 units

1,000

/55%
(5.5%)

/45%
(45%)

2,000

Condo units sold: 3,198

652

1,354

500

FY 2016（in millions of yen)

40
33.9

31.7

30

32.4

31.2

28.9

831
1,000

20

/50%

15.9

16.0

15.7

16.1

17.1

FY 2013

FY 2014

FY 2015

FY 2016

FY 2017474 units(19.0%)

500

160 /34%647/39%

169 units

173 units(6.8%)(7.0%)

308/65%00Kinki Area

Tokai/Chukyo Area

10

Tokyo Metropolitan
Area

Okinawa Area

8

Major Condominium Sales
Osaka
Aichi
Kyoto
Hyogo
Shiga
OkinawaTokyo
Kanagawa
OthersTotal

226 buildings
120 buildings
66 buildings
53 buildings
9 buildings
15 buildings
12 buildings
2 buildings
7 buildings
510 buildings

14,799 units
7,612 units
3,211 units
4,129 units
1,355 units
689 units
660 units
226 units
475 units
33,156 units(Note) The numbers of buildings and units are accumulated figures from
November 1998 to March 31 2017.

Pressance Shin-Osaka The City
(Osaka City)
Pressance Loger Karasuma Gojo
(Kyoto City)

Pressance Loger Kobe Port Island(Kobe City)

Pressance Sakae Rise
(Nagoya City)

Pressance Loger Osaka Fukushima(Osaka City)

9

Ⅱ. Our Strengths/Competitive Advantages

11

Condominium Supply Ranking by Area
Condominium Supply Ranking
Kinki Area

RankedTokai/Chukyo Area and Nagoya CityJapan

RankedRankedNo.1

No.1
for 6 consecutive years

for 7 consecutive years

for 5 consecutive years

No.4

in Nagoya Cityin Tokai/Chukyo Area

１位

Pressance
Corporation Co.,Ltd:

2,435
units

１位

Pressance Corporation
Co., Ltd:

768
units

1位

Sumitomo Realty &Development Co., Ltd.:

6,034
units

２位

Nihon Eslead
Corporation:

1,476
units

２位

Daikyo Incorporated.:

330
units

2位

Mitsui Fudosan
Residential Co., Ltd.:

4,320
units

３位

Wada Kohsan
Co., Ltd.:

800
units

３位

Meitetsu Real Estate
Development Co. Ltd.

315
units

3位

Nomura Real Estate
Development Co., Ltd.:

4,056
units

４位

Kintetsu Real
Estate Co., Ltd.:

730
units

４位

Nomura Real Estate
Development Co., Ltd.:

264
units

4位

Pressance Corporation
Co., Ltd:

3,225
units

５位

Tokyu Land
Corporation:

713
units

258
units

5位

Mitsubishi Jisho
Residence Co., Ltd.:

3,215
units

５位

Mitsui Fudosan
Residential Co., Ltd.:* According to 2016 research by Real Estate Economic Institute Co.,Ltd. (as of February 2017)
Total number of units supplied in the period between January and December 2016.

1211

Synergy Effects from our Three Competitive Advantages

Higher asset
values(1) Sales Skills
Development
System(3) Superior
Products

Lower finishedgoods inventory(2) Sound
Financial Situation

Advantageous and prompt
procurement
12(1) Sales Skills Development System
General skills for dealing with customers, (manners, product briefings etc.)

Train new employees(educate them to immediately
contribute to our business)

New employees

RepeatSales Activities“successful experiences”⇒
Raise the sales skills of
new employees effectively
Creating synergies byencouraging staff competition

Fair evaluations for all
employees based on actual
achievements⇒

New hires are immediately assigned to the sales department and receive
one-on-one training (O.J.T) from management-level staff

After initial sales work from new employees, managers close deals⇒ If new staff see signs of potential business, through inquiries, signal of interest⇒ Managers take over sales from there.
⇒ New employees learn how to deal with customers and promote products, andaccompany their managers to accumulate “successful experiences.”⇒ New employee/manager teams compete with senior staff.
⇒ Fair competition between equally matched senior staff and teams enhances the

motivation of all employees and maximizes their achievements.
⇒ New employees appraised on all contracts closed by their managers after taking
over sales activity⇒ Managers evaluated on aggregate team results (no just personal achievements),
so they work hard to help new staff get deals⇒ Personnel evaluation is based solely on performance and achievements, regardlessof the age or length of employment.

