COMPANY RESEARCH AND ANALYSIS REPORT

Arealink Co., Ltd.
8914
Tokyo Stock Exchange Standard Market

17-May-2022
FISCO Ltd. Analyst

Nozomu Kunishige

FISCO Ltd.
https://www.fisco.co.jp

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/■ Index■Summary---------------------------------------------------------------------------------------------------------------------------------------------------------------------------- 01
1. Summary of FY12/21 results. . ......................................................................................................................

01

2. FY12/22 results outlook...............................................................................................................................

01

3. New medium-term management plan..........................................................................................................

02■Company overview--------------------------------------------------------------------------------------------------------------------------------------------------- 03
1. Company overview......................................................................................................................................

03

2. History................................................... ......................................................................................................

04■Business description---------------------------------------------------------------------------------------------------------------------------------------------- 05
1. Business segments................................ ......................................................................................................

05

2. Self-storage business............................ ......................................................................................................

06

3. Land rights consolidation business..............................................................................................................

08

4. Other operational services business............................................................................................................

09■Results trends--------------------------------------------------------------------------------------------------------------------------------------------------------------- 09
1. FY12/21 results............................................................................................................................................

09

2. Financial condition and management indicators. .........................................................................................

11■Future outlook--------------------------------------------------------------------------------------------------------------------------------------------------------------- 13• Outlook for FY12/22. . ............................. ......................................................................................................

13■Growth strategy----------------------------------------------------------------------------------------------------------------------------------------------------------- 15
1. Summary of targets in the new medium-term management plan. ................................................................

15

2. Priority measures.........................................................................................................................................

16■Shareholder return policy---------------------------------------------------------------------------------------------------------------------------------- 19

We encourage readers to review our complete legal statement on “Disclaimer” page.

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/█ SummaryMain business is self-storage management and is aiming steady
growth by stock business
Arealink Co., Ltd. <8914> (hereafter, also “the Company”) is the leading company in the self-storage industry known
for its Hello Storage brand. Through self-storage, the Company is aiming to contribute to better lifestyles for people,
and achieve stable growth over the medium- to long-term with cumulative-type businesses. While maintaining amanagement structure with a small number of highly skilled employees, its main business is self-storage management, which generates stable earnings, and it intends to lead further advancement of the industry by continuing togrow steadily in the long term regardless of economic fluctuations. In addition to its mainstay self-storage business,
it conducts the land rights consolidation business and other operational services business. Moreover, it is focusingon pursuing ESG management to solve social issues. The Company was listed on the Second Section of the Tokyo
Stock Exchange (hereafter, “TSE”) in May 2020, and moved to the Standard Market in line with the TSE’s transition
to new market segments in April 2022.
1. Summary of FY12/21 results
In the FY12/21 results, net sales were ¥20,572mn (down 8.5% year on year (YoY)), operating income was ¥3,044mn(up 33.8%), ordinary income was ¥3,009mn (up 39.2%), and net income was ¥3,171mn (up 42.5%). In addition,
net sales and profits came in above the Company’s initial forecasts across the board. Although sales declined in
the land rights consolidation business as momentum was weak, sales continued to rise in mainstay self-storage
management. On the profit front, strong performance of self-storage management, drove double-digit profit growth,with the occupancy rate reaching a record-high since the Company’s listing. Furthermore, net income increased
sharply due to the recording of a gain on reversal of provision for loss on repurchases of ¥1,610mn as extraordinary
income. As a result, the equity ratio rose to 49.7% (from 44.6% in the previous fiscal year), approaching theCompany’s target of 50% and indicating a high degree of financial soundness. Regarding indicators of profitability,
Return on Assets (ROA) was 7.3% and Return on Equity (ROE) was 16.2%, exceeding the FY3/21 averages for thereal estate industry on the TSE First Section of 3.1% and 6.6%, respectively. The Company increased its annual
dividend per share by ¥16.0 YoY to ¥47.0.
2. FY12/22 results outlook
For the FY12/22 results, the Company forecasts net sales of ¥20,600mn (up 0.1% YoY), operating income of¥3,300mn (up 8.4%), ordinary income of ¥3,200mn (up 6.3%), and net income of ¥2,100mn (down 33.8%), as it
continues to promote a shift to cumulative-type business that can generate steady income. The Company plans
to increase sales and profits in the mainstay self-storage business by continuing to strive to expand and growcumulative-type business, mainly self-storage management. Conversely, it expects sales to decline but profits torise in the land rights consolidation business because it looks to improve the segment’s profit margins. It plans toincrease its annual dividend per share by ¥3.0 YoY to ¥50.0, for a dividend payout ratio of 30.1%.

We encourage readers to review our complete legal statement on “Disclaimer” page.

01 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Summary

3. New medium-term management plan
In February 2022, the Company announced Medium-Term Management Plan 22-24 (hereafter, “the new medium-term management plan”), moving up its profit targets for FY12/23 because profit margins improved significantly
and results were above the targets in Medium-Term Management Plan 21-23 announced in February 2021 during
its first fiscal year, FY12/21. The management targets in the new medium-term management plan are for net salesof ¥24,000mn (up 16.7% compared to FY12/21), operating income of ¥3,800mn (up 24.8%), and ordinary incomeof ¥3,700mn (up 22.9%) in FY12/24, the plan’s final year. In advancing the management plan, the Company plans
to focus on profit growth underpinned by self-storage management. While the new medium-term management
plan’s management targets are ambitious, we at FISCO think the numbers are realistic since the self-storage market
in Japan is expected to have substantial growth potential. It should also be noted that the Company is proactively
promoting ESG management while pursuing profits as the industry leader. Future ESG initiatives are also key in thatthe tendency for investors, mainly institutional investors, to invest in companies that take ESG into consideration
has been strengthening in recent years.
Key Points
The leading company in the self-storage industry. Has a management structure with a small number of highly
skilled employees, and is aiming for steady profit growth in the long term centered on the self-storage business• In the FY12/21 results, sales and profits both came in above initial forecasts, and self-storage management did
well• The new medium-term management plan targets steady sales and profit growth in its first year, FY12/22• Announced the new medium-term plan moving up initial profit targets by one year, advancing the management
plan focused on profit growth underpinned by self-storage management•㻾㼑㼟㼡㼘㼠㼟㻌㼠㼞㼑㼚㼐㼟㻺㼑㼠㻌㼟㼍㼘㼑㼟㻌㻔㼘㼑㼒㼠㻕㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㻔㼞㼕㼓㼔㼠㻕

(¥mn)

(¥mn)
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Source: Prepared by FISCO from the Company’s financial
 results

We encourage readers to review our complete legal statement on “Disclaimer” page.

