Note: The accompanying consolidated financial statements were not audited since they have been prepared only for reference purposes only. All statements are based on "Kessan Tanshin" report prepared in accordance with the provisions set forth in the accounting regulations and principals generally accepted in Japan.
Summary of Consolidated Financial Results for the Fiscal Year ended December 31, 2020
[Based on Japanese GAAP]
February 15, 2021
Listed company name: | MUGEN ESTATE Co., Ltd | Listed Stock Exchange: Tokyo Stock Exchange |
Securities code: | 3299 | URLhttps://www.mugen-estate.co.jp/en/ |
Representative: | Shinichi Fujita, President | |
Contact: |
Akira Okubo, Director, General Manager of Administrative Divisionir@mugen-estate.co.jp
Scheduled date of general shareholders' meeting: March 25, 2021 Scheduled date of dividend payment: March 26, 2021 Scheduled date of securities report submission: March 25, 2021 Supplementary material for financial results: Yes Financial results briefing: No
(fractions of one million yen are rounded off)
1. Consolidated financial results for the fiscal year ended December 31, 2020 (1) Consolidated financial results
(Percentages represent changes from the previous year.)
Net sales | Operating income | Ordinary income | Profit attributable to owners of parent | |||||
FY2020 FY2019 | Million yen 34,858 39,677 | % ሺ12.1) ሺ26.4) | Million yen 2,465 3,157 | % ሺ21.9) ሺ47.2) | Million yen 1,785 2,493 | % ሺ28.4) ሺ52.4) | Million yen 599 1,688 | % ሺ64.5) ሺ49.7) |
(Note) Comprehensive income
FY2020
599
million yen(
-64.5%)FY2019
1,688 million yen( -49.7%)
Net income per share | Diluted net income per share | Return on equity | Ordinary income to total assets | Operating income to net sales | |
FY2020 FY2019 | Yen 24.98 69.38 | Yen 24.86 69.10 | % 2.6 7.6 | % 2.7 3.7 | % 7.1 8.0 |
Operating income to
(Reference)Equity in earnings (losses) of affiliatesFY2020
ʵ million yen
FY2019
ʵ million yen
(2) Consolidated financial position
Total assets | Net assets | Equity ratio | Net assets per share | |
As of December 31, 2020 As of December 31, 2019 | Million yen 62,487 68,512 | Million yen 22,605 22,840 | % 36.0 33.2 | Yen 939.11 943.48 |
(Reference)
Shareholders' EquityAs of December 31, 2020
22,518 million yen
As of December 31, 2019 22,718 million yen
(3) Consolidated cash flows
Cash flows from operating activities | Cash flows from investing activities | Cash flows from financing activities | Cash and cash equivalents at end of period | |
FY2020 FY2019 | Million yen 10,981 3,276 | Million yen (1,944) (872) | Million yen (6,656) 712 | Million yen 14,649 12,268 |
Cash and cash equivalents
2. Dividends
Dividends per share | Total amount of dividends (Annual) | Dividend payout ratio (Consolidated) | Ratio of dividends to net assets (Consolidated) | |||||
End of 1st quarter | End of 2nd quarter | End of 3rd quarter | Year-end | Total | ||||
FY2019 FY2020 | Yen ʵ ʵ | Yen 0.00 0.00 | Yen ʵ ʵ | Yen 30.00 10.00 | Yen 30.00 10.00 | Million yen 722 239 | % 43.2 40.0 | % 3.3 1.1 |
FY2021 (forecast) | ʵ | 0.00 | ʵ | 10.00 | 10.00 | 36.8 |
Ratio of dividends
3. Forecast of consolidated financial results for the fiscal year ending December 31, 2021
(from January 1, 2021 to December 31, 2021)
(Percentages represent changes from the previous year)
Net sales | Operating income | Ordinary income | Profit attributable to owners of parent | Net income per share | |||||
FY2021 | Million yen 35,412 | % 1.6 | Million yen 1,916 | % (22.3) | Million yen 1,315 | % ሺ26.3) | Million yen 651 | % 8.8 | Yen 27.17 |
* Notes
(1) Changes in significant subsidiaries during the period (changes in specified subsidiaries resulting in a change in the scope of consolidation): None
(2) Changes in accounting policies, changes in accounting estimates and restatement
(i) | Changes in accounting policies due to revisions to accounting standards and other regulations | : None |
(ii) | Changes in accounting policies other than (i) | : None |
(iii) | Changes in accounting estimates | : None |
(iv) | Restatement | : None |
(3) Number of shares issued (common stock)
(i) Number of shares outstanding at end of the period (including treasury stock)
FY2020 24,361,000 shares FY2019 24,361,000 shares
(ii) Number of treasury stock held at end of the period
FY2020 382,309 shares FY2019 281,559 shares
(iii) Average number of shares outstanding during the period
FY2020 23,982,816 shares FY2019 24,344,805 shares
* Consolidated financial statements (Japanese GAAP) are not subject to audit procedure.
