ＧＡ　ｔｅｃｈｎｏｌｏｇｉｅｓ（3491） – FY2022.10 1Q Financial Results presentation material

FY2022.10 1QF i n a n c i a l R e s u l t sNovember 1, 2021 – October 31, 2022株式会社 GAテクノロジーズM ar ch 17, 2022 ( Secu r it ies co d e: 3491)Our ambition■ Our ambition and purpose is to inspire and impress people with the power of technology and innovation. To achieve this goal, we must tackle the big unsolved issues.■ Based on our ambition, we will solve social problems through our business activities by bringing technology into the world of housing (real estate), which is the least developed of the three essential areas of life, apart from food and clothing.2RENOSY MarketplaceEnforcement of Real Estate Transaction Reform Bills■ A set of digital reform bills passed in May 2021 The reform bills regarding real estate transaction will come into force in May 2022.■ Major amendments include easing of regulations, such as contract procedures that previously had to be done either in person or by post.■ The real estate industry will likely take great strides in digitization moving away from in person, written transactions toward non-face-to-face, online procedures.May 2022Enforcement of Real Estate Transaction Reform BillsA paradigm shift in the real estate industry for the first time in 20 yearsLearn/searchCompare/considerApply/sign contractAfter signing contractPaper media, such as magazinesFace-to-face interviewDocumentsAnalog managementFirst digitization of real estate(Internet around 2000)Electronic media such as web and othersNon-face-to-face procedureOnline procedureDigital management*1) “Government plans to eliminate requirement of on-site pharmacists, tax documents and face-to-face procedures” in Nihon Keizai Shimbun dated October 9, 20203RENOSY MarketplaceThe Advent of Online Real Estate■ Since the launch of Windows 95 in 1995, the online world has exploded, and various industries have merged with the Internet.■ With the amendment in April 1998 to the brokerage agreement standards for trading securities, some transactions were liberalized, and the idea of online securities was conceived.■ Following this, online banking and online insurance was born, and with the enforcement of digital reform bills in May 2022, online real estate will have finally arrived.The coming together of finance and the Internet in JapanOnline securitiesOnline bankingOnline insuranceOnline real estateThe birth ofOnline Securities1998: Matsui Securities*1The birth ofOnline Banking 2000: Japan Net Bank (now PayPay Bank)*2The birth ofOnline Insurance2008: Lifenet Insurance Company*42008: AXA Direct Life Insurance*3199820002008202120222021: Digital reform bills enacted, including amendments to the Real Estate Brokerage ActMay 2022: Digitization of various contracts, including real estate sales contracts and explanations of important mattersThe Arrival of Online Real EstateNotes:1. See Matsui Securities website (www.matsui.co.jp/first/merit/history/)2. See Japan Net Bank website (www.japannetbank.co.jp/company/15th/)3. See Lifenet Insurance Company website (www.lifenet-seimei.co.jp/profile/history/)4. See AXA Direct Life Insurance website (www.axa-direct.co.jp/company/official_info/pr/2019/190125.html)4RENOSY MarketplaceReal Estate Business Goes Online■ We have been promoting DX for buyers to improve operational efficiency.■ Similarly, by promoting DX for sellers, we can achieve even greater operational efficiency and improve productivity.■ GA technologies is going to be the pioneer in the industry to push the DX for both real estate buyers and seller. Our Initiative in Leading the Move Online for Real Estate BusinessBringing both buyers and sellers onlineLearn / SearchCompare / ConsiderApply / Sign contractInvest / ManageLearning contentSet meeting datesOnlinemeetingOnlineapplicationOnlinecontractManage property / assetAll OnlineLearnResearchConsult / ConsiderSign contractAttract customersAI-based assessmentsSet meeting datesOnlinemeetingSimulationsOnlinecontractAll Online5BuyersSellersRENOSY MarketplaceMoving Real Estate Online■Only 1% of property transactions are conducted online currently.■ Other industries have a relatively high online penetration compared to real estate, and market leaders are highly regarded.■ Further online promotion is needed to increase RENOSY marketplace’s share to become the market leader.Becoming a Market Leader in Online Real EstateIndustryRetailTransportReal EstateOnlinepenetration14 %4 %1 %note1note1note2Market leaderNote 2: Calculated sales via online transactions based on the ratio of online transactions in the RENOSY marketplace for the fiscal year ending October 2021, and converted by dividing by the SAM of existing condominiums of 50㎡ or more in the Tokyo metropolitan area (6.9 trillion).6GA Technologies Group – Business OverviewArea of BusinessBusiness SummaryMain Products and ServicesOnline TransactionsRENOSY MarketplaceSubscriptionsProviding a complete package to find sellers and buyers, matching them together to make actual transactions happen by using the media of RENOSY. A wide-ranging product line-up covering brokerage of luxury condominiums for rent and demand for private use, as well as all investment properties including small, new build and pre-owned condominiums, and overseas real estate.Property management for owners of real estate, offering multiple plans with a fixed-price subscription for services that protect asset value.Third party servicesMaking RENOSY media available to third-party businesses, providing them with use of the media and introducing customers.SaaSITANDIMarketplaceProviding a system to real estate companies (mainly rental housing management companies and real estate agencies) to improve work efficiency through monthly and pay-as-you-go fees.Building a platform that connects people with living, to be offered free of charge as an exclusive real estate website for B2B, and as a rental/house-hunting website for B2C with a revenue model based on commissions for each contract.New Business/OtherRENOSY Marketplace-related BusinessDeveloping new business related to RENOSY marketplace. Operating a mortgage application platform and one of the largest Japanese real estate platforms in Greater China.Note 1) Data for third party service is counted towards the new business7Direction of Profit and Growth Investment for FY2022Sharp Focus and Selection of Investments while Expanding Growth PathReturn to Profit from Last Year’s LowLast YearThis YearBusiness・Cultivated numerous growth seeds, including new businessCost・Increased personnel costs owing to aggressive investments・Office expansion with more employeesRevenue・Commissions declined due to higher procurement costs as a result of higher procurement prices.・Focus on 2 businesses of RENOSY Marketplace and ITANDI・New business also focused on RENOSY Marketplace-related business・Increased personnel costs only for growth businesses・Achieve annual rent reduction of approx. ¥100m by reviewing office layouts, etc.・Implement ways to improve commission through seller DX, etc.