02 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/█ Company overview
Growth from the Hello Storage series of container storage and trunkrooms
1. Company overview
The Company was founded by President & CEO Naomichi Hayashi, is the leading company in the self-storage
industry, is listed on the TSE Second Section, and has the corporate philosophy of “Provide convenience, enjoyment,
and excitement to the world.” In addition to its core business offering rental storage space (trunk rooms) under the
Hello Storage brand throughout Japan, the Company is also engaged in land rights consolidation business, officebusiness, and asset management business, among others.
Under the leadership of President Hayashi, the Company is continuing to achieve steady growth not affected byeconomic conditions by leveraging the three strengths described below through a flexible management strategy
that responds to environmental changes.
The first strength is that the Company’s self-storage business has the leading share in the industry for the number ofunits, approximately 17% to 18%. In the self-storage industry, there is an overwhelmingly large number of small-scalecompanies with market shares of less than 1%. Also, in the US, where this industry developed ahead of Japan, about
13.5mn or 10.6% of total households use self-storage, but in Japan, this number is about 600,000, which equates
to only about 1.1% of the number of total households. In recent years, needs for storage have risen centered on
metropolitan areas, and it can be said that the self-storage market is expected to grow greatly in the future. The
Company’s business is centered on self-storage management that generates stable earnings, and it is targeting amarket share of 50% in the medium term.
The second strength is that the Company’s financial structure is highly sound. In FY12/21, its equity ratio was 49.7%,
greatly exceeding the 32.3% average for the real estate industry on the TSE First Section in FY3/21, while it seems
that it is aiming to raise it to the 50% range in the medium term. It can be said that another of its strengths is that
it is the only listed company that conducts a self-storage business for individuals. The Company uses its excellent
financial structure as a weapon to develop its business under favorable conditions.
The third strength is that the Company is highly profitable. Specifically, at the end of December 2021, it had 73
employees (excluding directors, temporary employees, and dispatched employees), so its head office costs are
small under a management structure with a small number of highly skilled employees. Also, in FY12/21, ROA was
7.3% and ROE was 16.2%, which are higher than the averages of the real estate industry on the TSE First Section
in FY3/21 of 3.1% and 6.6% respectively. The Company is aiming to further grow earnings and improve profitability
by progressing the new medium-term management plan.

We encourage readers to review our complete legal statement on “Disclaimer” page.

03 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Company overview

2. History
The Company was established in Funabashi City, Chiba Prefecture, in 1995 as WELL’s Giken K.K. by Hayashi, thePresident and CEO, in order to launch a contracting business for the WELL’s 21 cross-industrial exchange stations.
In the year after its establishment (1996), it launched a property leasing business and Hello Parking, a coin-operated
parking lot business, and entered the real estate business. Subsequently, continuing on from Hello Parking, it
expanded its business area by launching a series of Hello Storage businesses, including the storage space businesses of Hello Container and Hello Trunk; Hello Monthly, a monthly apartment rental business; and Hello Office,an office rental business.
The Company, which develops the Hello Storage brand nationwide, concluded a licensing agreement in 2016 todevelopment properties in collaboration with the popular character Hello Kitty.
The Company, which had been developing the wide-ranging Hello Series, set the self-storage business (container
storage and trunk rooms), which has the advantages of little competition as a niche market and low running costs
as a non-residential type of real estate, as its core business, and it has aimed to expand and strengthen its businessunder the slogan of being “overwhelmingly No. 1 for share and quality.” On the other hand, alongside changes
in the market environment, it has reviewed its growth strategy, which has been dependent on buying and selling(brokerage), and is switching to a policy of aiming for stable growth centered on self-storage management. Also,
it announced Medium-Term Management Plan 21-23 in February 2021, but established the new medium-term
management plan in February 2022 because results sharply topped targets in the first fiscal year under the previousplan, and is aiming for steady growth based on a new business strategy.
The Company was listed on the TSE Mothers market in August 2003, and its listing was upgraded to the TSE
Second Section in May 2020. Also, it moved to the Standard Market in line with the TSE’s transition to new market
segments in April 2022.

We encourage readers to review our complete legal statement on “Disclaimer” page.

04 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Company overview

History
Date

History.

April 1995

Established WELL’s Giken K.K. for contracts for the WELL’s 21 warehousing office. Launched a contracting business for WELL’s
21 cross-industrial exchange stations.

April 1996

Launched a property leasing business (currently Mister Kashichi)

June 1996

Launched Hello Parking, a coin-operated parking lot business

March 1999

Launched Hello Container, a business for installing and leasing storage containers on vacant land

October 1999

Changed company name to Mister Kashichi Co., Ltd.

August 2000

Launched a coin-operated laundry business

September 2000

Conducted an absorption merger with Sysnet K.K. (property leasing business was transferred from Sysnet). Changed company
name to Arealink Co., Ltd.

December 2000

Acquired all the shares of Hayashi Soken Inc., and made it a wholly owned subsidiary (absorption merger in April 2002). Launched
Hello Monthly, a weekly/monthly apartment rental business.

February 2001

Launched the Hello Trunk business using vacant buildings for storage rental space

September 2002

Launched a stock management business to provide management services for the land and properties owned by the Company(currently, the Property Management Service business)

January 2003

Launched the Hello Renewal business to renovate old buildings to add value and improve management efficiency (currently, theProperty Revitalization & Liquidation Service business)

June 2003

Opened Hello Bike BOX, indoor parking for motorcycles

August 2003

Listed on TSE Mothers

January 2004

Launched the Hello Office business to lease SOHO utilizing vacant buildings

February 2005

Acquired Space Products K.K., in the same industry that manages Rakuchin BOX

November 2005

Exceeded 10,000 units in the Hello Storage business

January 2008

Exceeded 30,000 units in the Hello Storage business

June 2014

Exceeded 50,000 units in the Hello Storage business

July 2015

Exceeded 60,000 units in the Hello Storage businessAugust 2015
June 2016

Launched 2×4 (Two by Four) Trunks, suburban indoor-type rental spaces
Concluded a licensing agreement to develop properties in collaboration with Hello Kitty

December 2016

Relocated the Head Office to Sotokanda, Chiyoda-ku, Tokyo, its current location

November 2017

Exceeded 80,000 units in the Hello Storage business

November 2018

Exceeded 90,000 units in the Hello Storage business

May 2020

Listing was upgraded to the TSE Second Section

February 2021

Announced Medium-Term Management Plan 21–23

February 2022

Announced Medium-Term Management Plan 22–24

Source: Prepared by FISCO from the Company’s website and securities report█ Business description
Self-storage management is the core business
1. Business segments
The Company’s business is comprised of three business segments: 1) self-storage business, which is comprisedof two sub-segments, self-storage management and self-storage brokerage; 2) land rights consolidation business,
which includes buying and selling of land with limited proprietary rights and properties and obtaining land withlimited proprietary rights lease income, and 3) other operational services business, such as rental offices and asset
management. In order to further advance to the forefront of the self-storage business, which is the core business,
it changed the reporting segments from FY12/20.