* Explanation of the proper use of financial forecasts and other important notes
(1) Financial forecasts
The statements about the future included in this report, including financial forecasts, are based on information currently available to the Company and certain assumptions that are considered reasonable, which do not guarantee the achievement of such projected results. Actual results may vary considerably from these projections due to a range of factors. See "(4) Outlook of FY2020" under "1. Operating Results and Financial Position" on page 3 of the Accompanying Materials for the assumptions of the financial forecasts and points to note in the use of financial forecasts
(2) Access to presentation materials for financial results
Presentation materials are disclosed through TDnet and on the Company's website on the day on which the presentation is made. Every year, we hold a financial results briefing for institutional investors and analysts. However, we have decided to cancel it,considering the health and safety of all participants and related parties in light of the spread of the COVID-19. Presentation video of the financial results will be available on our website in late February.
Accompanying Material - Contents
1. Operating Results and Financial Position
(1) Analysis of Operating Results ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 2
(2) Analysis of Financial Positions ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 2
(3) Analysis of Cash Flows ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 2
(4) Outlook for FY2021 (January 1, 2021 to December 31, 2021) ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 3
(5) Basic Policy for Dividend Distribution and Dividends for FY2020 and FY2021 ʜʜʜʜʜʜʜʜʜʜʜ 3
2. Basic Perspective on Selection of Accounting Standards ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 3
3. Consolidated Financial Statements
(1) Consolidated Balance Sheets ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 5
(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income ʜʜʜʜʜʜ 7
(3) Consolidated Statements of Changes in Net Assetsʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 9
(4) Consolidated Statements of Cash Flows ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 10
(Segment information) ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 12
(Per share information) ʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜʜ 14
1. Operating Results and Financial Position (1) Analysis of Operating Results
During the consolidated fiscal year under review (January 1 through December 31, 2020), because the issue of the declaration of a state of emergency in April due to impacts of the COVID-19 pandemic, the Japanese economy rapidly deteriorated, reflecting a sharp decline in corporate earnings and a substantial fall in consumer spending. Although signs of an uptick were seen thanks to the effects of all sorts of political measures, new infections rapidly increased from October. Impacts on social and economic activities and changes in the financial and capital markets need to be monitored.
In the real estate industry where the MUGEN ESTATE Group operates, activities related to the real estate trading were restricted, supply of some construction materials was delayed and suspended, and real estate investors increasingly showed wait-and-see attitudes due to the impact of the COVID-19 pandemic in the first half. However, the recovery of demand for condominiums was seen in the second half because social and economic activities gradually normalized and real estate prices did not substantially collapse. In the used condominiums market in the Tokyo metropolitan area, working style corresponding to a new lifestyle is beginning to take root. Consequently, demand for used condominiums outside the central Tokyo area is on the rise. However, COVID-19 infections are spreading again. When social and economic activities become stagnant, the impact on the real estate industry needs to be monitored, including rising concern about future employment and income environments.
Under these business circumstances, in the Real Estate Trading Business, its core segment, the Group worked to improve sales by continuing to implement measures initiated at the beginning of the fiscal year for improving investment yields by reviewing sales prices and improving occupancy rates, especially of properties held on a long-term basis, while strengthening the selling structure to expand property sales and replacing inventory. Through these activities, net sales for investment-type properties for the consolidated fiscal year under review recovered more than the same period of the previous year, but were insufficient to offset the decline in sales in the second quarter. As a result, net sales and profit fell below the previous year. Sales of residential-type properties remained steady after the lifting of the declaration of a state of emergency in May. Net sales and profit exceeded those of the previous year.
