Global One Real Estate Investment (8958) Q2 2024 earnings summary

Executive summary

• 41st-period DPU was ¥2,959, in line with forecast and down 2.6% from the prior period; internal reserves helped sustain distributions despite lower Otemachi ownership and sale gains.

• Six-month operating revenue was ¥7,161 million, operating profit ¥3,776 million, ordinary profit ¥3,361 million and net income ¥3,360 million; net income rose 0.2% year over year.

• Portfolio occupancy rose 0.6 percentage points QoQ to 97.2% at 31 March 2024.

Financial highlights

• Versus the prior six-month period, revenue declined 1.1% to ¥7,161 million, operating profit was flat at ¥3,776 million, and net income rose 0.2% to ¥3,360 million.

• NOI was ¥4,367 million, 1.3% above forecast; property-related profit and loss was ¥3,412 million, 1.8% above forecast.

• Net income per unit was ¥3,285, compared with ¥3,279 in the prior six-month period; total distributions were ¥3,026 million, or ¥2,959 per unit.

• Operating cash flow was ¥11,326 million, investing cash flow ¥424 million and financing cash flow negative ¥10,507 million; period-end cash was ¥10,769 million.

Outlook and guidance

• DPU is forecast at ¥2,400 for both the 42nd period ending September 2024 and the 43rd period ending March 2025; forecasts include Otemachi First Square sale gains of ¥363 million and ¥181 million, respectively.

• September 2024 forecast: revenue ¥6,481 million, operating profit ¥3,140 million, ordinary profit ¥2,709 million and net income ¥2,708 million.

• March 2025 forecast: revenue ¥6,161 million, operating profit ¥2,909 million, ordinary profit ¥2,455 million and net income ¥2,454 million.

• EPU excluding sale gains is projected to rise from ¥2,222 to ¥2,400 by the 44th period, supported by vacancy backfilling, rent increases and improved utility economics.