Opportunities for pay rises and promotion twice a year.

Repeating successful experiences + fair competitions = sales skills development

13②Sound Financial Situation
Outstanding Borrowings andOutstanding Orders

Inventory Assets (consolidated)(¥million)

20.0%(¥million)
122,174
Inventory of finished goods
120,000

120,000

Real estate in process for sale
100,000

100,000

Return on Equity (ROE)

Outstanding borrowings

19.4%

119,281

Outstanding orders（sales contracts concluded） 101,101

18.9%

19.0%

18.5% 18.2%

88,37680,00060,00080,00068,85460,00046,91240,00055,02076,82965,30756,706

18.0%
17.0%

33,54740,00024,423
14,32420,0003,638
0FY2014

4,173
2,602

FY201516.0%

FY2017

16.6%

20,00015.0%

0FY201619.2%

FY2014FY2015FY2016FY2017FY2012 FY2013 FY2014 FY2015 FY2016 FY2017■ Double-digit percentage growth in■ Increase real estate each term for future sales ■ Outstanding orders exceeding borrowings
net income for seven straight terms
and profits■ Early repayment of project loans■ Share buybacks during FY 2016
■ Minimal inventory of finished goods■ Good relationships with financial institutions■ Maintain high ROE→ Borrowing on favorable terms

Positive financial cycle generated by active procurement, solid sales, and favorable borrowing terms
 Selected as JPX 400 component in August 2015 after meeting specific criteria for three indicators (operating income, ROE, and market
capitalization,) over the previous three years.
 Also, selected as the JPX-Nikkei Mid and Small Cap Index component. Index is composed of companies increasing corporate value in asustained manner as well as conducting shareholder-conscious management, while companies with mid/small cap account for the
majority of listed companies.

15
14

(3) Superior Products
Location: focus on convenience ⇒ Within 10-minutes walk of major railway stations in urban areas
Facilities: focus on luxury, comfort and functionality ⇒ High-value added
Price: High cost performance ⇒ Reasonable selling prices
Comfort
1. CATV (Up to 159 channels)
2. Sound proof window T-2
3. Sound insulation flooring

Functionality
1. Prefabricated bath with abathroom laundry dryer
2. Floor heater with heatedwater by gas
3. Auto light sensor

Both high asset value and high brand value for a long period of time16
15

Ⅲ. Business Strategies

17Basic Strategies
Flow Business
Single-Room Condominium

Family Condominium

Hotelbusinessbusinessbusiness

Single-Room and Family Condominium
business synergies grow-Two businesses mentioned above boost eachother with individual unique strengths.

•

Brand awareness has increased throughadvertisements for family condominiums
Our single-room condominium business canachieve high profitability, significantly lowering
advertising costs by utilizing awareness offamily condo business.

•More opportunities for future growthin the single-room condo business•••

Exploiting new customers with potential needs.
Gaining higher market share by our strong
competitive edges.
Expanding to new geographic areas.

18

17

Area Strategies
Maintaining the top share by the high-density development through “Dominant” strategy
 We focus on the areas we can clearly show our competitive advantages.
 We keep the top share by the high-density development through the dominant strategy in target areas.
 Secure top share and forge solid footing in the old areas to steadily increase share in other new areas.
“Dominant” strategy’s advantages

Cumulative number of our brand condominiums sold fromthe foundation to December 31, 2016.

Kinki area
340 Buildings,
22,421 Units

Tokai area
113 Buildings,
7,357 units

Okinawa area
15 Buildings
689 UnitsA)

Supply many condos in certain areas intensively toquickly increase brand recognition and company trust

B)

Gain ample information in a timely manner throughclose connections with regional real estate brokers
that we generate thorough mass transactions.

C)

Secure large market share and establish high barriers
to market entry for emerging competitors.

