FY16/2 Corporate Presentation
April
2015
April 23,
19, 2016

Ichigo (2337)© 2016 Ichigo Inc. All rights reserved.

www.ichigo.gr.jp/english

© 2016 Ichigo Inc. All rights reserved.

© 2016 Ichigo Inc. All rights reserved.

Building a richer future together© 2016 Ichigo Inc. All rights reserved.

We express our deepestWdt condolencesd l
tto allll
who have suffered from the recent
earthquakes in Kumamoto.

© 2016 Ichigo Inc. All rights reserved.

FY16/2 Full-Year Earnings‒ Operating Profit & EPS 1.9X YoY‒ Revised Forecasts Up Twice‒ Segment P&L Breakdown‒ Achieved All Shift Up 2016 KPIs

New MTP Power Up 2019
‒ Power Up 2019
‒ Powerful Value
Value-Add
Add Business Model

Appendix: Financial & Real Estate Data

Powerful Value-Add Business Model
Underpins Growth‒ Ichigo Hotel REIT (3463) Listing‒ On-Going Ichigo Office REIT (8975) Growth‒ Value-Add as Earnings Driver‒ Value-Add Case – Kyoto Hotel‒ Value-Add Case – Tokyo Retail‒ National Solar Power Plant Portfolio‒ Capital-Efficient Asset Acquisitions‒ Strong Financial Position© 2016 Ichigo Inc. All rights reserved.

6

FY16/2 Full-Year Earnings© 2016 Ichigo Inc. All rights reserved.

7

Operating Profit and EPS 1.9X YOY(Million Yen)

FY15/2

FY16/2YOY

Initial Full Year
Forecast

vs Full-Year
Forecast

Revenues

42,70549,699+16.4%

45,000110.4%

Gross Profit

12,166

19,863+63.3%

16,500120.4%

Operating Profit

8,189

15,417+88.3%

11,700131.8%

Recurring Profit

7,255

13,889+91.4%

10,250135.5%Net Income

6,761

12,925+91.2%

9,150

141.3%

EPS

13.58 yen

25.86 yen

+90.4%

18.3 yen

141.3%

ROE

13.0%

21.0%

+8.0%

15.3%

－

Dividend Per Share

1.3 yen

3.0 yen+130.8%2.0 yen150.0%

Fixed Revenues

7,613

10,890+43.0%－－

Fixed Expenses(SG&A+Interest Expense)

4,342

4,876

+12.3%

－

－

3,398

3,599

+5.9%

－

－

943

1,277

+35.4%－－

175.3%

223.3%+48.0%－－

SG&A
Interest Expense
Expense Coverage Ratio© 2016 Ichigo Inc. All rights reserved.

8

Revised Forecasts Up Twice
Upward Revisions in October 2015 and January 2016
Actual Results Exceeded Final Forecast
2016/02
Initial Forecast

Forecast Revisions
October 2015
January 2016

(Million Yen)
2016/02
ActualRevenues

45,00047,00049,00049,699Operating Profit

11,70014,00014,80015,417R
Recurringi Profit
P fi

10 2 0
10,25012 40012,40013 20013,20013 88913,889Net Income

9,150

11,00012,00012,925EPS

18.30 yen

22.01 yen

24.00 yen

25.86 yen

ROE

15.3%

18.1%

19.6%

21.0%

Dividend Per Share

2.0 yen

2.0 yen

3.0 yen

3.0 yen© 2016 Ichigo Inc. All rights reserved.

9

Segment P&L Breakdown‒ Asset Management OP 3.7X YOY‒ Value-Add OP 1.6X YOY‒ Clean Energy Revenues 2
2.7X
7X YOY(Million Yen)

Revenues
Segment

FY15/2

FY16/2

Operating Profit
Full-Year
Forecast

YOY

vs Full
Year
Forecast

FY15/2

FY16/2Full-Year
Forecast

YOY

vs Initial
Forecast

Earnings Drivers(YOY change is shown inparentheses)

Asset Management

3,967

5,067

+27.7%

4,713

107.5%

779

2,879+269.4%2,140

AM Fees: REIT:1,047(+288),
Private:54(-60)
134.5% Acquisition/Disposition Fees: 541 (+203)
Performance Fees: 685 (+668)
Sponsor Credit Support Fees: 410 (+410)

Value-Add

38,10742,944+12.7%

38,705111.0%

7,871

12,629+60.4%

9,579

131.8% Profits on Sale: 7,829 (+3,414)

Clean Energy

605

1,628

+168.9%1,581

103.0%

-93

323

－

198

162.9% Solar Electricity Sales: 683(+488)

Other

24

58

+136.0%

－

－

-66

-32

－

-85

Total

42,70549,699+16.4%

45,000110.4%

8,490

15,799+86.1%

11,833133.5%

－

－

－

－

－

－

-301

-382

－

-133

－

－

42 70542,70549 69949,699+16 4%+16.4%

45 00045,000110 4%
110.4%

8 189
8,189

15 417
15,417+88 3%+88.3%

11 70011,700131 8%
131.8%－

Adjustment (including
offsets of cross-segment
transactions)Total© 2016 Ichigo Inc. All rights reserved.

Rental Income: 8,054 (+2,289)－ Advisory Fees : 53(+27)

10Achieved All Shift Up 2016 KPI’s
Shift Up 2016 Mid-Term Business Plan (FY14/2 to FY16/2)

25 86 yen
25.86
enGross Profit
Operating Profit
Net Income

7X EPS
G
GrowththPlan

15,50015 417
15,417

13.58 yen
9.83 yen
7,400 7,435

4,974(million yen)

19,863

12,925
11,400

7,700

9,050

8,189

6,761
6,040

EPS

3.66 yen

11,50012,1663,900 3,912

4,000

4,526

1,844 1,637
1 637

ROE
Expensep
Coverage Ratio1

FY13/2

FY14/2

FY15/2

FY16/2

6.0%
129%

11.8%
141% (Plan 139%)

13.0% (Plan 11.8%)
175% (Plan 150%)

21.0% (Plan >15%)223% (Plan 165%)

1 Ratio of fixed revenues (such as annual AM fees and contractually-guaranteed rental income) over fixed expenses (fixed SG&A + interest expenses)‒ TSE First Section Listing on November 17, 2015
‒ Anticipate
A ti i t EEntering
t i JPX
JPX-Nikkei
Nikk i IIndex
d 400 ini August
A
t 2016© 2016 Ichigo Inc. All rights reserved.

11

Powerful Value-Add Business Model Underpins Growth© 2016 Ichigo Inc. All rights reserved.

12

Ichigo Hotel REIT (3463) Listing
Listed on November 30, 2015 with a Portfolio of Prime Location Hotels
Servicing Both Business Travelers and Tourists
 Strong operating start
start, backed by on-goingon going expansion of inbound tourism
 Generated Q3 profits of JPY 6B via Ichigo sale to REIT of value-added assets
 Started with 9 assets (JPY 20.4B), but plan to quickly grow portfolio to driveiincreasedd economies
i off scalel andd shareholder
h h ld valuel Ichigo as sponsor stands ready to acquire hotel assets and provide value-add
support to build a quality pipeline in scale- Acquired 16 hotel assets (JPY 30.8B) in FY 16/2, with an additional 7 assets (JPY 21.8B) in
highly-likely acquisition pipeline

Hotels Currently Being Asset Warehoused by Ichigo© 2016 Ichigo Inc. All rights reserved.

13

On-Going Ichigo Office REIT (8975) Growth
Ichigo Office REIT Converted from Multi-Asset Class REIT to aSpecialized Office REIT in September 2015
IIchigohi C
Co-PurchasedP hd 13 Mid-Size
Mid Si Office
Offi AssetsAt withith Ichigo
I hi Offi
Office REIT,
REIT
Granting Ichigo Office REIT Preferential Negotiation Rights*‒ Sale of 5 of these 13 assets to Ichigo Office REIT to be completed in May
2016
Assets with Preferential Negotiation Rights© 2016 Ichigo Inc. All rights reserved.

14

Value-Add as Earnings Driver
FY16/2 Value-Add Earnings of JPY 8.0B on Sales of 18 Assets
Acquired for JPY 31.4B
Weighted Average Increase in Value: +34.1%+34 1%
Average Holding Period: 19 months
FY16/2 Value-Add Sales – Breakdown by Holding Period
Average holding period:
19 months+34.1%
34.1%+20.5%Net Gain

+JPY
8 0B
8.0B

<1year1year
Average:
7 months

Acquisition
Price

JPY
12.0B

Net Gain+JPY 2.5B
Sales Price

JPY
14.5B
(7 assets)(7 assets)

Sales Price
AcquisitionPrice

JPY 31.4B+48.5%(18 assets)

JPY 23.4B(18 assets)t )≧1 yearAverage:
31 months© 2016 Ichigo Inc. All rights reserved.

Acquisition
q
Price

JPY
11.3B

Net Gain+JPY 5.5B
Sales Price

JPY
16.8B
(11 assets)(11 assets)15

Value-Add Case – Kyoto Hotel
Increased NOI via Strategic Value-Add CAPEX and Improved Operations; Sold
to Ichigo Hotel REIT at 3X the Acquisition Price (vs. 4.2X in NOI)
 Located on Kyoto Shijo
Shijo-dori,
dori, convenient to major tourist venues
 Rebranded and renovated all guestrooms and exterior (cost: 11% of
acquisition price) and changed operator
 No downtime during renovation
renovation, completed in June 2014; Have averaged
100% occupancy since renovation‒ Initial increase ADR forecast at acquisition +26%, actual +120%‒ Initial
I iti l iincrease iin NOI forecastft att acquisition
i iti 2X,
2X actual
t l4
4.2X
2X
 Well-positioned in an area than can generates both business and leisure(domestic and inbound) demand Entrance

Before© 2016 Ichigo Inc. All rights reserved.

 Guestrooms

After

BeforeAfter
16

Value-Add Case – Tokyo Retail
Win-Win Deep Value-Add Thanks to Strong Tenant Relationships
 Prime location retail (B1/3F) in Daikanyama (Shibuya) Rectified illegally extended exterior stairs and removed
inside stairs with tenant consent. Converted hallway andstairway to usable space, increasing total space and fixing
blocked lines-of-sightfwithin tenant spaces‒ 12% increase in leasable space‒ 25% increase in rent due to higher sales productivity
for tenants
BeforeConverted stairway andhall to usable space

3F

After
2F

1F

B1F

© 2016 Ichigo Inc. All rights reserved.