We encourage readers to review our complete legal statement on “Disclaimer” page.

05 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Business description

Looking at the breakdown of net sales by segment in FY12/21, the self-storage business provided 75.2% (self-storage management 72.6% and self-storage brokerage 2.6%), land rights consolidation business 18.1%, and otheroperational services business 6.7%. Turning to the breakdown of operating income (before deducting administrative
expenses), the self-storage business provided 80.6% (self-storage management 84.1% and recording of an operating loss for self-storage brokerage), the land rights consolidation business 10.4%, and other operational services
business 9.0%. This demonstrates that the self-storage business, and within its self-storage management, is theCompany’s core business for both sales and profits.

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Note: Breakdown of operating income is previous to deducting administrative expenses
Source: Prepared by FISCO from the Company’s financial results

2. Self-storage business
The Company is achieving growth with the self-storage business at its core, and this business also provides anoverwhelming share of earnings. This business develops the Hello Brand in various service formats, including
for self-storage, parking lots, and rental offices. In the self-storage business, it discloses information for two
sub-segments, self-storage management and self-storage brokerage. Self-storage management is a businessfor the management, tenant recruitment, and administration of rental storage spaces, and it generates stable
cumulative-type income. Conversely, self-storage brokerage is a business for the ordering and sales of storage as
an investment product, and it can be said to generate temporary, flow-type income.
Hello Storage, which is the main brand in the self-storage business, was created to provide trunk rooms for homeand company usage. Large and small indoor spaces are partitioned, and various sizes and product types areprepared and offered at reasonable prices that enable the provision of services that meet the diverse needs ofcustomers. They can also be used safely 24 hours a day. As previously stated, the Company has the No. 1 share in
the industry for the number of properties. Specifically, its product types include outdoor-type trunk rooms (containertype), indoor-type trunk rooms (inside a building or entire building type), Bike Box individual motorbike storage, andbusiness storage two-story maisonette type.

We encourage readers to review our complete legal statement on “Disclaimer” page.

06 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Business description

Outdoor-type trunk rooms are the Company’s main product, and it manages a network of storage units nationwide,from Hokkaido in the north to Kyushu in the south, offering storage spaces that utilize durable containers used formaritime transportation. Features include the ability to park cars directly in front of containers, 24-hour access, andan abundance of substantial spaces ranging in size from small to large.
The indoor-type trunk rooms are mainly located in the central Tokyo area and have features including safe and secure24-hour access thanks to robust security provided by a major security company, and an abundance of popular
medium sizes. With some exceptions, they are also equipped with air conditioning systems. In cases where theCompany renovates various spaces, such as existing buildings (all or part of a floor) and warehouses, into trunk
rooms for self-storage operations, the basic mechanism is the same as that for the outdoor-type containers. As forindoor-type trunk rooms utilizing an entire building, the Company offers indoor storage spaces in buildings specificallydesigned for trunk rooms under the Trunk House 24 brand. These trunk rooms are compact with a smart designthat eliminates waste, and have exteriors that are adapted to their surrounding environments. In addition to featuring
construction designed specifically for trunk rooms, 24-hour access, clean exteriors and interiors, robust security via
a major security company, and a large number of units in a variety of sizes, these next-generation trunk rooms areequipped with air conditioning and elevators and offer free parking.
Bike Box individual motorbike storage products are independent box-type parking spaces exclusively for users with
contracts. They allow for the installation of several locks to enhance security. They are also equipped with storage
shelves and wide ladder rails to facilitate smooth storage, combining safety, functionality, and convenience.
The Company has offered business storage two-story maisonettes combining warehouse, office, residential, andparking space functions since 2020.
Hello Storage product lineup
Outdoor-type trunk
rooms container type

Indoor-type trunk rooms(inside a building)

Bike Box individual
motorbike storage

Indoor-type trunk rooms(entire building)Business storage
two-story maisonette

Source: Reprinted from the Company’s website

We encourage readers to review our complete legal statement on “Disclaimer” page.

07 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.

17-May-2022

8914 Tokyo Stock Exchange Standard Market

https://www.arealink.co.jp/en/ir/

Business description

The number of Hello Storage units had been steadily increasing each year, but the number of newly opened units in
2021 declined due to impact from the Company temporarily suspending property openings in 2020. As a result, thetotal number of Hello Storage units were down 101 units compared to the end of the previous fiscal year to 97,784
units in FY12/21 (details described later). Conversely, the occupancy rate rose 5.2 percentage points to 85.9%,
reaching a record high since the Company’s listing, partly because the occupancy rate for new properties rose due
to enhanced accuracy with regard to openings from 2019. Also, it seems storage needs are growing as remote
work has increased alongside the coronavirus and there is an increased need for securing storage spaces at home.

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㻲㼅㻝㻞㻛㻝㻣

㻲㼅㻝㻞㻛㻝㻤

㻲㼅㻝㻞㻛㻝㻥

㻲㼅㻝㻞㻛㻞㻜

㻲㼅㻝㻞㻛㻞㻝

Source: Prepared by FISCO from the Company’s financial results and website

3. Land rights consolidation business
The land rights consolidation business is a business that resolves the issues of landowners and leasehold rights
holders through the trading of complex land with limited proprietary rights. Income is generated mainly from thetrading of land with limited proprietary rights and real estate and lease income from land with limited proprietary
rights, so it generates mainly flow-type income.
The business model for the land rights consolidation business is as follows. As a general practice, a party constructs
a building on land that is rented. In this case, the owner of the building has the right to use the land (leasehold rights),
and is obligated to pay rental fees as compensation for using the land. On the other hand, the landowner that owns
the land cannot freely use the land as their leasehold rights are restricted. Land with attached leasehold rights inthis way is called land with limited proprietary rights. Although the landowner’s use of the land is restricted, they
have the right to receive rental income, and this right to rent the land is called “land with limited proprietary rights.”
Situations where the owners of the land and building differ create twisted and complex rights relationships, and thisalso affects the price of the land, so typically the leasehold rights portion is deducted. In this business, the Company
acquires land with limited proprietary rights from landowners and generates income by selling those rights to building
owners, while also arranging the rights relationships.

We encourage readers to review our complete legal statement on “Disclaimer” page.

08 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Business description

Overview of the land rights consolidation business<Leasehold
Rights>Building on landwith limited
property rights(land owned byothers)<Land with Limited
Property Rights>
Land with leasehold rights(building owned by others)
Source: Reprinted from the Company’s website

4. Other operational services business
The other operational services business is a business based on rental income, such as from offices and asset
management, and it generates cumulative-type income. Rental offices are rented in Tokyo’s 23 wards as offices
for use by a small number of people under the Hello Office brand, and demand for them is growing alongside theincrease in remote working due to the coronavirus. Asset management is a business for managing rentals of thereal estate the Company owns, but its policy is to maintain the current situation in consideration of unstable market
conditions and factors such as the risk that land prices will fall. Furthermore, rental meeting rooms were rented by
the hour in major metropolitan areas under the Hello Rental Meeting Room brand, but from the viewpoint of businessconcentration, the Company withdrew from this business in December 2020.

