SUN FRONTIER FUDOUSAN CO., LTD. Sun Frontier Fudousan Co., Ltd. Business Report
Shareholder Newsletter 2023
Fiscal Year Ended March 31, 2023
Stock Code: 8934
To our Shareholders
Summary of 24th Fiscal Year
Real Estate Revitalization Business Drives Sales and Profits With Net Sales and Net Profit Reaching Record Highs
We hope that things are going well with all of our shareholders, and would like to express our sincere gratitude for your continued patronage.
Regarding the business environment surrounding our corporate group in the 24th term, restrictions on activities due to COVID-19 were eased and economic activities were normalized, but we saw the emergence of risks on many fronts, such as economic stagnation and financial instability caused by rising interest rates in Europe and the United States, and conflicts among nations. While paying close attention to such market trends, our corporate group will continue to pursue its corporate philosophy of"Not for profit, but for trust. By eliminating customers'anxiety and complaints, we produce results exceeding expectations. We work hard and do our best to gain customers'trust!"Under this policy, all employees have been striving to solve customers' problems with autonomy and initiative. In particular, in the office business division, we steadily sold renovated properties that were turned into high-performance and high-value-added buildings in collaboration with all divisions. As a result, it significantly drove the group's earnings. In addition, hotel sales in the hotel development business and a recovery in the hotel management business, driven by the easing of restrictions on socioeconomic activities, drove performance. As a result, business performance in that term greatly exceeded initial forecasts, with net sales and ordinary income growing 16.2% and 20.5%, respectively, year on year and net sales reaching a record high. In addition, profit attributable to owners of parent reached a record high due to the reduction in taxable income from loss carried forward and tax effects from the recognition of deferred tax assets.
Increasing Term-End Dividends
We increased the term-end dividend for the 24th term by 2 yen from the initial forecast of 23 yen to 25 yen, and the annual dividend, including the interim dividend, was 48 yen. For the next fiscal year, we plan to pay interim and term-end dividends of 26 yen each, for a total annual dividend of 52 yen. We will continue to strive for a continuous and stable return of profits and to increase the entire group's corporate value to meet our shareholders' expectations and be worthy of their support.
Aspiring to Achieve Sustainable Growth Based on the Medium-Term Management Plan
Our corporate group is currently implementing its medium-term management plan, which will end in the 26th term (the fiscal year ending March 31, 2025). With"provide the world with a place where people can gather, communicate with each other, promote social development and bring happiness"as our basic policy, we are working to resolve social issues through our business, and we have set quantitative targets of net
sales of 100 billion yen, an ordinary income of 20 billion yen, and a net income of 14 billion yen.
This 25th term is a key year for achieving the goals of the current medium-term management plan. While aiming to achieve the plan, we will work to further strengthen our human resources base and business foundation, which will serve as the foundation of management for sustainable growth. In particular, we believe that the recruitment and development of human resources is the most important issue that will determine the success or failure of our growth. Since its founding, our corporate group has focused on human resource development and grown its business with the growth of our employees. Going forward, we will further strengthen our investment in human capital, drawing on the strengths of our people to increase corporate value and provide sustainable returns to our shareholders.
Contributing to the Realization of a Sustainable Society
In these turbulent times, the environment surrounding our business is undergoing major changes, but regardless of the circumstances, our group will continue to engage in our business with integrity to help solve social issues with the spirit of"altruism,"which is our credo, and contribute to the realization of a sustainable and prosperous society.
We would like to ask for the continued support and encouragement of our shareholders.
June, 2023
Sun Frontier Fudousan Co., Ltd.
President Seiichi Saito
01 Sun Frontier Fudousan Co., Ltd. Business Report
Consolidated Business Report (Performance Highlights)
Points of Consolidated Financial Results
- In the real estate revitalization business, which is the mainstay, sales of highly profitable and high-quality properties remained steady this term, too. Although sales and profit declined year on year due to the concentration of sales of relatively large properties in the same period of the previous year, profit margin continued to exceed that of the previous year and continued to strongly drive company-wide performance.
- In the hotel management business, occupancy rates and room rates rapidly recovered owing to the increased flow of people and positive factors such as government support for tourism and an increase of bookings by tourists visiting Japan in the second half. In the hotel development business, the sale of two hotels was completed at the end of October, recording a development profit.