17

Capital-Efficient Asset Acquisitions
Synergies
S
i withith IIchigo
hi Offi
Office REIT andd IIchigo
hi H
Hotel
t l REIT S
Supportt
High ROE and Stable Earnings
FY16/2 Ichigo
g Groupp Acquisitions:q
55 assets, JPY 126.2B
Ichigo: 45 assets, JPY 85.6B; Ichigo Office REIT: 10 assets, JPY 40.5B
Ichigo-Owned Assets

Ichigo-Managed Assets

Ichigo(2337)

Ichigo Office REIT
(8975)

B/S 108 Assets,
JPY 184
184.7B
7B

Accelerated
Asset Turnover

Potential FY17/2 Sales

Equity Interest(JPY 2B) &Preferential
N
Negotiation
ti ti Right
Ri ht

Q1
4 assets JPY 5.7B
Q2
29 assets JPY 55.2B
Q3
2 assets JPY 3.8B
Q4
10 assets JPY 20.8B
T t l 45 assets
Total:t JPY 85
85.6B
6B

13 Offices JPY 29
29.2B
2B
Hotel Asset Pipeline

B/S 76 Assets, JPY 165.1B
Q1
Q2
Q3
Q4
Total:

12 assets JPY 44.0B——
1 asset JPY 1.7B——
13 assets JPY 45.7B

Ichigo Hotel REIT
(3463)
B/S 9 Assets JPY 20.4B
Q3
9 assets JPY 20.4B
Q4——
Total: 9 assets JPY 20.4B

Note: Ichigo-acquired assets sold to the REITs are recorded as Ichigo acquisitions (Ichigo Office REIT: 3 assets, JPY 5.2B; Ichigo Hotel
REIT: 9 assets, JPY 20.4B)© 2016 Ichigo Inc. All rights reserved.

18

National Solar Power Plant Portfolio (1)Serving Local Communities and the Environment
Total Operating and In-Development
Ichigo Solar Power Plants:

Ichigo Motomombetsu(1.40MW)

35 Plants (112MW)

Ichigo Engaru Kiyokawa(1.12MW)
Ichigo Yubetsu Barou(0.80MW)

Ichigo Abira Toasa(1.17MW)

Currently Operating

Ichigo Nakashibetsu
Midorigaoka(1.93MW)

Ichigo Muroran Hatchodaira(1.24MW)

26 Plants (45MW)
Ichigo Yamaguchi Aionishi(1.24MW)

Ichigo Engaru Higashimachi(1.24MW)

Ichigo Hamanaka Bokujo Tsurunokotai(2.31MW)

Ichigo Higashi-Hiroshima
Saijocho Taguchi (2.73MW)

Ichigo Betsukai Kawakamicho(0.88MW)

Ichigo Hamanaka Bokujo Kajibayashi(2.31MW) Online in 2016/10

Ichigo Akkeshi Shirahama(0.81MW)

Ichigo Sera Tsukuchi(2.54MW) Online in 2017/1

Ichigo Yamaguchi Sayama(2.36MW )Ichigo Sera Aomizu(2.75MW) Online in 2017/2

Ichigo Toyokoro
Sasadamachi (0.61MW)

I hi M
IchigoMaebashib hi N
Naegashimahi(0.67MW)
Ichigo Fuchu Jogecho Yano
(0.99MW)

Ichigo Nago Futami(8.44MW)

Ichigo Toyokoro(1.03MW)

Ichigo Minakami Aramaki(10.26MW) Online in 2018/7
Ichigo Showamura Ogose(43.01MW) Online in 2018/1

Ichigo Yonago Izumi(2.61MW)

Ichigo Kiryu Okuzawa(1.33MW)

Ichigo Kasaoka Takumicho(1.12MW)

Ichigo Toride Shimotakai Kita
(1.03MW) Online in 2016/7
Ichigo Toride Shimotakai Minami(0.54MW) Online in 2016/7
Ichigo Miyakonojo
Yasuhisacho (1.44MW)

Ichigo Toki Oroshicho(1.40MW) Online in 2016/6

Ichigo Tokushima
Higashi-Okinosu (2.52MW)
Ichigo Kure Yasuuracho Nakahata(2.65MW) Online in 2017/8© 2016 Ichigo Inc. All rights reserved.

Ichigo Takamatsu
Kokubunjicho Nii (2.43MW)

Ichigo Toyokawa Mitocho Sawakihama(1.80MW)

IIchigohi IIyo Nakayamacho
N kh
Izubuchi (1.23MW)

As of April 19, 201619

National Solar Power Plant Portfolio (2)Feed-In Tariff
40 yen：20 Plants, 34MW
36 yen：9 Plants, 68MW
32 yen：6 Plants, 10MW

Hokkaido
12.2MW

Tohoku4.6MW

In-Op
peration

Okinawa
8.4MW(7.5MW)

In-D
Development + In-O
Operation

Chugoku
18.9MW(2.3MW)

Tokyo
56.8MW

KyushuKh
1.4MW

Shikoku
6.1MW

Chubu
3.2MW
(2.0MW)(1.8MW)

As of April 19, 2016
© 2016 Ichigo Inc. All rights reserved.

20

National Solar Power Plant Portfolio (3)By Customer (as of Apr 19, 2016)

By Feed-in-Tariff (as of Apr 19, 2016)

Chubu Kyushu
1%
Tohoku3%
4%

Hokkaido
11%

To start
operationin >2 years
9%

32 yen9%

Shikoku
5%
Okinawa
8%

40 yen
30%
Tokyo
51%

By Operating Timeline (as of Feb 29, 2016)>1 year inoperation
26%

To start
operation
within 12 years
41%

36 yen61%

Chugoku17%

To start
operation
within 0.51 year
7%

0.5 year inoperation
8%

0.5 - 1 year
inoperation
4%

To start
operation
within 0.5
year5%

By Solar Intensity (as of Feb 29, 2016)

By Output (as of Feb 29, 2016)
A
B
C(In13%(InDevelopment)
Development)
7%
5%

<2MW
20%

B
24%

A
(InDevelopment)
50%

>10MW
(InDevelopment)
47%

>2MW,
<10MW
19%

Solar Intensity>4.00>3.75, <4.00>3.50, <3.75<3.50

Unit: (kWh/m2 per day)C
1%
>2MW, <10MW(In(InDevelopment)
11%© 2016 Ichigo Inc. All rights reserved.

Rank
A
B
C
D

<2MW
((InDevelopment)
3%21

Strong Financial Position
W i ht d A
Weighted
Average IInteresttt RateR t andd Average
A
Loan
L
P
Periodi d

W i ht d A
Weighted
Average IInteresttt RateR t(Interest Rate)

Average Loan Period

3.0%

2 56%
2.56%

(Loan Period, Year)

11.0

9.0 years

2.5%

9.0
8.7 years

2.22%
1 96%
1.96%
2.0%

7.0

5.9 years

1.71%

4.7 yyears

1 5%
1.5%

1.41%

50
5.0

3.6 years

1.0%

Long/Short-Term
Loan Ratio

3.0
FY12/2

FY13/2

FY14/2

FY15/2

FY16/221% (JPY 1.9B)

21% (JPY 1.5B)

14% (JPY 4.1B)

8% (JPY 4.9B)

10% (JPY 10.3B)

79%(JPY 7.4B)
7 4B)

79%
(JPY 5.5B)
5 5B)

86%
(JPY 26.1B)
26 1B)

92%((JPY 53.4B))

90%((JPY 94.4B))

Short-Term
Long-Term

Megabank Loan Ratio
Non-Megabank
g

100%

100%

66.1%

74 7%
74.7%

33.9%

25.3%

Megabank© 2016 Ichigo Inc. All rights reserved.

49.1%

63.7%

50.9%

36.3%

38.4%
61.6%
22

New MTP Power Up 2019

© 2016 Ichigo Inc. All rights reserved.

23

Power Up 2019 Key Goals & KPIs
Key Goals
1. Drive Further Sustainable Growth in Ichigo’s Core Businesses
2 Develop
2.
D
l New
N
I hi Businesses
IchigoB i
3. Deepen Ichigo’s Core Capabilities and Corporate Strength

Power Up 2019 KPIs (Key Performance Indicators)(Million Yen)

FY16/2 (Actual)

FY17/2 (Forecast)

Operating Profit

15,41718,50025,000+62.2%

g Profit
Recurring

13,88916,40021,400,+54.1%

6.9%

27.8%

30.0%

－

12,925

13,30014,800+14.5%

EPS

25.86 yen

26.43 yen

29.00 yen

+12.1%

DPS

3.00 yen

5.00 yen

7.00 yen+133.0%

ROE

21.0%

18.1%

15.6%

Tax Rate
Net Income© 2016 Ichigo Inc. All rights reserved.

FY19/2 (Plan)

vs FY16/2－

24

Power Up 2019 KPIs (2)Power Up 2019: February 2017 – February 2019
Operating Profit
Net Income(million yen)

29.00 yen

EPS
S
25.86 yen

1.6X OP in
3Y
Years

25,00015,417

14,80012,925

FY16/2 (Actual)

Capital Efficiency© 2016 Ichigo Inc. All rights reserved.

FY19/2

ROE:>15%

Dividend

DOE: >3%25

Power Up 2019 JPX-Nikkei 400 Top 200 Ranking
Additional Target: JPX-Nikkei 400 Top 200 Ranking by August 2019
 Anticipatepentering
g JPX-Nikkei 400 this Augustg By August 2019, the final year of Power Up 2019, Ichigo will seek to rank
within the JPX-Nikkei 400’s top 200 companies

Note: While the JPX-Nikkei 400 does not provide an official ranking of its 400 constituents, the ranking
can be objectively calculated based upon the JPY-Nikkei
JPY Nikkei 400’s
400 s publically-available
publically available quantitative ranking
formula, which rank orders the joint set of the 1,200 highest market capitalization and 1,200 highest
value-traded Japanese companies by:(a) 3-year average ROE (40% weighting)(b) 3
3-yearyear cumulative operating profit (40% weighting)(c) Market capitalization (20% weighting)© 2016 Ichigo Inc. All rights reserved.

26

Power Up 2019 Key Initiatives
Profitability• List Ichigo’s
Ichigo s solar assets on the TSE’s
TSE s newInfrastructure Fund Market• Support the on-going growth of Ichigo Office
REIT (8975) and Ichigo Hotel REIT (3463)(1) Core BusinessG
Growthth• Expand the architecture and structural
engineeringii tteam tto deliverd lireall estatet t ththatt isihigh-function, safe, secure, andenvironmentally friendly• Spin out a dedicated leasing team to drive
tenant acquisition and rental income• Extend Ichigo’s REIT-focused asset
management business into the much larger
physical real estate market(2) New Business
Creation

Sustainability• Grow both financial stability and earnings(3) Finance as aStrategic Weapon(4) High Capital
Efficiency andOrganic Growth(5) Best Place toWork• De-collateralize loans, lengthen loan
maturities, lower debt costs, get credit
ratings, and issue bonds to diversify funding
profile• ROE >15%

• Support employee health and wellness• Goal: Japan’s number one company inprovidingp
g opportunitiespp
for employeesp y• Grow Ichigo’s hotel business synergisticallywith Ichigo Hotel REIT
• Launch one or more REtech businesses,
fusing Ichigo’s Real Estate and IT
capabilities© 2016 Ichigo Inc. All rights reserved.