D)

Maximize the cost-effectiveness of advertisingexpenses by focusing media promotion (TVcommercials, etc.) on limited areas.
19

18

Housing Business Expansion
Units

Expansion of the rental property
management business
Secure profitability for owners, reduce theirrental property management burdens andmaintain high occupancy rates

Number of rental properties managed (Left axis)

16000

300

Number of buildings managed (Right axis)
14,47814000
250
12,20412000
10,858

Expansion of the building
management business
Maintain the asset value of property for along period of time through finely-tuned
management by expert staff

Expansion of the condominium
rental business
Own superior rental properties such as
single-room condominiums

200
9,699

10000
8,781
8,274
8000

7,780

150
282
241

6000
197

100

168
4000
113

126

139
50

2000

Secure stable sources of income

00FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017(Reference)
Number of rental properties managed: Pressance Corporation Co.,Ltd
Number of buildings managed: Pressance Community Co., Ltd.
20

19

Changes in Sales, Operating Income in the Housing Business（¥100 million)
40

37.8

Sales in the (Housing) Stock Business
Operating Income in the (Housing) Stock Business

35

32.4

30

25

30
25.8

20

25
18.3

20
14.8
15
11.0
10

12.5

12.1

8.3
6.5

5
4.1

0

15.4

15

16.7

7

8.1

8.4

12.7

10

9.5

5

4.5

2.1

0

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

September 2008: Collapse of Lehman Brothers

21

20

Ⅳ. Changes in Business Results

22Change in Sales, Ordinary Income and Net Income(Millions of yen)

(Millions of yen)

140,000

Sales

Ordinary Income

20,000Net Income

17,818120,000

15,414
126,562

13,798100,000

101,083

12,065
10,26480,0009,329

12,176

65,641

4,836
24,352

5,326

4,711
31,88420,0002,706 2,814

31,88042,34936,99834,086

2,641

10,00010,52651,755

5,468
40,00078,9907,464

60,00015,000

9,194
7,758

6,286

5,000

5,351
4,096

2,975
0

0
FY2008FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2016FY2017

September 2008: Lehman Brothers collapse
The Liberal
Democratic Partyin power

The Democratic
Party of Japanin power

FY2018(Forecast)

The Liberal Democratic Partyin power

22
231

Changes in Employee Numbers
Our increasing competitive strengths and profits
come from employee number growth(Number of people)(Unit: million yen)

As of March 2017

140,000
Sales
Ordinary Income
Number of employees (The Pressance Group)
Number of employees (Sales reps: Single-room condominium)
Number of employees (Sales reps: Family type condominium)

120,000

416

450

126,562
400

350
325
100,000

101,083299
300
78,99080,000240

187

60,000

200

169

167

65,641

203

196

250

51,755155

150

42,34940,00031,88431,88024,35220,000

60
42
4,836

68

64
50
5,468

56
4,711

34,08636,998

71
58
5,326

74
63
7,464

112
76

79

74

83

9,329

10,26485
92
12,065

90
100

110
96

17,818

13,79815,414FY2016FY20175000FY2008FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY2018(Forecast)

September 2008: Collapse of Lehman Brothers

2324Consolidated Profit and Loss Summary
Double-digit profit growth rate for seven straight years has achieved new record highs（¥million)

Sales

FY2015FY2016FY2017(Ratio to sales)(Ratio to sales)(Ratio to sales)

65,641

78,990(100.0%)COGS

45,903( 69.9%)Gross margin

19,737( 30.1%)

SG&A expense

7,475( 11.4%)

Operating income

12,262( 18.7%)

Ordinary income

12,065( 18.4%)

Net income
Attributable to shareholders ofparent company

7,758( 11.8%)(100.0%)55,611( 70.4%)23,379( 29.6%)9,321( 11.8%)14,057( 17.8%)

13,798( 17.5%)9,194(11.6%)

101,083(100.0%)73,651( 72.9%)27,432( 27.1%)

11,786(11.7%)

15,645( 15.5%)

15,414( 15.2%)

10,526( 10.4%)

