Aoyama Zaisan Networks Company Limited

A o y a m a
Z a i s a n
N e t w o r k s

First Half Business Summaryfor Fiscal Year 2023

( 3 3 rd period)
January 1 to June 30, 2023

Securities Code: 8929

To Our Shareholders
In the past three years, many companies
have been forced to curtail theirbusinesses due to the special factor ofCOVID-19 crisis. Furthermore, given theimpact of inflation caused by surging raw
materials prices and higher energy costs,
as well as volatility in the financial andcapital markets, we must continue tofollow trends in the environment
surrounding the individual asset owners
and corporate owners who serve as theGroup’s customers.
Under such circumstances, in the threeyears from 2022 to 2024 positioned as aperiod for expanded growth in our Third
Medium-Term Management Plan, we areworking to strengthen our business fromthe following standpoints.
The first aim is that of achieving higher
quality and quantitative expansion of ourcustomer services, based on the twin
cornerstones of eight strategic
individualized services andcomprehensive property consulting
services.
Some new customers feel that the barrier
to entry is too high to jump right into
comprehensive property consulting.
For this reason, we believe that by firstmaking contact with our customers
through strategic individualized services
that meet their needs, and then using thatas a starting point, we can smoothly
connect them to our comprehensive
property consulting services.
We look forward to increasing revenues
by meeting customer needs through thesynergistic effect of these services and bybuilding long-term relationships.
As of December 31, 2022, the ADVANTAGE
CLUB had 63 partnerships withcumulative amounts of more than ¥110.0
billion and No. 1 market share.*1 Our
target for 2023 is ¥32.5 billion of new2

Highlights of Consolidated
Business Results

Net sales were ¥14,039 million (¥20,232 million in the same period of the previous fiscal year) withinvestment.
In order to make our services available to
new customers, we have been working
with financial institutions since 2021, andhave formed partnerships with 42
institutions*2 to date.
The second aim is to standardize property
consulting services using DX. The core ofthis approach is the ART system, which
was developed and introduced by theGroup in February 2021.
By introducing the ART System, the insidesales team can handle the initial stage ofeach project using standardized
consulting. This allows our highly
specialized consultants to demonstrate
their expertise, to focus oncomprehensive property consulting work,and to provide more extensive care tocustomers than ever before.
The third aim is that of growing into a
consulting group with strong
interpersonal skills.
For our consultants, it is of paramountimportance to earn the trust of ourcustomers in order to successfully consult
with them about their valuable assets andbusinesses.
To achieve this, it is essential that wegrow into a consulting group thatpossesses strong interpersonal skills
combining integrity, kindness, andcompassion.
In order to build up such interpersonal
skills, in addition to ideals training
conducted in-house, we promote
initiatives such as supporting participationof Group employees in activities that
contribute to society outside the company
too.
The fourth aim is to proactive approach tosocial contribution activities.
The Group has been continuously making

Aoyama Zaisan Networks

development of ¥11.03 billion in the ADVANTAGE CLUB.
Operating income was ¥1,102 million (¥1,097 million in the same period of the previous fiscal year), as we
worked to reduce other selling, general and administrative expenses, despite an increase in personnel from
our aggressive hiring activities in the previous fiscal year.
President

Masazumi Hasumi

Net sales

14,039(Downdonations to the Tokyo Medical
Association and providing supplies to
medical institutions, using a portion of theprofits generated through its business.
Since last year, in addition to donating toorganizations tackling social issues suchas elimination of pet euthanasia andpromoting subsidized meals for children,
we have also promoted our employees’
own social contribution activities andhave established a new social
contribution plan as a shareholder
incentive, among other efforts.
We will continue to make company-wide
contributions through cross-functionalorganizations such as our Sustainability
Committee to help realize a society thatsustains many people in happiness.
While improving our ability to respond to
customers through the above initiativesto accelerate DX and improve ourinterpersonal skills, we are also focusedon recruiting and human resource
trainings to respond to the growing needfor consulting on property succession andmanagement.
We are undertaking diverse measures toreach our goals by fiscal year 2024, thefinal year of the Third Medium-Term
Management Plan.

