Tokyu : Summary of Results for the year ended March, 2024 (Transcript)

Summary of Results for the year
	ended March, 2024
May 13, 2024	9005	https://www.tokyu.co.jp/

FY2023 Main Points in the Results (1)

▎Comparison with the previous fiscal year

• Operating revenue and operating profit both increased mainly due to fare revisions in Tokyu Railways and Increase in condominium sales in the Real estate business, in addition to recovery of demand in Railway and Hotel business.
• Profit attributable to owners of parent rose chiefly due to an increase in share of profit of entities accounted for using equity method in addition to increased operating profit.

	FY2022	FY2023	YoY
(Unit : Billion yen)	Results	Results	Comparison

Operating Revenue	931.2	1,037.8	+106.5
（+11.4%）
Operating Profit	44.6	94.9	+50.3
（+112.8%）

FY2023	Comparison with
Feb. Forecast	Feb. Forecast

1,041.4 -3.5

（-0.3%）

90.0 +4.9

（+5.5%）

Real Estate Sales Operating Profit	6.6	+10.9
17.6

17.8

-0.2

（+165.7%）

（-1.5%）

Operating Profit excluding	37.9	+39.3
	77.2

72.1

+5.1

Real Estate Sales			（+103.5%）
Business Profit	45.2	95.5	+50.3
（+111.3%）
Recurring Profit	47.3	99.2	+51.9
（+109.6%）
Profit attributable to	25.9	63.7	+37.7
owners of parent	（+145.3%）

（+7.2%）

90.3 +5.2

（+5.7%）

93.8 +5.4

（+5.9%）

60.0 +3.7

（+6.3%）

• Business Profit = Operating Profit + Investment gains (loss) from equity method (excl. listed companies) + Dividend Income related to Real Estate Business, etc.

© 2024 TOKYU CORPORATION All Rights Reserved.

〇 This slide shows key points in the results for FY2023. Operating revenue stood at 1,037.8 billion yen, and operating

profit was 94.9 billion yen.

Operating revenue and operating profit both increased 106.5 billion yen and 50.3 billion yen year on year, respectively, mainly due to fare revisions in Tokyu Railways and an increase in condominium sales, in addition to recovery of demand in each business, particularly in the Transportation Business and Hotel and Resort Business.

〇 Profit attributable to owners of parent stood at 63.7 billion yen, up 37.7 billion yen, chiefly due to an increase in share of profit of entities accounted for using equity method in addition to increased operating profit.

〇 Compared to forecasts in February, results exceeded the expectations in all segments, mainly because the commission rents remained strong in real estate leasing. Operating profit exceeded the forecast by 4.9 billion yen, and profit attributable to owners of parent was 3.7 billion yen above the forecast value.

FY2023 Operating Profit by Segment: Financial Results Key Points

Tokyu Hotels, etc. +4.0

(Hotel and Resort：

Increase in profit due to lower energy costs +1.3)

Real Estate Sales +10.9

Real Estate Leasing +3.8

Hotel business of the Company +3.7

(Real Estate： Increase in profit due to lower energy costs +0.0)

Tokyu Railways, etc. +20.7
Tokyu Bus・Tokyu Transses +1.0	+4.8
(Transportation：	+19.8

Increase in profit due to lower energy costs +0.1)

(Billion yen)

Retail +1.2

‒ Tokyu Store Chain +1.3

‒ Tokyu Department Store -0.5

(Retail：Increase in profit due to lower energy costs +0.6)

ICT and Media +0.8

( ICT and Media ：Decrease in profit due to higher energy costs -0.1)

+2.0 ±0.0 94.9

+23.5

44.6

Increase in profit due to lower energy costs +1.9

© 2024 TOKYU CORPORATION All Rights Reserved.

〇 A year-on-year comparison of operating profit by segment reveals a 23.5 billion yen increase in the Transportation Business, reflecting the recovery of human mobility.

In the Real Estate Business, operating profit increased 19.8

billion yen in total due to the strong performance in the Hotel

business of the Company, in addition to an increase in condominium sales in real estate sales. In the Hotel and Resort Business, the average daily rate (ADR) of hotels remained strong, resulting in a 4.8 billion yen increase in profit. Thus operating profit increased in all businesses.

〇 Note that electricity rates and other energy costs amounted to

27.3 billion yen for the year, down 1.9 billion yen from the previous year.

Consolidated Financial Results for FY2023

• Operating profit continued to exceed pre-COVID levels as a result of the progress of structural reforms in each business in addition to the gradual recovery of the business environment from the COVID crisis.