YoY (%)FY2018
Forecast(Ratio to sales)＋ 28.0%126,562

YoY (%)
Forecast＋ 25.2%(100.0%)＋ 32.4%

93,462＋ 26.9%( 73.9%)＋ 17.3%

33,100＋ 20.7%( 26.2%)＋ 26.5%

14,798＋ 25.6%( 11.7%)＋ 11.3%18,301＋ 17.0%( 14.5%)＋ 11.7%

17,818＋ 15.6%( 14.1%)＋ 14.5%

12,176( 9.6%)＋ 15.7%25
24

Major Sales Results in the Condominium Business(¥million)
FY2015FY2016

No. of
Units

YoY
(%)

AmountYoY(%)

No. of
Units

YoY
(%)

955

77.1%

15,005 75.9%

1,366

143.0%

Family type1,300 167.7%
condominiums

41,180 156.6%

1,429 109.9%*Condominium
building sales

3,475 133.3%

401

Single-room
condominiums

217

87.1%

184.8%FY2018
Forecast

FY2017

YoY
(%)

YoY
(%)

YoY
(%)

Amount21,966 146.4%

1,892 138.5% 32,453 147.7%

29,28290.2%

44,931 109.1%

1,544 108.0% 50,450 112.3%

66,577132.0%

224.4% 11,971 243.2%

19,300161.2%

Amount4,922

141.6%

No. ofUnits

900

AmountHotel sales

Total

YoY
(%)

2,720

2,472 109.3% 59,661 122.6%

3,196

129.3%

71,821 120.4%

4,336 135.7% 94,875 132.1%

117,881124.2%*Condominium building sales: Wholesale of condominium buildings to real estate agencies.

25

Consolidated Balance Sheet Summary(¥ million)
FY2015(Ratio to sales)

FY2016(Ratio to sales)

FY2017(Ratio to sales)

94,070117,887

171,810Of these, real estate for sale

2,602

4,173

14,324※1

Of these, real estate
In process for sale

68,85488,376

122,174※2

Fixed assets

7,478

6,390

13,497

101,549

124,277

Liquid assets（92.6%）（7.4%）

Total assets（100.0%）Current liabilities

28,647（28.2%）Of these, short-term interestbearing liabilities

Fixed liabilities

Total liabilities※1 Real estate for sale:¥14,324 million※2 Real estate in process for sale:¥122,174 million

22,171（17.8%）

185,307（100.0%）49,438（26.7%）

25,41028,26951,781

76,253

27,831

51,29775,691

56,91673,953

125,691（41.7%）（59.5%）

44,63250,324

101,549

124,277（44.0%）

Total liabilities and net assets（100.0%）（7.3%）

5,408（56.0%）

Total net assets（5.1%）（92.7%）

1,835（27.8%）Of these, long-term interestbearing liabilities（94.9%）（100.0%）（40.5%）（100.0%）Land cost for condominium business: ¥3,901 million (1)Other land cost:¥276 million #Construction cost:¥10,146 million
Land cost for condominium business: ¥74,960 million (2)Other land cost:¥12,326 million #Construction cost:¥34,888 million（41.1%）（67.8%）

59,615（32.2%）

185,307（100.0%）

Moe details of Land costs (1) and (2) are
explained on page 27# mainly land cost for pre-owned real estates27
and related costs to the sales of new houses.
26

Inventory Assets for FY2017 (Land Already Acquired)
Category

FY2017
Inventory Assets(Land Already Acquired)Projections based on FY2017 delivery results

No. of Units

Amount(¥million)

Single-room condominiums

5,103

19,264

Figure in left column is equivalent to the sales volume for more than
three years up to FY2020, assuming annual delivery of about 1,700 units

Family-type condominiums

5,850

46,715Figure in left column is equivalent to the sales volume for more than
three years up to FY2020, assuming annual delivery of about 1,900 units

Condominium building sales

1,961

7,363

Figures in left column is double the sales result in FY ending March 2017,of 900 units.

Hotel sales

1,180

5,518

Includes the portions scheduled for delivery in FY2018 and FY2019.