・Build strong barriers to entry by expanding market shareRecruitment and Organization・Active recruitment (investment) in all divisions, including new business・Sharp focus and selection for recruitment and staffing・Restructure, making personnel changes to strengthen businessesM&A・Aggressive M&A to accelerate market share expansion・Prioritize creating synergies with 7 existing M&A companies over new M&A8Summary of Q1 FY2022GA Technologies Group – Consolidated・Both sales and profits were in line with initial guidance. Consolidated operating income was minus 600 million yen, but this was due to weak sales progress caused by the seasonality of each fiscal year, and was within the expected range. No change in operating income generation for the full year.・Continued aggressive growth investment to maximize future profits through market share expansion. However, we invested with discipline, concentrating resources on RENOSY Marketplace and ITANDI.・Focused on purchasing managers’ index (PMI) for M&A. Aiming to maximize synergies with existing M&A partner companies rather than actively seeking any new M&A.RENOSY MarketplaceITANDINew Business/OtherOnline Transactions・Enhanced technology has increased RENOSY awareness, and improved user experience has increased the number of transactions for buyers and sellers.・Expected to acquire new and existing customers to reach about 260,000 members in total with acquired inquires of more than 5,000.Subscriptions・With the increase in number of online transactions, the number of properties on subscription has risen to 10,000 with assets increasing to 250 billion yen.Third Party Services*・Starting with the appointment reservation service for our clients as well as continue to push up the precision of our matching system with different strategies.SaaS・With revisions to the Real Estate Brokerage Act soon to come into force, the number of newly acquired digital applications and contracts has increased.・Many SMBs in particular have come aboard thanks to an increase in the number of sales staff dedicated to SaaS for realtors.Marketplace・ITANDI BB’s page views exceeded 4 million / month, and as a site with real-time information, it has gained a lot of recognition from real estate companies, leading to further growth.Note 1) Data for third party service is counted towards the new businessRENOSY Marketplace-related Business・Shenjumiaosuan has shifted strategies to increase site value rather than revenue due to the impact of the pandemic. Aims to expand the number of properties listed on the site.9Full-Year Performance Highlights (Consolidated)■ Consolidated performanceRENOSY Marketplace has driven growth for the Group with revenue and gross profit increasing steadily. Despite consolidated operating profit of minus 600 million yen, the deficit shrank YoY. Our second largest business ITANDI, also saw increased net sales and gross profit, growing to 14% of group gross profit.■RENOSY MarketplaceSignificant increases with net sales up 68% YoY and gross profit up 51% YoY. Continued investment to improve commissions and increase market share. Aiming for high growth while balancing scale expansion with profits.■ITANDIThe SaaS business led growth with revenue up 70% YoY and gross profit up 80% YoY. Sector profit was positive at 58 million yen against the backdrop of strong net sales and gross profit growth.■ New business, etc.In terms of new business, businesses with high profitability were selected, leveraging the foundation and strengths of RENOSY Marketplace. As a result, gross profit margin exceeded 40% but sector profit was negative owing to the impact of the pandemic on Shenjumiaosuan.RevenueGross ProfitOperating Profit17,339Million yen68+YoY%2,461Million yen56+YoY%699Million yen（last season 1Q△722million yen）RENOSY MarketplaceITANDINew Businesses HQ expensesConsolidated adjustmentConsolidated totalRevenue16,797(YoY＋68％)417(YoY＋70％)133(YoY＋104％)Gross profit2,063(YoY＋51％)347(YoY＋80％)54(YoY＋154％)△817,339△42,461Gross margin ratioSector profit12.29%83.29% 40.58%-14.19%133(YoY＋96％)58（last season 1Q△0million yen）△54（last season 1Q△56million yen）△703 △103 △669Note 1) Our reporting segment is single segment of “RENOSY business” before FY2021.10 but given that the “RENOSY business” is scheduled to be divided into two segments — “RENOSY Marketplace” and “ITANDI” from FY2022.10, the amounts in accordance with the relevant segment are retrospectively calculated and stated.10—Full-Year Performance Trends■ Revenue were 16% of the initial plan, and gross profit was 19% of the initial plan. Q1 progress rates tend to be low due to seasonality.JGAAP(Reference)IFRSJGAAP (Reference)IFRSRevenue*1,216%Earnings forecast110,00085,388 63,070 Gross Profit*1,219%Earnings forecast13,20011,447 9,861 39,286 20,126 9,557 5,373 17,339 1,753 874 2,461 FY2016.10 FY2017.10 FY2018.10 FY2019.10 FY2020.10 FY2021.10 FY2022.10FY2016.10 FY2017.10 FY2018.10 FY2019.10 FY2020.10 FY2021.10 FY2022.10(Million yen)(Million yen)6,850 3,522 * 1. Produced in consolidated financial statement since FY 2019.10 *2. Forecast disclosed in our FY2021.10 Q4 financial statement11Full-Year Performance Trends■ EBITDA and operating profit were slow in Q1, proportional to weak net sales.■ Although progress is slow compared to initial projections, guidance is unchanged and as planned for full-year profit targets.JGAAP(Reference)IFRSJGAAP(Reference)IFRSEBITDA*1,2,310%Earnings forecast4,0002,8611,6581,466Operating Profit*2,31,8881,193729381△ 63678356417(Million yen)△ 75Earnings forecast57△ 39 △ 669(Million yen)FY2016.10 FY2017.10 FY2018.10 FY2019.10 FY2020.10 FY2021.10 FY2022.10FY2016.10 FY2017.10 FY2018.10 FY2019.10 FY2020.10 FY2021.10*1. EBITDA representing ability to create cash flow (Operating Profit + depreciation costs *2. Produced in consolidated financial statement since FY 2019.10 *3. Forecast disclosed in our Q3 financial statement (released Sep 14, 2021)12FY2022.10 1QQuarterly Trends(IFRS)■ Both revenue and gross profit remained strong at the level above YoY 50%.■ The reason why the EBITDA growth rate is larger than operating profit is due to amortization incurred on items such as lease agreements and master leases recorded as right-of-use assets under the IFRS standards.■ Operating profit deficit narrows.FY202 1.10 1Q FY202 2.10 1QFY202 1.10 1Q FY202 2.10 1QG r o s s p r o f i tYoY 56%2,4611,579O p e r a t i o n p r o f i t△722 △669FY2021.10 1Q FY2022.10 1QR e v e n u eYoY 68%17,33910,329E B I T D AYoY862%41743FY202 1.10 1Q FY202 2.10 1QNote 1) EBITDA refers to the productivity of cash flow (sales revenue ＋amortizations) note 2)The data is made based on financial documents released after FY2019.10(7th season)13Q1 FY2022Quarterly Trends (Reference)■ Revenue were strong for both RENOSY Marketplace and ITANDI.