Consolidated Operating Revenue and Operating Profit Trends

1,345.0 (Billion yen)

1,164.2			Operating Revenue		Operating Profit
					165
1,145.0							1,037.8
		935.9	879.1	931.2
945.0
							115
745.0							94.9
68.7
545.0
							65
						44.6
345.0					31.5
145.0							15
-55.0
-255.0		-31.6			-35
	FY2019	FY2020	FY2021	FY2022	FY2023

© 2024 TOKYU CORPORATION All Rights Reserved.

〇 The graph shows trends in operating revenue and operating profit from FY2019.

〇 The operating profit of 94.9 billion yen for FY2023 is above the pre-COVID-19 level and is a record-high for Tokyu Corporation, exceeding the 86.7 billion yen posted in FY2007.

		FY2023 Results	Segment Information (1)	Transportation
				FY2022	FY2023	Change	Remarks	Forecast	Change
				Results	Results	as of Feb.
			(Unit:Billion yen)
Operating Revenue		184.0	213.6	+ 29.6	Passengers Carried: +6.4% (Non-commuter: +6.4%; Commuter: +6.4%)	214.1	- 0.4
	（+ 16.1%）	┌ Passenger Revenue: +20.5% (Non-commuter: +22.0%; Commuter: +18.2%)	（- 0.2%）
		Tokyu Railways		134.8	159.3	+ 24.4	Passenger Revenue: 144.9 (+24.6)	158.5	+ 0.7
						（+ 18.1%）			（+ 0.5%）
		Tokyu Bus・Tokyu Transses	25.4	27.2	+ 1.8	Passenger Revenue: +6.9%	27.2	+ 0.0
						（+ 7.2%）			（+ 0.1%）
		Others		23.7	27.1	+ 3.3		28.3	- 1.1
			（+ 14.1%）		（- 4.2%）
Operating Profit		8.5	32.0	+ 23.5		31.5	+ 0.5
	（+ 275.5%）		（+ 1.8%）
		Tokyu Railways		7.6	28.4	+ 20.7		27.6	+ 0.8
						（+ 270.1%）			（+ 2.9%）
		Tokyu Bus・Tokyu Transses	0.8	1.8	+ 1.0		2.2	- 0.3
		（+ 118.5%）		（- 15.5%）
		Others		- 0.0	1.7	+ 1.7		1.6	+ 0.1
			（－）		（+ 6.6%）

▎Tokyu Railways: Breakdown of operating expense

FY2022

(Unit : Billion yen) Results

FY2023 2023-2022

Results

Change

Total operating expense	127.5	131.1	+3.5
Labor cost	32.5	33.5	+1.0
Power Costs	8.6	8.4	-0.2
Repair Costs	10.1	10.6	+0.5
Expensess	35.2	36.8	+1.4
Various taxes	6.7	6.9	+0.2
Depreciation and amortization	34.3	34.6	+0.3

© 2024 TOKYU CORPORATION All Rights Reserved.

• Operating revenue was 213.6 billion yen, with operating profit of 32.0 billion. This represents a 29.6 billion yen increase in operating revenue and 23.5 billion yen rise in operating profit year on year.
• In the railway business, Tokyu Railways generated 159.3 billion yen in operating revenue and 28.4 billion yen in operating profit, recording year- on-year increases in operating revenue and operating profit of 24.4 billion and 20.7 billion yen, respectively.
  The number of passengers carried increased 6.4%. Revenue from fares rose 20.5%, partly due to the fare revision, driving a 24.6 billion yen increase in operating revenue.
• Compared with FY2019 levels, the number of passengers carried was down 11.4% while passenger revenue increased 3.0%.
• Expenses increased 3.5 billion yen in total due in part to higher labor costs.
• Tokyu Bus posted operating revenue of 27.2 billion yen and an operating profit of 1.8 billion yen, with operating revenue and operating profit recording year-on-year increases of 1.8 billion and 1.0 billion yen, respectively.

• The Other segment, including the airport operation, regional transportation, and other operations, generated an operating profit of 1.7 billion yen, resulting in year-on-year profit growth of 1.7 billion yen.
• Profit was 0.5 billion yen above the forecast in November, as passenger revenue remained strong in January and February.

Railway Operations Business (1)

Conditions in 4Q

(Jan. - Mar.)

Conditions in April

The number of passengers carried gradually recovered with an increase in opportunities to go out as a result of the downgrading of COVID-19 to a Class 5 infectious disease.

The number of passengers carried is about +3% in comparison with FY2023 levels.