(6) Global Best Practice Governance and Compliance27Adoption of Progressive Dividend Policy
 Progressive Dividend: Previous year’s dividend is the floor for the current
year’s dividend. Dividend will be raised (or kept flat) but not cut, providing
shareholders with downside dividend protection
 Newly setting minimum DOE (dividend on equity) payout ratio of >3 %‒ Dividend payout ratio policy: Dividends based on annual earnings  Morevolatilel til‒ DOE policy: Dividends based on shareholder equity  More Stable
progressivegdividend and DOE-based p
payoutyppolicyy will Combination of psignificantly increase the security, certainty, and visibility of the dividend to thebenefit of Ichigo’s shareholders
 Also underscores Ichigo’sgcommitment to driving
g continued organicgearningsgand dividend growth for its shareholders© 2016 Ichigo Inc. All rights reserved.

28

Powerful Value-Add Business Model
Significant Value-Add and Asset Management Business Synergies
Value-Add
Value
Add Business Model
Renewable Energy

Solar Plants
Buy

Infrastructure
Fund(Preparing for Listing)

OfficeIchigo Office REIT
(8975)
Hotel

Ichigo Hotel REIT
(3463)© 2016 Ichigo Inc. All rights reserved.

Sell

Real
不動産
EstateValueAdd

Real
EstatePreserve &Improve

Sell

ThirdParty
I
Investors
t

Buy
29

FY17/2 Full-Year Forecast
Operating Profit +20.0% and Recurring Profit +18.1% VS FY16/2
Net Income +2.9% Due to Increased Tax Burden(Million Yen)

FY17/2(Forecast)

FY16/2(Actual)vs FY16/2(Forecast)

Revenues

125,600

49,699+152.7%

Operating Profit

18,50015,417+20.0%

Recurring Profit

16,40013,889+18.1%Net Income

13,30012,925+2.9%

EPS

26.43 yen

25.86 yen

+2.2%

ROE

18.1%

21.0%

－

Dividend Per Share

5.0 yen

3.0 yen+66.7%© 2016 Ichigo Inc. All rights reserved.

30

FY17/2 Full-Year Forecast Details(Million Yen)
Segment Profit (Operating Profit)

Revenues
FY17/2(Forecast)

FY16/2(Actual)vs Forecast

FY17/2(Forecast)

FY16/2(Actual)vs Forecast

5,079
5,0
9

5,067
5,06

+0.2%
0 %

2,386
,386

2,879
,8 9

-17.1%%

Value-Add

109,297

42,944+154.5%

13,53012,629+7.1%

Clean Energy

11,152

1,628+584.7%

2,608

323

+705.0%

Other
Ot
e

71

58

+21.0%
0%

-84
8

-32
3

－

Total

125,600

49,699+152.7%18,44015,799+16.7%

-

-

-

59

-382

－

125,600

49,699+152.7%18,50015,417+20.0%

Asset
sset Managementa age e t

Adjustment (including offsets of crosscrosssegment transactions)Total© 2016 Ichigo Inc. All rights reserved.

31

Appendix: Financial & Real Estate Data

© 2016 Ichigo Inc. All rights reserved.

32

Value-Add Social SignificanceEnd Demolish and Rebuild and Embrace Value-Add‒ Preserve and enhance high-function real estate‒ SustainableS t i bl R
Reall E
Estatet t serving
i a SustainableS t i bl S
Societyi tValue‐Add
DemolishandRebuild© 2016 Ichigo Inc. All rights reserved.

Effective
Re-Use of
Key Social
Infrastructure

・Preserve & Improve・Higher-Quality Tenant Services
・Higher Functionality (Security, A/C)・Upgrade Exteriors/Interior Spaces

Highesty
Efficiency
LowestImpact33

Value-Add Sample Earnings Model
5.5% NOI, JPY 2B purchase, LTV 70%, 1.5% interest rate, JPY 50M
capex, 20% increase in NOI, 3-year value-add period

At Acquisition NOI(JPY 110M NOI/year) － (JPY 21M interest/year) ＝ JPY 89M NOI/yearNOI÷ Initial Investment ＝14.8% NOI return during investment period
.

D bt
Debt
Asset

JPY1.4B.

JPY 2B
EquityJPY 0.6B
JPY 50Mof capex

After Value-Add NOI(JPY 132M NOI/year) － (JPY 21M interest/year) ＝ JPY 111M NOI/year
NOI ÷ Total Investment (JPY 600M + JPY 50M) ＝17.1% NOI return during
investment period

3-year value-add© 2016 Ichigo Inc. All rights reserved.

Value-Add for Capital Gain
V l Add toValue-Addt increasei
NOI 20% att equivalenti l t cap ratet increasesi
exitit priceiby 20%: JPY 2B * 120% = JPY 2.4B
JPY 2.4B – (JPY 2B + JPY 50M) = JPY 350M capital gain.

ResultJPY 650M investment generates JPY 617M over 3 years → 31.6% p.a.

34

Consolidated Risk-Based Balance Sheet
Consolidated Current Value Balance Sheet
Total: JPY 279.9B(Total Assets: JPY 251.7B + Unrealized Gains JPY 28.1B

Non-Recourse LoanRelated Assets

Non-Recourse Loans &Related Liabilities

JPY 66.2B

JPY 84.2B

Consolidated Risk-Based Balance Sheet
Total Assets JPY 185.5B
Non-Recourse LoanRelated IGH Equity
JPY 18.0B
Cash & Cash Equivalents

Cash & Cash Equivalents

JPY 22.2B

Operational Investments in Loans
JPY 1.3B

Operationalp
Investments in
S
Securities
JPY 1.7B
1

Corporate Loans

JPY 104.7B

Debt
JPY
184.2B

Real Estate For Sale

JPY 29.7B
Investments in Securities
JPY 5.4B

JPY 104.7B

JPY 97
97.5B
5B
Security Deposits Received
JPY 5.0B

Security Deposits Received
JPY 5.0B

Other JPY 8.2B

Other JPY 8.2B

Shareholder
EquityJPY 67.4B

Other JPY 9.3B

Unrealized Gains
JPY 28.1B

Corporate Loans

Debt
JPY
118 0B
118.0B

Real Estate For Sale

JPY 97
97.5B
5B

Fixed Assets

JPY 22.2B

Operational Investments in Loans
JPY 1.3B
Operational Investments in
Securities JPY 1.7B

Unrealized Gains
JPY 28.1B

Shareholder
Equity Ratio

34.2%

Fixed Assets

JPY 29.7B
Investments in Securities
JPY 5.4B

Shareholder
EquityJPY 67.4B

Other JPY 9.3B

Unrealized Gains
JPY 28.1B

Unrealized Gains
JPY 28.1B

Risk-Based
Shareholder
Equity Ratio
with
Unrealized Gains

44.8%

Note: Risk-based balance sheet includes unrealized gains/losses and excludes client and non-recourse assets and liabilities© 2016 Ichigo Inc. All rights reserved.

35

Significant Unrealized Gains on Balance Sheet
Total Unrealized Gains: JPY 28.0B (Appraisal Value Basis)
Real estate directly held by Ichigo(Million Yen)
LocationBook Value as ofFebruary 2016NOI

Cap Rate
NOI/Book Value after w rite-dow n

Appraisal Valueas of February 2016

Unrealized GainTokyo

88,288

4,948

5.7%

102,862+14,574

Outside Tokyo

92,499

5,913

6.6%

105,630+13,131

180,786

10,861

6.1%

208,492+27,706

Total

Note: Excludes development assets (c. JPY 371M) which are not currently generating NOI and
includes intangible fixed assets subject to appraisal (c. JPY 62M)

Real estate held by Ichigo within Ichigo-managed funds (SPCs) where there are other non-Ichigo equity holders(Million Yen)

Book Valueas of February 2016

Appraisal Valueas of February 2016

Equity Investments(Non-consolidated)

1

1

0

Equity Investments(Consolidated)

926

1,276

+350

Total

927

1,277

+350

© 2016 Ichigo Inc. All rights reserved.

Unrealized Gain

36

Business Segments

Asset Management

Asset Management generates fee income via managing the Tokyo
Stock Exchange-listed J-REITS (Ichigo Office REIT and Ichigo Hotel
REIT) and private funds and providing real estate services related toreal estate acquisition, operation (PM/BM), and disposition.

Value-Add

Value-Add preserves and improves real estate. Ichigo receives rental
income during the period in which it is carrying out its value-add,
along with profits on sale that reflect the real estate’s higher value
after the value-add is complete.

Clean Energy

Clean Energy generates long-term income primarily via utility-scalesolar power production that produces clean energy and brings
productive use to idle land.

Other

Other is primarily legacy securities investments that are not related tothe above three segments.

© 2016 Ichigo Inc. All rights reserved.

37

Consolidated Balance Sheet(Million Yen)FY 16/2
FY15/2

OutsideInvestors'
Interest

B/S

YOY

Market Value

Unrealized
Gain on Listed
Securities 2

Unrealized
Gain

Cash and Cash Equivalents

19,383

28,779897+9,396

28,779-Operating Loans Receivable (Value-Add)

2,330

1,324

-

-1,006

1,324-

Operational Investments in Securities

1,965

1,784

-

-181

1,784

-

638

844

-

+206

844

-

1,327

939

-

-388

939

-

Real Estate for Sale (Value-Add)

109,769

172,833

5,377+63,064

200,120+26,433

Fixed Assets

26 321
26,32131 546
31,546-+5 225+5,22533 29333,293+1 746+1,746

42

39

-

-3

42

+2

Value-Add

16,073

15,897--176

17,640+1,743

Clean Energy

10,152

15,560-+5,40815,560

-

52

48

-

-4

48

-

Intangible Assets

2,502

2,373

-

-129

2,373

-

Investments in Securities

5,266

5,486

-

+220

5,486

-

Other

5 204
5,204

7 628
7,628

15

+2 424+2,424

7 628
7,628

-

172,744251,757

6,290+79,013

280,791+28,180

Value-Add
Other

Asset Management

Other 1

Total Assets

+2

+2

+278

+281

1 Other refers to company assets that are not allocated to or cannot be allocated to above segments
2 Unrealized Gain on Listed Securities is recorded in Unrealized Gain on Operational Investment in Securities and in Intangible Assets© 2016 Ichigo Inc. All rights reserved.