■ ITANDI’s share of gross profit gradually increased to 14%. Gross profit margin is high at 80% with profit contribution expected to increase in the future.R e v e n u eG r o s s p r o f i tNote 1)JGAAP(reference)JGAAP (reference)IFRSnote1)IFRS30,380 24,800 23,279 18,125 17,339 3,679 3,431 3,370 2,595 2,461 2,486 2,254 2,166 1,700 1,632 1,688 1,802 15,205 14,742 13,407 12,082 9,411 9,127 9,842 7,339 6,839 5,126 4,505 3,654 2,998 2,397 2,337 1,824 1,350 1,195 907 762 656 445 450 504 352 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q（million yen）FY2017.10FY2018.10FY2019.10FY2020.10FY2021.10FY2022.10FY2017.10FY2018.10FY2019.10FY2020.10FY2021.10 FY2022.10（million yen）Note 1) The data is made based on financial documents released after FY2019.10(7th season)14Q1 FY2022Quarterly Trends (Reference)■ EIBITDA and operating profit progressed as planned.E B I T D ANote1,2)O p e r a t i o n p r o f i tNote 2)JGAAP (reference)IFRSJGAAP (reference)IFRS1,4921,0938577125336614171,204739742471260245△46△644△3831321156514714314667362238291 200122273255126625913913413010711878△30011（million yen）1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q１QFY2017.10FY2018.10FY2019.10FY2020.10FY2021.10FY2022.10FY2017.10FY2018.10FY2019.10FY2020.10FY2021.10FY2022.10△ 669（million yen）*1. EBITDA representing ability to create cash flow (Operating Profit + depreciation costs *2. Produced in consolidated financial statement since FY 2019.10 *3. Forecast disclosed in our Q3 financial statement (released Sep 14, 2021)15FY2022.10 1QSG&A Trend■Advertising costs increase due to active investment to expand market share.■ Added right of use depreciation as per IFRS standards (the depreciation of right of use assets such as offices, company housing, and office machines).■ With a selected and focused personnel strategy, investment in growth businesses has been strengthened thanks to personnel transfers, etc., resulting in less new hires and consequently a slight decrease in personnel expenses.S G & A T r e n dJGAAP (reference)note1)IFRS2,627 2,447 2,227 491165 523147 200 116 96 2,015 1,994 429441130 158 3,433 2,978 635217233146176728461181213149146557455166 193 124 134 443 103 OthersRental pl ace andcom mon areaexpensesDepreciati onTaxesAdv ertisingRecrui tment394 383 626154 52 275 78 68 245 107 220 113 877 911 1,004 759 672 ルベラ軸1,735 46096 1,514 1,444 1,427 4213601,272 42842 34159 247 197 90 71 247 212 70 356 437 507 438 550 360 3,100Others67416419288730365001401907838368911 TaxesAd vertisin gRecrui tment1,205 1,232 Personnel1,212 Personnel2,272Amortisation ofrights-of-use assetsAm ortiz ationDepreciation1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4QFY2019.10FY2020.10FY2021.101 Q1 QFY2021.10FY2022.10Note 1）Based on financial documents released after FY2019.10（7th season）16FY2022.10 1Q Growth Investment■ Figures compiled are based on IFRS standards from Q1, but there will be no impact on past figures due to the change in accounting standards.■ Disciplined investment in new businesses in areas where growth is expected, businesses that are judged not to provide a suitable ROI will be promptly withdrawn.G r o w t h i n v e s t m e n tnote1)YoY16%JGAAP IFRS419420115 133 144 35235565 81 29747 475448484165 177 ■ Investment phase business■ Development costs254 241 267 251 260 268 265 21715 25025 23026 26437 172 193 173 195 217 17013 133 23 1Q28 2Q32 3Q30 4Q32 1Q32 2Q32 3Q32 4Q35 1Q36 2Q43 3Q42 4QFY2019.10868FY2020.101,270FY2021.101,764■ R&D42 1QFY2022.10* Breakdown of growth investment (including capitalization): R&D = Personnel costs for AI-related departments; Development costs = Personnel costs for development-related departments;Investment phase = Personnel costs for Shenjumiaosuan, living advisors, ITANDI (OHEYAGO, ITANDIBB, and incidental services business), and RENOSY X17FY2022.10 1QEmployees Trend■ Adopted to referral recruitment system in order to save cost and to recruit talented personnel. ■ A slight decrease in number of employees owing to personnel strategy of selection and concentration. Reinforcement through transfers and other measures is being implemented in growing businesses, while minimizing new hires.N o . o f e m p l o y e e snote1,2,3)YoY26%743 73872659%business666571 577521495398344 339 34727621015914191 109 11681581Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1QFY2017.10FY201810FY2019.10FY2020.10FY2021.10FY2022.10Note1）Board members, contracted workers, internships, part time workers are excluded (by Oct. 31,2021)Note2）Based on financial documents after FY2019.10（season 7） Note 3) The numbers are being rounded up so it may not add up to 100%24%engineers17%corporatenote3）（people）18RENOSY MarketplaceRENOSY MarketplaceHighlights■ Gross Merchandise Value (GMV) expanded steadily to 20.2 billion, up about 40% YoY.■ A significant increase with over 900 contracts concluded, up about 70% YoY.■The number of RENOSY members has grown to approximately 260,000, and we aim to improve LTV through cross-selling by expanding the product lineupNote 1）GMV20.2billion YenYoY about +40%No. of contractsNo. of membersNote 2）Note 3）924 dealsYoY about +70%about260k ppl.YoY about +35%Note 1）Note 2）Note 3）Total annual volume of transactions for iBuyer, Living and PartnersTotal number of annual contracts for iBuyer, Living, and PartnersRefers to the total number of registered members20RENOSY MarketplaceFY2022.10 1QQuarterly trends(IFRS)■ RENOSY Marketplace saw strong supply and demand thanks to more RENOSY members and direct procurement through seller DX, leading to year-on-year growth for net sales and gross profit.■ Sector profit increased significantly, up 96% YoY.R e v e n u eG r o s s p r o f i tD i v i s i o n p r o f i tYoY68%YoY51%YoY 96%16,7972,06310,0201,36713367FY2021.10 1Q FY2022.10 1QFY2021.10 1Q FY2022.10 1QFY2021.1Q FY2022.1Q（million yen）21RENOSY MarketplaceFY2022.10 1QQuarterly trends(IFRS)■ Revenue, gross profit, and sector profit favorable against backdrop of strong supply and demand.R e v e n u eG r o s s p r o f i tD i v i s i o n p r o f i tJGAAP (reference)IFRSJGAAP (reference)IFRSJGAAP (reference)IFRS29,76122,89224,4333,2133,2893,13117,64816,7972,3112,0962,0962,3232,0631,5881,5091,5291,2441,59014,89614,44113,1519,56311,7739,1998,8387,1691Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q（million yen）FY2019.10FY2020.10FY2021.10FY2022.10FY2019.10FY2020.10FY2021.10FY2022.10FY2019.10FY2020.10FY2021.10FY2022.101,8281,7091,2981,0138054988936336761,19963223713322RENOSY Marketplace RENOSY Member Stock Trends■ The stock of members has grown along with RENOSY’s recognition. YoY growth was 35% and members increased by 17,000 QoQ.No. of stocked membersnote1)YoY 35%88,567 166,449 87,205 151,110 85,087 134,109 82,513 121,911 80,062 108,737 Sites merge98,058 86,594 76,653 68,451 59,323 53,091 2,377 4,417 7,540 10,806 14,901 19,881 24,868 31,849 37,091 42,564 （people）1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1QFY2017.10FY201810FY2019.10FY2020.10FY2021.10FY2022.10Note 1)The number refers to the total number of users registered as the official RENOSY member23RENOSY Marketplace (Subscriptions)KPI Trends■ Cumulative subscriptions grew 48% year-on-year pushing stock to nearly 10,000.■ The number of owners also grew by 51% year-on-year, with strong growth totalingapproximately 5,500 owners.No. of subscriptions注1)N o . o f o w n e r sYoYYoY48%YoY51%10,1859,3668,4767,5616,8976,0245,5305,504 5,1914,561 4,148 3,643 3,404 4,5834,3623,9273,3082,8632,4222,881 2,495 2,142 1,924 1,611 1,384 1,189 1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q（cases）（people）FY2019.10FY2020.10FY2021.10FY2022.10FY2019.10FY2020.10FY2021.10FY2022.10note1) The number was collected based on the number of deals made before FY2020.10 1Q and changed the standard for collection to number of listings managed after that.24ITANDIITANDIHighlights■ ARR growth rate accelerated to 61.4% YoY.