In the Leasing Business, purchases were tightened because sales of existing real estate for sale advanced and the COVID-19 impact was unclear. In addition, we worked to improve financial soundness by increasing cash on hand and raising the equity ratio, leading to a decrease in the balance of real estate for sale. As a result, revenue from real estate leasing fell short of that of the previous year.
In addition, we reversed some of the deferred tax assets in the third quarter of the fiscal year under review after we comprehensively took into account impacts of the COVID-19 pandemic on financial results and carefully considered the recoverability of deferred tax assets based on "Guidelines for Application of the Recoverability of Deferred Tax Assets." Consequently, we recorded income taxes - deferred of 535 million yen.
As a result, consolidated net sales decreased 12.1% year on year, to 34,858 million yen, consolidated operating income fell 21.9% year on year, to 2,465 million yen, consolidated ordinary income decreased 28.4% year on year, to 1,785 million yen, and consolidated profit attributable to owners of parent was down 64.5%, to 599 million yen in the fiscal year under review.
The following is an overview of the results by segment.
[Real Estate Trading Business]
In the Real Estate Trading Business, the number of units sold in investment-type properties came to 184 (down 68 units year on year)
and the average unit selling price was 140 million yen (up 14.5% year on year), registering net sales of 25,901 million yen (down 16.4% year on year). Meanwhile, the number of units sold in residential-type properties came to 148 (down 9 units year on year) and the average unit selling price was 39 million yen (up 16.5% year on year), registering net sales of 5,810 million yen (up 9.8% year on year).
As a result, net sales for the segment decreased 12.5% year on year, to 31,866 million yen, and segment profit (operating income for the segment) fell 14.7% year on year, to 2,812 million yen.
[Real Estate Leasing and Other Business]
In the Real Estate Leasing and Other Business, revenue from real estate leasing decreased 9.5% year on year, to 2,910 million yen. As a result, net sales for the segment decreased 8.6% year on year, to 2,992 million yen, and segment profit (operating income for the segment) fell 6.8% year on year, to 1,103 million yen.
Note: The "investment-type properties" are classified as real estate generating rental income, including rental condominiums and office blocks, which are used by buyers for the purpose of investment. The "residential-type properties" are classified as real estate used by buyers as their housing units, most of which are owned condominiums.
(2) Analysis of Financial Position
The financial position of the MUGEN ESTATE Group at the end of the consolidated fiscal year under review included assets of 62,487 million yen (down 8.8% from the end of the previous fiscal year), liabilities of 39,882 million yen (down 12.7% from the end of the previous fiscal year), and net assets of 22,605 million yen (down 1.0% from the end of the previous fiscal year).
Principal factors contributing to the decrease in assets included increases of 2,357 million yen in cash and deposits and 769 million yen in property, plant and equipment, more than offsetting a decrease of 8,379 million yen in real estate properties for sale.
The decrease in liabilities was attributable primarily to decreases of 5,438 million yen in long-term loans payable (including the current portion of long-term loans payable) and 211 million yen in bonds payable (including the current portion of bonds payable).
The decrease in net assets resulted in large part from a rise of 599 million yen in retained earnings due to the recording of profit attributable to owners of parent, partly offset by a decrease of 722 million yen in retained earnings attributable to dividends paid.
(3) Analysis of Cash Flows
Cash and cash equivalents ("cash") at the end of the consolidated fiscal year under review increased 2,380 million yen from the end of the previous consolidated fiscal year, to 14,649 million yen. The cash flow positions and contributing factors are as follows:
[Cash flows from operating activities]
Net cash provided in operating activities during the consolidated fiscal year under review totaled 10,981 million yen (net cash used in operating activities during the previous consolidated fiscal year was 3,276 million yen). This mainly reflects inflows in the form of a 8,524 million yen decrease in inventories, profit before income taxes of 1,808 million yen and depreciation of 890 million yen, which more than offset interest expenses of 662 million yen.
[Cash flows from investing activities]
Net cash used in investing activities during the consolidated fiscal year under review amounted to 1,944 million yen (net cash used in investing activities during the previous consolidated fiscal year was 872 million yen). This was primarily the result of proceeds of 1,976 million yen from the withdrawal of time deposits, offset by payments into deposits of 1,953 million yen and purchases of property, plant and equipment of 1,778 million yen.