Tokyu Railways: Passengers Carried and Passenger Revenue

		FY2022	FY2023	VS
	(Thousand people, Million yen)	Results	Results	FY2022	FY2019
Number of	Total	988,883	1,052,143	＋6.4%		- 11.4%
Passengers	Non-commuter	445,985	474,541	＋6.4%		＋2.1%
Carried	Commuter	542,898	577,602	＋6.4%		- 20.0%
Passenger	Total	120,341	144,986	＋20.5%		＋3.0%
Non-commuter	73,422	89,548	＋22.0%		＋18.0%
Revenue
	46,919	55,438	+ 18.2%
	Commuter		- 14.6%

FY2024	VS
Full Year Forecast.	FY2023	FY2019
1,064,206	+ 1.1%	- 10.4%
480,365	+ 1.2%	+ 3.3%
583,841	+ 1.1%	- 19.2%
147,227	+ 1.5%	+ 4.6%
90,685	+ 1.3%	+ 19.5%
56,542	+ 2.0%	- 12.9%

Tokyu Railways: Passengers Carried (Year-on-year Comparison / FY2019 Comparison)

50.0
（Unit: %）
40.0
30.0
20.0
10.0
0.0
-10.0
-20.0
-30.0
-40.0
-50.0	22/04	22/05	22/06	22/07	22/08	22/09	22/10	22/11	22/12	23/01	23/02	23/03	23/04	23/05	23/06	23/07	23/08	23/09	23/10	23/11	23/12	24/1	24/2	24/3
YoY Comparison Commuter	3.8	7.6	8.2	7.7	6.6	9.2	9.1	6.7	5.4	5.2	7.1	6.6	6.8	6.2	5.6	6.1	6.8	6.4	6.0	5.6	5.9	6.3	9.8	5.7
YoY Comparison Non-Commuter	12.7	29.6	17.8	8.5	19.1	19.1	10.3	4.1	2.9	15.4	28.6	14.9	8.6	6.3	4.4	10.6	12.5	8.0	4.6	5.5	5.8	3.9	5.2	2.6

		FY2019 Comparison Commuter	-25.8	-24.6	-25.1	-22.6	-26.3	-38.3	-21.7	-24.4	-14.7	-26.4	-30.6	-11.6-20.7-20.0-20.8	-17.9	-21.3	-34.4	-17.0	-20.2	-9.7	-21.8	-23.8	-6.6
		FY2019 Comparison Non-Commuter	-10.8	-8.1	-5.9	-11.2	-14.6	-9.6	2.1	-6.9	-5.6	-5.8	0.3	39.1 -3.2-2.3-1.7	-1.8	-3.9	-2.4	6.8	-1.9	-0.2	-2.1	5.6	42.8

© 2024 TOKYU CORPORATION All Rights Reserved.

FY2023 Results

Segment Information (2)

Real Estate

		FY2022	FY2023	Change	Remarks	Forecast	Change
		Results	Results	as of Feb.
	(Unit:Billion yen)
Operating Revenue	220.4	286.5	+ 66.1		290.7	- 4.1
（+ 30.0%）		（- 1.4%）
	Real Estate Sales	41.1	85.6	+ 44.5		88.5	- 2.8
	（+ 108.2%）		（- 3.2%）
	Real Estate Sales of the Company	34.5	79.9	+ 45.4	Increase in number of properties sold	82.4	- 2.5
				（+ 131.5%）			（- 3.1%）
	Real Estate Leasing	117.3	127.1	+ 9.7		127.2	- 0.0
	（+ 8.3%）		（- 0.1%）
	Real Estate Leasing of the Company	100.6	109.8	+ 9.1		109.2	+ 0.5
	（+ 9.1%）		（+ 0.5%）
	Real estate Management	29.8	32.0	+ 2.2		32.1	- 0.0
	（+ 7.4%）		（- 0.2%）
	Others	32.0	41.7	+ 9.6	Hotel business of the Company:23.4 (+10.3)	42.8	- 1.1
				（+ 30.2%）			（- 2.6%）
Operating Profit	28.8	48.7	+ 19.8		46.0	+ 2.7
（+ 68.9%）		（+ 5.9%）
	Real Estate Sales	6.6	17.6	+ 10.9		17.8	- 0.2
	（+ 165.7%）		（- 1.5%）
	Real Estate Sales of the Company	5.4	17.4	+ 12.0	Increase in number of properties sold	17.6	- 0.1
				（+ 220.6%）			（- 1.0%）
	Real Estate Leasing	19.4	23.2	+ 3.8		20.8	+ 2.4
	（+ 19.7%）		（+ 11.5%）
	Real Estate Leasing of the Company	15.8	19.1	+ 3.2		16.8	+ 2.2
	（+ 20.4%）		（+ 13.3%）
	Real Estate Management	3.5	4.7	+ 1.1		4.4	+ 0.2
	（+ 33.7%）		（+ 6.3%）
	Others	- 0.7	3.0	+ 3.8	Hotel business of the Company: 3.7 (+3.7)	2.7	+ 0.2
				（－）			（+ 10.5%）

© 2024 TOKYU CORPORATION All Rights Reserved.