■ With deregulation of electronic contracts on the horizon, we have gained about a 70% share of the (pre-contract stage) online tenant application market.■ Revenues from stock gained with high gross profit margin from SaaS development.■ SaaS churn rates remain low and future earnings are expected to be stable.YoY ARR GrowthRate*161.4%SaaS Gross ProfitMargin*383.3%Online Tenant Application Share*269.4%Churn Rate*40.44%Notes:1.Annual Recurring Revenue is calculated based on the MRR of each quarterly month (by the end of each month) times 12. MRR which includes monthly usage fee, pay-as-you-go fee, profit from additional businesses. It is calculated based on the ARR comparison between the numbers from Jan., 2021 and Jan.,2022 of ITANDI BB+. 2. It is an in-house estimations based on research data from TPC Market Research as of March 20213. It is the figure of ITANDI BB+ as of 1Q 2022 (Nov., 2021-Jan.,2022)4. It is the average monthly churn rate of ITANDI BB+ for the past one year starting from Jan., 202226ITANDIFY2022.10 1Q Performance trends (IFRS)■ SaaS business performed well with net sales up 70% YoY.■ A high growth rate for gross profit, up 80% YoY.■ Sector profit made it into the black at 58 million yen. High growth rate achieved while maintaining profitability through cost-effective investments.G r o s s p r o f i tO p e r a t i o n p r o f i tR e v e n u eYoY70%YoY80%41724534719258FY2021.10 1Q FY2022.10 1QFY2021.10 1Q FY2022.10 1QFY2021.10 1Q FY2022.10 1Q（million yen）（million yen）△0（million yen）27ITANDIFY2022.10 1Q Performance trends(Reference)■ SaaS business performed well, expanding net sales, gross profit, and sector profit.R e v e n u eG r o s s p r o f i tD i v i s i o n p r o f i tJGAAP (reference)IFRSJGAAP (reference)IFRSJGAAP (reference)IFRS4173313102822452361961981803476826624922612412410410892 8292901921771521421383338332421221Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q（million yen）（million yen）-1-20（million yen）FY2019.10FY2020.10FY2021.10FY2022.10FY2019.10FY2020.10FY2021.10FY2022.10FY2019.10FY2020.10FY2021.10FY2022.10588828ITANDISaaS for Management CompaniesKPI Trends■ KPI has been changed from number of subscribing companies to number of companies using SaaS. The churn rate is also calculated based on the number of companies using SaaS.■ MRR growth rate accelerated, up 69% YoY. Pay-as-you-go and incidental services business revenues increased during the busy moving season from January to March.■ The churn rate has been on a downward trend, declining to 0.41% on average for the last 12 months.■ The number of companies using SaaS exceeded 1,000, growing significantly, up 79% YoY.■ Gross profit also remained strong, up 88% YoY surpassing MRR growth.M R RNote 1)YoY69%Churn rateNote 2)Avg.last12 mths0.41%26.5270.26.8249.278.25.826.6270.380.338.307.31.029.647.645.5442.39.239.8414.37.6496.47.245.257.3.103.092.103 084..084.0850.71.074 055.0.47.0510.470.430.360.34.0410.450.460.360.38.039.039.039 0.41（%）23456789 10 11 12 123456789 10 11 12 12 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1FY2020.10FY2021.10FY2022.10FY2020.10FY2021.10FY2022.10（million yen）Subscribing CompaniesNote 3)YoY79%1,091 952 839 726 608 469 368 265 G r o s s p r o f i tYoY88%IFRS15381物確 電話⾃動 応答24時間内⾒ 予約電⼦⼊居申込電⼦契約 更 新退 去Web管 理デ ータ 連 携⾃ 動化FY2020.10FY2021.10FY2022.10*1. Monthly SaaS user fees, incidental services business, product pay-as-you-go fees *2. management companies with system subscriptions note 3)Management companies those started with the service292Q3Q4Q1Q2Q3Q4Q1QFY2021.10 1QFY2022.10 1Q（companies）（million yen）ITANDISaaS for Real Estate AgenciesKPI Trends■ The definition was changed from number of subscribing companies to number of companies using SaaS. As a result, the churn rate is now calculated based on the number of real estate agencies using SaaS.■ MRR remained strong, up 55% YoY. It dipped in September and October 2021 when some large companies ended their subscriptions but picked again in Q1.■ The churn rate has been on a downward trend, declining to 0.60% on average for the last 12 months.■ Over 400 real estate agencies are now using SaaS, up 118% and more than doubling thanks to boosting sales personnel, etc.■ Gross profit remained strong, up 63% YoY.111125153MRR*1YoY55%65.1609.508.531.511.48.5556.452.45.9479.32.932.432.432.533.4342.342.37.9371.375.399.4241.4425.Churn RateAvg.last12 mths0.60%.1331.25.13 12.1.17.121.132.132.1231.260.930.91.0910.830.75.0790.830.74.077.068.069.0560.7 0.6（%）23456789 10 11 12 123456789 10 11 12 12 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1FY2020.10FY2021.10FY2022.10FY2020.10FY2021.10FY2022.10(Million yen)Subscribing Companies*2YoY118%406チャーンレート：0.45 %310256186213Gross ProfitYoY63%IFRS1821112Q3Q4Q1Q2Q3Q4Q1QFY2021.10 1QFY2022.10 1Q(Contracts)FY2020.10FY2021.10FY2022.10*1. Monthly SaaS user fees, product pay-as-you-go fees *2. Real Estate Agencies with system subscriptionsNote 3)Real estate agencies those started with service(Million yen)30ITANDI’sKey Metrics■ Key earnings metrics of ITANDI.YoY■ Significant YoY growth in all metrics thanks to aggressive investments.■ ITANDI BB has been steadily increasing number of page views since its launch in June 2020, increasing 4.4 times YoY.■ Online tenant applications have increased after acquiring new online tenant application customers.■ The number of properties listed on OHEYAGO, a key metric for attracting customers, has grown significantly YoY. The number of tenant applicants resulting from searches has also increased thanks to more properties listed.ITANDI BB monthly page viewsOnline tenantapplicationsOHEYAGOlisted properties337%4,008,000 YoY80%177,8372,934,0002,370,0001,962,000143,594 128,467 118,187 98,725 69,085 61,587 70,365 50,279 916,000594,000446,000YoY100%67,543 62,99956,77844,48333,84619,8836,2213,8422,1373 Q4 Q1 Q2 Q3 Q4 Q1 Q1Q2Q3Q4Q1Q2Q3Q4Q1Q1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4 Q 1 QFY2020.10FY2021.10FY2022. 10FY2020.10FY2021.10FY2022. 10FY2020.10FY2021.10FY2022. 10Approximately 280,000 according to data released before today, however the correct number is about 350,000.31Our growth strategyRENOSY Marketplace RENOSY MarketplaceService Overview■ Based on the concept of “Finding a home and managing assets is easy with RENOSY”, the RENOSY marketplace consists of three services.Finding a home and managing assets is easy with RENOSYOnline TransactionSubscriptionThird Party ServicesAll real estate transactions on the RENOSY marketplaceProviding unique, fixed-pricemanagement plans for property ownersProviding other servicesto RENOSY members34SellersIndividualsRENOSY MarketplaceBusiness Summary■ RENOSY MarketplaceAttract customers interested in investing, selling, leasing, and renting real estate.■ Online TransactionNot only matching supply and demand in terms of investments, sales, leases, and rentals on the RENOSY marketplace, but also conducting all real estate transactions with in-house sales.