Investment securities valuation risk related to hotel occupancy rates and room rates at 新港ビル
First written in FY2025. 1 of 2 entries say "Materialised", first in FY2026. Latest entry: FY2026.
Fushiki Kairiku Unso moved to the "Worse" side of this theme in 2026, 2 years after the typical company in this theme (2024).
The whole theme swung hardest in 2023: 6 of 13 companies on the "Worse" side.
6 other companies' latest entry also says "Materialised".
- FY2026MaterialisedAnnual report
「During the current consolidated fiscal year, we recognized an impairment loss on the hotel fixed assets held by 新港ビル and determined that they needed to be written down to their recoverable amount. In applying the equity method, we reflected the impairment loss and reduced the goodwill equivalent, recognizing these amounts as an equity-method investment loss.」
For the hotel operated by 新港ビル, for which impairment had been deemed unnecessary in the previous year, the company recognized an impairment loss during the current year and recorded it as an equity-method investment loss. The key assumptions were the hotel occupancy rate and room rate, and the company also described the possibility of additional losses from the following year onward. - FY2025First statedAnnual report
「We have invested in 新港ビル株式会社, a hotel operator accounted for under the equity method. We recognize as goodwill the difference between the investment amount and 新港ビル株式会社’s net assets at the time of investment, and amortize the ¥68.594 million investment difference at acquisition, representing our share, on a straight-line basis over 20 years, with the amortization expense reflected in the consolidated financial statements. Although we determined that it was not necessary to recognize an impairment loss for the goodwill equivalent during the current consolidated fiscal year, if the key assumptions of the hotel occupancy rate and room rate change in the future and the investee’s profitability deteriorates, impairment accounting may be required. This could affect the amount of investment securities recognized in the consolidated financial statements for the next consolidated fiscal year and thereafter.」
Regarding the investment in a hotel operator accounted for under the equity method, the company has for the first time disclosed, as a separate material accounting estimate, the possibility that deterioration in profitability could lead to impairment of investment securities, using hotel occupancy rates and room rates as key assumptions. No impairment loss was recognized during the year.