38

Consolidated Balance Sheet: Segment Breakdown(Million Yen)
SegmentgCash and
Cash
Cas
Equivalents

Operating
Loans
oa s
Receivable

Operational
est e ts
Investments
in Securities

Real Estatef Sale
for
S l

Fixed
ed Assets
ssets

Intangible
A
Assetst

Investments
iin S
Securities
iti

Other
Ot
e Assets
ssets

Total
ota Assets
ssets

476

-

-

-

39

1,634

-

466

2,617

Value-Add

12,723

1,324

844

172,833

15,897

175

-

3,254

207,053

Clean Energy

1,049

-

-

-

15,560

532

-

988

18,131Other*
Other

14 53014,530

-

939

-

48

31

5 486
5,486

2 918
2,918

23 95423,954

Total

28,779

1,324

1,784

172,833

31,546

2,373

5,486

7,628

251,757

Asset Management* Includes company assets that are not allocated to above segments© 2016 Ichigo Inc. All rights reserved.

39

Consolidated P&L: Gross Profit Segment Breakdown(Million Yen)
Revenues
FY15/2Gross Profit

FY16/2

ChangeFY15/2

FY16/2

ChangeYOY(Gross Profit)

3,967

5,067

+1,099

1,786

3,281

+1,494+83.6%

Asset Management Fees

1,312

1,670

+357

1,224

1,658

+434

+35.5%

PM/BM Fees

2 503
2,503

2 201
2,201

-302
302

430

492

+62

+14 6%+14.6%

151

1,195+1,043

132

1,129

+996

+751.4%

38,10742,944+4,837

10,17915,877+5,697+56.0%

Rental Income

9,208

12,459+3,250

5,764

8,054

+2,289+39.7%

Real Estate Sales

28,89930,485+1,586

4,414

7,829

+3,414+77.4%

-

-

-

-

-6

-6

-%

Clean Energy

605

1,628

+1,022

194

683

+488

+251.1%

Other

24

58

+33

6

21

+15

+254.3%Advisoryy Fees

26

53

+27

26

53

+27

+105.2%

Securities Sales

-1

5

+6

-1

4

+6

-%

Other

0

0

0

-18

-36

-18

-%

42 70542,70549 69949,699+6 993+6,99312 166
12,16619 863
19,863+7 696+7,696+63 3%+63.3%

Asset Management

Other
Value-Add

Other

Total

© 2016 Ichigo Inc. All rights reserved.

40

Consolidated P&L: Results vs. Initial & Final Forecasts(Million Yen)
FY16/2 (12M)
Revenues

vs Full-Year
Forecast

Operating
ProfitRevenues

5,067

107.5%

3,281

114.8%

2,879

134.5%

4,713

2,857

2,140

5,037

3,284

2,788

Asset Management Fees

1,670

102.9%

1,658

103.3%

―

―

1,623

1,606

―

1,670

1,658

―

PM/BM Fees

2 201
2,201

91 8%
91.8%

492

88 1%
88.1%

―

―

2 397
2,397

559

―

2 172
2,172

488

―

Other

1,195

172.7%

1,129

163.2%

―

―

692

692

―

1,195

1,136

―

Value-Add

42,944111.0%

15,877121.6%

12,629131.8%

38,705

13,052

9,579

42,26815,552

12,164

Rental Income

12,459106.3%

8,054

107.4%――

11,725

7,503―

11,809

7,753―

Real Estate Sales

30,485113.0%

7,829

141.1%――

26,9805,549―

30,459

7,799

―

―

―

-6

―

―

―

―

―

―

0

-0

―

1,628

103.0%

683

116.0%

323

163.1%

1,581

589

198

1,641

678

280

58

―

21

―

-32
32

―

―

―

-85
85

51

-8
8

-84
84

Advisory Fees

53

―

53

―

―

―

―

―

―

48

48

―

Securities Sales

5

―

4

―

―

―

―

―

―

2

2

―

Other

0

―

-36

―

―

―

―

―

―

0

-59

―

49,699110.4%

19,863120.4%

15,799133.5%

45,00016,50011,83349,00019,507

15,148

―

―

―

―

-382

―

―

―

-133

―

―

-348

49,699110.4%

19,863120.4%

15,417131.8%

45,00016,50011,70049,00019,507

14,800Asset Management

Other
Clean Energy
Other

Total
Adjustm ent (including
offsets of cross-segm ent
transactions)Total© 2016 Ichigo Inc. All rights reserved.

Gross
ProfitFY16/2 Full-Year Forecast (12M)

vs Full-Year Operating vs Full-Year
Forecast
ProfitForecast

Revenues

Gross
ProfitFull-Year Earnings Forecast
Revision (Jan. 2016)
Gross
ProfitOperating
Profit41

Asset Management AUM Detail

Ichigo Office REIT
(8975)AUM (Fiscal Year End)AM Fee % (Average)
AM Fee Gross Profit (Actual)

Ichigo Hotel REIT
(3463)

Private Equity Real
Estate Funds(excluding
consolidated)

Total

FY12/2(12M)

FY13/2(12M)

FY14/2(12M)

FY15/2(12M)

FY16/2(12M)

JPY 106B

JPY 104B

JPY 121B

JPY 124B

JPY 165B

0.61%

0.63%

0.65%

0.65%

0.64%

JPY 719M

JPY 663M

JPY 733M

JPY 759M

JPY 1,016M

AUM (Fiscal Year End)

―

―

―

―

JPY 20B

AM Fee % (Average)

―

―

―

―

0.59%

AM Fee Gross Profit (Actual)

―

―

―

―

JPY 30M

JPY 213B

JPY 170B

JPY 63B

JPY 22B

JPY 15B

0.15%

0.15%

0.26%

0.37%

0.32%

AM Fee Gross Profit (Actual)

JPY 284M

JPY 285M

JPY 257M

JPY 114M

JPY 60M

AUM (Fiscal Year End)JPY 319B

JPY 274B

JPY 184B

JPY 145B

JPY 201B

0.33%

0.33%

0.47%

0.59%

0.61%

JPY 1,004M

JPY 948M

JPY 989M

JPY 872M

JPY 1,106M

AUM (Fiscal Year End)AM Fee % (Average)

AM Fee % (Average)
AM Fee Gross Profit (Actual)

Note: Ichigo
g Hotel REIT AM % and Gross Profit are annualized.

© 2016 Ichigo Inc. All rights reserved.

42

Ichigo-Owned Real Estate Portfolio
Assets by Location

Assets by TypeAs of February 29, 2016

Ground Lease Other3%
2%

Sendai
2%

Mixed
6%

(Billion Yen)

Other
11%

Nagoya7%

Residence
12%

Of f ice
41%

Hotel
16%
Retail
20%

Tokyo
49%

Kanto
9%
Osaka
10%
Fukuoka
12%

Sendai
48
4.8

Tokyo

90.7

Assets by Size
JPY5-10B
13%

JPY 510B
14%

JPY 0-1B
13%

JPY 1-5B
74%

Osaka
18.3
Fukuoka
21.8

Nagoya
12 8
12.8

Kanto
16.1

Other
19.9

Total Assets: JPY 184.7B
Including Ichigo-Managed AUM: JPY 392.1B(Acquisition price basis)© 2016 Ichigo Inc. All rights reserved.

43

Value-Add Full Asset Breakdown (1)108 Assets, Book Value JPY 184.7B, Forecast NOI JPY 10.9B (6.0%)
N
No.

A
Asset
t ClassClA
Assett TypeT

L
Locationti

Building
g
AgeA
Acquisition
i iti P
Pricei

Acquiredq
Date

Expectedp
NOI/Year

Ichigog
Investment

Forecast Equity
q yMultiple1

Forecast
IRR2

1

Other

Fixed Asset

Matsudo City, Chiba

43 years

JPY 2B-3B

2005/06

JPY 230M

JPY 1,900M

―

―

2

RetailReal Estate for Sale

Minato-ku, Tokyo46 years

JPY 2B-3B

2005/10

JPY 131M

JPY 1,033M

―

―

3

RetailReal Estate for Sale

Minato-ku, Tokyo

30 years>JPY 3B

2006/03

JPY 167M

JPY 1,356M

―

―

4

RetailReal Estate for Sale

Yokohama City, Kanagawa

11 years

JPY 1B-2B

2006/09

JPY 57M

JPY 1,157M

―

―

5

OfficeReal Estate for Sale

Sendai City, Miyagi

7 years>JPY 3B

2006/10

JPY 265M

JPY 1,042M

―

―

6

OfficeReal Estate for Sale

Fukuoka City, Fukuoka

7 years>JPY 3B

2006/12JPY 389M

JPY 1,339M

―

―

7

Other

Fixed Asset

Isumi City, Chiba

JPY 1B-2B

2007/02―

JPY 1,055M

―

―

8

RetailReal Estate for Sale

Fukuoka City, Fukuoka

6 years>JPY 3B

2007/03

JPY 208M

JPY 792M――

9

Residence

Real Estate for Sale

Ota-ku, Tokyo

11 years<JPY 1B

2007/04

JPY 57M

JPY 403M――

10

RetailReal Estate for Sale

Chiyoda-ku, Tokyo

36 years<JPY 1B

2007/06

JPY 85M

JPY 240M――

11

RetailReal Estate for Sale

Chiyoda-ku, Tokyo

34 years<JPY 1B

2007/06

JPY 119M

JPY 233M――

12

RetailReal Estate for Sale

Chiyoda-ku, Tokyo

52 years

JPY 2B-3B

2007/06

JPY 249M

JPY 554M――

13

OfficeReal Estate for Sale

Minato-ku, Tokyo

42 years>JPY 3B

2007/11

JPY 304M

JPY 2,049M

―

―

14

Ground Lease

Real Estate for Sale

Atsugi City, Kanagawa

JPY 1B-2B

2011/06

JPY 176M

JPY 147M――

15

Mixed (Office/Retail)Real Estate for Sale

Hiratsuka City, Kanagawa<JPY 1B

2012/02

JPY 83M

JPY 172M

―

―

1
2

―

―
20 years

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

44

Value-Add Full Asset Breakdown (2)NoNo.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1*