■ SubscriptionProviding a number of flat-fee services as a management business to protect the value of real estate assets for the owners.■ Third Party ServicesProviding other related services by forging better digital contact with customers for RENOSY members.RENOSYMarketplaceOnline TransactionAll real estate transactionson the RENOSY marketplaceSubscriptionProviding unique, fixed-pricemanagement plans for real estate ownersThird Party ServicesProviding other servicesto RENOSY membersBuyersIndividuals35CompaniesCompaniesRENOSY MarketplaceFeatures■ RENOSY has been chosen by customers as a result of pursuing customer satisfaction by incorporating technology into real estate since it was first founded.RENOSY Features(Why customers are choosing RENOSY)※1BrandInnovation ProductUsabilityOne-stopProviding peace of mind, security, and transparency to be the No. 1 for brand appeal in real estate investment.By packaging previously non-transparent and complicated real estate transactions, anyone can easily buy and sell.Offering a comprehensive service with all products from media and business talks, to contracts and management after real estate purchase.All transactions completed online, making RENOSY not only convenient and easy to use, but also delivering high levels of customer satisfaction.Providing a wide range of small-lot (STO / NFT) products including new build and pre-owned condominiums, buildings, new build and pre-owned apartments, and overseas real estate.Notes:1. Source: Japan’s real estate investment market (housing), NLI Research Institute Real Estate Investment Report (March 12, 2021)36RENOSY MarketplaceStrengths■ RENOSY Marketplace has six major strengths.RENOSY Marketplace StrengthsMembers（stocked)Note 1)Brand AwarenessNote 2)InquiriesContractsNote 3)Note 4)Direct procurementNote 5)Market shareNote 6)Approx. 260,00065％Approx. 5,300average/monthApprox.370average/monthApprox.80average/monthPre-owned apartment market in Tokyo5.3%Note 1)This refers to the accum ulated num ber of registered m em bers Note 2)The result was researched using net research service “Fastask”Note 3)The num ber refers to the avg. num ber of inquiries we received regarding investm ent and own used properties Note 4) The num ber refers to the avg. num ber of deals m ade by RENOSY m arketplace in a m onth (except for PARTNERS) Note 5) The num ber refers to the num ber of deals m ade directly by the salespeople in PARTNERSNote 6) The num ber was calculated based on the press release released by TOKYO KANTEI Co.,Ltd. titled “The M arket of newly-built and pre-owned apartm ents” on Janurary 202137RENOSY MarketplaceGrowth Feasibility■ In order to quickly expand RENOSY Marketplace’s market share, we will continue to develop our business aggressively by aiming for a high growth rate without ever slowing down.FY2019.10 1QFY2022.10 1QFutureRENOSY stockedMembersNote 1)Approx.40,000Brand AwarenessNote 2)Approx. 27%Approx.260,000(X6.5)Approx. 65%(X2.4)InquiriesNote 3)Approx.2,100 Approx.5,300 (X2.5)ContractsNote 4)Approx.200Approx.370(X1.6)Direct procurement(deals made)Note 5)Approx.1Approx.80 (X80)Market shareNote 6)(pre-owned apartments in Tokyo)2.6％5.3％ (X2)Aiming for high growth speed in the futureNote 1)This refers to the accum ulated num ber of registered m em bers Note 2)The result was researched using net research service “Fastask”Note 3)The num ber refers to the avg. num ber of inquiries we received regarding investm ent and own used properties Note 4) The num ber refers to the avg. num ber of deals m ade by RENOSY m arketplace in a m onth (except for PARTNERS) Note 5) The num ber refers to the num ber of deals m ade directly by the salespeople in PARTNERSNote 6) The num ber was calculated based on the press release released by TOKYO KANTEI Co.,Ltd. titled “The M arket of newly-built and pre-owned apartm ents” on Janurary 202138RENOSY MarketplaceStrengthening Profitability■ There has been an increase in RENOSY members due to more brand awareness, leading to more inquiries.■ By introducing customers to third party services and cross-selling with first parties with an expanded product line-up, we will eliminate any missed opportunities in the process of acquiring customers from inquiries to contracts, leading to greater revenues.Maximizing revenues by eliminating missed opportunities for both first and third partiesCross-sellingContractsApprox. 370IntroducecustomersOnlinetransaction(first party)Business talksApprox. 1,300Third partyservicesTargetsApprox. 2,700InquiriesApprox. 5,300*Monthly average over the past yearWe have acquired high-value customers and data rich inquiries through strategic marketing methods39RENOSY MarketplaceOnline TransactionsImportant KPI■ Providing additional services to RENOSY members.■ In the future, measures to acquire new and repeat customers will improve CPA making it possible to attract customers with low unit prices. By doing so, aim to optimize the CPO.■ LTV is improved through measures to acquire sellers and expanded product lineup.■ Optimize CPO, improve LTV, and maximize unit economics through better up-selling and cross-selling, pursuing customer benefits, and increasing satisfaction.Optimize CPOImprove LTVMeasures to acquire new andrepeated customersMeasures to acquire sellers and expanded product lineupMaximize unit economics*CPA＝Cost Per Acquisition, CPO=Cost Per Order, LTV=Lifetime Value40RENOSY Marketplace Online TransactionsStrategy to Improve Commission■ Expand product line up■ Until now, the focus has been on expanding market share of small, pre-owned condominiums in existing business.■ Moving forward, aim to expand product lineup by first acquiring a company that specializes in small, new build condominiums.■ In the future, strengthen the marketplace business by handling new and pre-owned apartments, buildings, and overseas real estate.■These network effects will create a virtuous cycle revenue modelImprove user experienceOnline transactionsExpand product lineupNew condominiumsNew /pre-ownedapartmentsOverseas real estateSmall lots (STO/NFT)Increaseamount incirculationGrowth・Network effects・Virtuous cycleIncreasetransactionvolumeIncrease sellersOnline transactionExpand product lineupNew condominiumsNew /pre-ownedapartmentsOverseas real estate41RENOSY MarketplaceAccelerating Growth with M&A■ Aggressive M&A to accelerate growth of RENOSY marketplace.■ M&A has been focused within the territory of RENOSY Marketplace, and no deal has been done outside of it.