Hankyu Hanshin Holdings Group
Results Briefing Materials for
Second Quarter of Fiscal 2018
(Ended September 30, 2017)
November 14th, 2017
Hankyu Hanshin Holdings, Inc.
9042 http://www.hankyu-hanshin.co.jp/en/

Contents
Ⅰ. Performance Highlights for the Second Quarter of
Fiscal 2018 (fiscal year ending 31st March 2018)･･･

Ⅱ. Forecasts for Fiscal 2018 (ending 31st March 2018)[Change from May forecasts]･･･ 21

Ⅲ. Referential Materials･･･ 292〔Others〕①Long-Term Management Vision for 2025 (Fiscal 2026)･･･ 39
and Medium-Term Management Plan
②Main Projects･･･ 54This document contains forward-looking statements such as business performance forecasts. These statements are based on currently
available information and what we believe to be reasonable assumptions; they do not, however, represent guarantees of future performance.
Actual results or developments may differ materially from those in the forward-looking statements as a result of various factors.

1

Ⅰ. Performance Highlights for

the Second Quarter of Fiscal 2018
(fiscal year ending 31st March 2018)2

3

Consolidated Statements of Income(Summary)
1H FY2018
Results

FY2017
Results

ChangeConsolidated Subsidiaries
Equity-Method Affiliates
Total

93 companies 93 companies ±0 (2 companies increase, 2 companies decrease)
11 companies 11 companies
104 companies 104 companies ±0 (2 companies increase, 2 companies decrease)(¥ million)

1H FY2018
Results

1H FY2017
Results

ChangeRemarks

361,906

359,950 +1,955(+0.5%)

62,661

58,348 +4,313(+7.4%)

Non-operating income

6,524

5,409 +1,114

Non-operating expenses

6,334

7,061 -727

62,852

56,696 +6,155(+10.9%)

Extraordinary income

9,294

1,514 +7,780

Gain on contributions for construction+8,041

Extraordinary loss

9,569

1,785 +7,784

Loss on reduction of noncurrent assets+7,926

41,64938,587 +3,061(+7.9%)

Revenues from operations
Operating income

Ordinary income

Net income attributable toowners of the parent

1H FY2018
Results（Reference）

1H FY2017
Results

For details,
please see next page
Equity in income of affiliates +1,000

ChangeDepreciation and amortisation

25,94025,813+127

Financial balance ① - ②-4,323-5,215+892

Interest and dividend income①

792

587

+204

Interest expense②

5,115

5,802

-687
4

Consolidated Statements of Income (Breakdown for each business segment)[Key results in current period]
The Travel Business segment saw rising numbers of visitors to European destinations,
the Entertainment and Communications Business segment benefitted from strong
performance in its sports business, and the International Transportation Business
reported strong performance, particularly in air transport. As a result, operating income
and revenue increased.
(¥ million)

Revenues from operations
1H FY2018
Results

1H FY2017
Results

118,127

119,628

Real Estate

89,448Entertainment andCommunications

Segment income
1H FY2018
Results

1H FY2017
Results-1,501

24,134

23,645+489

95,233-5,785

19,24519,018+226

64,96063,025+1,934

15,781

14,511+1,269Travel

18,377

15,403+2,9732,463

410+2,053

International
Transportation

40,163

34,978+5,185

1,609

568+1,040Hotels32,33831,898

+439

492

985

-492

Other

17,50018,343

-843

522

610

-88

Adjustment-19,009-18,561-447-1,587-1,402

-185

Total

361,906

359,950+1,95562,661

58,348+4,313

Urban Transportation

ChangeChange5

Urban Transportation Results[Railway]
Income and profits increased, with the Hankyu and Hanshin lines performing well.

[Automobile]
Operating revenue declined partly because of the impact of excluding Nippon Rent-A-Car
Hankyu from the scope of consolidation in March 2017. Operating income declined amid
higher fuel costs and other factors.
(¥ million)

1H FY2018
Results

1H FY2017
Results

Change%Revenues from operations

118,127

119,628-1,501-1.3%

Operating income

24,134

23,645

+489

+2.1%

[Breakdown by type of business](¥ billion)
Revenues from operations

1H FY2018
Results

Y on Y

Railway

76.3

+1.4

Automobile

24.1

-0.7

Retailing

15.4

-1.9

Advertising

4.0

-0.1

Others3.1-0.5*Not including head office expenses /adjustments.

Impact of excluding Nippon Rent-A-Car Hankyu
from the scope of consolidation.
(About ¥-0.6 billion)
It is the influence that Iina dining Co.,Ltd.
presenting Home-meal replacement businessbecame the equity-method affiliate from theconsolidated subsidiary. (About ¥-1.1 billion)
Impact of excluding Hankyu Style Labels’ apparelbusiness from the scope of consolidation .
(About ¥-0.5 billion)

6

[Urban Transportation] Railway Performance Results
Hankyu Corporation

Fare revenues (¥ million)*
1H FY2018 1H FY2017
Results
Results

ChangePassenger volumes (Thousands)*
1H FY2018 1H FY2017
Results
Results

ChangeCommuter pass

16,902

16,621+280(+1.7%)

172,347

169,666 +2,680(+1.6%)

Workers

14,481

14,206+275(+1.9%)

118,620

116,275 +2,344(+2.0%)

Students

2,420

2,415

+4(+0.2%)

53,72653,390

Other tickets

31,532

31,229+302(+1.0%)

159,933

158,615 +1,318(+0.8%)

Total

48,43447,851+583(+1.2%)

332,280

328,281 +3,999(+1.2%)+336(+0.6%)

Hanshin Electric Railway
Fare revenues (¥ million)*
1H FY2018 1H FY2017
Results
Results

ChangePassenger volumes (Thousands)*
1H FY2018 1H FY2017
Results
Results

ChangeCommuter pass

5,975

5,857

+118(+2.0%)

62,03660,936 +1,100(+1.8%)

Workers

5,338

5,226

+112(+2.1%)

48,64547,730+915(+1.9%)

Students

637

630+6(+1.1%)

13,39013,205+184(+1.4%)

Other tickets

11,186

10,867+318(+2.9%)

61,411

59,864 +1,547(+2.6%)

Total

17,161

16,724+437(+2.6%)

123,448

120,800 +2,647(+2.2%)＊ Revenue amounts less than one million yen, and numbers of passengers less than one thousand, are omitted.
For Hankyu Railway, “other ticket revenue/ridership” includes revenue/ridership associated with the PiTaPa usage sections.
Sum of tier 1 and tier 2 railway operators for both Hankyu Corporation and Hanshin Electric Railway

7

[Urban Transportation] Transportation Revenue (Factors of YoY Change)《Hankyu Corporation》《Hanshin Electric Railway》

Transportation revenue (tier 1 + tier 2)

Transportation revenue (tier 1 + tier 2)(¥ million)

Totals for commuter passes
and other tickets

1Ｑ

2Ｑ

First half
total(¥ million)
Totals for commuter
passes and other tickets

1Ｑ

2Ｑ

First half
total

FY2018 Results

24,532 23,901

48,434FY2018 Results

8,474

8,687

17,161FY2017 Results

24,194 23,656

47,851FY2017 Results

8,284

8,440

16,724

+190

+246

+437

+2.3％ +2.9％+2.6％

Change

+338

+244

+583

Change

(%)

+1.4％

+1.0％

+1.2％

(%)

Factors of YoY Change (estimated)
・Surge in travellers during Golden Week holiday+¥50million
・Cherry-blossom season surge (blooming time was longer than lastyear)+¥45million
・Other factors (e.g. increase in line-side areas populations, andincrease in inbound demand)+¥488million

Factors of YoY Change (estimated)
・Increase in visitors to Koshien Stadium (professional baseballgames)＋¥52million
・Increase in visitors to Kyocera Dome (events, professional
baseball games)+¥46million
・Other factors (e.g. the strong performance of the Hanshin
Namba Line, increase in line-side areas populations, andincrease in inbound demand)＋¥339million

8[Urban Transportation] Referential Information
Hankyu Line: Transportation revenue (tier 1 + tier 2)(¥ million)
1H
FY201832,628 16,902
62,720 31,532
95,348 48,434

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Commuter passes
Other tickets
Total

31,92260,01091,932

31,88060,08791,967

31,126
58,582
89,70829,48460,00089,48529,92260,26890,19130,39160,74991,141

31,29961,63092,92931,54960,91092,45932,272
62,92095,192

FY2008＝100%(FY) 2008

104%

2009

2010

2011

2012

2013

2014

2015

2016

2017

Hanshin Line: Transportation revenue (tier 1 + tier 2)
1H
FY2018
11,563
5,975
21,136 11,186
32,699 17,161

FY2008 FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017
Commuter passes
Other tickets
Total

8,783
16,09524,878

8,913
16,31625,2309,642
18,39628,038

10,126
18,89929,025

10,623
19,42230,045

10,74019,66930,41011,00820,26031,269

11,107
20,286
31,394

11,372
21,03532,407131%
FY2008＝100%★ Opening of Hanshin Namba Line(March, 2009）(FY) 2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

9

Real Estate Results[Real estate leasing]
Income and revenue increased, with rental buildings in the Umeda area performing well.

[Real estate sales and Others]
Operating revenue declined, partly because the total number of condominium units sold
was low compared to the previous fiscal year. Operating income, however, was on parwith last year’s level due in part to the sale of commercial-use land.
(¥ million)

1H FY2018
Results

1H FY2017
Results

Change%Revenues from operations

89,44895,233-5,785-6.1%

Operating income

19,24519,018

+226

+1.2%

[Breakdown by type of business](¥ billion)
Revenues from operations

1H FY2018
Results

Y on Y

Real estate leasing

52.7

+1.0

Real estate sales and Others

44.8

-6.7

*Not including head office expenses /adjustments.