Forecast
IRR2

16

RetailReal Estate for Sale

Yokohama City, Kanagawa

2 years<JPY 1B

2012/10

JPY 32M

JPY 171M――

17

RetailFixed AssetToshima-ku, Tokyo

4 years>JPY 3B

2013/03

JPY 228M

JPY 340M――

18

RetailReal Estate for Sale

Shibuya-ku, Tokyo

29 years<JPY 1B

2013/05

JPY 45M

JPY 154M――

19

Mixed (Office/Retail)Real Estate for Sale

Chofu City, Tokyo

30 years

JPY 1B-2B

2013/06

JPY 112M

JPY 310M――

20

Residence

Real Estate for Sale

Kita-ku, Tokyo

27 years<JPY 1B

2013/06

JPY 2MJPY 31M――

21

Residence

Real Estate for Sale

Minato-ku, Tokyo

0 years<JPY 1B

2013/06

JPY 42M

JPY 203M――

22

Residence

Real Estate for Sale

Osaka City, Osaka

13 years<JPY 1B

2013/07

JPY 32M

JPY 81M――

23

Residence

Real Estate for Sale

Osaka City, Osaka

9 years<JPY 1B

2013/08

JPY 49M

JPY 81M――

24

OfficeReal Estate for Sale

Chiyoda-ku, Tokyo

25 years

JPY 1B-2B

2013/08

JPY 86M

JPY 520M――

25

Residence

Real Estate for Sale

Osaka City, Osaka

10 years<JPY 1B

2013/08

JPY 37M

JPY 90M――

26

RetailFixed Asset

Kobe City, Hyogo

15 years

JPY 1B-2B

2013/09

JPY 145M

JPY 616M――

27

RetailFixed Asset

Tokorozawa City, Saitama

8 years

JPY 1B-2B

2013/11

JPY 64M

JPY 92M――

28

Ground Lease

Real Estate for Sale

Chiba City, Chiba-

JPY 2B-3B

2014/02

JPY 128M

JPY 342M――

29

Ground Lease

Real Estate for Sale

Fujisawa City, Kanagawa-

JPY 1B-2B

2014/03

JPY 115M

JPY 273M

7.52 x44.5%30

Mixed (Office/Retail)Real Estate for Sale

Shibuya-ku, Tokyo<JPY 1B

2014/03

JPY 39M

JPY 108M

6.95 x26.0%

1
2

32 years

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

45

Value-Add Full Asset Breakdown (3)NoNo.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

31

OfficeReal Estate for Sale

Shibuya-ku, Tokyo

5 years

JPY 1B-2B

2014/04

JPY 60M

JPY 1,090M

1.25 x12.0%

32

RetailFixed Asset

Fukuoka City, Fukuoka

9 years

JPY 1B-2B

2014/04

JPY 59M

JPY 279M――

33

OfficeReal Estate for Sale

Shinagawa-ku, Tokyo

27 years

JPY 2B-3B

2014/05

JPY 155M

JPY 530M

2.04 x20.0%

34

OfficeReal Estate for Sale

Shinagawa-ku, Tokyo

22 years

JPY 1B-2B

2014/05

JPY 131M

JPY 515M

2.27 x23.4%

35

Mixed (Office/Retail)Real Estate for Sale

Minato-ku, Tokyo

7 years

JPY 2B-3B

2014/05

JPY 155M

JPY 434M

3.08 x15.2%

36

Residence

Real Estate for Sale

Kumamoto City, Kumamoto

9 years>JPY 3B

2014/06

JPY 213M

JPY 476M

3.52 x19.0%

37RetailReal Estate for Sale

Minato-ku, Tokyo

44 years<JPY 1B

2014/07

JPY 39M

JPY 77M

10.47 x23.9%

38

Mixed (Office/Retail)Real Estate for Sale

Shinjuku-ku, Tokyo

40 years>JPY 3B

2014/07

JPY 201M

JPY 645M

3.32 x21.1%

39

RetailFixed Asset

Fukuoka City, Fukuoka

11 years<JPY 1B

2014/07

JPY 47M

JPY 213M――

40

RetailFixed Asset

Fukuoka City, Fukuoka

30 years<JPY 1B

2014/09

JPY 55M

JPY 252M

―

―

41

Hotel

Real Estate for Sale

Utsunomiya City, Tochigi

28 years

JPY 1B-2B

2014/09

JPY 138M

JPY 400M

1.97 x28.3%

42RetailReal Estate for Sale

Fukuoka City, Fukuoka

15 years<JPY 1B

2014/09

JPY 54M

JPY 177M

5.54 x26.2%

43RetailReal Estate for Sale

Osaka City, Osaka

13 years

JPY 1B-2B

2014/09

JPY 90M

JPY 301M

4.64 x24.3%

44RetailReal Estate for Sale

Machida City, Tokyo

29 years<JPY 1B

2014/10

JPY 51M

JPY 82M

11.34 x43.9%

45RetailReal Estate for Sale

Fukuoka City, Fukuoka

13 years

JPY 1B-2B

2014/11

JPY 68M

JPY 135M

10.70 x

33.8%

1
2

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

46

Value-Add Full Asset Breakdown (4)No
No.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

46

Residence

Real Estate for Sale

Chiyoda-ku, Tokyo

12 years

JPY 2B-3B

2014/12JPY 119M

JPY 332M

2.18 x29.2%

47

Residence

Real Estate for Sale

Koto-ku, Tokyo

9 years

JPY 1B-2B

2014/12JPY 96M

JPY 270M

1.56 x14.6%

48

Residence

Real Estate for Sale

Minato-ku, Tokyo

12 years

JPY 1B-2B

2014/12JPY 79M

JPY 238M

1.67 x16.6%

49

Residence

Real Estate for Sale

Minato-ku, Tokyo

11 years

JPY 1B-2B

2014/12JPY 61M

JPY 185M

1.63 x15.7%

50

Residence

Real Estate for Sale

Sumida-ku, Tokyo

10 years

JPY 1B-2B

2014/12JPY 59M

JPY 163M

1.55 x15.2%

51

Residence

Real Estate for Sale

Ota-ku, Tokyo

14 years<JPY 1B

2014/12JPY 60M

JPY 150M

2.21 x35.7%

52

Residence

Real Estate for Sale

Osaka City, Osaka

8 years<JPY 1B

2014/12JPY 58M

JPY 148M

1.86 x24.8%

53

Residence

Real Estate for Sale

Chuo-ku, Tokyo

12 years<JPY 1B

2014/12JPY 38M

JPY 99M

2.96 x44.4%

54

Residence

Real Estate for Sale

Minato-ku, Tokyo

11 years<JPY 1B

2014/12JPY 38M

JPY 123M

1.97 x23.3%

55

Residence

Real Estate for Sale

Shinjuku-ku, Tokyo

11 years<JPY 1B

2014/12JPY 29M

JPY 82M

2.05 x25.8%

56

Residence

Real Estate for Sale

Shibuya-ku, Tokyo

10 years

JPY 1B-2B

2014/12JPY 87M

JPY 270M

2.00 x23.2%

57

Residence

Real Estate for Sale

Minato-ku, Tokyo

12 years

JPY 1B-2B

2014/12JPY 57M

JPY 186M

1.90 x21.0%

58

Residence

Real Estate for Sale

Shibuya-ku, Tokyo

11 years<JPY 1B

2014/12

JPY 49M

JPY 157M

1.89 x21.5%

59

Residence

Real Estate for Sale

Setagaya-ku, Tokyo

11 years<JPY 1B

2014/12JPY 39M

JPY 117M

2.11 x27.2%

60

Residence

Real Estate for Sale

Shinjuku-ku, Tokyo

9 years<JPY 1B

2014/12JPY 19M

JPY 55M

1.80 x21.1%

12

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

47

Value-Add Full Asset Breakdown (5)Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/YearShinjuku-ku, Tokyo

52 years

JPY 1B-2B

2014/12JPY 103M

JPY 57M

15.26 x51.7%

Fixed Asset

Fukuoka City, Fukuoka

12 years<JPY 1B

2014/12

JPY 42M

JPY 212M――

RetailReal Estate for Sale

Meguro-ku, Tokyo

9 years

JPY 1B-2B

2014/12JPY 67M

JPY 129M

3.98 x23.8%

64RetailReal Estate for Sale

Shinagawa-ku, Tokyo

61 years<JPY 1B

2015/01

JPY 16M

JPY 0M――

65

OfficeReal Estate for Sale

Fujisawa City, Kanagawa

25 years

JPY 1B-2B

2015/01

JPY 69M

JPY 375M

1.41 x41.9%

66

RetailReal Estate for Sale

Sendai City, Miyagi

12 years<JPY 1B

2015/02

JPY 47M

JPY 8M

42.58 x198.9%

67

OfficeReal Estate for Sale

Shibuya-ku, Tokyo

24 years

JPY 1B-2B

2015/03

JPY 59M

JPY 94M

6.39 x54.4%

68

RetailReal Estate for Sale

Shibuya-ku, Tokyo

14 years<JPY 1B

2015/04

JPY 42M

JPY 79M

5.65 x

27.9%

69

Hotel

Real Estate for Sale

Osaka City, Osaka

13 years

JPY 2B-3B

2015/05

JPY 178M

JPY 633M

1.56 x

58.3%

70

Hotel

Real Estate for Sale

Aomori City, Aomori

8 years<JPY 1B

2015/06

JPY 45M

JPY 113M

2.10 x20.2%

71RetailReal Estate for Sale

Fujisawa City, Kanagawa

0 years

JPY 1B-2B

2015/07

JPY 99M

JPY 126M

6.80 x37.3%

72

OfficeReal Estate for Sale

Taito-ku, Tokyo

24 years>JPY 3B

2015/07

JPY 234M

JPY 155M

2.49 x247.3%

73

OfficeReal Estate for Sale

Toshima-ku, Tokyo

22 years

JPY 2B-3B

2015/07

JPY 135M

JPY 91M

2.84 x332.6%

74

OfficeReal Estate for Sale

Osaka City, Osaka

22 years

JPY 1B-2B

2015/07

JPY 56M

JPY 31M

2.07 x196.4%

75

OfficeReal Estate for Sale

Fukuoka City, Fukuoka

26 years

JPY 1B-2B

2015/07

JPY 74M

JPY 42M

2.55 x274.5%

No
No.