*1 Share of cumulative amounts in voluntary partnerships formed based on the Act on Specified Joint Real Estate Ventures (as of December 31, 2021)*2 As of June 2023

30.6% year-on-year)

First half of fiscal year
End of fiscal year

0.5% year-on-year)

First half of fiscal year

(forecast)

20,232
9,463

11,919

61.22

1,303

14,039

33.01
1,190

730

1,097

15.0 yen(Full-year forecast: 41.0 yen)

Year-end

41.0(forecast)

44.37
29.46

1,102

(forecast)

69.82

1,856

19,118Dividends
per share

Interim

81.38

End of fiscal year

2,629
24,21334.26 yenFirst half of fiscal year

3,300

End of fiscal year

(forecast)Net
profit pershare

million yen(Up39,500

35,952

1,102

Operatingincomemillion yen

26.5
16.5

28.0
17.0

10.0

11.0

34.26

17.95

26.0

35.0
22.0

(forecast)

13.0

15.0

Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023
(30th period) (31st period) (32nd period) (33rd period)

Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023
(30th period) (31st period) (32nd period) (33rd period)

Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023
(30th period) (31st period) (32nd period) (33rd period)

Fiscal Year 2020 Fiscal Year 2021 Fiscal Year 2022 Fiscal Year 2023
(30th period) (31st period) (32nd period) (33rd period)(unit: million yen)(unit: million yen)(unit: yen)(unit: yen)

*The Company conducted a 2-for-1 stock split of common shares on September 1, 2021.
The bar chart above reflects the assumption that the stock-split was conducted at thebeginning of the fiscal year ended December 2020.

Consolidated
Balance Sheet(Summary)(unit: million yen)

Total assets 21,757

1 Total assets 24,982
2 Interest-bearing liabilities2,071

Interest-bearing liabilities2,152(Remaining loan period: 12 years)(Remaining loan period: 13 years)

Cash anddeposits
12,804

Interest-bearing liabilities
other than the above
5,981

Real estate for sale Other liabilities
5,303
1,751
Real estate for rent
2,271
Other assets
4,931

Net assets
8,320
Equity ratio
38.0%

End of fiscal year 2022

Cash and deposits

11,6512 Interest-bearing liabilities

other than the above

9,556

Real estate for sale

Other liabilities

4,686

6,237

Real estate for rent

2,221

Other assets

4,872

3

Net assets

8,667

Equity ratio
34.4%

End of June 2023

1 Total assets
Total assets amounted to ¥24,982 million,up ¥3,224 million from the end of theprevious period, mainly due to increases inreal estate for sale.

2 Interest-bearing liabilities
Interest-bearing liabilities amounted to¥11,627 million, up ¥3,493 million from theend of the previous period due to anincrease in short-term loans payable, etc.

3 Net assets
Net assets grew by ¥347 million from theend of the previous period to reach ¥8,667
million mainly due to an increase inretained earnings.

3Business Topics

Making the STO (Security Token Offering) business our second pillar after the ADVANTAGE CLUBTokai Tokyo Securities Co., Ltd. and the Company’scapital and business alliance partner group Hash DasH
Co., Ltd. offered subscriptions to the Company’s first
fund offering real estate backed by security tokens (ST),“Security Token Shibuya Jingumae Innovation Office,”
which sold out.
Given increasing real estate management needs, for
STOs as one of our strategic individualized services, weare further preparing to make management products
backed by real estate our next pillar after theADVANTAGE CLUB.

Explanation of the“future development of the STO business”

In June 2023, we participated in the IR Seminar for Individual Investors held by logmi Finance.
At the seminar, which was streamed as a Zoom webinar, we gave a speech in which weoutlined our company and discussed the outlook for the future.
We are also giving briefings on our business development to make the STO business using
blockchain the second pillar of our business.
We invite you to deepen your understanding of our business, which is welcoming a new
growth stage.

(voluntary partnership for monetary investment-type)

Security token (ST) represent the asset value that can be transferred using an electronic data processing system
for the rights represented in securities such as stocks and bonds. Issuing security tokens as a means offundraising is known as a Security Token Offering (STO).
The Company has focused on building this structure and has acquired and provided theShibuya Jingumae IO LLC

Master lessee/property manager

REALGATE INC.

Beneficiaryrights in realestate trust

Leasing contract and property
management contract

Mitsubishi UFJ Trust andBanking Corporation

Contract to amend
the real estate
management anddisposition trust

Aoyama Zaisan Networks
Company, Limited

4Beneficiaryrights transfer
contract

Initial costs

Hash DasH Holdings Co., Ltd.

Cumulative numberof partnerships

ASP service contract

Cumulativeamounts

ST platform provider

Sales company/administrative
agent/asset custody company

Hash DasH Co., Ltd.
Sales company*“the Folks BY
IOQ”Jingumae,
Shibuya-ku

Real estate management and disposition trust
Originator

Borrowings

ADVANTAGE CLUB® since 2002 (as of June 30, 2023)

Loancontract

Equityinterests inanonymous
association

Issuedas an ST
Anonymous
association
contract

Tokai Tokyo Securities Co., Ltd.