Total

14,09478,861* Total of land costs (1) and (2) on page 26(Notes) 1. The number of units for inventory assets consists entirely of the properties that land settlement (delivery) has been completed.
In addition to the figures above, about 3,500 units in 45 buildings properties have been already contracted but have not beendelivered , planed to do so in the quite near future. Approximately, 2,300 units are for single-room condos, 850 units are forfamily type condos, and 350 units are for hotel rooms.
2. The amount of total inventory assets, ¥78,861 million, is calculated, deducting construction cost, ¥10,146 million + ¥34,888 million,
and other land cost, ¥276 million + ¥12,326 million, from the total of real estate for sale, ¥14,324 million(1) and real estate inprocess for sale, ¥122,174 million(2) listed on the balance sheet in the FY2017 on page 26,
3. Inventory Assets (lands):¥61,211 million at the end of FY2016¥61,676 million 1st Q in FY 2017
¥64,205 million 2nd Q in FY 2017¥75,635 million 3rd Q in FY 201728
27

Outstanding Balance of Contracts (Outstanding Orders) FY2017■End-FY2017 Outstanding Balance of Contracts
Details
Category
Single-room
condominiums
Familycondominiums

Condominium
building sales
Hotel sales
Total

FY2018Firm Scheduled Delivery
AmountNo. of Units(¥million)

From FY2019
Firm Scheduled Delivery
AmountNo. of Units(¥million)

No. of Units

Amount(¥million)

783

13,249783

13,249

0

0

2,056

78,816

1,341

50,948715

27,867

1,244

18,536

1,097

16,514

147

2,022

501

8,461

183

2,720

318

5,740

4,584

119,064

3,404

83,433

1,180

35,630■FY2018 Progress on Outstanding Orders
FY2018FY2018 Projected Sales

Outstanding Orders with Firm Scheduled Delivery

Category

Single-room
condominiums
Familycondominiums

Condominium
building sales
Hotel sales
Total

No. of Units

Amount(¥million)

Amount(¥million)

Progress Against Projected
Sales(%)

783

13,24929,282

45.2%

1,341

50,94866,577

76.5%

1,097

16,514

19,300

85.6%

183

2,720

2,720

100.0%

3,404

83,433

117,881

70.8%

28

V. Shareholder Returns, Other Topics

30

Forecast DividendFor FY2018, the interim dividend per share is forecasted at 12.5 yen, with the FY-end dividend is expected to be 12.5 yen. Therefore, thetotal annual dividend is forecast at 25 yen per share, an increase of 3.85 yen.
For FY2017, a plan for an annual dividend of 21.15 yen per was determined at a May 29 2017 board meeting.
Our group's basic policy of profit distribution is to pay dividends in a stable manner twice a year (one interim and one year-end dividend).
We balance dividend payment against internal reserves that are critical for future growth and business development. We consider
business situations and conditions to provide shareholders with suitable returns.

Annual dividends (yen)Date

FY2018 E
Forecast

Secondquarter

Fiscalyear end

Total

12.50

12.50

25.00

YoY
dividend
growthrate

Total
dividends Dividend
payoutratio（Unit: 100 million yen）
1000

（Unit: yen）
30

DPS
Market cap.

900

826

25

800

663
20

700

587
600
25.00

FY2017(afterstock split)

FY2016
converted
4-for-1

8.75

12.40

21.15

15

500

Year-end est.：12.50

400

0.00

15.00

15.00

21.15

10

300

15.00

FY2015converted
4-for-1

Mid-term est.：12.50

412

12.50

0.00

12.50

12.50

12.50

200

5

100

FY2014
converted
4-for-1

0.00

12.50

12.50

* 2016/ 9 Started interim dividend payment
2016/10 4-for-1 stock split

00
FY2014
2014/3期

FY2015
2015/3期

FY2016
2016/3期

FY2017*2017/3期※

FY2018 E

Forecast

31
30

Shareholder Returns
We started paying interim dividends since previous fiscal year and conducted a four-for-one common
stock split as of 1 October 2016 to improve liquidity and further expand the investor base.
Dividend per share(Unit: yen)
225
200
175
150

207

＊ The details of the shareholder benefit plan and the criteria for perks.
Number of shares owned
Details・100 shares or more and less than 400 shares ⇒ JTB Nice Gift equivalent to 2,000 yen
・ 400 shares and over
⇒ JTB Nice Gift equivalent to 5,000 yen

178
152

＊ Cash dividends per share and net income shown in this slide are the figures
calculated based on the 4-for-1 stock split conducted on 1 October 2016.