[Cash flows from financing activities]
Net cash provided in financing activities during the consolidated fiscal year under review totaled 6,656 million yen (net cash provided in financing activities during the previous consolidated fiscal year was 712 million yen). This primarily reflects proceeds from long-term loans payable of 13,923 million yen and proceeds from the issuance of corporate bonds of 981 million yen, while the repayment of long-term loans payable was 19,361 million yen and the redemption of Bonds payable was 1,211 million yen.
(Reference) Cash flow indicators
FY2018 | FY2019 | FY2020 | |
Equity ratio (%) | 32.9 | 33.2 | 36.0 |
Market value equity ratio (%) | 19.1 | 28.2 | 18.4 |
Interest-bearing debt to cash flow ratio (years) | ― | 13.1 | 3.4 |
Interest coverage ratio (times) | ― | 5.2 | 16.6 |
Equity ratio: shareholders' equity / total assets
Market value equity ratio: market capitalization / total assets Interest-bearing debt to cash flow ratio: interest-bearing debts / cash flow Interest coverage ratio: cash flow / interest payment
Note 1: The market capitalization has been calculated by multiplying the closing stock price at the fiscal year-end by the number of shares outstanding at the fiscal year-end.
Note 2: The cash flow used for the calculation is cash flows from operating activities.
The interest-bearing debt to cash flow ratio and interest coverage ratio for FY2018 are omitted because the cash flows from operating activities in these years are negative.
(4) Outlook for FY2021 (January 1, 2021 to December 31, 2021)
We expect that a decline in corporate earnings and a deterioration in the income and employment environments due to the spread of the COVID-19 will affect consumption trends. However, we presume that social and economic activities will gradually normalize through the government's measures, the start of vaccination, and the continued easing of the financial environment.
In the real estate industry where the MUGEN ESTATE Group operates, we expect that domestic real estate investors will be more likely to strengthen wait-and-see attitudes due to uncertain future prospects from the spread of COVID-19. Any recovery in demand from overseas investors will also remain stagnant due to travel restrictions. Meanwhile, we estimate that the favorable used condominiums market we have been seeing since the second half of last year will remain strong and demand will continue to recover to a certain extent with respect to real estate trading trends.
Given this outlook, the Group reviewed its numerical targets for the fiscal year ending December 31, 2021, the final year of the medium-term management plan that was adopted in February 2019. As a result, net sales have been revised to 35,400 million yen, and ordinary income to 1,300 million yen. For details, refer to the "Notice Concerning Revision of the Medium-Term Management Plan" published today. We will continue to pursue our basic policies of "Make products that support the business base," "Build networks that support the revenue base," "Create human resources and systems that support the management base." In addition, we will make efforts to recover financial results by improving inventory turnover through a change in the sales system, gaining new revenue in the development business, and enhancing sites for real estate brokers.
In addition, we will pursue the diversification of revenue by increasing small-sized sales through the real estate specified joint enterprise business, obtaining diverse customer groups in the crowdfunding business, receiving orders for interior and exterior work for outside parties and increasing the number of rental condominium units. As for selling, general and administrative expenses for the fiscal year ending December 31, 2021, estimates of taxes and dues increased some 60% year on year because the tax on purchases related to the acquisition of rental residential buildings shall be outside the scope of the deduction for purchase due to partial revisions to the Consumption Tax Act applied on October 1, 2020 and onward.
Through the above measures, for the fiscal year ending December 31, 2021, we forecast consolidated net sales of 35,412 million yen (up 1.6% year on year), operating income of 1,916 million yen (down 22.3% year on year), ordinary income of 1,315 million yen (down 26.3% year on year), and profit attributable to owners of parent of 651 million yen (up 8.8% year on year).
The above forecasts regarding future performance are based on information available when this material was announced, and actual results may differ from the forecasts due to a variety of factors in the future.
(5) Basic Policy for Dividend Distribution and Dividends for FY2020 and FY2021
The Group considers the return to shareholders to be one of its most important management initiatives. Its basic policy is to continue to pay stable dividends, while simultaneously working to strengthen its financial conditions and enhance its internal reserves for the expansion of businesses on a long-term basis. With this in mind, it will determine the distribution of profit after comprehensively taking a range of factors into account, including the level of its business performance. It also seeks to achieve a standard dividend payout ratio of approximately 20% on a medium- to-long-term basis.