Condominium sales: down 97 (183 units; previous year = 280 units)* The total number of condominium units sold over the full-year is expected to be around 1,200(compared to 1,087 in the previous year).
10[Real Estate] Referential Information
Total number of condominium units soldFY 2008

Number of units※1 1,141

FY 2009

FY 2010

FY 2011

FY 2012FY 2013

FY 2014

FY 2015

FY 2016

FY 2017

916

1,064

680

1,210

1,548

1,356

1,374

1,302

1,087

FY 2018
Forecasts
Approx.

1,200※1：Figures include units in shared buildings that the Group partly owns.

Major properties sold in fiscal 2018 (including projected sales)※2・Geo Tenroku Twin Towers（Kita-ku, Osaka）
358 units
・Geo Fukagawa Sumiyoshi（Koto-ku, Tokyo）
190units
・Geo Yotsuya Araki-cho（Shinjuku-ku, Tokyo）
131 units
・Geo Yotsuya Sanei-cho（Shinjuku-ku, Tokyo）
61 units
・Geo Utsukushigaoka 2-chome Hills（Yokohama, Kanagawa）52 units※2：Figures indicate total number of units.

［Geo Fukagawa Sumiyoshi］(Scheduled to be sold in March 2018)［Geo Tenroku Twin Towers］(Scheduled to be sold in March 2018)11

Entertainment and Communications Results[Sports]
Operating income and revenue increased due to factors like a rise in admissions for
Hanshin Tigers’ regular season games and strong sales of food, drink, and merchandise.

[Stage]Operating income and revenue increased thanks to the popularity of shows such as Snow
Troupe’s “The Sun in the Last Days of the Shogunate / Dramatic ‘S’!” and Cosmos
Troupe’s ‘Land of the Gods -The Twilight of the Romanovs- / Classical Bijoux’.

[Communication, media and Others]
Operating income and revenue increased with the broadcast and communications
increasing its subscriber numbers.
(¥ million)

1H FY2018
Results

1H FY2017
Results

Change%Revenues from operations

64,96063,025+1,934+3.1%

Operating income

15,781

14,511+1,269+8.8%[Breakdown by type of business](¥ billion)
Revenues from operations

1H FY2018
Results

Y on YSports

26.4

+1.1

Stage

17.1

+0.3

Comunication, media and Others

21.9

+0.7

*Not including head office expenses /adjustments.
12

Travel Results
Operating income and revenue increased. This was the result of the overseas travelbusiness seeing higher numbers of visitors to European destinations and the domestic
travel business benefitting from a resurgence in the number of visitors to Kyushu, which
had been adversely affected by the Kumamoto Earthquake of 2016.
(¥ million)

1H FY2018
Results

1H FY2017
Results

Change%Revenues from operations

18,377

15,403+2,973+19.3%

Operating income

2,463

410

+2,053+500.7%[Performance Highlights for the Second
Quarter of Fiscal 2018]◆Overseas travel billings : Ranking 3(※)
Billings： ￥105.9billion（Y on Y +11.1%)◆Domestic travel billings : Ranking 6(※)
Billings： ￥70.4billion （Y on Y +7.0%)【Overseas travel】
In addition to Europe, other overseas destinations (such as
Asian countries and Hawaii) also proved popular this year,
resulting in sales volume exceeded last year’s level.

【Domestic travel】

Kyushu, which appears to have recovered from the impact of
the Kumamoto Earthquake of 2016, saw strong visitor
numbers as did other domestic destinations. The exception◆Total travel billings : Ranking 6(※)
was Shikoku, which benefitted from the popularity of theBillings： ￥177.8billion（Y on Y +9.4%)
Shikoku pilgrimage in the reverse order (“Gyaku-uchi”) in the
Source: Sales volume indicates the aggregated volume for April to September.
The values for industry ranking are based on aggregated results from April to July. previous year. Consequently, sales volume exceeded lastSource: Japan Tourism Agency, ‘Bulletin on Sales Volumes among the Major
year’s level.
Travel Agents’ (Shuyō ryokō-sha no ryokō toriatsukai jōkyō sokuhō)※ The above figures indicate the aggregated results for Hankyu Travel
International, Hankyu Hanshin Business Travel, and Hanshin Travel International(intercompany transactions offset)

13International Transportation Results
Operating income and revenue increased, with subsidiaries in Japan and those in East
Asia and Europe performing well, particularly in air transport.

(¥ million)

1H FY2018
Results

1H FY2017
Results

Change%Revenues from operations

40,163

34,978+5,185+14.8%

Operating income

1,609

568

+1,040+182.8%[Performance Highlights for the Second
Quarter of Fiscal 2018]
・The Japan Section performed well, particularly in airtransport, in which it primarily handled automotive
components and electronic components.
・The America Section performed well, particularly in
Asia-origin air transport.

Air export consolidated freight weight (from Japan)
80,00070,00060,00050,00040,000・The Europe and East Asia Sections performed well,particularly in air exports of automobile components
and other goods.

30,000・Exchange rate fluctuations resulted in a slight increasein yen-equivalent value compared to last year, but thishad no major impact.

10,00066,64962,71358,24962,47861,09355,01562,22557,16549,74734,42920,0000（unit：ton）2008 2009 2010 2011 2012 2013 2014 2015 20162017
FY2009 FY2010 FY2011 FY2012 FY2013 FY2014 FY2015 FY2016 FY2017 1H
FY2018上半期

14Hotels Results
Operating revenue increased thanks in part to the opening of remm ROPPONGI in March 2017,
but operating income decreased as a result of YoY decline in sales among existing hotels andan increase in expenses, including those associated with the opening of remm ROPPONGI.

(¥ million)

1H FY2018
Results

Revenues from operations

1H FY2017
Results
31,898

+439

+1.4%

492

985

-492

-50.0%

Average daily rates (ADR) and occupancy rates of Hankyu Hanshin
Hotels in the Tokyo metropolitan area1 and Kansai area2
Tokyo metropolitan area ADR

Kansai area ADR

Tokyo metropolitan area occupancy rate (right axis)

Kansai area occupancy rate (right axis)

92.2%

89.9%

19,00017,000

79.7%

83.3%

15,210

1.
2.

94.3%

90.5%

90.8%

96.2% 100.0%
87.4% 80.0%

14,61915,18514,140FY201260.0%

13,384 40.0%
11,61620.0%

10,2109,407

9,521
FY20130.0%
FY2014FY2015FY2016

Kansai area

50.0%
43.6%
38.6%

40.0%

38.1%

31.4%

16,66515,853

13,520

9,000

（Yen）

88.6%

93.9%

14,28813,000

7,000

86.6%

92.2%

Non-Japanese guests as a percentageof overnight-stay guests
Tokyo metropolitan area

17,221

15,00011,00092.6%%

32,338Operating income

21,000ChangeFY2017

1H FY2018

（%）

36.9%

30.0%

37.0%

39.3%

22.7%
20.0%

25.0%
14.9%
13.1%

10.0%

12.3%
10.0%

0.0%
（%）

17.3%

The total figures for
1H FY2018 is 41.7％(+4.0 points fromprevious year)

FY2012 FY2013 FY2014 FY2015 FY2016 FY2017

Directly managed Hanshin Hankyu hotels, hotels in the Tokyo metropolitan area (including remm ROPPONGI, which opened in March 2017)
Directly managed Hanshin Hankyu hotels, hotels in the Kinki area (including remm SHIN-OSAKA, which opened in September 2012, not including
hotels managed under contract)

1H
FY201815

Consolidated Statements of Income(Non-operating profit and loss)(¥ million)

1H FY2018
Results

1H FY2017
Results

Operating income

62,661

58,348+4,313Non-operating income

6,524

5,409

+1,114

5,082

4,082

+1,000

6,334

7,061

-727

5,115

5,802

-687

62,852

56,696+6,155Equity in income of affiliates

Non-operating expenses
Interest expenses

Ordinary income

Change16

Consolidated Statements of Income(Extraordinary profit and loss)(¥ million)

1H FY2018
Results

1H FY2017
Results

Extraordinary profit and loss

-274

-270

-3

Extraordinary income

9,294

1,514

+7,780Gain on contributions for construction

8,567

525

+8,041

Other

727

988

-261

9,569

1,785

+7,784

Loss on reduction of noncurrent assets

8,451

524

+7,926

Loss on valuation of investment securities

0

1,033

-1,033

Other

1,118

227

+890

Extraordinary loss:

Change17

Consolidated Statements of Income(Net income attributable to owners of the parent)(¥ million)

1H FY2018
Results

1H FY2017
Results

Income before income taxes

62,57756,426+6,151

Total income taxes

20,10017,130+2,970

Income taxes—current

17,95815,648+2,309

Income taxes—deferred

2,142

1,481

+660

42,47639,295+3,180

827

708

+119

41,64938,587+3,061

Net income
Net income attributable to noncontrolling interests

Net income attributable to ownersof the parent

Change18

Consolidated Balance Sheets
1H FY2018
Results

Net assets

Liabilities

Assets(¥ million)

FY2017
Results

Current assets

286,470

269,992

Noncurrent assets

2,095,024

2,079,839

Total assets
Current liabilities
Long-term liabilities

ChangeRemarks+16,478 Land and buildings for sale:+20,146+15,185 Investment securities:+12,016