█ Results trends
In FY12/21 results, sales and profits were both above initial
forecasts, and mainstay self-storage management did well
1. FY12/21 results
In the FY12/21 results, net sales were ¥20,572mn (down 8.5% YoY), operating income was ¥3,044mn (up 33.8%),
ordinary income was ¥3,009mn (up 39.2%), and net income was ¥3,171mn (up 42.5%). Also, net sales and profits
topped the Company’s initial forecasts across the board. Sales declined in the land rights consolidation businessdue to impact from lackluster momentum, but sales continued to grow in mainstay self-storage management.
On the profit front, self-storage management did well, with the occupancy rate reaching a record-high since theCompany’s listing, and resulted in double-digit profit growth. Net income increased significantly more than operating
income and ordinary income due to the recording of ¥1,610mn gain on reversal of provision for loss on repurchases
as extraordinary income because within the provision for loss on repurchases that was recorded in FY12/19, theprovision for containers that were not actually repurchased was written off.
We encourage readers to review our complete legal statement on “Disclaimer” page.

09 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Results trends

Regarding impact from the coronavirus, worsening economic conditions brought about trunk room cancellations, butthere were also apparently positive effects on the self-storage business, including the movement toward arranging
homes alongside the increase in remote working.
Summary of FY12/21 results(¥mn)
FY12/20

FY12/21

YoY

vs. forecast

Results

vs. sales

Initialforecasts

Results

vs. sales

ChangeRate ofchangeDifference

Achievement
rate

Net sales

22,477100.0%

19,70020,572100.0%-1,905

-8.5%

872

4.4%

Gross profit

5,499

24.5%

-

6,035

29.3%

535

9.7%

-

-

SG&A expenses

3,223

14.3%

-

2,990

14.5%

-233

-7.2%

-

-

Operating income

2,275

10.1%

2,500

3,044

14.8%

768

33.8%

544

21.8%

Ordinary income

2,161

9.6%

2,400

3,009

14.6%

847

39.2%

609

25.4%

Net income

2,225

9.9%

1,400

3,171

15.4%

946

42.5%

1,771

126.5%

Source: Prepared by FISCO from the Company’s financial results

The results by segment are as follows.
(1) Self-storage businessIn the self-storage business, net sales were ¥15,469mn (up 4.7% YoY) and operating income was ¥3,415mn(up 56.3%), a strong performance. Also, this business’s share of total results were 75.2% of net sales (65.7% in
the previous fiscal year) and 80.6% of operating income (63.3%), and its operating income margin was 22.1%(14.8%), so it grew significantly as the core business. In the self-storage business, the Company’s policy since
FY12/19 has been for the earnings foundation to be self-storage management, a cumulative-type business thatstably accumulates monthly income, and it can be said that the results of this policy have materialized.
Within the segment, self-storage management, which is the core business, posted net sales of ¥14,941mn (up6.5% YoY) and operating income of ¥3,568mn (up 52.9%). Net sales rose for the 18th consecutive fiscal year since
the Company’s listing, and profit grew sharply because the operating income margin improved 7.3 percentage
points YoY. In addition to a decline in the number of newly opened units in 2021 due to impact from the Company
temporarily suspending opening activities in 2020, there were the periodic closures that occur each year. As aresult, the total number of Hello Storage units was down 101 units compared to the end of the previous fiscal
year to 97,784 units. Conversely, the occupancy rate at large-scale properties that were opened from 2016 to2018 rose over time, and the occupancy rate at new properties rose due to enhanced accuracy with regard to
openings from 2019 to contribute significantly to growth in the overall occupancy rate. As a result, the occupancy
rate increased 5.20 percentage points compared to the end of the previous fiscal year to 85.86%, an all-time highsince the Company’s listing in 2003. Moreover, the repurchases of containers that were advanced over the roughly
two years from 2020 had a beneficial effect on profit margins, and a reversal of provision for loss on subleases
that was recorded in FY12/18 arose in connection with the rise in the occupancy rate and the Company’s policy
shift towards opening properties that it owns.
Conversely, the “temporary” revenue rate declined due to sales to investors, and therefore in self-storage brokerage, net sales were ¥528mn (down 29.2%) and operating loss was ¥152mn (compared to a loss of ¥148mn
in the previous fiscal year).

We encourage readers to review our complete legal statement on “Disclaimer” page.

10 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Results trends(2) Land rights consolidation businessIn the land rights consolidation business, net sales were ¥3,716mn (down 38.7% YoY) and operating income
was ¥442mn (down 49.3%). This business’s share of total results were 18.1% of net sales (27.0% in the previous
fiscal year) and 10.4% of operating income (25.3%), while its operating income margin was 11.9% (14.4%). The
Company switched its policy from a focus on quantity to quality, and took steps to optimize the scale of thebusiness.
(3) Other operational services businessIn other operational services business, net sales were ¥1,385mn (down 15.5% YoY) and operating income was¥382mn (down 3.5%). This business’s share of total results were 6.7% of net sales (7.3% in the previous fiscal
year) and 9.0% of operating income (11.5%), while its operating income margin was 27.6% (24.2%). In the asset
management business, sales and profits declined due to impact from ongoing rent reductions for some tenants
affected by the coronavirus, but occupancy remained high. In the office business, sales increased as occupancy
conditions were solid, but profits decreased due to impact from costs for opening new properties in April 2021.
The Company withdrew from the rental meeting rooms business in December 2020, with a view to concentrating
management resources in core business.

㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼚㼑㼠㻌㼟㼍㼘㼑㼟㻌㼎㼥㻌㼟㼑㼓㼙㼑㼚㼠㻿㼑㼘㼒㻙㼟㼠㼛㼞㼍㼓㼑㻌㼎㼡㼟㼕㼚㼑㼟㼟㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼛㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㼎㼥㻌㼟㼑㼓㼙㼑㼚㼠㻸㼍㼚㼐㻌㼞㼕㼓㼔㼠㼟㻌㼏㼛㼚㼟㼛㼘㼕㼐㼍㼠㼕㼛㼚㻌㼎㼡㼟㼕㼚㼑㼟㼟

(¥mn)

(¥mn)

