Investment Bridge Announces Investment Opinion: Bridge Report on Leopalace21 Issued: Strong Growth in First Half Earnings,

  Investment Bridge Announces Investment Opinion: Bridge Report on Leopalace21
  Issued: Strong Growth in First Half Earnings, Continued Growth Expected in
  Sales, Profits in Full Year FY3/14

NOTE TO EDITORS: The following is an investment opinion issued by Investment

Business Wire

TOKYO -- December 4, 2013

Investment Bridge, one of Japan’s leading independent IR services companies,
has released a “Bridge Report” on Leopalace21 Corporation (TOKYO:8848)
reviewing its first half fiscal year March 2014 earnings results and its
estimates for full fiscal year March 2014.

  *Sales and operating income rose by 5.3% and 183.0% year-over-year during
    the first half of FY3/14 on the back of a brisk recovery in the
    construction business and continued high occupancy rates in the leasing
  *Leopalace21’s earnings estimates for the full fiscal year March 2014
    remain unchanged, and call for sales and operating income to grow by 2.9%
    and 90.2% year-over-year on strength of both the leasing and construction
    businesses and improvements in overall gross margins resulting from higher
  *The Bridge Report highlights the appearance of successful results of
    Leopalace21’s theme of a “New Growth Stage” inherent in its midterm
    business plan “Creating Future” reflected in the strong earnings results.

Leopalace21 Corporation conducts construction, leasing, and sales of
apartments, condominiums, and other residential properties, in addition to
operation of hotels and resorts, and senior citizen care services. Increases
in sales of the all of the Company’s divisions during the first half of the
current term contributed to total consolidated sales to grow by 5.3%
year-over-year to JPY231.6 billion. At the same time, improvement in
profitability of the construction business from a loss in the previous term to
an operating income of JPY970 million, and a strong 48.8% year-over-year
growth in leasing business operating income allowed consolidated operating
income to rise by a large 183.0% year-over-year to JPY5.3 billion.

Leopalace21 maintained its existing full year earnings estimates, and calls
for sales to increase by 2.9% year-over-year to JPY467.4 billion on increases
in all of its divisions with the exception of a marginal decline in sales of
its silver (Senior citizen) services business. At the same time, operating
income is expected to grow by a large margin of 90.2% year-over-year to
JPY14.1 billion due to improvements in overall gross margins resulting from
higher sales and strong improvements in profitability of both the leasing and
construction businesses. Net income is expected to decline 17.5%
year-over-year to JPY11.0 billion due to the disappearance of foreign exchange
translation gains and tax adjustments. While Leopalace21 is expected to
continue to forgo paying a dividend during the current term, it seeks to
reinstate payments at an early stage.

The Bridge Report issued by Investment Bridge highlights the relatively high
levels of occupancy rates currently being seen as a reflection of the
successful efforts of Leopalace21’s midterm business plan entitled “Creating
Future.” The report also calls attention to the announcement of third quarter
earnings and further details of occupancy rate trends as indications of how
earnings are likely to trend during the remainder of the second half.

To view the full report, please go to the following.

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.


Investment Bridge Co., Ltd.
Kaoru Hosaka for Leopalace21 Corporation
+81-3-5842-5765 (Japanese correspondence only) (English and Japanese correspondence)
Press spacebar to pause and continue. Press esc to stop.