Regarding year-end dividends for the fiscal year ended December 31, 2020, we plan to pay 10 yen per share (ordinary dividend of 5 yen, commemorative dividend of 5 yen). Moreover, the payout ratio of year-end dividends for the fiscal year ending December 31, 2021 will exceed 20%, the medium- to long-term target level of the consolidated payout ratio. Nevertheless, a dividend of 10 yen per share and consolidated payout ratio of 36.8% are expected based on our basic policies of continuing enhancement of return and stable payment of dividends to shareholder.
2. Basic Perspective on Selection of Accounting Standards
The MUGEN ESTATE Group currently plans to prepare its consolidated financial statements based on the Japanese standards for the time being because it operates businesses in Tokyo Metropolitan Area, and because the percentage of foreign corporations and other non-Japanese shareholders is low.
The Group plans to discuss and examine the timing for introducing the International Financial Reporting Standards (IFRS), taking into account its business development going forward and factors such as domestic trends and international trends.
3. Consolidated Financial Statements | ||
(1) Consolidated Balance Sheets | ||
(Million yen) | ||
FY2019 | FY2020 | |
(As of December 31, 2019) | (As of December 31, 2020) | |
Assets | ||
Current assets | ||
Cash and deposits | 13,708 | 16,065 |
Accounts receivable - trade | 23 | 16 |
Real estate for sale | 49,887 | 41,337 |
Real estate for sale in process | 147 | 283 |
Other | 611 | 242 |
Allowance for doubtful accounts | (10) | (8) |
Total current assets | 64,367 | 57,937 |
Non-current assets | ||
Property, plant and equipment | ||
Buildings | 1,592 | 2,292 |
Accumulated depreciation | (394) | (397) |
Buildings, net | 1,197 | 1,895 |
Land | 1,790 | 1,908 |
Other | 180 | 114 |
Accumulated depreciation | (100) | (79) |
Other, net | 80 | 34 |
Total property, plant and equipment | 3,068 | 3838 |
Intangible assets | ||
Leasehold right | 55 | 55 |
Other | 28 | 27 |
Total intangible assets | 83 | 83 |
Investments and other assets | ||
Deferred tax assets | 777 | 241 |
Other | 167 | 342 |
Total investments and other assets | 944 | 583 |
Total non-current assets | 4,096 | 4,504 |
Deferred assets | ||
Bond issuance cost | 48 | 45 |
Total deferred assets | 48 | 45 |
Total assets | 68,512 | 62,487 |
(Million yen) | ||
FY2019 | FY2020 | |
(As of December 31, 2019) | (As of December 31, 2020) | |
Liabilities | ||
Current liabilities | ||
Accounts payable - trade | 467 | 216 |
Short-term borrowings | 2,236 | 2,050 |
Current portion of bonds payable | 1,154 | 860 |
Current portion of long-term borrowings | 6,950 | 6,192 |
Income taxes payable | 414 | 573 |
Provision for bonuses | 34 | 23 |
Construction warranty reserve | 41 | 42 |
Other | 887 | 1,178 |
Total current liabilities | 12,185 | 11,137 |
Non-current liabilities | ||
Bonds payable | 3,225 | 3,307 |
Long-term borrowings | 29,393 | 24,713 |
Retirement benefit liability | 89 | 101 |
Other | 777 | 622 |
Total non-current liabilities | 33,486 | 28,744 |
Total liabilities | 45,671 | 39,882 |
Net assets | ||
Shareholders' equity | ||
Share capital | 2,552 | 2,552 |
Capital surplus | 2,475 | 2,475 |
Retained earnings | 17,914 | 17,790 |
Treasury shares | (223) | (300) |
Total shareholders' equity | 22,718 | 22,518 |
Share acquisition rights | 122 | 86 |
Total net assets | 22,840 | 22,605 |
Total liabilities and net assets | 68,512 | 62,487 |
(2) Consolidated Statements of Income and Consolidated Statements of Comprehensive Income
Consolidated Statement of Income
(Million yen) | ||
FY2019 | FY2020 | |
(From January 1, 2019 | (From January 1, 2020 | |
to December 31, 2019) | to December 31, 2020) | |
Net sales | 39,677 | 34,858 |
Cost of sales | 33,202 | 28,994 |
Gross profit | 6,475 | 5,864 |
Selling, general and administrative expenses | 3,317 | 3,398 |