125

126

103
88

100

68

75

52

47

50
25

Net income per share

6 .2 5

6 .2 550

44
6 .2 5

6 .2 5

8 .7 5

8 .7 5

1 2 .5 0

1 2 .5 0

1 5 .0 0

2 1 .1 5

12.5
12.5

0
FY2008FY2009FY2010FY2011FY2012FY2013

FY2014FY2015FY20162 5 .0 0

FY2017FY2018(forecast)

December 2007:
Listed on the Second
Section of the Tokyo
Stock Exchange

September
2008: Collapseof Lehman
Brothers

April 2011: Stocksplit for 200
shares

October 2013: Listedon the Second
Section of the Tokyo
Stock Exchange

a 4-for-1 stock split
on 1 October 201632

31

Selection as a component of JPX-Nikkei Mid and Small Cap Index
Selected as a “JPX-Nikkei Mid and Small Cap Index” and “Loan Margin Trading Issues” component
Pressance Corporation was selected for JPX-Nikkei Mid and Small Cap Index, jointly developed by the Tokyo Stock Exchange,
Inc., and Nikkei, Inc., in December 2016 in addition to JPX-Nikkei Index 400.
The JPX-Nikkei Mid and Small Cap Index is specialized in mid- and small-size companies of the JPX-Nikkei Index 400.
Pressance Corporation was ranked No. 11 among the 200 components of the index and ranked No. 1 in the real estate industry,based on ROE, operating profit, and other indicators.
(estimated ranking of JPX-Nikkei Mid and Small Cap Index by Mizuho Securities Co., Ltd.)
Pressance Corporation has been selected as a Standardized Margin Trading Issue on the first section of the Tokyo Stock
Exchange. It was also selected as a Loan Margin Trading Issue on 31 January 2017. This new selection is expected to increase
the liquidity of and demand for our stock.
These selections are expected to induce more trading of and a fairer price for our stock on the market.
An estimated ranking of JPX-Nikkei Mid and Small Cap Index constituents（Source : Estimated by Mizuho Securities Co., Ltd.)

Quantitative ranking

Code

Stock nameMarket

TSE 1st section
JASDAQTSE 1st section
Sumitomo Mitsui Construction
TSE 1st section
NojimaTSE 1st section
CONEXIOTSE 1st section
FPG
TSE 1st section
TABUCHI ELECTRIC
TSE 1st section
KASAI KOGYO
TSE 1st section
SEIKO HOLDINGS
NuFlare Technology JASDAQ
PRESSANCE CORPORATION TSE 1st section
TSE 1st section
Clarion
EAGLE INDUSTRY TSE 1st section
ELECOM
TSE 1st section
KANAMOTO
TSE 1st section
United Arrows
USEN

Category

Marketcap.

3-yearaverageROE

3-yearcumulative
operating profit

Additional qualitative item
Outsidedirectors

IFRS
adoption

TDnet English
disclosureFinalranking

JPXNikkei
Mid Small

Selectionanticipated
stock

JPXNikkei400

RetailTrade
Information &Communication

Construction
Retail Trade
Information &Communication
Securities &Commodity Futures
Electric Appliances
Transportation Equipment

Precision Instruments

Machinery
Real EstateElectric Appliances

Machinery
Electric AppliancesServices

33
32

Ⅵ. Progress on Future Growth Strategies34

1. Family Condominium Business■

Progress on sales of major large-scale projects

・“Pressance Legend Sakaisuji-Hommachi Tower”
An earthquake-resilient, 30-story skyscraper
Address: 1-chome, Kyutaromachi, Chuo-ku, Osaka City
【Contracts closed as of the end of FY2017】
Contracts have been closed for289 out of 337 units.
*including priority sales units

85.8% closing rate

We are making steady progress toward the handover in March 2018.
2-minute walk from the “Sakaisuji-Hommachi” Station of
Osaka Municipal Subway Sakaisuji Line and Chuo Line・ “Pressance Legend Lake Biwa”
One of the largest condominium residences on the
shores of Lake Biwa, with lake views from every unit.
Address: Chagasaki, Otsu City, Shiga Prefecture【Contracts closed as of the end of FY2017】
Contracts have been closed for
364 out of 486 units.**including priority sales units

74.9% closing rate

We are making steady progress toward the handover in June 2018.

