Sumitomo Realty Forecasts Profit Increase on Leasing RevenueKathleen Chu
Sumitomo Realty & Development Co., Japan’s third-biggest developer, said it expects full-year profit to rise 14 percent for the current business year on higher leasing income and home sales.
Net income will increase to 68 billion yen ($671 million) for the year ending March 2014 from 59.8 billion yen, the Tokyo-based company said in a statement through the stock exchange today. Revenue will gain 3.2 percent to 760 billion yen, it said.
Sumitomo Realty joins Mitsui Fudosan Co. and Mitsubishi Estate Co. in forecasting a profit gain after the company’s vacancy rate fell to 7.1 percent in March from 7.8 percent a year earlier. Sumitomo Realty separately said today that it plans to expand office leasing and residential sales and start overseas businesses to achieve an operating profit of 500 billion yen on sales of 2.5 trillion yen over the next three years through March 2016.
Operating profit for Sumitomo’s leasing business, which accounts for more than half of the total, will rise 3 percent to 97 billion yen for the current fiscal year after the opening of two new office buildings in Tokyo, the company said today.
Similar profit for its residential business will gain 5.3 percent to 41 billion yen as it to sell 8.8 percent more apartments, houses and land sites, the developer said.
Net income in the 12 months ended March 31 gained 12 percent from 53.2 billion yen a year earlier, the developer said. Sales rose 7 percent to 736.7 billion yen last fiscal year.
Sumitomo Realty’s shares fell 4.2 percent to 4,480 yen at the close of trading on the Tokyo Stock Exchange. The stock has advanced 57 percent this year, compared with the 54 percent advance by the 44-member Topix Real Estate Index.