Operating profit | 3,157 | 2,465 |
Non-operating income | ||
Interest and dividend income | 1 | 1 |
Commission income | 17 | 18 |
Subsidies for employment adjustment | ʕ | 23 |
Penalty income | 27 | 17 |
Refund of real estate acquisition tax | 3 | 4 |
Other | 13 | 10 |
Total non-operating income | 64 | 76 |
Non-operating expenses | ||
Interest expenses | 635 | 669 |
Commission expenses | 61 | 46 |
Other | 31 | 41 |
Total non-operating expenses | 728 | 757 |
Ordinary profit | 2,493 | 1,785 |
Extraordinary income | ||
Gain on sales of non-current assets | 0 | 2 |
Gain on reversal of share acquisition rights | 6 | 38 |
Total extraordinary income | 6 | 40 |
Extraordinary losses | ||
Loss on sales of non-current assets | _ʕ | 3 |
Loss on retirement of non-current assets | ʕ | 14 |
Total extraordinary losses | ʕ | 17 |
Profit before income taxes | 2,500 | 1,808 |
Income taxes - current | 815 | 673 |
Income taxes - deferred | (4) | 535 |
Total income taxes | 811 | 1,209 |
Profit | 1,688 | 599 |
Profit attributable to owners of parent | 1,688 | 599 |
Consolidated Statements of Comprehensive IncomeFY2019 (From January 1, 2019 to December 31, 2019)
FY2020
(From January 1, 2020 to December 31, 2020)
Income before minority interests Comprehensive income Comprehensive income attributable to
1,688 599
1,688 599
Comprehensive income attributable to owners of parent
1,688 599
(3) Consolidated Statements of Changes in Net Assets
FY2019 (From January 1, 2019 to December 31, 2019)
(Million yen)
Shareholders' equity | Subscription rights to shares | Total net assets | |||||
Capital stock | Capital surplus | Retained earnings | Treasury shares | Total shareholders' equity | |||
Balance at the beginning of the fiscal year | 2,552 | 2,475 | 16,956 | (0) | 21,983 | 122 | 22,106 |
Changes of items during period | |||||||
Dividends of surplus | ሺ730) | ሺ730) | ሺ730) | ||||
Profit attributable to owners of parent | 1,688 | 1,688 | 1,688 | ||||
Purchase of treasury shares | ሺ223) | ሺ223) | ሺ223) | ||||
Net changes of items other than shareholders' equity | (0) | (0) | |||||
Total changes of items during period | ʕ | ʕ | 958 | ሺ223) | 734 | (0) | 734 |
Balance at the end of the fiscal year | 2,552 | 2,475 | 17,914 | ሺ223) | 22,718 | 122 | 22,840 |
FY2020 (From January 1, 2020 to December 31, 2020)
(Million yen)
Shareholders' equity | Subscription rights to shares | Total net assets | |||||
Capital stock | Capital surplus | Retained earnings | Treasury shares | Total shareholders' equity | |||
Balance at the beginning of the fiscal year | 2,552 | 2,475 | 17,914 | (223) | 22,718 | 122 | 22,840 |
Changes of items during period | |||||||
Dividends of surplus | ሺ722) | ሺ722) | ሺ722) | ||||
Profit attributable to owners of parent | 599 | 599 | 599 | ||||
Purchase of treasury shares | ሺ76) | ሺ76) | ሺ76) | ||||
Net changes of items other than shareholders' equity | (35) | (35) | |||||
Total changes of items during period | ʕ | ʕ | (123) | ሺ76) | (199) | (35) | (234) |
Balance at the end of the fiscal year | 2,552 | 2,475 | 17,790 | ሺ300) | 22,518 | 86 | 22,605 |
(4) Consolidated Statements of Cash Flows
FY2019 (From January 1, 2019 to December 31, 2019)FY2020 (From January 1, 2020 to December 31, 2020)Cash flows from operating activities
Profit before income taxes Depreciation
Increase (decrease) in allowance for doubtful accounts
Increase (decrease) in provision for bonuses Increase (decrease) in construction warranty reserve
Increase (decrease) in net defined benefit liability
Interest and dividend income Interest expenses
Share-based compensation expenses Refund of real estate acquisition tax Amortization of bond issuance costs Loss (gain) on sales of non-current assets Loss on retirement of non-current assets Gain on reversal of share acquisition rights Decrease (increase) in trade receivables Decrease (increase) in inventories Increase (decrease) in trade payables Increase (decrease) in accrued consumption taxes