7-minute walk from JR Kosei Line “Otsukyo” Station
35

34

2. Area Strategies ①■

Projects in new areas: Hiroshima and Hakata【Background to entering Hiroshima & Hakata markets】

Business Areas
Osaka

Kyoto

Kobe

Hiroshima

HakataOkinawa

NagoyaTokyo(1R・F)

 Central Hiroshima and Hakata are considered prominentmarkets for condos in Japan because of the number ofcorporations, schools and commercial facilities in the areas.
 These areas are well-known for sightseeing, and inboundtourist demand is expected to increase. Development of thehotel business is also under consideration as well as
condominium business.
As our business development has been successful inTokai/Chukyo metro area, we will increase our market share in
new areas, supplying products and services that fulfill regional
needs by developing single-room, family and combined condos,
hotels and houses.

【Hiroshima】(1) Kokutaijimachi, Naka-ku, Hiroshima【110 single-room units near Hiroshima Electric Railway (Hiroden)
Chudenmae Station](2) Matobacho, Minami-ku, Hiroshima【84 family units near Hiroden Matabacho Station】(3) Minamimachi, Minami-ku, Hiroshima【127 family units near Hiroden Minami-kuyakusho-mae Station】(4) Noboricho, Naka-ku, Hiroshima【126 hotel rooms near Hiroden Ebisu-cho Station】* (5) Kaminoboricho, Naka-ku, Hiroshima【48 family units near Hiroden Jogakuin-mae Station】* (6) Naka-ku, Hiroshima【52 family units near major stations along the Hiroden line】【Hakata】(1) Shimogofukumachi, Hakata-ku, Fukuoka【 72 family units near Gofukumachi Station (Fukuoka City Subway
Hakozaki Line)】(2) Kamikawabatamachi, Hakata-ku, Fukuoka【 212 hotel rooms near Nakasu-Kawabata Station (Fukuoka City
Subway Hakozaki Line)】* (3) Yakuin, Chuo-ku, Fukuoka【 33 family units near Yakuin Station (Nishitetsu Tenjin Omuta Line)】* (4) Hakata-ku, Fukuoka【 47 family units near major stations along JR Kagoshima Main Line】

36Fukuoka.
* Since the end of 3Q, there has been an increase of two family condominium buildings in Hiroshima and two family condominium buildings in
35

2. Area Strategies ②■

Planned sites for projects in new areas: “Hiroshima”⑤
Hiroshima Station④②①

Planned sites for projects

⑥

③

37

36

2. Area Strategies ③■

Planned sites for projects in new areas: “Hakata”④①②
Hakata Station

Planned sites for projects③(1) Shimogofukumachi, Hakata-ku, Fukuoka【 72 family units near Gofukumachi Station (Fukuoka City Subway Hakozaki Line)】(2) Kamikawabatamachi, Hakata-ku, Fukuoka【 212 hotel rooms near Nakasu-Kawabata Station (Fukuoka City Subway Hakozaki Line)】(3) Yakuin, Chuo-ku, Fukuoka【 33 family units near Yakuin Station (Nishitetsu Tenjin Omuta Line)】(4) Hakata-ku, Fukuoka【 47 family units near major stations along JR Kagoshima Main Line】
3837

3. M&A Strategy■ Expanding condominium business through M&A■Sanritsu Precon Co., Ltd. (became a wholly owned subsidiary in November 2016)
Head office: Aichi
Business: Planning, construction, sales, and management of family condominiums<Summary>
・Planning, construction and unit sales of 80 units in 3 buildingsin Tokai/Higashimikawa area in FY 2018.
・Contracted for construction of family condominiums, with48 units developed by Pressance Corporation in Hamamatsu City,
Shizuoka Prefecture
・Contracted for sales of above properties■Lala place Co., Ltd. (became a fully owned subsidiary in April 2017)
Head office: Osaka
Business: Planning and sales of single-room condominiums<Summary>・Acquire 120 single-room condominium units as company-owned
properties for sale in this term・Also selling Pressance brand units alongside company-owned properties

3938

4. Hotel Business■

Progress on 14 properties; acquisition of one property
Since the end of 2Q, three new properties added; currently developing a total of 14 properties.
Also, acquired (for ownership) one existing hotel in operation.

