Corporate Results

The following is Leopalace21's corporate results.

Leasing Business

Although the average occupancy rate during the six months was 90.99%, up 0.79p year-on-year, the occupancy rates at the end of September was 88.40% (-1.81p year-on-year) due to the suspension of new tenant recruitment into apartments subject to top-priority investigations.

In the Leasing Business, both occupancy rates and profits decreased because we suspended recruitment of new tenants into buildings subject to top-priority investigations which impacts tenant matching. Although the average occupancy rate during the six months was 90.99%, up 0.79p year-on-year, the occupancy rates at the end of September was 88.40% (-1.81p year-on-year) due to the suspension of new tenant recruitment into apartments subject to top-priority investigations. We implemented measures such as tenant recruitment utilizing direct leasing offices, franchises, and local real estate brokers, as well as expanding tenant services including "my DIY" and security system installations. In addition, the Group further strengthened sales against corporate and foreign clients. "my DIY" contracts have exceeded 41 thousand. Apartments with security systems installed increased, and accounted for 303 thousand rooms (52.9% of the total units) at the end of September 2018.
The number of units under management at the end of the second quarter was 572,972 (up 2,300 from the end of the previous fiscal year), and the number of direct offices was 189 (no change from the end of the previous fiscal year). The number of franchise offices was 114 (decreasing 4 from the end of the previous fiscal year).

Occupancy Rate

Occupancy rate

Related information

Development Business

We are promoting apartment supply in urban areas and expanding construction variations.

Orders decreased under the negative environment surrounding the apartment construction industry, orders received during the first half was 34,258 million yen (down 9.6% year-on-year), and orders received outstanding was 65,854 million yen (down 3.2% year-on-year).
In the Development Business, the Group focused on supplying apartments to urban areas with high occupancy demand, offering high-quality and strategic products with earthquake protection and sound insulation, and developing products targeting females and young tenants. Also, the Group expanded construction variations such as elderly care facilities, stores, and built-to-order houses, as well as advanced initiatives to boost profit margins via reassessments of product prices, procurement routes. Subsidiary Life Living Co., Ltd. provides development business of condominiums and apartments and subsidiary Morizou Co.,Ltd., provides luxury custom-built homes made with Kiso-hinoki. The number of offices was 50 (decreasing 10 from the end of the previous fiscal year), of which 7 offices are real estate development only.

Orders Received

Order results

Sales

Consolidated net sales were 255,479 million yen.

Consolidated net sales during the second quarter were 255,479 million yen (down 1.3% year-on-year). Net sales in the Leasing Business were 219,025 million yen (up 0.7% year-on-year), and 26,748 million yen in the Development Business (down 16.5% year-on-year).

Sales by segment

Sales by segment

Profits

Operating profit was 7,192 million yen (down 48.6% year-on-year)

Gross profit was 44,588 million yen (down 9.8% year-on-year), operating profit was 7,192 million yen (down 48.6% year-on-year), recurring profit was 7,159 million yen (down 48.2% year-on-year). An extraordinary loss of 7,145 million yen was recorded as a reserve for losses related to parting wall deficiencies confirmed in certain apartments constructed by the Company, resulting in net loss attributable to shareholders of the parent of 5,819 million yen (compared to a net income of 9,488 million yen in the same period of the previous year).

In the Leasing Business, operating profit was 12,180 million yen (down 24.2% year-on-year). In the Development Business, operating loss was 1,301 million yen (compared to an operating profit of 974 million yen in the same period of the previous year).

Profits

Profits

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FY March 2019 2Q



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    February 8 ,2019
    Announcement of business results for the nine months ended December 31, 2018



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