2,381,495 2,349,831 +31,664
420,124
1,124,746

419,291
1,125,879+833-1,132

1H
FY2018Results

FY2017
Results

Debt

785,582788,931

Bonds

102,000

102,000-

Commercial paper

20,000-+20,000

Lease obligations
Interest-bearing debt

Total liabilities

1,544,871 1,545,171

Shareholders’ equity

786,534

759,875

Accumulated othercomprehensive income

32,336

27,074

Subscription rights to shares
Non-controlling interests

Total net assets

17,753

836,623-299

Change-3,349

7,978

8,591

-613

915,560

899,523+16,037

Accounts payable:-27,638
Long-term deferred contribution for construction:+8,111

Net income attributable to owners of theparent:+41,649+26,658 Less treasury stock, at cost:-10,743
Payment dividend:-4,389 etc.
Valuation difference on available-for-sale+5,262 securities:+4,792

496

-496

17,213+539

804,659 +31,963
19

Consolidated Statements of Cash Flows(¥ million)

1H FY2018
Results

1H FY2017
Results

39,16835,03625,940-23,145-18,332

25,813-12,343-15,980

Cash flows from investing activities-39,930-40,048

Purchases of noncurrent assets-53,682
16,267-51,778
12,925510

4,637-10,651-4,38916,037-5,216-4,413
13,828-69-320-1,709-2,084

22,530383
22,592

22,363648
20,927

Cash flows from operating activities
Depreciation and amortisation
Decrease (increase) in inventories
Income taxes (paid) refunded

Receipt of contributions for construction

Cash flows from financing activities
Purchase of treasury stock
Dividends paid

[Reference] Decrease (increase) in interest-bearing debt

Effect of exchange rate changes on cash and cash equivalents
Increase (decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of year
Increase in cash and cash equivalents from newly consolidated subsidiary
Cash and cash equivalents at end of year20

Ⅱ. Forecasts for fiscal 2018
(fiscal year ending 31st March2018)[Change from May forecasts]

21

Consolidated Statements of Income (Summary)(¥ billion)

FY2018
Forecasts

FY2018
Forecasts(As of Nov.)①(As of May)②

Revenues fromoperations

765.0

750.0

Operating income

104.0

96.0

Change①-②+15.0(+2.0%)+8.0(+8.3%)+9.0

Remarks

FY2017
Results③

Rise in the total number ofcondominium units sold andthe sale of commercial-use
land (Real Estate Business),strong performance of sports
and stage businesses(Entertainment andCommunications Business),strong performance among
the Hankyu and Hanshinlines (Railway Business)
The increase in operating
income shown above
coupled with a rise in equity
in income of affiliates

Change
①-③

736.8

+28.2

104.1

-0.1

100.6

+0.4

71.3

-5.3

101.0

92.0

66.0

60.0

Depreciation andamortisation

53.7

53.9

-0.2

52.8

+0.9

Financial balance ①-②

-8.9

-9.5

+0.6

-10.1

+1.2

Interest and dividend income①

1.3

1.1

+0.2

1.1

+0.2

Interest expense②

10.2

10.6

-0.4

11.2

-1.0

94.0

94.0

-

86.2

+7.8

Ordinary income
Net income attributable toowners of the parent(+9.8%)+6.0(+10.0%)(Reference)

Capital expenditure22Consolidated Statements of Income (Breakdown for each business segment)(¥ billion)[Upper table]
Revenues from operations[Lower table]
Operating income

Total

FY2018
Forecasts

FY2018
Forecasts(As of Nov.)①(As of May)
②

765.0

750.0

+15.0

736.8

+28.2

104.0

96.0

+8.0

104.1

-0.1

236.2

234.5

+1.7

237.1

-0.9

41.2

39.6

+1.6

42.2

-1.0

232.7

225.5

+7.2

215.7

+17.0

41.2

38.1

+3.1

42.0

-0.8

118.6

115.3

+3.3

115.2

+3.4

16.2

14.5

+1.7

15.7

+0.5

33.7

32.3

+1.4

29.9

+3.8

1.2

0.5

+0.7

0.6

+0.6

78.3

73.1

+5.2

71.7

+6.6

2.0

1.7

+0.3

1.6

+0.4

66.9

67.9

-1.0

65.6

+1.3

2.4

2.6

-0.2

2.8

-0.4

Change①-②Remarks

FY2017
Results③

Change①-③(Breakdown for each business segment)

Urban
Transportation
Real EstateEntertainment andCommunications
TravelInternational
Transportation

HotelsStrong performance among the Hankyu
and Hanshin lines (railway business)
A rise in the total number ofcondominium units sold and sale ofcommercial-use land
Strong performance in the sports andstage businesses
A rise in the number of visitors toEuropean destinations
Strong performance, particularly in airtransport, among subsidiaries in Japanand those in East Asia and Europe

Average daily rates fell short of theinitial projection

23

[Urban Transportation] Railway Performance Forecasts
Hankyu Corporation

Fare revenues (¥ million)*
FY2018
Forecasts(As of Nov.)

FY2017
Results

ChangePassenger volumes (Thousands)*
FY2018
Forecasts(As of Nov.)

FY2017
Results

ChangeCommuter pass33,12532,628+497(+1.5%)

333,604

329,305 +4,299(+1.3%)

Workers

28,632

28,138+493(+1.8%)

234,045

230,010 +4,035(+1.8%)

Students

4,492

4,489

+3(+0.1%)

99,55999,295

Other tickets

63,16862,720+447(+0.7%)

320,251

318,064 +2,187(+0.7%)

Total

96,293

95,348+944(+1.0%)

653,855

647,369 +6,486(+1.0%)

Hanshin Electric Railway
Fare revenues (¥ million)*
FY2018
Forecasts(As of Nov.)

FY2017
Results

Change+264(+0.3%)

Passenger volumes (Thousands)*
FY2018
Forecasts(As of Nov.)

FY2017
Results

ChangeCommuter pass

11,784

11,563+221(+1.9%)

121,796

119,768 +2,027(+1.7%)

Workers

10,56810,356+211(+2.0%)

96,26994,479 +1,789(+1.9%)

Students

1,216

1,206

+10(+0.9%)

25,52725,289Other tickets

21,46821,136+332(+1.6%)

118,575

116,998 +1,576(+1.3%)

Total

33,25332,699+553(+1.7%)

240,371

236,766 +3,604(+1.5%)+237(+0.9%)＊ Revenue amounts less than one million yen, and numbers of passengers less than one thousand, are omitted.
For Hankyu Railway, “other ticket revenue/ridership” includes revenue/ridership associated with the PiTaPa usage sections.
Sum of tier 1 and tier 2 railway operators for both Hankyu Corporation and Hanshin Electric Railway

24

Fiscal 2018 Management Indicators Outlook
FY2017
Results

FY2018
Forecasts

FY2018
Forecasts(As of May)(As of Nov.)

Operating income¥104.1billion¥96.0billion¥104.0billion

EBITDA※1¥159.3billion¥152.0billion¥160.0billion

Interest-bearing debt

¥899.5billion¥910.0billion¥900.0billion

Interest-bearing debt /EBITDA ratio

5.6times

6.0times

5.6times

D/E ratio※2

1.1times

1.1times

1.1times¥71.3billion¥60.0billion¥66.0billion

9.4%

7.5%

8.1%

¥875.3billion¥885.0billion¥875.0billion

5.5times

5.8times

5.5times

Net income attributable toowners of the parent
ROE(Reference)
Net interest-bearing debt※3
Net interest-bearing
debt/EBITDA ratio※1 EBITDA=operating income + depreciation expenses + amortisation of goodwill※2 D/E ratio＝interest-bearing debt / equity※3 Net interest-bearing debt=interest-bearing debt - cash and deposits
25

《Reference》 Trends in Operating Revenues and Operating Income
Revenues fromoperations

Operating income

Ordinary income

653.3

638.8

649.7

90.7

682.4

77.8
70.1
74.9

73.8
64.7

685.9

679.2

74.9

91.8

94.0

81.2

0.6
※１

FY200820.6
FY200910.8
FY2010

104.5

736.8

104.1
100.6

104.0
101.0

85.6

65.4
50.4

765.0

707.4 ※2

110.3
87.9

57.4

(¥ billion)

owners of the parent

752.3

683.7

Net income attributable to

70.0

71.3

FY2016FY2017

66.0

54.2
46.5

39.3

39.7

FY2012FY201346.4

18.1
FY2011FY2014※1 Includes Department Store Business (consolidated up to the first half of fiscal 2008).

FY2015FY2018

Forecasts(As of Nov.)※2 As of fiscal 2017, the presentation of revenues from operations of the International Transportation Business has changed from net togross amounts.