Variations in Sales and Profit/Loss
■ Net Sales (million yen)
Year-end | Interim | ||
82,777 | |||
73,218 | 71,251 | ||
59,632 | |||
40,635 | 45,326 | 35,333 | |
32,164 | |||
2020.3 | 2021.3 | 2022.3 | 2023.3 |
- Ordinary Profit (million yen)・ Ordinary Profit Ratio（%）
Year-end Interim
Ordinary Profit Ratio
16,127 | |||
22.0 | 14,722 | ||
12,215 | |||
17.8 | |||
17.1 | |||
11,042 | 12.6 | ||
9,285 | 8,035 | ||
7,524 | |||
5,384 | |||
2020.3 | 2021.3 | 2022.3 | 2023.3 |
- Profit attributable to owners of
parent (million yen)・Net income per share(¥)
Year-end Interim
Net income per share
219.03 | 238.98 | ||
10,666 | 152.26 | 11,612* | |
7,542 | 87.77 | 7,415 | |
5,862 | |||
5,368 | |||
4,274 | |||
3,459 | |||
2020.3 | 2021.3 | 2022.3 | 2023.3 |
*Profit attributable to owners of parent grew significantly and reached a record high, influenced by positive factors specific to this fiscal year, such as the reduction in taxable income resulting from the recovery of the hotel and tourism business and the tax effect from the recognition of deferred tax assets.
Composition of Sales by Segment | Summary of Consolidated Financial Statements | ||||
Hotel and Tourism Business | Other | (Unit: million yen) | |||
152,519 | 152,519 | ||||
27.5% | 2.1% | 136,512 | 136,512 | ||
Current liabilities | |||||
Sales: 11,967 million yen | Sales: 1,788 million yen | Current liabilities | 16,363 | ||
Up 232.3% year on year | Up 5.5% year on year | 16,210 | Non-current | ||
Current | |||||
Real Estate Service | Current | Non-current | liabilities | ||
assets | |||||
Business | assets | 125,886 | liabilities | 52,190 | |
10.6% | 110,920 | Inventory | 45,849 | ||
Inventory | （ assets ） | ||||
Sales: 8,843 million yen | （ assets ） | 80,182 | |||
Up 23.6% year on year | 77,340 | Net | Net | ||
assets | |||||
Real Estate | assets | ||||
83,965 | |||||
Revitalization Business | Total | 74,452 | |||
Non-current | Non-current | ||||
59.8% | |||||
assets | assets | ||||
Sales: 50,066 million yen | Sales: 82,777 million yen | 25,591 | 26,633 | ||
Up 16.2% year on year | 2022.3 | 2023.3 | 2022.3 | 2023.3 | |
Down 10.5% year on year |
Sun Frontier Fudousan Co., Ltd. Business Report 02
Medium term Management Plan
Contributing to Solving Social Issues by Completing the Medium-Term Management Plan
Our corporate group has been working on a medium-term management plan with its final year set as the term ending March 2025. Amid changes in the business environment due to the spread of the novel coronavirus and the transition to the"new normal,"we were able to flexibly change ourselves and return to a growth track. As per our basic policy, we will upgrade all businesses according to our priorities and work to solve social issues by achieving our goals.
Basic Policy | Providing"a place where people gather and communicate with each other, | |
and create social development and happiness for people" | ||
■ Growth strategies
Office | Deepen and expand the Office Business |
Hotel | Provide satisfaction and excitement going beyond customers'expectation with a sharp concept |
Overseas | Expand residential related business in Vietnam |
M&A | Invest in start-ups and peripheral businesses to expand our current business |
Key Points
Points to focus on in order to grasp the changes of the times and upgrade business operations and management
(1)ESG (2)Digital (3)Cash flow (4)Marketing
FY2025/3 Target
Net sales | 100 billions yen |
Ordinary profit | 20 billions yen |
Net profit* | 14 billions yen |
Ordinary profit | More than 20% |
margin | |
Equity ratio | Around 50% |
ROE | More than 10% |
*Net profit attributable to owners of the parent
(100 millionsyen) ■ Net sales ■ Ordinary profit | ■ Net profit* | 1,000 | |||||||
1,000 | |||||||||
830 | |||||||||
827 | |||||||||
800 | 732 | ||||||||
712 | |||||||||
600 | 533 | 596 | |||||||
400 | 200 | ||||||||
161107 | |||||||||
200 | 128 | 88 | 75 44 | 122 | 74 | 147 | 160 | 140 | |
0 | 116 | 110 | |||||||
FY2019/3 | FY2020/3 | FY2021/3 | FY2022/3 | FY2023/3 | FY2024/3 | FY2025/3 | |||
(forecast) | (forecast) |
03 Sun Frontier Fudousan Co., Ltd. Business Report
Strategy in Office Business
Our real estate revitalization and real estate service businesses are centered in the five central wards of Tokyo. In the office business, we differentiate ourselves with our expertise in central Tokyo and provide comprehensive real estate services to solve all kinds of customer problems.