㻞㻡㻘㻜㻜㻜

㻠㻘㻡㻜㻜㻻㼠㼔㼑㼞㻌㼛㼜㼑㼞㼍㼠㼕㼛㼚㼍㼘㻌㼟㼑㼞㼢㼕㼏㼑㼟㻌㼎㼡㼟㼕㼚㼑㼟㼟

㻟㻤㻞

㻝㻘㻢㻠㻜
㻞㻜㻘㻜㻜㻜

㻝㻘㻟㻤㻡
㻢㻘㻜㻢㻟

㻠㻠㻞

㻟㻘㻢㻜㻜
㻟㻥㻢

㻟㻘㻣㻝㻢

㻝㻡㻘㻜㻜㻜

㻞㻘㻣㻜㻜㻝㻜㻘㻜㻜㻜

㻤㻣㻞㻝㻘㻤㻜㻜㻝㻠㻘㻣㻣㻟

㻟㻘㻠㻝㻡㻝㻡㻘㻠㻢㻥

㻡㻘㻜㻜㻜

㻥㻜㻜

㻜

㻞㻘㻝㻤㻠

㻜
㻲㼅㻝㻞㻛㻞㻜

㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻜

㻲㼅㻝㻞㻛㻞㻝

Note: The breakdown of operating income is before deducting administrative expenses
Source: Prepared by FISCO from the Company’s financial results

2. Financial condition and management indicators
At the end of FY12/21, current assets were up ¥1,372mn compared to the end of the previous fiscal year to¥17,319mn. This was mainly due to a ¥3,663mn increase in cash and deposits, which offset a ¥1,315mn decline
in real estate for sale, real estate for sale in process. Noncurrent assets increased ¥126mn to ¥24,882mn, primarily
due to an increase of ¥1,065mn for tools, furniture and fixtures because of the effects of repurchases of containers.
As a result, total assets rose ¥1,499mn to ¥42,202mn.

We encourage readers to review our complete legal statement on “Disclaimer” page.

11 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.

17-May-2022

8914 Tokyo Stock Exchange Standard Market

https://www.arealink.co.jp/en/ir/

Results trends

Current liabilities were down ¥917mn compared to the end of the previous fiscal year to ¥5,867mn. This mainly
owes to a decrease of ¥2,297mn in provision for loss of repurchases, which offset an increase of ¥557mn in income
taxes payable. Noncurrent liabilities decreased ¥406mn to ¥15,371mn. Main items included decreases of ¥280mn
in lease obligations and ¥157mn in corporate bonds. As a result, total liabilities decreased ¥1,324mn to ¥21,239mn.
Net assets were up ¥2,823mn compared to the end of the previous fiscal year to ¥20,963mn, mainly due to anincrease in retained earnings carried forward of ¥2,780mn.
From the above, interest-bearing debt decreased ¥433mn YoY to ¥11,944mn. The equity ratio improved significantly,
from 44.6% in the previous period to 49.7%, greatly exceeding the 32.3% average of the real estate industry on
the TSE First Section in FY3/21. Therefore, the Company can be evaluated as securing a high degree of financial
stability, and it is steadily approaching its equity ratio target of 50%. Regarding indicators of profitability, ROA was
7.3% and ROE was 16.2%, also greatly above the averages of the real estate industry on the TSE First Section in
FY3/21 of 3.1% and 6.6%, respectively.
Balance sheet and management indicators(¥mn)
FY12/20

FY12/21

Change1,372

15,947

17,319Cash and deposits

9,776

13,4403,663

Real estate for sale, real estate for sale in process

4,654

3,338

-1,31524,75524,882

126

20,356

21,217

861

55

49

-6

4,343

3,615

-728

Total assets

40,702

42,202

1,499

Current liabilities

6,785

5,867

-917

158

162

3

2,086

2,252

166

Current assets

Noncurrent assets
Property, plant and equipment
Intangible assets
Investments and other assets

Accounts payable, construction-related payables
Short-term loans payable, etc.

15,777

15,371-406

Long-term loans payable, corporate bonds, etc.

10,289

9,690

-599

(Interest-bearing debt)

12,377

11,944-433

Total liabilities

22,563

21,239-1,324

Total net assets

18,13920,963

2,823

44.6%

49.7%

5.1pt

Noncurrent liabilities

Stability
Equity ratio
Profitability
ROA (Return on Assets)

5.2%

7.3%

2.1pt

ROE (Return on Equity)

12.9%

16.2%

3.3pt

Note: Interest-bearing debt is the total of long- and short-term loans payable, corporate bonds, and lease obligations
Source: Prepared by FISCO from the Company’s financial results

At the end of FY12/21, the balance of cash and cash equivalents was up ¥3,663mn compared to the end of theprevious fiscal year to ¥13,440mn. Cash flow provided by operating activities was ¥5,741mn. The main inflows werefrom income before income taxes of ¥4,519mn, a decrease of ¥1,476mn in inventories, and the recording of ¥879mn
in depreciation, while the main outflows were from a decrease of ¥2,297mn in provision for loss on repurchases
and income taxes paid, etc. of ¥236mn. Cash flow used in investing activities was ¥1,264mn, but mainly reflects
an outflow of ¥1,822mn for the purchase of property, plant and equipment. Cash flow used in financing activitieswas ¥825mn. The main inflow was ¥2,001mn in proceeds from long-term loans payable, while the main outflows
included the repayment of long-term loans payable of ¥2,363mn.

We encourage readers to review our complete legal statement on “Disclaimer” page.

12 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Results trends

Cash flow statement(¥mn)
FY12/20

FY12/21

Cash flow from operating activities

2,520

5,741

Cash flow from investing activities-2,228-1,264

Cash flow from financing activities-2,213-825

Balance of cash and cash equivalents at
the end of the period

9,776

13,440Source: Prepared by FISCO from the Company’s financial results█ Future outlook
The new medium-term management plan targets steady sales andprofit growth in its first year, FY12/22• Outlook for FY12/22
For the FY12/22 results, the Company forecasts net sales of ¥20,600mn (up 0.1% YoY), operating income of¥3,300mn (up 8.4%), ordinary income of ¥3,200mn (up 6.3%), and net income of ¥2,100mn (down 33.8%), as
it continues to promote a shift to cumulative-type business that can generate steady income. Only net income isforecast to decline, owing to a pullback from extraordinary income recorded in the previous fiscal year. Since theCompany has a strong tendency to announce conservative forecasts in the initial plan for the fiscal year, we at
FISCO believe it is highly likely to achieve the forecasts as long as the business environment does not deteriorate.
FY12/22 results forecasts(¥mn)
FY12/21

FY12/22

YoY

Results

vs. sales

Forecasts

vs. sales

ChangeNet sales

20,572100.0%

20,600100.0%

27

Rate of change
0.1%

Operating income

3,044

14.8%

3,300

16.0%

255

8.4%

Ordinary income

3,009

14.6%

3,200

15.5%

190

6.3%

Net income

3,171

15.4%

2,100

10.2%

-1,071-33.8%

Source: Prepared by FISCO from the Company’s financial results

The results forecasts by segment are as follows.
(1) Self-storage business
The forecasts are for net sales of ¥16,000mn (up 3.4% YoY), operating income of ¥3,650mn (up 6.9%), and an
operating income margin of 22.8% (22.2% in the previous fiscal year). The Company will aim to expand and growthe cumulative-type business, centered on self-storage management. Its policy will be to establish a management
structure unaffected by conditions in the real estate and financial markets by solidifying the stable earnings
foundation from cumulative-type income.