26

《Reference》 Consolidated Statements of Capital Expenditure(¥ billion)

FY2018
Forecasts

FY2018
Forecasts(As of Nov.)(As of May)①②

Change①-②

FY2017
Results③

Change
①-③

94.0

94.0

-

86.2

+7.8

Urban Transportation

38.5

38.5

-

31.2

+7.3

Real Estate

44.1

44.1

-

43.1

+1.0

Entertainment andCommunications

9.8

9.8

-

7.4

+2.4

Travel

0.9

0.9

-

0.5

+0.4

International Transportation

0.7

0.7

-

0.4

+0.3

Hotels

3.1

3.1

-

3.2

-0.1

Total capital expenditure(Breakdown for each business segment)27

《Reference》 Consolidated Statements of Depreciation and Amortisation, EBITDA(¥ billion)

FY2018
Forecasts

FY2018
Forecasts(As of Nov.)(As of May)①②

Change①-②

FY2017
Results③

Change
①-③

53.7

53.9

-0.2

52.8

+0.9

Urban Transportation

27.0

26.9

+0.1

25.9

+1.1

Real Estate

16.5

16.7

-0.2

16.8

-0.3

Entertainment and Communications

7.0

7.2

-0.2

6.7

+0.3

Travel

0.7

0.7

0.7

-0.0

International Transportation

0.7

0.8

0.7

+0.0

Hotels

2.1

2.1

1.9

+0.2

160.0

152.0

+8.0

159.3

+0.7

Urban Transportation

68.2

66.6

+1.6

68.2

+0.0

Real Estate

57.7

54.8

+2.9

58.8

-1.1

Entertainment and Communications

23.3

21.8

+1.5

22.6

+0.7

Travel

1.9

1.2

+0.7

1.4

+0.5

International Transportation

2.7

2.5

+0.2

2.3

+0.4

Hotels

4.5

4.7

-0.2

4.7

-0.2

Total Depreciation and amortisation(Breakdown for each business segment)

Total EBITDA-0.1-(Breakdown for each business segment)

28

Ⅲ. Referential Materials

29

Consolidated Subsidiaries(As of September 30th, 2017)
Urban Transportation
Railway
Hankyu Corporation
operations
Hanshin Electric Railway
Nosé Electric Railway
Kita-Osaka Kyuko Railway
Hokushin Kyuko Railway
Kobe Rapid Transit Railway
Hankyu Hanshin Electric System
Hankyu Railway Service
Automobile
Hankyu Bus
Hanshin Bus
Hankyu Kanko Bus
Osaka Airport Transport
Hankyu Denen Bus
Hankyu Taxi
Hanshin Taxi
Osaka Hanshin Taxi
Hankyu Hanshin Motor Technology
Hankyu Driving School Hattori Ryokuchi

Haks Hanshin
Retailing
Advertising
Other

Eki Retail Service Hankyu Hanshin

Hankyu Style Labels
Hankyu Advertising Agency
Alna Sharyo
Hankyu Sekkei Consultant
Hanshin Station Net
Hanshin Sharyo MaintenanceReal Estate
Real estate

Hankyu Corporationleasing and sales Hanshin Electric Railway
Hankyu Realty
Hanshin Real Estate
Osaka Diamond Chikagai
KyokutoHankyu Hanshin Building Management
Other
Hankyu Hanshin High Security Service

Hankyu Hanshin Clean Service
Hankyu REIT Asset Management
Hankyu Investment Partners
Hankyu Housing Support
Entertainment and Communications
SportsHanshin Electric Railway
Hanshin Tigers Baseball Club
Hanshin Contents Link Corporation

Wellness Hanshin
P & P Hamamatsu
Stage
Hankyu Corporation
Takarazuka Creative Arts
Takarazuka Stage
Umeda Arts TheaterCommunication Bay Communications
and media Hanshin Cable Engineering
Leisure, etc.
Itec Hankyu Hanshin
System Giken
Mt. Rokko Cable Car & Tourism
YMIRLINK
Himeji Cable Television
RworksTravelTravel agency

Hankyu Travel International
Hankyu Hanshin Business Travel
Hankyu Travel Support
Hanshin Travel International
International Transportation
International
Hankyu Hanshin Express
transportation Hankyu Hanshin Logipartners
HANKYU HANSHIN EXPRESS(USA, UK, NETHERLANDS, SINGAPORE
DEUTSCHLAND,HONG KONG,
THAILAND,PHILIPPINES, MALAYSIA,VIETNAM,SHANGHAI,GUANGZHOU,BEIJING,TAIWAN, KOREA,INDIA,
INDONESIA, Southeast Asia, HANKYU
INTERNATIONAL LOGISTICS SHANGHAI,:19Companies）
HotelsHotel
Hankyu Hanshin Hotels
management Hanshin Hotel Systems
Hankyu Hanshin Restaurants
Arima View Hotel
Amanohashidate Hotel
Kure Hankyu Hotel【Legend】
Name of segment
Name of
Name of consolidated subsidiary(Only listed companies that are
sub-segment
managed as segment)

30

Revenues from Operations and Operating Income as a FY2017
management composition

earnings structure(As of September 30th, 2017)

Hankyu Hanshin Holdings

 The Urban Transportation and Real Estate businesses

HotelsInternational
Transportation

TravelEntertainment andCommunications

Real Estate

Urban
Transportation

generate stable cash flows and account for
approximately 60% of revenues from operations and
80% of operating income.
Revenues from operations breakdown(FY2017)
Consolidated Total

Operations¥736.8billion

Operating Income¥104.1billion

Operating income margin

Hotels
Revenues from

Revenues from Operations

Urban Transportation¥65.6billion

Operating Income¥2.8billion

Operating income
margin4.3%

International
Transportation
Hankyu Corporation

Hanshin Electric Railway

HankyuTravelInternational

HankyuHanshin
Express

HankyuHanshinHotels

Revenues fromoperations¥71.7billion

Operating income¥1.6billion

Operating income
margin2.2%¥29.9billion

Operating Income¥0.6billion

Operating income
margin2.0%

Revenues fromOperations¥237.1billion

Operating Income¥42.2billion

Operating income
margin17.8%

Real Estate

TravelRevenues fromOperations

14.1%

Revenues fromOperations¥215.7billion

Operating Income¥42.0billion

Operating income
margin19.5%

Approximately

60%
Entertainment & Communications
Revenues fromOperations¥115.2billion

Operating Income¥15.7billion

Operating income
margin13.6%

31

Areas Served by the Hankyu and Hanshin lines①
Definition of the areas served by the Hankyu and Hanshin lines
Osaka Prefecture:
Osaka City (Fukushima, Konohana, Nishi, Naniwa, Nishi-Yodogawa, Higashi-Yodogawa, Yodogawa,
Kita and Chuo, out of a total of 24 wards); and Toyonaka, Ikeda, Suita, Takatsuki, Ibaraki, Minoh,
Settsu cities and Shimamoto town
Hyogo Prefecture:
Kobe City (Higashi-Nada, Nada, Hyogo, Nagata and Chuo, out of a total of 9 wards); andAmagasaki, Nishinomiya, Ashiya, Itami, Takarazuka and Kawanishi cities
Kyoto Prefecture:
Kyoto City (Nakagyo, Shimogyo, Ukyo, Nishikyo, out of a total of 11 wards); and Muko andNagaokakyo cities and Oyamazaki town

32

Areas Served by the Hankyu and Hanshin lines②
Population Trends

Sources: Prepared by the Company based on data from “Local Economy Directory,” published by Toyo Keizai, Inc.,and “Basic Resident Register,” published by the Ministry of Internal Affairs and Communications.
（k㎡） (thousand)

107.0

Area

2017

106.0

1,318

5,599

105.0

Osaka Pref. (service areas)

449

2,661

Hyogo Pref. (service areas)

471

2,270

Kyoto Pref. (service areas)

398

668

Non-Hankyu/Hanshin Service Areas

26,033

14,812102.0

Osaka Pref. (non-service areas)

1,456

5,986

101.0

Hyogo Pref. (non-service areas

7,930

3,236

100.0

Kyoto Pref. (non-service areas)

4,214

1,847

Shiga Pref.

4,017

1,395

Nara Pref.

3,691

1,369

98.0

4,725

979

97.0

27,351

20,411

Areas served by the Hankyu/Hanshin line

Wakayama Pref.
Total

Areas served by the Hankyu and Hanshin lines
Kansai
Osaka Pref.

Hyogo Pref.
Kyoto Pref.

104.0
103.0

（1991=100）

99.0

Survey of prospective condominium purchasers regarding
their preferred Kansai residential area, conducted in fiscal 2018
Ranking Station（Area）

Ranking Station（Area）

11

Ashiya（Ashiya, Hyogo Pref.）1

Nishinomiya-kitaguchi（Nishinomiya, Hyogo Pref.）2

Shukugawa（Nishinomiya, Hyogo Pref.）12

Toyonaka（Toyonaka, Osaka Pref.）3

Okamoto（Kobe, Hyogo Pref.）13

Kuraku-enguchi（Nishinomiya, Hyogo Pref.）

4

Umeda

（Kita-ku, Osaka）

14

Fukushima（Fukushima-ku, Osaka）

5

Ashiyagawa（Ashiya, Hyogo Pref.）

15

Kobe

（Kobe, Hyogo Pref.）6

Mikage（Kobe, Hyogo Pref.）16

Kobe-sannomiya（Kobe, Hyogo Pref.）7

Takarazuka（Takarazuka, Hyogo Pref.）

17

Esaka

（Suita, Osaka Pref.）8

Senri-Chuo（Toyonaka, Osaka Pref.）18

Hommachi（Chuo-ku, Osaka）

9

Osaka

（Kita-ku, Osaka）

19

Kitahama（Chuo-ku, Osaka）

10

Tennoji（Tennoji-ku, Osaka）

20

Nakatsu（Kita-ku, Osaka）

Except for Tennoji (10),Hommachi (18), andKitahama (19), all of the
top 20 stations are on
Hankyu Hanshin Holdings
group lines

Source: A survey of prospective condominium purchasers regarding their preferredresidential area, conducted by seven major real estate developers (Sumitomo Realty& Development Co., Ltd., Daikyo Incorporated, Tokyu Land Corporation, Tokyo Tatemono Co., Ltd., Nomura Real Estate Development Co., Ltd., Mitsui Fudosan
Residential Co., Ltd., and Mitsubishi Jisho Residence Co., Ltd.) and included in a press release dated September 28th, 2017.

33

Overview of Umeda Area①
Major rental properties
Property nameLeasable area
(1,000㎡) ※1

Umeda Hankyu Bldg.