■Improve LTV centered around expanded customer base (= expand product line-up) and strengthen media (= improve ability to attract customers) to improve CPO■ Through M&A, overseas expansion also creates a stepping stone toward greater TAM.RENOSY MarketplaceAccelerating Growth with M&AExpand Customer Base(Expand product line-up)Media Enhancement( Customer attraction)Overseas ExpansionImproved LTVGreater TAMOptimized CPO42RENOSY Marketplace: The Road to Increase Market ShareGA technologies share of pre-owned condominiums under the size of 50m2 and under in the Tokyo metropolitan areaFY2021.10Increased market share through sales of 80 billion yen5.3%FY2022.10 (forecast)Through sales of 100 billion yen6.6%FutureAim to expand market share as soon as possible, including third-party services20%Market profit of the industryTAM (approx.)65 trillion yen*1,3Condominiums over the size of 50m2 in the TokyoSAM 6.9 trillion yen*2,4Condominiums under the size of 50m2 in the TokyoSAM1.5 trillion yenAim to expand share to 20%*2,4Grow to share of 6.6%GA technologies share 5.3%Notes:1. Source: Japanʼs real estate investment market size of profitable real estate by use, NLI Research Institute Real Estate Investment Report (March 12, 2021)2. Estimated with reference to results released by Tokyo Kantei Co.,Ltd.: Press release Newly built / existing apartments market size of Tokyo metropolitan area (Jan. 2021), Tokyo Kantei Co.,Ltd.: Press release Newly built / existing apartment logistics change of Tokyo metropolitan area (May 2021), Data of registered properties released by Real Estate Information Network for East Japan, Data from top 10 companies in the property investment industry3. TAM: Total Addressable Market (The maximum potential market size that the RENOSY marketplace business can take over)4. SAM: Serviceable Available Market (The market share size that the RENOSY marketplace business is targeting)43RENOSY marketplaceGrowth Strategy■ In the mid to long term, we will expand our market share based on online transactions and grow each sector including overseas businessExpand use of services to other businesses by leveraging customer base of RENOSY, No.1 real estate investment company in terms of sales in JapanOverseasExpansionNew businessThird-partyserviceSubscriptionOnline transactionBusiness serviceNow※1) Sales results of used condominium investment by Tokyo Shoko Research (surveyed in February 2021)Lifetime44ITANDIProvide a platform that connects and flourish the lives of people with livingITANDI’s Vision■ In the short term, aim for smooth real estate transactions through SaaS and marketplace.■ In the long term, aim for a platform that modernizes overall “living” after occupancy including real estate.Looking for aroomRealtorViewSearchApplyEnd UserContractEnd tenancyRenewMove inResideManagementcompanyResiding46ITANDIIssues in the Rental Housing Industry and ITANDI’s Value Promise■ Information asymmetryProblems with bait and switch properties where inaccurate information*1 is advertised to consumers.■ Low productivity due to analog working stylePhone and fax are still being used. Compared to other industries, the adoption of IT has lagged behind, leaving many monotonous and geriatric tasks such as data entry from paper to systems.■ Worker shortages due to falling laboring populationWith about 50%*2 of real estate workers over the age of 60, and a turnover rate of 8.1%*2, the future labor shortage is even more serious than in other industries.Notes:1. Taken from Real Estate Industry Vision 2030, Ministry of Land, Infrastructure, Transport and Tourism2. Taken from 2020 H2 Employment Trends Survey, Ministry of Health, Labour and WelfareIssues in the Rental Housing IndustryInformation asymmetryLow productivity due to analog work styleWorker shortages due to falling laboring populationITANDI’s Value PromiseProvide accurate information in real timeMarketplaceStreamline operations to promote DXSaaS tailored to the rental housing industry47ITANDI’sService Overview■ Rollout services in both SaaS and marketplace to achieve Vision.■ Each service shares real-time property data and has established its own position.To provide a platform that connects people with livingSaaSMarketplaceFor management companiesFor real estate agenciesReal estate industry professionals’ websiteHouse-hunting website(self-view)48ITANDISustainable Growthin the SaaS Business■ ARR was up 61% year-on-year due to growth in the main services of SaaS for management companies and SaaS for real estate agencies.ARR Growth売上高推移+61%*1,2YoY1,4691,1141,0801,125910800710720656446463422525509290306248１Q２Q３Q４Q１Q２Q３Q４Q１Q２Q３Q４Q１Q２Q３Q４Q１QFY2018FY2019FY2020FY2021FY2022Notes:1. Annual Recurring Revenue. Calculated by multiplying the end of quarter MRR by 12.2. Comparison of ITANDI BB+ ARR as of January 2021 and January 2022.(Million yen)49ITANDIThree Growth Driving Factors■ Growing market needs■ ITANDI BB network effects■ Expansion of service lineup0102Growing market needs03ITANDI BBnetwork effectsExpanded service line-up50ITANDIGrowing Market Needs■ There is high demand among both prospective tenants and real estate businesses to move to digital contracts. Revisions to the Real Estate Brokerage Act, which will come into force May 2022, are expected to further elevate demand.High Expectations for Digital Contracts before EnforcementProspective tenantsReal estate businessesWant digital contracts*173%Want to move to digital contracts*283%Notes:1. Source: Survey on the intention to use digital contracts in rental agreements, ITANDI, Inc. (2021)The percentage of respondents who answered they “Want to use digital contracts” in answer to the question, “After revisions to the law come into effect, you will also have the choice of using digital contracts for signing rental agreements. In which case, what form of contract do you want to use?”. 2. Source: Survey on DX Promotion in the Real Estate Industry, Joint project between 7 real estate tech companies and 1 organization (2021).The percentage of respondents who answered “Making preparations to move” (30%), “Will move after assessing the situation” (33%), “Want to move but unsure about operations” (10%), or “Want to move but unsure about what system to use” (10%) in answer to the question, “Digital reform bills have been passed at the plenary session of the House of Representatives with revisions coming into effect for the real estate industry regarding the digitization of documents (Articles 34, 35, and 37). Are you making preparations for a move to digital contracts?”51ITANDIWhat is ITANDI BB?■ A marketplace that makes transactions more efficient by matching management companies that list vacant properties with real estate agencies that want to introduce properties to consumers.■ Increases market share by differentiating with features not available on other real estate websites, such as real-time property information confirmation, viewing reservations, digital applications and digital contracts.Management Companies1,100companiesMarketplaceITANDI BBConfirm propertiesAble to check real-time property dataBook viewingsEasily book viewings on the calendarDigital applicationsSmooth process with No.1 share in the digital applications marketDigital contractsFully digital contract process with system linked to digital applicationsRealtors43,000offices52ITANDI BB grows as a marketplace while drawing the ideal J-curve4 million PV/month100,000 viewings booked/month80,000 digital applications/monthITANDIITANDI BBNetwork Effects■ Number of real estate agencies browsing (PV), viewing reservation, and digital tenant applications grew exponentially as number of properties listed on ITANDI BB increased.■ With the growth of ITANDI BB comes increased sales and streamlining for management companies using SaaS, driving further increase in the number of companies wanting to use SaaS.