〇The Real Estate Business posted operating revenue of 286.5 billion yen and operating profit of 48.7 billion yen.

This represents a 66.1 billion yen increase in operating revenue and 19.8 billion yen rise in operating profit year on year.

〇 In Real Estate Sales, operating revenue was 85.6 billion yen with operating profit of 17.6 billion yen, year-on-year increase of

• 1. billion yen and 10.9 billion yen respectively, mainly due to an increase in the number of condominiums delivered. 。
• The Real Estate Leasing Business posted operating revenue of
• 1. billion yen and operating profit of 23.2 billion yen. Operating revenue increased 9.7 billion yen and operating profit rose 3.8 billion yen year on year, reflecting the opening of Tokyu Kabukicho Tower and a business recovery especially in commercial facilities.
• Other of the Real Estate Business posted operating revenue up
• 1. billion yen and operating profit increasing 3.8 billion yen year on year.

In the Hotel business of the Company, where earnings from the hotels in the complexes owned by the Company were posted, operating revenue rose 10.3 billion yen from previous year to

• 23.4 billion yen, and operating profit increased 3.7 billion yen to 3.7 billion yen, attributable to a significant rise in average daily rate (ADR) which mainly reflects inbound tourism demand.

• Operating profit exceeded the forecast as of February by 2.7 billion yen thanks to the strong performance of real estate leasing and hotels.

FY2023 Results

Segment Information (3)

Retail

	FY2022	FY2023	Change
	Results	Results
(Unit:Billion yen)
Operating Revenue	332.8	331.9	- 0.8
（- 0.3%）
Tokyu Department Store	66.9	58.8	- 8.0
（- 12.0%）
Tokyu Store Chain	209.9	214.6	+ 4.7
（+ 2.3%）
Others	56.0	58.4	+ 2.3
（+ 4.3%）
Operating Profit	4.3	5.5	+ 1.2
（+ 27.9%）
Tokyu Department Store	0.3	- 0.2	- 0.5
（－）
Tokyu Store Chain	3.8	5.1	+ 1.3
（+ 36.1%）
Others	0.2	0.6	+ 0.4
（+ 208.7%）

Remarks		Forecast	Change
	as of Feb.
		330.0	+ 1.9
		（+ 0.6%）
Rate of Change in Sales: All Stores: -23.0%	Existing Stores -6.7%	58.4	+ 0.4
Rate of Change in Total sales (including leasing) : Existing Stores: +6.5%	（+ 1.3%）
Rate of Change in Sales: All Stores: +1.8%	Existing Stores: +2.0%	214.4	+ 0.2
（+ 0.1%）
		57.1	+ 1.2
		（+ 2.3%）
		4.6	+ 0.9
		（+ 21.3%）
		0	- 0.3
		(－)
		4.1	+ 1.0
		（+ 24.0%）
		0.3	+ 0.2
		（+ 77.6%）

© 2024 TOKYU CORPORATION All Rights Reserved.

〇 In the Life Service Business, operating revenue was 518.8 billion yen with operating profit of 13.1 billion yen, corresponding to year-on-year increases of 1.5 billion yen and

• 2.0 billion yen, respectively.

• In the Retail Business, operating revenue was 331.9 billion yen with operating profit of 5.5 billion yen, corresponding to a year- on-year decrease of 0.8 billion and an increase of 1.2 billion yen, respectively.
• Tokyu Department Store posted operating revenue of 58.8 billion yen and an operating loss of 0.2 billion yen.
  Operating revenue declined due to the closure of the flagship store in Shibuya and the remodeling floors from own sales to rental sales in Tama Plaza store, Kichijoji store, etc.. Despite ongoing improvements in operational efficiency, operating profit decreased 0.5 billion yen year on year.
  Sales at all existing stores including tenants, excluding the effect of the closure of the flagship store, rose from a year ago.
• Tokyu Store Chain posted operating revenue of 214.6 billion yen and operating profit of 5.1 billion yen. Operating revenue and operating profit rose 4.7 billion yen and 1.3 billion yen, respectively, mainly due to the rise of product prices.