（as of October, 2017)

Number of floors

Completed213

41 floors above groundand 2 below ground

2012

82

40 floors above groundand 5 below ground

1997

55

28 floors above groundand 4 below ground

2004

52

34 floors above groundand 3 below ground1992

Umeda Hanshin
Daiichi Bldg.
(HERBIS OSAKA)）
Umeda Hanshin Daini
Bldg.
(HERBIS ENT)
Hankyu Chayamachi
Bldg.
(Applause Tower)
Hankyu Sanban Gai
Shopping Centre
Hankyu Grand Bldg.
GRAND FRONTOSAKAHankyu Terminal
Bldg.
Hankyu Five Bldg.
(HEP FIVE) ※2

5 floors above groundand 2 below ground
32 floors above ground36
and 3 below ground
38 floors above ground28
and 3 below ground
18 floors above ground27
and 4 below ground
10 floors above ground20
and 3 below ground40

10 floors above groundand 2 below ground
9 floors above ground
NU chayamachi
12
and 2 below ground※1：Leasable area does not include areas for public use※2 Jointly owned property with Hankyu REIT,Inc.
Navio Hankyu(HEP NAVIO)）

16

1969
1977
2013
1972
1998
1980
2005

Developments in Umeda district(red = Hankyu Hanshin Holdings group related Projects)① Umeda 1-1 Project（Dai Hanshin Building and Shin Hankyu Building Rebuilding Project）② (Provisional Name) Yodobashi Umeda Tower-Yodobashi Camera Co., Ltd.

③ (Provisional Name) Umeda 3-chome Project- Japan Post Holdings Co. Ltd.,/Osaka Terminal Building Co., Ltd.

④ (Provisional Name) Umeda Sonezaki Projest-Sumitomo Realty & development Co., Ltd.

⑤ Chayamachi B-2 District Redevelopment Project-TOKYU LAND CORPORATIONCo., Ltd.

34

Overview of Umeda Area②
Trends in rent amongsix main business districts in Osaka

Trends in average vacancy rates amongsix main business districts in Osaka
（%）
18.00

（¥/3.3㎡）
20,00016.00
18,00014.00
16,000

12.00
10.00

14,0008.00
12,0006.00
10,000

4.00
2.00

2012

2013

2014

2015

Osaka business areas (all)Minamimorimachi area
Senba area
Shinosaka area
(%)

2016

2017

8,000

2012

Umeda area
Yodoyabashi-Honmachi area
Shinsaibashi-Namba area
Tokyo business areas (all)

2012

2013

2014

2015

2016

2017

2013

2014

2015

Osaka business areas (all)Minamimorimachi area
Senba area
Shinosaka area(¥/3.3㎡)

2012

2016

2017

Umeda area
Yodoyabashi-Honmachi area
Shinsaibashi-Namba area
Tokyo business areas (all)
2013

2014

2015

2016

2017

Osaka business areas (all)

9.51

9.79

8.14

8.12

5.79

3.83 Osaka business areas (all)11,344 11,271 11,120 11,135 11,061 11,187

Umeda area

6.12

9.47

7.67

6.76

4.33

2.38 Umeda area

14,332 14,402 13,977 14,189 14,210 14,487

10.33

8.40

5.79

5.45

6.33

5.77 Minamimorimachi area

9,522

9.67

9.58

8.46

9.37

6.02

3.91 Yodoyabashi-Honmachi area

11,152 11,054 11,009 10,976 10,891 10,994

Minamimorimachi area
Yodoyabashi-Honmachi area

9,690

9,446

9,376

9,291 9,249

16.35

13.20

10.86

10.22

7.79

6.11

Shinsaibashi-Namba area

8.80

7.22

5.35

8.77

8.33

3.39 Shinsaibashi-Namba area

12,392 12,361 12,312 12,110 11,833 11,725

Shinosaka area

9.27

8.41

7.22

6.64

5.46

4.38 Shinosaka area

10,488 10,219 10,143 10,113 10,152 10,140

Tokyo business areas (all)

8.90

7.90

5.65

4.53

3.70

3.17 Tokyo business areas (all)16,675 16,230 16,805 17,594 18,336 18,995

Senba area

Senba area

9,950

9,810

9,651

9,663

9,521 9,717(Comparison of average rents in September of respective years)
Source: Miki Shoji, “Office Data.”

35

Progress on the Development of International Culture Park ‘Saito’ (a new town)• Since the opening of the western area of Saito in Spring 2004, progress has been made in
developing residential facilities and attracting commercial tenants in the western area. Saito has
developed into a new town, with a residential population of 14,000 and a facility population of 2,500.
• In Spring 2016, the central area was opened up for common use. There are several large-scale
logistics centres in the area, and construction operations are underway in other commercial lots.
• As for the eastern area, in February 2015, Ibaraki City altered the plan for prior areas (Sanroku Line
area and central-east area), and in May of the same year, the Group received permission to conduct
development operations. The Group soon became the leading organisation in the Sanroku Line area,
and it commenced construction operations in November 2015. We plan to develop the land that isallocated for large-scale commercial use, envisaging lots for distribution centres, and manufacturing
and processing facilities. We aim to open part of the area for common use in fiscal 2019.
Ibaraki-Sendaiji IC

Residential population in western area
（as of August,2017）

Shin-Meishin Expressway

Saito

Minoh
City

Ibarakicity

Number ofhouseholds

2,056

2,737

4,793

Current
population

6,270

8,262

14,532

population/
Number ofhouseholds

3.04

3.01

3.03

central-east area

Sanroku Line area

Total

Size of each area

Size

Western
area

Centralarea

Easternarea

312.6ha62.5ha367.5ha36

Global Network（International Transportation）【Initiatives of International Transportation Business】
・ Strengthening business development in Africa
・ Strengthening business in Asia
・ Expansion of business operations through the・ Construction of new logistics centres
Greater Europe Section, which includes the・ Further expansion of the network
Johannesburg and Dubai bases◆Establishment of new base in India
In July 2017, we opened a sales base in the Neemrana / Bawal area, forwhich we used to conduct sales activities from our headquarters in Delhi. By
strengthening our sales network, we aim to develop new business in the area,
which has the highest concentration of Japanese companies in northern India.

Number of bases: Japan=46, Overseas=119（as of July 1th, 2017）◆Construction of new logistics
centres in the ASEAN region
Following on from the 2016 opening of alogistics centre in Indonesia, in May 2017
the Group opened its largest logistics centrein Singapore, which has major advantages
as an international logistics hub.
The new logistics centre conducts highvalue-added operations, handling electronic
components, medical equipment,
pharmaceuticals, and other products ofSingapore’s priority industrial fields.

◆Strengthening of business development in East Africa
In June 2017, the Group sent an employee to an affiliated agency in Nairobi, Kenya. In coordination with thepersonnel of our representative office in Johannesburg, South Africa, these employees will step up businessdevelopment in East Africa—a region into which growing numbers of Japanese companies are making forays.

37

Hotel network of the Hankyu-Hanshin-Daiichi Hotel Group
Directly managed hotels (Hankyu Hanshin Hotels) 19Hotels 4,933 rooms
Other (franchises, etc.)

29Hotels 5,760 rooms

48Hotels
10,693 rooms（as of October 1th, 2017）

・The numbers of hotels and rooms do not include the Ritz-Carlton Osaka (Kita-ku, Osaka City, 291 rooms).

Directly managed hotels
Dai-ichi Hotel Tokyo
Dai-ichi Hotel Annex
Daiichi Hotel Tokyo Seafort
Kichijoji Dai-ichi Hotelremm HIBIYA
remm AKIHABARA
remm ROPPONGIHotel Hankyu International
Hotel new Hankyu Osaka
Hotel new Hankyu Annex
Hotel Hanshin
Umeda OS hotel ※remm SHIN-OSAKA
Senri Hankyu Hotel
Hotel Hankyu Expo Park
Takarazuka Hotel
Rokkosan Hotel ※Hotel new Hankyu Kyoto
remm KAGOSHIMA

Ours Inn Hankyu
Ginza Creston
Dai-ichi Hotel Ryogoku
Dai-ichi Inn Ikebukuro
Dai-ichi Inn Shonan
Toyama Dai-ichi Hotel
Dai-ichi Inn Shinminato

Hotel Concorde Hamamatsu
Tokyo Dai-ichi Hotel Nishiki
Hotel Boston Plaza Kusatsu
Hotel Royal Hill Fukuchiyama
Amano Hashidate Hotel
Osaka Dai-ichi Hotel
Arima View Hotel urara

Kyoto,
Osaka,
京阪神
Kobe

11

1

Maniwa Riverside Hotel
Kure Hankyu Hotel
Hotel Ichibata
Tokyo Dai-ichi Hotel Shimonoseki

Takamatsu Kokusai Hotel
JR Hotel Clemant Tokushima

Other(franchises, etc.)

