Resorttrust : Financial results Presentation For the 6-month Period Ended June 30, 2021

RESORTTRUST

FINANCIAL DATA

CONSOLIDATED FINANCIAL SUMMARY

2Q FY 2020 (from Apr. 1, 2020 to Sept. 30, 2020)

securities code	4681
（：	）

CONSOLIDATED FINANCIAL SUMMARY

For the Second Quarter Ended Sept. 30, 2018, 2019 and 2020

				(Millions of yen)
		2Q		Fiscal Year
	Apr.-Sept.	Apr.-Sept.	Apr.-Sept.	2020/3	2021/3
	2018	2019	2020	Result	Revision Targets
Net sales	77,334	84,197	86,276	159,145	165,000
Operating income	6,074	8,501	9,980	11,652	11,000
Ordinary income	6,507	8,750	11,159	12,476	13,000
Net income (interim)	3,998	5,499	5,696	7,135	6,200
Net assets	125,925	134,725	137,369	132,991
Assets	402,491	412,420	419,166	400,833
Net income per share (yen)	37.40	51.38	53.21	66.65
(Primary)
Net income per share (yen)	34.40	47.32	49.00	61.29
(Fully Diluted)
Equity ratio (%)	30.2	31.5	31.6	31.9
Return on assets (%)	-	-	-	3.11
Return on equity (%)	-	-	-	5.59
Net cash provided by	(5,132)	(1,302)	(4,640)	19,096
(used in) operating activities
Net cash provided by	9,191	(12,785)	(22,764)	(8,247)
(used in) investment activities
Net cash provided by	(9,030)	10,311	32,999	(13,364)
(used in) financing activities
Cash and cash equivalents	27,500	20,118	26,963	21,376

Business Results

Overview of 2Q The Fiscal Year 2020 (Ending March 31, 2021)

1. Summary of Business Results

			(Millions of Yen)
	2Q FY2019	2Q FY2020	Year-on-Year
	(Results)	(Results)	Change
Net sales	84,197	86,276	+2.5%
Operating income	8,501	9,980	+17.4%
Ordinary income	8,750	11,159	+27.5%
Net income	5,499	5,696	+3.6%

The Japanese economy during the three-month period under review saw shrinking economic activities due to the global spread of COVID-19, and many companies are being forced to restrict their business activities. The future outlook remains extremely uncertain, with no signs of the ending of the outbreak.

Under these circumstances, various factors had large impacts on the Company Group's business operations during the period of April-June: membership sales activities were restricted and shrank in Membership Operations due to people refraining from non-essential and non-urgent movements and a significant decrease in the number of foreign tourists visiting Japan as a result of the spread of COVID-19 in Japan; some hotels and other facilities were closed in Hotel and Restaurant Operations; and health check-up facilities were closed, and the intake of new occupants in senior residences slowed in Medical Operations.

Amid such a situation, sales activities centered on membership businesses remained resilient during the period of July- September. While overseas travel was restricted, people's motivation for domestic travel started to pick up mainly owing to the government-led "Go to Travel Campaign. " Due to growing demand for luxury resorts as well as rising health consciousness and increasing demand for membership medical services attributable to avoidance of medical institutions, sales of high-grade hotel memberships, high-priced travel plans, and medical memberships recovered more than anticipated. In addition, YOKOHAMA BAYCOURT CLUB and THE KAHALA HOTEL & RESORT YOKOHAMA opened as scheduled in September, and real estate profits that had been deferred were booked in a lump sum.

Even in the midst of the COVID-19 crisis, we reconfirmed the strengths of the membership business as our membership holders continued to use our hotels and introduce potential membership customers. To meet the expectations of our membership holders and customers, the Group is carrying out the "lifetime" strategy that addresses new normals, by renewing our commitment to the "characteristics of the membe rship system" and strengthening and creating more o f connections between people, while implementing the Group's unique measures against the 3Cs, providing information that makes use of knowledge gained in Medical Operations, and offering telephone consultations to our membership holders.

As mentioned above, owing to the impact of the spread of COVID-19, recognition of profits associated with the opening of the membership hotel, and other factors, net sales were JPY 86,276 million (+2.5% yoy), operating income was JPY 9,980 million (+17.4% yoy), ordinary income was JPY 11,159 million (+27.5% yoy), and net income attributable to owners of parent was JPY 5,696 million (+3.6% yoy).

"Loss due to new COVID-19 infection" of 2,972 milli on yen was recorded as an extraordinary loss during the first quarter of the fiscal year. A further loss of 570 million yen was recorded during the second quarter, bringing the total "loss due to new COVID-19 infection" recorded for the first half of the fiscal year to 3,542 million yen.

2. Summary of Business Segments
【Membership Operations】			(Millions of Yen)
	2Q FY2019	2Q FY2020	Year-on-Year
	(Results)	(Results)	Change
Net sales	22,164	42,036	+89.7%
Operating income	8,147	14,390	+76.6%

Membership Operation Segment recorded higher sales and higher income, as YOKOHAMA BAYCOURT CLUB opened in September 2020 and real estate profits that had been deferred were booked in a lump sum, and sales of high-grade hotel memberships, whose demand increased due to restrictions on overseas travel, remained strong.

In the period of April-June, the volume of membership sales compared to the same period of the previous year declined due to the impact of the spread of COVID-19 restricting sales activities especially in the Tokyo metropolitan area and preventing face-to-face sales activities that are the Group's strength.

Under such circumstances, we continuously take on challenges for the future, including studying measures for telework and other new sales styles and new sales channels such as via the internet and business partners.

【Hotel and Restaurant Operations】		(Millions of Yen)
	2Q FY2019	2Q FY2020	Year-on-Year
	(Results)	(Results)	Change
Net sales	42,167	25,143	(40.4%)
Operating income	1,478	(3,181)	-

Hotel and Restaurant Operation Segment recorded lower sales and lower income. Lower numbers were attributable to the closure of facilities in the period of April-June due to the impact of the government's request to refrain from non-essential and non-urgent outings resulting from the spread of COVID-19, reduced hotel occupancy rates caused by a drop in consumer confidence for travel and sightseeing, especially by a decline in the usage by corporate employees and groups and for weddings, banquets, and conferences, and non-membership hotels, in particular, being hit by a sharp fall in the number of foreign tourists visiting Japan and business travelers. Meanwhile, since July, with hotel occupancy rates on a recovery trend partly due to the reassurance the guests have found in our operation of membership facilities, sales of high-priced plans have been robust and spending per visitor has been trending upward, which have also been supported by growing demand for travel owing to the government-led "Go t o Travel Campaign."

Under such circumstances, we continue to create sustainable value for our business by implementing the Group's own measures against the 3Cs that leverage knowledge gained in Medical Operations and pursuing safe and secure services that are unique to the membership system.