Japan Prime Realty Investment (8955) Q2 2024 earnings summary

Executive summary

• Adjusted EPU was ¥7,551, up ¥174 period on period and ¥51 above forecast; June DPU was ¥7,600.

• The portfolio comprised 68 properties with ¥525.8bn in acquisition value; period-end occupancy was 97.1%.

• DPU guidance rises to ¥7,700 for December 2024 and ¥7,800 for June 2025, including planned reserve reversals.

Financial highlights

• H1 FY2024 revenue was ¥17,644m, up 1.3%; operating income was ¥8,354m, ordinary income ¥7,531m and net income ¥7,530m, each up 2.4% versus the prior fiscal period.

• Adjusted EPU, excluding asset-sale gains or losses, was ¥7,551; December 2024 and June 2025 forecasts are ¥7,520.

• Rental business profit increased to ¥9,344m from ¥9,096m; NOI rose to ¥11,493m from ¥11,153m.

• DPU was ¥7,600, with ¥7,578m distributed; payout ratio was 100.6%, including a ¥47m reserve reversal.

Outlook and guidance

• December 2024 forecast: revenue ¥18,207m, operating income ¥8,427m, net income ¥7,499m and DPU ¥7,700, including a ¥178m reserve reversal.

• June 2025 forecast: revenue ¥17,847m, operating income ¥8,444m, net income ¥7,499m and DPU ¥7,800, including a ¥278m reserve reversal.

• Management targets adjusted EPU of ¥7,600 by June 2025, mainly through external growth; rental revenue recovery depends on leasing progress, particularly at MS Shibaura.

• Revised distribution strategy targets ~2% annual DPU growth from ¥7,600, driven by rent increases, acquisitions and asset-sale gains.

• Forecast assumptions include no acquisitions, disposals or new unit issuance, refinancing of maturing debt, and LTV of 42.9% at both period ends.