Asset Class

61

Mixed (Office/Retail)Operating Loan

62

Retail63

12

Asset Type

Location

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

48

Value-Add Full Asset Breakdown (6)NoNo.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

76

OfficeReal Estate for Sale

Nagoya City, Aichi

31 years

JPY 2B-3B

2015/07

JPY 126M

JPY 71M

2.54 x271.0%

77

OfficeReal Estate for Sale

Nagoya City, Aichi

31 years

JPY 1B-2B

2015/07

JPY 110M

JPY 60M

2.78 x353.7%

78

OfficeReal Estate for Sale

Minato-ku, Tokyo

23 years

JPY 1B-2B

2015/07

JPY 76M

JPY 59M

2.93 x323.9%

79

OfficeReal Estate for Sale

Shibuya-ku, Tokyo

30 years

JPY 1B-2B

2015/07

JPY 56M

JPY 42M

2.70 x266.9%

80

OfficeReal Estate for Sale

Chuo-ku, Tokyo

31 years

JPY 1B-2B

2015/07

JPY 65M

JPY 45M

2.68 x257.2%

81

OfficeReal Estate for Sale

Toshima-ku, Tokyo

26 years

JPY 2B-3B

2015/07

JPY 128M

JPY 86M

2.11 x185.8%

82

OfficeReal Estate for Sale

Osaka City, Osaka

25 years

JPY 2B-3B

2015/07

JPY 120M

JPY 69M

1.68 x117.8%

83

OfficeReal Estate for Sale

Nagoya City, Aichi

25 years

JPY 1B-2B

2015/07

JPY 69M

JPY 42M

2.09 x198.8%

84

OfficeReal Estate for Sale

Nagoya City, Aichi

34 years>JPY 3B

2015/07

JPY 178M

JPY 107M

3.05 x383.6%

85

OfficeReal Estate for Sale

Bunkyo-ku, Tokyo

23 years

JPY 1B-2B

2015/07

JPY 114M

JPY 428M

1.34 x16.8%

86Mixed (Office/Retail)Real Estate for Sale

Minato-ku, Tokyo

7 years

JPY 1B-2B

2015/07

JPY 57M

JPY 293M

1.19 x20.4%

87

OfficeReal Estate for Sale

Chiyoda-ku, Tokyo

8 years

JPY 1B-2B

2015/07

JPY 50M

JPY 237M

1.11 x12.8%

88

OfficeReal Estate for Sale

Shinagawa-ku, Tokyo

28 years

JPY 1B-2B

2015/07

JPY 96M

JPY 355M

1.32 x15.8%

89

OfficeReal Estate for Sale

Musashino City, Tokyo

27 years>JPY 3B

2015/07

JPY 127M

JPY 670M

1.72 x13.3%

90OfficeReal Estate for Sale

Osaka City, Osaka

22 years>JPY 3B

2015/07

JPY 76M

JPY 248M

1.29 x15.6%

12Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

49

Value-Add Full Asset Breakdown (7)NoNo.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

91

OfficeReal Estate for Sale

Osaka City, Osaka

17 years

JPY 1B-2B

2015/07

JPY 94M

JPY 330M

1.14 x16.1%

92

OfficeReal Estate for Sale

Fukuoka City, Fukuoka

8 years

JPY 1B-2B

2015/07

JPY 87M

JPY 353M

1.82 x17.7%

93

OfficeReal Estate for Sale

Fukuoka City, Fukuoka

13 years

JPY 1B-2B

2015/07

JPY 87M

JPY 358M

1.92 x18.8%

94

OfficeReal Estate for Sale

Nagoya City, Aichi

6 years

JPY 2B-3B

2015/07

JPY 143M

JPY 588M

1.21 x26.3%

95

OfficeReal Estate for Sale

Nagoya City, Aichi

24 years

JPY 1B-2B

2015/07

JPY 59M

JPY 240M

1.17 x

19.4%

96

Hotel

Real Estate for Sale

Sapporo City, Hokkaido

23 years<JPY 1B

2015/08

JPY 26M

JPY 2M

5.52 x291.5%

97

Hotel

Real Estate for Sale

Chuo-ku, Tokyo

1 years

JPY 1B-2B

2015/09

JPY 70M

JPY 240M

1.49 x

48.7%

98

Hotel

Real Estate for Sale

Naha City, Okinawa

27 years

JPY 2B-3B

2015/11

JPY 166M

JPY 640M

1.91 x25.9%12Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

50

Value-Add Full Asset Breakdown (8)No.

Asset Class

Asset Type

Location

Building
Age

Acquisition Price

Acquired
Date

Expected
NOI/Year

IchigoInvestment

Forecast Equity
Multiple1

Forecast
IRR2

99

Hotel

Real Estate for Sale

Suginami-ku, Tokyo

23 years

JPY 2B-3B

2015/12JPY 182M

JPY 764M

1.74 x

74.4%

100

Hotel

Real Estate for Sale

Taito-ku, Tokyo

23 years

JPY 1B-2B

2015/12JPY 85M

JPY 387M

1.71 x

70.6%

101

Hotel

Real Estate for Sale

Okayama City, Okayama

32 years<JPY 1B

2015/12JPY 81M

JPY 321M

1.58 x

57.9%

102

Hotel

Real Estate for Sale

Matsuyama City, Aichi

27 years

JPY 1B-2B

2015/12JPY 114M

JPY 412M

1.69 x

68.5%

103

Hotel

Real Estate for Sale

Naha City, Okinawa

41 years

JPY 2B-3B

2015/12JPY 192M

JPY 596M

2.04 x104.3%

104

Hotel

Real Estate for Sale

Osaka City, Osaka

31 years>JPY 3B

2015/12JPY 341M

JPY 1,437M

1.76 x

76.0%

105

Hotel

Real Estate for Sale

Kumamoto City, Kumamoto 31 years

JPY 1B-2B

2015/12JPY 117M

JPY 453M

1.61 x

61.2%

106

Hotel

Real Estate for Sale

Tokoname City, Aichi

11 years>JPY 3B

2016/12JPY 274M

JPY 1,228M

1.46 x

46.4%

107

H t l
Hotel

R lE
Real
Estatet t ffor Sale
S l

K hi Cit
KushiroCity, H
Hokkaido
kk id

6 years<JPY
JPY 1B

2016/12JPY 26M

JPY 107M

1 59 x
1.59

59 4%
59.4%

108

Hotel

Real Estate for Sale

Suzuka City, Mie

8 years<JPY 1B

2016/12JPY 25M

JPY 95M

1.60 x59.7%

JPY 184,754M

JPY 10,964M

JPY 38,570M

2.26 x

78.4%

4 Assets

JPY 5,740M

JPY 328M

JPY 1,026M

2.26 x47.7%

Assets acquired in FY16/2 Q2 29 Assets

JPY 55,210M

JPY 2,837M

JPY 6,731M

1.63 x143.5%

Assets acquired in FY16/2 Q3

2 Assets

JPY 3,830M

JPY 235M

JPY 880M

1.80 x37.7%

Assets acquired in FY16/2 Q4 10Assets

JPY 20,853M

JPY 1,437M

JPY 5,800M

1.69 x67.8%

Assets acquired in FY16/2 45 Assets

JPY 8585,635M
635M

JPY 4
4,838M
838M

JPY 14
14,437M
437M

1 71 x
1.71

113 5%
113.5%

Note: 3 Assets acquired and sold in FY 16/2

JPY 5,082M

JPY 298M

JPY 1,711M

1.19 x87.1%

Total 108 Assets
Assets acquired in FY16/2 Q1

1
2

Forecast Equity Multiple is based on the business plan of each asset and is the expected sum of rental income and profits on sale divided by Ichigo Investment.
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 reflect assets
acquired from FY15/2 onward and exclude Fixed Assets.
Assets© 2016 Ichigo Inc. All rights reserved.

51

Reference: Japanese Feed-in-Tariff (FIT)
What is a FIT?
‒‒

A policy mechanism designed to accelerate the deployment of renewable energy such as solar andwind, guaranteeing a long-term sale price for electricity (in Japan, 20 years) at a fixed price.
Japan’s FIT is updated every year.
Contract Date

Tariff per
1kWh*Guarantee
PeriodContract Date

Tariff per
1kWh*Guarantee
PeriodFY201240 yen20 years

4/1-6/30)
6/30)
FY2015(4/1

29 yen20 years

FY201336 yen20 years

FY2015(7/1-3/3)

27 yen20 years

FY201432 yen20 years

FY201624 yen20 years*Pre-consumption tax FIT for power plants with output of>10kW
Source: Agency for Natural Resources and Energy

Current Regulatory Framework and Ichigo Plant Status‒‒‒

Utilities are allowed to suspend its renewable energy supply without compensation if supply exceeds
demand The maximum suspension duration is total 30 days or 360 hours per annum
demand.
annum.
Although utilities are not allowed to suspend the acceptance of applications (based on the “Act on
Special Measures concerning the Procurement of Renewable Electric Energy by Operators of Electric
Utilities”), approval for grid connection is pending for many solar power suppliers. All of Ichigo’s power
plantsl t havehgrid
id connection
ti approvals.
l
In certain cases, utilities that are potentially subject to renewable energy production that exceeds theirgrid capacity are allowed to suspend renewable energy supply from new suppliers without limit andwithout compensation. None of Ichigo’s power plants are subject to these suspensions.

© 2016 Ichigo Inc. All rights reserved.

52

Clean Energy Near-Term Earnings‒ Significant Revenue Growth‒ Positive Operating Profit (FY16/2 OP = JPY 323M vs. FY15/2 JPY -93M)(Milli Yen)
(MillionY )FY15/2(12M)

FY16/2(12M)

FY16/2 Initial Full-Year
Forecast

vs Initial Full-Year
Forecast

Revenues

605

1,628

1,581

103.0%

Cost of Goods Sold

411

945

992

-

Gross Profit

194

683

589

116.0%

SG&A

288

358

390

―

(including offsets of cross
crosssegment transactions)

―

―

―

―

Operating Profit

-93

323

198

163.1%((Reference)) Interest
Expense

69

104

144

―

17 Plants Online
29.33MW

24 Plants Online
41.97MW

Adjustments

Solar Power Plant
Schedule

35 Plants Online
111.95MW (Plan)(Forecast)

Total operating and in-development: 35 plants, 111.95MW© 2016 Ichigo Inc. All rights reserved.

53

Individual Solar Power Plant P&L Breakdown (1)Total 20-Year Forecast IRR for All Plants: 39.1% p.a.
No.

Area

Panel
p
Output(MW)

Fixed
Tariff(P t(Pre-tax,
yen)