Decrease (increase) in consumption taxes refund receivable
Increase (decrease) in lease and guarantee deposits received
Decrease (increase) in other current assets Increase (decrease) in other current liabilities Other, net
2,500 1,808
978 890
2 6
(12) (10)
(7) 1
0 12
(1) (1)
635 669
5 3
3 2
18 20
(0) 1
ʕ 14
(6) (38)
(1) 2
798 8,524
67 (250)
290 17
624 3
(97) (160)
(172) 349
(1) 274
18 18
Subtotal
Interest and dividend income received Interest expenses paid
Income taxes paid
5,642 1
12,159 1
(632) (662)
(1735) (516)
Net cash provided by (used in) operating activities
Cash flows from investing activities
3,276 10,981
Payments into time deposits
(1,966)
(1,953)
Proceeds from withdrawal of time deposits Purchase of property, plant and equipment Proceeds from sales of property, plant and equipment
1,892 (780)
1,976 (1,778)
0 9
Purchase of intangible assets Payments for investments in capital Payments of leasehold and guarantee deposits Proceeds from refund of leasehold and guarantee deposits
(9) (9)
(8) (14)
ʕ (204)
ʕ 29
Net cash provided by (used in) investing activities | (872) | (1,944) |
(Million yen)
FY2019 | FY2020 | |
(From January 1, 2019 | (From January 1, 2020 | |
to December 31, 2019) | to December 31, 2020) | |
Cash flows from financing activities | ||
Net increase (decrease) in short-term borrowings | (971) | (186) |
Proceeds from long-term borrowings | 21,330 | 13,923 |
Repayments of long-term borrowings | (20,590) | (19,361) |
Proceeds from issuance of bonds | 2,720 | 981 |
Redemption of bonds | (819) | (1,211) |
Purchase of treasury shares | (223) | (76) |
Repayments of lease obligations | (2) | (2) |
Cash dividends paid | (730) | (722) |
Net cash provided by (used in) financing activities | 712 | (6,656) |
Net increase (decrease) in cash and cash equivalents | 3,116 | 2,380 |
Cash and cash equivalents at beginning of period | 9,151 | 12,268 |
Cash and cash equivalents at end of period | 12,268 | 14,649 |
(Segment information)
[Segment information]
1. Summary of reportable segments
(1) Method for determining which segments to report
The reportable segments of the Group comprise those business units for which separate financial information is available, and which are subject to a regular review conducted by the Company's Board of Directors in order to determine the allocation of management resources and assess the business performance.
The principal business of the Group is real estate trading in which used condominium units and detached houses are purchased, refurbished, and sold. In addition, the Group operates a leasing business, in which it purchases and leases real estate for lease, leases condominiums and other buildings before selling, and provides lease management of condominiums, etc.
Therefore, the Group has decided that the "Real Estate Trading Business" and "Real Estate Leasing and Other Business" will be the segments it reports.
(2) Types of products and services in each reportable segment
The Real Estate Trading Business includes revenues from trading owned condominiums, investment-type properties (rental condominiums, and office blocks), and detached houses, related interior and exterior work, and sales brokerage.
The Real Estate Leasing and Other Business includes rent income from leasing condominiums, buildings, owned condominium units, etc., and fees for providing lease management service for rental condominiums and buildings.
2. Method for calculating net sales, profit or loss, assets, liabilities, and amounts of other items for each reportable segment
The accounting method for the reportable segments is generally the same as that provided in the "Key factors fundamental to the preparation of the consolidated financial statements."
Profit from the reportable segments is based on operating income. Inter-segment revenues and transfers are based on the prevailing market prices.