Financial institutions

Investors

Handling subscriptions(issuer = business operator)

Businessoutsourcing
contract

Discretionary
investment
contract

Application
handling contract

Tosei Asset Advisors, Inc.

Trustee

We provide the real estate small-lot product “ADVANTAGE CLUB” as our key consulting product.
We received numerous applications and formed the “Akasaka” voluntary partnership in March 2023 and the “Kyobashi Takaracho”
and “Kagurazaka #1 and #2” voluntary partnerships in June 2023.
All these properties feature attractive areas that have both office buildings and mansions while also having shopping and gourmet
restaurants that attract many visitors.
ADVANTAGE CLUB engages in regular product formation to meet the diverse needs of our customers.

real estate that backs the security token (ST) as an originator.

Asset management company

the IR Seminarfor IndividualInvestors

Formed partnerships for three
new properties in Tokyo

Real Estate Specified Joint Enterprise

Real estate STOs (security token offerings) following our ADVANTAGE CLUBStructure

Holding briefings for individual investors

67¥127.8 billion

Total partnership
members
Akasaka: Hulic Akasaka
Hitotsugi-dori Building

Results andpoints ofADVANTAGE
CLUBKyobashi Takaracho:
JP-BASE KYOBASHI

4,954Kagurazaka #1 and #2:
Nikko Kagurazaka Building

Fiscal year 2023 goal of ¥32.5 billion in new partnerships.
(totaling four times our net asset totals
at the end of the previous fiscal year)
Expand our partnerships to 42 financial institutions
including banks and securities companies.
Lead customers to comprehensive consultingwith ADVANTAGE CLUB as the starting point.

Trends of cumulative amounts (unit: billions of yen)Amount of newly developed partnerships

Existing

50.93
4.25

57.45
6.52

62.75
5.30

72.03
9.28

116.77

88.28
16.25

28.49

32.5

End of 2017 End of 2018 End of 2019 End of 2020 End of 2021 End of 2022 End of 2023
(forecast)5Aoyama Zaisan Networks

Report on
donations throughthe shareholder
incentive system

We would like to express our sincere thanks to our shareholders who chose the donation
option in our shareholder incentives covering current shareholders as of June 30, 2022.
We would like to report that we made the following donations.
Number ofpeople
Shareholders choosing“donations to initiatives
for completely eliminating pet euthanasia”

28

Shareholders choosing“donations to‘kodomo
shokudo’cafeterias for children”

Shareholder i nce n t i ve s21

Donation recipient
Humanin Foundation

Amount of Date of donation
donation

84,000 yen November 30, 2022

Certified nonprofit organization National
31,500 yen November 30, 2022
Children’s Cafeteria Support Center Musubie
One-million People Classic Live Foundation 31,500 yen November 30, 2022

The Company provides shareholder incentives under the following conditions to shareholders
recorded in the shareholder register as of June 30 (as of June 30, 2023).

Donations to initiative for completely
eliminating pet euthanasia

Donations to“kodomo shokudo”
cafeterias for children

In lieu of receiving a gift item,
shareholders may opt to have3,000 yen contributed to theHumanin Foundation, whichseeks to eliminate
pet euthanasia while giving rise
to a harmonious society wherepeople and pets are able to live
happily together.

In lieu of receiving a gift item, shareholders may
opt to have a 3,000 yen contribution in partmade to certified nonprofit organization National
Children’s Cafeteria Support Center Musubie,
which provides support for children’s cafeterias
nationwide, and also in part made to One-million
People Classic Live Foundation, which supports
mental health by having live music played in“kodomo shokudo”cafeterias for children.

Shareholders who hold 2,000 shares or more

Shareholders who hold 10,000 shares or more continuously for over 2 years

Select one of 10 products worth 3,000 yen, or select one of the two donation options above

The UKAI Group common meal certificate (20,000 yen)or Ukai special select beef (worth 20,000 yen)

AZN network

Aoyama Zaisan Networks

Providing premium-quality
services from domestic andoverseas networks● Number of bases of AZN nationwide network memberJapan96 bases(as of July 1, 2023)

The“AZN nationwide network”refers to astructure that connects accounting offices andtax accounting firms throughout Japan, andprovides the Group’s comprehensive
property consulting services and the eightstrategic individual services throughout Japan.