Operation
St t Date
Start
D t

40

Aug-13

Expected
NOI/Y
NOI/Year

Depreciationp

IchigoI
Investmenttt

Forecast Equityp ((If held
Multiplefor 20 years) 1

Forecast
IRR2

1

Ichigo Tokushima Higashi Okinosu ECO Power Plant

2

Ichigo Kiryu Okuzawa ECO Power Plant

Kanto

1.33

40

Sep-13

JPY 42M

JPY 20M

JPY 94M

4.77 x17.6%

3

Ichigo Motomombetsu ECO Power Plant

Hokkaido

1.40

40

Feb-14

JPY 44M

JPY 21M

JPY 134M

3.84 x15.2%

4

Ichigo Fuchu Jogecho Yano ECO
CO Power Plant

C
Chugoku

0.99

40

Mar-14

JPY 28M

JPY 15M

JPY 102M

3.09 x12.4%%

5

Ichigo Muroran Hatchodaira ECO Power Plant

Hokkaido

1.24

40Mar-14

JPY 41M

JPY 20M

JPY 138M

3.29 x12.3%

6

Ichigo Engaru Kiyokawa ECO Power Plant

Hokkaido

1.12

40Mar-14

JPY 35M

JPY 16M

JPY 93M

4.17 x16.5%

7

Ichigo Yubetsu Barou ECO Power Plant

Hokkaido

0.80

40

Apr-14

JPY 23M

JPY 13M

JPY 31M

5.30 x15.0%

8

Ichigo Iyo Nakayamacho Izubuchi ECO Power Plant

Shikoku

1.23

40

Apr-14

JPY 43M

JPY 19M

JPY 73M

6.58 x25.3%

9Ichigo Maebashi Naegashima ECO Power Plant

Kanto

0.67

40

Apr-14

JPY 25M

JPY 9MJPY 40M

8.57 x34.3%

10

Ichigo Betsukai Kawakamicho ECO Power Plant

Hokkaido

0.8840

Oct-14

JPY 29M

JPY 14M

JPY 42M

6.31 x23.0%

11

Ichigo Toyokoro Sasadamachi ECO Power Plant

Hokkaido

0.61

40

Oct-14

JPY 23M

JPY 10M

JPY 31M

7.27 x27.4%

12

Ichigo Nakashibetsu Midorigaoka ECO Power Plant

Hokkaido

1.93

40

Nov-14

JPY 64M

JPY 29M

JPY 175M

4.09 x15.3%

13

Ichigog Abira Toasa ECO Power Plant

Hokkaido

1.1740

Dec-14

JPY 39M

JPY 19M

JPY 36M

10.12 x35.2%

14Ichigo Toyokoro ECO Power Plant

Hokkaido

1.03

40

Dec-14

JPY 41M

JPY 16M

JPY 65M

7.59 x33.0%

15

Ichigo Higashi Hiroshima Saijocho Taguchi ECO Power Plant

Chugoku

2.73

40

Jan-15

JPY 97M

JPY 41M

JPY 241M

5.15 x20.3%

16

Ichigo Nago Futami ECO Power Plant

Okinawa

8.44

40

Feb-15

JPY 308M

JPY 132M

JPY 1,189M

3.48 x12.0%

17

Ichigo Engaru Higashimachi ECO Power Plant

Hokkaido

1.24

40

Feb-15

JPY 40M

JPY 19M

JPY 32M

10.90 x37.5%

Shikoku

2.52

JPY 84M

JPY 36M

JPY 129M

7.46 x

26.2%

1 Forecast Equity Multiple is based on the P-50* business plan of each plant and is the expected sum of income divided by Ichigo Investment.
2 Forecast IRR is the internal rate of return based on each plant’s P50 forecast cash flow.
* P50 is a third-party, 50% probability mean annual production forecast that serves as the base forecast for each solar power plant’s operating plan.

© 2016 Ichigo Inc. All rights reserved.

54

Individual Solar Power Plant P&L Breakdown (2)
No.

Area

Panel
Output(MW)

Fixed
Tariff(Pre-tax,
yen)

Operation
Start Date

Expected
NOI/Year18

Ichigo Akkeshi Shirahama ECO Power Plant

Hokkaido

0.81

40Mar-15

JPY 23M

19

Ichigog Takamatsu KokubunjichojNii ECO Power Plant

Shikoku

2.43

36

Jun-1520

Ichigo Miyakonojo Yasuhisacho ECO Power Plant

Kyushu1.44

36

Jul-1521

Ichigo Toyokawa Mitocho Sawakihama ECO Power Plant

Chubu

1.80

32

22

Ichigo Yamaguchi Aionishi ECO Power Plant

Chugoku

1.24

23

Ichigo Hamanaka Bokujo Tsurunokotai ECO Power Plant

Tohoku2.31

24

Ichigo Yonago Izumi ECO Power Plant

Chugoku

2 61
2.61

25

Ichigo Kasaoka Takumicho ECO Power Plant

Chugoku

1.12

26

Ichigo Yamaguchi Sayama ECO Power Plant

Chugoku

2.36

27

Ichigo Toki Oroshicho ECO Power Plant

Chubu

1.40

28

Ichigo Toride Shimotakai Kita ECO Power Plant

Kanto

1.03

29

Ichigo Toride Shimotakai Minami ECO Power Plant

Kanto

0 54
0.54

30

Ichigo Hamanaka Bokujo Kajibayashi ECO Power Plant

Tohoku2.31

31

Ichigo Sera Tsukuchi ECO Power Plant

Chugoku

2.54

32

Ichigo Sera Aomizu ECO Power Plant

Chugoku

2.75

33

Ichigo Kure Yasuuracho Nakahata ECO Power Plant

Chugoku

34

Ichigo Showamura
S
Ogose
O
ECO
CO Power Plant

35

Ichigo Minakami Aramaki ECO Power Plant

Depreciation

IchigoInvestment

Forecast Equity
Multiple (If heldfor 20 years)1

Forecast
IRR2

JPY 13M

JPY 43M

4.21 x14.6%

JPY 85M

JPY 32M

JPY 59M

16.72 x37.9%

JPY 46M

JPY 20M—--

Sep-15

JPY 41M

JPY 22M

JPY 10M

32.63 x97.1%

40

Dec-15

JPY 42M

JPY 19M

JPY 13M

29.44 x87.0%

36

Dec-15

JPY 74M

JPY 31M

JPY 22M

30.84 x92.6%

40Jan-16

JPY 89M

JPY 34M

—

-

-

32

Mar-16

JPY 26M

JPY 14M

JPY 10M

20.48 x59.6%

36

Apr-16

JPY 74M

JPY 33M

JPY 19M

36.82 x127.7%

36

Jun-16

JPY 41M

JPY 20M

JPY 9M

38.04 x96.1%

32

Jul-16

JPY 25M

JPY 13M

JPY 8M

26.18 x67.7%

32

Jul 16
Jul-16

JPY 12M

JPY 6MJPY 3M32 29 x
32.29

75 3%
75.3%

36

Oct-16

JPY 74M

JPY 33M

JPY 45M

15.13 x35.3%

32Jan-17

JPY 68M

JPY 30M

JPY 50M

6.93 x22.2%

32

Feb-17

JPY 74M

JPY 33M

JPY 54M

6.92 x

21.7%

2.65

36

Aug-17

JPY 70M

JPY 35M

JPY 88M

7.43 x

19.8%

Kanto

43.01

36

Jan-18JPY 1,359M

JPY 606M

JPY 482M

29.07 x

43.1%

Kanto

10.26

36

Jul-18

JPY 347M

JPY 176M

JPY 329M

9.40 x14.9%

JPY 3,576M

JPY 1,619M

JPY 3,889M

13.47 x39.1%

Total 111.95MW

1 Forecast Equity Multiple is based on the P-50* business plan of each plant and is the expected sum of income divided by Ichigo Investment.
2 Forecast IRR is the internal rate of return based on each plant’s P50 forecast cash flow.

*P50 is a third-party, 50% probability mean annual production forecast that serves as the base forecast for each solar power plant’s operating plan.
(Note) Plants No. 27 to 31 are new projects as of Q4 .

Updates・Plants expected to start operation in FY17/2: Ichigo Toride Shimotakai Kita & Minami, Ichigo Toki Oroshicho, Ichigo Sera Tsukuchi
・Panel output change: Ichigo Sera Aomizu 2.05MW→2.75MW・Expected NOI/Year, Depreciation, Ichigo Investment, Forecast Equity Multiple, and Forecast IRR have been updated on an individual plant basis as
appropriate to reflect current forecast operating conditions.
© 2016 Ichigo Inc. All rights reserved.

55

Consolidated Balance Sheet: Assets(Milli Yen)
(MillionY )FY12/2
AssetsCurrent Assets
Cash and cash equivalents
Trade notes and accounts receivable
Operational investments in loans
Operational investments in securities
Real estate for sale
Deferred tax assets
Oth
Other
Less: allowance for doubtful
Total Current Assets
Fixed Assets
Property, Plant, and Equipment
Buildings and structures (net)
Equipment (net)Land
Other (net)Total Property, Plant, andEquipment
Intangible Assets
Goodwill
Leasehold rights
Other
Total Intangible Assets
Investments and Other Assets
Investments in securities
Long-term loans receivable
Deferred tax assets
Other
Less: allowance for doubtful
Total Investments and Other
AssetsTotal Fixed Assets
Total Assets© 2016 Ichigo Inc. All rights reserved.

FY13/2

9 791
9,791
1,069
2,527
4,226
49,674

FY14/2

FY15/2

FY16/2

vs FY15/2

9,713
9
713
548
3,636
4,271
46,176
369
2 042
2,042
-3,177
63,581

24,991
24
991
451
1,100
3,583
54,084
576
1 384
1,384
-410
85,761

19,383
19
383
519
2,330
1,965
109,769
1,200
2 657
2,657
-484
137,342

28,779
28
779
691
1,324
1,784
172,833
1,766
3 966
3,966
-458
210,687+9,396+9396+172-1,006-181+63,064+566+1,3091 309+26+73,345

－
7,114
91

2,863
21
7,082
80

4,901
2,044
12,433
1,922

4,021
9,168
12,142989

3,830
12,267
12,192
3,255-191+3,099+50+2,266

10,10910,047

21,30026,321

31,546+5,225

2,077

2,203
－
20
2,223

2,082
392
27
2,502

1,942
392
38
2,373

-140

－
27
2,105

2,221
392
71
2,686

3,589
3
589
14

4,278
4
278
13
222
780
-97

5,266
5
266
12
2
1,392
-95

5,486
5
486
12
39
1,736
-124

+220

－
623
-96

4,117
4
117
13
0
545
-101

－
+37
+344
-29

4 131
4,131

4 575
4,575

5 196
5,196

6 578
6,578

7 149
7,149

+571

16,34682,17016,84680,42829,183
114,944

35,402
172,744

41,069251,757+5,667+79,013

－
1,465
1
465
-2,93065,824

2,903

－
+11
-129

56

Consolidated Balance Sheet: Liabilities & Net Assets(Milli Yen)
(MillionY )FY12/2
Liabilities
Current Liabilities
Trade notes and accounts payable
Short-term borrowings
Short-term non-recourse loans
Long-term borrowings (due within one year)
Long-term non-recourse loans (due within one year)
Income taxes payable
Deferred tax liabilities
Accrued bonuses
Other current liabilities
Total Current Liabilities
Long-Term Liabilities
Non-recourse bonds
Long-term borrowings
Long-term non-recourse loans
Deferred tax liabilities
Long-term security deposits received
Negative goodwill
Other long-term liabilities
Total Long-Term Liabilities
Total Liabilities
Net Assets
Shareholders’ Equity
CapitalCapital reserve
Retained earnings
Treasury shares
Total Shareholders’Shareholders Equity
Accumulated Other Comprehensive Income
Valuation gain (loss) on other securities
Deferred gain (loss) on hedges
Foreign currency translation adjustment
Total Accumulated Other Comprehensive Income
Stock Options
p
Minority Interests
Total Net Assets
Total Liabilities and Net Assets© 2016 Ichigo Inc. All rights reserved.

