Leopalace21 Records Solid Growth in Both Sales and Profits, in FY3/14, Growth Expected to Continue in FY3/15

  Leopalace21 Records Solid Growth in Both Sales and Profits, in FY3/14,   Growth Expected to Continue in FY3/15  Business Wire  TOKYO -- June 17, 2014  Leopalace21 Corporation (TOKYO:8848), a company that conducts construction, leasing, and sales of apartments, condominiums, and residential housing, announced that its sales and operating, recurring and net incomes rose by 3.7%, 84.4%, 4.4%, and 14.2% year-over-year to JPY471.0, JPY 13.6, JPY11.5, and JPY15.2 billion respectively during the fiscal year March 2014. This strong earnings performance is attributed to gradual improvements in the overall Japanese economy, a rush to purchase real estate and other high priced items ahead of the hike in the consumption tax from April 2014, and subsequent strength in the housing market which recorded its second consecutive year of increases in new housing starts.  Due to these favorable business conditions, all of Leopalace21’s businesses were able to record sales growth. In the main leasing business, sales and operating income rose by 1.4% and 79.2% year-over-year to JPY388.7 and JPY15.5 billion respectively on the back of a rise in the average occupancy rates of 1.64% points year-over-year to 84.58%. A strategy of focusing upon major metropolitan regions with high occupancy rates contributed to relatively strong growth in sales and operating income of the construction business of 18.3% and 7.5% year-over-year to JPY63.1 and JPY2.9 billion respectively.  Total consolidated assets rose by JPY25.8 billion from the end of the previous term to JPY287.4 billion at the end of the term just ended due primarily to increases in cash and deposits, tangible fixed assets, and deferred tax assets of JPY18.0, JPY13.5, and JPY5.4 billion respectively. At the same time, total liabilities declined by JPY20.9 to JPY182.5 billion over the same period. The main factors behind this decline included declines in interest bearing liabilities, short and long term advances received, and vacancy loss reserves of JPY11.7, JPY8.7, and JPY4.5 billion respectively. Over the same period, net assets rose by a relatively large margin of JPY46.7 to JPY104.8 billion due in part to increases in capital arising from the issuance of new shares and retained earnings derived from net income. Consequently, equity ratio improved by a large 14.3% points from the end of the previous term to 36.5%.  During the coming fiscal year March 2015, Leopalace21 calls for sales and operating and recurring incomes to rise by 4.8%, 6.0% and 12.3% year-over-year to JPY493.5, JPY14.5 and JPY13.0 billion respectively. At the same time, the disappearance of deferred tax assets booked in the previous year is expected to cause net income to decline by 21.2% year-over-year to JPY12.0 billion.                                                                    Leopalace21           FY3/12   FY3/13   FY3/14   yy chg  FY3/15E  yy chg Corporation (8848) Sales                 459,436  454,222  471,089  3.7%    493,500  4.8% Operating Income      4,585    7,413    13,673   84.4%   14,500   6.0% Margin                1.0%     1.6%     2.9%     na      2.9%     na Recurring Income      2,349    11,091   11,574   4.4%    13,000   12.3% Net Income            1,588    13,335   15,229   14.2%   12,000   -21.2% Earnings Per Share    9.4      74.5     67.2     -9.8%   45.7     -32.0% (Units: Million Yen, EPS and Dividend in Yen, E=estimates)   Sales and Operating Profit by segments Sales             FY3/13   FY3/14   yy chg Leasing           383,574  388,768  1.4% Construction      53,369   63,135   18.3% Hotel, Resort     6,657    7,571    13.7% Silver (Senior)   9,482    10,171   7.3% Others            1,137    1,442    26.8% Adjustments       -        -        na TOTAL             454,222  471,089  3.7% Operating Profit                   Leasing           8,687    15,567   79.2% Construction      2,747    2,954    7.5% Hotel, Resort     -1,005   -1,118   na Silver (Senior)   -742     -610     na Others            35       137      291.4% Adjustments       -2,308   -3,256   na TOTAL             7,413    13,673   84.4% (Units: Million Yen)   About Leopalace21 Corporation  Leopalace21 Corporation was established in August 1973 and conducts construction, leasing, and sales of apartments, condominiums, and residential housing, in addition to development and operation of resort facilities, and the operation of hotel business, broadband business, and elderly care business. The Company was first listed on the JASDAQ Market in February 1989, and moved its shares to the First Section of the Tokyo Stock Exchange in March 2004. Its headquarters are currently located in Tokyo.  Contact:  for Leopalace21 Corporation Investment Bridge Co., Ltd. Kaoru Hosaka, +81-3-5842-5765 (Japanese correspondence only) leopalace21@cyber-ir.co.jp (English and Japanese correspondence)  
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