Hokkaido/Tohoku

10 basesChubu

18 bases
Chugoku/Shikoku

15 basesKanto

33bases
Image

Image

Kinki

9 basesRelease of Integrated Report 2023

6Please see the Company’s website for our“Integrated Report 2023,”our third annual report.
The report features our value creation story, our long-term vision, an introduction of ourconsultants, and message on important points in our growth from Outside Directors.
Furthermore, starting in last year’s edition, we expanded and improved contents by adding
sections on human capital and TCFD, the ratio of male employees taking childcare leave, andaverage salary (overall, male/female/wage ratio).
We seek to further increase corporate value by enabling our stakeholders to gain a greater
understanding of the Company through disclosure of such information going forward.

Kyushu/Okinawa

11 bases7C o r p o r a t e D a t a (as of June 30, 2023)

E x e c u t i v e s (as of June 30, 2023)

Name of Company

Aoyama Zaisan Networks Company, Limited

P r e s i d e n t

Masazumi Hasumi

H e a dO f f i c e

3F Aoyama Tower Place, 8-4-14
Akasaka, Minato-ku, Tokyo
107-0052
Tel. +81-3-6439-5800

Director, Managing Executive Officer

Masayuki Yagi

Director, Managing Executive Officer

Takeshi Matsuura

Incorporated

September 17, 1991

Director, Managing Executive Officer

Takaomi Ogawa

Capital stock

1,210.99 million yen

Director, Managing Executive Officer

Shintaro Hashiba

Individual property consulting
Business succession consulting
Real estate solutions consulting

Director, Executive Officer

Shinji Shimane

Lines ofbusinessD

Outside Director

Haruo Shimada

Number of employees

297(group consolidated)

Outside Director

Keiji Watanabe

Consolidated
subsidiaries

Aoyama Estate Co., Ltd., Nihon Shisan Soken Co.,
Ltd., Aoyama Zaisan Investments Co., Ltd.,
Aoyama Zaisan Networks Kyushu Co., Ltd.,
Aoyama Financial Service Co., Ltd., Aoyama Family
Office Service Co., Ltd. and 4 other companies

Outside Auditor (standing)

Hiroyuki Fujita

Ar

Hisao Nakatsuka

Outside AuditorHiroaki Rokugawaiuredcittoor

Michihiro Nagasaka

S t o c k O v e r v i e w (as of June 30, 2023)

Notes for Shareholder

Number of shares in issue … ……………… 24,520,859
Number of shareholders …………………… 8,238
Major Shareholders (Top 10)

Fiscal year
Base date for the determination ofshareholders with year-end dividend
entitlements

Name
Masazumi Hasumi

Shares held Shareholding ratio
2,508,976

10.31

Custody Bank of Japan, Ltd. (trust account) 1,263,200

5.19

Nihon M&A Center Inc.

1,000,000

4.11GOLDMAN SACHS INTERNATIONAL

537,693

2.21

Custody Bank of Japan, Ltd. (pension trust account)

537,400

2.20

Capital Asset Planning, Inc.

400,000

1.64

The Master Trust Bank of Japan, Ltd. (trust account)

346,600

1.42

NORTHERN TRUST CO. (AVFC) RE UKAI AIF
CLIENTS NON LENDING 10PCT TREATY ACCOUNT

340,000

1.39

Mutsumi Shimada

337,000

1.38

Aoyama Zaisan Networks Employees’Shareholding Association

331,300

1.36

January 1 to December 31
December 31

Base date for the determination ofshareholders with interim dividend

June 30

entitlements

General meeting of shareholdersAdministrator of the shareholder
registry/Account management
institution for special accountContact

Stock exchange listings
Public announcements

in MarchMitsubishi UFJ Trust and BankingCorporation
Mitsubishi UFJ Trust and Banking Corporation, Stock Transfer
Agency Department 1-1, Nikko-cho, Fuchu-shi, Tokyo
Tel. 0120-232-711 (toll-free, Japan only)
Mailing address: P.O. Box 29, Shin-Tokyo Post Office137-8081 Mitsubishi UFJ Trust and Banking Corporation,
Stock Transfer Agency Department
TSE Standard Market
To be announced on the Company’s website(For reference)
1. S hareholders’address changes, repurchase requests, and such other procedures, asa rule, are filled with the account-administrating institutions where shareholders
have their accounts (securities companies, etc.). Shareholders are requested tocontact their account holding securities companies, etc., for information.
Shareholders are reminded that application filings cannot be made with theadministrator of shareholder registry (Mitsubishi UFJ Trust and Banking Corporation).
2. Dividends hitherto uncollected by shareholders are paid by Mitsubishi UFJ Trustand Banking Corporation, Head Office Branch.