We encourage readers to review our complete legal statement on “Disclaimer” page.

13 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.

17-May-2022

8914 Tokyo Stock Exchange Standard Market

https://www.arealink.co.jp/en/ir/

Future outlook

Self-storage management is the core business within the segment that supports the stable earnings foundation.
The Company is therefore aiming to grow and expand it further, including by developing services ancillary to
storage, raising customer satisfaction, and enhancing brand power and recognition thorough Hello Storage.
In principle, the Company plans to open properties that it will own, except for some properties. Self-storage
management profitability is therefore expected to improve further. However, the Company plans to maintainself-storage management profitability by curbing profit margins at the time of sale when conducting sales as
self-storage brokerage. Although temporary income from self-storage brokerage will not be recorded becauseof this, growth in overall self-storage business sales and profits is expected to lead to the strengthening of
cumulative-type business over the medium to long term.
(2) Land rights consolidation businessIn the land rights consolidation business, the forecasts are for net sales of ¥3,270mn (down 12.0% YoY), operating
income of ¥510mn (up 15.3%), and an operating income margin of 15.2% (11.9% in the previous fiscal year). The
Company is forecasting a decline in sales but growth in profits because it expects the operating income margin
to improve as effects emerge from steps taken in FY12/21 to improve the quality of inventory and revamp thebusiness to an appropriate scale.
(3) Other operational services businessIn other operational services business, the forecasts are for net sales of ¥1,330mn (down 4.0% YoY), operating
income of ¥340mn (down 11.1%), and an operating income margin of 26.9% (27.6% in the previous fiscal year).
This is partly because the Company withdrew from the parking business in March 2021.

㻺㼑㼠㻌㼟㼍㼘㼑㼟㻌㼒㼛㼞㼑㼏㼍㼟㼠㼟㻌㼎㼥㻌㼟㼑㼓㼙㼑㼚㼠㻿㼑㼘㼒㻙㼟㼠㼛㼞㼍㼓㼑㻌㼎㼡㼟㼕㼚㼑㼟㼟㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㼒㼛㼞㼑㼏㼍㼟㼠㼟㻌㼎㼥㻌㼟㼑㼓㼙㼑㼚㼠㻸㼍㼚㼐㻌㼞㼕㼓㼔㼠㼟㻌㼏㼛㼚㼟㼛㼘㼕㼐㼍㼠㼕㼛㼚㻌㼎㼡㼟㼕㼚㼑㼟㼟

(¥mn)

(¥mn)

㻞㻡㻘㻜㻜㻜

㻡㻘㻜㻜㻜㻻㼠㼔㼑㼞㻌㼛㼜㼑㼞㼍㼠㼕㼛㼚㼍㼘㻌㼟㼑㼞㼢㼕㼏㼑㼟㻌㼎㼡㼟㼕㼚㼑㼟㼟㻟㻠㻜㻞㻜㻘㻜㻜㻜

㻝㻘㻟㻤㻡

㻝㻘㻟㻟㻜

㻟㻘㻣㻝㻢

㻟㻘㻞㻣㻜

㻠㻘㻜㻜㻜

㻟㻤㻞
㻠㻠㻞

㻡㻝㻜

㻟㻘㻠㻝㻡

㻟㻘㻢㻡㻜

㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻞㻌㻱㻟㻘㻜㻜㻜㻝㻡㻘㻜㻜㻜

㻞㻘㻜㻜㻜㻝㻜㻘㻜㻜㻜
㻝㻡㻘㻠㻢㻥

㻝㻢㻘㻜㻜㻜
㻝㻘㻜㻜㻜

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㻜

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㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻞㻌㻱Note: Operating income is before deducting administrative expenses

 results and results briefing materials
Source: Prepared by FISCO from the Company's financial

We encourage readers to review our complete legal statement on “Disclaimer” page.

14 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/█ Growth strategy
Announced the new medium-term plan moving up initial profit
targets by one year, advancing the management plan focused on
profit growth underpinned by self-storage management
1. Summary of targets in the new medium-term management plan
In February 2021, the Company announced Medium-Term Management Plan 21-23. However, profit margins
improved significantly and results were above the targets during the first fiscal year under the plan, FY12/21.
Therefore, the Company announced in February 2022 the new medium-term management plan, which has moved
up the profit targets for FY12/23. The management targets in the new medium-term management plan are for net
sales of ¥24,000mn (up 16.7% compared to FY12/21), operating income of ¥3,800mn (up 24.8%), and ordinary
income of ¥3,700mn (up 22.9%) in FY12/24, the plan’s final year. While the operating income margin is expected to
decline in FY12/23, this is because the Company will move forward with opening investor-owned properties, which
do not contribute to earnings, to procure funds to strengthen Storage Mini* property openings. The management
plan calls for driving forward the transition to cumulative-type businesses through structural reform, and focuses
more on profit growth than sales growth.
*	S torage Mini are small-scale, indoor self-storage locations with a total of 40-60 units. They are three-story wooden
structures with total land area of around 198m2. Five have been opened as of February 2022. Being highly durable, they
will also contribute to CO2 reduction through long-term use.

While the new medium-term management plan’s management targets are ambitious, we at FISCO think the numbers
are realistic since the self-storage market in Japan is expected to have substantial growth potential. It should also
be noted that the Company is proactively promoting ESG management while pursuing profits as the industry
leader. Future ESG initiatives are also key in that the tendency for investors, mainly institutional investors, to invest
in companies that take ESG into consideration has been strengthening in recent years.