JR Hotel Clement Takamatsu

Tokyo Dai-ichi Hotel Iwanuma Resort

The Crown Palais New Hankyu Kochi

Tokyo Dai-ichi Hotel Tsuruoka
Tokyo Dai-ichi Hotel Yonezawa

Tokyo Dai-ichi Hotel Matsuyama

Tokyo Dai-ichi Hotel Shin-Shirakawa

Takakura Hotel Fukuoka

Imabari Kokusai Hotel※Hankyu-Hanshin Hotels are entrusted operation

Tokyo
東京地区
東京地区
・直営 7

5

・その他4

3

38

〔Others〕①Long-Term Management Vision for 2025 (Fiscal 2026)
and Medium-Term Management Plan
(Reproduced from the results briefing materials
released in May 2017)39

Breakdown by Business Area and Business Model
Umeda and line-side stock businesses make up 2/3 of the Group’s overall operating
income. When combined with flow businesses, they make up around 90%.
Tokyo metropolitan area
and overseas markets

Tokyo metropolitan area
and overseas markets x
stock businesses

flow businesses

Warehouse possession(Logistics)

International
Transportation

Real estateleasing

Stage

Real estatesales

HotelsSportsCM(information
services )TravelUmeda and line-side
areas

Urban
Transportation

Stage

Real estate
salesSportsCM(information
services )CATVTravelUmeda and line-side areas x
stock businesses

Stock(Use assets)

Tokyo metropolitan
area and overseas
markets x
stock businesses

Tokyo metropolitan
area and overseas
markets x
flow businesses

Umeda and line-side
areas x flow businesses

FY2017¥104.1 Billion
Umeda and line-side
areas x stock businesses

Real estateleasing

Hotels【Breakdown of operating income by businessarea and business model】

Flow(non-assets)

2/3 of the Group’s
overall operating
income【stock businesses】
Businesses that hold or use stock (property
and other fixed assets)【flow businesses】
Businesses that, instead of holding largescale stock, use business know-how,human resources, brand assets, and otherintangible assets
40Anticipated Changes in the External Environment (threats)
Japan’s population is set to decline rapidly, particularly from 2025, andpopulation aging will continue apace for the next 25 years.
National Institute of Population and Social Security Research,‘Regional Population Projection for Japan’ [Nihon no chi’iki
betsu shōrai suikei jinkō]
Based on middle trends of ‘Population Estimates (2012)’

Population Projections for 2025 and2040 (as compared to 2015)(year)
Total population
Working-age population(age 15 to 64）

people over 65 years old

Kansai area※1

Tokyo metropolitan
area※2

2025

2040

2025

2040

2025

2040

-5％

-16％

-2％

-10％

-5％

-15％

-7％

-25％

-4％

-21％

-8％

-25％

＋6％

＋13％

＋10％

＋29％

＋8％

＋14％

The population level will decline from its present
level of over 18 million to around 15 million.

Japan※1:Comprises the prefectures of Osaka, Kyoto, Hyogo, and Nara
※2:Comprises the Tokyo metropolitan area and the prefectures of
Kanagawa, Saitama, and Chiba

 There will be fewer consumers of the Group’s
products and services (shrinking market).
 With more women and elderly people working,there will be shorter consumption times (leisure times).
 The tightening labour market will makeit harder to secure a workforce.

→ Decline in sales→ Increase in costs

The Group’s various businesses will not escape the impacts of these changes.
41

Anticipated Changes in the External Environment (opportunities)
Potential ofline-side areas

Our line-side areas are in a relatively advantageous position compared to other line-side areas
in Kansai as they are relatively close to Shin-Osaka Station and the international gateways(Kansai International Airport, Osaka International Airport, and Kobe Airport). Also, new rail
links are being planned and motorways are being developed.

Greater inbounddemandThe government aims to attract 40 million foreign visitors a year by 2020, and 60 million ayear by 2030, with the hope that they will spend ¥15 trillion annually by 2030 (four times thefigure for 2015).

Concentration of
population into
urban areas

Tokyo’s five central business districts (Chiyoda, Chuo, Minato, Shinjuku, and Shibuya) areprojected to retain their population levels as far into the future as the 2040s.

Growth in Asia

In ASEAN countries, population growth and high economic development are projected tocontinue.

Technologicalinnovation

There will be large leaps forward in artificial intelligence (AI), the Internet of Things (IoT), andother technologies, all of which have the possibility to significantly transform society.

These changes present new business opportunities
 There are new opportunities for line-side areas and Umeda in particular. Until
now, Umeda has been regarded as the centre of Kansai. With the growth of
ASEAN countries, Umeda has the potential to become the centre of Asia.
 There are opportunities for the Tokyo metropolitan area and overseas markets.
The Company can further strengthen the line-side businesses it has built up overmany years and develop its know-how.
 By proactively utilizing AI, IoT, and other new technologies in its businesses, we
can control costs, resolve personnel shortages, and replace existing businessmodels, leading to new growth opportunities.

42

The Company’s Long-Term Management Vision
Mission : What we try to achieve
By delivering “Safety and Comfort” and “Dreams and Excitement” ,we create satisfaction among our customers and contribute to society.

Values : What is important to us
Everything we do is for the customer. That’s where it all
starts.
Sincerity
Gain customers’ confidence by always being sincere.
Foresight &With our pioneer spirit and flexible thinking, we create a new
Creativity
value.
Respect for People Everyone is absolutely invaluable to the Group.
Customers FirstGroupManagement
Philosophy

Long-term
VisionMedium-term
management
Plan

To clarify the kind of company we hope to be as well as thebasic approach and strategies for achieving this vision, we
have formulated a vision for 2025 (fiscal 2026).
This is the year when stable operations are set to commence inthe Umeda 1-1 Project (construction to be completed in spring2022), a project that we are pursuing as a symbol ofmanagement integration. The vision also includes an outlook forthe 2040s, when demographic changes will have had a major
impact on business.
The medium-term management plan sets out specificaction plans for medium-term projects.
(Please see pages 51 to 52 for details on the new medium-term
management plan)
43

The Company We Hope to be in the Long-Term (overall vision)
Slogan for the Hankyu Hanshin Holdings Group Long-Term Management Vision for 2025 (fiscal 2026) is:‘Enhancing line-side areas and expanding fields’
Sustainably enhance corporate value
Enhance daily life
(customer) value
Regarding these socioculturalchanges as business
opportunities, we will provide
innovative products and services
through our business operations.

Umeda and line-side areas
x stock businesses

Make our railway theabsolute best among the
Kansai networks.

Strategy①

Enhance social value
Build relationships of trustwith various stakeholders,meet their expectations, andcontribute to society.

Enhance economicvalue
We will strive to maintain andimprove our profitability andfinancial soundness as a topclass private railways
operator.

Tokyo metropolitan area and overseas
markets x stock businesses

flow businesses

Strengthen competitiveness by
Construct a stable revenue base in thoroughly pursuing brandthe Tokyo metropolitan area andoptimisation and differentiation.
overseas markets.
Strategy③(diversify the portfolio, which is currently
concentrated in Umeda and line-side areas).

Strategy②Groupwide initiatives,
new business fields, etc.

Make greater use of the Group’s collective strength and develop new
business fields.
Strategy④
The coming age of fullscale population decline

Further technologicaladvances (AI, IoT, etc.)

Economic growthin Asia

Declining birth rate
and aging population

Crumbling infrastructure

Improvements to public transport
Growing numbers of infrastructure (airports, rail andmotorway networks)
overseas visitors

Tightening oflabour market
Concentration of
population into
urban areas

Opportunity for Kansai to develop its position as gateway for Asia and the wider world
44

The Company We Hope to be in the Long-Term(Umeda and line-side areas x stock businesses)

The company we hope to be

Make our railway the absolute best among the Kansai networks.
We aim to increase the resident and non-resident population of line-side areas.
To this end, we will channel into these areas the dynamism of the TokyoStrategy
Nagoya-Osaka axis and the power of Asia and other regions of the world,①
attract new industries and cutting-edge technologies ahead of othercompanies, and support efforts to develop thriving local communities.
Business environment analysis• Umeda and line-side areas will remain the Group’s most important revenue base.
• Given that the numbers of overseas visitors are set to rise, there is an urgent need to channel the
dynamism of the Tokyo-Nagoya-Osaka axis and the power of overseas regions into the line-side
areas.
• There are medical and industrial clusters with potential to develop, including KOBE Biomedical
Innovation Cluster, Umekita Phase II Development Project, and Nakanoshima (hub for globalising
regenerative medicine).

Measures the Company will pursue
 We want Umeda to become an area that capitalises on the economic growth of ASEAN countries
and inbound demand, attracts new industries, and connects to and from the Tokyo-Nagoya-Osakaaxis and international airports. To this end, we will pursue plans for rail links (including a ShinOsaka rail link) and strategic rebuilding projects in the area (including the Umeda 1-1 Project).
 Focusing on the compact city concept, we will leverage innovative technology and the know-how
of our partners to introduce highly convenient services into line-side areas, making these areas
attractive places to live in. We will also help develop communities that are safe, secure, and havethriving educational and cultural facilities. In connection with these efforts, we will also redevelop
and renovate our key line-side bases.
45

The Company We Hope to be in the Long-Term(Tokyo metropolitan area and overseas markets x stock businesses)

The company we hope to be
Construct a stable revenue base in the Tokyo metropolitan area and overseas markets(diversify the portfolio, which is currently concentrated in Umeda and line-side areas).

Our property portfolio is currently concentrated in Umea and line-side areas.
Strategy To compensate for downsizing in the Kansai area, we will diversify our②property profile by acquiring additional assets including rental property inTokyo’s large market and in overseas markets that are set to grow.
Business environment analysis• Currently, our stock is primarily in the Umeda and line-side areas. Given the potential for
demographic fluctuations, we must duly consider the risks associated with such a concentrated
portfolio.
• Tokyo’s five central business districts will remain largely unaffected by the population decline as far
into the future as the 2040s.
• The world population is expected to increase significantly, particularly in Asia.

Measures the Company will pursue
 In the Tokyo metropolitan area, we will steadily accumulate stock in the centre of the capital(generally speaking, the five central business districts) while monitoring market conditions.
(Target: Real estate leasing business to acquire an asset size of approximately ¥200 billion)
 Regarding overseas stock (real estate), our basic policy is to capitalise on economic growth in
ASEAN countries. Accordingly, we will focus primarily on developing logistics centres in ASEAN. At
the same time, we will develop commercial facilities on a trial basis and ascertain the potential foraccumulating stock.