FY13/2

FY14/2

FY15/2

FY16/2

vs FY15/2

57
170
－
1,768
8,793
115
－
22
2,974
13,902

64
484
－
966
2,263
65
15
25
3,419
7,304

132
950
－
3,123
428
96
24
14
2,817
7,588

124
1,416
48
3,488
786
284
30
16
3,677
9,872

80
2,188
79
8,161
2,975
631
53
13
3,979
18,161

-44
+772
+31
+4,673+2,189
+347
+23
-3
3
+302
+8,289－7,413
28 89928,899
6
3,362
360
36
40,08053,982－
5,456
32 77632,776
277
3,230
270
46
42,05649,361－
26,12624 17824,178
1,213
4,770
180
44
56,51364,102100
53,40943 00443,004
1,402
6,391
90
96
104,494
114,367100
94,40956 19356,193
1,543
8,707
－
475
161,430
179,591－+41,000+13 189+13,189+141+2,316-90+379+56,936+65,224

18,078
2,395
6,298
-187
26 584
26,584

18,113
2,429
7,923
-187
28 27928,27926,443
10,808
10,891-92
48 05048,05026,49910,873
17,201-78
54 49654,496

26,575
10,96829,454-41
66 956
66,956+76+95+12,253+37+12 460+12,460

-604
－
-7
ᇞ 612
116
2,099
28,187
82,170

160
－
16
177
143
2,466
31,06680,428

400
－
9
409
121
2,261
50,842
114,944

1,208
-36
6
1,177
198
2,505
58,377
172,744

761
-251
23
533
319
4,357
72,166
251,757

-447
-215
+17
-644
+121
+1,852+13,789+79,01357

Consolidated P&L(Milli Yen)
(MillionY )FY12/2
Revenues
Cost of Goods Sold
Gross Profit
SG&A
Operating Profit
Non-Operating Profit
Interest income
Dividend income
Equity in earnings of affiliates
Amortization of negative goodwill
Other
Total Non-Operating Profit
Non-Operating Expenses
Interest expense
Issuance cost of corporate bonds
Stock issuance cost
Other
Total Non-Operating Expenses
Recurring Profit
Extraordinary Gain
Gain on sales of fixed assets
Gain on sales of investment securities
Gain on redemptions of equity holdings
Receipt of share trading proceeds
Other
Total Extraordinary Gain
Extraordinary Loss
Loss on sale and retirement of fixed assets
Loss on sale of investment securities
Valuation loss on investments in securities
Office move expenses
Impairment Loss
Loss on business liquidation
Other
Total Extraordinary Loss
Pre-Tax Net Income
Income Taxes - Current
Income Taxes - Deferred
Total Income Taxes
Profit before Gain on Minority Interests
Gain on Minority Interests
Net Income© 2016 Ichigo Inc. All rights reserved.

FY13/2

FY14/2

FY15/2

FY16/2Full-Year
Forecast

vs FY15/2

vs Full-Year
Forecast

18,952
15,030
3 921
3,921
2,871
1,050

16,397
11,422
4 974
4,974
3,130
1,844

35,101
27,666
7 435
7,435
3,522
3,912

42,70530,53912 166
12,166
3,977
8,189

49,69929,83519 863
19,863
4,446
15,417+6,994-704+7 697+7,697+469+7,22845,000－16 50016,500－11,700110.4%－
120 4%
120.4%－
131.8%

5
20
141
90
33
291

3
24
－
90
36
155

4
112
－
90
31
238

5
78
－
90
39
213

2
79
0
90
43
215

-3
+1
－
－
+4
+2

－
－
－
－
－
－

－
－
－
－
－
－

284
48
－
29
361
979

238
－
0
26
265
1,734

370
－
89
93
553
3,597

943
－
－
202
1,146
7,255

1,277
－
－
465
1,743
13,889

+334
－
－
+263
+597
+6,634－－－－－
10,250－－－－－135.5%

－
－
1,173
－
75
1,248

9
72
－
－
0
83

7
204
－
434
33
680

－
－
－
－
57
57

－
223
－
－
0
223

－
+223
－
－
-57
+166

－
－
－
－
－
－

－
－
－
－
－
－

38
62
－
14
－
26
109
251
1,976
159
－
159
1,817
47
1,770

1
－
62
19
33
－
8
124
1,693
54
-106
-51
1,745
108
1,637

1
－
－
21
307
－
13
344
3,933
43
-616
-573
4,506
-19
4,526

0
－
－
1
－
－
91
93
7,220
564
-220
343
6,876
115
6,761

－
－
49
9
－
－
31
89
14,022
1,330
-369
960
13,062
136
12,925

－
－
+49
+8
－
－
-60
-4
+6,802
+766
-149
+617
61
+6,186+21+6,164

－
－
－
－
－
－
－
－
－
－
－
－
－
－
9,150

－
－
－
－
－
－
－
－
－
－
－
－
－
－
141.3%

58

Consolidated Cash Flows from Operating Activities(Milli Yen)
(MillionY )FY12/2 (12M)
Cash Flows from Operating Activities
Pre-tax net income
Depreciation
Share-based compensation expenses
Amortization of goodwill
Amortization of negative goodwill
Increase (decrease) in accrued bonuses
Increase (decrease) in allowance for doubtful
Increase (decrease) in other allowancesInterest and dividend income
Interest expense
Issuance cost of corporate bonds
Equity in earnings of affiliates (gain)
Loss (gain) on sales of equity holdings in affiliates
Loss (gain) on sales of investment securities
Loss (gain) on sales/retirement of fixed assets
Impairment Loss
Valuation loss on investments in securities
Decrease (increase) in trading notes and receivables
Decrease (increase) in operating loan receivables
Decrease (increase) in operational investments
Valuation loss on operational investments insecurities
Decrease (increase) in real estate for sale
Valuation loss on investments in capital
Valuation loss on investments in capital
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
Net Cash from (Used for) Operating Activities© 2016 Ichigo Inc. All rights reserved.

FY13/2 (12M)

FY14/2 (12M)

FY15/2 (12M)

FY16/2 (12M)

1,976
166
37
107
-90
-2
-3,529
-135
-26
284
48
-141
-1,173
62
38
－
－
-269
454
3,068

1,693
230
49
114
-90
3
195
-11
-28
238
－
－
－
-72
-8
33
62
515
-1,100
723

3,933
304
69
139
-90
-11
33
－
-116
370
－
－
－
-204
-6
307
－
97
218
1,635

7,220
565
112
139
-90
1
65
－
-83
943
－
－
－
－
－
－
－
-68
-1,2301,110

14,022
792
174
139
-90
-3
3
－
-81
1,277
－
－
－
-223
－
－
49
-172
1,006
1,239

139

63

114

－

19

610
471
41
－
-179
-137
1,067
-141
-81
-240
2,425
171
-315
315
-154

2,556
119
1
－
-380
-39
519
11
-253
-239
4,908
28
-220
220
-106

-6,729
－
12
－
-255
-139
137
38
1,230
522
1,611
116
-378
378
-94

-42,991－
91－-1,079
388
16
96
1,391
-407
-33,437
83
-843
843
161

-63,070－11-990-1,140
535
42
317
2,380
435
-43,324
81-1,226
1 226
-186

2,127

4,609

1,254

-34,292-44,65459

Consolidated Cash Flows from Investing & Financing Activities(Million Yen)
FY12/2
Cash Flows from Investing Activities
Payments into time deposits
Proceeds from withdrawal of time deposits
Acquisition of investment securities
Proceeds from sales of investment securities
Proceeds from redemptions of investment securities
Proceeds from sale of securities in affiliates
Acquisition of property and equipment
Proceeds from sale of property and equipment
Acquisition of intangible assets
P
Paymentst for
f investmentsitt
Proceeds from redemptions of investments
Proceeds from sale of investments
Payments of security deposits
Payments for acquisitions of subsidiaries resulting in thechange of consolidation scope
Payments for acquisitions of newly consolidated
Other
Net Cash from (Used for) Investing Activities
Cash Flows from Financing Activities
Increase (decrease) in short-term bank loans, net
Increase (decrease) in short-term non-recourse loans,net
Proceeds from issuance of corporate bonds
Redemption on corporate bonds
Proceeds from issuance of non-recourse bonds
Redemption of non-recourse bonds
Proceeds from long-term bank loans
Repayment of long-term bank loans
Proceeds from long-term non-recourse loans
R
Repaymentt off long-termlt
non-recourse loanslProceeds from issuance of common shares
Payment on share buyback
Proceeds from exercise of stock options
Proceeds from minority interests
Share issuance to minority shareholders
Payments to minority shareholders for redemption ofcommon stock
Cash dividends paid to minority interests
Net Cash from (Used for) Financing Activities© 2016 Ichigo Inc. All rights reserved.

FY13/2

FY14/2

FY15/2

-352
－
－
137
40
3,327
-63
9
-7
－
－
4
－

-0
151
-15
76
30
－
-124
17
-0
-4
4
0
－
－

-0
－
－
282
2
－
-7,150
72
-389
-5
5
7
－
-5

-271

-218

FY16/2

-325
325
-210
－
0
－
-10,769
－
-23
-10
10
0
－
-127

0
－
-671
296
3
－
-6,628
－
-21
-9
9
6
－
-37

-1,389－－－9-7,052

－
-14
2,808

－
60
-27

－
-35
-8,610-1,3494-12,485-1,123

314

465

466

771

－

－

－

48

31

6 059
6,059
-6,5002,100-2,4552,900-2,807
11,610-14,231
14 231
－
-935
－
-0
－

－
－
－
－
5,440
-8,19912,346-13,885
13 885
－
－
48
－
20

－
－
－
－
26,777-5,388
5,675-19,030
19 03016,387
－
242
-445
－

－
－
－
－
47,203-19,557
19,900-5,958
5 958
－
－
99
-543
－

－
－
－
－
64,866-19,192
18,150-2,772
2 772
－
－
153
-646
2,000

-30
30

-19
19

－

－

－

-65
-5,480-0-3,935－
24,682－
41,658-43
63,31860

MEMO© 2016 Ichigo Inc. All rights reserved.

61

MEMO

© 2016 Ichigo Inc. All rights reserved.

62

These materials were prepared to explain the Company’s businesses and are not for the purpose ofsoliciting investment in marketable securities issued by the Company. The Company does notguarantee the accuracy of the figures, information, estimates or other statements included herein, andaccepts 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 containforward-looking statements pertaining to the Company’s expectations, targets, plans and strategies.
Such forward-looking statements are not facts, but are the result of management’s judgment based on
information currently available. Actual operating results or developments concerning the Company
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.
Contact:
Ichigo (TSE1 2337)
Investor Relations

Ichigog is Japan’s
pfirst zero-carbon listed real estate company.
p y We are takingg
responsibility for our environmental footprint by offsetting our carbon emissions
and investing in low-carbon technologies such as solar energy.
© 2016 Ichigo Inc. All rights reserved.

TEL: +81-3-3502-4818 FAX:+81-3-3502-4801
E-mail： ir@ichigo.gr.jp
www.ichigo.gr.jp/english

63