㻹㼍㼚㼍㼓㼑㼙㼑㼚㼠㻌㼠㼍㼞㼓㼑㼠㼟㻌㼕㼚㻌㼠㼔㼑㻌㼚㼑㼣㻌㼙㼑㼐㼕㼡㼙㻙㼠㼑㼞㼙㻌㼙㼍㼚㼍㼓㼑㼙㼑㼚㼠㻌㼜㼘㼍㼚㻺㼑㼠㻌㼟㼍㼘㼑㼟㻌㻔㼘㼑㼒㼠㻕㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㻔㼘㼑㼒㼠㻕㻻㼜㼑㼞㼍㼠㼕㼚㼓㻌㼕㼚㼏㼛㼙㼑㻌㼙㼍㼞㼓㼕㼚㻌㻔㼞㼕㼓㼔㼠㻕
㻔㻑㻕

(¥mn)

㻟㻜㻘㻜㻜㻜

㻝㻢㻚㻜

㻝㻡㻚㻠

㻝㻠㻚㻤

㻝㻡㻚㻤

㻝㻤㻚㻜

㻞㻡㻘㻜㻜㻜

㻝㻡㻚㻜㻞㻜㻘㻜㻜㻜

㻝㻞㻚㻜㻝㻡㻘㻜㻜㻜

㻥㻚㻜㻝㻜㻘㻜㻜㻜

㻡㻘㻜㻜㻜

㻟㻘㻜㻠㻠

㻞㻠㻘㻜㻜㻜

㻞㻞㻘㻤㻜㻜

㻞㻜㻘㻢㻜㻜

㻞㻜㻘㻡㻣㻞

㻢㻚㻜
㻟㻘㻡㻜㻜

㻟㻘㻟㻜㻜

㻟㻘㻤㻜㻜

㻜

㻟㻚㻜
㻜㻚㻜

㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻞㻌㻱㻲㼅㻝㻞㻛㻞㻟
㻔㼠㼍㼞㼓㼑㼠㻕

㻲㼅㻝㻞㻛㻞㻠
㻔㼠㼍㼞㼓㼑㼠㻕

Source: Prepared by FISCO from the Company's results briefing materials

We encourage readers to review our complete legal statement on “Disclaimer” page.

15 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Growth strategy

Self-storage management remains the pillar under the new medium-term management plan. The plan is for self-storage management to drive earnings growth (especially profit growth), while earnings increase slightly or hold steadyin the land rights consolidation business and the other operational services business.
An overview for each segment is as follows.
(1) Self-storage businessIn the self-storage business, the Company aims to enhance the quality of self-storage. In addition to continuous
on-site improvements for both containers and self-storage with land, the Company looks to significantly upgrade
both exteriors and interiors. It will also work to enhance efficiency through “cockpit management.” It will strengthen
and expand Storage Mini property openings. The Company is also considering resuming some self-storage
brokerage in the future, and plans on sales to investors, which do not contribute to earnings, to procure funds tobolster Storage Mini property openings.
(2) Land rights consolidation businessIn the land rights consolidation business, the Company aims to stabilize earnings in the brokerage business. By
promoting a shift from a rapid-growth to a steady-earning business, it looks to raise the inventory turnover ratio
and achieve high efficiency.
(3) Other operational services businessIn other operational services business, the Company aims to maintain stable earning sources. With rental offices
and asset management as the two pillars, it will maintain high occupancy rates. Also, it will make periodic capital
investments to promote long-term use.
2. Priority measures
As its basic policy, the Company has discontinued a management and growth strategy that relies on trading(brokerage) and is instead aiming for growth centered on self-storage management. In addition to instability caused
by market conditions, the trading (brokerage) that the Company has engaged in so far has presented other issues,
such as the extreme difficulty of managing large-scale storage with land that is expected to be traded. Therefore,
after analyzing case studies to date, the Company has set the following four main measures: (1) implement the
management philosophy, (2) change life in Japan with self-storage, (3) grow through cumulative-type businesses
centered on self-storage management, and (4) realize per-head management.
(1) Implement the Management Philosophy- “Above and Beyond” Declaration
The Company has set its management philosophy as “Provide convenience, enjoyment, and excitement to theworld through products and services,” its mission as “Change life in Japan with self-storage,” its vision as “Be
the undisputed leader in the self-storage industry,” and its value as ““Above and Beyond” Declaration—Increase
the Self-Storage Fans” (thoroughly implementing the management philosophy).
The “Above and Beyond” declaration and implementation of the management philosophy are interrelated. In short,the idea is that actions that are conscious of the Company’s philosophy guidelines will result in actions that go“Above and Beyond,” which will lead to implementation of the philosophy guidelines.

We encourage readers to review our complete legal statement on “Disclaimer” page.

16 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Growth strategy(2) “Change Life in Japan with Self-Storage” – Make Self-Storage an Essential Part of Society
According to the Company, about 13.5mn or 10.6% of total households in the US use self-storage. Meanwhile,the number of self-storage units currently being supplied in Japan is about 600,000, which equates to only about
1.1% of the number of total households. So based on simple calculations comparing Japan and the US, it canbe said that there is potential for future development of Japan’s self-storage market to 10 times its current scale.
From the perspective of everyday living, however, if “home” in Japan is redefined as “a comfortable space to leada good life,” there could be even more potential for future development of Japan’s self-storage market than basedon simple calculations comparing Japan and the US (currently room to grow ten-fold). That is because storage
space is one element for living comfortably, and self-storage could become a pillar for that.
Against this self-storage market backdrop, the Company thinks it can “Change life in Japan with self-storage,”
and is undertaking various activities to promote the spread of self-storage. To give an example, the Company
is backing up the Japan Self Storage Association’s activities, and planning major events aiming to increaseawareness and development of self-storage (trunk room) business. It also aims to realize a recycling-basedsociety through self-storage. In addition to fostering a culture that values things through the use of self-storage,
and thereby helping to reduce waste, it will promote the construction of eco-conscious self-storage facilities andtheir long-term use to help reduce CO2 emissions.
(3) Grow through Cumulative-Type Businesses Centered on Self-Storage Management
Since FY12/19, the Company has promoted a policy for the earnings foundation to be self-storage management, acumulative-type business that stably accumulates monthly income. As a result, cumulative-type businesses’ shareof operating income increased to 89.7% in FY12/21 (from 50.7% in FY12/19). The Company aims to grow further
moving ahead by steadily making improvements and maintaining the cumulative-type business ratio at about 90%.
To achieve growth in cumulative-type businesses, the Company plans to accelerate self-storage property openings. It is speeding up property openings from FY12/22, aiming to open 3,900 units in FY12/24 and 10,000 units
in FY12/30. As for specific measures, it aims to enhance customer satisfaction by raising the level of self-storage
service (service development, site improvement) and expand use, in addition to steadily expanding Storage
Mini. Also, it will promote greater management efficiency through “cockpit management.” In addition to thesemeasures, there is room for opening self-storage properties as there are few restrictions on opening locations,and the Company can obtain information on candidate locations for openings as it has built a network with realestate companies nationwide. Based on this, we at FISCO think the targets are attainable.

We encourage readers to review our complete legal statement on “Disclaimer” page.

