Establishment of a Real Estate Business and Effective Utilization of Assets Held

「At 株式会社エイチ・ツー・オー 商業開発, which operates Izumiya shopping centers, sells apparel and household-related goods, and manages tenants, revenue declined due to the downsizing of company-operated sales areas, but profit increased as the company actively utilized vacant tenant spaces, reconfigured company-operated sales areas and reduced costs through more efficient operations.」

「In light of the new medium-term management plan and to clarify the business purpose of the segment, the company changed the name of the reportable segment from 'Real Estate Business' to 'Commercial Facilities Business' beginning with the consolidated accounting period for the first quarter under review.」

「Real estate business　¥2,728 million　Izumiya store renovation work, 阪急商業開発 facility renovation work」

「Real estate business　¥2,016 million　Izumiya store renovations, 阪急商業開発 renovations」

「This was mainly due to a ¥13,392 million increase in property, plant and equipment from the rebuilding of Izumiya stores and expansion of 洛北阪急スクエア, and an ¥18,848 million increase in notes and accounts receivable due to seasonal factors and other items, partly offset by a ¥22,152 million decrease in cash and deposits from the acquisition of property, plant and equipment and repayment of interest-bearing debt.」

「This was mainly due to a ¥9,353 million increase in property, plant and equipment from the rebuilding of Izumiya stores and new openings by 阪急オアシス, and a ¥2,930 million increase in notes and accounts receivable due to front-loaded demand before the consumption tax increase, partly offset by a ¥20,938 million decrease in cash and deposits from the acquisition of property, plant and equipment and repayment of interest-bearing debt.」

「This was mainly due to a ¥20,149 million decrease in cash and deposits from payments of corporate taxes and the acquisition of property, plant and equipment, a ¥3,498 million increase in property, plant and equipment from capital investment including the rebuilding of Izumiya stores, and a ¥1,954 million increase in notes and accounts receivable due to seasonal factors and other items.」

「Property, plant and equipment increased by ¥13.9 billion, mainly due to a ¥32.0 billion increase from capital investment in projects including Phase I of the rebuilding of the Hanshin Main Store, expansion of Kanart Rakuhoku, and the rebuilding of Izumiya stores, partly offset by a ¥17.3 billion decrease from depreciation and amortization.」

「At イズミヤ株式会社, the company is advancing a store reorganization plan that includes rebuilding work for seismic resilience. In addition to 3 SM-format stores, including the Abiko store, where rebuilding was completed during the previous fiscal year, the Suminodo store in Osaka Prefecture opened in July as the first store converted from the GMS format to the SM format, followed by the Fushimi store in Kyoto Prefecture in December. Rebuilding work is currently under way at 2 GMS-format stores, with openings targeted during the next fiscal year.」

「At イズミヤ株式会社, the company is advancing a store reorganization plan that includes rebuilding work for seismic resilience. In addition to 3 SM-format stores, including the Abiko store, where rebuilding was completed during the previous fiscal year, the Suminodo store in Osaka Prefecture opened in July as the first store converted from the GMS format to the SM format. All of the stores have received strong support from local customers, and similar rebuilding work is under way at 3 GMS-format stores.」

「At イズミヤ株式会社, rebuilding work under the store reorganization plan is gathering pace, with work currently under way at 4 GMS-format stores. Three SM-format stores, including the Abiko store in Osaka Prefecture, where rebuilding was completed, are all performing steadily. In April, the Kishisato store in Osaka Prefecture opened as the first new store in approximately 2 years, and the store reorganization plan is progressing smoothly.」

「Rebuilding work is currently under way at 5 stores, including 株式会社カナート, and the stores are scheduled to open sequentially from the next fiscal year onward.」

「Rebuilding work is currently under way at 4 stores, comprising 2 GMS stores and 2 SM stores, and the store reorganization plan, including stores scheduled for work this fiscal year, is progressing smoothly.」

「To improve the earning power of its owned real estate, the company worked on formulating and implementing a reorganization plan covering seismic retrofits and renovations of Izumiya stores.」

「On 1 July 2016, the former イズミヤ株式会社 was reorganized, and 株式会社エイチ・ツー・オー アセットマネジメント, which manages and develops real estate, began operations to promote the effective use of the group's owned assets. During the period, the company worked on formulating a reorganization plan for the rebuilding and renovation of Izumiya stores.」

「On 1 July of this year, the former イズミヤ株式会社 was reorganized, and 株式会社エイチ・ツー・オー アセットマネジメント, which manages and develops real estate, began operations to promote the effective use of the group's owned assets. During the period, the company worked on formulating a reorganization plan for the rebuilding and renovation of Izumiya stores.」

「Under this reorganization, Ｈ２Ｏアセット will become a real estate company that uses the group's existing assets, including store land and buildings, from a group-wide perspective, while the new イズミヤ will operate the retail business. By clarifying the roles of each affiliated subsidiary, the group aims to improve operating efficiency and expand profit.」