12Arakawa
Toshima
R P
Of the total number of RP buildings, 460buildings, 80% are in the five cities of central Tokyo
Nakano
1114
and adjacent cities. *As of the end of March 2023
Bunkyo Taito
21
Shinjuku 73 133
Chiyoda
L M |
Community based 10 branches
Ginza, Kanda, Nihonbashi, Kodemmacho, Kojimachi, Shinjuku,Shibuya,Gotanda,Hamamatsucho, Yokohama
Of the 457 entrusted properties,
41
Shibuya
Chuo
P M |
over 80% are in the five cities of
central Tokyo *As of the end of March 2023
Ｐ Ｍ （ビル管理）
48
11 Minato
Meguro
8 Shinagawa
- The numbers on the columns in the map are the cumulative number of RP buildings.
B M
Rent Guarantee
Rental
Conference
Room
Of the 222 buildings under comprehensive management, 85% are in the five cities of
central Tokyo. | *As of the end of March 2023 |
Of the 749 new contracts signed, 90% are in the five cities of central Tokyo.
*As of the end of March 2023
19 of the 18 sites are in the five cities of central Tokyo.
*As of the end of March 2023. The rest of one is in Yokohama
ビ ルメン
テナンス
滞 納 賃 料
保 証
貸 会 議 室
In Tokyo, a city with a high concentration of people and businesses, we will contribute to the development of the economy by providing high-quality real estate stock that forms the foundation of the economy, while contributing to the formation of a sustainable society by creating resilient real estate.
■ Ratio of Tokyo population to Japanese population (estimate) | ■ Top 10 Prefectures in Number of Corporations | |||||||||
Population | Population | Population of Tokyo as a percentage | Tokyo | 575,234 | ||||||
in Tokyo | of Japan | of the population of Japan | ||||||||
(Thousand people) | Osaka | 223,407 | ||||||||||
160,000 | 127,768 | 127,095 | 25.0% | Kanagawa | 184,363 | |||||||
140,000 | 122,544 | 115,216 | Aichi | 153,694 | ||||||||
120,000 | 126,926 | 128,057 | 125,325 | 119,125 | 106,421 | 20.0% | ||||||
Saitama | 130,108 | |||||||||||
100,000 | 15.0% | |||||||||||
11.1% 11.4% | 11.7% 11.9% 12.6% | Hokkaido | 119,564 | |||||||||
80,000 | 9.5% | 9.8% | 10.3% | 10.6% | ||||||||
10.0% | Chiba | 107,704 | ||||||||||
60,000 | ||||||||||||
40,000 | 12,064 12,577 13,159 13,515 13,850 13,979 13,938 13,75413,458 | 5.0% | Hyogo | 94,013 | ||||||||
20,000 | Fukuoka | 83,562 | ||||||||||
0 | 2000 | 2005 | 2010 | 2015 | 2020 | 2025 | 2030 | 2035 | 2040 | 0.0% | Shizuoka | 76,981 |
Source: Compiled by the Company based on Tokyo Metropolitan Government statistics "Population of Tokyo (Estimated)"
Source: Compiled by the Company based on the National Tax Agency's "Number of Corporations by Prefecture"
Sun Frontier Fudousan Co., Ltd. Business Report 04
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Sun Frontier Fudousan Co. Ltd. published this content on 28 June 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 28 June 2023 09:02:04 UTC.
