Investment Bridge Announces Investment Opinion: Bridge Report on Leopalace21 Issued: Improvement in FY3/13 Earnings Expected to Continue in FY3/14 NOTE TO EDITORS: The following is an investment opinion issued by Investment Bridge Business Wire TOKYO -- June 12, 2013 Investment Bridge, one of Japan's leading independent IR services companies, has released a "Bridge Report" on Leopalace21 Corporation (TOKYO:8848) reviewing its fiscal year March 2013 earnings results and its forecasts for fiscal year March 2014. *FY3/13 consolidated sales fell by a small margin of 1.1% year-over-year due to a decline in sales of the construction business. However operating income benefitted from improvements in the leasing business profitability and grew by a large margin of 61.7% from the previous term. Foreign exchange translation gains resulting from the weaker yen and taxes adjustments contributed to large increases in ordinary and net incomes of 372.1% and 739.2% year-over-year. *Leopalace21 calls for a small increase in sales of 2.9% and a large rise in operating income of 90.2% year-over-year on the back of continued improvements in profitability of the leasing business during FY3/14. Disappearance of foreign exchange translation gains and tax adjustments are expected to contribute to a lesser 10% year-over-year increase in ordinary income and a 17.5% year-over-year decline in net income. *The Bridge Report calls attention to Leopalace21's ability to achieve profitability at the operating level without relying upon reversals from vacancy loss reserves as significant progress in Leopalace21's strategy of restoring stable profitability. Leopalace21 Corporation conducts construction, leasing, and sales of apartments, condominiums, and other residential properties, in addition to operation of hotels and resorts, and elderly care services. Increases in sales of the leasing, hotels and resort, and elderly care businesses were offset by a 15.2% year-over-year decline in sales of the construction business and caused total sales to fall by 1.1% year-over-year to JPY454.2 billion in FY3/13. At the same time, improvements in profitability of the leasing business helped to offset lower profits in the construction business and contributed to a 61.7% year-over-year increase in operating income to JPY7.4 billion. During FY3/14, Leopalace21 seeks to increase sales in both the leasing and construction businesses by 1.4% and 14.5% year-over-year to JPY389.0 and JPY61.1 billion respectively. A large increase in operating income of 90.2% year-over-year to JPY14.1 billion is also expected due to higher sales and improvements in gross profitability. However, the disappearance of foreign currency translation gain and income tax adjustments of JPY5.5 and JPY4.6 billion that occurred in FY3/13 is expected to contribute to a 17.5% year-over-year decline in net income to JPY11.0 billion. The Bridge Report also highlights the fact that full year profitability at the operating level was achieved without having to rely upon reversal of vacancy loss reserves as a reflection of significant progress in Leopalace21's strategy of restoring stability to its earnings. In addition, the Report calls for attention to be paid to Leopalace21's new efforts including its solar power generation business designed to leverage its stock of 550,000 rooms managed nationwide and leveraging of its know-how in its overseas business deployment as called for by its New Midterm Business Plan entitled "Creating Future". To view the full report, please go to the following. http://www.bridge-salon.jp/report_bridge/archives/eng/8848/20130612.html About Bridge Report: Bridge Report is produced by Investment Bridge Co., Ltd. and provides accurate and objective information about the earnings, business strategies, and other information of publicly traded Japanese companies. Contact: Investment Bridge Co., Ltd. Kaoru Hosaka for Leopalace21 Corporation +81-3-5842-5765 (Japanese correspondence only) firstname.lastname@example.org (English and Japanese correspondence)
Investment Bridge Announces Investment Opinion: Bridge Report on Leopalace21 Issued: Improvement in FY3/13 Earnings Expected to
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