Financial Review

Consolidated Results for FY2023 (December 1, 2022 to November 30, 2023)

During the subject fiscal year in the Japanese economy, the normalization of socioeconomic activities progressed due to the recategorization of COVID-19 as a Class 5 infectious disease while the domestic economy trended toward a gradual recovery. In contrast, the outlook for the global economy remained uncertain due to such factors as the prolonged situation in Ukraine, increasing tensions in the Middle East, soaring global fuel and resource prices, the yen’s ongoing depreciation, and global monetary tightening centered mainly in Europe and the United States.
In the real estate industry, of which the Samty Group is a part, with regard to rental apartments, occupancy rates, rent levels, and property sales prices have remained favorable, because they are not easily affected by economic trends or the effects of the COVID-19 pandemic. In the hotel industry, the occupancy rate and average room price reached roughly their pre-COVID-19 levels due to nationwide travel support and an increase in the number of inbound visitors to Japan following the yen’s depreciation, while demand for domestic and international travel recovered steadily.
In such a business environment, supported by the strong investment appetite of domestic and overseas institutional investors, we sold 126 properties of real estate for sale, including of the Samty brand S-RESIDENCE rental apartment series. With regard to the purchase of properties, we are making progress while giving consideration, from a variety of angles, to a range of market trends, such as interest rates and transaction price and cap rates. In addition, as announced in the "Notice Concerning Postponement of Financial Results Announcement for Fiscal Year Ended November 2022 and Establishment of Special Investigation Committee," dated January 16, 2023, one-time expenses of ¥0.9 billion relating to a special investigation committee to analyze and consider the status of transactions with specific business partners that were identified in the Group have been recorded as Special investigation expenses, etc. under Extraordinary loss.
As a result, for the subject fiscal year, net sales amounted to ¥198.6 billion (up 54.6% from the previous fiscal year), with operating profit of ¥19.5 billion (up 38.7%), ordinary profit of ¥15.8 billion (up 9.8%), and profit attributable to owners of parent of ¥10.3 billion (down 5.2%).

Assets
Total assets at the end of the subject fiscal year amounted to ¥413.4 billion, a decrease of ¥0.1 billion compared with the end of the previous fiscal year. The main factors for the change were a ¥21.3 billion decrease in real estate for sale, real estate for sale under construction and property, plant and equipment, an ¥8.8 billion increase in investments and other assets, and a ¥0.7 billion decrease in cash and deposits.
Liabilities
Total liabilities at the end of the subject fiscal year amounted to ¥302.3 billion, a decrease of ¥0.8 billion compared with the end of the previous fiscal year. The main factors contributing to the decrease were a ¥17.7 billion decrease in short-term borrowings, an increase of ¥23.6 billion in the current portion of long-term borrowings, and a decrease of ¥34.2 billion in long-term borrowings.
Net Assets
Total net assets at the end of the subject fiscal year amounted to ¥111.1 billion, an increase of ¥0.7 billion compared with the end of the previous fiscal year. The main contributory increases/decreases were: an increase in retained earnings of ¥6.1 billion; a decrease of ¥6.0 billion in non-controlling interests and an increase of ¥0.7 billion in foreign currency translation adjustment.