(Completion Schedule)
FY2018Osaka, Inari, Naniwa-ku (A)Osaka, Motomachi, Naniwa-ku (A)Osaka, Hirano-machi, Chuo-ku (C)【72 rooms near JR Namba Station】【111 rooms nears JR Namba Station】【116 rooms near Kitahama Station (Subway Sakaisuji Line)】(A)
To be sold to hotelbusinesses

FY2019Osaka, Shikitsu-higashi, Naniwa-ku (A)【300 rooms near Daikokucho Station (Subway Midosuji Line)】
2019/3期 Osaka, Minami-semba, Chuo-ku (C)【124 rooms near Shinsaibashi Station (Subway Midosuji Line)】
8 properties
Kyoto,Omiya-dori, Shimogyo-ku (A)【122 rooms near Hankyu Railway Omiya Station】
Hiroshima,Nobori-cho, Naka-ku (B)【126 rooms near Hiroden Ebisu-cho Station】
Fukuoka, Kamikawabata-machi, Hakata-ku (A)【204 rooms near Nakasu-Kawabata Station (Fukuoka City Subway Hakosaki Line)】(B)
Osaka, Nishi-miyahara, Yodogawa-ku (A)【120 rooms near JR Shin-Osaka Station】
To be owned by【256 rooms near JR Kannai Station】
Yokohama, Minato-cho, Naka-ku (B)Pressance with
【215 rooms near Hommachi Station (Subway Midosuji Line)】
Osaka, Honmachi, Chuo-ku (A)management outsourced【63 rooms】
Kyoto, Nakagyo-ku (C)to a hotel management
FY2020

Osaka, Nishinakajima, Yodogawa-ku (A)Kyoto, Shimogyo-ku (B)(Acquired)
FY2017
Kobe, Goko-dori, Chuo-ku (B)company
4 properties【152 rooms near Nishinakajima Station (Subway Midosuji Line)】【137 rooms】【135 rooms near JR Sannomiya Station】

18.34

25.80

(C)
To be owned by
Pressance andmanaged jointly witha hotel managementcompany
3 properties

40

39

5. Overseas Business■

Progress on Overseas Business with Partner Sanei Architecture Planning Co., Ltd.
■Ho Chi Minh Project (Vietnam)
Regarding progress on development of a large-scale condominium in Ho Chi Minh
City, Vietnam, by our affiliate Prosehre Co., Ltd., which was announced in November
2016, an application is currently pending for construction approval in connection
with partial changes to the initial plan.
Steady progress is being made toward completion of construction in April 2020 asinitially scheduled. Sales for the project will commence in November 2017 as
initially scheduled.

Ho Chi Minh Condominium (rendering)<Project Overview>
Location: Ward 7, 3.5 km from central Ho Chi Minh City
Site area: 10,076.6 ㎡
Total floor area: 72,551.5 ㎡ Total of 504 units
Construction period: Start October 2017 – Complete April 2020 (scheduled)
Planned overall project sales: Approx. ¥5.8 billion■Inglewood Project (California, U.S.)
Regarding apartment complex development in Inglewood, California, U.S. A.,announced in March 2017, procedures are currently being carried out to establish a
local subsidiary named MPD Realty, Inc., and negotiations are simultaneously taking
place with local authorities regarding the construction plan.
<Project Overview>
Location: Centinela Avenue, around 6 km east of Los Angeles International Airport in California
Site area: 3460.63 ㎡
Total floor area: 9856.69 ㎡ Total of 116 units
Construction period: Start August 2017 – Complete February 2019 (scheduled)
Planned overall project sales: Approx. ¥4.7 billion
California Apartment Complex (rendering)*Renderings are subject to change.

40
41

Pressance Corporation Co., Ltd.
(Note) Prospective numbers listed in the earnings outlook and other materials are based on information
available at the time the documents were released and in large part contain uncertain factors.
The actual results may be different depending on changes in business.

<For inquiries, contact>
Management headquarters
Pressance Corporation
TEL: 06-4793-1650 (main)
FAX: 06-4793-1651
E-mail: psc@pressance.co.jp

42