Hoshino Resorts REIT (3287) investor relations material

Executive summary

• 26th-period revenue was ¥9,344 million and profit was ¥3,997 million; DPU reached ¥6,832, 5.1% above forecast.

• Stronger-than-forecast operations at real-time-linked properties, especially roadside hotels and the b hotels, and the AQUAIGNIS / Yunoyama Sosuikyo acquisition supported results.

• Pre-COVID distribution levels were achieved one period earlier than expected; the medium-term DPU ambition is ¥8,000.

Financial highlights

• Operating revenue rose 7.5% to ¥9,344 million; operating profit was ¥4,855 million, ordinary profit ¥3,998 million and profit ¥3,997 million.

• Revenue exceeded forecast by ¥181 million; operating expenses were ¥4,488 million, ¥3 million below forecast.

• Rental NOI was ¥7,852 million, ¥148 million above forecast; rental NOI yield was 6.7%, versus 6.6% forecast.

• DPU was ¥6,832 versus the ¥6,500 forecast, a ¥332 beat; increased operating revenue added ¥309 per unit to the forecast variance.

• Operating cash flow was ¥5,079 million, investing cash flow -¥8,250 million and financing cash flow ¥2,425 million; ending cash was ¥13,239 million.

Outlook and guidance

• Forecast DPU is ¥6,700 for the period ending October 2026 and ¥6,850 for the period ending April 2027, up ¥150, or 2.2%, sequentially.

• New master leases for three Comfort Hotels are expected to add ¥205 per unit in the 27th period and ¥130 in the 28th; normalized annual impact is estimated at ¥420 per unit.

• The ¥7,000 DPU target is delayed one year to the 31st period; the medium-term target is ¥8,000, supported by recovery efforts and growth initiatives.

• Guidance factors in expected rate increases and higher fixed-asset retirement, disposal and repair expenses.

• Forecasts assume partial reversal of the tax-purpose reserve; actual results and distributions may differ, and distributions are not guaranteed.