■ The number of digital contracts will also become a metric after the enforcement of Digital Reform Bills.11 12 1 2 3 4 5 6 7 8 9 1011 12 1 2 3 4 5 6 7 8 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1FY2019FY2020FY2021FY202253Providing services in a complete packageITANDIExpanded Service Line-up■ Expanded service line-up for real estate companies in the rental housing market.A complete package to help digitize real estate related work.VisitofficeCheckpropertiesBookviewingsonlineOnlinetenantapplicationsDigitalcontractsOnlinerenewals/check out54ITANDIGrowth Strategy■ ITANDI BB improves convenience for real estate companies that use the book viewings and digital application features, as well as the property search function which makes use of the real-time nature of properties available, to create a competitive advantage as an inter-agency website.■ ITANDI BB+ (SaaS) aims to improve ARPU by promoting the use of new products for existing customers while accelerating the acquisition of new customers through the network effect of the marketplace ITANDI BB.■ OHEYAGO continuously increases the number of listed properties while taking advantage of its high level of customer satisfaction to strengthen its ability to attract customers.Aiming for growth by honing our strengths in every area in light of future digital expansion in the real estate marketEnhancing competitive advantage with improved convenience and real-time strengthsLeveraging ITANDI BB’s network to acquire new customers and improve ARPU for existing customersAiming to improve ability to attract customers by running promotions that leverage high levels of customer experience55ITANDIITANDI BBGrowth Strategy■ Enhance competitive advantage by supporting the business of real estate agencies to differentiate from other companies’ public and private real estate websites through further improvements to ITANDI BB’s real-time capabilities and convenience.■ Meet the needs of SMBs (and enterprises which have been the main target to date) improved vacancy rates to increase the number of listings by utilizing website networks.Enhancing competitive advantage with improved convenience and real-time strengthsList propertiesCheck availability, conduct viewingsApplication and contract supportRealtorMarketpropertyList propertyCheckvacancyBookviewingDigitalapplicationDigitalcontractPublic real estate websitesPrivate real estate websitesReal-timeproperty dataUseLinkStreamlineSaaS56Improving ARPU by expanding multiple services utilizing ITANDI BB’s networkKey services this yearITANDIITANDI BB+ (SaaS)Growth Strategy■ Roll out SaaS paid services by utilizing the network effect of ITANDI BB’s 43,000 offices and 4 million PV.■ Improve ARPU while continuing to acquire new customers.■ Following on from Moshikomiuketsuke-kun and Nomad Cloud, focus on expanding sales in 2022 for Koshintaikyo-kunand Denshikeiyaku-kun.43,000officesStart to charge free users on the marketplace57ITANDIOHEYAGOGrowth Strategy*1■ Obtained NPS*1 of 39.4 (the average for other companies’ real estate websites is -36.7*2) with a smart property search experience using technology. 15.4 pointincrease from previous quarter survey.■ As well as an increase in the number of properties, the number of unique users (UU) to the site has greatly improved with the start of the moving season.■ Aiming for viral effect through enhanced SEO owning to increasing number of properties and marketing measures that enjoy high customer satisfaction levels.Notes:1. Net Promoter Score, a metric used to measure customer loyalty.2. Taken from the NPS® Benchmark Survey 2019, Real Estate Information Websites, NTTCom Online Marketing Solutions Corporation.Greater ability to attract customers with high levels of customer satisfactionNPSCustomer satisfaction39.4Attracting customersOrganic UUYoY+388%188,758Unique users67,543Properties33,846Organic UU38,692No. of listed properties11121234567891011121234567891011121FY2020FY2021FY202258ITANDIFuture Expansion■ Expand market share based on SaaS for management companies and SaaS for real estate agencies, aiming to grow as a platform essential for the real estate industry that “connects people with their lives” in the medium to long term.Expand use of services in other businesses byleveraging customer base of Moshikomiuketsuke-kun, which has the largest number of usersNowNowNew BusinessSaaS for management companiesSaaS forreal estate agencies59A p p e n d i xSummary of Income Statement (Consolidated) （IFRS）■ EBITDAThe reason why the EBITDA growth rate is larger than operating profit is due to amortization incurred on items such as lease agreements and master leases at head office, etc. recorded as right-of-use assets (real estates included) under the IFRS standards.■ Financial costsInterest expenses of 78 million yen on interest-bearing debt and 32 million yen in commissions related to loans and commitment lines totaled 111 million yen.Gross profitOperating profitRevenueattributable to owners of parentYoY comparisonsFY2022.101Q ①FY2021.101Q ②Amount of change（③=①-②）Percentage of change（①/ ②）Progress on forecast(million yen) FY2022.10Accumulative amount ③FY2022.10Result forecast ④Achievement rate（③/ ④）Revenue17,33910,3297,009+68%17,339110,00016%2,4611,579881+56%2,46113,20019%EBITDA41743373+862%4174,00010%△669△722△561△5875226——△66957△561△700——61Summary of Balance Sheet（Consolidated）（IFRS）■ Current assetsIncreasing inventory heading into Q2, recording a quarterly net loss, and payment of corporation taxes, etc., have resulted in a decrease in cash and deposits.■ Fixed assetsRight-of-use assets have increased due to the extension of rental lease agreement. ■ LiabilitiesIncreased lease liabilities (interest-bearing liabilities) related to extension of head office lease agreement.FY2022.10 1Q ①FY2021.10 4Q ②Amount of change（③=①-②）Percentage of change（①/②）Total Assets48,594△301Current assets(Cash and cash equivalents)(Real estate for sale)Fixed assets(Investment property)(Goodwill)(Intangible assets)(Right-to-use assets)Liabilities(interest-bearing debt)Net assetsTotal liabilities and net assets48,29218,478(13,024)(3,864)29,814(14,748)(5,082)(3,485)(2,644)31,138(26,603)17,15419,453(15,275)(2,836)29,140(15,222)(5,082)(3,451)(1,773)30,921(26,100)△975(△2,250)(1,027)673(△473)(0)(34)(870)216(502)17,672△51848,29248,594△301(million yen) △1%△5%(△15%)(+36%)2%(△3%)(+0%)(+1%)(+49%)1%(+2%)△3%△1%62Voluntary adoption of International Financial Reporting Standards (IFRS)Objectives of voluntary adoption of IFRS■ Facilitation of fund procurementFacilitate explanations of financial statements to overseas investors and expand fund-raising options■ Peers comparisonCompliance with international accounting standards facilitates comparisons with global peers.