46

The Company We Hope to be in the Long-Term(Flow businesses)

The company we hope to beStrengthen competitiveness by thoroughly pursuing brand optimisation and differentiation.
Thoroughly optimise the Hankyu Hanshin brand value and differentiate theStrategy
products and services from the competition so as to strengthen competitive③
edge and achieve further business expansion.
Business environment analysis••

The entertainment businesses (sports and stage) have content that is unique to the Group andhigh brand value.
Flow businesses such as real estate sales, communication and media (information services),travel, and international transportation are exposed to competition because the barriers toentry are low.

Measures the Company will pursue

 In the highly competitive entertainment businesses, we will engage in new challenges andinitiatives with a view to further refining and elevating brand value.
 In the real estate sales business, we will gradually expand operations in the Tokyo metropolitan area
and overseas markets.
(we aim to raise condominium and detached house sales in the Tokyo metropolitan area to the level of
those in the Kinki area [condominiums: approximately 800 units a year; detached houses:
approximately 100 units a year].) In flow businesses such as communication and media (information services), travel, andinternational transportation, we will monitor competitiveness and strengthen business operations
with a view to differentiating ourselves from the competition (this may entail expanding businessscale or revising the business portfolio or model, etc.)
47

The Company We Hope to be in the Long-Term(Group-wide initiatives, new business fields, etc.)

The company we hope to be
Make greater use of the Group’s collective strength and develop new business fields.
In addition to pursuing Group-wide initiatives, we will introduce cutting-edge
Strategy technologies into existing businesses, venture into new business fields, andthereby provide culturally enriched and innovative lifestyle options.
④
・In this increasingly competitive business environment, we cannot beat the competition andachieve growth without leveraging the Group’s collective strength.
・Amid the changing social environment, we must seize the opportunities for developing new
business fields.
Changes in the social environment(demographic change, technological innovation, lifestyle changes, diversification of values, etc.)(1) Use existing resources to pursue Groupwide initiatives[e.g. credit and point card measures, development of overseas logistic
centres by International Transportation and Real Estate core companies]

stockbusinesses

flowbusinesses(2) Rejuvenate Group assets and utilise human resources[develop the domestic logistics and real estate businesses in tandem with thedevelopment of public transport infrastructure, introduce the proposal
systems for new businesses into the Group as a whole](3) Explore the potential for utilising cutting-edge
technologies throughout the Group[use IoT sensor technology to save labour in site inspection processes]
48

The Company We Hope to be in the Long-Term(Management Indicators)

We will pursue the four strategies with a view to achieving the following targets as of2025 (fiscal 2026). Achieving these targets will keep us on course for maintaining atleast the current levels of operating income in the 2040s, when demographic changes
will have had a major impact on business.

Management Indicators

Targeted figure for 2025
(FY2026)

operating income¥120 billion

EBITDA¥200 billion

Interest-bearing debt
/EBITDA ratio

Between5 and 6 times

Profitability

Financialsoundness

・Ensure that we will be one of the most profitable private railway operators
in 2025 (fiscal 2026).
・While accelerating growth investment, ensure that we remain one of themost financially sound private railways operators.
49

Organisational Improvements for Achieving the Long-Term Vision
We will implement the following organisational improvements to help the Grouppursue the strategies and measures necessary for achieving our long-term vision.
①Integrate Hankyu Corporation (HC) and Hanshin Electric Railway (HER)’s business-field
exploration efforts into the Group as a whole (to be implemented in April 2017) As part of our long-term vision, we aim to make greater use of the Group’s collective strengthand develop new business fields. To this end, we will develop a harmonised framework forplanning new business ventures on a Groupwide basis so as to streamline the process ofdeveloping new businesses.
②Consolidate HC and HER’s real estate business divisions with a view to establishing a realestate-oriented core company (April 2018 is tentatively proposed as the date for implementation)
 As part of our long-term vision, we aim to strengthen and expand the real estate leasing
business in all areas and thoroughly differentiate the real estate sales businesses and otherbusinesses. To this end, we will consolidate the Real Estate core business (including HC & HER’s
real estate divisions) into a new real estate core company, capitalise on the Group’s collective
real estate prowess, and pursue growth-oriented initiatives faster and more effectively.
※See page 53 for more details on the reorganisation.

〈Reference〉 Post-reorganisation schema
Hankyu Hanshin Holdings
HankyuCorporation

Hanshin Electric
Railway

Hankyu Hanshin
RealtyHankyu Travel
International

Hankyu Hanshin
Express

Hankyu Hanshin
Hotels50

Framework of the Medium-Term Management
Business In addition to developing foundations for medium-to-long-term growth, use
strategies the period to take the first steps toward achieving the long-term vision.
①Further strengthen the stock businesses in the Umeda and line-side areas(e.g. railways, real estate leasing, media and communications, hotels)②Accumulate stock in the Tokyo metropolitan area and overseas markets③Increase competitiveness of flow businesses(real estate sales, sports, stage, information services, travel, and international transportation)④Make greater use of the Group’s collective strength and venture into new business fields

Financial To achieve the long-term vision, we will prioritise growth investments understrategies 1 to 4 with a view to further increasing operating income and EBITDA.
policy・However, the financial standing will not be neglected; we will aim to maintain our financial soundness.
Regarding financial soundness benchmarks, since we will pursue growth investment under the four
long-term strategies, we will in future prioritise interest-bearing debt/EBITDA ratio over interestbearing debt as a benchmark for financial soundness.
・Returns to shareholders, we will aim to further increase the annual dividend per share for fiscal 2018
onward. (see page 52)

Forward-looking investment
While striking a balance with financial soundness, wewill prioritise growth investment under strategies 1 to 4.

Maintaining financial soundness
Prioritise the interest-bearing debt/EBITDA ratio
over the interest-bearing debt as a benchmark forfinancial soundness.

Returns to shareholders
For the period of the plan, we envisage atotal payout ratio of 30% for fiscal 2018 and51
onward.

Framework of the Medium-Term Management
Capital investment (including lending) in fiscal 2016-2019

Approx. ¥390 billion
Investment in major
development projects and newmarket development

Approx. ¥170
billionInvestment in maintenanceand renewal of existing
infrastructure

Approx.
¥220 billion

Approx.
60％
Approx.

40％

Strategy①
Further strengthen the stock businesses
in the Umeda and line-side areas
Strategy③
Increase competitiveness offlow businesses■Umeda andline-side areas■Tokyo metropolitan
area and overseas
markets

Strategy②
Accumulate stock in the Tokyo metropolitan area andoverseas markets

Returns to Shareholders
Shareholder Return Policy: Pay stable annual dividends and acquire treasury stock- The Group’s performance has been stable recently, and we have met our benchmark for financial
soundness over the medium-to-long term (interest-bearing debt/EBITDA ratio between 5 and 6
times) for two years running. Accordingly, from fiscal 2018 onwards we plan to raise the annual
fiscal dividend from ¥35 to ¥40 per share. Alongside this change, we aim to further enhance
returns to shareholders by increasing the total payout ratio from 25% to 30%.
<Reference> Formula for calculating total payout ratio※Total payout ratio of FY[N](％)=(Total dividend of FY[N])+(Acquisition of treasury stock in FY[N+1])(Net income attributable to owners of parent in FY[N])

× 100

52

《Reference》 Reorganisation of the Real Estate Business(based on notice released on 2 November 2017)■Outline of reorganisation<Present structure>

Hankyu Hanshin Holdings【Scheduled date of implementation】
・April 1, 2018

【Details of reorganisation】
Hanshin Electric
Railway

HankyuCorporation
Hankyu Realty<First Phase>
Hankyu Hanshin Holdings
HankyuCorporation

Hankyu Realty

Hanshin Electric
Railway

Hankyu Realty<Second Phase>
Hankyu Hanshin Holdings

HankyuCorporation

Real
Estate※Hankyu Hanshin
RealtyHanshin Electric
Railway<First Phase>・Hankyu Corporation will transfer all sharesof its subsidiary Hankyu Realty to Hankyu
Hanshin Holdings.
⇒Hankyu Realty will become a subsidiaryof Hankyu Hanshin Holdings.

<Second Phase>・Hankyu Corporation and Hanshin Electric
Railway’s real estate businesses※1 will betransferred to Hankyu Realty by means ofan absorption-type company split. ※2
・Hankyu Realty will change its trading nameto Hankyu Hanshin Realty.
⇒Hankyu Hanshin Realty will become
the Group’s core real estate company.

RealEstate※※1 Including the shares of the companies’ subsidiaries and affiliates that engage in leasing, development, real estate sales, and funding※2 Hankyu Corporation and Hanshin Electric Railway will retain their leasing/development-use real estate in the Umeda and line-side
areas. Both companies will collaborate with Hankyu Hanshin Realty in an effort to build transport networks and develop communities
with local stakeholders
53

〔Others〕②Main Projects

54

[Urban Transportation] Main Projects
Kita-Osaka Kyuko Railway Line Extension Project【Development plan summary】

Shin-Mino- KayanoSanpeio Sta.
Bashi(provisional
name)・Extension distance:
2.5 km, from Senri-Chuo Sta. to Shin-Mino-o Sta. (provisional name)Approx.
1.1km

・New stations:
Act on Rail Tracks

National Route171

Shin-semba-kitabashi

・Estimated project cost: ¥65.0 billion
・Demand: 45,000 people per day【Business scheme】
・Developer:

Kita-Osaka Kyuko Railway Co., Ltd. and Minoh City (development of infrastructuralcomponents between Mino-o-Semba Sta. and Shin-Mino-o Sta.)・Operator: Kita-Osaka Kyuko Railway Co., Ltd.
・Funding programme: Social capital development grant・Portion to be borne by Kita-Osaka Kyuko Railway Co., Ltd:

Mino-oSemba Sta.
(provisionalname)¥11.0 billion; Amount commensurate with profits(including the increase in demand associated with related community development)

Shin-sembaminamibashi【Schedule】

December, 2015: We have obtained a license for railway business and acharter for railway track operations

December, 2016: Commencement of construction
FY2021: Intended start of service
SenriChuo
Sta.

