Seibu Holdings Inc. (9024) Earnings Call Transcript & Summary

I will now explain using the material overview of financial results for the 3 months ended June 30, 2022. Please turn to Page 3. This is a summary of the first quarter results. In the first quarter, we achieved growth in both revenue and profit thanks to the recovery in demand due to factors such as the easing of restrictions on people's activities. We were able to turn profitable from the loss in the same period last year for operating profit as well as all the subsequent lines of profit. For your reference, please see the performance by segment as well as the reasons for the increase and decrease on Pages 5 and 6. We were able to outperform our forecast in terms of progress made towards the full year consolidated earnings. We have not changed our forecast for the year due to factors such as the uncertainty and demand trends for Q2 onwards. On Page 30, we show the recent trends in the railway business and our domestic hotel operations for your reference. Please turn to Page 9. On June 30, we signed the sale and purchase contract based on the basic agreement with GIC regarding some of the assets in the Hotel and Leisure segment. Details, including the scheduled date and price of disposal of the 31 properties, are as shown here. We are expecting to book a disposal gain in the current fiscal year ending March 2023 in relation to this transaction. The date of disposal as well as which properties are subject to the disposal are to be determined with the fulfillment of conditions outlined in the sale and purchase agreement, and we will promptly disclose if the need arises to revise our earnings forecast. Next, please see Page 10. At the upper left, we show how fixed expenses in Q1 was JPY 10.2 billion lower than in fiscal year 2019, and JPY 7.2 billion of the decline was in the Hotel and Leisure segment. As we show at the bottom of the page, today, we made the filing with the Kanto District Transport Bureau of the Ministry of Land, Infrastructure, Transport and Tourism regarding the pricing, maintenance and collection plan based on the railway station barrier-free pricing system. The details are disclosed on Seibu Railway's website. The collection period will be over the 8 years starting from March 2023, and the annual collection amount is expected to be JPY 4.9 billion. The proceeds will be used to develop barrier-free facilities, such as platform safety gates. Please turn to Page 14. As shown in bold font at around the middle of the page, we were recently mandated to newly operate The Prince Kitano New York as well as announcing the opening of Prince Smart Inn Osaka Yodoyabashi. This will mark the first time that the Seibu Group operates hotels in the cities of New York and Osaka, making it an important milestone for us. We will continue our initiatives towards expanding the business to 250 hotels. Thank you for your attention. [Statements in English on this transcript were spoken by an interpreter present on the live call.]