■ Improved efficiency of business managementBy applying IFRS to all companies in the group, including overseas subsidiaries, indicators between companies will be unified, making business management more efficient.JGAAPIFRSAllowance for leave with payAllowance for leave with payNo special treatmentProvide for reserves based on the number of days of leave granted and the rate of use.Evaluation method for unlisted stocks, etc.Evaluation method for unlisted, etc. stocksAccounting for goodwillAccounting for goodwillUnlisted stocks, etc., for which it is difficult to determine the market value are left unchanged at acquisition cost (not marked to market), except in cases where they are impaired.Amortization of goodwill arising as a result of M&A is not subject to amortizationRegularly amortized each fiscal year over a certain amortization periodAccounting for operating leasesBSPLNo special treatmentRents related to office and other lease contracts are recorded as expenses in the month they are incurred.All financial instruments, including unlisted stocks, etc., shall be valued at fair value by reasonably calculating their fair value.Regular amortization is not implemented. However, a more rigorous evaluation (impairment test) of the value of goodwill generated as a result of M&A is conducted every fiscal year, taking into account the business conditions of the target business, future market environment, and other factors.Accounting for operating leasesBSPLPresent value of total rent is recorded in the balance sheet (assets and liabilities)・Assets are amortized every fiscal year using the straight-line method.・Interest expense from liabilities is recognized each period.63FY2022.10 Assumptions for the full-year consolidated earnings forecastFY2022.10 Budget Assumptions (Top Line)FY2022.10 Budget Assumptions (Costs)OverallIncrease sales and market share in all businessesOverallRENOSYMarketplaceOnline transactionsRENOSYMarketplace SubscriptionsITANDISaaS for real estate agenciesITANDI SaaS for management companiesNew BusinessIncrease market share through aggressive marketing activities, continuing to expand sales. Secure business profits despite a certain amount of leeway for lower commission with priority given to expanding market share.Increase sales in proportion to the number of online transactions. Promote DX and improve profitability as a standalone business.Revenue pillar of the ITANDI. Further accelerate the pace of sales expansion by strengthening sales and other stuff/ other activities, while securing profits to fund investment.Continue to prioritize expanding market share rather than short-term profits as still in investment phase. Likely to see profits in 2-3 years.Establish business model by expanding and developing sales channels as still in business start-up phase.RENOSYMarketplaceOnline transactionsRENOSYMarketplace SubscriptionsITANDISaaS for real estate agenciesITANDI SaaS for management companiesNew BusinessIncrease personnel for sales expansion, investment in business, and M&A strategy. Maximize the effective use of management resources and avoid incurring excess costs.Plan to increase number of employees by about 90 (up approx. 20%), mainly for sales. Costs required to expand market share, such as advertising costs, will increase.Although sales will increase, number of employees will increase slightly, and cost increases will be limited. Likely to see profits from the current fiscal year.In order to expand sales, increase number of employees by about 15 (up approx. 35%) mainly in sales and customer service, making upfront investment to accelerate sales.Increase number of employees by about 50 (up approx. +55%) mainly in sales and customer service, continuing to make upfront investment to expand market share.After setting certain rules, determine increase/decrease in personnel and investment amount according to business progress.64FY2022.10 Full-Year Consolidated Results and Earnings Forecast by SegmentConsolidateRevenueGross profitEBITDAOperating profitProfit attributable to owners of parentOld Standards (JGAAP)FY2021.10New Standards (IFRS)FY2022.10(forecast)（million Yen）110,00013,2004,00057▲70085,38811,4471,466▲39▲1,26965FY2022.10 Full-Year Consolidated Results and Earnings Forecast by SegmentBy SectorRENOSY Marketplace ITANDIRevenueGross profitSector profitRevenueGross profitSector profitFY2022.10(forecast) FY2021.10Year-on-Year107,26111,8373,1091,6911,340▲15283,61610,3343,7781,17093414（million）+28%+15%▲18%+45%+43%−66Digital Reform BillsGovernment Trends in Bringing Real Estate Transactions Online日本基準IFRSApplicationContract■ What are the Digital Reform Bills?The digital reform bills refer not just about one specific law but to several different laws. The Bill on Development of Related Laws to Form a Digital Society relaxes rules and regulations to facilitate future use of digital means.■ The real estate industry needs to pay attention to the review of procedures for issuing documents and affixing sealsA total of 48 laws will be amended through this review.It is hoped that digitization in the real estate industry will accelerate with the easing of regulations, such as contract procedures that previously had to be done either in person or by post.usylPrevoiStandard issuing of contract documents must be on papertmenrceenfoAfter All onlineApplication processExplanation of important mattersArt. 35 documentsRental/Sales agreementArt. 37 documents☑☑Now☑☑× ☑ ×☑☑☑After Enforcement of Digital Reform Bills(Revisions scheduled for May 2022)Issuing documents on important mattersThe real estate broker must have a real estate transaction specialist issue documents to parties involved to explain important matters related to the real estate transaction up until the contract is concluded. If certain conditions are met, explanations can be given by means other than face-to-face, such as by video conferencing, but important matters must be provided on paper. Furthermore, the signature and seal of the real estate transaction specialist is required for the documentation explaining important matters.Issuing contract documentsWhen a contract is concluded, the real estate broker must issue a contract that describes the contents of the real estate transaction to each party. Furthermore, the signature and seal of the real estate transaction specialist is required for the contract.With consent from other parties involved in the transaction, documentation on important matters can be provided in digital form instead of on paper. Furthermore, the signature and seal of the real estate transaction specialist is not required.With consent from parties concerned in the transaction, the real estate contract can be provided in digital form instead of on paper. Furthermore, the signature and seal of the real estate transaction specialist is not required for the contract.Rental and purchase contracts can be completed digitally by digitizingdocuments and making contracts non face-to-face by putting them online.67GA technologies Group Unique Positioning1950 onwards2000 onwards2015 onwardsPeriodRealOnlineOnline & RealSales and development, distribution, property management, lettings, investments and asset managementMedia operationsMedia operations×Sales and development, distribution, property management, lettings, investments and asset managementBusinessmodelServicesMajor comprehensive developerMajor portal websiteInvestments and asset managementProperty managementRent & lease×××68Market Scale of Prop TechMarketcapitalization893.9Billion YenRightmove (UK)Operates a real estate portal: \47.2BNet sales : \35.0BOperating profitMarket capit