Approx. 1.4km
Shin-semba minamibashi

Underground section

Mino-oShin-MinoApprox. 1.1km
Semba Sta.
o Sta.
(provisional(provisionalname Shin-semba-kitabashi name)

Kayano-sanpeibashi

Railway Business Act

National Route 423（Shin-midosuji）

Approx.
1.4km

SenriChuo
Sta.

Mino-o-Semba Sta. (provisional name), Shin-Mino-o Sta. (provisional name)National Route 423 Elevated section National
Route 171 55(Shin-midosuji）main line

[Real Estate] Main Projects [Umeda and line-side areas] ①
Umeda 1-1 Project (Dai Hanshin Building and Shin Hankyu Building Rebuilding Project)【Project summary】
Location
1-1 Umeda, Kita-ku, Osaka
Site area
Approx. 12,200 ㎡*
Total floor space Approx. 260,000 ㎡【Conceptual illustration of the building exterior】

Number of floors 38 floors above ground and 3 below groundPurpose

Department store, offices, halls, etc.

Planned total
investment¥89.7 billion

Construction
completion

Around spring 2022

* Including 750㎡ of road between Dai Hanshin Building and Shin Hankyu Building【Schedule】
July 2015
begin phase I construction
phase I construction (Shin Hankyu
Around spring Complete
Building and Dai Hanshin Building East Wing)
2018
and partially open new department store
Around spring phase Ⅱ (Begin Dai Hanshin
Building West Wing demolition)
2018
Around spring Phase Ⅱ (begin phase Ⅱ
construction)
2019
Complete phase II construction (newArounddepartment store part) and fully open newautumn 2021 department store
Around spring Complete all construction and2022
open offices【Phase I】【Phase Ⅱ】

4
2
1

3

5

①Dai Hanshin Building East Wing(under construction)②Shin Hankyu Building(under construction)③Dai Hanshin Building West Wing(businesses operating)④Dai Hanshin Building West Wing(under construction)⑤Phase I (businesses operating)56

[Real Estate] Main Projects [Umeda and line-side areas] ②
In order of
opening date

Chayamachi 17banchi project

Nishinomiya Kitaguchi Hankyu
Building (Provisional Name)
Construction Project

Extension of Ebista
Nishinomiya, acommercial facility
adjacent to Hanshin
Nishinomiya

Location

Chayamachi, Kita-ku,
Osaka

Takamatsucho, Nishinomiya,
Hyogo Pref

Tanakacho, Nishinomiya,
Hyogo Pref

Site area

Approx. 440㎡

Approx. 3,000 ㎡

Approx. 5,300㎡（Extended area）

Total floor
space

Approx. 2,800㎡

Approx. 11,600 ㎡

Approx. 10,000㎡（Extended area）

Number offloors

8 floors above groundand 1 below ground

10 floors above ground and 1 below
ground3 floors above groundPurposeCommercial facilities(global flagship store
Commercial and educational facilities Commercial facilities「MIZUNO OSAKA」)

Scheduled
opening

Around spring 2018

Around autumn 2018

Around autumn 201857

[Real Estate] Main Projects [Umeda and line-side areas] ③
In order of
opening date

Fukushima 5-Chomeand 7-Chome joint
development project

Ebie 1-Chome
Development Plan

Project to relocate
Takarazuka Hotel

Plan site

Location
Site area

Total floor
space
Number offloors

Fukushima, Fukushima-ku,
Osaka
Approx. 2,600㎡(The Company own 1,800㎡)

Ebie, Fukushima-ku, Osaka

Sakaemachi, Takarazuka,
Hyogo Pref

Approx. 27,900㎡

Approx. 12,300㎡

Approx. 11,000㎡－

12 floors above ground－Purposehotel, supermarket

condominium,
commercial facilities（landto let）

Scheduled
opening

Around spring 2019

Around autumn 2019
(Scheduled time of condominium completion)

Approx. 23,000㎡
5 floors above ground and 1
below groundrooms (Approx. 200rooms)
party hall (4 halls)
restaurant (4 facilities)
Around spring 202058

[Real Estate] Main Projects [Umeda and line-side areas] ④
In order of
opening date

Project for a logistics facilities in the
Sanroku Line area of the eastern section ofInternational Culture Park ‘Saito’

Project to rebuild Kobe
Hankyu Building’s east
wing and renew its
west wing

A zoneB zoneLocationIn the Sanroku Line area of the eastern section of
Ibaraki City’s International Culture Park ‘Saito’

Kanocho, Chuo-ku, Kobe

Site area

A zone：Approx. 51,000㎡ B zone：Approx. 16,000㎡

Approx. 7,100㎡

Total floor
space
Number offloorsPurposeScheduled
opening

A zone：Approx. 125,000㎡ B zone：Approx. 32,000㎡ Approx. 32,900㎡
A zone：6 floors above groundB zone：4 floors above groundlogistics facilities（A zone：multitenant logistics facility［High-tech facilities designed to be used by multiple tenants］、
B zone：BTS logistics facility［Facilities built to suit a particular tenant’s specifications］）

A zone：FY2022 B zone：FY2021

29 floors above ground and 3
below ground
Offices, hotelhotel(remm expected
to become tenant), commercial
facilities, railway station
Around spring 2021

59

[Real Estate] Main Projects [Tokyo metropolitan area]
Yotsuya Station
District Redevelopment
Project

2-6 Kyobashi
Redevelopment Plan

Ginza 3-chome Project

LocationYotsuya, Shinjuku-ku, Tokyo

Kyobashi, Chuo-ku, Tokyo

Ginza, Chuo-ku, Tokyo

Site area

Approx. 17,900㎡

Approx. 1,450㎡

Approx. 310㎡

Approx. 17,000㎡－

Total floor
Approx. 139,600㎡
space
Number of 31 floors above ground and 3
floorsbelow groundoffice, commercial facilities,
Purposeresidence, educational
services, public good, parking
Scheduled Around early 2020
(Scheduled time of construction completion)
opening

14 floors above ground and 1－
below groundhotel(remm expected to
become tenant), office,commercial facilities
commercial facilities
Around spring 2019－60

[Overseas] Main Projects①
Overseas logistics centre businesses· Explore business possibilities primarily in the countries that Hankyu Hanshin Express (HEX)
has targeted for expansion. To this end, hire survey firms to pinpoint the areas for expansion,consider the method for expansion, and gather customer information.
【 Initiatives in Singapore】【Initiatives in Indonesia】· HC and HER jointly established logistics centre· Logistics centre holder and operator, Hankyu
holder, Hankyu Hanshin Properties Singapore Pte.
Hanshin Logistics Indonesia, was established inLtd., in Singapore, which is one of the foremost hubs
August 2014 through a joint investment byin the international logistics network.
Hankyu Corporation (HC), Hanshin Electric
Railway (HER), and HEX.
· The logistics centre was completed and put into
service in May 2017. Hankyu Hanshin Express· Construction was completed in November 2015
Singapore Pte. Ltd. and other companies are using
and operations commenced in March 2016.
the centre to provide high value-added logistics
Hankyu Hanshin Logistics Indonesia is currently
operating together with an existing local forwarder services focusing on goods related to Singapore’s key
industries, including electrical components, medicalwith a view to further improving the logistics
equipment, and pharmaceutical products.
network and providing high-quality logistics
services.

【Logistics centre in Indonesia】【Logistics centre in Singapore】

61

[Overseas] Main Projects②
Real estate sales business in overseas markets· We completed and sold all units in FLORA -ANH DAO-, a Ho Chi Minh City-based business project inwhich we participated. FUJI RESIDENCE and FLORA -KIKYO- are performing well, and in MIZUKI PARK,
we have started developing a large residential plot, the total development area of which is 26ha.
· Regarding the Bumi Serpong Damai residential land lot project on the outskirts of Jakarta, Indonesia,
in which we are participating, construction work is now underway, and sales are expected tocommence before the end of fiscal 2018.
· We are making headway with a condominium sales project in Bangkok, Thailand. Also, we got the goahead to participate in a project in Dasmariñas※, Philippines.
※Situated around 30km south of Manilla’s centre, Dasmariñas serves as a bed town for people who work in the Metropolitan Manila Area or its industrial suburbs.

· In addition to the above initiatives, we are exploring the potential for expanding into a number ofcountries (such as Malaysia) over a number of years. While building our track record, we will continue
to gather information, ascertain local conditions, and accumulate business knowhow with respect toresidential developments in ASEAN countries.
[Vietnam][Thailand］
・Joint project by SENA Development
Public Co.
・Niche Mono Sukhumvit(condominium :Total 1,275 units)
・Niche Pride Taopoon Interchange(condominium :Total 777 units)[Indonesia］
・Joint project by Sinarmas Land Ltd.
and others
・Bumi Serpong Damai residential
land lot project(house): Total 900 units(business loft: Total 150 units)

・Joint project by NAM LONG INVESTMENT Co. andNishi-Nippon Railroad Co.
・FLORA -ANH DAO-(condominium): Total 500 units
・FUJI RESIDENCE (condominium): Total 789units(house): Total 84 units
・FLORA -KIKYO- (condominium): Total 234 units
・MIZUKI PARK (condominium): Total 4,670 units over(house): Total 100 units over(townhouse): Total 60 units over[Philippine]・Joint project by P.A. ALVAREZ PROPERTIES AND
DEVELOPMENT Co.
・Detached house business in Dasmariñas(house): Total 403 units(townhouse): Total 465 units

62