17 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Growth strategy㻺㼡㼙㼎㼑㼞㻌㼛㼒㻌㼚㼑㼣㻌㼡㼚㼕㼠㼟㻌㼜㼘㼍㼚㼚㼑㼐㻔㼡㼚㼕㼠㼟㻕

㻡㻘㻜㻜㻜
㻟㻘㻥㻜㻜

㻠㻘㻜㻜㻜
㻟㻘㻜㻜㻜
㻟㻘㻜㻜㻜
㻞㻘㻟㻜㻜
㻞㻘㻜㻜㻜

㻝㻘㻢㻝㻠

㻝㻘㻜㻜㻜

㻜
㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻞
㻔㼠㼍㼞㼓㼑㼠㻕

㻲㼅㻝㻞㻛㻞㻟
㻔㼠㼍㼞㼓㼑㼠㻕

㻲㼅㻝㻞㻛㻞㻠
㻔㼠㼍㼞㼓㼑㼠㻕

Source: Prepared by FISCO from the Company’s results briefing materials

Storage Mini
Trunk House 24
Todoroki-cho

Trunk House 24
Kasukabe Mashitomi

Interior of Storage Mini

Source: The Company’s results briefing materials(4) Realize Per-head Management <Human Resource Development/Arealink Master>
The Company will also strengthen human resource development to achieve the new medium-term management
plan. While it is maintaining a management structure of a small number of highly skilled employees, its perhead (per-employee) ordinary income topped ¥40mn in FY12/21 alongside a rise in the ratio of cumulative-typebusiness. Moving ahead, it looks to raise efficiency further and targets per-head profit of ¥50mn in FY12/25. Asa source for realizing per-head management, it is introducing the Arealink Master system and promoting humanresource development. Through the Arealink Master system, it aims to equip rank-and-file employees with work
skills to think ahead and take action, and strengthen the management capabilities of management (executives
and upper-level management) through the continued raising of issues and working out of fundamental solutions.

We encourage readers to review our complete legal statement on “Disclaimer” page.

18 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.
8914 Tokyo Stock Exchange Standard Market

17-May-2022
https://www.arealink.co.jp/en/ir/

Growth strategy

Ordinary income per employee

Source: The Company’s results briefing materials█ Shareholder return policy
In FY12/22, will maintain the dividend payout ratio at above 30%
after excluding extraordinary income-loss
Returning profits to shareholders is an important management issue for the Company, which it fundamentally
performs through paying dividends. Its basic policy is to pay a single dividend at the end of the fiscal period,
targeting a dividend payout ratio of 30%. It decides on the dividend based on its medium- to long-term businessplan and while observing the market environment and the timing of capital investment, comprehensively taking into
consideration factors such as securing internal funds, its financial condition, and the level of profits.
The Company paid a dividend of ¥47.0 per share (up ¥16.0 from the previous fiscal year) in FY12/21 based on
results after excluding extraordinary loss. Also, it plans to increase its dividend per share by ¥3.0 YoY to ¥50.0 in
FY12/22, for a dividend payout ratio of 30.1%.
Due to changes in the management policy, the Company plans to stably increase profits going forward centered ona cumulative-type business based on the new medium-term management plan. Therefore, we at FISCO think thatfurther dividend increases can be expected by achieving results.

We encourage readers to review our complete legal statement on “Disclaimer” page.

19 20

COMPANY RESEARCH AND ANALYSIS REPORTFISCO Ltd.
https://www.fisco.co.jp

Arealink Co., Ltd.

17-May-2022

8914 Tokyo Stock Exchange Standard Market

https://www.arealink.co.jp/en/ir/

Shareholder return policy㼀㼞㼑㼚㼐㼟㻌㼕㼚㻌㼐㼕㼢㼕㼐㼑㼚㼐㻌㼜㼑㼞㻌㼟㼔㼍㼞㼑㻌㼍㼚㼐㻌㼠㼔㼑㻌㼐㼕㼢㼕㼐㼑㼚㼐㻌㼜㼍㼥㼛㼡㼠㻌㼞㼍㼠㼕㼛㻰㼕㼢㼕㼐㼑㼚㼐㻌㼜㼑㼞㻌㼟㼔㼍㼞㼑㻌㻔㼘㼑㼒㼠㻕

(¥)
㻡㻢㻚㻜

㻰㼕㼢㼕㼐㼑㼚㼐㻌㼜㼍㼥㼛㼡㼠㻌㼞㼍㼠㼕㼛㻌㻔㼞㼕㼓㼔㼠㻕

㻔㻑㻕
㻟㻡㻚㻜

㻟㻝㻚㻢㻌

㻟㻜㻚㻝㻌

㻠㻤㻚㻜

㻟㻜㻚㻜

㻠㻜㻚㻜

㻞㻡㻚㻜
㻝㻣㻚㻢㻌

㻟㻞㻚㻜

㻞㻠㻚㻜

㻝㻤㻚㻣㻌

㻠㻣㻚㻜

㻠㻢㻚㻜

㻞㻜㻚㻜
㻡㻜㻚㻜

㻝㻡㻚㻜

㻠㻜㻚㻜
㻝㻢㻚㻜

㻝㻜㻚㻜

㻟㻝㻚㻜㻌

㻤㻚㻜

㻡㻚㻜

㻜㻚㻜

㻜㻚㻜
㻲㼅㻝㻞㻛㻝㻤

㻲㼅㻝㻞㻛㻝㻥

㻲㼅㻝㻞㻛㻞㻜

㻲㼅㻝㻞㻛㻞㻝

㻲㼅㻝㻞㻛㻞㻞㻌㻱

Source: Prepared by FISCO from the Company’s financial results

We encourage readers to review our complete legal statement on “Disclaimer” page.

20 20

Disclaimer
FISCO Ltd. (“FISCO”) offer stock price and index information for use under the approval of theTokyo Stock Exchange, the Osaka Stock Exchange and Nikkei Inc.
This report is provided solely for the purpose of offering information, and is not a solicitationof investment nor any other act or action.
FISCO prepared and published this report based on information which it considered reliable;
however, FISCO does not warrant the accuracy, completeness, fitness nor reliability of thecontents of this report or the said information.
The issuers’ securities, currencies, commodities, securities and other financial instruments
mentioned in this report may increase or decrease in value or lose their value due to influence
from corporate activities, economic policies, world affairs and other factors. This report does
not make any promises regarding any future outcomes. If you use this report or any information
mentioned herein, regardless of the purpose therefor, such use shall be made based on yourjudgment and responsibility, and FISCO shall not be liable for any damage incurred by you asa result of such use, irrespective of the reason.
This report has been prepared at the request of the company subject hereto based on theprovision of information by such company through telephone interviews and the like. However,
the hypotheses, conclusions and all other contents contained herein are based on analysis
by FISCO. The contents of this report are as of the time of the preparation hereof, and are
subject to change without notice. FISCO is not obligated to update this report.
The intellectual property rights, including the copyrights to the main text hereof, the data
and the like, belong to FISCO, and any revision, reprocessing, reproduction, transmission,
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may currently or in the future trade or hold the financial instruments or the securities of issuersthat are mentioned in this report.
Please use the information in this report upon accepting the above points.

◾ For inquiry, please contact: ◾

FISCO Ltd.
5-13-3 Minami Aoyama, Minato-ku, Tokyo, Japan 107-0062
Phone: 03-5774-2443 (IR Consulting Business Division)
Email: support@fisco.co.jp