3. Information on net sales, profit or loss, assets, liabilities, and amounts of other items for each reportable segment
FY2019 (From January 1, 2019 to December 31, 2019)
(Million yen)
Reportable Segments | Adjustment (Note) | Total | |||
Real Estate Trading Business | Real Estate Leasing and Other Business | Sub-total | |||
Net sales Net sales to external customers Inter-segment sales or transfer | 36,401 41 | 3,275 ʕ | 39,677 41 | ʕ ሺ41) | 39,677 ʕ |
Total | 36,443 | 3,275 | 39,718 | ሺ41) | 39,677 |
Segment profit | 3,296 | 1,183 | 4,480 | ሺ1,322) | 3,157 |
Segment assets | 6,308 | 47,243 | 53,551 | 14,961 | 68,512 |
Other items Depreciation Increase in PPE and intangible non-current assets | 8 5 | 939 778 | 948 783 | 29 18 | 978 802 |
(Notes)
1. The adjustments include the following.
(1) The segment profit adjustment of (1,322) million yen consists of primarily company-wide expenses that are not allocated to the selling, general and administrative expenses of each reported segment.
(2) The segment asset adjustment of 14,961 million yen includes cash and cash deposits, deferred tax assets, assets related to the management division, and other items which are company-wide assets that are not allocated to each reported segment.
2. The segment profit has been adjusted to the operating income stated in the consolidated statements of income.
3. Because the rent income from the investment-type properties before the sale is included in the net sales in the Real Estate Leasing and Other Business, these properties are segment assets of the Real Estate Leasing and Other Business during the period of possession, and are transferred to the segment assets of the Real Estate Trading Business at the book value every time they are sold.
FY2020 (From January 1, 2020 to December 31, 2020)
(Million yen)
Reportable Segments | Adjustment (Note) | Total | |||
Real Estate Trading Business | Real Estate Leasing and Other Business | Sub-total | |||
Net sales Net sales to external customers Inter-segment sales or transfer | 31,866 26 | 2,992 26 | 34,858 53 | ʕ (53) | 34,858 ʕ |
Total | 31,892 | 3,019 | 34,912 | (53) | 34,858 |
Segment profit | 2,812 | 1,103 | 3,916 | (1,450) | 2,465 |
Segment assets | 4,810 | 40,804 | 45,615 | 16,871 | 62,487 |
Other items Depreciation Increase in PPE and intangible non-current assets | 9 5 | 849 1,659 | 858 1,664 | 31 163 | 890 1,828 |
(Notes)
1. The adjustments include the following.
(1) The segment profit adjustment of (1,450) million yen consists of primarily company-wide expenses that are not allocated to the selling, general and administrative expenses of each reported segment.
(2) The segment asset adjustment of 16,871 million yen includes cash and cash deposits, deferred tax assets, assets related to the management division, and other items which are company-wide assets that are not allocated to each reported segment.
2. The segment profit has been adjusted to the operating income stated in the consolidated statements of income.
3. Because the rent income from the investment-type properties before the sale is included in the net sales in the Real Estate Leasing and Other Business, these properties are segment assets of the Real Estate Leasing and Other Business during the period of possession, and are transferred to the segment assets of the Real Estate Trading Business at the book value every time they are sold.
(Per share information)
FY2019 (From January 1, 2019 to December 31, 2019) | FY2020 (From January 1, 2020 to December 31, 2020) | |
Net assets per share | 943.48 yen | 939.11 yen |
Net income per share | 69.38 yen | 24.98 yen |
Diluted net income per share | 69.10 yen | 24.86 yen |
The basis for the calculation of net income per share and diluted net income per share is as follows.
Item | FY2019 (From January 1, 2019 to December 31, 2019) | FY2020 (From January 1, 2020 to December 31, 2020) |
Net income per share | ||
Profit attributable to owners of parent (Million yen) | 1,688 | 599 |
Amount that does not belong to ordinary shareholders (Million yen) | ― | ― |
Profit attributable to owners of parent, available to common stock (Million yen) | 1,688 | 599 |
Average number of common stock outstanding for the period (shares) | 24,344,805 | 23,982,816 |
Diluted net income per share | ||
Adjustment for profit attributable to owners of parent (Million yen) | ― | ― |
Increase in the number of common stock (shares) | 96,046 | 115,978 |
(Subscription rights to shares(shares) ) | (96,046) | (115,978) |
Overview of dilutive shares not included in the calculation of diluted net income per share due to the absence of the dilution effect | ― | ― |
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Mugen Estate Co. Ltd. published this content on 01 March 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 01 March 2021 06:31:06 UTC.